Vale S.A. - ADR

Sales and Production Performance: Vale reported a 4% year-on-year increase in iron ore sales, totaling 66 million tons, while production decreased by 4%. This reflects operational challenges exacerbated by higher rainfall. The company is maintaining a flexible product portfolio to maximize value during times of challenging margins in the steel industry.

Financial Snapshot: The pro forma EBITDA for the quarter was $3.2 billion, an 8% decline year-on-year, attributed to a 16% decrease in iron ore prices. Nonetheless, Vale achieved an 11% reduction in C1 cash costs, reaching $21 per ton, and all-in costs fell by 7% to $54.4 per ton, indicating strong cost management amidst declining revenues.

Growth Projects and Future Production: Vale's iron ore growth projects, Vargem Grande and Capanema, which started operations in late 2024, are expected to produce a combined 40 million tons in 2025. The Plus 20 project at S11D is also on track to begin operations in the second half of 2026, supporting production guidance and improving portfolio flexibility.