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Vale Base Metals CEO Shaun Usmar says the unit is targeting $5 billion in pre-tax profit in 2026, up from about $1.3 billion in 2024. He attributes the goal to cost reductions, stronger copper prices and operational changes; the company’s earnings target is a forecast, not a reported result.
Vale Base Metals aims to increase annual pre-tax profit to $5 billion in 2026, more than three times the roughly $1.3 billion it recorded in 2024, CEO Shaun Usmar said at a Toronto industry event. The goal reflects management’s expectations for lower costs and stronger operating performance, alongside higher copper prices; it is a target, not a confirmed 2026 result.
Usmar announced the target Monday at the Canadian Institute of Mining, Metallurgy and Petroleum’s Capital Projects Symposium. The Northern Miner reported that Vale Base Metals, or VBM, also generated more than $1 billion in free cash flow this year, according to the CEO. The report did not provide a detailed breakdown of the 2026 profit forecast or specify the assumptions behind it.
The company’s operating and financial backdrop includes rising copper prices. Vale’s third-quarter results showed its average realized copper price increased 56% year over year to $15,314 per tonne, compared with a 44% rise in the London Metal Exchange benchmark price. VBM’s 2024 business also consumed about $2 billion in cash, according to the report, underscoring the scale of the change implied by the earnings goal.
VBM reported producing 382,300 tonnes of copper and 177,200 tonnes of nickel in 2025, increases of 10% and 11%, respectively, from the previous year. It is targeting annual output of 420,000 to 500,000 tonnes of copper and 210,000 to 250,000 tonnes of nickel by 2030, and about 700,000 tonnes of copper a year by 2035. Those are production targets; the company has not said those volumes are guaranteed.
Profit Target Depends on Cost and Growth
The $5 billion profit goal would represent a substantial shift from the roughly $1.3 billion reported for 2024, and would make the unit’s ability to control project spending and improve operations central to Vale’s metals strategy. Copper-price strength has helped the recent outlook, but market prices can change; the forecast also depends on VBM delivering the cost and production improvements Usmar described.
The strategy has a broader supply-chain dimension. VBM is seeking to expand copper and nickel output as Western governments look to secure supplies of critical minerals and reduce reliance on China. Usmar argued that VBM can draw on established Canadian mining and processing facilities and copper assets in Brazil rather than relying solely on costly new operations. Whether those advantages translate into the stated earnings and output targets remains to be seen.
For investors, workers and communities where the company operates, the plan points to a mix of operational changes, expansion projects and greater use of existing infrastructure. The reported targets do not, by themselves, establish how benefits or costs will be distributed, or how quickly individual projects will be approved and built.
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Projects Shift Toward Existing Districts
Usmar said VBM is revising how it plans and executes capital projects after years of missed production targets and about $10 billion in capital project overruns over 18 years, as described in the source report. He said the company has cut projected capital spending across its development portfolio by more than 30% and raised expected rates of return from the low-to-mid teens to more than 20%. These figures are management’s assessments, not independently verified outcomes in the report.
A Brazilian brownfield project illustrates the proposed approach. Usmar said its original design was expected to cost more than $500 million. After he joined VBM in late 2024, he rejected the design and ordered a reassessment; the revised project, he said, needs nearly half the initial capital investment. The report does not name the project or provide its revised budget, schedule or approval status.
VBM’s growth plans include increasing throughput in Sudbury, Ontario, ramping up underground production at the Voisey’s Bay nickel mine in Labrador, and developing copper projects in Brazil’s Carajás district. The company is also increasing exploration drilling, targeting 140,000 metres this year compared with about 30,000 metres in 2024. Its Canadian operations combine mines with smelting and refining facilities, which Usmar described as valuable assets that can support additional production.
“We aren’t just a turnaround story; we’re also a growth story.”
— Shaun Usmar, Vale Base Metals CEO, at the CIM Capital Projects Symposium
Forecast Assumptions Remain Unspecified
The 2026 profit figure is a management target. The report does not give a full forecast model, including assumptions for copper and nickel prices, production volumes, exchange rates, operating costs or capital spending. It also does not identify how much of the projected increase is expected to come from price movements versus operating changes.
Several elements of the growth plan remain subject to execution. The source does not provide complete schedules, permitting status or updated budgets for the projects discussed, and it does not say when the Brazilian redesign will be approved or completed. Productivity gains at Canadian operations are described as an opportunity, but no quantified production increase or timetable is provided for those improvements.
The reported production figures and targets also use different time references: 2025 output is presented as the latest annual production figure, while the earnings target is for 2026 and the longer-range production goals extend to 2030 and 2035. The report does not explain whether the 2025 figures are final audited results.
Execution Will Test the 2026 Goal
VBM’s next test is whether it can deliver the operating changes and project redesigns underpinning Usmar’s forecast. Investors and other readers can track upcoming Vale financial results for reported earnings, cash flow, realized metal prices, production volumes and capital expenditure, while comparing those figures with the company’s stated targets.
Further details on the Brazilian project’s revised cost and schedule, as well as progress at Sudbury, Voisey’s Bay and Carajás, would clarify how much planned growth can be achieved using existing facilities. The source report does not give a date for further project updates or specify a formal milestone before the 2026 earnings target.
Key Questions
What earnings target did Vale Base Metals set?
CEO Shaun Usmar said VBM aims for $5 billion in pre-tax profit in 2026. The figure is a target, not a reported result.
How does that compare with the unit’s earlier profit?
The report puts VBM’s pre-tax profit at about $1.3 billion in 2024. Usmar’s 2026 goal is more than three times that amount.
What does Vale Base Metals say will support the increase?
Usmar cited cost reductions, project redesigns, operating improvements and stronger copper prices. The report does not give a detailed breakdown of how much each factor is expected to contribute.
What production growth is VBM targeting?
VBM targets annual production of 420,000 to 500,000 tonnes of copper and 210,000 to 250,000 tonnes of nickel by 2030. It aims for about 700,000 tonnes of copper annually by 2035.
Has VBM confirmed it will reach $5 billion in 2026?
No. The $5 billion figure is a forecast from the CEO. Actual results will depend on prices, production, costs and project execution, among other factors.
Source: northernminer.com
