Vale set to pull out of Pecém
Brazilian mining and transport company Vale is on the verge of abandoning its Vale Pecém installations at São Gonçalo do Amarante in the state of Ceará after just two years, given a growing financial deficit. In 2016 and 2017, it lost a combined $37m.
The company was originally set up in the Zona de Processamento de Exportação, or the Export Processing Zone, to exclusively supply iron ore to Companhia Siderúrgica do Pecém (CSP), a joint venture set up by Vale and South Koreans Dongkuk and Posco.
According to independent auditor KPMG in a report delivered on August 14, 2018, there exists “relevant uncertainty regarding the company’s capacity for operational continuity”.
Despite questions about its long-term future, Vale has guaranteed to supply financial support until at least December so that the company can cover its contractual obligations and continue to operate without having to worry too much about its finances.
However, on October 2, 2017, Vale agreed to sell its subsidiary to CSP for $30m.
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