Brazilian miner Vale will not chase big acquisitions – by Neil Hume (Financial Times – October 16, 2018)

Brazilian mining company Vale will deploy its cash wisely and “does not need” to chase big acquisitions because it has a big opportunity to grow organically in nickel.

Speaking at the FT Commodities Global Summit in Rio de Janeiro on Tuesday, Vale chief executive Fabio Schvartsman said big dealmaking “adventures” were not on his agenda and any acquisitions would be small bolt on deals, probably in iron ore.

“We don’t need to do it given the potential of our nickel business,” he said. Although Vale is best known for its huge iron ore business, it is also the world’s biggest producer of nickel, a metal that will be needed in greater quantities as electric vehicles go mainstream.

Along with cobalt and lithium, nickel is a key material in the battery packs that power EVs.

However, Mr Schvartsman said Vale would only go ahead and develop its giant nickel reserves in Indonesia if the price of the metal increased to $20,000 a tonne from its current price of $13,000 a tonne.

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