Jeb Blount – Reuters/Chicago Tribune, 10/11/2012
Roger Agnelli, who was forced out as chief executive of Brazil’s Vale in May 2011, may have been lucky to leave the world’s second-largest mining company when he did.
Since Murilo Ferreira replaced him as CEO, a series of setbacks have raised questions about Vale’s ability to increase sales and profit and maintain its place as the world’s top producer of iron ore, the main ingredient in steel.
Costs are soaring, new mines are behind schedule and growth in China, Vale’s largest market, is slowing. The price of iron ore, responsible for nearly three-quarters of the Rio de Janeiro-based company’s sales, recently sank to three-year lows.
Making matters worse, Brazilian laws and government interference threaten to hobble Vale, the country’s biggest exporter. Vale shipped $42 billion of raw materials in 2011, 16 percent of exports from the world’s sixth-largest economy.