Brazilian miner and iron ore producer Vale said late this week it expects to report impairment charges of $3.2 billion for its coal and base metals businesses in its Q4 results.
Vale said the impairments are due to predictability issues at its New Caledonia base metals production as well as technical problems within its coal businesses. Each segment will report a $1.6 billion impairment in Q4, totaling $3.2 billion.
As for coal, Vale said its updated forecasts for the business will result in reduced “proven coal reserves” and revised coal prices.
Vale said its new plan for the coal business will prioritize higher quality coal reserves, to “maximize the metallurgical coal share on the product mix and with a lower stripping ratio.”