MINING CORPORATIONS – BRAZIL

Vale challenges Rio and BHP on China sales

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Original article by Peter Ker
The Australian Financial Review – Page: 25 : 1-Mar-18

Brazilian iron ore miner Vale has indicated that since 2016 its profits margins on sales to China have matched those of BHP Billiton and Rio Tinto. Vale has increased the average iron content of its ore to 64.3 per cent, and a spokesman says this should rise further over the next several years. In contrast, BHP’s ore has an average iron content of 61 per cent, while Rio Tinto’s averages 62 per cent. Meanwhile, BlackRock fund manager Evy Hambro says expectations that the price discount for lower-grade iron ore will be sustained prompted the World Mining Trust to divest its stake in Fortescue Metals Group in 2017.

CORPORATES
VALE SA, BHP BILLITON LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, FORTESCUE METALS GROUP LIMITED – ASX FMG, BLACKROCK INCORPORATED, BLACKROCK WORLD MINING TRUST PLC

Rio Tinto digs in as Vale raises iron ore grades

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Original article by Peter Ker
The Australian Financial Review – Page: 15 : 19-Feb-18

Brazilian iron ore miner Vale has advised that the average iron grade of its ore rose to 64.3 per cent in the December 2017 quarter. Vale has been progressively increasing the quality of its iron ore, due to factors such as increased output at its higher-grade mines and a corresponding fall in production at mines that yield lower-grade ore. Although Vale has indicated that it aims to further lift the average grade of its iron ore, Rio Tinto has ruled out similar action at its Australian iron ore mines.

CORPORATES
VALE SA, RIO TINTO LIMITED – ASX RIO, BHP BILLITON LIMITED – ASX BHP, FORTESCUE METALS GROUP LIMITED – ASX FMG, CITIC LIMITED, ANSHAN IRON AND STEEL COMPANY

Fortescue shares sink as Vale deal stalls

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Original article by James Thomson
The Australian Financial Review – Page: 21 : 15-Sep-16

Vale’s Peter Poppinga says a proposed iron ore blending joint venture with Fortescue Metals Group is unlikely to be finalised before the end of 2016. He says negotiations between the two groups are taking longer than anticipated, with the pricing of their iron ore products believed to be a key issue. Fortescue CEO Nev Power has been more upbeat, suggesting in July that the deal could be finalised in the near-term. Fortescue shares have gained 153 per cent so far in 2016.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG, VALE SA, BLOOMBERG LP

Vale vows not to flood the iron markets

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Original article by Peter Ker
The Australian Financial Review – Page: 13 & 18 : 8-Aug-16

The annual capacity of Vale’s "S11D" iron ore project will be 90 million tonnes, which has prompted some analysts to forecast an iron ore oversupply in 2017. However, Vale’s Peter Poppinga has downplayed concerns about an oversupply, arguing that the Brazilian group will ramp up exports over several years, with its mine capacity to increase at a faster pace than its rail capacity. He also stresses that not all of the increased production will be exported to Asia.

CORPORATES
VALE SA, UBS HOLDINGS PTY LTD, BHP BILLITON LIMITED – ASX BHP, FORTESCUE METALS GROUP LIMITED – ASX FMG, ROY HILL HOLDINGS PTY LTD, ATLAS IRON LIMITED – ASX AGO, MINERAL RESOURCES LIMITED – ASX MIN, WORLEYPARSONS LIMITED – ASX WOR

Chinese deal with Vale can cut BHP both ways

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Original article by John Kehoe
The Australian Financial Review – Page: 20 : 23-Jun-16

A Bloomberg report has suggested that Vale could seek to raise up to $US7bn by selling a minority stake in its iron ore assets to Asian investors, most likely from China. On one hand, BHP Billiton would welcome such a deal, as its Samarco iron ore joint venture with Vale must renegotiate US3.8bn worth of debt, while Vale’s own debt pile totals $US23bn. On the other hand, Vale’s strategic investor may have a vested interest in trying to push the iron ore price down, particularly if they are also a buyer of iron ore.

CORPORATES
VALE SA, BHP BILLITON LIMITED – ASX BHP, SAMARCO MINERACAO SA, BLOOMBERG LP, RIO TINTO LIMITED – ASX RIO, ALUMINIUM CORPORATION OF CHINA LIMITED

Fortescue unperturbed by reports of Vale talks

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Original article by Tess Ingram
The Australian Financial Review – Page: 15 : 21-Jun-16

A Bloomberg report has suggested that Brazil’s Vale may sell a stake in its iron ore assets to Asian investors for up to $US7bn. Australian-listed Fortescue Metals Group has downplayed the likely impact of such a deal on its proposed iron ore blending joint venture with Vale. A Fortescue spokesman has reiterated that the group hopes to commence marketing the blended product to Chinese customers in the second half of 2016.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG, VALE SA, BELL POTTER SECURITIES LIMITED

BHP dives on fears over Brazil lawsuit

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Original article by Peter Ker
The Australian Financial Review – Page: 25 : 5-May-16

A Brazilian prosecutor intends to launch a 155 billion Brazilian Real ($US43bn) damages claim against BHP Billiton and Vale over the tailings dam disaster at the Samarco iron ore project. BHP had previously advised that the Samarco joint venture partners’ total liability was expected to be 9.2 billion Brazilian Real ($US2.58bn), after reaching a preliminary agreement with the Brazilian Government. BHP shares closed 9.4 per cent lower at $A18.79 on 4 May 2016, amid a broader sell-down of resources stocks.

CORPORATES
BHP BILLITON LIMITED – ASX BHP, VALE SA, SAMARCO MINERACAO SA, RIO TINTO LIMITED – ASX RIO, FORTESCUE METALS GROUP LIMITED – ASX FMG, OZ MINERALS LIMITED – ASX OZL, NEWCREST MINING LIMITED – ASX NCM, WHITEHAVEN COAL LIMITED – ASX WHC, S2 RESOURCES LIMITED – ASX S2R

Fortescue’s Vale deal good for costs, but concerns remain

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Original article by Amanda Saunders, James Thomson
The Australian Financial Review – Page: 19 & 24 : 10-Mar-16

Iron ore miner Fortescue Metals Group aims to reduce its cash costs to $US13 per tonne by mid-2016, having slashed its cost of production from about $US32/tonne to around $US16 in the last year. The proposed iron ore blending joint venture with Brazilian rival Vale may allow Fortescue to further reduce its cash costs. Paul Young of Deutsche Bank notes that Chinese competition regulators may oppose the alliance, although Fortescue CEO Nev Power is confident that this will not be an issue.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG, VALE SA, DEUTSCHE BANK AG, CLSA AUSTRALIA PTY LTD, UBS HOLDINGS PTY LTD, JEFFERIES AND COMPANY, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, ATLAS IRON LIMITED – ASX AGO, BC IRON LIMITED – ASX BCI

ACCC on alert as Fortescue, Vale get cosy

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Original article by Matt Chambers, Paul Garvey
The Australian – Page: 19 & 27 : 9-Mar-16

The Australian Competition & Consumer Commission is among the regulators that are likely to scrutinise a proposed deal between Fortescue Metals Group and Vale. The Brazilian group would acquire 5-15 per cent of Fortescue’s shares on-market, while the two groups would establish a blending joint venture to export $US4bn worth of iron ore to China. Christopher LaFemina of Jefferies does not see much advantage for Vale from the deal unless the long-term plan is for it to acquire Fortescue.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG, VALE SA, JEFFERIES AND COMPANY, BHP BILLITON LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, CITIGROUP PTY LTD, WESTERN AUSTRALIA. DEPT OF THE PREMIER AND CABINET

BHP surges on dam compo deal

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Original article by Barry FitzGerald
The Australian – Page: 19 & 20 : 4-Mar-16

Shares in BHP Billiton closed 3.1 per cent higher at $A17.25 on 3 March 2016. The stock rallied after its Samarco iron ore joint venture secured an agreement with the Brazilian Government and two state governments regarding compensation and remediation work following the November 2015 tailings dam disaster. The deal could potentially allow the Samarco joint venture with Vale to resume production in 2017.

CORPORATES
BHP BILLITON LIMITED – ASX BHP, VALE SA, SAMARCO MINERACAO SA, SHAW AND PARTNERS LIMITED