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Vale looks to leave nickel setbacks behind with growth plans

Friday, September 9th, 2022

Vale raised its nickel output guidance as one of the top miners of the battery metal looks past recent operational setbacks to projects aimed at tapping growing demand.

The Rio de Janeiro-based company expects nickel production to reach 230 000 to 245 000 metric tons a year in the mid term, according to slides released as part of an analyst and investor tour in Canada. That’s up from a forecast in May of 200 000 t to 220 000 t, with the difference coming from additional growth through Indonesian ventures.

Predominantly an iron-ore supplier, Vale is using the tour to showcase its Canada-based nickel and copper business in the context of looming global shortfalls of both metals due to their use in electric vehicles and renewable energy.

While that side of the business has been beset by operational glitches and guidance cuts in recent years, Vale says it’s now well positioned to benefit from surging demand and evolving regional supply chains in the move away from fossil fuels. The Brazilian firm has been looking into options for the base-metals operations, such as a spin-off or a merger to unlock billions of dollars in value.

Long term, Vale expects to reach annual nickel production of more than 300 000 t. That includes indirect exposure to nickel sourced from its Indonesian venture for processing projects. Vale’s copper output is set to triple from current levels to about 900 000 t long-term, it said. 

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