Pow ering a new grow th cycle Disclaim er This presentation may - PDF document

1 Santander 1 5 th Annual Latam Conference January, 2 0 1 1 Pow ering a new grow th cycle

Disclaim er “This presentation may include declarations about Vale's expectations regarding future events or results. All declarations based upon future expectations, rather than historical facts, are subject to various risks and uncertainties. Vale cannot guarantee that such declarations will prove to be correct. These risks and uncertainties include factors related to the following: (a) the countries where Vale operates, mainly Brazil and Canada; (b) the global economy; (c) capital markets; (d) the mining and metals businesses and their dependence upon global industrial production, which is cyclical by nature; and (e) the high degree of global competition in the markets in which Vale operates. To obtain further information on factors that may give rise to results different from those forecast by Vale, please consult the reports filed with the Brazilian Comissão de Valores Mobiliários (CVM), the French Autorité des Marchés Financiers (AMF), and with the U.S. Securities and Exchange Commission (SEC), including Vale’s most recent Annual Report on Form 20F and its reports on Form 6K.” 2

Agenda � The profile of a global leader � A promising outlook � Fostering growth 3

4 The profile of a global leader

Vale is one of the largest companies in the world Vale position in the FT 500 ranking¹ 500 400 300 200 100 1 1 8 November 30, 2010 2009 4 2 2008 2 5 2007 7 4 ¹ Ranking of the 500 largest companies in the world by market cap – Financial Times, position on 31 March of each year 2006 1 1 7 1 5 3 2005 2004 2 7 5 2002 2003 3 3 4 4 4 6 5

Vale is a global company, with offices and operations in all continents… Vale in 2010 6

... and a global base of world-class assets Asset base Asset portfolio by geography I ron ore & pellets Asia Aust ralasia Manganese Nickel, 10% 10% & cobalt & Ot her ferroalloys PGMs 1% Nort h America Bauxite, 25% Coal alum ina & alum inum Brazil Potash & Copper 54% phosphates Logistics 7

Vale is the second largest metals and mining company in the world Market capitalization as of December 23, 2010 BHPB 260 in US$ billion 240 US$ 1 7 5 .8 billion 220 VALE 200 RIO TINTO 180 160 ANGLO AMERICAN SOUTHERN COPPER 140 NORILSK NICKEL BARRICK GOLD TECK RESOURCES 120 XSTRATA FREEPORT 100 80 60 40 20 0 8

Vale is the unrivaled leader in shareholder value creation among large diversified miners. Each US$ 100,000 invested in Vale shares ten years ago has grown into US$ 1.5 million in 2010 TSR last 10 years¹ last 5 years¹ Nov/2000-Nov/2010 Nov/2005-Nov/2010 Vale 39.0% 27.7% BHP Billiton 27.2% 23.5% Rio Tinto 20.5% 15.9% Anglo American 15.7% 7.9% Xstrata² n.a. 12.6% ¹ In US$ ² Incorporated in March/2002 Source: Bloomberg 9

10 Hong Kong shareholders distributed throughout the Vale has more than 500,000 Paris São Paulo New York world

Global leadership in iron ore: Vale is the largest iron ore producer based on the world’s best and largest reserves I ron ore production¹ I ron ore reserves² million metric tons million metric tons Vale 16,018 227.5 Vale 3,525 BHPB Rio Tinto 134.6 Rio Tinto 2,720 BHPB 94.4 Anglo 439 American 1 Production in the first nine months of 2010. ² Proven and probable reserves in 2009 Source: Vale and Companies 11

Global leadership in nickel: Vale has the largest nickel reserves Nickel reserves¹ million metric tons of contained nickel Vale 7.9 Norilsk Nickel 6.4 Jinchuan 4.6 Xstrata 2.9 BHP Billiton 2.8 Eramet 2.6 ¹ Proven and probable reserves in 2009, except Norilsk Nickel (2007) 12 Source: Vale and companies

Vale is one of the world’s leading nickel producers Share of world finished nickel production - 2008 Other 37.9% Vale 17.4% Jinchuan 7.6% Xstrata Norilsk BHP 7.8% 20.6% 8.7% Source: CRU Quarterly Q2 2009 13

Strong cash generation and net earnings in US$ billion EBI TDA Net earnings 2006 11.451 2006 7.260 15.774 2007 11.825 2007 2008 19.018 2008 13.218 2009 9.165 2009 5.349 19.392 2010 LTM¹ 2010 LTM¹ 12.866 ¹ Last twelve-month period ended in September 30, 2010. 14

The best ever financial performance: a record-breaking quarter 3Q10 Records QoQ YoY US$ billion Revenues 14.5 46.0% 110.3% Operational income 7.8 69.2% 241.7% Operational margin 55.6% +770 bps +2,140 bps Net earnings 6.0 63.0% 260.0% Adjusted EBITDA 8.8 58.1% 192.5% 15

16 A prom ising outlook

Global IP growth has decelerated Global industrial production % 3mma, saar¹ 20 15 10 5 0 - 5 - 10 - 15 - 20 - 25 - 30 - 35 Jun- 08 Oct- 08 Feb- 09 Jun- 09 Oct- 09 Feb- 10 Jun- 10 Oct- 10 ¹ Seasonally adjusted annualized rate 17 Source: Vale and J.P. Morgan

However, the history of business cycles shows that strong recoveries are followed by deceleration towards moderation I P: global recessions and recoveries Δ peak to trough Δ 1st year Δ 2nd year May/1975 -14.0% 11.0% 5.8% Jul/1980 -5.0% 3.3% -3.7% Dec/1982 -5.9% 9.7% 4.6% Mar/1998 -2.1% 2.0% 5.8% Nov/2001 -5.5% 3.7% 2.6% Mar/2009 -16.5% 11.0% 3.8% 1 Average: -8.2% 6.7% 3.0% 1 Recovery from Mar/2010 to Oct/2010, annualized rate. 18 Sources: Vale, BEA and NBER

Global IP is already issuing signals of a trend reversal Global PMI , sa¹ New orders/ I nventories ratio, sa¹ 1,30 58 57,8 1,25 57 57,0 1 ,24 56,8 1 ,23 56,1 1,20 1 ,20 56 Ratio, sa 1 ,1 7 55,4 Index, sa 1,15 55 1 ,1 5 1 ,1 5 55,0 54,3 53,9 1,10 1 ,1 0 54 53,7 53,7 1 ,06 1 ,04 53 1,05 1 ,05 52,5 1 ,01 52 1,00 jan/10 mar/10 mai/10 jul/10 set/10 nov /10 jan/10 mar/10 mai/10 jul/10 set/10 nov /10 ¹ Seasonally adjusted 19 Sources: Vale and JP Morgan

China’s GDP growth is likely to have bottomed last quarter. We expect growth to reaccelerate driven by domestic demand Chinese GDP grow th¹ % 14.7 11.8 11.6 10.0 8.5 8.0 7.8 6.0 1.0 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 ¹ Saar Source: CEIC and Vale estimates 20

We expect global industrial production to reaccelerate in 1H11 � Global accommodative monetary policy. � Fast growing consumption expenditures in emerging economies. � Recovery of corporate investment. 21

The iron ore market remains tight and quality has become the key factor in global competitiveness, as reflected by the behavior of premia Platts I ODEX¹ US$/ metric ton 172.0 180 160 140 120 100 80 60 40 Sep-09 Dec-09 Mar-10 Jun-10 Sep-10 Dec-10 ¹ Platts Iron Ore Index, 62% Fe content 22 Fonte: Platts

Addressing Chinese concerns with high energy intensity and carbon emissions: Vale green ores � Use of Vale high quality iron ores: - Maximizes energy efficiency, leading to less coke consumption per ton of steel. - Cuts CO 2 emissions. - Increase productivity of blast furnaces. - Positive effects are magnified by the combination of Vale's iron ore and pellets. 23

Nickel prices have been resilient to supply growth given a strong demand and the effects of QE2 Inventories Nickel prices 170 28,000 August 27, 2010 160 26,000 US$ / m etric tons 000' m etric tons 150 24,000 140 22,000 130 20,000 120 18,000 110 16,000 Jan-10 Feb-10 Mar-10 Apr-10 May-10 Jun-10 Jul-10 Aug-10 Sep-10 Oct-10 Nov-10 Dec-10 Source: Bloomberg 24

As destocking is ending, prices of fertilizers are beginning to reverse the downward trend Monthly average prices US$/ metric ton 1,000 600 500 800 400 600 300 400 200 200 100 Potash¹ DAP² 0 0 Jan-09 Mar-09 May-09 Jul-09 Sep-09 Nov-09 Jan-10 Mar-10 May-10 Jul-10 Sep-10 Nov-10 ¹ Fob Vancouver ² Fob Tampa 25 Source: Vale and Fertilizer Week

Grain prices have increased sharply, raising profitability and stimulating the recovery in fertilizer demand Corn Soybeans US$/ bushel US$/ bushel 7.0 14 6.5 13 6.0 12 5.5 11 5.0 10 4.5 9 4.0 8 3.5 3.0 7 Apr- Jun- Aug- Oct- Dec- Feb- Apr- Jun- Aug- Oct- Dec- Apr- Jun- Aug- Oct- Dec- Feb- Apr- Jun- Aug- Oct- Dec- 09 09 09 09 09 10 10 10 10 10 10 09 09 09 09 09 10 10 10 10 10 10 Source: Bloomberg 26

Emerging economies will continue to be the key engine of global growth, with positive implications for the demand of minerals, metals and fertilizers Real GDP grow th Convergence % annual Convergence 9 8 Developed Econom ies 7 Em erging Econom ies 6 5 4 3 2 1 0 - 1 - 2 - 3 - 4 1970 1975 1980 1985 1990 1995 2000 2005 2010E 2015E 27 Sources: Vale and IMF

Real income growth and structural changes are responsible for the key role played by emerging economies in the consumption of minerals, metals and fertilizers Share of emerging economies in global Steel consumption intensity consumption of metals and fertilizers kilos / US$ 1,000 of real GDP 35 90% Iron Ore 30 80% Fertilizers 25 70% Nickel 20 60% Copper 15 50% 10 40% Emerging Economies 5 30% Developed Economies 0 20% 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 1997 1999 2001 2003 2005 2007 2009 28 Source: World Steel Association, WBMS, IMF and Vale