Iron realities dominate Vale's 2025 capex plan despite rising appetite for energy minerals

Brazil's biggest mining company, Vale, has unveiled details of its mid-term capex plans, highlighting an increasing emphasis on minerals tied to the energy transition while maintaining a strong commitment to its core product, iron ore.

"Vale aims to expand its share of production of minerals associated with the energy transition, primarily copper, but it will not cease to be a global leader in iron ore. Therefore, investments in iron ore will continue to surpass those in other minerals in the coming years," mining consultant Pedro Galdi told BNamericas.

"Vale will never be a global powerhouse in copper or nickel as it is in iron ore, so it doesn’t make sense for the company to stake everything on copper or nickel," Galdi added.

For 2025, Vale estimates its total capex at US$6.5bn, up from US$6.1bn planned for 2024. Of the 2025 total, US$2.0-2.5bn will be allocated to energy transition minerals, particularly copper and nickel, while US$4.0-4.5bn will go toward iron ore solutions.

Looking further ahead, Vale projects annual capex to remain at US$6.5bn, with the portion dedicated to energy transition minerals increasing to US$2.5-3.0bn, while spending on iron ore solutions will range between US$3.5bn and US$4bn.

These projections were presented during Vale's annual investors' day in New York, marking the first such event with Gustavo Pimenta as CEO. At the event, Pimenta told reporters that Vale is evaluating the acquisition of iron ore miner Bahia Mineração (Bamin) but emphasized that no decision has been made yet.

Production outlook

For iron ore, Vale anticipates production of 328Mt in 2024, with output projected to range between 325Mt and 335Mt in 2025. The company expects gradual growth to 360Mt by 2030.

Pellet and briquette production is forecast at 38Mt this year, with a target of 60-70Mt by 2030.

In the copper segment, Vale projects 345,000t of production in 2024, with significant growth to 500,000t by 2030. This expansion will be driven by the development of the Bacaba and Alemão copper projects in Pará state. By 2035, Vale expects annual copper production to reach 750,000t.

For nickel, Vale forecasts production of 160,000t in 2024, rising to 160,000-175,000t in 2025. By 2030, production is expected to reach 210,000-250,000t, supported by advances in projects such as Salobo, Sossego, and Alemão in Brazil, alongside its operations in Canada.