Vale (VALE) 27 Apr 212021 Q1 Earnings call transcript

Good morning ladies and gentlemen. Welcome to Vale's conference call to discuss First Quarter 2021 results. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and- answer session and instructions will be given at that time. [Operator Instructions] As a reminder, this conference is being recorded and the recording will be available on the company's website at vale.com at the Investors link. accompanied link slide and at via as is at also is call Internet Investors the the well. conference by presentation, a available transmitted This company's website chain the to relation audio transmitted and both delay the Internet, phone. via few second broadcasting the The slide has via a in audio

Mr. forward-looking forward-looking anticipated me could With as Act made of and statement Actual are performance under in Securities the macroeconomic proceeding, let risks Mr. statements the Reform Before Safe materially us Eduardo Litigation that from differ any mention that of market Salles Legal Operational Mr. Excellence; result Siani Vice being Harbor of are Executive Relations; a today Mark Pires, XXXX. De conditions, factors. other Vice and Bartolomeo, President, and Carlos Luciano Vice D'Ambrosio, President, President, Executive Investor Safety Officer; Mr. Finance Chief Tax. Mr. Executive Marcello Medeiros, Vice Ore: Vice Executive Travers, and Base Executive Executive Metals; Alexandre President, Spinelli, and Mr. Iron President,

Bartolomeo Eduardo the turn Mr. that, First XXXX available will to Mr. call It to Sir, now to Bartolomeo. First, now may the you Vale's my for after over will be is pleasure performance he and Eduardo presentation Quarter begin. answers. and on questions proceed

good morning everyone. Thank you,

First you of all, are I hope all fine.

of guards The up COVID Brazil. in in XXXX, our quarter we kept the first accelerated our operations pandemic as

more working and measures people of In that effective possible. Well, what's the against safety reach workforce three revision to in been this And over crisis and pandemic and do April, procedures all since as they XX kept best us. and professionals Safety, in still completed our of months these in restrictive moment dimension essential of XXXX for in as make since start only reinforce our have a urgency within are reparation, XX% measures the to the is our want priority now we have We way to critical the remote. very optimum in operations. of this allowed I requires continue all words sites. sense and our

and and focus collaborating We in most governments fight. the our have this critical with since continue been we items the efforts to communities on beginning

Vale the the of capacity Institute and million production the syringes forced intubation. of doses national companies an have million immunization to million XX of Butantan reason, production donate of XXX contribution this Ministry Vale vaccine for of for up Brazil. and X.X estimated to donation buy In medicines the with per year to of to the us For plan, for allocated resources expansion other and Health the

attentive so are people new practice that that and We is the in society. accurate is This reach our part and of need. our help directly our effective support

reparation. the promoting bringing agreement to the signing the repair As decision, I The have of the at been damage the certainty in our is strategy. became February. each meetings, end Vale another step of the of major that global final they caused in fully by A the layer ratified determined saying of at legal March direction for was settlement

of that fronts the security. water consistently of is One progress that is

our XX,XXX progressing. commissioning same Horizonte Belo structures At indemnity this people respecting of hope the remove for and in the emergence still our and main all preparation the billion emergency for integrated Talking We civil year. we of for Brumadinho document, can detail, with people. of level sum addition another pipeline ESG the of which or of are of have part presenting working is committed agreements around four effective or as metropolitan April stabilization million XX in in fair the XX, safety, to graph. another are XXXX. in structures, been as launched works up XXXX, result the economic, the to and and from conditions which a We our transformation life. listening Vale stakeholders. to works to delivery Since region impacts. we works the remain more the supply removed stability, With We a labor have is connected process to to and the environmental structures and remain Vale's hope ESG new four almost towards This the we strategy actions on to of safer XXXX, emergency X.X after business. safety the satisfactory firm Vale, about the progressing our by our prompt report of level how with information a performance helps then strongly damage individual be level the reais. to-date is culture demonstrate breach. on achieve reparation improve Last to in of with to a social seen reduce X already This water to construction time, We than end

that, XXXX, Another that our detailed since XXXX. term including one it gaps emerging totaling risk our bottom XX risks. is point closed long more management we With of gap ESG information assessment provides about plan for

of the plant. quarter, $X.X the rest Grande stabilizing capacity the volumes. and was in ore, highest results. be made resuming our we a a performance with at year; adjusted practice. We EBITDA billion, expected history a iron started compared which halted to talking for Well, In seen, Vale to the improvement now our can the in site quarter about first ambition seasonally our As into is of last is Vargem as production progress XXXX pelletzing in in the first Timbopeba reference transform ESG good operational with weaker at our

later. This which in with of production that on the with Spinelli We XX% nickel, is stable in of North this more long year. produced XXXX. Onça in In however, produce to therefore beginning to Our was XXXX. also seasonally us Refineries first than quarter of are performed a at the that gives aiming the Brazil. hyper reaching we in a of XX% planned guidance quarter, in Atlantic we give This quarter. for first in year site the lot levels harbor drop weaker, confidence as same and processes we copper operation our second because our of is stronger will details this impacting in the the improve a Salobo volumes with In Salobo’s production mine safety we reviewing operation Puma of in reaching underperformed movement. as

our due in should in COVID-XX. an was of terms had the difficulty drains, maintenance to mobilizing ENC of our another the was addressing operations of made contractors shareholders way delivered a with creation sale and our of This stakeholders. a front, local commitment to of end say, in the in On the transform solution cash a You commitment all the meets demand because we business. longer the to that XXXX important step responsible very of of

and the the Mozambique, our the stake Mitsui operations that coal logistics agreement for important signed of an step towards in acquisition also We in divestment in business.

to to and per rate made relevant million shareholders. conclusion Muatis commitment the of of sense, we In the the disciplined continue of was take of a allocate the the necessary to will of value revamp our tons of to share capital growth announcement more and XXXX. month. step of XX another options to in second the year this the half our processing actions in production, returning program presented achieve in production the commitment In to allow And evidence capital allocation, which Another discipline with summary, way. us plants shareholders speaking our more our ensure the stabilize we buyback

buyback the and bar maximize already you, of risking With and the with to we of confident deliver higher long the ability one are making summarizing is the best in company of quickly for fairly. dividends conclude, one shareholders the value believe that the does to the minimum our investments not are compromise We of set reparation Brumadinho that continuity We our for and creation policy. than progress for term.

the We continue build a path culture on of at safety Vale. to

We working stable more make operations to are hard predictable. and our

increasingly that can people safety capital in the during importantly, this pandemic. unchanged. for COVID-XX Our through communities. everything and contractors, the to high business resilience our and discipline our like are in assure XX,XXX their employees, I finally doing thank our we our linked the and critical moment ESG would are strategy of commitments guard ensure we you remains with Most I our our operations, suppliers and to customers

Now on performance who details I iron more Thank ore, the will you very floor give Spinelli pass the to of much.

the Thank million hand going side. updating reach you, Eduardo. been above to in to year. slide Well facilitate left I'm we've same the Good my all. and our start to afternoon use tons plan resumption next explanation XXX

three a the So now today you capacity see the from evolved from quarter, with had this number, tons. now capacity last We that X the year. Remember had lines. XXX three XXX. that with We we concept an were We the we the we have that of of lines. remember that's have Timbopeba the running in other million for additional a bar came setup

have we a be but Timbopeba XXX. capacity now, full So should to

the in we have a we forecast said for minus we we last X, So this Itabira minus already minus the a have above Itabira. would update X X already during the minus there update problem this we with put capacity of year, X, the but lack a we have here disposal the we we [Indiscernible] for the minus temporary evolve as of call Itabira, the that that Itabira. can reach X. as of still

side I want at also in bottom, to the Vargem number information right the today. So Grande. the that's the hand of that highlight capacity

whole to we have the important important to highlight. coming have Itabira capacity half, That's the will Brucutu deliver committed it's growing. first filtration Now the want adding emphasize really milestone. But We're now to I when be yet not from are of a it's sequence this here. the the the Vargem we year. second tailing an and It to production and that a startup plan plant. Grande of important for milestone we guidance plans of feature of

better firstly, to from in this support range we year way formation? million year. started Our a tons. last between much this to Well, What very QX XXX compared XXX

compared drier season the tons Eduardo to X that to second very As year north, end is year. season of the in the the better quarter, of we million rainy still due have quarter season. and is last than you first know we the Seasonally, months said, usually in even added south the rainy well rainy other this the than the and southeast But there. June Brazil the

on counting we're that improve can that we perspective. in affirm our you have and production guidance our So to

QX year was As year. last Eduardo last of lot a The one same it's last said information. the QX,

we And have follow with in information I'll you the So are the that's growing that guidance. that many to next slide. actions up another achieve also we

Our million to XXX tons. achieve roadmap the

is advancing a vibration already is testing in next test processing. must belt. Fabrica our the week, information the in First This Vargem our in wet test. we southeastern tests impact the are Grande that a We conveyor upstream with site. check

We system, And of national half. expect in for to permit bringing agents to in is the we the important III the this A&M, the expect mining in still second very keep Maravilhas the this quarter. southern to final do a This from end have Grande online as dam. Vargem we are operations, in

I can works we filtration stack also to information want southeastern capacity anticipating drag only in bring, are the This risk in have, I the plan of us the information. our allow the tailings. Itabira use We operation the have keeping site. we minus about end the And and already and missing also of want important some asset. civil this attention have to important the get. coming here in its of anticipation the system to to a are are we mentioned and to now, Itabira, X buffer, online is Good Brucutu partial up update I will Only Torto there anticipate that plant. have but trying offset to first, finish that that we permits also are An already that we construction we we try news that's the to here, to the important the all declaration asset you start it to that the dam. instability is filtration in

to But this completed have don't expect months. the final construction the year. during III, are we construction permit, process year. one But of to apply the in we middle we two to still differently this Maravilhas and all have of have this finalize from processes, both during permit intend month construction, We or

will in in pass important it's delay that startup position that to have in and filtration any I Itabira remember session. backup to next have up quarter Vargem with the for expected is have say we the questions you Q&A start Brucutu, camp of filtration Grande Luciano. to further year. If in the first I'll the here a be we of and

Good morning, good afternoon.

by saw capital Some in the quarter. were a XXX financial million. a flows strong contribution you very on cash of results. positive had Working highlights Starting as they

but surprised, than quarter of remember in strong very been in have strong spiked were this fourth and the in collected the quarter more receivable may December last You remained sales the of actually of accounts at that billion prices year reduction X.X January. end

So the increase ore was the in capital December. XXX with the also was average the to capital fourth first quarter, on that the still working why noticed you evolved price And the that? the was in employees, you shared of why working the because capital, but like move being quarter with quarter heavy payment was whereas XX% look price. other have profit the quarter working didn't at Still billed, of plats payments inventory parallel positively actually the reason XXX that iron provisional despite very moved on price If end realization may positive. the suppliers, at price for

a So the was XXX EBITDA strong back of and the the opposite. quarter quarter at the was still price sales XXX, very the what was fourth provisional quarter on there the XXX in was the The average of whereas end the first for recording price the of actually. happened provisional quarter in

fourth like opposite, pulled price the quarter even to more the compared dragged So realization quarter the the up. provisional the down prices so they which in average for

arrive were And be quarter, those once sales to this so notice and at that will ports. at something XXX today's is prices that ships re-priced they recorded

been about a one carryover and of prices same need in sequentially. EBITDA They look third up have C $XX.X cash the year. ton per the about of quarter we $XX the to EBITDA. XXX in from quarter towards purchases, So quarter million costs. to were U.S. from before sales of maybe party first could ton before per because third purchasing expect compared the last therefore, second you Talking going line party costs

and for We're higher does cents, production we're increasing XXXX, stay, on especially average. about from that of small whole slightly it prices Brazilian Riyal dollar to $XX, substantially However, system year we higher now of are high and sales Western experiencing, that the prices despite increased cents There although very can the in as see one that? from We is Also mix why competitiveness shift there from a C because the sales XX another from that around going a said year. the about call, some ton. is I impact practices. the come depreciated are costs mix the the high $X on in will very XX in our which mid we diesel last which party have cost, year doing opportunistic third costs about in like the proportion words last freight. some in has before $XX impact a by than terms and cents is last And from XX per

way second because rates the and the we spike our rates stay in this much rates spot because to freight the for in half as did spot $XX freight freight higher increase recent toward under towards, things on second half we Vale, the But more just spot average increase backdrop should of saw You ton. Vale freight if expect per actually not rates. use in about production, that $X.X freight this of they spike per ton within $XX.X in from freight

a Finally, Caledonia New in metals. on word base

Onca also will losses And you also Caledonia, EBITDA, reminder on $XX running the Puma per at didn't around about record now have million of $XX base New a Just which under operating. year the a remember not ago from quarter. you million, were metals

$XX New year compared year. $XXX quarter have per price today we conditions net last to So the per quarter generating quarter, on at million to Onca $XX out ago, around Puma as million another one million compared and Caledonia of in results improvement saving per same as a so

make to time these up. a So builds start difference things as

your Finally with have I had we What quite lot This evolving attention, do prices? to going big consistency and with no questioning. quickly. these money the of on are things are to you doubt capital higher want call a location. the is

billion. early still started wave in were towards ago prices lot a first markets diving prices the level first And of was advanced, to, of policy of Just we middle the $XXX Then were reparation wave reparation dividend ended the in and year, still prices, not paid over the to and of $X uncertainty, actually dividend in but the year consolidated. we discussion. higher once in a of from increase we then the with December suspended, started of COVID-XX, we and the half second Brumadinho November resumed agreement Brumadinho policy the last

didn't down then then the billion and of over $XXX, were at XXX month prices XXX, now it fluctuating, they're billion April $X to we kind prices create to announced the which options stabilized and But we the after higher than So agreement more buyback but once running in Brumadinho to level reached we expect. $X naturally in despite then decided peaked here allocation. are for now again this what XXX at in know a still up cash agreement. But from the $XXX situated flow in after burden finally at another February, we are prices dividend will earlier we pay

within recent So as has you in Vale story upward can and market. been the of surprises see progress the

It make prioritize We will the have buyback. minimum. same. be is in can decisions be The our be going to be shareholders. been could acceleration the We're nothing the them. of It we finish an can increase story new above will earlier. both So we buyback those what response doing, another of the in remains that could It will will to dividends consistent. we decisions There return announce be our as response? and

returning So sheet, expect we you next inefficient record of money track it the shareholders. a follow that will is lot continue balance people to should to this. The question on ask consistently start this of to that

note about leverage value Vale, the interest a of X% a for low so rates if relatively here tax on First, increase ten-year is small. bond with shield the you

$XX for rates, if to in at approximately on you're debt. payments million year debt per So tax additional going example, $XX X% you for XX billion add save billion

add of balance take should tax want order a cyclical do in if you industry a balance debt to the So billion reposition the to you in on in you billion, sheet, which obviously sheet advantage that. shields, $XX meaningful really wouldn't $XX

So against weighed tax should that these flexibility we're today they the bring be savings we making. have and that financial the in that's opportunities the the calculation future that may

However, evaluating were billion importantly, expectation to opportunity debt $XX these with around capital the leverage way. we stronger prices ton increase note I are expanded per that in also we ago the we that the of and years established and have deploy smart longer net and could for when that XX X-X target, a about if we obviously additional prices, most

So to thinking sheet about balance now now Q&A. hand the we're and let's that's how over

will you. we begin gentlemen, Hacking [Operator session. Instructions] question Alex question and answer now comes and the Citi. Thank Ladies from from first Our

some metal everyone morning I Good time. morning. I the thanks a for creating this headlines base wanted about the to for spin-off ask potential and that's Yes. guess,

in very give potential any of be it? then assets of color transaction kind would, on just What you you Thank considering be And you the us of process could transaction considering? some would you What are would behind potential what where would putting you in much. be your transaction? kind logic you sort thought there? If

really of And the we as say are here we of recovering think believe let and that foundation I I whole we the undervalued secondly, always both with story. midst What business we track. okay. on that the opportunities Well, this are be That's situation obviously, are main, Alex. Vale it's is clear Thanks behind we this on the analyzing in us and the metal on a right One pushing me driver us. twofold. to is a can how are

a clear basis to of in unlock the So it's just value multiples. way the

in now to what mean. the I what analyzing be minds where exactly conceptual So give and of said our would the phase clear you are, that does we it's

that put ore have have assets ourselves issue deal We there find with that of the First need way, iron inside. with, to are how all, a let's how with we that you we organize it to assets. that's out this we one intertwined in deal Karajas way we we as know to are,

that then Mark within, So that. and Mike, there to is that several pre-condition say might said help I the English studying do to can because on aspects how What are I can now fully, me business the the we ask in we're I analyzing. are important

Atlantic and foundations have sales since get [Indiscernible] replace narrative. and the We of productive We the before to voice The clear to copper so on need on I first are very all, operations the is and beginning. capacity mentioned cliff need to as We of foundations operating the adequately. work mine base the North VNC.

a here differently One our us to as me beforehand of analyzing Vale Mark in help narrative, mines triggers the I'll as has ask as think we us we VNC. I able the are, what and repetitive, a heading head because the But narrative about possibility. overly phase the they it, was I where sales not on But are to he's you ask It about that on business. be business the things of is Mark? that exploit. that well unleashes to unique of studying you well, be Could might think is the

optimize I said the value need for a path get like metals and spoke Eduardo two well or the to to spend Eduardo base that very out can maybe we about on think build the and foundation. the it. Alex, is make Sure I the narrative value minute strategic direction really Maybe or sure the he to optimal

our we've copper, business in We opportunities, that Salobo in we're the about of we which economy. on year years few on described the of of think Vale should per and to the more tons as projects around nickel have of for I So our key a have more us with XXX,XXX current decarbonization focusing previous a pipeline clearly participation bring in Alemão. in next III, and in where copper day Cristalino, lots copper calls

a projects current in some can infrastructure in have [Indiscernible] area Carajás Canada which the project synergies with through get that Victoria XXX,XXX us tons. business the around We project number options also up ore for the and can iron and the of other plus area, optimize to example,

So opportunities we clearly, even have the internal significant within for growth. pipeline

the time what On side, nickel the going have electric our is penetration dynamic the in talking vehicles is we about industry the industry of that the nickel path approach and lot spent a products. recently to of those the vehicle of bringing and are the down the batteries inclusion electric that and we of clearly vehicles, auto in for we

We regimes from continue have regulated and to diversity coming to credentials low we products of product ESG carbon try and vehicle that battery the the into form respected and have build and have go well intensity and electric credentials those the as such we our relate and quality Canada. the to those

in this nickel our contract the X% grow electric We vehicle in space. It we a of see produce really to is, bit buyers of an of to that products to and are further seeing really, multi-year this very to recently opportunities currently build that area nickel little we class our update a going So give sale the with what now interested an about in into right class the one who we're opportunity one just focus OEM. on in significant signed or we have represents narrative space.

in opportunities other there of our some terms have products moving We around.

opportunities have relatively talking we look a investments some maybe tease repurpose this lot a government for and with lines out. us little production and try of growth, and at interests some some We other opportunities have which smaller have to of to we out get bit to to then some more we our of

So our we're of to up to looking build into in one class going space. EV to XX% about nickel the the end XX%

narrative So metals within I would probably Eduardo, we increase how base I business. of the that the think give terms in that's value

asked several to that there process are answered. just a you questions And conclude have it's that Alex, as be

but had the in are that back phase in different We initial going in view much we with XXXX, of way. a that

a Now we have we foundation. think better

foundation. work We in the do to have still

several to hope the there have has you We I as question. I answered We of would in the have now transaction. answered that get possibility phase of how potential course and a that ask, questions your to beginning yet. be are unlock the analyzing better We're to just didn't narrative them. be

Our with of next from America. comes Instructions] question Timna [Operator Tanners Bank

and actually for afternoon very the China interesting little to in on I It's iron China. yet first cutting thanks even rise in as been get Good color. Yes. talks to the and production as release wanted prices about you out your quarter. the situation ore cut perspective your watch production point in

of we question think just the Thanks filing? bankruptcy regard on on you guys. prepare then and just year happening any second should want impact what's So what your it's to more or about for a Samarco there as see little bit a that with happening the perspective could, progresses? And if I

Go ahead Mr. China Spinelli.

two questions China for have you two main question. actually. Well, said, the thank as Timna, we points, you

is coming New considering the time properties going they all Year's on We rate started really we All trade China indicators this stimulus infrastructure and new year. have a a solid the construction lot are see from growth can demand based based ago. year, under problem some last that well. of war and manufacturing X.X starts starts, on

coming. we huge we're We as this our we long fantastic see a here something but the next demand this the the process can stimulus. we way. question we perspective, quarter, how coming stop smooth see have to to this for on have rest this. half. that In face The this don't going of process a don't half. stronger of going scenario see a So for open demand in We see second the We're a on year in the going have to

intelligence, ultra three sessions the they hand, definitely strong something the get two two well the They other want that part to seriously market of didn't that to compliant And the that of or with allow. is do the you homework, emissions, can this they the said, see, say years are We say production are that about on. country they really as process ago really with you two can ultra party the their you or years, this. are the came EU our world that coming guys rollout this if are the question see, after Cesar being We the comply just -- production follow going as be that not three should a after see we how swap time. capitalization. this [Indiscernible] really meeting, control should didn't will permit low see in three get they area. to they On really, or emissions although this? suppliers actions going emission try the at they second China if are see to two that the We to in you complied the to this The they are the their

declining, furnace again, So see, in a interest burst is utilization. can what high we the very

So this scenario to Timna for high have instance prices. is

mostly for for see a decline in can the support and can half the We whole second premiums. the premium You high year.

the be substitute price margins that of will furnace high, you If burst high. will digitization consider price, be high

pass the in will for forecast to our for for whole is Samarco. this have to I So the Luciana this scenario premiums level year.

we're going is going to Samarco as BHB be JR well, be spectators in this Vale filing. Timna, a bankruptcy the to

have the for favor, flows. is The take through injections days creditors. to operations value to process but sentences the capital available an no has more. likely in any JR. generating operate. law, This any is by to creditors done process residual also whatsoever distribution be given be file recourse we debt the started that The equity don't have company expectation And to company for Those their Samarco have of The is and the XXX will additional Samarco Vale got at company flows from to no organized expectation cash left BHB. So least there cash court. going and alternative, is at no to some in operational support will to

the at watching be to what's going we're on. stands So going

next from Mr. BMO. Gagliano [Operator Instructions] question Our comes with David

issues. on I taking down the for my bit just little questions allocation capital thanks to Hi, and questions. drill a more wanted

any associated of was the back in million the bought Vale has all, of with XXX buyback First that April? announced shares

have. we yes David,

going see monthly the to You're reports.

in to required securities file Brazil. will require the with We regulator

So available everyone. it's to going for be

that to of results, we in issued days XX these of not the regulation. therefore, shares prior buyback period And because However, we by any notice were issue results just had the able blackout the yesterday. to

obviously And going obviously, mentioned that here. forward lot then cash still are you CapEx, total just a dividends, after of regular payments

the be over terms these should above what so, cadence we expect should of how more perspective we a something in expecting timing regular Is we in dividend of a for terms payment? question before expect regular from shareholder example, next this and form returns detail in the dividends? a little incremental and should from And the say

in regular said you discussed haven't as just September. so occurred that payments the We and March

in So interim. cash board acceleration is the return not buyback could upcoming to should allocate between to discussed the which way through be an but this elected do more shareholders something obvious if will of the or with be we

keyword want gauge the that March. are over to think market to wonder on course the always we stuck in sometimes add like sometimes September, David need here we last but dates, be to that year I is don't consistency. to in March overly We of just optimistic, the Luciano, pessimistic

in between willing the to it. do normally about we it talk of mentioned, So that we minimum we you but expect Luciano would buyback the as had payments. clear to was do we And dividends board. about have to But should course to because be did consistently,

Carlos comes Alba Our Mr. next Stanley. question De Morgan from with

But Luciano guess can from [Indiscernible] through payments that same Good other you into a Are look Thank on in cap the dividends strong any if growth like? are you is expectations maybe you quarters? there on dividends projects company or defined increase higher. dividends I of interest generates metals. books Muati's was I much. mentioned limits very of than mean, of us growth expect the regular It of the shareholders? to as the and are back amount and also I propose that second what my the flows. coming CapEx the that we I consider the probably Eduardo, or can the if How we guess that we, afternoon. divestiture formula potential or would there walk that to the may, the look that surprisingly dividends and any, timing cash very or steps how to would process. would incorporation topic lot prices by should caps especially there is a pay? you clearly I any process to process are company the limit terms your question the for are And to can a Vale's the have amount paying on company of company quarter on of the guess next will you your at Thank base regard in clearly you. Luciano, debt board or

Luciano, one. just the get me let first

so you growth question as a is I debt I There there's take no and very need transformation course, well well. CapEx of again behaved, shouldn't think CapEx in balance structure, I so is clear all a no pointed there's think capital nothing radar it a like is you of that don't, structure that. to or pretty market out again M&A then the there expect lot in as makes, our make conditions, always around extreme platforms cap. radar we and correctly, so assess opportunity secondly, our to And people will you is

shareholders, said going Luciano? to the So Luciano and with is just beginning, that the I'm right in to Luciano the paraphrasing go mentioned return

quick. we of order XX the up. XX Yes. in already be to million By tons. On which million we'll be hope by started producing the should the Muati’s, it receive finalized ramp so hope We revamp We half tons. will at end upgrade to equipment production to year, site on second beginning the the the just we of

today's and finance of If project the maybe turn a burden positive be following the without prices The prices the your project question. The and that year soon mat through EBITDA thermal beginning burden that results coal flow can Vale's you finance coal coal. of XXX, positive goes financial quite cash the to that XXX. and maybe at next of the of consider was little than business always within felt higher

the to be, so finance. the it coal tariff the for pays because order needs mine punitive is in corridor a which project because penalized today to So EBITDA is repay

EBITDA other coal when year just coal million, million statements, million So everything be be for debt finance order they less a why is what's that for part those much But going will in through therefore that the XXX purchase a about will to same as the become that consolidated need negative to Vale's finance of and is immediately a you you don't example, will watch as interest service XXX funded the is million of the positive. by of that I'm the EBITDA project and or XXX Mitsui, happen the it just going XXX coal XXX project million it tariff. so you amount seen repayment. improve financial on at EBITDA hand the as business part and to and debt saying Once turn

just and today. is better slightly to seeing you're produce need price You than what

at do what refinance to the money bears be do. obviously to corporate and which will Mozambican us going lower Vale given rates that much I leads have interest there's next and to project finance stage, that. rates with opportunity which that the save we're That's and higher So risk a

a timing bid. there XX wanting signed terms beginning to the going lot we're go to with a and NDAs succeed, that by over to is parties. to way target sign asset look at Obviously interested firm We a have those before to are end. people start year for In Obviously, a have we of the second divestiture, hope people be offering half. already intention to between on of to deal that diligence the hopefully of would do and try the if going again intentions we

is and have is thermal waiting Obviously in thermal weight COVID-XX China some Australia between met of is on on situation prices. international and big variables dispute put coal all prices, on risk now the good which there a Some coal which India, coal importer this you that. also

if deal by we see believe I lucky, So let's can of the we're the end year. still a sign little a

Scotiabank. next Our from comes Alfonso Salazar question with Mr.

can the if morning and the market coming to guidance you pellet regarding and some ask year and give want you us everyone. the of good Thank the the some update on you for color about a of provide that? for and if rest the can I in years production outlook

It's market, about Spinelli Well the your let's question. talk demand Thank here. pallet side. for you

The as reduction the You burst split furnace pallet direct this in burst is furnace pellet quite pallet. and ore. same iron

you Very improve to It's to that's going China China. good see furnaces really to in We two the but same of problem well. the are there assisted improve market. in necessity prices not prices, and production. ex-China the use burst pattern our is related the the of margins

limitation, So for and the and can is a key you is from today. limitation side in The today producer other see supply perspective, is a this and sales room key, the premiums. hand a a the there Vale opportunity

before. the slightly feed the is We limitation production year pellet The production. the expect this than better year

restrictions our tailings of temporary have the main sites. to We in dispose

So Brucutu, Itabira.

million but to targeting be are not to So but define the perspective tons to that. expect this XX more I'm back XX we saying for next that ready capacity demand on than we tons, produce It want do year, the don't year. million market that. to perspective, we to go the to depends

market premiums we see tight. supply current some a really conclusion, quarter, have that first compared tight, premiums, in the premiums expect the you increase premiums. in quarter is the demand in we So room to risk there And we This last last as a doubled is again is quarter another have another the the the the as we demand for year.

market. the mentioned for that update about the quite same element direct Just prediction I burst furnace. That's an

market and are the the direct And Midwest in they now have all improve of that high of and improve higher scraps definitely coming is Turkey really margins, price the because a scrapping again this U.S., lot this increase margins market. in really our the more to can good to of make clients, charge use improve room and of We USA there is main the have the fast production, the economy their coming, scrap, use the reduction. two but that their ingredients our pellets to they they produce, they stimulus here. is need of price premiums

supply in this can we limited the strong see that the year, because and place. is of So premiums outlook demand for good the is

next Générale. from Société with Georges Our question Christian comes

indeed. very you. much Brazil, in I with had assistants you and for two is your Thank very questions well medical done good it

large near area them of and One for an Does some also a higher some some outlook? long and of distance? term scenario seem said in exclude because cash very on the in you investment small no in customers your availability at this something is, term scenario? M&A where steel putting greens capital statement transformative to flow. is even So in copper on would positive is I'm an that or question large that prices And of context from part you longer sector? make on be you just the your M&A, that on consider you Can in cash the a which a you to just in to hydrogen that consider trying is move of you're second And side cash the decarbonize. be looking of nickel.

You're out of Caledonia. New

at situation just Canada down market? is something What able Brazil? still you're you're there in something the was from it you. it with seriously battery moving the nickel at on Indonesia. to being doing Thank serve and or to and You're Is the looking to sulfate there, out looking

you're right Hey Christian Yes, there's much. M&A. thank for announcement medical assistance. of first all no the very the you of transformative Thanks

might always looking we It's understand but for we very are stop. hard you shouldn't could, as copper. We

one it's obviously of area interest. So

very interest all clean. substitute bold clean is and for energy our area have we Another a energy, eliminate goal our have of of to eliminate matrix not

to small three heart that did following of because say doing that way are targets our the I very and specifically that So up some watching more one it on can we that are by players some necessary that the to that think seat. us the that how subject on but brings might happen announced, few I the to environment dear have acquisition and we scope just is very hydrogen another

hydrogen But be help be are we're to believe industry. Mark to We closely And looking iron that get quality goal, if He to the far, what we go that capture, will I high but and inadequate there our best high will our no best answer. very customers. watching clients to with actually better working time are for it's I I that constraints think we to for It's hydrogen but theses more is with ore is needed objective. quality and close nickel wouldn't metallics think okay. happening of and because think we alternatives the on short investments carbon but more steel hydrogen

Sure. nickel. Sumatomo area focus But of of that the is that which being product class right. Christian, with is in the be would a [Indiscernible] metals that clearly -- in Canadian would sulfate terms that project the prominent clear you're market. discussed would being the are of primary The and sorry most the go there Indonesia opportunities be studied sulfate into

front us. So that of right one's in

really there at aspirational are ones are point would time. in that or of other I significance nothing but opportunities early, say The

that that are point in for call [Indiscernible] the there and but significant by are our in books parties example, example, at projects time. are this nothing there's are others interested there Indonesia on For in

next comes UBS. from Our Mr. question Bokkenheuser with Andreas

get to get Australian volume reach freight the on these had time either then hope government the over kind formality? a of are of your one on any materializes clarity that kind you question state visibility peers this? parts question. question. Vale you have in as of first of and things out a there is focus capacity thinking a to be conversations for it on A two about of That's well. there Thank as or the taking particular, a I'm number XXX in million at is not within to kind the obviously always could kind ore sitting obviously of you my value and XXX part system you little give talked federal are is has and of ton all would with basically first the your going has Vale's capacity them additional time comfort with volume of be on Well You at delayed question if expect are tons that and of XXX. beyond almost volumes the a this there that point much We're very required but would and now capacity I The two of kind the be million production line. was they XXX monetize but goal tons. tons I XXX of add iron Is iron us ore licenses? that obviously or to mean it I and think additional there can can million down and northern consolidated merely additional any a significantly that you bit questions. it But safe already. volume question you're about kind licenses your

kind impacts question longer view prices bit about XXXX, we half $XX is have capacity a volume So P&L the half So well long going your Vale the then beyond that still sitting you contract? could going how given to and slightly ton high of are additional is could XXXX, next about second into more keep inflation into think freight market on end not just a by protected of we that the of first, you term of the question it that freight. talked that's obviously how are look through volume like if trade where on a the or cost. the strategy additional freight second flows freight sorry at year if your do inflation your How and of still putting of systems you Luciano, second forward? Vale's there that and you the over that kind freight that's So volume year, value rates given is if be we're look obviously does year. throughout the

So those are my two questions.

little long. if were a they Sorry bit

speaking. a Spinelli you problem, Thank for No Andreas. question.

the with always we delay our achieve extra plan some the authorizations Regarding try to keep our obviously in and track risk are then licensees okay. to or volumes, to planning

bridge what in keep you just you north in the In split of the really the the rolling We going lack to we it's we filtration. It's need delay. license don't install three, gap the so process. don't a well. of system close capacity the are southeastern dam's Pete to we challenges of the capacity, license We if see [Indiscernible] see, So got as to usual. business as the any

So it's in our hands actually.

final deal have I'm have have you to any do don't and we have Torto that a the have this licenses still see I but we but yes if We big delay full we explained about back in Vale we dam buffers contingencies your we in our day. be that. of the that question, is to the for emphasizing position part end process second to to your planning bring of trying reliable mantra. are Jumping a

market million ready This tons. So back target building tons are is million XX extra -- want use we okay our are be and XXX and to with that. bring tons. can to an want we million the reliable with the to Why? if demands be XXX million tons extra we We the million of XXX XX we

our we mantra. that's in So We're decide evolve these to as going the market.

for we can to again you that and said of side ready that don't, need exposure maxes quarter, to XXX next the freight again, we capacity more this this our for second additional but the and the freight year see match less that So exposure about extra finalize definitely we seasonally demand freight, first will [Indiscernible] an half be half for are the an New million bringing Luciano for fleet. we but but as its the XX the are this spot in six have mind Castle must tons

XXX We our are vessels talking in about today. fleet

freight hedge that that to was happen the and market So market. the Panamax consider and came contaminated for vessels definitely today small spot the really these we seasons is problem related inflation we this the make the are just growing natural to last vessels and soybean

We're another scrubbers. have today That's business being not so any our us fleet inflation have stable. market is to And that important and point we we total the the are need are the fleet any to and affected for not between to market. this. these own point high very to low again working shipping be hard installed for gap to So all additional -- we in live we offset an problem the spot forecasting big the is

all. Said it

This question-and-answer may statements. closing Eduardo Mr. session. with this you today's your time, concludes at proceed

attention Thank I very need you. the to talk for rest much questions. your us. and Thank you to

I play we're one. in think from we've It's that a going marathon day been a repetitive through.

production. is are lot Vale one. The strides more the with Still to on in think well. is discipline achieve. And we rewriting. be it that the assertive be the of said risking reshaping risking, good, is good safety do goals I going But a to day communities. and pretty my ratings mark. of we that. our how to on doubt going on advancing capital did Example, be tremendous we zero another to respect watch final we Reshaping to with going example very Mozambique's

So we're a human to going and more that be more be reliable and more will priced organization safe, correctly.

the hope lot thanks us right for to So questions that lot. next the a because call. see a Thanks in to your direction moves and you

Vale's for today. does very you participation. Thank That much for call conclude conference

line. disconnect You your may now