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Edited Transcript of VALE5.SA earnings conference call or presentation 27-Apr-17 3:00pm GMT

Thomson Reuters StreetEvents

Q1 2017 Vale SA Earnings Call

Rio de Janeiro May 2, 2017 (Thomson StreetEvents) -- Edited Transcript of Vale SA earnings conference call or presentation Thursday, April 27, 2017 at 3:00:00pm GMT

TEXT version of Transcript

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Corporate Participants

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* André Figueiredo

Vale S.A. - Director of IR

* Clovis Torres

Bahia Mineração Limitada - EVP

* Gerd Peter Poppinga

Vale S.A. - Executive Director of Ferrous Minerals

* Humberto Ramos de Freitas

Vale S.A. - Executive Director of Logistics and Mineral Exploration

* Jennifer Anne Maki

Vale S.A. - Executive Director of Base Metals and CEO of Vale - Canada

* Luciano Siani Pires

Vale S.A. - CFO and Executive Officer for IR

* Murilo Pinto de Oliveira Ferreira

Vale S.A. - President

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Conference Call Participants

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* Alfonso Salazar

Scotiabank Global Banking and Markets, Research Division - Director of Metals and Mining

* Andreas Bokkenheuser

UBS Investment Bank, Research Division - Executive Director, Head of LatAm Mining and Basic Materials and Research Analyst

* Daniel Lurch

Exane BNP Paribas, Research Division - Analyst

* David Wang

Morningstar Inc., Research Division - Analyst, Basic Materials

* Ivano Westin

Crédit Suisse AG, Research Division - Director of Latin American Metals and Mining Research

* Jonathan L. Brandt

HSBC, Research Division - Head of LatAm Cement, Construction and Real Estate Equity Research Team and Senior Analyst, LatAm Metals and Mining, Pulp and Paper

* Marcos Assumpção

Itaú Corretora de Valores S.A., Research Division - Sector Head

* Thiago K. Lofiego

Bradesco S.A. Corretora de Títulos e Valores Mobiliários, Research Division - Research Analyst

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Presentation

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Operator [1]

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Good morning, ladies and gentlemen. Welcome to Vale's conference call to discuss the first quarter of 2017 results. (Operator Instructions) As a reminder, this conference is being recorded, and the recording will be available on the company's website at vale.com at the Investors link. The replay of this conference call will be available by phone until May 3, 2017, on (55) 11-3193-1012 or 2820-4012, access code 4474554#. This conference call and the slide presentation are being transmitted via Internet as well, also through the company's website. Before proceeding, let me mention that forward-looking statements are being made under the safe harbor of the Securities Litigation Reform Act of 1996. Actual performance could differ materially from that anticipated in any forward-looking comments as a result of macroeconomic conditions, market risks and other factors.

With us today are Mr. Murilo Ferreira, Chief Executive Officer, the CEO; Mr. Luciano Siani, Executive Officer of Finance and Investor Relations, CFO; Mr. Peter Poppinga, Executive Officer of Ferrous Minerals; Mr. Roger Downey, Executive Officer of Fertilizers and Coal; Mr. Humberto Freitas, Executive Officer of Logistics and Mineral Research; Ms. Jennifer Maki, Executive Officer of Base Metals; and Mr. Clovis Torres, Executive Officer of Human Resources, Sustainability, Compliance and General Counsel.

First, Mr. Murilo Ferreira will proceed to the presentation. And after that, we will open for questions and answers. It's now my pleasure to turn the call over to Mr. Murilo Ferreira. Sir, you may now begin.

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Murilo Pinto de Oliveira Ferreira, Vale S.A. - President [2]

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Ladies and gentlemen, welcome to our webcast and conference call. Thank you, all, for joining us. It's a pleasure to be here presenting Vale's 2017 first quarter results.

Now moving to the first quarter results. First, I will talk about our financial operational performance.

Vale delivered a sound operational performance in the first quarter of 2017 with production records for first quarter in iron ore, with highlights to the record achieved in the north system and Mozambique with quarterly coal production record. We are on track to achieve our net debt target of USD 15 billion to USD 17 billion. In the first quarter of 2017, our net debt amounted $22.8 billion with a big reduction of roughly $2.3 billion, when compared with fourth quarter of 2016.

Vale's cash balance will be used to continue the implementation of a liability management program, reducing gross debt in 2017. The reduction in our net debt was driven by our strong cash generation in the quarter. EBITDA amounted to USD 4.3 billion, despite the seasonally lower volumes. Cost and expenses amounted $4.2 billion in the first quarter 2017. Cost decreased by $263 million, when compared to the fourth quarter 2016, driven by lower sales volume, notwithstanding the unfavorable impact of exchange rate variations, higher price related cost factors such as leasing of the pellet plants, riots, feed purchased from third parties, higher bunker oil prices and lower dilution of fixed cost and seasonally lower production volumes.

Expenses decreased by about $150 million in the first quarter 2017, when compared to the fourth quarter 2016 with reduction in SG&A, R&D, preoperating expenses and others. Capital expenditure amounted $1.1 billion in the first quarter of 2017. The S11D project continued its successful ramp up, advancing according to plan. In line with our divestment plan, the proceeds from the net disposal of assets amounted $707 million, mainly as a result of the conclusion of the divestment to Mitsui of part of our interest in Moatize II mine in the Nacala logistical corridor. Our focus remains on the strengthening our balance sheet, while maintaining our commitment to shareholders' returns and dividends.

In that regard, we paid out BRL 857 million of shareholders' remuneration in 2016. And we will pay an additional remuneration of BRL 4.667 billion in the next few days. EBITDA from Ferrous Minerals was $4 billion in the first quarter of 2017 is slightly below the previous quarter, mainly as a result of the negative impact of seasonally lower sales volumes, exchange rate variations and the higher bunker oil prices, which were partially offset by higher realized prices.

Despite the recent drop in the Platts index 62%, the price differentials between the high-grade of ore Carajas with 65% ferrous content in low-grade ore with 58% ferrous content remained around $40 throughout the quarter.

Our EBITDA breakeven for iron ore and pellets landed in China remained in line with the fourth quarter 2016 at $30.50 per dry metric ton in the first quarter 2017.

In this quarter, we were able to capture higher pellet premiums, as we renewed our ferrous contracts. Pellet C&F/FOB price increased by almost $25 per ton to $116 per ton in the first quarter of 2017. For years, the Platts index iron ore reference price increased by $15 per ton in the quarter. Base metal adjusted EBITDA amounted $410 million in the first quarter of 2017, decreasing by $130 million when compared to the fourth quarter of 2016, negatively impacted by lower volumes, unfavorable exchange rate variations and one-off provisions for cost normalization in Thompson, after the operational issues there.

In the second quarter of 2017, nickel and copper production will be impacted by the transition to a single furnace operation at Sudbury, and 3-week long surplus plant widely scheduled maintenance shutdown, which occurs every 18 months. We took on -- the furnace offline in mid-March and we are rebuilding and expanding the furnace. The rebuilt furnace will remain in operation post the transition to 1/4 furnace in the second half of the year. With coal, we managed to turn the business around.

Coal EBITDA was USD 61 million, reaching a positive result for a second consecutive quarter, despite lower coal prices. Sales volumes of metallurgical coal amounted 1,054,000 tons in the first quarter 2017, increasing 11% when compared to the fourth quarter 2016. As a result of the quarterly production record achieved in the first quarter of 2017.

Production cost per ton of coal shipped through the Port of Nacala decreased 14% to $83.9 per ton, as a result of the successful ramp up of Moatize II in Nacala Logistics Corridor. We stand firm on pursuing a lower net debt, while we conclude investment cycle and prepare the foundations for even stronger free cash flow generation from 2017 onwards.

In first quarter 2017, we managed to reduce debt by roughly USD 2.3 billion, when compared with the fourth quarter of 2016. Vale's cash balance will be used to implement a liability management program, further reducing gross debt in 2017.

Thank you for your attention. And now, let us open this webcast for your questions.

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Questions and Answers

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Operator [1]

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(Operator Instructions) Our first question comes from Mr. Jon Brandt with HSBC.

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Jonathan L. Brandt, HSBC, Research Division - Head of LatAm Cement, Construction and Real Estate Equity Research Team and Senior Analyst, LatAm Metals and Mining, Pulp and Paper [2]

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I first wanted to ask you about Samarco. I understand you're temporarily suspending some workers. I'm wondering if -- what the new expectation is for startup of Samarco, and if you could remind us of what Vale's obligations are under the agreement with the court. And then secondly, reading through your press release. It seems like you're pretty optimistic on copper prices in the medium to longer-term. I'm wondering if you could give us an update on a potential expansion of the Salobo project? At what point do you think you'd make a decision? How much would it cost? And how long would it take you to actually bring that brownfield project on?

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Murilo Pinto de Oliveira Ferreira, Vale S.A. - President [3]

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Thank you, Jon. I think that at Samarco, we are working hard in order to see Samarco going back to the operations in the second half of this year. And about the court issue, I leave with Clovis Torres.

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Clovis Torres, Bahia Mineração Limitada - EVP [4]

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Well, the issue on the court, actually, what we're doing is that we are extending what is already in place. Is keeping extension of contracts of certain employees, it's not really in court. So there's nothing new about it. We're just renewing it. We had it for a year, and now we're asking for another 6 months. We negotiated with the employees. And the agreement is in line. As you know, the foundation is up and running, carrying up all the work for remediation and compensation as agreed with the different plaintiffs in the lawsuit. So there's nothing new about it either.

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Murilo Pinto de Oliveira Ferreira, Vale S.A. - President [5]

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And Jennifer, please, about copper mainly, some -- and the expansion at Salobo?

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Jennifer Anne Maki, Vale S.A. - Executive Director of Base Metals and CEO of Vale - Canada [6]

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At Salobo III, we just finished our -- what we call our Vale II study and we're moving to the final feasibility study shortly and we expect that to take about a year. And we will be looking at an investment decision in Salobo in the second half of 2018. And I think the interesting thing about Salobo, obviously, it's a world-class asset. And we've done a number of steaming transactions with regards to Salobo. And as part of those transactions, we've prenegotiated a payment that would offset some of the capital costs associated with Salobo and from Silver Wheaton and that payment varies depending on the time you bring on the production and the amount of production brought on.

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Murilo Pinto de Oliveira Ferreira, Vale S.A. - President [7]

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Thank you, Jon.

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Operator [8]

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The next question comes from Andreas Bokkenheuser with UBS.

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Andreas Bokkenheuser, UBS Investment Bank, Research Division - Executive Director, Head of LatAm Mining and Basic Materials and Research Analyst [9]

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Basically, 2 questions. The first one is, we had some headlines this morning from BHP, talking about iron ore prices and talking it down a bit, talking about growing supply and so on, so forth. I got the sense from the Portuguese call earlier this morning, that you mentioned that you think iron ore prices are going to go up from here. I guess, I'm just wondering, what is it that you guys are seeing that makes you slightly more bullish than someone like BHP for example, on iron ore? So that would be my first question. And my second question is on the iron ore inventories. It's something we've talked about before, but they obviously seem pretty high even on inventory days basis and moving into the second half of the year, there is some concern among investors that we're going to see a destocking and an inventory liquidation. I guess, the question is to what point -- to what level does that concern you going into the seasonally weaker period of the second half of the year?

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André Figueiredo, Vale S.A. - Director of IR [10]

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Please, Peter.

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Gerd Peter Poppinga, Vale S.A. - Executive Director of Ferrous Minerals [11]

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Thank you, André. There might be some different assumptions on the timing -- on a time frame. What we are saying here is not the long-term iron ore price. This is a different dynamic. What we were referring to here is the short-term, 2017, and what we think because of the steel demand, which is really going up this year in China, 3% steel production. The recent downturn, this is a hiccup in my and our opinion. Housing is okay. Infrastructure is strong. Capacity closures are going on, which actually helps seaborne supply because of quality. And the stocks in the mines are low, the stocks in the mills are low as well and the stocks in the ports are imbalanced in quality and not so high at all if you measure them against the days of consumption, it's 45 days against 40 days in historical terms. So there's everything there in order to have a healthy average in the whole year. In terms of supply, the cards are on the table. There is no big surprises here. We have -- if you add up the competitors and what are their plans and you come to Roy Hill, you come to Vale itself. So you have some marginal increase in Australia, and -- but -- and some other Brazilians here, but you also have some people exiting.

So you have much less, actually, coming into the seaborne market then came last year, and was easily absorbed. Last year, it was 150 million tons. This year, we are calculating around 70 million tons coming in. And because of the strong market, the demand we think it's going to be absorbed as well. So what we said is -- there is no reason -- first of all, there is no reason why price should be lower than last year. Actually, we think they are going to be significantly higher than last year, and you can look around and we said it should be something around $70 a ton, which actually is the breakeven when you look to some seaborne -- low-quality seaborne marginal players, and which is also not so far away from the breakeven in terms of Chinese concentrates.

About inventories, no, there will be no liquidation at all. We said, this is a trade-off, which we always said from the beginning, actually before (inaudible). The trade-off we deliberately made between investing very high CapEx into this (inaudible) system and then there is the trade-off is a lower quality. But since we have the Carajas to blend offshore, we will do that and it is a highly positive NPV. So momentarily, for some -- maybe for some quarters, you will see an increase in stock, but as soon as the stocks formation stabilize outside offshore then you will see it coming back to normal levels. Thank you.

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Operator [12]

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The next question comes from Daniel Lurch with BNP Paribas.

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Daniel Lurch, Exane BNP Paribas, Research Division - Analyst [13]

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Just a quick question from my side specifically on coal. Could you maybe outline how you expect the fixed-price sales to develop over the next coming quarters? Do you expect that they will decrease in the next quarters? And the second one, just quickly in relation to S11D, you've (inaudible) and focusing according to plan. And could you provide some details on production volumes achieved in Q1 and potential outlook your target is in 2017?

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André Figueiredo, Vale S.A. - Director of IR [14]

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(inaudible), please.

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Unidentified Company Representative, [15]

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The question was a bit garbled. I didn't really understand what the question was about coal there. If you could repeat it slowly, please, because I think that the line is a bit garbled.

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Daniel Lurch, Exane BNP Paribas, Research Division - Analyst [16]

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I'm sorry. The question in relation to coal was, how do you expect your fixed-price sales to develop? There was a mismatch between the hot coking coal and benchmark price and your realized price. And it appeared to be due to the fixed price sales. Would you expect that this is normalizing going forward? Or do you expect that fixed-prices might remain at higher levels? And the second question was in relation to the S11D and the production volume in Q1 and your target in 2017, if you could provide some details.

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Unidentified Company Representative, [17]

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Thank you. Just on the call then, to start off with. It's difficult to say right now with the changing landscape in terms of the benchmark. I think assuming things will carry on as they are, it's a difficult assumption to adopt, to work with. We have several -- a large proportion of our sales already are indexed and therefore not benchmarked with good price realization. As you can see, our price realization in the first quarter of this year was very close to the benchmark and there isn't really any reason why we should make any difference. So I think what we will probably see is a bit more of what we've been seeing in markets outside of Japan. Remember, we do not sell into China yet. We have no need to sell -- haven't had any need to sell into China. Most of our sales go to Korea, Taiwan, Japan, India, South America, Europe, where we have been able to become an important part of our customers' blends. So we don't -- other than the benchmark contracts in Japan, we don't expect a big difference in relation to the other markets.

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Gerd Peter Poppinga, Vale S.A. - Executive Director of Ferrous Minerals [18]

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Regarding to the S11D, as I said in the previous call, we are producing and commissioning at the same time. There are equipments which are almost finalized, but other equipment like the truckers, the mobile crusher and some conveyor belts, they are being commissioned as we speak. So there is no -- in some equipment, there is no production going on at all. In others, there is. So it is very difficult to actually say how much you are producing because of production or how much is being produced due to commissioning. What I offered since the beginning and later we can go down the road when we have a clear cut, we can go in more details, but what we said is the bottleneck is the railway. The bottleneck is the railway in terms of duplication. And this year, the capacity and we will fully utilize. It is 135 million tons. And if you look into 2016, we roughly produced, in the Northern System, 155 million tons, so it's not difficult to calculate what is the additional tonnage coming, which mostly will come from S11D, but can also come a little bit from the Northern System. So this will be determined by the speed of the ramp up and also by the margin optimization. Thank you.

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Operator [19]

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The next question comes from Mr. Alfonso Salazar with Scotiabank.

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Alfonso Salazar, Scotiabank Global Banking and Markets, Research Division - Director of Metals and Mining [20]

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I have 2 questions. The first one is a follow-up on Salobo. You mentioned in your production report that there was some repairs, and there were also the negative impact of lower grades. And I was wondering if you can tell us if this is something that you see is temporary. And what do you expect in terms of copper and gold production in 2017? The second question is regarding inventories, the (inaudible) iron ore inventories. If you can give us some clarity, what to expect in terms of what follows in the next quarters? You have provided guidance for full production, but where do you see shipments for the rest of the year? Do you think that you're going to catch up and have production and shipments similar for the year or higher shipments, if you can give us some color on that?

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André Figueiredo, Vale S.A. - Director of IR [21]

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Jennifer Maki, please.

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Jennifer Anne Maki, Vale S.A. - Executive Director of Base Metals and CEO of Vale - Canada [22]

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I think, on Salobo, the conveyor belt issues we experienced are normal maintenance repairs and they happen from time-to-time as we replace [splices] in the conveyor belts. So we do that probably 3 times a year and take it down for a couple of days. And in terms of the grade variability, I think it's normal grade variation in a pit of that size in Salobo and the forecast for the year is about 200,000 tons of copper at Salobo.

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André Figueiredo, Vale S.A. - Director of IR [23]

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Okay, Peter.

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Gerd Peter Poppinga, Vale S.A. - Executive Director of Ferrous Minerals [24]

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On shipments in this year will be higher than last year, roughly in the same proportion and the production is going up.

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André Figueiredo, Vale S.A. - Director of IR [25]

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Thank you.

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Operator [26]

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The next question comes from David Wang with Morningstar.

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David Wang, Morningstar Inc., Research Division - Analyst, Basic Materials [27]

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My first is on cash costs. It looks like your iron ore cash costs are a little bit higher versus last year despite the ramp up of Carajas. Can you just discuss how the overall cash costs is set to play out with Carajas ramping up? I guess I would expect with a lower cost system coming online, that should somewhat offset the inflationary pressures that you might be seeing?

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André Figueiredo, Vale S.A. - Director of IR [28]

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Please, Peter.

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Gerd Peter Poppinga, Vale S.A. - Executive Director of Ferrous Minerals [29]

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Thanks for the question. We were heavily penalized by the bunker going up and also by the exchange rate, which is not playing in our favor. But if you look to the cash cost in the C1 cost in Reals, you can see that we reduced from one quarter to the other, our C1 cost in Reais, in spite of the inflation and some nonrecurring costs. I would say that under similar FX conditions and bunker conditions we have today, I would say for the first half of the year, we will be around in the range of 14 to 14.5, that is because of lower volumes in the first half. And in the second half, aiming to come back to 13.5 again. But, again, under similar conditions for FX and bunker. On the freight rate, there was a recent uptick but freight is very volatile and, again, it is about the bunker. On the sustaining CapEx, if you look carefully and if you make -- it is very difficult to judge from one quarter to the other, but if you go and check what happened in 2015, we had a sustaining CapEx of $3.4 per ton. In 2016, we have -- we came down to $2.6 per ton. And of course, the number will be higher in 2017, but mainly also because of the FX. If you equalize for the FX, you will have -- you will see, on the average of the year, probably sustaining numbers very similar to 2016. Thank you.

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Operator [30]

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The next question comes from Thiago Lofiego with Bradesco BBI.

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Thiago K. Lofiego, Bradesco S.A. Corretora de Títulos e Valores Mobiliários, Research Division - Research Analyst [31]

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Peter, just one follow-up question. What do you think could trigger a destocking at Chinese wharves? We know that most of the material is low-grade, and so we haven't actually seen any kind of significant destocking happening. And then when we think about steelmakers' margins in China, they have been tightening up, right? I mean, we are seeing lower steel prices, higher coking coal, when you compare to a few months ago, couple of months ago. So margins are tighter in China. Do you think that could be a driver or a trigger for steelmakers finally wanting to procure cheaper low-grade ore versus more expensive high-grade ore and then that could trigger destocking? What's your view about that?

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Gerd Peter Poppinga, Vale S.A. - Executive Director of Ferrous Minerals [32]

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Thank you, Thiago. I think the port inventory, as we said is imbalanced in quality. But when you look at the ports -- when you look at the stocks in the mines and in the mills, they are very low level now. So you can see already a restocking in the mines and in the mills. The mines catching up in terms of production because of domestic concentrates and the mills restocking as well. And so I think it's happening already, but it will be very painful, slow process to get rid of all these lower quality ore. And so I think it's a gradual process and I have no doubt that, that market will come into balance once the -- again, it comes in uptick because of the robust steel demand and especially maybe in the next weeks when there are some announcements again about the one road initiatives and other fiscal stimulus for political reasons eventually, potentially coming. You will see those tons moving very quickly. Thank you.

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Operator [33]

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The next question comes from Ivano Westin with Crédit Suisse.

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Ivano Westin, Crédit Suisse AG, Research Division - Director of Latin American Metals and Mining Research [34]

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The first one, Peter, is a follow-up on the inventory level. You mentioned on the Portuguese call, the inventory increased in the last years. I'd just like to clarify, what was the exactly volume that increased in quarter 1? What is the total volume that you have in inventories? And what is the normalized inventory level you expect to achieve and when? And the second question is for Jennifer, if you could comment on VNC cash cost. It lowered well in quarter 1, especially due to higher cobalt bi-product price. There is a positive outlook for cobalt, so I just wonder if you expect overall cash cost of VNC to be below $11,000?

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Gerd Peter Poppinga, Vale S.A. - Executive Director of Ferrous Minerals [35]

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Ivano, thank you for the questions. We have not disclosed in detail our inventory, because it's along the whole supply chain and in the past we were focused on the inventory in Brazil. This went down drastically. Actually last year, the inventory came down as well. This year, as I said, there will be a slight increase in inventories and we don't know when this will stabilize. But it is part of our strategy to come to a certain level and to move the inventory downstream. And at the same time, try to reduce it. The downstream move is succeeding well. The reduction cannot happen so easily this year because of the increasing bending but it is a temporary situation and will be sorted out probably in 2018, when we have a stable inventory level. And then it will go down again. Thank you.

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André Figueiredo, Vale S.A. - Director of IR [36]

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Jennifer?

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Jennifer Anne Maki, Vale S.A. - Executive Director of Base Metals and CEO of Vale - Canada [37]

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In New Caledonia, definitely, they've benefited from the doubling of the cobalt price from a year ago at cost of $55,000 a ton today. I do believe that in the second half of the year that we'll see the unit cash cost at VNC in the range of $10,500 to $11,000 a ton. In the second half of the year, we have increased production on a monthly basis, which will help dilute the fixed cost and in addition, we're in the middle of executing -- taking in another, I would say, $30 million to $40 million of operating costs from VNC this year. So with all that, I expect it will be below $11,000 for sure.

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Operator [38]

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The next question comes from Marcos Assumpção with Itaú BBA.

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Marcos Assumpção, Itaú Corretora de Valores S.A., Research Division - Sector Head [39]

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Two quick questions. The first one on coke and coal -- sorry, on the coal operation. If you could just confirm that the current logistic contract that you have on the Santa Beta corridor, when do you expect that to finalize? And if we could probably see any improvement in profitability of the whole operation -- on the call operation, following the end of that contract? And the second question for Murilo, more strategic question. You spent the last 6 years in a company, did a very good job like turning around the company. Where would you like to see the company positioned in 5 years' time?

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André Figueiredo, Vale S.A. - Director of IR [40]

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Humberto, please.

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Humberto Ramos de Freitas, Vale S.A. - Executive Director of Logistics and Mineral Exploration [41]

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The contract in Santa Beta will finish in the end of this year. After that, we will have lower cost and enough capacity to have all the material in the Nacala corridor.

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Luciano Siani Pires, Vale S.A. - CFO and Executive Officer for IR [42]

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Marcos, this is Luciano. Just to add, with the interest of Mitsui, there will be now the charging of tariffs from the corridor to the mine. So therefore, the coal business will have a hit in terms of EBITDA because of this increase in tariff, which starts now. Small increase, it will be higher after the project finance but it will start in the second quarter. On the other hand, because of the relationships of Vale with the corridor, being a 50% owner, we shall get some of the results of the corridor that will fall through the tariff, but in other lines of the financial statements, equity, income, and so on.

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Murilo Pinto de Oliveira Ferreira, Vale S.A. - President [43]

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And about your question, Marcos, for sure, I would like to see Vale providing the best return in the mining industry. They're having a huge discipline in terms of capital and I believe that paying high dividends for sure. I think that, instead of through accumulating cash, are looking for some project, not being so world-class project. I think that the best that Vale can provide is a good return in terms of dividends. But in terms of the company is be efficient, very efficient to be the first quartile in all of segments, and to continue our leadership mainly in iron ore and nickel. And looking for the future in terms of copper. I think that will have some exploration activities that can provide good opportunities, mainly in Indonesia and Brazil and in Sudbury. And I think that in this context, being the most efficient company in the world in terms of return to the shareholders. I would like to express at the end of this call, to express my gratitude to the analysts, to the investors. I have reserved many comments in this field. I'm extremely happy with the support, but I would like to share with my colleagues in the executive board and the whole company. Thank you very much. I hope to see you soon.

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Operator [44]

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That does conclude Vale's conference call for today. Thank you very much for your participation. You may now disconnect.