Brazilian mining giant Vale has cut estimated 2013 spending by $5.1 billion and reshuffled its plans to focus on the iron ore sector.
According to a regulatory filing on Monday Vale cut spending on new projects, research, and existing developments due to sluggish growth in the United States, China, and Europe, Reuters reports.
"The outlook for slower expansion of global demand for minerals and metals in the medium term requires rigid discipline in the allocation of capital and greater focus in maximizing efficiency and reducing costs," the company said in a statement.
Among the cuts the company removed the Simandou iron ore mine in Guinea, the Lubambe copper mine in Zambia, and the Samarco IV pellet plant, shared with BHP Billiton, from the list of active projects.
It’s also considering selling aluminium and logistics assets, and just as in 2013, the company will spend 47 per cent of its new budget on iron ore expansions.
According to Reuters Vale gets around 90 per cent of its profit from iron ore, but has cut the 2013 outlook for sales by 1.9 per cent to 306 million tonnes.
Spending on coal projects is expected to rise 3.7 per cent to account for over 10 per cent of next year’s budget, but the company expects to sell 12.4 million tonnes of coal in 2013, a quarter less than the 2012 estimate.
Overall Vale said it needed to continue research programs to find cheaper and more efficient ways to mine.