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Vale’s Performance in 3Q16

Rio de Janeiro, October 27th, 2016

Nacala Coal Port, Mozambique

1

Disclaimer

“This presentation may include statements that present Vale’s expectations about

future events or results. All statements, when based upon expectations about the

future, 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 Autorité des 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.”

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Operational performance

Financial performance

Capital expenditures

Capital structure

DOCUMENT CONTENT

3

Operational performance

Financial performance

Capital expenditures

Capital structure

DOCUMENT CONTENT

4

PRODUCTION VOLUMES

Nickel

Kt

Copper3

Kt

Gold

'000 oz

Phosphate Rock

Mt

Iron ore1

Mt

Coal

Mt

Pellets2

Mt

1 Includes iron ore fines, lump, ROM, iron ore feed for Vale’s pellet plants and third party ore purchases. Excludes Samarco’s attributable

production.2 Excludes Samarco's attributable production.3 Includes Lubambe’s attributable production.

88.7

86.3

77.4

89.3

90.7

88.4

77.5

86.8

92.1

3Q14

4Q14

1Q15

2Q15

3Q15

4Q15

1Q16

2Q16

3Q16

11.4

11.6

11.4

12.2

12.2

10.4

11.5

10.0

12.1

72.1

73.6

69.2

67.1

71.6

82.7

73.5

78.5

76.0

104.8

105.4

107.2

104.9

99.3

112.5

111.9

107.4

111.4

84.0

93.6

102.7

100.0

100.0

117.0

118.0

109.0

118.0

2.3

2.3

1.7

2.0

2.1

1.6

1.7

1.5

2.3

2.2

2.2

2.0

2.1

1.9

2.1

1.6

1.8

2.1

5

PRODUCTION VOLUMES YEAR-ON-YEAR

Iron Ore1

Mt

Pellets2

Mt

Nickel

Kt

6.1%

Copper3

Kt

12.2%

1 Includes iron ore fines, lump, ROM, iron ore feed for Vale’s pellet plants and third party ore purchases. Excludes Samarco’s

attributable production.2 Excludes Samarco’s attributable production and includes third party purchases.3 Includes Lubambe’s attributable production.

Gold

'000 oz

18.0%

90.792.1

3Q15 3Q16

12.2 12.1

3Q15 3Q16

71.6

76.0

3Q15 3Q16

99.3

111.4

3Q15 3Q16

100.0

118.0

3Q15 3Q16

-1.0%1.5%

6

SALES VOLUMES

Iron ore1

Mt

Nickel

Kt

Copper2

Kt

Gold

'000 oz

Phosphate Rock

Mt

Coal

Mt

Pellets

Mt

1 3Q16 figure includes 74.2 Mt of iron ore ex-ROM and 0.4 Mt of ROM. Excludes Samarco’s attributable production.2 Excludes Lubambe’s attributable production.

66.6

78.2

62.3

71.4

74.1

80.8

63.3

73.1

74.6

3Q14

4Q14

1Q15

2Q15

3Q15

4Q15

1Q16

2Q16

3Q16

11.5

12.7

11.3

12.2

12.0

10.8

11.1

11.4

12.0

71.0

69.0

68.0

67.0

72.0

84.0

74.0

77.0

77.0

97.5

95.2

97.0

97.5

94.4

108.0

101.0

107.0

107.0

106.9

96.5

96.9

109.1

104.5

114.0

115.0

122.0

129.0

2.1

2.1

1.6

1.7

1.7

1.6

2.7

2.8

2.4

0.7

0.9

0.7

0.9

0.8

0.8

0.7

0.7

0.9

7

SALES VOLUMES YEAR-ON-YEAR

Iron Ore¹

Mt

Pellets

Mt

0.7% 0.3%

Copper²

Kt

13.3%

Gold

‘000 oz

23.4%

Nickel

Kt

6.9%

74.1 74.6

3Q15 3Q16

12.0 12.0

3Q15 3Q16

72.0

77.0

3Q15 3Q16

94.4

107.0

3Q15 3Q16

104.5

129.0

3Q15 3Q16

¹ 3Q16 figure includes 74.2 Mt of iron ore ex-ROM and 0.4 Mt of ROM. Excludes Samarco’s attributable production.

² Excludes Lubambe’s attributable production.

.

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Operational performance

Financial performance

Capital expenditures

Capital structure

DOCUMENT CONTENT

9

ADJUSTED EBITDA1

US$ billionAdjusted EBITDA margin (%)

3.0

2.2

1.6

2.21.9

1.4

2.0

2.4

3.0

90.2

74.3

62.458.4

54.9

46.7 48.3

55.758.6

3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16

33.1

1 Adjusted EBITDA excludes non-recurring effects.

Platts IODEX Iron Ore Price

Average (US$/t)

24.1 25.7 31.8 28.8 23.6 35.1 36.0 41.3

10

1,652

(129)

193

197

(38)

1,875

ADJUSTED EBITDA BY BUSINESS SEGMENT1

US$ million

3Q16 2Q16 3Q15

2,136

(110)

376

32

(51)

2,383

2,493

(7)

600

59

(122)

3,023

Ferrousminerals

Coal

Base metals ² ³

Fertilizernutrients

Others

Total

1 Adjusted EBITDA excludes non-recurring effects.2 Includes copper and by-products from our nickel and copper operations.3 Includes US$ 150 million of the goldstream transaction.

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EVOLUTION OF COSTS AND EXPENSES

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 Includes US$ 150 million of the goldstream transaction.

4,1793,929

4,056

3Q15 2Q16 3Q16

-2.9%

470

431

245

3Q15 2Q16 3Q16

-47.9%

3

12

100 107 116

31 3337

3Q15 2Q16 3Q16

131140

153

121

78 85

3Q15 2Q16 3Q16

EVOLUTION OF EXPENSES

SG&A

US$ million

Pre-operating and stoppage expenses

R&D Other expenses

Depreciation

183

85 95

83

29 27

3Q15 2Q16 3Q16

122

113160

-51

3Q15 2Q16 3Q16

266

114

1 Includes US$ 150 million of the goldstream transaction.

1

13

54.650.0

46.9 47.0 47.5 46.142.2

1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16

EVOLUTION OF IRON ORE FINES C1 CASH COST1

R$/t

-22.7%

1 2015 figures were adjusted to the new allocation criteria, as reported in the 4Q15, and include acquisition costs of third

party purchased ore.

-10.0%

14

1 Ex-ROM and ex-royalties. All figures were adjusted according to the new managerial allocation changes, as reported in the 4Q15, and include

acquisition costs of third party purchased ore.2 Net of depreciation.3 Ex bunker oil hedge.

13.2 13.2 13.0

3Q15 2Q16 3Q16

EVOLUTION OF IRON ORE FINES CASH COST, FREIGHT AND

EXPENSES

C1 Cash Cost FOB Port1 Freight

US$/t

-1.5%

16.4

11.8 12.0

3Q15 2Q16 3Q16

-26.8%

Expenses2 & Royalties

3.5

4.0

3.2

3Q15 2Q16 3Q16

-8.6%

3

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EVOLUTION OF IRON ORE SUSTAINING CAPITAL

US$/dmt

2.7

2.1

2.9

1.8

2.5

3Q15 4Q15 1Q16 2Q16 3Q16

2.3Last twelve

months

16

13.0

12.0

3.2 0.4

2.5 1.529.6 1.3

28.3

2.5 30.8

C1 CashCost¹

Freight Royalties &Expenses

Distribuition Moisture Quality EBITDABreakevenIron Ore

fines

PelletAdjustment

EBITDABreakeven(pellets &

fines)

Sustaining Iron Ore &PelletsCash

Breakeven

BREAKEVEN LANDED IN CHINA FOR IRON ORE AND PELLETS

US$/t

1 Ex-ROM.

Cost landed in China

17

58.6 59.3

50.9

1.3 0.2 1.6 0.4 0.8 1.2

3.8

4.6

AveragePlatts

3Q16 (dmt)

Quality Premium/Discount and commercial

conditions

Provisionalprices in

prior quarter¹

Laggedprices

Current Provisionalprices

in currentquarter²

CFR reference price (dmt)

Adjustmentfor

FOB Sales

Moisture Vale CFR/FOB price

(wmt)³

US$/t, 3Q16

PRICE REALIZATION – IRON OREUS$/t

1 Adjustment as a result of provisional prices booked in 2Q16 at US$ 52.7/t.2 Difference between the weighted average of the prices provisionally set at the end of 3Q16 at US$ 54.4/t based on forward curves and

US$ 58.6/t from the 3Q16 IODEX.

³ Vale price is net of taxes.

+ 0.7

Impact of pricing system adjustments

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IRON ORE PRICING SYSTEMS

Impact of Pricing Mechanisms

US$ / t

Pricing System Breakdown

%

Provisional - prior quarter Lagged

Current Provisional - current quarter

2.01.6

2Q16 3Q16

-1.2-0.4

2Q16 3Q16

-0.6 -0.8

2Q16 3Q16

-1.0 -1.2

2Q16 3Q16

14% 11%

52% 61%

34%28%

2Q16 3Q16

Lagged

Current

Provisional

19

1,652

392 121 63

77 93 37

201

174 2,493

EBITDA3Q15

Price FX Bunker Commercialinitiatives

Volume CFR FreightSales

Cost savinginitiatives

Others EBITDA3Q16

FERROUS MINERALS EBITDA VARIATION

US$ million, 3Q16 vs. 3Q15

US$ 508M

20

Operational performance

Financial performance

Capital expenditures

Capital structure

DOCUMENT CONTENT

21

EVOLUTION OF CAPITAL EXPENDITURES

US$ million

1,232

905741

647

463

516

1,879

1,3681,257

3Q15 2Q16 3Q16

Sustaining Growth Projects

-33.1%

22

S11D INVESTMENT GROWTH

S11D Mine and Plant – Plant and stockyards S11D Logistics – Railway spur

S11D (including mine, plant and associated logistics – CLN S11D) achieved combined physical

progress of 83% in 3Q16 with 95% progress at the mine site and 74% at the logistic infrastructure sites

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PROJECT PROGRESS INDICATORS

3Q16

ProjectCapacity

Mtpy

Estimated

start-up

Executed capex

US$ million

2016 Total

Estimated capex

US$ million

2016 Total

Physical

progress

Carajás Serra Sul S11D 90 2H16 755 5,411 890 6,4052 95%

CLN S11D 230 (80)1 1H14 to 1H20 951 5,418 1,154 7,8503 74%

1 - Net additional capacity.2 - Original Capex budget of US$ 8.089 billion.3 - Original Capex budget of US$ 11.582 billion.

.

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Operational performance

Financial performance

Capital expenditures

Capital structure

DOCUMENT CONTENT

25

24,213

27,508

25,965

3Q15 2Q16 3Q16

DEBT POSITION

Gross Debt

US$ million

Net Debt

Cash position on

September 30, 2016

5,484

28,67531,814 31,449

3Q15 2Q16 3Q16

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FINANCIAL INDICATORS1

4.8 4.55.0

3Q15 2Q16 3Q16

Interest coverage - Ratio

3.1

3.6

2.9

3Q15 2Q16 3Q16

Net Debt / LTM2 EBITDA - Ratio

8.3

7.6 7.7

3Q15 2Q16 3Q16

Maturity - years

4.37 4.23 4.34

3Q15 2Q16 3Q16

Cost of Debt - %

1 Ex-Refis.2 LTM – last twelve months. Excluding non-recurring items.

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FREE CASH FLOW – 3Q16

US$ million

1 Dividends and interest on capital received from associates and joint ventures and paid to noncontrolling interest, including dividends paid

related to MBR (US$ 127 million).2 Includes the proceeds from the goldstream transaction of US$ 276 million relative to the sale of mining rights.3 Includes transactions with non-controlling stockholders.4 Cash flow before debt additions/repayments and distribution of dividends.

3,227 423

204 191

1,249

129

593 2 1,622 414

-1,208

Cashgenerated

fromoperations

Intereston loans

Incometaxes

& Refissettlementprogram

Derivatives Capex Netdividendsreceived/

paid ¹

Net disposal/acquisition

of assets andinvestments ²

Others ³ FreeCashFlow

Netadditions/

repaymentsof loans

Dividendspaid toshare-holders

Increase incash & cashequivalents4

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PERFORMANCE OF VALE’S SHARES COMPARED TO PEERS

Index, 01/01/2016 = 100

50

100

150

200

250

Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16

Vale US

Peer 1

Peer 2

74%

Price variation

since 01/Jan/2016¹

36%

18%

1 Stocks’ prices until September 30th 2016.

Source: Bloomberg.

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