Vale (NYSE: VALE), the world’s top producer of nickel and iron ore, has received non-binding offers for its operations on the Pacific island of New Caledonia, it said in a conference call on Wednesday.
The Brazilian mining giant said it expected to have “relevant news” on the topic within a month or two.
Vale put its New Caledonia nickel assets on the block in December. The decision came after it had to write down $1.6 billion in the fourth quarter related to the ailing mines, the world’s biggest nickel operations.
That announcement came less than a year after it had unveiled plans to invest $500 million in the nickel mine after failing to find a partner for the operation.
Last week Vale axed its 2020 production forecast for the metal to 180,000 to 195,000 tonnes from 200,000 to 210,000 tonnes, excluding its unit in New Caledonia.
Delivering first quarter results, the miner said its near-term view for nickel has changed as a result of the covid-19 pandemic.
Vale believes the nickel market will enter a surplus in 2020, compared with its previous view of continued deficits, but said its long-term outlook remained positive due to factors including demand for nickel in the batteries that power electric vehicles (EVs).
“Vale’s cut to production has supported the [nickel] market, but mines closing production is not too new as we knew some mines would shut,” Commerzbank analyst, Daniel Briesemann, said in a note last week. “The negative impact of the virus is more severe for the demand side, and the market could be well oversupplied this year.”
More to come…
from MINING.COM https://ift.tt/3cZg3ba
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