Vale Q1: finished nickel production increased by 6.8% compared with the same period last year. Iron ore powder production increased by 14.2% year-on-year.

Rio de Janeiro, Brazil, 19 April 2021-despite the additional challenges posed by the COVID-19 epidemic in Brazil, Vale continued to press ahead with its iron ore operation stabilization plan, restoring previously suspended capacity at the (Timbopeba) mine in Thimbopeba and the Grand Val (Vargem Grande) pelletizing plant. In terms of the base metals business, the company completed the sale of (VNC) of Vale New Caledonia AG, taking an important step towards the base metals business, allowing it to continue to focus on core assets while simplifying future operating processes. Vale also announced its intention to spin off its coal business and completed the renovation of two concentrators in Moatize (Moatize) in April, which will bring sustainable results to the coal business.

As Vale advances its operational stability and recovery plan, Vale's iron ore powder production reached 68 million tons in the first quarter of 2021, an increase of 14.2 per cent year-on-year. This is mainly due to: (I) the suspension of operations at the integrated mines of Timberpeba, F á brica and Dawalren throughout 2020; (II) the strong operating performance of the Beiling (Serra Norte) mine with low rainfall in January; (III) increased third-party procurement; and (iv) the resumption of operations at the Dongling (Serra Leste) mine. The above positive effects are partially offset by the following factors: (1) maintenance in the S11D integrated mining area is carried out as planned, and (2) the operating performance of the Itabila (Itabira) integrated mining area is relatively low due to tailings disposal restrictions. The output in this quarter decreased by 19.5% from the previous quarter, mainly due to seasonal factors.

According to the operational stability and recovery plan, Vale had an annualized capacity of 327 million tonnes in the first quarter of 2021 due to the commissioning of the mineral processing line (7 million tonnes per annum) at the Timbo Peiba mining area, which was partially offset by operational restrictions in Itabila (Itabira) and Mutuka (Mutuca)), which was previously disclosed.

With the opening of the tailings Filter plant in the Dawaren mining area, the resumption of production plan continues. This is the first of four tailings Filter plants in the state of Minas Gerais. The second tailings Filter plant, located in the Itabilla mine, is expected to be operational by the end of 2021.

In the first quarter of 2021, Vale pellet production was 6.3 million tons, down 9.2% from the same period last year, due to a reduction in the supply of pellet concentrate from the Vale operating area, mainly from the (Itabira) and Brukutu (Brucutu) mining areas. Despite the poor operating performance of the pelletizing plant this quarter, Vale expects pellet production to increase gradually in 2021 as the supply of fine pellet powder in the Thimbopeba and Dawalren mining areas increases.

In the first quarter of 2021, sales of iron ore fines and pellets totaled 65.6 million tons, up 11% from a year earlier, mainly due to an increase in iron ore production, partially offset by a decline in the supply of pellet concentrate. The iron ore premium is $8.3 / tonne, due to a strong recovery in demand outside China, rising coking coal prices in China and a widening gap between the 65 per cent and 62 per cent iron ore price index supported by increased blast furnace productivity demand. Pellet premium increased.

In the first quarter of 2021, finished nickel production (excluding VNC) was 48400 tons, up 6.8 per cent from a year earlier and down 4.7 per cent from a month earlier. The year-on-year increase was due to stable operating performance at the On ç a Puma) mine and strong operating performance at refineries in the North Atlantic system, with the Changgang plant reaching record production levels in the first quarter. The month-on-month decrease is due to the planned maintenance of the Matsuzaka refinery in Japan, resulting in a decrease in the production of finished nickel from the nickel mine mined by (PTVI) in Indonesia. This negative impact is partly offset by the sound operation of the North Atlantic system.

On March 31, 2021, Vale completed the sale of VNC to the Prony Resources New Caledonian consortium. As a result, Vale's production and sales reports and financial reports will no longer include VNC operating information from the second quarter of 2021.

In the first quarter of 2021, copper production was 76500 tons, a decrease of 19.0% year-on-year and 18.2% month-on-month, respectively, due to: (1) the Salobo (Salobo) mining area changed its routine maintenance practices to improve safety and operating conditions, which limited mining activities and affected the grade of fine powder; (2) due to the COVID-19 epidemic in the (Sossego) mining area of Southaigu, the mobility of contract workers was limited, resulting in the maintenance of planned and unplanned maintenance lasting longer than expected. Copper production is expected to be further affected due to continued maintenance activities in the two mining areas, as well as the postponement of maintenance plans for major semi-automatic grinding rigs in the Suosaigu mining area as a result of the COVID-19 epidemic. Normal production will not be restored until the second half of 2021. Taking into account the challenges facing the second half of the year, copper production for the whole year is expected to reach the lower limit of the production guidance range. In addition, the company believes that the COVID-19 epidemic may lead to further postponement of the factory maintenance plan.

In the first quarter of 2021, Vale's base metals business conducted a wide range of operational process safety reviews, comprehensively improving maintenance standards, processes, training and supervision. These additional measures have an impact on the availability of mining equipment in all operating areas during the quarter. We expect the improvements brought about by maintenance to be reflected in the entire base metals business in the second half of 2021.

The coal business completed its maintenance activities in April and is currently debugging new and refurbished equipment. Mines and concentrators are expected to gradually reach production in the second quarter of 2021 and reach a production operation rate of 15 million tons per year in the second half of 2021.