Vale – Page 45 – Republic of Mining

UPDATE 2-Vale posts $2 bln loss on weak Brazil currency, low iron ore prices – by Stephen Eisenhammer and Marta Nogueira (Reuters U.S. – October 22, 2015)

October 23, 2015

http://www.reuters.com/

Oct 22 (Reuters) – Brazilian miner Vale SA on Thursday posted a net loss of $2.1 billion in the third quarter due to low iron ore and nickel prices and a weakening real against the dollar.

The result was slightly less than analysts forecast, and shares in Vale rose by 2 percent in morning trade as investors responded favorably to the world’s No.1 iron ore miner cutting production costs and debt.

Vale produced a record amount of iron ore during the period and reduced cash costs to $12.70 a tonne, which it says is the lowest in the industry.

Despite rising production, Thursday’s loss is Vale’s fourth in five quarters. The company is struggling to absorb the cost of building a giant new mine in Brazil’s Amazon region as its cash take drops. The miner posted net revenue of $6.51 billion and adjusted EBITDA of $1.88 billion.

Iron ore competition runs hot as Vale hits production record – by Amanda Saunders (Sydney Morning Herald – October 20, 2015)

October 20, 2015

http://www.smh.com.au/

Australia’s iron ore wars may have died down but fierce global competition in the commodity has not, with Brazil this week clocking a new production record, and former Rio Tinto chief executive Tom Albanese starting exports from India after a three-year impasse.

Brazil’s Vale posted a quarterly production record of 88.2 million tonnes for the three months to September, despite pulling marginal tonnes out of the market. Productivity campaigns at its lower-cost operations helped offset the production cuts, edging its output 2.9 per cent higher than the period a year earlier.

Australia’s big two, Rio and BHP Billiton, also continue with their expansions, while Fortescue is running at about 165 million tonnes a year after a rapid three-year expansion.
Depressed iron ore prices have stabilised in recent weeks, trading around $US55 a tonne, after months of wild volatility. Iron ore has averaged about $US60 a tonne this year.

Action against Vale rare: Mining watchdog – by Carol Mulligan (Sudbury Star – October 10, 2015)

October 13, 2015

The Sudbury Star is the City of Greater Sudbury’s daily newspaper.

The enforcement action Environment Canada took Thursday against Vale Canada Ltd. is very rare in Canada, says a spokeswoman for a mining watchdog group.

Environment Canada enforcement officers, with support from Royal Canadian Mounted Police, executed a search warrant at Vale’s engineering building Thursday. The warrant was part of an active Environment Canada investigation that began in November 2012, said Nathalie Huneault of Environment Canada.

The investigation relates to alleged violations of the general prohibition in the Fisheries Act, which prohibits the deposit of substances that are deleterious to fish into water frequented by fish, she said. Huneault said Environment Canada couldn’t comment further because the matter is under investigation.

Vale spokeswoman Angie Robson said Environment Canada was on site Thursday “collecting information related to alleged infractions under the Fisheries Act that allegedly occurred in 2012. Vale is co-operating fully in providing the information required.”

Police raid Vale office in Sudbury – by Carol Mulligan (Sudbury Star – October 9, 2015)

October 9, 2015

The Sudbury Star is the City of Greater Sudbury’s daily newspaper.

Three sources have told The Sudbury Star that police and Environment Canada officials raided Vale’s general engineering building in Sudbury on Thursday as part of an investigation into what one source said was a spill affecting fish and wildlife.

A source said Royal Canadian Mounted Police and Environment Canada employees spent four hours removing files, cabinets and computers with passwords from the Vale building on Lorne Street in Copper Cliff.

Another source said police and government officials seized all files, passwords and data from the environmental department, located in the engineering building.

“And they were collecting security cards after the employees left, so they couldn’t come back to the building,” said the Vale employee, who provided the information to The Sudbury Star on the condition of anonymity.

Vale’s Sudbury spokeswoman Angie Robson confirmed that Environment Canada was on site Thursday “collecting information related to alleged infractions under the Fisheries Act that allegedly occurred in 2012.

Nickel crisis rocks French islands in Pacific – by Claudine Wery (AFP/Yahoo.com – October 4, 2015)

October 5, 2015

https://en-maktoob.news.yahoo.com/

Plunging nickel prices and the market woes of world mining giants have shaken the French territory of New Caledonia, a tropical archipelago in the Pacific that is hostage to the metal’s fortunes.

Though best known for its stunning lagoon, pristine beaches and diverse wildlife, New Caledonia’s economy actually relies heavily on nickel, discovered here in the 19th century.

The price of nickel — essential to the manufacture of stainless steel — has plunged 35 percent so far this year to a six-and-a-half year low of less than $10,000 (9,000 euros) a tonne.

A slowdown in economic growth in China, the world’s biggest consumer of nickel, and stockpiles of the metal amounting to more than 450,000 tonnes, have depressed the market.

“We were already in a deteriorating situation when the crisis hit because every sector was in a slowdown. I think we are not far from zero economic growth,” Catherine Wehbe, director of the employers’ federation Medef in New Caledonia, told AFP.

Vale Gain Spells Iron Pain With Giant Mine Ahead of Schedule – by Danielle Bochove and Juan Pablo Spinetto (Bloomberg News – October 1, 2015)

October 1, 2015

http://www.bloomberg.com/

The world’s top iron-ore producer has some bad news for the oversupplied market: its biggest project is running ahead of schedule.

S11D, part of the Carajas mining complex in northern Brazil, is on track to beat a targeted December 2016 start date, Vale SA Chief Financial Officer Luciano Siani said in an interview Wednesday.

The project — the industry’s largest and, according to Vale, the most profitable — will add 90 million metric tons of annual capacity to global supply, although Vale intends to control the speed at which it hits the market, Siani, 45, said in Toronto, where he is holding meetings with investors and analysts.

“We will manage the ramp up in order to preserve the premium for this high grade ore,” he said.
While S11D coming on stream sooner than planned would be a boon for Vale’s debt-reduction ambitions, it looms as another strain on an iron-ore market buffeted by a series of expansions by Vale and its main rivals in Australia at a time of slowing Chinese growth.

World’s best coming to Sudbury for mining games – by Keith Dempsey (Sudbury Star – September 29, 2015)

September 29, 2015

The Sudbury Star is the City of Greater Sudbury’s daily newspaper.

The Nickel City will host the 2016 International Mines Rescue Competition. Hosted by Workplace Safety North and Ontario Mine Rescue, the event will bring mine rescue teams from around the world for the competition, which will be held from Aug. 19-Aug. 26.

Vale, Glencore, KGHM, Goldcorp and Drager are sponsoring the event.

“Quite frankly, the competition we’ll see is second to none,” Alex Gryska, Canada International Mines Rescue Competition co-ordinator, said. “If you take a look at this event, you’re going to have volunteers and full-timers (taking part), so you’ll have individuals that are in this event who are full-time mine rescue responders, so the level of capability will be extremely high.”

Hosting the International Mines Rescue Competition in Canada has been something Gryska has been chasing for years.

“I’ve been connected with the International Mines Rescue body since 2001, and my colleagues oversee mine rescue in their respective organizations, so I’ve been connected with them,” Gryska said.

Vale offers contrarian view of China steel output (Bloomberg/Sydney Morning Herald – September 24, 2015)

September 24, 2015

http://www.smh.com.au/

Vale reacted to claims steel consumption in China has peaked and, in a view that contrasts with a rising number of global banks, says demand in the top user still has some way to go.

“China’s steel consumption peak is still ahead of us but of course the growth will be much more gradual,” said Claudio Alves, Vale’s global director of ferrous marketing and sales. Vale aimed to boost its market share, he said.

The largest miners are seeking to figure out the implications of slowing growth on China’s demand for everything from iron to copper. While Vale’s view echoes outlooks from Rio Tinto and BHP Billiton, ANZ Bank brought forward its peak-steel estimate to 2014 from 2020 and Credit Suisse Group said local consumption will shrink 10 per cent by 2018. Citigroup warned on Tuesday commodities may see further losses amid excess supplies and a sluggish global economy.

“Despite the slowdown of the growth speed, China still remains the economic engine of the world,” Mr Alves said before the start of a conference in Qingdao. Further urbanisation and infrastructure projects will underpin demand for iron ore, steel, copper and other base metals, according to Alves.

UPDATE 2-Vale vows deeper iron ore cost cut as China’s steel demand peaks – by Manolo Serapio Jr and Ruby Lian (Globe and Mail – September 23, 2015)

September 23, 2015

http://www.reuters.com/

QINGDAO, China, Sept 23 (Reuters) – Iron ore miner Vale said it will cut its production cost to less than $13 per tonne by 2018, as the world’s largest producer of the commodity maximises profit margins in an era of weak prices.

A global glut and falling Chinese steel demand have dragged iron ore prices to less than $60 a tonne from a high of nearly $200 in 2011. The price is forecast to drop to $50 over the next two years, a Reuters poll showed.

“Vale is progressing to reach the lowest cash cost of the industry and will be competitive at any price scenario,” Claudio Alves, global director of marketing and sales at Vale, told a conference in China’s port city of Qingdao.

The cost reduction will come after the completion of Vale’s 90-million-tonne expansion project known as S11D in the Brazilian Amazon, Alves said, as the miner focuses on producing more high-quality material.

Vale’s overall cost stood at $15.80 per tonne by the second quarter.

Vale Rules Out Following Glencore Path as Mining Pain Deepens – by Juan Pablo Spinetto (Bloomberg News – September 15, 2015)

September 16, 2015

http://www.bloomberg.com/

The world’s top iron-ore miner is betting that cost cuts and growing market share will be enough to endure low prices, shunning the path of equity sales and halted dividends taken by rival Glencore Plc.

Vale SA, the Brazilian mining giant which is also the largest nickel producer, is focused on reducing expenses further as the start of its lowest cost producing project approaches, Chief Executive Officer Murilo Ferreira told reporters in Belo Horizonte, Brazil, during an industry gathering.

“We aren’t studying a model like the one taken by Glencore, because we don’t consider it necessary for Vale,” Ferreira said, adding that he only has “superficial” knowledge of the operations of the Baar, Switzerland-based trader.

“The Vale team did the diagnosis of the end of the supercycle at the right moment. There was an expressive reduction in Vale’s costs and there is a lot still to come.”

UPDATE 1-Petrobras chairman to take leave, to focus on job as Vale CEO – by Stephen Eisenhammer and Rodrigo Viga Gaier (Reuters U.S. – September 14, 2015)

September 14, 2015

http://www.reuters.com/

(Reuters) – Murilo Ferreira will take a leave of absence as chairman of state-run oil firm Petrobras, turning his full attention to his job as chief executive of Vale SA as the mining giant grapples with a downturn in the sector.

Petroleo Brasileiro SA, as the company is formally known, did not give a reason for Ferreira’s leave, which it said would last until Nov. 30. A company source told Reuters he had requested time off to focus on Vale as it navigates a slump in iron ore prices and a slowdown in China.

Ferreira, 62, who has been CEO of Vale since 2011, was appointed chairman of Petrobras in April as it looked to send a market-friendly signal after a giant corruption scandal resulted in billions of dollars in writedowns.

At the time some mining executives criticized the move, saying Vale was going through a difficult patch and needed the full focus of its CEO. Ferreira shrugged off concerns, saying the double job would only eat into his “leisure time.”

But the world’s largest producer of iron ore has continued to struggle. Shares in Vale have lost nearly 40 percent over the past 12 months and touched their lowest in a decade last month.

Political leadership vacuum exacerbates Brazil’s economic crisis – by Stephanie Nolen (Globe and Mail – September 14, 2015)

September 14, 2015

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

RIO DE JANEIRO — When Standard & Poor’s downgraded Brazil’s sovereign debt last week, the news had a certain feeling of inevitability here – just the latest in a seemingly unending streak of terrible economic news.

The real closed at its lowest value in 13 years against the U.S. dollar on Friday, at just $0.258. That’s a drop of almost 40 per cent from a year ago and 60 per cent from 2011 levels. Meanwhile the GDP is expected to contract by 2.4 per cent this year, the worst recession in 25 years. Other investment ratings are expected to follow S&P to junk status imminently. Inflation is higher than it has been since the turn of the century. The jobless rate nearly doubled in the first five months of this year.

It is hard to imagine the situation could get much worse – and yet there is a sense here that it almost certainly will.

Consumer demand is in free fall, which will only drive unemployment higher, in an ugly spiral. The real is expected to continue its fall, with some analysts predicting it will drop by another 16 per cent. And rather than a knuckled-down government attempting to navigate the crisis, Brazil has a gaping leadership vacuum and a political stalemate.

Vale CEO still upbeat on China, iron ore market -paper (Reuters U.S. – September 4, 2015)

September 4, 2015

http://www.reuters.com/

SAO PAULO – China’s stock market crash and currency devaluation have not dampened the optimism of mining giant Vale’s chief executive, who said he is most upbeat on the iron ore market in two years, according to a newspaper interview published Friday.

China’s stock markets have little relation to its real economy and a new foreign exchange policy has been misinterpreted as stimulus for exports, Vale CEO Murilo Ferreira told newspaper Valor Economico.

“The outlook for iron ore in recent weeks is much better than we saw four months ago. Of the last 24 months, I’m most upbeat right now,” said Ferreira.

The sharp Chinese sell-off in recent weeks rattled global markets, but Ferreira played down those fears and said the devaluation of the yuan was a step toward making the currency convertible.