Vale S.A. (VALE) is a Brazilian multinational diversified metals and mining company. It’s the world’s largest producer of iron ore and iron ore pellets. It’s the world’s second largest nickel producer. It also produces manganese ore, ferroalloys, coal, copper, PGMs (platinum group metals), gold, silver, cobalt, potash, phosphates, and other fertilizer nutrients.
Vale has mineral exploration operations in 11 countries around the globe. It operates infrastructure systems in Brazil and other regions of the world. Its infrastructure systems include railroads, maritime terminals, and ports that are integrated with its mining operations.
Vale’s operations are divided into the following four main lines of business:
- bulk materials – iron ore, iron ore pellets, manganese, ferroalloys, and coal
- base metals – nickel, cobalt, copper, PGMs, and other precious metals
- fertilizer nutrients – potash, phosphate, and nitrogen fertilizers
- logistics infrastructure – railroads, maritime terminals, distribution centers, and ports
The bulk of Vale’s earnings comes from iron ore.
Other companies in seaborne iron ore trade include Rio Tinto (RIO), BHP Billiton (BHP), Fortescue Metals Group (FSUGY), and Cliffs Natural Resources’ (CLF) Australian division. Together with Vale, these companies account for more than 70% of the seaborne iron ore supply.
Investors can also consider investing in ETFs such as the SPDR S&P Metals and Mining ETF (XME) that invest in the metals and mining sector. All listings of BHP, RIO, and VALE form 31.6% of the iShares MSCI Global Metals & Mining Producers ETF (PICK). CLF forms 2.9% of the SPDR S&P Metals and Mining ETF (XME).