Vale’s (NYSE: VALE) Canada operations led its second-quarter performance with a 44% rise in nickel output at Voisey’s Bay in Labrador and higher output at its Sudbury operations.
Nickel sales drove base metals revenues to $1 billion, a 15% rise, as copper revenues climbed 23% to $958 million.
“We delivered another strong quarter, reflecting our focus on operational excellence and disciplined execution, keeping us on track to meet our 2025 guidance,” CEO Gustavo Pimenta said on a Friday conference call with financial analysts.
The executive attributed the strong performance at Voisey’s Bay to Shaun Usmar, who has been the CEO of Vale Base Metals for a year and was previously with Triple Flag Precious Metals (TSX, NYSE: TFPM). Usmar also led an asset review initiative in Vale’s Base Metals unit.
Nickel output rose 44% year on year to 40,000 tonnes, driven by productivity initiatives and the successful ramp-up of the $3 billion Voisey’s Bay underground mine in northern Newfoundland and Labrador. Unit cost of sales at Voisey’s Bay and the Long Harbour plant fell 57% to $13,236 per tonne.
Lower cost
The Sudbury nickel unit’s cost dipped 31% to $10,511 per tonne as higher volumes and reduced planned refinery maintenance diluted fixed costs. By-product revenues at the nickel operations rose 20% to $8,510 per tonne.
Sustaining capex in the nickel segment dropped 42% to $183 million. This followed the commissioning of the Voisey’s Bay mine expansion. Meanwhile, growth investment increased to $32 million to support ongoing mine development.
Vale’s New York-listed shares last traded at $6.71, up C$0.18 or 1.9% for the day. It has a market capitalization of $42 billion.
Peers such as BHP (ASX, NYSE, LSE: BHP) recorded their highest-ever annual copper output of 2.02 million tonnes and iron ore production of 290 million tonnes in fiscal 2025, ended June 30, although it flagged cost overruns and delays at its $7 billion Jansen potash project in Canada. Rio Tinto (ASX, LSE, NYSE: RIO) posted a 16% year-on-year drop in first-half underlying profit to $4.8 billion, driven by a 13% slide in iron ore prices amid weaker Chinese steel demand.
Copper growth
Vale’s group-wide copper output climbed 18% year on year to 66,000 tonnes, with Canadian sales up 28% at 23,000 tonnes. Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) for Vale’s base metals unit jumped 77% to $721 million, split between $538 million from copper and $201 million from nickel offsetting a loss of $18 million marked as ‘other items.’
Pimenta opened the analyst call Friday by framing Vale’s growth ambitions under its ‘Vale 2030’ vision. The plan puts copper growth at its centre. Near-term growth hinges on two projects. In Brazil, Onça Puma’s second furnace will add 12,000–15,000 tonnes per year when it starts in the coming months after reaching 94% commissioning by quarter end.
The New Carajás program marked its first milestone when the Bacaba project in Para state secured a preliminary licence in June. Bacaba will feed the Sossego plant with 50,000 tonnes per year at a capital intensity of $5,400 per tonne and targets start-up in the first half of 2028.
Brazil iron
Elsewhere, Vale’s Iron Ore Solutions unit completed the first shipment from its Capanema project about 80 km from Belo Horizonte in the state of Minas Gerais. The unit shipped 143 million tonnes in the first half, despite a 3% drop in volumes for the three months through June 30.
The average realized fines price slipped 13% in the quarter to $85.10 per tonne, yet operating cash cost fell 11% to $22.20 per tonne, driving 39% pro forma EBITDA margins.
Free-cash surge
Across all segments, net operating revenues totaled $8.8 billion, down 11% year on year. Pro forma EBITDA reached $3.4 billion, off 14% year on year, while recurring free cash flow surged to $1 billion, up 412%, as working capital and lower capital expenditures boosted liquidity.
The company’s net debt fell to $17.4 billion, within Vale’s $10–20 billion target range.
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