0

Apimec – Belo Horizonte

Rogério Nogueira

Vale S.A.

August 09, 2016

1

Dis

clai

mer“This presentation may include statements that

present Vale's expectations about future events or results. All statements, when based upon expectations about the future and not on historical facts, involve various risks and uncertainties. Vale cannot guarantee that such statements will prove correct. These risks and uncertainties include factors related to the following: (a) the countries where we operate, especially Brazil and Canada; (b) the global economy; (c) the capital markets; (d) the mining and metals prices and their dependence on global industrial production, which is cyclical by nature; and (e) global competition in the markets in which Vale operates. To obtain further information on factors that may lead to results different from those forecast by Vale, please consult the reports Vale files with the U.S. Securities and Exchange Commission (SEC), the Brazilian Comissão de Valores Mobiliários (CVM) and the French Autoritédes Marchés Financiers (AMF), and in particular the factors discussed under “Forward-Looking Statements” and “Risk Factors” in Vale’s annual report on Form 20-F.”

2

Agen

da

1. Market dynamics

2. Impact on Vale’s performance

3. Samarco

4. Paving the future

3

Market dynamics

4

35

40

45

50

55

60

65

70

4-Jan 4-Feb 4-Mar 4-Apr 4-May 4-Jun 4-Jul

40.5%

29.6%

Percentual price increase from

Jan 4, 2016 to July 29, 2016

Commodities prices increased year to date reflecting a more positive sentiment, mainly in China

Source: Bloomberg.

US$/ton

Iron Ore

Nickel Copper

Metallurgical Coal

75

80

85

90

95

100

105

110

4-Jan 4-Feb 4-Mar 4-Apr 4-May 4-Jun 4-Jul

7500

8200

8900

9600

10300

11000

4-Jan 4-Feb 4-Mar 4-Apr 4-May 4-Jun 4-Jul

22.7%

4200

4400

4600

4800

5000

5200

4-Jan 4-Feb 4-Mar 4-Apr 4-May 4-Jun 4-Jul

4.5%

5

The positive sentiment is significantly based on the credit expansion in China with a record of bonds’ issuance by the Chinese government

-10

0

10

20

30

40

50

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Local government bond

Corporate bond

Off-balance sheet credit

RMB & FX loans

Overall credit

% yoy 3-month moving average, seasonally adjusted

Source: UBS, CEIC.

6

-5

5

15

25

35

45

55

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Total

Infrastructure

Real estate

Manufacturing

-40

-20

0

20

40

60

80

100

Floor spacesold

Floor spacestarted

Source: UBS, CEIC.

Real estate marketFixed Asset Investment (FAI)

% growth y/y, 3 months moving average % growth y/y, 3 months moving average

Resulting in a greater incentive in fixed asset investment in China, particularly in infrastructure and real state market

7

1 Seaborne market, including pellets.

Source: World Steel Association and Vale.

804 796 801 804 807 810

819 816 836 855 878 899

1,623 1,612 1,637 1,659 1,685 1,709

2015 2016 2017 2018 2019 2020

Ex-China crude steel production

Chinese crude steel production

201157

149135 122 1201,610 1,629

1,6831,739 1,750 1,752

2015 2016 2017 2018 2019 2020

Chinese domestic

Seaborne market of iron ore

Seaborne market1 iron ore supply

In this context, the expectations for Chinese steel production improved, potentially absorbing additional iron ore supply

Crude steel production

Mt Mt

8

17

114

222

14799

-93

2011 2012 2013 2014 2015 2016E

1,991 1,981 1,909

2014 2015 2016E

-4%-1%

The nickel market will record a potential deficit¹ in 2016 with lower

global nickel supply

The nickel supply should decrease 4% in 2016, primarily because of the reduction of NPI in China and

because of the increase of uncertainty regarding the nickel ore export industry in the Philippines, which is the

main supplier of nickel to the NPI production.

World Nickel Supply

Kt

Supply and Demand Balance1

Kt

1 Supply and demand balance excluding the inventories in the LME and SHFE.

Source: Market analysts (CRU Q3 Outlook; Wood Mackenzie July Short Term Outlook, Wood Mackenzie Q2 Long Term Outlook).

9

Due to favorable arbitrage, inventories have migrated

towards Shanghai Exchange, with total inventories

within the historical range

We expect a surplus in the copper market in 2016,

with a tight market in the following years

In 2016, we expect a surplus in the copper market, with a tight

market in the following years

Source: CRU Copper Outlook Quarterly Report 2Q16, metalprices.com

Kt Kt

-225

38

-553

-198-31

322 383328

110

-277

-

100

200

300

400

500

600

700

800

900

1,000

LME

Comex

Shanghai

Global balance in refined copper World Copper inventories in Exchanges

10

Impact on Vale’s

performance

11

0

50

100

150

200

250

300

350

400

1962 1968 1974 1980 1986 1992 1998 2004 2010 2016²

Iron Ore

Metallurgical Coal

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

1962 1968 1974 1980 1986 1992 1998 2004 20102016²

Copper Nickel

1 Nominal prices for 2015 and 2016 and real prices for the previous years.2 Average until July 29th, 2016.

Source: Bloomberg, World Bank, Wood Mackenzie and CRU.

Despite recent prices increases, commodities’ prices are returning

to a historical level

US$/t

Base Metals1 Bulk materials1

12

-33%

6,857

4,521

3,547

1,861

2012 2013 2014 2015

-73%

22,661

20,52021,207

16,984

2012 2013 2014 2015

3

4

Our focus and managerial discipline allowed us a substantial

reduction in costs and expenses, despite an increase in volumes

Costs¹

US$ million

Expenses1,2

US$ million

1 Net of depreciation and amortization.2 Includes SG&A, R&D, Pre-operating and stoppage and other expenses. Does not include gain/loss on sale of assets.3 Positive impact of US$ 244 million from the goldstream transaction on the 1Q13.4 Positive impacts of US$ 230 million from the goldstream transaction on the 1Q15 and US$ 331 million of Asset Retirement

Obligations - ARO).

13

3.8

4.9 5.0

2013 2014 2015

299.8319.2 333.4

2013 2014 2015

Nickel Copper3

260275

291

2013 2014 2015

+11.8%

+11.2%

370 380424

2013 2014 2015

+14.5%

30.0%

Kt Kt

Iron Ore1,2 Coal (Moatize)

Mt Mt

With the start-up of new projects and an increase in productivity,

we have increased production volumes in different commodities

1 Includes iron ore fines, lump, ROM and iron ore feed for Vale’s pellets plants.2 Excludes Samarco’s attributable production.3 Includes Lubambe’s attributable production. 2013 figure include Tres Valles production.

14

4.1

3.0

2.21.6

2.21.9

1.42.0

2.4

102.6

90.2

74.3

62.458.4 54.9

46.7 48.355.7

2T 3T 4T 1T 2T 3T 4T 1T16 2T16

US$ billion, quarterly EBITDA

1 Adjusted EBITDA excludes gains and/or losses on sales of assets and non-recurring expenses and includes dividends received from

non-consolidated affiliates.

2014 2015

EBITDA

41.4 33.1 24.1 25.7 31.8 28.8 23.6 35.1 36.0

Despite seasonally lower sales volumes, recent price hikes and

continuous cost discipline boosted Vale’s adjusted EBITDA1 in 2Q16

Adjusted EBITDA margin (%)

Platts IODEX Iron Ore Price

Average (US$/t)

15

57.6

39.336.9

32.630.9

28.0 28.5

4T14 1T15 2T15 3T15 4T15 1T16 2T16

-51%

1 Considers: [Cash cost + Royalties + freight + distribution + expenses(SG&A + R&D + pre-operating and stoppage expenses) +

moisture, adjusted for quality and pellets premiums] / [iron ore sales volume (ex ROM)].

US$/t

Iron ore and pellets EBITDA breakeven on a landed in China basis1

decreased in a consistent way

16

We have been increasing our discipline in capital allocation with

significant reduction in capital expenditures

1 Considers exchange rate of BRL/USD 3.50 - 3.80.

Capex, US$ billion

11.7 11.6

9.6

7.9

5.5

4.6 4.6

4.6

4.1

2.9

16.3 16.2

14.2

12.0

8.4

5.5 – 6.0

2011 2012 2013 2014 2015 2016E¹

Sustaining

Growth Projects

17

8.16.5

11.6

7.9

0.60.2

Original Budget Total Until 2015 2016 2017 2018 2019

Logistics

Mine and plant

Mine, plant and logistics

1.6

2.6

9.414.4

19.7

Our biggest growth project – the S11D – will complete most of its

investment in the next 2 years

1 Includes project expenses, that are not capitalized, of US$ 289 million accumulated until 2015, US$ 84 million in2016, US$ 52 million

in 2017, US$ 15 million in 2018 and US$ 5 million in 2019.

US$ billion1

18

The S11D project reached significant progress in the mine, plant

and railway until now

S11D Plant – Screening, crushing and patios Status June 2016

• Combined physical progress of 79%

− 90% of physical progress at the

mine site

− 70% of physical progress at

logistic sites

− 92% of physical progress at the

railway spur

• Cold commissioning on the mine site

initiated

• Duplication of the railway with 54%

physical progress and 243 Km

delivered

• Railway spur connection to EFC

Railway concluded

S11D Logistics – Port offshore

19

The project will function with dry processing and will not need tailings dams

Screening Process Process’ Highlights

• High Fe content and highly homogenous

ore body allows the dry processing,

without any concentration process

• 18,000 MWh of electricity saved every

year (equivalent to a 20,000 inhabitants’

city)

• Lower environmental impact (lower water

consumption and no need for tailings

dams)

• Simpler process reducing capital

investment and sustaining investment,

mainly on tailings dams

20

26,509

27,661 27,508

2Q15 1Q16 2Q16

Our debt slightly decreased in 2Q16

Gross Debt

US$ million

Net Debt

Cash position

June 30, 2016

4,306

29,77331,470 31,814

2Q15 1Q16 2Q16

21

Fixed rate69%

Floating rate31%

US$90%

Other currencies

10%

0.53.2

4.02.9

20.5

31.1

2016 2017 2018 2019 2020onwards

Grossdebt

US$ billion

In parallel, we continue to manage our current debt profile

Debt amortization schedule¹ Debt profile, after currencies hedge

1 As of June 30th, 2016.2 Does not include accrued interest.

75% of debt maturities after 2019

2

22

Samarco

23

Basic Financial

Structure

Operationalization

of the agreement

Reparatory and

Compensatory

Programs

The agreement with the Brazilian authorities will allow the acceleration

of reparatory programs, complementing the actions already iniciated

Secondary

responsability of

shareholders

• R$ 4.4 bi in the first three years (2016-2018) to guarantee the progress of reparatory

and compensatory programs while projects are being detailed

• R$ 0.8 – 1.6 bi per year between 2019 and 2021, the value will be defined based on

the prioritization of each program’s projects

• R$ 240 million per year for 15 years (starting on the signature of the agreement) to

the execution of compensatory projects

• Payment of R$500 million to finance sanitation initiatives between 2016 – 2018

• Establishment of a Foundation that will develop and execute environmental and

socio-economic programs

• The Foundation will be governed by a seven member Board, appointed by Samarco,

BHP, Vale and the Brazilian Authorities and supported by advisory panels

• Restoration of the environment and the social conditions of the affected areas

• Compensation where reparation is not possible, for example:

– Basic sanitation project for the affected areas

– Reconstruction of Bento Rodrigues and Paracatu de Baixo

• In case Samarco does not meet its funding obligations with the Foundation, both Vale

and BHP will provide funds to the Foundation in proportion to their current

shareholding stakes in Samarco (50%)

24

Impact on Vale’s

financial results

Resumption of

Samarco’s

operations

Environmental

licensing process

The uncertanties on the potential resumption of Samarco’s

operations had an impact on Vale’s financial results

1 State Department for Environmental and Sustainable Development of Minas Gerais.2 Equivalent to the present value of its estimated secondary responsibility under the Agreement.

• Samarco filed on June 23, 2016 the Environmental Impact Study and the Environment

Impact Report (EIA / RIMA) in the SEMAD1, as part of the licensing process for the

use of exhausted pits for tailings disposal

• Vale provisioned R$ 3.7 billion2 in its interim financial statements as of June 30, 2016

• Vale expects to contribute about US$ 150 million to the Foundation in 2H16, with this

amount offset against the abovementioned R$ 3.7 billion provision

• Vale intends to make available, in addition, short-term facilities of up to US$ 100

million to Samarco to support its operations

• Nonetheless, Samarco and its shareholders still expect Samarco to generate a

significant portion of the funds required to meet its obligations as per the Agreement

• Samarco cannot currently make a reliable estimation of how and when its operations

will be resumed, given the current status of the licensing process

• Samarco’s current assessment is that the probability of resuming operations in 2016 is

highly unlikely

25

Paving the future

26

2016 and 2017 will be years for optimizing of our business with

the continuous structural reduction of cost and expenses

Our main priority is to strengthen our balance sheet together

with the increase in our Free Cash Flow

1

2

From the strategic and financial point of view, we are preparing

ourselves to face the current uncertainties of our industry

27

1

2

Source: Vale’s internal data.

22 mines in 4

production

systems

3 railways and 4

ports in Brazil

12 pelletizing

plants (Brazil

and Oman)

2 DCs and 5

blending ports

In iron ore, our integrated supply chain offers operational flexibility to maximize margins

28

1

2

• Reduction of losses in New

Caledonia

• Optimization of operational flows

and progress in Long Harbour’s

ramp-up, with further reduction

of costs and expenses in the

North Atlantic

• Potential expansion steps

already identified in the

operations in Indonesia,

leveraging the resource base

and the existing brownfield

opportunities

In nickel, business in which we are the world’s largest producer, our portfolio will be further optimized

29

1

2

• Completion of the ramp-up of Salobo tapping into a new rich

resource base

• Optimization of copper concentrate production in North Atlantic

operations with revision of our production flowsheet

• The late cycle of the commodity balances Vale’s business

portfolio

• Start-up of the Patrocínio phosphate rock project by 2017 will

generate an additional estimated EBITDA of US$ 80-90

million

• Ramp-up of the Nacala Logistics Corridor will increase our

competitiveness in the coal business, reducing around 60% of

COGS when compared to 2015

• Operational improvements in Mozambique are paving the way

for better results in our coal business

Copper

Coal

Fertilizers

In copper, coal and fertilizers we will improve our competitive position in the near future

30

2

1

• Our discipline in capital allocation will enable a significant

CAPEX reduction from 2015 to 2016

• The portfolio simplification in the range of US$ 4 to 5 billion will

help us improve our cash flow and reduce our leverage

• The execution of the ongoing initiatives will allow a solid cash

generation at any price scenario

Our main priority is to strengthen our balance sheet together with the increase in our Free Cash Flow

31

Evaluation of additional transactions,

aiming at reducing net debt by US$ 10

billion

• Coal JV

• Precious metals streaming

• 7 VLOCs

• Energy assets

• Definition of the future assets portfolio

• Assessment of the value of potential

transactions

• Estimate of the potential debt

reduction associated with potential

transactions

2016

2016 - 2017Asset portfolio simplification,

totaling US$ 4 – 5 bilhões

2

1

Potential divestments and strategic transactions will help balance

free cash flow and strengthen the balance sheet

32

We will be competitive, independently of prices

Strong balance sheet

World-class

assets

Lowcapex

• Assets well positioned in the cost

curve

• Capital allocation discipline with

lower sustaining capex

requirements

• Low leverage, with long debt

maturity

33