Iron ore giant Vale has a secret but it is not telling – by Cecilia Jamasmie ( – September 25, 2013)

Brazilian miner Vale (NYSE: VALE), the world’s biggest iron ore firm, is considering more non-core asset sales by the end of the year, but it is also working on a deal that could shock the market, said Chief Executive Murilo Ferreira yesterday.

After a speech at the Brazilian Mining Congress, the executive told reporters Vale was evaluating whether to sell its 22% stake in aluminum producer Norsk Hydro ASA (STO:NHYO), as well as its 40% stake in Brazilian bauxite miner Mineracao Rio do Norte SA. The company is also evaluating what to do with its remaining oil and gas assets.

“We also have a surprise that I won’t mention so you remain curious,” Ferreira told reporters Tuesday, after a speech at the Brazilian Mining Congress, according to Bloomberg.

Iron ore prices to hold

The miner is quite bullish about global iron prices, as it sees demand from China, the world’s top iron ore consumer, likely to moderate next year. The executive director for ferrous and strategy, Jose Carlos Martins, said Wednesday the firm was expecting prices to be in range of $120-$130 a tonne in the fourth quarter.

The Rio de Janeiro-based firm has been selling assets, cutting investments and putting projects on hold as falling metal and mineral prices led last year to its lowest annual profit since 2009.

Since iron ore prices fell to a three-year low in September last year, the mining giant has put its $1.26 billion Zogota project in Guinea’s Simandou on hold last October and, earlier this year, it halted work indefinitely at its $5.9 billion potash project in Argentina.

In addition, the company is also said to be selling its Canadian $3bn Kronau potash project, after putting it on hold last year.

Iron ore traded in 2012 as high as $150 a tonne and as low as $87.50 a tonne, making it one of the worst performers in the international commodities market.

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