A Brazilian commodities giant with mines for major China-driven minerals is firing on all fronts and doesn’t plan to quit anytime soon.
Vale (VALE) reported strong Q1 earnings on the back of a booming market for iron ore, nickel, and other minerals. The company also reported relatively strong earnings during the recession thanks to their prescient belief that previous China fears were overblown.
It may be fashionable and seem prudent to predict a hard China crash, but Vale doesn’t think it’s profitable.
Iron ore is rising to record highs. This chart shows how the seaborne market is essentially all China-driven
As for the bubble question, VALE believes Chinese fundamentals are strong and demand will continue, despite regulatory efforts or potential economic shocks.
They've been investing billions for years, due to their high conviction in the prospects for their commodities.
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