Brazil’s Vale mining company will reduce output of nickel in its Canadian operations and has launched a voluntary retirement program to cut jobs worldwide, the company announced Thursday.

Falling nickel prices are responsible for the decision, Companhia Vale do Rio Doce SA said in a statement. In October, Vale announced similar production cutbacks for its nickel operations in Indonesia.

“In face of the uncertainties embedded in the current global economic scenario Vale retains the optionality to manage production according to its assessment of market conditions,” the company said.

The Copper Cliff South mine in Canada’s Ontario province will be shut down indefinitely. Vales Voisey’s Bay operations in Newfoundland and Labrador that make nickel and copper concentrates will be closed for the month of July.

Another project planned for Copper Cliff will be postponed. Vale’s Inco unit, created in 2006 after Vale bought Inco Ltd., oversees all of the operations affected by the reductions.

Vale did not state how many jobs will be affected in Canada, but said the Inco unit will offer a voluntary retirement program for eligible employees “and pursue other initiatives to reduce costs.”

On Wednesday, Vale said it cut 1,300 jobs from its work force of 62,000 since the global meltdown occurred and sent demand plummeting for metals.

The job cuts amounted to a 2.1 percent reduction at the world’s largest iron ore producer. The company said an additional 5,500 workers are being idled with pay to slow iron ore production, and 1,200 are being retrained for new assignments.

Vale’s shares on Brazil’s Bovespa exchange were down 2.3 percent in late-morning trading in Sao Paulo while the exchange’s main index was up 0.1 percent.

Find More Other News : Company, Exploration, Mine Trade & Market, Mining Investment, Mining Jobs, Nickel Mine