Falling prices and rising operating costs are squeezing mining companies’ profits
The sharp rise in energy and freight costs, linked to the conflict in the Middle East, has made around 10% of global seaborne iron ore shipments unprofitable. This was stated by the chief executive of mining company Vale, Gustavo Pimenta, in an interview with Bloomberg TV.
This state of affairs increases the likelihood of prices recovering as production volumes are cut by companies with high production costs.
According to Vale’s estimates, approximately 160 million tonnes of annual ore shipments are generating losses, whilst production capacity of around 15 million tonnes has already been taken out of operation due to rising costs.
Iron ore futures in Singapore fell below $90/t last week for the first time in two years. Prices are under pressure from falling demand from China and high global supply.
Falling prices and rising operating costs are squeezing the profits of mining companies, particularly among smaller producers. Pimenta expects that a reduction in production will help restore market balance and support the recovery, although the timeframe remains uncertain.
The director also expressed confidence in Chinese demand and Brazil’s regulatory policy on mineral extraction ahead of the second round of the country’s presidential election on 25 October. In particular, he noted that demand in China remains stable, whilst there has also been significant growth in other steel-producing countries, such as India and Vietnam.
It should be recalled that in September 2026, Vale confirmed the conclusion of an agreement to acquire a 30% minority stake in the iron ore company Ligga S.A. through an investment of approximately $190 million. A key condition of the agreement is a long-term contract under which the mining giant will receive the exclusive right to purchase 100% of the sinter feed produced by Ligga. The contract is currently awaiting standard corporate and regulatory approval.
Thanks to this move, Vale will secure long-term access to additional volumes of high-quality iron ore and enhance the flexibility of its Northern mining system.
https://gmk.center/en/news/rising-costs-are-making-10-of-global-iron-ore-supplies-unprofitable-vale/
On October 9, 2026, President Donald Trump announced an agreement with Russian President Vladimir Putin to permit Russian diesel imports into the United States by temporarily lifting federal restrictions. Under the agreement, Russia is to supply more than 300,000 tonnes of diesel immediately, an additional 500,000 tonnes in November, and 1,000,000 tonnes after that. The administration had not said which legal mechanism it would use to reconcile the deal with existing restrictions, and on October 10 Representative Brian Fitzpatrick of Pennsylvania began pursuing a discharge petition to force a House vote on legislation that would block it.
The United States restricted Russian energy imports after Russia’s full-scale invasion of Ukraine in 2022. Executive Order 14066 prohibits imports of Russian crude oil, petroleum fuels, liquefied natural gas and coal, and the Ending Importation of Russian Oil Act separately prohibits imports of Russian energy products, though it lets the president end that prohibition after making specified certifications to Congress. On September 18, 2026, Trump signed the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026, which authorizes tariffs of up to 500% on Russian-origin energy goods.
We wondered what Americans think of the deal. So we asked 1,071 registered voters (MoE of 3.0%) from October 12 to October 18, 2026 about it:
Which of the following statements best reflects your opinion on the October 2026 Russian diesel import deal?
What voters said
Most Americans disapprove of the deal. 63% disapprove, and 52% disapprove strongly, which makes strong disapproval the largest single answer by a wide margin. Only 25% approve: 13% strongly approve and 12% approve. Another 11% are neutral, and 2% chose none of the above.
https://www.activote.net/analysis/63-of-americans-disapprove-of-the-russian-diesel-import-deal/
Oil prices surged in early trading Tuesday, as energy markets adjusted to a new normal in the Middle East. The increase in crude prices threatened to drive up the cost of gas in the United States just two weeks before the midterm elections.
U.S. crude prices jumped as much as 5% to about $109 a barrel, the highest price since April, while the price of international Brent crude climbed 1.5% to more than $111, its highest price since May. Prices pulled back later in the morning, after weaker-than-expected U.S. housing starts raised the prospect of a broader slowdown and lower demand.
Prices for advanced oil contracts dated for next year also hit record highs, “implying an extended period of high oil prices deep into 2027,” Deutsche Bank analysts said in a note Tuesday.
“The 2027 contracts are moving higher as well as the possible reality of higher for longer oil prices sink in,” Peter Boockvar, author of the Boock Report and chief investment officer of OnePoint BFG Wealth Partners, said in a note Tuesday.
High gas prices have become a major issue for voters in the midterms, where Republicans face dwindling odds of maintaining their control of Congress.
A recent NBC News poll found that 67% of U.S. adults believe gas prices are a “very serious” or “somewhat serious” problem. A majority also said that current economic conditions have caused them to change their spending habits.
U.S. gasoline prices had started off the week lower. At $4.28 a gallon, the national average price of unleaded was on pace to reach its lowest level in a month.
But that trend is likely to be upended as higher crude prices filter through to the pump.
Several factors were contributing to Tuesday’s oil price hikes.
The cost of chartering a large tanker vessel to transport oil through the Strait of Hormuz has quadrupled since September, data shows.
Much of that increase is a risk premium, both for sailors and insurance. During the past two weeks, at least 18 vessels have been attacked in the strait, the ship-tracking group Kpler said in a note Monday.
The higher cost of transport has begun to offset the recent bump in supply from a growing number of ships moving through the strait.
The Iranian attacks on ships have also prompted investor speculation that the Trump administration will be more likely to escalate against Iran after the midterms, the Deutsche Bank analysts said.
Iran-aligned Houthi rebels also claimed Monday that they had hit airport, energy and military targets in Saudi Arabia, as well as a training camp in Yemen for that government’s security forces.
The U.K. will begin deploying fighter jets over Saudi Arabia to help protect against further Houthi attacks, the Defense Ministry said Tuesday.
The entry of another country’s military into the regional hostilities was taken as a further sign of escalating tensions.
https://www.nbcnews.com/business/energy/oil-prices-new-normal-gas-midterms-rcna604542
The UK government has initiated a review of the ZEV mandate and is willing to relax electric car sales targets between 2027 and 2035. However, during the consultation, it became clear that the policy will be less watered-down than initially thought.
As reported by the FT, the government under Andy Burnham now takes the position that, by 2030, 60 per cent of all new cars in the UK must be fully electric – rather than the 80 per cent previously required by the current ZEV mandate. Additionally ,the remaining 40 per cent must be hybrid vehicles. Pure petrol and diesel cars will thus no longer be eligible or registration from 2030.
According to the FT, this information comes from “trusted circles.” The report states that Burnham’s government, as part of the ongoing consultations, has asked the industry about the proposed 60 per cent BEV target for 2030. Reactions to this proposal remain unclear, although the UK automotive industry had actually expected a more substantial relaxation of the rules. Prior to the consultation, both Ford and Nissan had already called for the new car sales target to be reduced to 40 or 50 per cent BEVs. Additionally, Peter Kyle – who served as Economic Secretary for Burnham’s predecessor, Sir Keir Starmer (under whom the consultations were still being prepared) – had hoped to lower the EV quota for 2030 from 80 to 50 per cent.
The FT reports that the proposed 60 per cent target is itself contentious within Burnham’s government: “The business department is keen to cut the mandate as much as possible to help the UK’s car industry, which is under pressure from Chinese competition and wants a slower transition to EVs. Meanwhile, the Department for Energy Security and Net Zero (DESNZ) is pushing back as it tries to keep Britain on track with its climate targets.”
While EV registrations in the UK, as in almost all European industrial nations, have increased this year, the growth has been slower than in countries like Germany or France: the current EV share stands at 26 per cent – up from 22 per cent the previous year. UK-based automakers have long argued that the planned increase in the ZEV Mandate from 38 per cent next year to 80 per cent by the end of the decade is unrealistic.
https://www.electrive.com/2026/10/19/uk-government-to-ease-ev-sales-mandate-but-only-slightly/
Russian oil exports via the Northern Sea Route (NSR) in 2026 are already nearly 50 percent higher than last year's volume, with about 20 million barrels shipped to Asia from the start of the navigation season in July to mid-October, traders said, with data confirming the trend, Reuters reported.
The Northern Sea Route connects western Russian ports with Asian markets across the ice-covered waters of the Arctic and is considered a more dangerous and expensive route. But this year it has become more attractive due to disruptions to shipping through the Suez Canal, the Strait of Hormuz and the Black Sea region, traders said.
Tanker oil rates have soared to record levels as wars in Iran and Ukraine have increased inflationary pressures and made U.S. crude unavailable to Asian refiners, forcing them to seek alternative supplies from the Middle East and Latin America.
That has made the high fees for ships using the Northern Sea Route, which requires icebreaker assistance, less onerous than the costs of the usual route to Asia via the Red Sea, traders said.
For Russia, which controls the Northern Sea Route, it provides a safe alternative to European waters, where tankers carrying Russian oil have been detained multiple times this year.
According to preliminary estimates by traders, the volume of Russian oil exported via the Arctic route could grow by another 5-10 million barrels by the end of the navigation season. Last navigation season, Russia shipped 13 million barrels.
„Gazprom Neft“ (Gazprom Neft), one of Russia's major oil companies, will increase its deliveries via the Northern Sea Route by about 35 percent this year compared to 2025, Chief Executive Officer Alexander Dyukov told reporters in Moscow on Friday.
Russia ships significant amounts of liquefied natural gas (LNG) to Asia via the Northern Sea Route, as well as other goods. LNG shipments along the route are also expected to increase this year after Arctic LNG shipments begin.
In September, President Vladimir Putin told an economic forum in Vladivostok that Russia expects annual cargo throughput along the Northern Sea Route to double to 70 million tons by the end of the decade.
Rosneft's new large-scale oil project in northern Russia, Vostok Oil, which opened last month, is already contributing to the increase in volumes transported along the Northern Sea Route.
https://fakti.bg/en/world/1091878-russian-oil-exports-via-arctic-rise-amid-global-shipping-crisis
European Commission President Ursula von der Leyen said the EU has no intention of lifting sanctions on Russian energy resources before the war ends.
"We have placed energy sanctions on Russia due to its war of aggression against Ukraine. These sanctions will stay until Russia stops the war," she said on Wednesday, addressing the European Parliament on the outcome of the European Council meeting held on October 15–16.
She stressed that it was Russia, not the European Union, that cut off gas supplies to Europe in 2022.
"Russia is not a trusted supplier of energy. Because it would rather weaponized energy dependencies – to blackmail others. That is a lesson that Europe will never forget," von der Leyen said.
Her remarks came amid a report by The New York Times that the United States had allegedly proposed bringing Russian pipeline gas back to the European market as part of a potential peace deal to end the war between russia and Ukraine. The Donald Trump administration reportedly believes this could provide Russia with an economic incentive to agree to a peace deal.
According to the NYT, European officials reacted negatively to the proposal because it runs counter to the EU's long-standing policy of reducing its dependence on Russian energy.
European Commission spokesperson Paula Pinho confirmed on October 19 that the EU has no intention of lifting energy sanctions on Russia until the war is completely over.
Silvercorp Metals (TSX: SVM) produced 0.9 million ounces of silver in its fiscal second quarter, down 41% from a year earlier, as safety upgrades at the Ying Mining District cut deep into mill throughput.
Ying processed 213,320 tonnes of ore in the three months ended September 30, a 20% decline year over year. Output also included 1,371 ounces of gold, 7.6 million pounds of lead and 0.7 million pounds of zinc, while silver equivalent production came to 1.0 million ounces, down 42%. The decline lands within the 40% to 50% impact the company flagged at the end of June.
Grades softened as well. Silver-lead ore at Ying averaged 157 g/t silver and 2.0% lead, compared with 207 g/t silver and 2.6% lead a year ago, and gold ore graded 1.1 g/t gold against 1.4 g/t. Recoveries held up better, with silver at 94.1%, gold at 92.9% and lead at 90.4%, although zinc recovery slipped to 57.7% from 65.8%.
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By quarter end, Ying was back running at a 90% operating rate. The company completed tunnel enlargement, equipment upgrades and a full replacement of power cabling, spending US$13.4 million on the work during the quarter.
The GC Mine contributed next to nothing. Mining there has been suspended since late June pending an updated mine development design, and the operation processed just 477 tonnes of stockpiled ore. Silvercorp does not expect GC to resume production until November 2027, though the mine accounts for less than 10% of total revenue.
Revenue fell 13% to US$72.1 million. An 82% jump in the average realized silver price to US$61.83 per ounce, along with a realized gold price of US$3,955 per ounce, offset much of the lost volume.
Through the first half of fiscal 2027, the company has processed 600,250 tonnes and produced 2.4 million ounces of silver, 3,907 ounces of gold, 21.2 million pounds of lead and 5.2 million pounds of zinc. Full year guidance calls for 6.8 million to 7.1 million ounces of silver and 9,500 to 10,000 ounces of gold, putting Silvercorp at roughly 35% and 41% of the low end of those ranges at the halfway mark. That guidance was issued in April, before both the Ying disruption and the GC suspension, and the company has not revised it to reflect the changes.
Silvercorp is scheduled to release its second quarter financial results on November 5.
Silvercorp Metals last traded at $13.78 on the TSX.
Information for this briefing was found via the sources and the companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
YEREVAN— Russian-born American investor Konstantin Sokolov plans to redirect production from Armenia’s Teghut copper and molybdenum mine toward the United States, potentially reducing the mining operation’s reliance on Chinese markets.
In an interview with Bloomberg, Sokolov said most of Teghut’s output currently goes to China but that new commercial agreements are expected to redirect shipments to American buyers following the expiration of existing contracts in December.
Sokolov’s US-registered investment company, Dynamic Frontier Holdings, acquired Teghut this year from Russian state-controlled VTB Bank, which had held significant interests in the mine.
The transaction received special authorization from US authorities because VTB remains subject to American sanctions.
Sokolov said the acquisition aims to modernize the mine, increase production and strengthen economic cooperation between Armenia and the United States.
He also heads the $201-million Trans-Caspian Enterprise Fund, a US-backed investment initiative supporting infrastructure, energy and private-sector development across the South Caucasus and Central Asia.
However, Reuters has raised questions about potential conflicts of interest arising from Sokolov’s private investments in Armenia and his leadership of a fund backed by the US government.
His extensive business history involving Russia has also drawn scrutiny, particularly given Washington’s efforts to expand its strategic presence in the region.
The planned redirection of Teghut’s exports reflects growing American interest in Armenia’s mineral resources and the changing balance of Russian, Chinese and US economic influence in the South Caucasus.
BHP’s copper production fell 19% in the September quarter after severe weather, lower grades and maintenance affected its Chilean operations, Bloomberg reported.
The world’s biggest miner produced 400,700 tons of copper in the three months to September but kept its full-year production forecast unchanged.
BHP said the decline reflected planned reductions in ore grades, scheduled maintenance and temporary disruption from severe weather in Chile.
CEO Brandon Craig described the period as “maintenance-intensive” and said geopolitical tensions, trade uncertainty and high energy and freight costs remained industry headwinds.
BHP’s shares fell as much as 2.6% in early Sydney trading.
Chile is home to BHP’s biggest copper operations, including Escondida, the world’s largest copper mine. The company last week averted a strike at Escondida.
BHP realised an average copper price of $7.01/lb during the quarter, 53% higher than a year earlier.
Citigroup analyst Thiago Ojea said stronger copper prices should more than offset the weaker production, although Escondida’s ore grades remained a key variable.
Iron ore production was steady at 66.5 million tons, while BHP maintained its full-year iron ore forecast of 260 million to 272 million tons.
The miner also said its Jansen potash project in Canada remained on track for first production next year.
https://miningmx.com/2026-10-20-bhp-keeps-copper-forecast-despite-19-output-fall/
BAKU, Azerbaijan, October 20. Kazakh President Kassym-Jomart Tokayev met with China Nonferrous Metal Mining Group (CNMC) Chairman Wen Gang after launching construction of the Aktogay copper smelter in the Abai region via video link, according to the Kazakh presidential press service.
Tokayev highlighted CNMC's international experience in mining and metallurgy and its contribution to developing Kazakhstan's industrial capacity. He said the project would give additional impetus to economic development in the Abai region and Kazakhstan's manufacturing industry.
Wen Gang thanked Tokayev for his trust in CNMC to implement the project and for taking part in the construction launch ceremony. He assured the president that the company would carry out construction using advanced technologies and within the established timeframe, with particular attention to industrial and environmental safety.
Wen Gang said the project would also expand cooperation in local workforce training and the exchange of expertise.
The two sides noted that the project would serve as an example of industrial cooperation between Kazakhstan and China and provide a basis for further joint work in metallurgy and deeper processing.
Earlier today, Tokayev launched construction of the Aktogay copper smelter via video link. The plant, being developed by KAZ Minerals Group with China's NFC as the engineering partner, will have an annual capacity of 300,000 tons of cathode copper. The first copper cathode is scheduled to be produced in 2030, and the project is expected to create more than 1,000 jobs.
The new plant’s production capacity is expected to be around 2 million tonnes per year
The Australian Government has granted final approval to the South Korean steelmaker Posco Holdings Inc. to build a low-carbon iron ore processing plant. The project will be carried out in Port Hedland — a key export hub in the Pilbara region (Western Australia). This was reported by Bloomberg.
The total investment is estimated at approximately 4.4 billion Australian dollars (around $3 billion). The new plant is expected to have a production capacity of around 2 million tonnes per year.
Australia is the world’s largest exporter of iron ore, but the country lacks the capacity to process it further domestically. The implementation of this project will enable the country to increase the added value of the raw material domestically and will support the wider efforts to decarbonise industry.
The final investment decision depends on agreement with Posco’s partners, which include Japan’s Marubeni Corp. and Taiwan’s China Steel Corp. The launch of the first phase of production is scheduled for 2031.
To reduce harmful emissions, Port Hedland Iron will use natural gas instead of coal. In the future, the company plans to switch entirely to ‘green’ hydrogen, the combustion of which leaves no carbon footprint at all.
According to the International Energy Agency, the steel industry currently accounts for around 8% of global carbon dioxide emissions. This sector is considered one of the most challenging in terms of environmental transformation, which is why the transition to new technologies is a critically important step for the entire industry.
As reported by GMK Center, the Australian government will provide up to 26 million Australian dollars ($18.6 million) to the start-up Element Zero. These funds will be used to support a pilot project for the electric-powered processing of iron.
The total cost of the project is 53.6 million Australian dollars. Its aim is to produce high-quality iron with low emissions. The plan is to use various types of Australian iron ore as raw material, including haematite and magnetite.
