On August 27th, it was learned that the global iron ore giant Vale announced a change in leadership. The newly appointed CEO Gustavo Pimeta is a veteran who has been in the finance, energy, and mining industries for many years, and has previously served as Vice President of Strategy and Mergers and Acquisitions at Citigroup.
The new CEO has a prominent financial background
On August 27th, the reporter learned from Vale that the company announced the appointment of Bi Wenda as the next CEO, who will officially take office on January 1, 2025.
Vale is one of the world's four major iron ore giants, with high-quality iron ore, copper, nickel and other resources in Brazil and other places. The Chinese market is crucial to it. Bi Wenda was appointed as the Executive Vice President of Finance and Investor Relations at Vale in 2021, and has also been responsible for procurement, energy, and decarbonization.
Before joining Vale, he worked for 12 years at Aix Global Power Company, where he served as the company's Global Chief Financial Officer, Director of Planning and Strategy, and Vice President of Performance and Services. During his time working in New York, he served as Vice President of Strategy and Mergers and Acquisitions at Citigroup. He holds a Bachelor's degree in Economics from the Federal University of Minas Gerais and a Master's degree in Finance and Economics from the Getulio Vargas Foundation.
In the second quarter of 2024, Vale's net profit attributable to shareholders of the listed company was $2.769 billion, a year-on-year increase of 210%. It is worth mentioning that although the company's net profit has increased significantly year-on-year, the valuation performance of the black sector enterprises to which the company belongs is far inferior to some non-ferrous enterprises. Since 2024, many star mining stocks have been copper industry stocks. The valuations of Southern Copper and Freeport have approached 40 times, which is 3 to 4 times higher than those of black metal mining companies. Therefore, some companies whose main business is black metal have increased their attention to the copper sector.
Chinese steel mills are important customers of Vale
For this iron ore enterprise, Chinese steel mills are its important customers.
The reporter learned from Vale that in the first half of 2024, the company supplied 85.731 million tons of iron ore and pellets to China, accounting for 60% of the company's global sales; In 2023, Vale will supply 186 million tons of iron ore and pellets to China, accounting for 62% of global sales.
The price level of iron ore in 2024 has decreased compared to 2023. According to data from Shanghai Steel Union, the price of Brazilian fine ore (with an iron content of 65%) imported from Qingdao Port in China ranges from 839 to 1153 yuan/wet ton.
Data source: Shanghai Steel Union
It is worth mentioning that the iron ore industry has a high concentration of supply, and high-quality resources are mostly controlled by the four major mining enterprises. Therefore, top enterprises have a significant impact on the pricing of iron ore.
