DBRS lowers Vale

DBRS said it downgraded the ratings of Vale SA and its subsidiaries to BBB (low) from BBB.

The trends remain negative.

The markets for Vale’s key commodities, especially iron ore, have continued to deteriorate, which caused further weakening in operating earnings and cash flows, DBRS said.

The ratings reflect the company’s substantial business strengths as the lowest cost producer of iron ore in the world, the agency said.

Despite some progress made to diversify operating earnings away from its overwhelming reliance upon ferrous minerals in previous years, this division remains the primary driver of sales and operating earnings, DBRS said.

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