Vale To Announce 70% Increase In Q313 Net Income

News: Brazilian mining company Vale is expected to post a 70% y-o-y increase in its Q313 net income following higher-than-expected commodity prices and a fall in its production costs, Mineweb reports. The increase, which would put the company's total net income up to BRL6.3bn (US$2.8bn) for the quarter, is expected to be the company's first quarterly profit increase since Q211. The company is thought to have cut its costs by around BRL3.7bn (US$1.65bn) during H113.

BMI View: Brazil's mining sector will experience continued, though slower, growth as weaker foreign demand for iron ore and other base metals weighs on Brazilian exports. The country's large untapped reserves and relatively small mining sector relative to regional peers should ensure continued investment. Iron ore production will continue to be the main driver of mining sector investment, but we expect growth in several base metals, as well as gold, providing opportunities for mining companies and investors. Still, falling demand from China and still weak developed world growth will lead to muted growth over the next several years compared to the heady expansion of the past decade.

This article is tagged to:
Sector: Mining
Geography: Brazil

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