Vale, the name of this place at first sound like a beautiful tourist attraction but is the nightmare of iron ore futures investors in recent days, in fact, Vale's full name is "Vale of Brazil", as the world's largest and most produced iron ore producer, but also the largest mining company on the American continent, known as Brazil's "crown jewel" and "engine of the Amazon", is a large multinational company, every move affects the global iron ore price. The recent sharp rise and fall in iron ore futures prices is crucial to Vale's production and transportation capacity. Domestic commodity futures are often affected by the news surface, and this time is no exception. Today I will briefly sort out for you the role of Vale in the rise and fall of iron ore in recent days.

1. Vale's past and present

Of the world's three largest iron ore suppliers, Vale is the largest company, the remaining two being Australian-based BHP BILLITON and Rio Tinto Group. Founded on June 1, 1942, Vale Brasil also deals in manganese ore, aluminum, gold ore and other minerals as well as pulp, ports, railways and energy in addition to iron ore. The company began privatization and a major merger of iron ore companies on May 7, 1997. In early 2000, Vale acquired not only SOCOIMEX, but also all of Samitri Mines. Brazil is extremely rich in iron ore resources, accounting for 6.5% of the world's total reserves, and is the world's largest producer of iron-rich ore. Today, Vale accounts for 80% of Brazil's total iron ore production.It can be said that Vale has mastered the lifeblood of iron ore in Brazil as a country, and it is not an exaggeration to say that it has mastered the lifeline of the economy.

The gradual fermentation of the dam failure has also led to a rethinking of the environmental protection and mining industries in Brazil.

At present, due to the impact of the mining disaster, Vale iron ore supply has reduced a total of 63.8 million tons of production capacity per year, including:

1. Mina Feijo mining area 8 million tons;

2. Brucutu mining area 30 million tons;

3. Vargem Grande mining area 13 million tons;

4. Timbopeba mine 12.8 million tons;

5. In addition, there is still 19 million tons of planned production capacity waiting to be shut down.

The development of the dam failure accident has actually led to a sharp rise in domestic and foreign stocks and futures markets. However, after a series of operations by Vale and the gradual relaxation of the Brazilian government, the people have forgotten the matter, and several Vale mining areas in the Brazilian region have gradually resumed operations. The latest news received this morning (3.20) is Vale's announcement that the company has been allowed to restore the right to export iron ore to four ports (Madeira Maritime Terminal, Port Tubbarão, Guaiba Terminal and Itaguaí Maritime Terminal), and the Brucutu mine mentioned above has entered the process of resuming production, which is much shorter than the original expected resumption of production, and has a greater impact on the market in the short term, which has caused the situation of iron ore opening gap plunge this morning.

What can we do in the face of sudden "black swans"

First of all, the actual position opening process is the best moment to guard against black swans. Strictly control the position and maintain a light position, which can cope with violent market changes and sharp rises and falls.

Secondly, pay close attention to the information impact on the news surface, so as to prevent problems before they occur, avoid the varieties of recent information bursts or adjust the direction of opening and closing positions according to changes in information.

Finally, to ensure a good attitude, the market will often produce some pullbacks and adjustments after drastic changes, you can grasp the trading opportunities in the short cycle, control the transaction cost and do a good job of taking profit, stop loss while carrying out short-cycle operations.