Friday, February 26th 2016 - 11:02 UTC

Brazil's Vale reports record losses; puts prime assets on sale to lower debt

Brazilian miner Vale SA put its prime assets on the block on Thursday after taking the biggest loss in decades, but analysts said the target to make $10 billion in 18 months was unrealistic and expressed concern a fire sale could destroy equity value.

CEO Murilo Ferreira said there were “no restrictions” on what the company would consider selling in order to reduce net debt to $15 billion

 Chief Executive Murilo Ferreira said on a conference call there were “no restrictions” on what the company would consider selling in order to reduce net debt to $15 billion as it looks to protect itself against a possible further deterioration in iron ore and nickel prices.

The move is a sharp departure for the troubled miner and is a reflection of how vulnerable the world's largest iron ore producer has become to volatile commodity prices.

Vale reported a fourth-quarter net loss Thursday of $8.57 billion, its worst ever as a private company, amid weak commodity prices and hefty write-downs. Vale together with Petrobras are the largest companies in Brazil and not so long were considered the jewels of the crown.

Previously, Vale had looked to make up cash shortfalls by selling its so-called “non-core” assets like fertilizer plants and ships, confident that lucrative profits will return when its new S11D iron ore mine in the Amazon hits full capacity in 2018.

Now, with analysts forecasting that iron ore may stay around $45 per ton until then, that date looks a long way off.

“I can understand Vale's strategy because if iron ore slips to $35 per ton, all of a sudden you have an issue,” said Andreas Bokkenheuser, analyst at UBS. “But the question is what valuations can they get for these assets?” adding that Vale had to be careful not to sacrifice future cash potential.

The company did not say how much it was looking to get for certain assets, or how close it was to doing a sale.

Market experts have criticized the strategy of the so-called “big three” iron ore miners of Rio Tinto, BHP Billiton and Vale to keep increasing production despite an oversupplied market and falling prices.

Of the three, Vale has been worst hit because it was at a later stage of its investment cycle, building major mines in Brazil and Mozambique, when prices began to slide, forcing it to spend more cash while earning less.

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1 L0B0MAU (#) Feb 27th, 2016 - 10:09 am Report abuse
Has Vale - and the other government-owned organizations - ever reported record profits more frequently than the record losses?

If not; sell them off - ASAP!
2 Brasileiro (#) Feb 27th, 2016 - 12:09 pm Report abuse
This is my country! This is my culture! That's my people! This is my love! This is my life!
3 L0B0MAU (#) Feb 27th, 2016 - 01:17 pm Report abuse
Hi, Brasileiro!

Nice propaganda of Embraer! Your culture and people ARE superb!

The big problem is the governments which they elect! They - the govts. - are making sure that Brazil remains FOREVER as an Underdeveloped [emerging, if you prefer a different word] Nation.
4 Brasileiro (#) Feb 27th, 2016 - 01:36 pm Report abuse
Why do you think that?
5 L0B0MAU (#) Feb 27th, 2016 - 02:42 pm Report abuse
Hi, Brasileiro! Instead of progressing; the country is nosediving into a BIG mess. Only a miracle can save the country within the next 3-4 years!
6 Brasileiro (#) Feb 27th, 2016 - 03:07 pm Report abuse
Save the country is to do things like the West?

Save the country is to return it to the colony condition?

Save the country is to leave the volatile and speculative capital from the West to dominate our land?

If so I hope you guys never think to save us!

7 L0B0MAU (#) Feb 27th, 2016 - 04:06 pm Report abuse
Save Brazil from the Corrupt Brazilian Politicians!

Proof of the pudding:

Not yet satisfied? Want more proof
8 Brasileiro (#) Feb 27th, 2016 - 04:10 pm Report abuse
And if I say that you're being deceived?
9 L0B0MAU (#) Feb 27th, 2016 - 04:17 pm Report abuse
Pl. prove that the Brazilian Politicians are not at all corrupt: “Brazil's Vale reports record losses; puts prime assets on sale to lower debt”:
10 Brasileiro (#) Feb 27th, 2016 - 04:28 pm Report abuse
Vale do Rio Doce is a company that was privatized in government PSDB.

At that time (1997) the market value was 100 billion dollars, but Vale was sold for $ 7 billion.

Only in this life the PSDB (in 1997) stole from Brazil 93 billion. And I'm not citing the $ 4 trillion in iron, manganese 560 billion, 540 billion in uranium 440 billion in bauxite and finally 50 trillion in NIOBIUM!

Nationalism is to protect, love and not harm others!
11 L0B0MAU (#) Feb 27th, 2016 - 05:25 pm Report abuse
You are absolutely right about: “Nationalism is to Protect, Love & NOT Harm”.

Now the only thing the Brazilians have to do, is to convince their politicians to follow the same nationalism.

12 Tik Tok (#) Feb 27th, 2016 - 10:31 pm Report abuse
Stop being an imbecil Brasshole, your socialist mates are a disgrace
13 Skip (#) Feb 27th, 2016 - 11:09 pm Report abuse
“Save the country is to do things like the West?”

Why do people from developing countries ALWAYS assume this means doing things like the USA?

There are dozens of countries that make up the WEST. There is not one monolithic WESTERN political or economic system.

So yes, do things like the WEST.... perhaps emulate Singapore or New Zealand or Ireland or Finland or Germany or Luxembourg or Belgium or Poland or Austria or Canada or Switzerland or Australia.

The simply fact is that WEST has developed more and is richer and more stable than any developing country. So why do people think that emulating some parts of the WEST will always be bad?

The WEST is not just Europe and not just North America. It can adapt to anywhere. It's why places like Japan and South Korea, even though they were never colonised are now considered WEST.

Who should Brazil emulate Brasileiro? If you think it is other BRICS, then look long and hard at what they have and do. Because this freedom of opinion that you are so proud to have..... doesn't exist in China. This national ownership of resources that you enjoy..... doesn't exist in Russia. This welfare system and middle class you aspire to...... doesn't exist in India.

They all exist in different parts of the WEST. Sometimes together in the one country.
14 L0B0MAU (#) Feb 27th, 2016 - 11:16 pm Report abuse
Hi, Brasileiro!

So you can't prove that the Brazilian Politicians are not at all corrupt?

I thought so! FYI:
15 Jack Bauer (#) Feb 27th, 2016 - 11:45 pm Report abuse
@14 LoBoMAU
Your kind gesture in trying to educate the BRasshole is very noble, but as you have do doubt realized, he is not too clever when it comes down to numbers.....he gets lost in the zeros, specially if there is more than one of them.
While it seems that he might even be well-intentioned, it is sad to see his gross ignorance and the way he fights for everything that is rotten in this government.
16 Brasileiro (#) Feb 28th, 2016 - 11:38 am Report abuse
@14 The political corruption scheme in Brazil seems to be widespread among the entire political class, with rare exceptions.

But the most worrying, in my understanding, is corruption practiced by Judge Sergio Moro and by prosecutors in Paraná. They persecute any citizen who has links with the PT and turns a blind eye to the rampant corruption of the PSDB that comes up.

The Brazilian people must unite to punish Sergio Moro and away the PSDB of the presidency of the republic for the next 100 years.
17 L0B0MAU (#) Feb 28th, 2016 - 02:35 pm Report abuse
ATTN: Brasileiro:
- In any case, you have NO proof of innocence of these corrupt politicians!
- Do you mean that Sergio Moro has NO concrete proofs?
Pl. check what PT is doing to Brazil after being the ruling party for about 12 years:
Another curious observation is that The Economic Crisis suddenly appeared - very conveniently - just after the recent elections! What a coincidence!
18 Brasileiro (#) Feb 28th, 2016 - 02:56 pm Report abuse
Father's Judge is founder of the PSDB here in Paraná.

The only evidence of the judge against Lula, Dilma or most of the PT are the articles published by the mainstream media (See Magazine, Estado, Globo). There is no evidence, only inferences.

Our state is dominated by the judicial dictatorship!
19 L0B0MAU (#) Feb 28th, 2016 - 03:06 pm Report abuse
Got it! All the corrupt politicians are actually innocent!
20 Brasileiro (#) Feb 28th, 2016 - 03:17 pm Report abuse
Many of them are innocent. Most are not.

See above...

I do not want to protect the PT, but I want to make clear that the PT is chicken thief and the PSDB is Bank Robber
21 L0B0MAU (#) Feb 28th, 2016 - 03:24 pm Report abuse
Luckily; all the crooks in Brazil are not politicians!
22 Brasileiro (#) Feb 28th, 2016 - 03:29 pm Report abuse
I did not understand What you meant.
23 L0B0MAU (#) Feb 28th, 2016 - 03:31 pm Report abuse
The Good News is that, not ALL the crooks in Brazil are politicians! Isn't it?
24 Brasileiro (#) Feb 28th, 2016 - 03:47 pm Report abuse
I do not think this is good news. Brazil needs more honesty and nationalism, but these problems can not be solved in a single generation. In 2000 56% of children and young people were out of school. The government PSDB never cared about the poor, health or education of our children.


The State Government of São Paulo, which is the PSDB, stole school meals for their children.

As a party of those want to rule the country?

Meu Deus!
25 L0B0MAU (#) Feb 28th, 2016 - 04:02 pm Report abuse
So according to you; the Good News is that, ALL the crooks in Brazil are politicians? Quite possible!
26 Brasileiro (#) Feb 28th, 2016 - 04:13 pm Report abuse
According to me Brazil is a wonderful country, with wonderful people, with stunning landscapes, with rivers full of fish, with pure water, with beautiful music, with an unforgettable food.

And women.......delicious!
27 L0B0MAU (#) Feb 28th, 2016 - 04:23 pm Report abuse
We agree at last! :D
28 Brasileiro (#) Feb 28th, 2016 - 04:28 pm Report abuse
Thank you, brother!
29 Jack Bauer (#) Feb 28th, 2016 - 10:17 pm Report abuse
While I must agree that Brazil is a beautiful country, when it comes down to nature - plenty of land, forests, rivers (nice when not contaminated with iron-ore), good climate , lovely beaches - but the 'zé-povinho' that inhabits it, is what screws it... Brazil could be a million times better than it is.....for the fact that it is not, we have the PT and the likes you, imbecile, to thank.
And Brasshole, no need to lie....we all know you aren't “muito chegado em mulher”....we know you really like to donate your “fiofó arrombado”' to Lula.
30 L0B0MAU (#) Feb 29th, 2016 - 10:56 am Report abuse
“Crise no Brasil” - Various aspects explained from different points of views by a few experts:

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