NEW YORK (TheStreet) -- Shares of Brazilian iron ore producer Vale (VALE) were flat at $7.11 in early afternoon trading Thursday after peer company BHP Billiton (BHP) defended its strategy of increasing iron ore output during a global oversupply.
The company stood by its approach even as iron ore prices have declined approximately 40% in the past 12 months.
"This is a market which is highly competitive. It's cyclical, and so our performance will be dependent on being the most efficient supplier and it shouldn't be dependent on supply restraint," BHP iron ore marketing VP Alan Chirgwin said at a conference, according to Bloomberg.
Chirgwin added that global iron ore supply could grow by 100 million to 110 million metric tons this year, but demand is only estimated to grow by 30 million to 40 million metric tons. He also noted that "supply growth over the last 12 months has outpaced demand growth and that will keep pressure on prices next year."
Separately, TheStreet Ratings team rates VALE SA as a Sell with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:
"We rate VALE SA (VALE) a SELL. This is driven by a few notable weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. Among the areas we feel are negative, one of the most important has been a generally disappointing historical performance in the stock itself."