Vale checking alternatives for nickel assets amid challenging scenario
Brazilian miner Vale is studying alternatives for its nickel portfolio including selling, making partnerships or putting assets in care and maintenance, as the market faces a challenging short-term scenario, its CEO said on Tuesday.
Chief executive Gustavo Pimenta told reporters in Rio de Janeiro the market is oversupplied due to output from Indonesia. “Nickel remains attractive in the medium and long-term,” he said, citing demand for electric cars production.
“The question is how to remain profitable in the short term,” the executive added.
The CEO noted Vale must work to improve efficiency of its assets, and cut costs to have a profitable nickel business within current market prices.
“We are evaluating if some assets in the portfolio could have a strategic alternative,” Pimenta added.
In January, Vale said its subsidiary Vale Base Metals had started a “strategic review” of its nickel assets in Thompson, Canada, including their potential sale.
Pimenta also said on Tuesday that Vale has started to reverse in April the iron ore production decline it reported in the first quarter of the year, adding he is “very confident” that the miner will meet its 2025 production guidance for the steel-making ingredient.
The executive noted the company could again be the world’s largest iron ore producer if rivals such as Rio Tinto miss their output estimates for the year.
(By Rodrigo Viga Gaier, Gabriel Araujo and Andre Romani; Editing by Chris Reese and Aida Pelaez-Fernandez)
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Comments
Interesting information. Vale is well aware of the significant growth of the nickel demand. I just hope they will not sacrifice the long term gains with short term “savings” by dismantling the nickel operations beyond revival when the market turns around.