By Paul Kiernan 

RIO DE JANEIRO -- Brazilian mining company Vale SA reported a surge in its third-quarter earnings Thursday thanks to higher global prices for iron ore and widening quality premiums.

Vale, the world's largest iron-ore producer, said its net profit nearly quadrupled to $2.23 billion in the July-to-September period thanks to a combination of rising prices, greater production and a stronger Brazilian real. Given its large U.S. dollar debt, Vale's bottom line is sensitive to currency changes.

Benchmark prices for iron ore, the raw material used to make steel, rose 21% in third quarter to $70.9 per metric ton. This, combined with higher production and sales volumes, drove a 35% increase in Vale's revenue, to $9.05 billion.

China, by far the largest global steel producer and Vale's most important market, increased its output of the industrial metal by 8.1% in the third quarter from a year earlier thanks to growing demand in real estate and infrastructure, according to Vale.

In addition, Chinese steel mills paid a larger premium for high-quality ores, which are cleaner and more efficient to process. Vale, which produces some of the purest iron ore on the market, has characterized this as a long-term trend driven by stricter environmental controls.

Vale's adjusted earnings before interest, taxes, depreciation and amortization, or Ebitda, rose 41% to $4.19 billion.

Write to Paul Kiernan at paul.kiernan@wsj.com

(END) Dow Jones Newswires

October 26, 2017 08:49 ET (12:49 GMT)