Brazil's Vale hits iron ore production record in 3rd-qtr

(Adds suspension of operations at higher-cost mining operations, paragraphs 2-3)

BRASILIA, Oct (HKSE: 3366-OL.HK - news) 19 (Reuters) - Brazilian miner Vale SA said on Monday it produced 88.2 million tonnes of iron ore in the third quarter, an all-time high for the company, as it continues to raise output into an already oversupplied market.

Despite the new record, the world's No. 1 iron ore miner also suspended higher-cost mining operations accounting for about 13 million tonnes of annual production.

They will largely be replaced by ore coming onstream from new lower-cost mines in a move to improve profit margins in the face of weak global iron ore prices.

The company's record production keeps up pressure on Australian rivals BHP Billiton (NYSE: BBL - news) and Rio Tinto (LSE: RIO.L - news) who are engaged in a battle for market share as an iron ore price slump forces smaller producers to close. The price of iron ore has fallen to $52.50 per tonne from a high of nearly $200 in 2011.

Vale said it also produced 71,600 tonnes of nickel and 2.05 million tonnes of coal in the period. (Reporting by Stephen Eisenhammer Edited by W Simon)