6-K 1 tm2131065d2_6k.htm FORM 6-K

United States

Securities and Exchange Commission

Washington, D.C. 20549

FORM 6-K

Report of Foreign Private Issuer

Pursuant to Rule 13a-16 or 15d-16

of the

Securities Exchange Act of 1934

For the month of

October 2021

Vale S.A.

Praia de Botafogo nº 186, 18º andar, Botafogo
22250-145 Rio de Janeiro, RJ, Brazil

(Address of principal executive office)

(Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.)

(Check One) Form 20-F x Form 40-F o

(Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1))

(Check One) Yes o No x

(Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7))

(Check One) Yes o No x

(Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.)

(Check One) Yes o No x

(If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b). 82- .)

Interim Financial Statements

September 30, 2021

BRGAAP in R$ (English)

Vale S.A. Interim Financial Statements

Contents

	Page
Report on review of quartely information		3
Consolidated and Parent Company Income Statement		5
Consolidated and Parent Company Statement of Comprehensive Income		7
Consolidated and Parent Company Statement of Cash Flows		8
Consolidated and Parent Company Statement of Financial Position		10
Consolidated Statement of Changes in Equity		11
Consolidated and Parent Company Value Added Statement		12
Notes to the Interim Financial Statements		13
1. Corporate information		13
2. Basis of preparation of the interim financial statements		13
3. Significant events in the current period		13
4. Information by business segment and by geographic area		14
5. Costs and expenses by nature		19
6. Financial results		20
7. Income taxes		20
8. Basic and diluted earnings per share		21
9. Accounts receivable		22
10. Inventories		22
11. Other financial assets and liabilities		23
12. Acquisitions and divestitures		24
13. Investments in subsidiaries, associates and joint ventures		27
14. Intangible		28
15. Property, plant and equipment		29
16. Financial and capital risk management		30
17. Financial assets and liabilities		37
18. Participative stockholders’ debentures		38
19. Loans, borrowings, leases, cash and cash equivalents and short-term investments		39
20. Brumadinho’s dam failure		41
21. Liabilities related to associates and joint ventures		45
22. Provisions		47
23. Litigations		48
24. Employee benefits		50
25. Stockholders’ equity		51
26. Related parties		52
27. Parent Company information (individual interim information)		54

Report on review of quarterly information

To the Board of Directors and Stockholders

Vale S.A.

Introduction

We have reviewed the accompanying consolidated and parent company interim accounting information of Vale S.A. ("Company"), included in the Quarterly Information Form (ITR) for the quarter ended September 30, 2021, which comprises the parent company and consolidated statements of financial position as of September 30, 2021 and the respective parent company and consolidated income statements and the statements of comprehensive income for the three and nine-month periods then ended, the statement of changes in equity for the nine-month period then ended, the parent company statement of cash flows for the nine-month period then ended and the consolidated statements of cash flows for the three and nine-month periods then ended, and a summary of significant accounting policies and other explanatory information.

Management is responsible for the preparation of the consolidated and parent company interim accounting information in accordance with the accounting standard CPC 21, Interim Financial Reporting, of the Brazilian Accounting Pronouncements Committee (CPC) and International Accounting Standard (IAS) 34, Interim Financial Reporting issued by the International Accounting Standards Board (IASB), as well as the presentation of this information in accordance with the standards issued by the Brazilian Securities Commission (CVM), applicable to the preparation of the Quarterly Information (ITR). Our responsibility is to express a conclusion on this interim accounting information based on our review.

Scope of review

We conducted our review in accordance with Brazilian and International Standards on Reviews of Interim Financial Information (NBC TR 2410 - Review of Interim Financial Information Performed by the Independent Auditor of the Entity and ISRE 2410 - Review of Interim Financial Information Performed by the Independent Auditor of the Entity, respectively). A review of interim information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Brazilian and International Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion on the interim information

Based on our review, nothing has come to our attention that causes us to believe that the accompanying consolidated and parent company interim accounting information included in the quarterly information referred to above has not been prepared, in all material respects, in accordance with CPC 21 and IAS 34 applicable to the preparation of the Quarterly Information, and presented in accordance with the standards issued by the CVM.

Other matters

Value added statements

The quarterly information referred to above includes the parent company and consolidated statements of value added for the nine-month period ended September 30, 2021. These statements are the responsibility of the Company's management and are presented as supplementary information under IAS 34. These statements have been subjected to review procedures performed together with the review of the interim accounting information for the purpose of concluding whether they are reconciled with the interim accounting information and accounting records, as applicable, and if their form and content are in accordance with the criteria defined in the accounting standard CPC 09 - "Statement of Value Added". Based on our review, nothing has come to our attention that causes us to believe that these statements of value added have not been properly prepared, in all material respects, in accordance with the criteria established in this accounting standard, and consistent with the parent company and consolidated interim accounting information taken as a whole.

Rio de Janeiro, October 28, 2021

PricewaterhouseCoopers	Patricio Marques Roche
Auditores Independentes Ltda.	Contador CRC 1RJ081115/O-4
CRC 2SP000160/O-5

Income Statement
In millions of Brazilian reais, except earnings per share data

								Consolidated
		Three-month period ended September 30,						Nine-month period ended September 30,
	Notes	2021			2020			2021			2020
Net operating revenue	4(c)		66,261			57,906			223,409			129,591
Cost of goods sold and services rendered	5(a)		(30,533	)		(25,893	)		(86,505	)		(67,775	)
Gross profit			35,728			32,013			136,904			61,816

Operating expenses
Selling and administrative expenses	5(b)		(603	)		(684	)		(1,889	)		(1,864	)
Research and evaluation expenses			(708	)		(563	)		(2,003	)		(1,476	)
Pre-operating and operational stoppage	3 and 20		(858	)		(1,011	)		(2,648	)		(3,480	)
Brumadinho event	20		(847	)		(613	)		(2,437	)		(2,014	)
Other operating expenses, net	5(c)		(162	)		(612	)		(638	)		(2,161	)
			(3,178	)		(3,483	)		(9,615	)		(10,995	)
Impairment and disposals of non-current assets	12 and 15		(12,622	)		(1,608	)		(15,700	)		(4,004	)
Operating income			19,928			26,922			111,589			46,817

Financial income	6		475			370			1,331			1,576
Financial expenses	6		(678	)		(6,571	)		(9,178	)		(11,993	)
Other financial items, net	6		(1,736	)		(1,179	)		7,594			(10,040	)
Equity results and other results in associates and joint ventures	13 and 21		670			(211	)		(1,688	)		(3,763	)
Income before income taxes			18,659			19,331			109,648			22,597

Income taxes	7(b)
Current tax			(12,867	)		(4,018	)		(27,409	)		(7,352	)
Deferred tax			14,782			(241	)		8,356			5,341
			1,915			(4,259	)		(19,053	)		(2,011	)

Net income			20,574			15,072			90,595			20,586
Net income (loss) attributable to non-controlling interests			371			(543	)		(267	)		(1,302	)
Net income attributable to Vale's stockholders			20,203			15,615			90,862			21,888

Earnings per share attributable to Vale's stockholders:
Basic and diluted earnings per share:
Common share (R$)	8		3.98			3.04			17.94			4.27

The accompanying notes are an integral part of these interim financial statements.

Income Statement
In millions of Brazilian reais, except earnings per share data

							Parent company
	Three-month period ended September 30,						Nine-month period ended September 30,
	2021			2020			2021			2020
Net operating revenue		72,587			39,698			178,123			83,346
Cost of goods sold and services rendered		(16,689	)		(11,939	)		(44,094	)		(30,498	)
Gross profit		55,898			27,759			134,029			52,848

Operating income (expenses)
Selling and administrative expenses		(281	)		(344	)		(986	)		(944	)
Research and evaluation expenses		(407	)		(241	)		(974	)		(621	)
Pre-operating and operational stoppage		(470	)		(957	)		(1,797	)		(3,118	)
Equity results and others results from subsidiaries		(25,999	)		3,461			(2,800	)		3,456
Brumadinho event		(847	)		(613	)		(2,437	)		(2,014	)
Other operating expenses, net		(424	)		(747	)		(1,385	)		(2,590	)
		(28,428	)		559			(10,379	)		(5,831	)
Impairment and disposals of non-current assets		(212	)		(76	)		(335	)		(214	)
Operating income		27,258			28,242			123,315			46,803

Financial income		292			74			608			626
Financial expenses		(624	)		(6,409	)		(8,809	)		(11,822	)
Other financial items, net		(1,836	)		(1,373	)		832			(8,187	)
Equity results and other results in associates and joint ventures		670			(211	)		(1,688	)		(3,763	)
Income before income taxes		25,760			20,323			114,258			23,657

Income taxes
Current tax		(12,388	)		(3,298	)		(25,654	)		(5,713	)
Deferred tax		6,831			(1,410	)		2,258			3,944
		(5,557	)		(4,708	)		(23,396	)		(1,769	)

Net income attributable to Vale's stockholders		20,203			15,615			90,862			21,888

Earnings per share attributable to Vale's stockholders:
Basic and diluted earnings per share:
Common share (R$)		3.98			3.04			17.94			4.27

The accompanying notes are an integral part of these interim financial statements.

Statement of Comprehensive Income

In millions of Brazilian reais

							Consolidated
	Three-month period ended September 30,						Nine-month period ended September 30,
	2021			2020			2021			2020
Net income		20,574			15,072			90,595			20,586
Other comprehensive income (loss):
Items that will not be reclassified to the income statement
Retirement benefit obligations (note 24)		498			422			2,270			(624	)
Fair value adjustment to investment in equity securities (note 11)		834			815			1,901			312
		1,332			1,237			4,171			(312	)

Items that may be reclassified to the income statement
Translation adjustments		7,310			3,753			3,009			25,967
Net investments hedge (note 16)		(662	)		(458	)		(441	)		(3,484	)
Net cash flow hedge (note 16)		50			(299	)		(56	)		(291	)
Reclassification of cumulative translation adjustment to net income (note 12)		(48	)		-			(8,490	)		-
		6,650			2,996			(5,978	)		22,192
Total comprehensive income		28,556			19,305			88,788			42,466
Comprehensive income (loss) attributable to non-controlling interests		688			(726	)		(108	)		(2,976	)
Comprehensive income attributable to Vale's stockholders		27,868			20,031			88,896			45,442

							Parent company
	Three-month period ended September 30,						Nine-month period ended September 30,
	2021			2020			2021			2020
Net income		20,203			15,615			90,862			21,888
Other comprehensive income (loss):
Items that will not be reclassified to the income statement
Retirement benefit obligations		(7	)		210			(17	)		191
Fair value adjustment to investment in equity securities		685			680			1,559			344
Equity results		654			347			2,629			(847	)
		1,332			1,237			4,171			(312	)

Items that may be reclassified to the income statement
Translation adjustments		6,993			3,936			2,850			27,641
Net investments hedge		(662	)		(458	)		(441	)		(3,484	)
Net cash flow hedge		31			-			56			-
Equity results		19			(299	)		(112	)		(291	)
Reclassification of cumulative translation adjustment to net income		(48	)		-			(8,490	)		-
		6,333			3,179			(6,137	)		23,866
Total comprehensive income		27,868			20,031			88,896			45,442

Items above are stated net of tax and the related taxes are disclosed in note 7.

The accompanying notes are an integral part of these interim financial statements.

Statement of Cash Flows

In millions of Brazilian reais

	Consolidated
	Three-month period ended September 30,						Nine-month period ended September 30,
	2021			2020			2021			2020
Cash flow from operations (a)		53,261			29,916			149,534			50,141
Interest on loans and borrowings paid (note 19)		(904	)		(1,117	)		(3,204	)		(3,126	)
Cash received (paid) on settlement of derivatives, net (note 16)		114			(672	)		(674	)		62
Interest on participative stockholders' debentures paid (note 18)		-			-			(1,073	)		(506	)
Income taxes (including the settlement program)		(5,172	)		(2,509	)		(18,301	)		(6,189	)
Net cash provided by operating activities		47,299			25,618			126,282			40,382

Cash flow from investing activities:
Capital expenditures (notes 14 and 15)		(6,526	)		(4,693	)		(18,099	)		(14,893	)
Additions to investments (note 13)		-			(1	)		(237	)		(366	)
Acquisition of NLC, net of cash (note 12)		-			-			(11,800	)		-
Disbursement related to the disposal of VNC (note 12)		-			-			(3,134	)		-
Dividends received from associates and joint ventures (note 13)		24			10			254			419
Short-term investment		2,193			-			834			3,318
Investment fund applications		-			(172	)		-			(672	)
Other investments activities, net		98			(557	)		(959	)		(1,562	)
Net cash used in investing activities		(4,211	)		(5,413	)		(33,141	)		(13,756	)

Cash flow from financing activities:
Loans and borrowings from third-parties (note 19)		-			9,585			1,633			34,004
Payments of loans and borrowings from third-parties (note 19)		(573	)		(29,368	)		(8,506	)		(31,674	)
Lease payments (note 19)		(297	)		(244	)		(860	)		(726	)
Dividends and interest on capital paid to stockholders (note 25)		(40,200	)		(18,492	)		(73,112	)		(18,492	)
Dividends and interest on capital paid to non-controlling interest		(16	)		(15	)		(47	)		(56	)
Share buyback program (note 25)		(14,854	)		-			(25,261	)		-
Net cash used in financing activities		(55,940	)		(38,534	)		(106,153	)		(16,944	)

Increase (decrease) in cash and cash equivalents		(12,852	)		(18,329	)		(13,012	)		9,682
Cash and cash equivalents at the beginning of the period		68,275			66,333			70,086			29,627
Effects of exchange rate changes on cash and cash equivalents		3,634			1,885			1,983			10,580
Cash and cash equivalents at end of the period		59,057			49,889			59,057			49,889

Non-cash transactions:
Additions to property, plant and equipment - capitalized loans and borrowing costs		75			67			235			274

Cash flow from operating activities:
Income before income taxes		18,659			19,331			109,648			22,597
Adjusted for:
Provisions related to Brumadinho event (note 20)		-			-			-			108
Equity results and other results in associates and joint ventures (note 13)		(670	)		211			1,688			3,763
Impairment and disposal of non-current assets		12,622			1,608			15,700			4,004
Depreciation, depletion and amortization		3,657			4,162			12,146			12,174
Financial results, net (note 6)		1,939			7,380			253			20,457
Changes in assets and liabilities:
Accounts receivable		20,399			(1,513	)		22,351			(4,031	)
Inventories		(2,984	)		(1,626	)		(4,952	)		(3,157	)
Suppliers and contractors (i)		1,851			1,064			1,969			(1,260	)
Provision - Payroll, related charges and other remunerations		305			792			(886	)		538
Payments related to Brumadinho event (note 20) (ii)		(973	)		(1,176	)		(3,410	)		(2,975	)
Other assets and liabilities, net		(1,544	)		(317	)		(4,973	)		(2,077	)
Cash flow from operations (a)		53,261			29,916			149,534			50,141

(i) Includes variable lease payments.

(ii) In addition, the Company has incurred in expenses in the amount of R$847 and R$2,437 for the three and nine-month periods ended September 30, 2021, respectively (R$613 and R$1,906 for the three and nine-month periods ended September 30, 2020).

The accompanying notes are an integral part of these interim financial statements.

Statement of Cash Flows

In millions of Brazilian reais

	Parent company
	Nine-month period ended September 30,
	2021			2020
Cash flow from operations (a)		144,605			34,181
Interest on loans and borrowings paid		(3,993	)		(4,426	)
Cash paid on settlement of Derivatives, net		(896	)		(735	)
Interest on participative stockholders' debentures paid		(1,073	)		(506	)
Income taxes (including the settlement program)		(16,439	)		(5,379	)
Net cash provided by operating activities		122,204			23,135

Cash flow from investing activities:
Capital expenditures		(10,644	)		(7,534	)
Additions to investments		(598	)		(1,563	)
Proceeds from disposal of assets and investments		59			174
Dividends received from associates and joint ventures		254			422
Short-term investment		542			3,234
Investment fund applications		-			(672	)
Other investments activities, net (i)		(11,005	)		7,807
Net cash used in investing activities		(21,392	)		1,868

Cash flow from financing activities:
Loans and borrowings from third-parties		1,633			25
Payments of loans and borrowings from third-parties		(7,913	)		(3,210	)
Lease payments		(204	)		(136	)
Dividends and interest on capital paid to stockholders		(73,112	)		(18,492	)
Share buyback program		(15,574	)		-
Net cash used in financing activities		(95,170	)		(21,813	)

Increase in cash and cash equivalents		5,642			3,190
Cash and cash equivalents at the beginning of the period		14,609			9,597
Effects of disposals of subsidiaries and merger, net of cash and cash equivalents		1,195			188
Cash and cash equivalents at end of the period		21,446			12,975

Non-cash transactions:
Additions to property, plant and equipment - capitalized loans and borrowing costs		235			274

Cash flow from operating activities:
Income before income taxes		114,258			23,657
Adjustments for:
Provisions related to Brumadinho event		-			108
Equity results and others results from subsidiaries		2,800			(3,456	)
Equity results and other results in associates and joint ventures		1,688			3,763
Impairment and disposal of non-current assets		335			214
Depreciation, depletion and amortization		6,266			5,984
Financial results, net		7,369			19,383
Changes in assets and liabilities:
Accounts receivable		17,201			(14,555	)
Inventories		(401	)		(853	)
Suppliers and contractors (ii)		1,400			(116	)
Provision - Payroll, related charges and other remunerations		(148	)		539
Payments related to Brumadinho event (note 20) (iii)		(3,410	)		(2,975	)
Other assets and liabilities, net		(2,753	)		2,488
Cash flow from operations (a)		144,605			34,181

(i) Includes loans and advances with related parties.

(ii) Includes variable lease payments.

(iii) In addition, the Company has incurred in expenses in the amount of R$847 and R$2,437 for the three and nine-month periods ended September 30, 2021, respectively (R$613 and R$1,906 for the three and nine-month periods ended September 30, 2020).

The accompanying notes are an integral part of these interim financial statements.

Statement of Financial Position

In millions of Brazilian reais

			Consolidated					Parent company
	Notes		September 30, 2021		December 31, 2020			September 30, 2021		December 31, 2020
Assets
Current assets
Cash and cash equivalents		19		59,057		70,086			21,446		14,609
Short-term investments		19		2,834		4,006			892		1,811
Accounts receivable		9		4,747		25,944			30,175		46,559
Other financial assets		11		7,430		1,707			6,144		37
Inventories		10		27,659		21,103			7,536		6,142
Recoverable taxes				4,484		2,646			2,192		1,036
Others				2,199		1,313			1,510		2,199
				108,410		126,805			69,895		72,393

Non-current assets held for sale		12		326		-			-		-
				108,736		126,805			69,895		72,393
Non-current assets
Judicial deposits		23(c)		6,644		6,591			6,495		6,265
Other financial assets		11		883		9,271			562		3,838
Recoverable taxes				7,188		5,670			3,704		2,244
Deferred income taxes		7(a)		62,020		53,711			44,618		42,760
Others				3,710		3,380			938		725
				80,445		78,623			56,317		55,832

Investments		13		11,418		10,557			164,071		181,319
Intangible		14		48,483		48,309			27,908		28,243
Property, plant and equipment		15		223,492		213,836			118,273		111,338
				363,838		351,325			366,569		376,732
Total assets				472,574		478,130			436,464		449,125
Liabilities
Current liabilities
Suppliers and contractors				22,282		17,496			12,356		11,601
Loans, borrowings and leases		19		7,318		5,901			3,446		3,804
Other financial liabilities		11		8,472		9,906			7,185		4,747
Taxes payable				14,112		4,950			13,295		3,509
Settlement program ("REFIS")		7(c)		1,793		1,769			1,793		1,733
Liabilities related to associates and joint ventures		21		8,437		4,554			8,437		4,554
Provisions		22		6,400		9,711			4,423		4,819
Liabilities related to Brumadinho		20		12,709		9,925			12,709		9,925
De-characterization of dams		20		2,367		1,981			2,367		1,981
Dividends payable				193		6,342			177		6,342
Others				3,290		3,303			3,309		3,960
				87,373		75,838			69,497		56,975
Liabilities associated with non-current assets held for sale		12		69		-			-		-
				87,442		75,838			69,497		56,975
Non-current liabilities
Loans, borrowings and leases		19		66,578		72,187			15,256		21,646
Participative stockholders' debentures		18		22,452		17,737			22,452		17,737
Other financial liabilities		11		15,366		23,719			95,545		107,470
Settlement program ("REFIS")		7(c)		11,314		12,493			11,314		12,245
Deferred income taxes		7(a)		10,486		9,198			-		-
Provisions		22		39,566		43,829			14,117		13,016
Liabilities related to Brumadinho		20		10,988		13,849			10,988		13,849
De-characterization of dams		20		7,732		9,916			7,732		9,916
Liabilities related to associates and joint ventures		21		3,885		6,228			3,885		6,228
Streaming transactions				10,532		10,419			-		-
Others				766		1,731			4,382		4,258
				199,665		221,306			185,671		206,365
Total liabilities				287,107		297,144			255,168		263,340

Stockholders' equity		25
Equity attributable to Vale's stockholders				181,296		185,785			181,296		185,785
Equity attributable to non-controlling interests				4,171		(4,799	)		-		-
Total stockholders' equity				185,467		180,986			181,296		185,785
Total liabilities and stockholders' equity				472,574		478,130			436,464		449,125

The accompanying notes are an integral part of these interim financial statements.

Statement of Changes in Equity

In millions of Brazilian reais

	Share capital	Capital reserve	Profit reserves		Treasury shares		Other reserves		Cumulative translation adjustments		Retained earnings		Equity attributable to Vale’s stockholders		Equity attributable to non-controlling interests		Total stockholders' equity
Balance at December 31, 2020	77,300	3,634	36,598		(6,452	)	(7,307	)	82,012		-		185,785		(4,799	)	180,986
Net income (loss)	-	-	-		-		-		-		90,862		90,862		(267	)	90,595
Other comprehensive income	-	-	-		-		3,943		(5,909	)	-		(1,966	)	159		(1,807	)
Dividends and interest on capital of Vale's stockholders (note 25)	-	-	(22,935	)	-		-		-		(43,834	)	(66,769	)	-		(66,769	)
Dividends of non-controlling interest	-	-	-		-		-		-		-		-		(141	)	(141	)
Acquisition and disposal of non-controlling interest (note 12)	-	-	-		-		(1,666	)	-		-		(1,666	)	9,219		7,553
Share buyback program (note 25)	-	-	-		(25,261	)	-		-		-		(25,261	)	-		(25,261	)
Share-based payment (note 24)	-	-	-		-		274		-		-		274		-		274
Treasury shares utilized in the period (note 25)	-	-	-		37		-		-		-		37		-		37
Treasury shares cancellation (note 25)	-	-	-		6,347		-		-		(6,347	)	-		-		-
Balance at September 30, 2021	77,300	3,634	13,663		(25,329	)	(4,756	)	76,103		40,681		181,296		4,171		185,467

	Share capital	Capital reserve	Profit reserves		Treasury shares		Other reserves		Cumulative translation adjustments	Retained earnings	Equity attributable to Vale’s stockholders		Equity attributable to non-controlling interests		Total stockholders' equity
Balance at December 31, 2019	77,300	3,634	28,577		(6,520	)	(5,673	)	64,162	-	161,480		(4,331	)	157,149
Net income (loss)	-	-	-		-		-		-	21,888	21,888		(1,302	)	20,586
Other comprehensive income	-	-	-		-		(1,470	)	25,024	-	23,554		(1,674	)	21,880
Dividends and interest on capital of Vale's stockholders	-	-	(12,350	)	-		-		-	-	(12,350	)	-		(12,350	)
Dividends of non-controlling interest	-	-	-		-		-		-	-	-		(42	)	(42	)
Capitalization of non-controlling interest advances	-	-	-		-		-		-	-	-		71		71
Treasury shares utilized in the period (note 25)	-	-	-		68		-		-	-	68		-		68
Balance at September 30, 2020	77,300	3,634	16,227		(6,452	)	(7,143	)	89,186	21,888	194,640		(7,278	)	187,362

The accompanying notes are an integral part of these interim financial statements.

Value Added Statement

In millions of Brazilian Reais

	Consolidated						Parent company

	Nine-month period ended September 30,
	2021			2020			2021			2020
Generation of value added
Gross revenue
Revenue from products and services		226,085			130,618			180,645			84,263
Revenue from the construction of own assets		6,439			4,194			2,472			1,617
Other revenues		2,129			797			1,401			479
Less:
Cost of products, goods and services sold		(28,997	)		(19,050	)		(16,457	)		(9,806	)
Material, energy, third-party services and other		(32,316	)		(27,572	)		(10,342	)		(8,203	)
Impairment of non-current assets and others results		(15,700	)		(4,004	)		(335	)		(214	)
Brumadinho event		(2,437	)		(2,014	)		(2,437	)		(2,014	)
Other costs and expenses		(12,395	)		(11,253	)		(6,422	)		(6,965	)
Gross value added		142,808			71,716			148,525			59,157
Depreciation, amortization and depletion		(12,146	)		(12,174	)		(6,266	)		(5,984	)
Net value added		130,662			59,542			142,259			53,173

Received from third parties
Equity results from entities		(1,688	)		(3,763	)		(4,488	)		(307	)
Financial income		3,709			9,159			3,568			7,622
Total value added to be distributed		132,683			64,938			141,339			60,488

Personnel and charges		7,154			6,303			3,987			2,998
Taxes and contributions		29,768			8,257			33,548			7,478
Interest (net derivatives and monetary and exchange rate variation)		3,725			29,318			10,803			26,795
Other remunerations of third party funds		1,441			474			2,139			1,329
Dividends and interest on capital		-			12,350			-			12,350
Reinvested net income		90,862			9,538			90,862			9,538
Loss attributable to noncontrolling interest		(267	)		(1,302	)		-			-
Distributed value added		132,683			64,938			141,339			60,488

The accompanying notes are an integral part of these interim financial statements.

Selected Notes to the Interim Financial Statements

Expressed in millions of Brazilian reais, unless otherwise stated

1. Corporate information

Vale S.A. and its subsidiaries (“Vale” or the “Company”) are iron ore and iron ore pellets producers, which are key raw materials for steelmaking, and nickel producers, which is used to produce stainless steel and metal alloys employed in the production process of several products. The Company also produces copper, coking and thermal coal, manganese ore, platinum group metals, gold, silver and cobalt. The information by segment is presented in note 4.

Vale S.A. (the “Parent Company”) is a public company headquartered in the city of Rio de Janeiro, Brazil with securities traded on the stock exchanges of São Paulo – B3 S.A. (VALE3), New York - NYSE (VALE) and Madrid – LATIBEX (XVALO).

2. Basis of preparation of the interim financial statements

a) Statement of compliance

The consolidated and individual interim financial statements of the Company (“interim financial statements”) have been prepared and are being presented in accordance with IAS 34 Interim Financial Reporting (Technical pronouncement - CPC 21 (R1) Interim Financial Reporting) of the International Financial Reporting Standards (“IFRS”), as issued by the International Accounting Standards Board (“IASB”), as implemented in Brazil by the Brazilian Accountant Pronouncements Committee ("CPC"), approved by the Brazilian Securities Exchange Commission ("CVM") and by the Brazilian Federal Accounting Council (“CFC”). All relevant information from its own interim financial statements, and only this information, are being presented and correspond to those used by the Company's Management.

The presentation of the parent company and consolidated statements of value added is required by the Brazilian corporate legislation and the accounting practices adopted in Brazil for listed companies, while it is not required by IFRS. Therefore, under the IFRS, the presentation of such statements is considered supplementary information, and not part of the set of financial statements.

b) Basis of presentation

The interim financial statements have been prepared to update users about relevant events and transactions that occurred in the period and should be read in conjunction with the financial statements for the year ended December 31, 2020. The accounting policies, accounting estimates and judgements, risk management and measurement methods are the same as those applied when preparing the last annual financial statements, except for the change in the accounting practice for the share-based payment plans as disclosed in note 24.

The interim financial statements of the Company are measured using the currency of the primary economic environment in which the entity operates (“functional currency”), which in the case of the Parent Company is the Brazilian real (“R$”).

The exchange rates used by the Company to translate its foreign operations are as follows:

					Average rate
	Closing rate				Three-month period ended				Nine-month period ended
	September 30, 2021		December 31, 2020		September 30, 2021		September 30, 2020		September 30, 2021		September 30, 2020
United States dollar		5.4394		5.1967		5.2286		5.3772		5.3317		5.0793
Canadian dollar ("CAD")		4.2931		4.0771		4.1517		4.0366		4.2624		3.7505
Euro ("EUR")		6.2983		6.3779		6.1623		6.2876		6.3769		5.7207

These interim financial statements were authorized for issue by the Executive Committee on October 28, 2021.

3. Significant events in the current period

The financial position, cash flows and performance of the Company were particularly affected by the following events and transactions during the three-month period ended September 30, 2021:

Since the announcement of the Company’s divestiture intention in the coal segment, it started looking for a potential buyer to purchase the coal assets. Due to the negotiations carried out during the current quarter, the Company decided to impair those assets in full, resulting in a loss of R$12,165 (US$2,304 million) recognized in the income statement as "Impairment and disposal of non-current assets” for the three-month period ended September 30, 2021 (note 12).

Selected Notes to the Interim Financial Statements

Expressed in millions of Brazilian reais, unless otherwise stated

In September 2021, the Company approved and paid dividends of R$40,200 (US$7,391 million) to its shareholders (note 25).

In August 2021, production and maintenance employees of Sudbury, Canada, represented by United Steelworkers (“USW”) approved the new five-year collective bargaining agreement, that was previously rejected in June 2021 and led to the stoppage of the operation at that location. The agreement became effective immediately after its approval and the strike came to an end Due to the stoppage, the Company recorded expenses of R$265 (US$51 million) recognized as "Pre-operating and operational stoppage" for the three-month period ended September 30, 2021 (R$561 (US$110 million) for the nine-month period ended September 30, 2021).

In October 2021 (subsequent event), the Company approved the prepayment of the concession grant related to the Estrada de Ferro Carajás (“EFC”) and Estrada de Ferro Vitória Minas (“EFVM”) in the amount of R$1,871 (US$344 million) (note 11).

In October 2021 (subsequent event), the Superior Court of Justice issued a decision to exclude the Risoleta Neves hydroelectric plant out of the Energy Reallocation Mechanism. Therefore, the Company would be requested by the National Electric Energy Agency (“ANEEL”) and the Chamber of Electric Energy Commercialization (“CCEE”) to pay approximately R$392 (US$72 million), for which the Company has a provision as at September 30, 2021 (note 22).

In October 2021 (subsequent event), the Company approved a new share buyback program for its common shares, limited to a maximum of 200,000,000 common shares and their respective ADRs due to the upcoming conclusion of the current program in place as the cap number approved is close to being reached (note 25).

4. Information by business segment and by geographic area

The Company operates the following reportable segments: Ferrous Minerals, Base Metals and Coal. The segments are aligned with products and reflect the structure used by Management to evaluate Company’s performance. The responsible bodies for making operational decisions, allocating resources and evaluating performance ("chief operating decision maker" under IFRS 8 - Operating Segments) are the Executive Boards and the Board of Directors. Accordingly, the performance of the operating segments is assessed based on a measure of adjusted LAJIDA (EBITDA).

The Company allocates to “Others” the revenues and cost of other products, services, research and development, investments in joint ventures and associates of other business and unallocated corporate expenses. Additionally, the costs related to the Brumadinho event are not directly linked to the Company's operating activities and, therefore, are allocated to "Other" as well.

The Company has allocated the financial information of Vale Nouvelle-Calédonie SAS (“VNC”) operation to “Others” as this operation is no longer analyzed by the chief operating decision maker as part of to the performance of the Base Metals business segment due to the sale of this operation. The comparative periods were restated to reflect this change in the allocation criteria.

a) Adjusted LAJIDA (EBITDA)

The definition of Adjusted LAJIDA (EBITDA) for the Company is the operating income or loss plus dividends received and interest from associates and joint ventures, and excluding the amounts charged as (i) depreciation, depletion and amortization and (ii) impairment and disposal of non-current assets.

Selected Notes to the Interim Financial Statements

Expressed in millions of Brazilian reais, unless otherwise stated

	Consolidated
	Three-month period ended September 30, 2021
	Net operating revenue		Cost of goods sold and services rendered			Sales, administrative and other operating expenses			Research and evaluation			Pre operating and operational stoppage			Dividends received and interest from associates and joint ventures		Adjusted LAJIDA (EBITDA)
Ferrous minerals
Iron ore		44,560		(16,038	)		(162	)		(276	)		(317	)		-		27,767
Iron ore pellets		10,492		(3,197	)		(10	)		(5	)		(57	)		-		7,223
Ferroalloys and manganese		241		(171	)		4			(4	)		(20	)		-		50
Other ferrous products and services		489		(400	)		(1	)		(1	)		-			-		87
		55,782		(19,806	)		(169	)		(286	)		(394	)		-		35,127

Base metals
Nickel and other products		4,681		(4,092	)		311			(100	)		(268	)		-		532
Copper		3,549		(1,267	)		(30	)		(125	)		(5	)		-		2,122
		8,230		(5,359	)		281			(225	)		(273	)		-		2,654

Coal		1,843		(1,639	)		(27	)		(8	)		-			-		169

Others		406		(318	)		(736	)		(190	)		(6	)		24		(820	)
		66,261		(27,122	)		(651	)		(709	)		(673	)		24		37,130

Brumadinho event		-		-			(847	)		-			-			-		(847	)
COVID-19		-		-			(52	)		-			-			-		(52	)
Total		66,261		(27,122	)		(1,550	)		(709	)		(673	)		24		36,231

	Consolidated
	Three-month period ended September 30, 2020
	Net operating revenue		Cost of goods sold and services rendered			Sales, administrative and other operating expenses			Research and evaluation			Pre operating and operational stoppage			Dividends received and interest from associates and joint ventures		Adjusted LAJIDA (EBITDA)
Ferrous minerals
Iron ore		39,614		(11,110	)		(270	)		(164	)		(649	)		2		27,423
Iron ore pellets		6,416		(2,313	)		7			(8	)		(89	)		-		4,013
Ferroalloys and manganese		274		(233	)		(21	)		(1	)		(49	)		-		(30	)
Other ferrous products and services		436		(324	)		2			(1	)		-			8		121
		46,740		(13,980	)		(282	)		(174	)		(787	)		10		31,527

Base metals
Nickel and other products		6,543		(4,172	)		(119	)		(42	)		(1	)		-		2,209
Copper		3,156		(1,017	)		(13	)		(81	)		(1	)		-		2,044
		9,699		(5,189	)		(132	)		(123	)		(2	)		-		4,253

Coal		551		(1,726	)		(28	)		(47	)		-			110		(1,140	)

Others (i)		916		(1,095	)		(728	)		(220	)		(12	)		-		(1,139	)
		57,906		(21,990	)		(1,170	)		(564	)		(801	)		120		33,501

Brumadinho event		-		-			(613	)		-			-			-		(613	)
COVID-19		-		-			(76	)		-			-			-		(76	)
Total		57,906		(21,990	)		(1,859	)		(564	)		(801	)		120		32,812

(i) Includes the reclassification of the negative EBITDA of VNC in the amount of R$118.

Selected Notes to the Interim Financial Statements

Expressed in millions of Brazilian reais, unless otherwise stated

	Consolidated
	Nine-month period ended September 30, 2021
	Net operating revenue		Cost of goods sold and services rendered			Sales, administrative and other operating expenses			Research and evaluation			Pre operating and operational stoppage			Dividends received and interest from associates and joint ventures		Adjusted LAJIDA (EBITDA)
Ferrous minerals
Iron ore		158,876		(42,275	)		(609	)		(686	)		(1,215	)		-		114,091
Iron ore pellets		27,390		(8,044	)		159			(11	)		(194	)		114		19,414
Ferroalloys and manganese		763		(498	)		(6	)		(5	)		(64	)		-		190
Other ferrous products and services		1,541		(1,139	)		15			(6	)		-			-		411
		188,570		(51,956	)		(441	)		(708	)		(1,473	)		114		134,106

Base metals
Nickel and other products		20,472		(13,379	)		115			(257	)		(570	)		-		6,381
Copper		10,239		(3,390	)		(36	)		(332	)		(16	)		-		6,465
		30,711		(16,769	)		79			(589	)		(586	)		-		12,846

Coal		3,207		(5,180	)		(18	)		(29	)		-			424		(1,596	)

Others (i)		921		(1,195	)		(1,840	)		(675	)		(12	)		140		(2,661	)
		223,409		(75,100	)		(2,220	)		(2,001	)		(2,071	)		678		142,695

Brumadinho event		-		-			(2,437	)		-			-			-		(2,437	)
COVID-19		-		-			(145	)		-			-			-		(145	)
Total		223,409		(75,100	)		(4,802	)		(2,001	)		(2,071	)		678		140,113

(i) Includes the negative EBITDA of VNC in the amount of R$358.

	Consolidated
	Nine-month period ended September 30, 2020
	Net operating revenue		Cost of goods sold and services rendered			Sales, administrative and other operating expenses			Research and evaluation			Pre operating and operational stoppage			Dividends received and interest from associates and joint ventures		Adjusted LAJIDA (EBITDA)
Ferrous minerals
Iron ore		85,058		(28,001	)		(677	)		(402	)		(2,054	)		2		53,926
Iron ore pellets		15,098		(6,191	)		65			(17	)		(291	)		283		8,947
Ferroalloys and manganese		851		(682	)		(21	)		(6	)		(105	)		-		37
Other ferrous products and services		1,222		(939	)		10			(6	)		-			8		295
		102,229		(35,813	)		(623	)		(431	)		(2,450	)		293		63,205

Base metals
Nickel and other products		15,608		(9,494	)		(292	)		(149	)		(156	)		-		5,517
Copper		7,674		(2,940	)		(23	)		(237	)		(1	)		-		4,473
		23,282		(12,434	)		(315	)		(386	)		(157	)		-		9,990

Coal		1,734		(5,369	)		(6	)		(119	)		-			434		(3,326	)

Others (i)		2,346		(3,023	)		(2,333	)		(540	)		(38	)		126		(3,462	)
		129,591		(56,639	)		(3,277	)		(1,476	)		(2,645	)		853		66,407

Brumadinho event		-		-			(2,014	)		-			-			-		(2,014	)
COVID-19		-		-			(545	)		-			-			-		(545	)
Total		129,591		(56,639	)		(5,836	)		(1,476	)		(2,645	)		853		63,848

(i) Includes the reclassification of the negative EBITDA of VNC in the amount of R$587.

Adjusted LAJIDA (EBITDA) is reconciled to net income as follows:


Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

	Consolidated
	Three-month period ended September 30,						Nine-month period ended September 30,
	2021			2020			2021			2020
Net income attributable to Vale's stockholders		20,203			15,615			90,862			21,888
Net income (loss) attributable to non-controlling interests		371			(543	)		(267	)		(1,302	)
Net income		20,574			15,072			90,595			20,586
Depreciation, depletion and amortization		3,657			4,162			12,146			12,174
Income taxes		(1,915	)		4,259			19,053			2,011
Financial results		1,939			7,380			253			20,457
LAJIDA (EBITDA)		24,255			30,873			122,047			55,228

Items to reconciled adjusted LAJIDA (EBITDA)
Equity results and other results in associates and joint ventures		(670	)		211			1,688			3,763
Dividends received and interest from associates and joint ventures (i)		24			120			678			853
Impairment and disposal of non-current assets		12,622			1,608			15,700			4,004
Adjusted LAJIDA (EBITDA)		36,231			32,812			140,113			63,848

(i) Includes the remuneration of the financial instrument of the Coal segment.

b) Assets by segment

	Consolidated
	September 30, 2021						December 31, 2020
	Product inventory		Investments in associates and joint ventures		Property, plant and equipment and intangibles (i)		Product inventory		Investments in associates and joint ventures		Property, plant and equipment and intangibles (i)
Ferrous minerals		15,294		6,556		156,030		10,483		5,995		152,970
Base metals		7,006		91		107,134		6,398		91		101,593
Coal (note 12)		460		-		-		129		-		-
Others		-		4,771		8,811		-		4,471		7,582
Total		22,760		11,418		271,975		17,010		10,557		262,145

	Consolidated
	Three-month period ended September 30,
	2021						2020
	Capital expenditures (ii)						Capital expenditures (ii)
	Sustaining capital		Project execution		Depreciation, depletion and amortization		Sustaining capital		Project execution		Depreciation, depletion and amortization
Ferrous minerals		3,073		714		2,150		2,160		198		2,160
Base metals		1,696		591		1,185		1,658		378		1,884
Coal (note 12)		257		-		264		146		-		-
Others (iii)		6		189		58		150		3		118
Total		5,032		1,494		3,657		4,114		579		4,162

	Consolidated
	Nine-month period ended September 30,
	2021						2020
	Capital expenditures (ii)						Capital expenditures (ii)
	Sustaining capital		Project execution		Depreciation, depletion and amortization		Sustaining capital		Project execution		Depreciation, depletion and amortization
Ferrous minerals		8,807		1,750		6,734		7,136		919		6,620
Base metals		5,188		1,329		4,857		4,596		951		5,099
Coal (note 12)		607		-		350		659		-		83
Others (iii)		70		348		205		607		25		372
Total		14,672		3,427		12,146		12,998		1,895		12,174

(i) Goodwill is allocated to ferrous minerals and base metals segments in the amount of R$7,133 and R$10,533 in September 30, 2021 and R$7,133 and R$10,008 in December 31, 2020, respectively.

(ii) Cash outflows.

(iii) Includes the reclassification of VNC under the captions “Sustaining capital” and “depreciation, depletion and amortization”, in the amount of R$144 and R$48, respectively, for the three-month period ended on September 30, 2020 and in the amount of R$591 and R$171, respectively, for the nine-month period ended on September 30, 2020.


Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

c) Net operating revenue by geographic area

	Consolidated
	Three-month period ended September 30, 2021
	Ferrous minerals		Base metals		Coal			Others		Total
Americas, except USA and Brazil		1,192		415		-			-		1,607
United States of America		370		1,432		-			-		1,802
Germany		916		908		-			-		1,824
Europe, except Germany		2,862		2,253		115			-		5,230
Middle East, Africa and Oceania		2,885		21		191			-		3,097
Japan		6,752		749		77			-		7,578
China		27,994		1,257		376			-		29,627
Asia, except Japan and China		4,990		1,156		1,096			-		7,242
Brazil		7,821		39		(12	)		406		8,254
Net operating revenue		55,782		8,230		1,843			406		66,261

	Consolidated
	Three-month period ended September 30, 2020
	Ferrous minerals		Base metals		Coal		Others (i)		Total
Americas, except USA and Brazil		607		194		-		529		1,330
United States of America		546		950		-		-		1,496
Germany		231		1,617		-		-		1,848
Europe, except Germany		1,466		3,621		65		-		5,152
Middle East, Africa and Oceania		2,152		17		65		-		2,234
Japan		2,499		504		-		-		3,003
China		33,037		1,506		-		-		34,543
Asia, except Japan and China		2,926		1,134		382		-		4,442
Brazil		3,276		156		39		387		3,858
Net operating revenue		46,740		9,699		551		916		57,906

(i) Includes the reclassification of VNC in the amount of R$529.

	Consolidated
	Nine-month period ended September 30, 2021
	Ferrous minerals		Base metals		Coal		Others (i)		Total
Americas, except USA and Brazil		3,698		1,629		-		21		5,348
United States of America		1,762		4,515		-		-		6,277
Germany		2,669		5,926		-		-		8,595
Europe, except Germany		11,314		9,218		245		-		20,777
Middle East, Africa and Oceania		7,926		62		398		-		8,386
Japan		14,655		1,904		180		-		16,739
China		110,663		3,526		700		-		114,889
Asia, except Japan and China		14,468		3,693		1,684		-		19,845
Brazil		21,415		238		-		900		22,553
Net operating revenue		188,570		30,711		3,207		921		223,409

(i) Includes the revenue of VNC in the amount of R$21.

	Consolidated
	Nine-month period ended September 30, 2020
	Ferrous minerals		Base metals		Coal		Others (i)		Total
Americas, except USA and Brazil		1,136		645		-		1,225		3,006
United States of America		903		2,844		-		-		3,747
Germany		1,416		3,990		-		-		5,406
Europe, except Germany		3,947		7,597		462		-		12,006
Middle East, Africa and Oceania		4,745		79		308		-		5,132
Japan		5,747		1,504		56		-		7,307
China		69,168		2,900		75		-		72,143
Asia, except Japan and China		6,997		3,164		771		-		10,932
Brazil		8,170		559		62		1,121		9,912
Net operating revenue		102,229		23,282		1,734		2,346		129,591

(i) Includes the reclassification of VNC in the amount of R$1,225.



Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

Provisionally priced commodities sales – The commodity price risk arises from volatility of iron ore, nickel, copper and coal prices. The Company is mostly exposed to the fluctuations in the iron ore and copper price (note 16). The selling price of these products can be measured reliably at each period, since the price is quoted in an active market.

The sensitivity of the Company’s risk on final settlement of provisionally priced accounts receivables is presented below:

	September 30, 2021
	Thousand metric tons		Provisional price (US$/tonne)		Change			Effect on Revenue
Iron ore		21,772		100.2		+/-10	%		1,141
Iron ore pellets		407		167.2		+/-10	%		36
Copper		104		10,981.8		+/-10	%		598

5. Costs and expenses by nature

a) Cost of goods sold and services rendered

	Consolidated
	Three-month period ended September 30,				Nine-month period ended September 30,
	2021		2020		2021		2020
Personnel		2,055		2,221		6,539		6,025
Materials and services		4,209		4,351		12,386		12,022
Fuel oil and gas		1,500		1,167		4,050		3,531
Maintenance		4,237		3,703		12,012		10,021
Royalties		2,092		1,144		5,320		2,768
Energy		902		948		2,613		2,584
Ores acquired from third parties (i)		3,312		1,494		8,823		2,829
Depreciation, depletion and amortization		3,411		3,903		11,405		11,136
Freight (ii)		6,159		5,018		15,647		11,842
Others		2,656		1,944		7,710		5,017
Total		30,533		25,893		86,505		67,775

Cost of goods sold		29,701		25,140		84,187		65,632
Cost of services rendered		832		753		2,318		2,143
Total		30,533		25,893		86,505		67,775

(i) The increase in “Ores acquired from third parties” is mainly due to the significant increase in the reference price of iron ore compared to 2020.

(ii) The increase in "Freight" is mainly due to the significant increase in volumes of CFR sales and higher international freight prices reference price and the effect of the devaluation of the R$ against the US$, considering that this cost is totally denominated in US$.

Tax on mineral production (Taxa de Fiscalização de Recursos Minerais - “TFRM”) – Several Brazilian states, including Minas Gerais, Pará and Mato Grosso do Sul, charge a TFRM, which is currently assessed at rates ranging from R$0.50 to R$3.72 per metric ton of minerals produced in or transferred from the state. The expenses related to the TFRM are presented in these interim financial statements under “Royalties”. In March 2021, a state decree increased the TFRM rate in the state of Para to R$11.19 per metric ton, effective in April 2021. According to the prior rule, which would expire in 2031, the TFRM rate was R$3.72 per ton until the production of 10 million metric tons and R$0.74 for volumes over than 10 million metric tons. The Company did not apply this increase in the current period based on the Brazilian constitutional principle of mandatory notice period, which sets out the tax increase would become in force only in the subsequent year of its enactment and does not expect any impact for the year ending December 31, 2021. The Company is also evaluating other legal aspects to avoid this increase in the future.

b) Selling and administrative expenses

	Consolidated
	Three-month period ended September 30,				Nine-month period ended September 30,
	2021		2020		2021		2020
Selling		132		110		362		293
Personnel		150		271		689		695
Services		149		151		361		405
Depreciation and amortization		61		50		162		203
Others		111		102		315		268
Total		603		684		1,889		1,864



Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

c) Other operating expenses (income), net

	Consolidated
	Three-month period ended September 30,					Nine-month period ended September 30,
	2021			2020		2021			2020
Provision for litigations		122			55		356			381
Profit sharing program		155			184		558			402
COVID-19 expenses		52			76		145			545
Others (i)		(167	)		297		(421	)		833
Total		162			612		638			2,161

(i) Includes the gain related to the exclusion of ICMS from the PIS and COFINS computation tax base, as detailed in note 23(e).

6. Financial result

	Consolidated
	Three-month period ended September 30,						Nine-month period ended September 30,
	2021			2020			2021			2020
Financial income
Short-term investments		368			138			731			517
Others (i)		107			232			600			1,059
		475			370			1,331			1,576
Financial expenses
Loans and borrowings gross interest (note 19)		(819	)		(1,119	)		(2,887	)		(3,110	)
Capitalized loans and borrowing costs		75			67			235			274
Participative stockholders' debentures (note 18)		825			(3,002	)		(5,886	)		(4,341	)
Interest on REFIS		(87	)		(50	)		(180	)		(228	)
Interest on lease liabilities (note 19)		(85	)		(90	)		(273	)		(261	)
Financial guarantees (ii)		(180	)		(1,905	)		1,636			(2,771	)
Expenses with cash tender offer redemption (note 19)		-			-			(354	)		-
Others		(407	)		(472	)		(1,469	)		(1,556	)
		(678	)		(6,571	)		(9,178	)		(11,993	)
Other financial items, net
Net foreign exchange gains (losses)		1,883			(80	)		1,572			(1,822	)
Derivative financial instruments (note 16)		(2,393	)		(1,051	)		(263	)		(7,866	)
Reclassification of cumulative translation adjustment (note 12)		48			-			6,439			-
Indexation gains (losses), net		(1,274	)		(48	)		(154	)		(352	)
		(1,736	)		(1,179	)		7,594			(10,040	)
Total		(1,939	)		(7,380	)		(253	)		(20,457	)

(i) During nine-month period ended on September 30, 2020, includes amounts related to Eletrobras contingent assets in the amount of R$301, due to differences of monetary adjustments and interests due over to the third convertible bonds.
(ii) Refers to the fair value adjustments on financial guarantees given to associates due to their rating improvement, leading to a decrease in the probability of default on the guaranteed loans. Further details are disclosed in note 13 and 17.

7. Income taxes

a) Deferred income tax assets and liabilities

	Consolidated
	Assets			Liabilities			Deferred taxes, net
Balance at December 31, 2020		53,711			9,198			44,513
Effect in income statement		8,252			(104	)		8,356
Transfers between asset and liabilities		34			34			-
Translation adjustment		709			369			340
Other comprehensive income		(686	)		989			(1,675	)
Balance at September 30, 2021		62,020			10,486			51,534

		Consolidated
		Assets			Liabilities			Deferred taxes, net
Balance at December 31, 2019		37,151			7,585			29,566
Effect in income statement		4,931			(410	)		5,341
Translation adjustment		3,178			2,395			783
Other comprehensive income		8,950			(350	)		9,300
Balance at September 30, 2020		54,210			9,220			44,990



Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

b) Income tax reconciliation – Income statement

Income tax expense is recognized based on the estimate of the weighted average effective tax rate expected for the full year, adjusted for the tax effect of certain items that are recognized in full on the interim tax calculation. Therefore, the effective tax rate in the interim financial statements may differ from management’s estimate of the effective tax rate for the year.

The total amount presented as income taxes in the income statement is reconciled to the statutory rate, as follows:

	Consolidated
	Three-month period ended September 30,						Nine-month period ended September 30,
	2021			2020			2021			2020
Income before income taxes		18,659			19,331			109,648			22,597
Income taxes at statutory rate - 34%		(6,344	)		(6,573	)		(37,280	)		(7,683	)
Adjustments that affect the basis of taxes:
Tax incentives		5,067			2,642			13,715			4,991
Equity results		358			(10	)		490			(110	)
Addition(reversal) of tax loss carryforward		570			596			(4	)		2,555
Others		2,264			(914	)		4,026			(1,764	)
Income taxes		1,915			(4,259	)		(19,053	)		(2,011	)

c) Income taxes - Settlement program (“REFIS”)

	September 30, 2021		December 31, 2020
Current liabilities		1,793		1,769
Non-current liabilities		11,314		12,493
REFIS liabilities		13,107		14,262

SELIC rate		6.25% per year		2.00% per year

The balance mainly relates to the settlement program of the claims related to the collection of income tax and social contribution on equity gains of foreign subsidiaries and affiliates from 2003 to 2012. As at September 30, 2021, the balance is due in 85 remaining monthly installments, bearing the SELIC interest rate (Special System for Settlement and Custody), which is the Brazilian federal funds rate.

d) Uncertain tax positions

In September 2021, in the judgement of the leading case (RE 1.063.187), the Brazilian Federal Supreme Court (“STF”) ruled that is unconstitutional to include the gain related to the monetary adjustments, calculated based on the SELIC (Special System for Settlement and Custody), over certain tax credits on the computation of the Corporate Income Tax ("IRPJ") and Social Contribution on Net Income ("CSLL"). Despite the favorable conclusion to taxpayers, the decision is not yet final, as the publication of the decision is pending and may be appealed.

Vale filed a lawsuit to discuss the matter and is awaiting for the publication of the STF decision to assess the potential effects on the eventual gain involved, which is estimated at US$35 (R$190 million). Considering that the decision is not even published, the Company's external legal advisors consider a gain is not yet probable. Therefore, the Company did not record any gain in these interim financial statements.

Basic and diluted earnings per share

The basic and diluted earnings per share are presented below:

	Three-month period ended September 30,				Nine-month period ended September 30,
	2021		2020		2021		2020
Net income attributable to Vale's stockholders:
Net income		20,203		15,615		90,862		21,888

Thousands of shares
Weighted average number of common shares outstanding		5,080,890		5,129,911		5,065,750		5,129,475

Basic and diluted earnings per share:
Common share (R$)		3.98		3.04		17.94		4.27


Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

The Company does not have potential outstanding shares or other instruments with dilutive effect on the earnings per share computation.

Accounts receivable

	Consolidated
	September 30, 2021			December 31, 2020
Accounts receivable		5,004			26,205
Expected credit loss		(257	)		(261	)
		4,747			25,944

Revenue related to the steel sector		89.66	%		87.25	%

	Consolidated
	Three-month period ended September 30,				Nine-month period ended September 30,
	2021		2020		2021		2020
Impairment of accounts receivable recorded in the income statement		7		5		20		46

The decrease in the accounts receivable is mainly due to the reduction in average prices and volumes of provisional sales of iron ore.

As at September 30, 2021, there is no customer that individually represents more than 10% of the Company’s accounts receivable or revenues. In 2020, the Company had a customer of the Ferrous Minerals Segment whose revenue individually represented 10.1% of the Company’s total revenue.

10.

Inventories

	Consolidated
	September 30, 2021		December 31, 2020
Finished products		18,459		13,659
Work in progress		4,301		3,351
Consumable inventory		4,899		4,093
Total		27,659		21,103

	Consolidated
	Three-month period ended September 30,				Nine-month period ended September 30,
	2021		2020		2021		2020
Reversal for net realizable value		153		236		156		15

Finished and work in progress products inventories by segments are presented in note 4(b) and the cost of goods sold is presented in note 5(a).


Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

11. Other financial assets and liabilities

	Consolidated
	Current				Non-Current
	September 30, 2021		December 31, 2020		September 30, 2021		December 31, 2020
Other financial assets
Restricted cash		-		-		659		197
Derivative financial instruments (note 16)		790		698		191		347
Investments in equity securities		6,640		-		33		3,936
Related parties (i)		-		1,009		-		4,791
		7,430		1,707		883		9,271
Other financial liabilities
Derivative financial instruments (note 16)		1,816		1,712		3,428		3,578
Related parties (i)		721		3,759		-		4,655
Financial guarantees provided (note 13 and 17)		-		-		2,926		4,558
Liabilities related to the concession grant (note 14)		2,130		1,088		9,012		10,928
Advances received		3,805		3,347		-		-
		8,472		9,906		15,366		23,719

(i) The decrease refers to the settlement of the loans due to the transaction for the acquisition of NLC, as detailed in note 12.

Investment in equity securities – Mainly refers to 34.2 million common shares of The Mosaic Company (“Mosaic”), which is accounted for as a financial instrument measured at fair value through other comprehensive income. The fair value of this instrument is measured using the Mosaic’s share price at the end of each financial reporting period. In addition, the Company holds an investment of R$33 (US$6 million) made in February 2021 to acquire a non-controlling interest of 3.24% in Boston Electrometallurgical Company, aiming to promote the development of a technology focused on the reduction of carbon dioxide on the steel production.

Liabilities related to the concession grant - On October 28, 2021 (subsequent event), the Board of Directors approved the prepayment in the amount of R$1,871 (US$344 million) of the concessions grant. With the prepayment, the liability will be remeasured and the outstanding balance is estimated to be R$973 (US$179 million).


Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

12.

Acquisitions and divestitures

Business Combinations

The Company has coking and thermal coal mining and processing operations in Mozambique. Vale Moçambique S.A. (“Vale Moçambique”) is a company controlled by Vale, with a non-controlling interest held by Mitsui & Co. Ltd. (“Mitsui”) until the acquisition completed on June 22, 2021, as detailed below in (a.i). Coal products are transported from the Moatize mine to the maritime terminal by the Nacala Logistics Corridor (“NLC”), which were a joint venture between Vale and Mitsui. The NLC’s main assets are the railways and port concessions located in Mozambique and Malawi.

(a.i) Acquisition of non-controlling interest in Vale Moçambique

On June 22, 2021, the Company acquired the 15% interest held by Mitsui in Vale Moçambique for an immaterial consideration, which resulted in a loss of R$1,666 (US$331 million) due to the negative reserves of Vale Moçambique at the conclusion of the transaction. This transaction with non-controlling interests was recognized in the Stockholders’ Equity for the period ended June 30,2021 as “Acquisition and disposal of non-controlling interest”. After the acquisition of the interests previously held by Mitsui, the Company holds 95% of the share capital of Vale Moçambique, and the remaining interest is held by the government of Mozambique.

(a.ii) Business combinations - NLC

Also on June 22, 2021, the acquisition was concluded with the settlement of NLC’s loans with third parties (“Project Finance”) in the amount of R$12,665 (US$2,517 million), satisfying all conditions to acquire the additional 50% held by Mitsui. Therefore, the Company started consolidating the NLC’s assets and liabilities on its balance sheet.

In addition, the Company has updated the discounted cash flow model to assess the fair value of the acquired business, resulting in a loss of R$3,880 (US$771 million) (R$4,015 (US$798 million) as at December 31, 2020) on the fair value of the loans receivable from NLC, mainly due to the decrease in the long-term price assumption for both coking and thermal coal as well as the reduction in the expected production to reflect the operational challenges to reach the ramp-up of the coal business, after the revamp of the processing plants. The cash flows were discounted at a rate of 11.6%, and the loss was recognized as “Impairment and disposals of non-current assets” for the period ended June 30, 2021.

The fair values of identifiable assets acquired and liabilities assumed as a result of the NLC’s acquisition were as follows:

	June 22, 2021
Acquired assets
Cash and cash equivalents		865
Inventory, recoverable tax and other assets		2,128
Intangible		11,166
Property, plant and equipment		6,858
Assumed liabilities		(795	)
Net identifiable assets acquired		20,223
Fair value adjustments (i)		(8,001	)
Total identifiable net assets at fair value (ii)		12,222

Pre-existing relationship (Loans receivable from NLC)		4,322
Loss on pre-existing relationship		(3,880	)
		12,665

Cash consideration		12,665
(-) Balances acquired
Cash and cash equivalents		865
Net cash outflow		11,800


Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

(i) Of this amount, R$2,218 was allocated to property, plant and equipment and R$3,978 was allocated to intangible and the remaining amount was allocated to other assets.

(ii) The fair value was assessed using the fair value less costs of disposal model, through discounted cash flow techniques, which is classified as “level 3” in the fair value hierarchy. The cash flows were discounted by using a post-tax discount rate expressed in real terms, which represents an estimate of the rate that a market participant would apply having regard to the time value of money and the asset’s specific risk.

(a.iii) Fair value adjustments

On the announcement of the Investment Agreement with Mitsui, the Company has also informed the market its divestiture intention in the coal segment. Since then, interactions during the current quarter with potential interested parties in acquiring the Company’s coal assets have led management to decide to fully impair those assets, resulting in the recognition of an impairment loss of R$12,165 (US$2,304 million) in the income statement as "Impairment and disposal of non-current assets” for the period ended September 30, 2021. Therefore, in the event of a potential sale, the Company will recognize a gain of approximately R$10,080 (US$1,910 million) related to the accumulated translation adjustments on the disposal.

Additionally, due to the current stage of the sale process, the coal segment does not yet meet the “highly probable” definition under IFRS 5 - Non-Current Assets Held for Sale and Discontinued Operations to quality as held for sale as at September 30, 2021. Therefore, the Company will continue assessing the criteria at each period for financial reporting purposes.

Furthermore, the Company concluded that its Australian subsidiaries (part of the coal segment), which are no longer operational, were considered "abandoned" under IAS 21 - The Effects of Changes in Foreign Exchange Rates and, therefore, the Company recognized a gain related to the accumulated translation adjustments in the amount of R$2,134 (US$424 million), which was reclassified to net income as “Impairment and disposals of non-current assets” for the period ended June 30, 2021.

Other acquisitions and divestitures

Vale Nouvelle-Calédonie S.A.S. (“VNC”) – In December 2020, the Company signed a binding put option agreement to sell its interest in VNC for an immaterial consideration to Prony Resources, a consortium constituted and led by the current management and employees of VNC supported by the Caledonian and French authorities with Trafigura Pte. Ltd. as a non-controlling shareholder. Under the terms of agreement, the Company has assumed an obligation to pay to the buyers an amount of R$2,573 (US$500 million) upon closing of the transaction and this amount has been provided for as at December 31, 2020.

In March 2021, the Company signed the share purchase and sale agreement with Prony Resources, concluding the transaction to sell its interest in VNC. With the final agreement, Vale's obligation to pay to buyers increased by R$302 (US$55 million), which combined with other working capital adjustments, resulted in an additional loss of R$549 (US$98 million), recorded as “Impairment and disposals of non-current assets”. On March 31, 2021, the Company disbursed R$3,134 (US$555 million) to VNC on the closing of the transaction.

The agreement also established that Vale has an offtake agreement to purchase a certain amount of VNC’s annual nickel production with a cap price over a period of 13 years. Such cap included in contract is an embedded derivative, however, it is deemed closely related to the host contract (nickel supply agreement) because the cap was out of the money on inception of the contract. Therefore, this derivative will not be separated from the host contract, which will be accounted for as an executory contract.

Upon closing of the transaction, the Company also recognized a gain of R$6,391 (US$1,132 million) arising from the accumulated exchange differences reclassified from the stockholders’ equity to the income statement under “Other financial items, net”.

Manganese ferroalloys operations classified as non-current assets and liabilities held for sale – In September 2021, the Company signed an agreement to sell its assets and liabilities located in the state of Minas Gerais, which are part of Vale Manganês S.A. and relates to the manganese ferroalloys business, for R$218 (US$40 million). Due to that agreement, those assets and liabilities were classified as "held for sale" and measured at fair value less costs of disposal, resulting in the recognition of an impairment loss of R$98 (US$18 million) recognized in the income statement as "Impairment and disposal of non-current assets” for the three-month period ended September 30, 2021. The completion of the transaction is subject to review of the Brazilian Administrative Council for Economic Defense ("CADE") and is expected to occur within the next 12 months. Those assets and liabilities were classified as non-current held for sale as follows:


Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

	September 30, 2021
Assets
Accounts receivable		117
Inventories		59
Recoverable taxes		91
Other current asset		1
Property, plant and equipment		58
Non-current assets held for sale		326

Liabilities
Suppliers and contractors		43
Provisions		26
Non-current liabilities held for sale		69

Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

13. Investments in associates and joint ventures

a) Investment information

									Equity results in the income statement												Consolidated Dividends received
					Investments in associates and joint ventures				Three-month period ended September 30,						Nine-month period ended September 30,						Three-month period ended September 30,				Nine-month period ended September 30,
	% ownership		% voting capital		September 30, 2021		December 31, 2020		2021			2020			2021			2020			2021		2020		2021		2020
Associates and joint ventures
Ferrous minerals
Baovale Mineração S.A.		50.00		50.00		122		103		5			5			19			16			-		2		-		2
Companhia Coreano-Brasileira de Pelotização		50.00		50.00		383		249		77			11			161			36			-		-		9		89
Companhia Hispano-Brasileira de Pelotização (i)		50.89		50.89		210		223		3			25			4			41			-		-		35		72
Companhia Ítalo-Brasileira de Pelotização (i)		50.90		51.00		376		228		86			(2	)		153			49			-		-		30		119
Companhia Nipo-Brasileira de Pelotização (i)		51.00		51.11		755		627		81			-			147			40			-		-		40		-
MRS Logística S.A.		48.16		46.75		2,382		2,069		171			65			362			133			-		-		-		-
VLI S.A.		29.60		29.60		2,328		2,495		(121	)		(3	)		(168	)		(95	)		-		8		-		8
						6,556		5,994		302			101			678			220			-		10		114		290
Base metals
Korea Nickel Corp.		25.00		25.00		91		91		1			(3	)		2			(2	)		-		-		-		-
						91		91		1			(3	)		2			(2	)		-		-		-		-
Others
Aliança Geração de Energia S.A. (i)		55.00		55.00		2,076		1,909		216			27			307			111			24		-		140		126
Aliança Norte Energia Participações S.A. (i)		51.00		51.00		591		606		1			(9	)		(16	)		(24	)		-		-		-		-
California Steel Industries, Inc.		50.00		50.00		1,718		1,218		547			(44	)		870			(46	)		-		-		-		-
Companhia Siderúrgica do Pecém ("CSP") (ii)		50.00		50.00		-		-		-			-			(237	)		(364	)		-		-		-		-
Mineração Rio do Norte S.A.		40.00		40.00		-		367		(14	)		27			(29	)		(28	)		-		-		-		-
Others						386		372		(11	)		(129	)		(145	)		(190	)		-		-		-		3
						4,771		4,472		739			(128	)		750			(541	)		24		-		140		129
Total						11,418		10,557		1,042			(30	)		1,430			(323	)		24		10		254		419



Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

(i) Although the Company held a majority of the voting capital, the entities are accounted under the equity method due to the stockholders' agreement where relevant decisions are shared with other parties.

(ii) CSP is a joint venture and its results are accounted for under the equity method, in which the accumulated losses are capped to the Company ́s interest in the investee’s capital based on the applicable law and requirements. That is, after the investment is reduced to zero, the Company does not recognize further losses nor liabilities associated with the investee.

(iii) “Equity results and other results in associates and joint ventures” presented in the Income Statement considers, in addition to the equity results in associates and joint ventures shown in the table above, the results of Renova Foundation and Samarco (note 21) and other results with group entities.

b) Movements during the period

	Consolidated
	2021			2020
Balance at January 1,		10,557			11,278
Capital contribution to CSP		237			366
Translation adjustment		76			484
Equity results in income statement		1,430			(323	)
Equity results in statement of comprehensive income		2			(9	)
Impairment of Mineração Rio do Norte S.A.		(338	)		-
Dividends declared		(701	)		(507	)
Others		155			193
Balance at September 30,		11,418			11,482

The investments by segments are presented in note 4(b).

c) Financial guarantees provided

As at September 30, 2021 and December 31, 2020, the notional value of corporate financial guarantees provided by the Company (within the limit of its direct or indirect interest) for certain associates and joint ventures were R$8,213 (US$1,510 million) and R$8,091 (US$1,557 million), respectively. The fair value of these financial guarantees is shown in note 17.

14. Intangible

Movements during the period

	Consolidated
	Goodwill		Concessions			Contract right		Software			Research and development project and patents		Total
Balance at December 31, 2020		17,141		28,015			-		396			2,757		48,309
Additions		-		642			-		118			-		760
Disposals		-		(23	)		-		-			-		(23	)
Amortization		-		(994	)		-		(124	)		-		(1,118	)
Acquisition of NLC (note 12)		-		7,188			-		-			-		7,188
Impairment (i)		-		(7,510	)		-		-			-		(7,510	)
Translation adjustment		525		345			-		7			-		877
Balance at September 30, 2021		17,666		27,663			-		397			2,757		48,483
Cost		17,666		40,717			-		4,030			2,757		65,170
Accumulated amortization		-		(13,054	)		-		(3,633	)		-		(16,687	)
Balance at September 30, 2021		17,666		27,663			-		397			2,757		48,483

	Consolidated
	Goodwill		Concessions			Contract right			Software			Research and development project and patents			Total
Balance at December 31, 2019		14,628		16,005			563			304			2,757			34,257
Additions		-		629			-			62						691
Disposals		-		(25	)		-			(1	)		-			(26	)
Amortization		-		(683	)		(4	)		(84	)		-			(771	)
Translation adjustment		2,935		-			171			51			(1	)		3,156
Balance at September 30, 2020		17,563		15,926			730			332			2,756			37,307
Cost		17,563		20,969			1,274			3,965			2,756			46,527
Accumulated amortization		-		(5,043	)		(544	)		(3,633	)		-			(9,220	)
Balance at September 30, 2020		17,563		15,926			730			332			2,756			37,307

(i) In the current year, the Company recognized an impairment loss related to coal assets incorporated in the acquisition of NLC in the amount of R$ 7,510 (note 12).



Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

15. Property, plant and equipment

a) Movements during the period

	Consolidated
	Building and land			Facilities			Equipment			Mineral properties			Railway equipment			Right of use assets			Others			Constructions in progress			Total
Balance at December 31, 2020		44,646			39,448			25,637			41,853			13,108			8,121			12,968			28,055			213,836
Additions (i)		-			-			-			-			-			292			-			18,624			18,916
Disposals		(18	)		(138	)		(315	)		-			(25	)		-			(5	)		(239	)		(740	)
Asset retirement obligation (ii)		-			-			-			(2,508	)		-			-			-			-			(2,508	)
Depreciation, depletion and amortization		(1,774	)		(1,923	)		(2,632	)		(1,713	)		(687	)		(700	)		(1,053	)		-			(10,482	)
Acquisition of NLC (note 12)		1,185			663			515			-			1,640			167			10			460			4,640
Impairment (iii)		(1,220	)		(604	)		(451	)		-			(1,653	)		(172	)		(10	)		(1,240	)		(5,350	)
Translation adjustment		717			432			849			1,635			52			297			265			991			5,238
Transfers		1,194			1,959			2,750			1,144			447			-			1,133			(8,627	)		-
Transfer to net assets held for sale (note 12)		(16	)		(12	)		(17	)		(8	)		-			-			(5	)		-			(58	)
Balance at September 30, 2021		44,714			39,825			26,336			40,403			12,882			8,005			13,303			38,024			223,492
Cost		82,728			65,479			59,271			90,692			20,379			10,593			29,717			38,024			396,883
Accumulated depreciation		(38,014	)		(25,654	)		(32,935	)		(50,289	)		(7,497	)		(2,588	)		(16,414	)		-			(173,391	)
Balance at September 30, 2021		44,714			39,825			26,336			40,403			12,882			8,005			13,303			38,024			223,492

	Consolidated
	Building and land			Facilities			Equipment			Mineral properties			Railway equipment			Right of use assets			Others			Constructions in progress			Total
Balance at December 31, 2019		43,137			38,713			22,921			33,302			13,064			6,819			12,137			17,640			187,733
Additions (i)		-			-			-			-			-			196			-			14,107			14,303
Disposals		(35	)		(194	)		(8	)		(38	)		(26	)		-			(21	)		(161	)		(483	)
Asset retirement obligation		-			-			-			1,912			-			-			-			-			1,912
Depreciation, depletion and amortization		(1,677	)		(1,879	)		(2,802	)		(1,839	)		(699	)		(671	)		(1,084	)		-			(10,651	)
Impairment		(816	)		(1,653	)		(78	)		(785	)		-			(3	)		(439	)		(800	)		(4,574	)
Translation adjustment		4,378			2,939			4,704			8,279			348			2,072			1,538			1,782			26,040
Transfers		937			1,709			1,772			1,769			276			-			988			(7,451	)		-
Balance at September 30, 2020		45,924			39,635			26,509			42,600			12,963			8,413			13,119			25,117			214,280
Cost		80,411			60,690			57,356			90,981			19,678			10,392			31,088			25,117			375,713
Accumulated depreciation		(34,487	)		(21,055	)		(30,847	)		(48,381	)		(6,715	)		(1,979	)		(17,969	)		-			(161,433	)
Balance at September 30, 2020		45,924			39,635			26,509			42,600			12,963			8,413			13,119			25,117			214,280

(i) Includes capitalized borrowing costs.

(ii) Refers to changes in discount rates.

(iii) Due to the Company's assessment of the fair value of the coal assets, the assets acquired during the year are provided for impairment in full, resulting in a loss of R$124 and R$597 for the three and nine-month periods ended September 30, 2021 (R$173 and R$546 for the three and nine-month periods ended September 30, 2020). In the current year, the Company also recognized an impairment loss related to NLC assets in the amount of R$4,655 (note 12).

b) Right-of-use assets (Leases)

	December 31, 2020		Additions and contract modifications		Impairment (ii)			Depreciation			Translation adjustment		September 30, 2021
Ports		3,732		-		-			(181	)		144		3,695
Vessels		2,779		-		-			(172	)		127		2,734
Pellets plants		683		200		-			(147	)		-		736
Properties		579		16		-			(127	)		2		470
Energy plants		287		2		-			(27	)		12		274
Mining equipment and locomotives (i)		61		241		(172	)		(46	)		12		96
Total		8,121		459		(172	)		(700	)		297		8,005

(i) "Additions and contract modifications" includes the effects arising from the acquisition of NLC in the amount of R$167.

(ii) Impairment loss related to the NLC assets (note 12).

Lease liabilities are presented in note 19.

Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

16. Financial and capital risk management

a) Effects of derivatives on the balance sheet

	Consolidated
	Assets
	September 30, 2021				December 31, 2020
	Current		Non-current		Current		Non-current
Foreign exchange and interest rate risk
IPCA swap		218		-		37		197
Eurobonds swap		-		-		-		13
Pre-dollar swap and forward (NDF)		125		64		-		46
Libor swap		-		25		-		-
		343		89		37		256
Commodities price risk
Base metals products		174		39		158		-
Gasoil, Brent and freight		271		-		503		-
Thermal and coking coal		2				-		-
		447		39		661		-

Others		-		63		-		91
		-		63		-		91
Total		790		191		698		347

	Consolidated
	Liabilities
	September 30, 2021				December 31, 2020
	Current		Non-current		Current		Non-current
Foreign exchange and interest rate risk
CDI & TJLP vs. US$ fixed and floating rate swap		929		2,592		576		2,724
IPCA swap		11		633		382		520
Eurobonds swap		-		-		19		-
Pre-dollar swap and forward (NDF)		328		203		324		303
Libor swap		11		-		5		31
		1,279		3,428		1,306		3,578
Commodities price risk
Base metals products		157		-		242		-
Gasoil, Brent and freight		-		-		64		-
Thermal and coking coal		353		-		-		-
		510		-		306		-

Others		27		-		100		-
Total		1,816		3,428		1,712		3,578

a.i) Net exposure

	Consolidated
	September 30, 2021			December 31, 2020
Foreign exchange and interest rate risk
CDI & TJLP vs. US$ fixed and floating rate swap		(3,521	)		(3,300	)
IPCA swap		(426	)		(668	)
Eurobonds swap		-			(6	)
Pre-dollar swap and forward (NDF)		(342	)		(581	)
Libor swap (i)		14			(36	)
		(4,275	)		(4,591	)
Commodities price risk
Base metals products		56			(84	)
Gasoil, Brent and freight		271			439
Thermal and coking coal		(351	)		-
		(24	)		355

Others		36			(9	)
		36			(9	)
Total		(4,263	)		(4,245	)

(i) In July 2017, the U.K. Financial Conduct Authority (FCA), which regulates the London Interbank Offered Rate (‘‘LIBOR’’), announced the effective discontinuation of LIBOR. After June 30, 2023, the FCA will no longer require panel banks to submit quotes for any U.S. dollar LIBOR settings. The Company is currently evaluating the potential impact of the eventual replacement of the LIBOR interest rate.

Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

a.ii) Effects of derivatives on the income statement and cash flows

	Consolidated
	Gain (loss) recognized in the income statement
	Three-month period ended September 30,						Nine-month period ended September 30,
	2021			2020			2021			2020
Foreign exchange and interest rate risk
CDI & TJLP vs. US$ fixed and floating rate swap		(1,024	)		(312	)		(781	)		(4,407	)
IPCA swap		(219	)		(316	)		148			(1,528	)
Eurobonds swap		-			137			(154	)		30
Pre-dollar swap and forward (NDF)		(1,245	)		(310	)		(192	)		(1,117	)
Libor swap		8			(30	)		47			(58	)
		(2,480	)		(831	)		(932	)		(7,080	)
Commodities price risk
Base metals products		10			-			(3	)		-
Gasoil, Brent and freight		62			200			627			(898	)
		72			200			624			(898	)
Others		15			(420	)		45			112
		15			(420	)		45			112
Total		(2,393	)		(1,051	)		(263	)		(7,866	)

	Consolidated
	Financial settlement inflows (outflows)
	Three-month period ended September 30,						Nine-month period ended September 30,
	2021			2020			2021			2020
Foreign exchange and interest rate risk
CDI & TJLP vs. US$ fixed and floating rate swap		(56	)		(343	)		(584	)		(591	)
IPCA swap		-			-			(97	)		1
Eurobonds swap		-			-			(162	)		(24	)
Pre-dollar swap and forward (NDF)		15			(176	)		(435	)		(234	)
Libor swap		(1	)		3			(5	)		(1	)
		(42	)		(516	)		(1,283	)		(849	)
Commodities price risk
Base metals products		(78	)		-			(117	)		-
Gasoil, Brent and freight		322			(183	)		814			(880	)
Thermal and coking coal		(88	)		-			(88	)		-
		156			(183	)		609			(880	)
Others		-			27			-			1,791
		-			27			-			1,791
Total		114			(672	)		(674	)		62

a.iii) Hedge accounting

	Consolidated
	Gain (loss) recognized in the other comprehensive income
	Three-month period ended September 30,						Nine-month period ended September 30,
	2021			2020			2021			2020
Net investments hedge		(662	)		(458	)		(441	)		(3,484	)
Thermal and coking coal cash flow hedge		(63	)		-			(87	)		-
Cash flow hedge (Nickel and Palladium)		113			(299	)		31			(291	)

Net investment hedge:

In March 2021, the Company redeemed all its euro bonds (note 19). As a result, the amount of debt designated as a hedge instrument for this investment is R$12,281 (US$2,258 million) as at September 30,2021.

Cash flow hedge (Coking Coal):

To reduce the volatility of its cash flow as a result of fluctuations in coking coal prices, in July 2021, the Company implemented a Coking Coal Revenue Hedge Program. Under this program, hedge transactions were executed through forward contracts to protect a portion of the projected sales of this product at fluctuating prices that is highly probable to occur. Hedge accounting treatment is being given to the program. The contracts are traded over-the-counter and the cash settlement in/out results are offset by the protected items' loss/gain results due to coking coal price variations.

Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

	Notional (ton)				Fair value								Financial settlement Inflows (Outflows)			Value at Risk		Fair value by year
Flow	September 30, 2021		December 31,2020		Bought / Sold	Average strike (US$/t oz)		September 30, 2021			December 31, 2020		September 30, 2021			September 30, 2021		2021
Coking Coal Revenue Hedging Program		69,000		-	S		303		(11	)		-		(6	)		4		(11	)

Cash flow hedge (Thermal Coal):

	Notional (ton)				Fair value									Financial settlement Inflows (Outflows)			Value at Risk		Fair value by year
Flow	September 30, 2021		December 31, 2020		Bought / Sold		Average strike (US$/t oz)		September 30, 2021			December 31, 2020		September 30, 2021			September 30, 2021		2021
Thermal Coal Revenue Hedging Program
New Castle Forward		300,000		-		S		108		(176	)		-		(104	)		31		(176	)
API4 Forward		195,000		-		B		105		(101	)		-		(38	)		15		(101	)
Total										(277	)		-		(142	)		46		(277	)

Cash Flow Hedge (Nickel):

	Notional (ton)				Fair value									Financial settlement Inflows (Outflows)			Value at Risk		Fair value by year
Flow	September 30, 2021		December 31, 2020		Bought / Sold	Average strike (US$/ton)		September 30, 2021			December 31, 2020			September 30, 2021			September 30, 2021		2021
Nickel Revenue Hedging Program (i)
Call options		15,330		58,620	S		17,505		(77	)		(239	)		(162	)		26		(77	)
Put options		15,330		58,620	B		15,000		2			143			-			1		2
Total									(75	)		(96	)		(162	)		27		(75	)

(i) With the hedge structure, the company ensures prices between US$15,000/t and US$17,505/t for the program’s sales volume.

Cash flow hedge (Palladium):

	Notional (t oz)				Fair value									Financial settlement Inflows (Outflows)			Value at Risk		Fair value by year
Flow	September 30, 2021		December 31, 2020		Bought / Sold	Average strike (US$/t oz)		September 30, 2021			December 31, 2020			September 30, 2021			September 30, 2021		2021
Palladium Revenue Hedging Program
Call Options		55,795		7,200	S		3,414		(8	)		(5	)		(2	)		2		(8	)
Put Options		55,795		7,200	B		2,412		185			1			4			24		185
Total									177			(4	)		2			26		177

Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

b) Protection programs for the R$ and EUR denominated debt instruments and other liabilities

	Notional											Fair value						Financial Settlement Inflows (Outflows)			Value at Risk		Fair value by year
Flow	September 30, 2021			December 31, 2020			Index		Average rate			September 30, 2021			December 31, 2020			September 30, 2021			September 30, 2021		2021			2022			2023+
CDI vs. US$ fixed rate swap													(2,717	)		(2,454	)		(227	)		230		(117	)		(577	)		(2,022	)
Receivable		R$	8,545		R$	9,445		CDI		100.44	%
Payable		US$	2,003		US$	2,213		Fix		2.57	%

TJLP vs. US$ fixed rate swap													(804	)		(846	)		(195	)		43		(80	)		(253	)		(471	)
Receivable		R$	1,331		R$	1,651		TJLP +		1.11	%
Payable		US$	360		US$	460		Fix		3.14	%

R$ fixed rate vs. US$ fixed rate swap													(355	)		(575	)		(476	)		129		(15	)		(287	)		(53	)
Receivable		R$	6,132		R$	2,512		Fix		3.72	%
Payable		US$	1,162		US$	621		Fix		-1.59	%

IPCA vs. US$ fixed rate swap													(645	)		(900	)		(332	)		48		(4	)		(23	)		(618	)
Receivable		R$	1,563		R$	2,363		IPCA +		4.54	%
Payable		US$	387		US$	622		Fix		3.88	%

IPCA vs. CDI swap													219			232			35			1		-			219			-
Receivable		R$	744		R$	694		IPCA +		6.63	%
Payable		R$	1,350		R$	550		CDI		9.88	%

EUR fixed rate vs. US$ fixed rate swap													-			(6	)		(162	)		-		-			-			-
Receivable		-			EUR	500		Fix		0.00	%
Payable		-			US$	613		Fix		0.00	%

Forward		R$	6,449		R$	916		B		4.34			13			(6	)		82			116		3			92			(82	)

c) Protection program for Libor floating interest rate US$ denominated debt

	Notional											Fair value					Financial Settlement Inflows (Outflows)			Value at Risk		Fair value by year
Flow	September 30, 2021			December 31, 2020			Index		Average rate			September 30, 2021		December 31, 2020			September 30, 2021			September 30, 2021		2021			2022			2023+
Libor vs. US$ fixed rate swap													14		(36	)		(5	)		11		(2	)		(7	)		24
Receivable		US$	950		US$	950		Libor		0.13	%
Payable		US$	950		US$	950		Fix		0.48	%

d) Protection program for product prices and input costs

	Notional							Fair value					Financial settlement Inflows (Outflows)		Value at Risk		Fair value by year
Flow	September 30, 2021		December 31, 2020		Bought / Sold	Average strike (US$/bbl)		September 30, 2021		December 31, 2020			September 30, 2021		September 30, 2021		2021+
Brent crude oil (bbl)
Call options		1,209,405		13,746,945	B		55		152		478			743		18		152
Put options		1,209,405		13,746,945	S		30		-		(59	)		-		-		-

Forward Freight Agreement (days)
Freight forwards (days)		195		1,625	B		13,288		41		22			127		4		41

Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

e) Embedded derivatives in contracts

	Notional							Fair value						Financial settlement Inflows (Outflows)			Value at Risk		Fair value
Flow	September 30, 2021		December 31, 2020		Bought / Sold	Average strike		September 30, 2021			December 31, 2020			September 30, 2021			September 30, 2021		2021+
Option related to a Special Purpose Entity “SPE” (quantity)
Call option		137,751,623		137,751,623	B		3.10		63			95			-			10		63

Embedded derivatives in contracts for the sale of part of its shareholding (quantity)
Put option		1,105,070,863		1,105,070,863	S		4.47		(5	)		(100	)		-			3		(5	)

Embedded Derivative in natural gas purchase agreement (volume/month)
Call options		729,571		746,667	S		233		(22	)		-			(11	)		14		(22	)

Hedge program for finished products
Nickel forwards		634		-	S		19,139		4			-			(1	)		1		4

Fixed prices sales protection
Nickel forwards		360		-	B		16,277		3			-			8			1		3

Embedded in raw material purchase contract (ton)
Nickel forwards		573		1,979	S		19,271		-			10			-			2		-
Copper forwards		450		976	S		9,361		-			2			-			1		-

f) Sensitivity analysis of derivative financial instruments

The following tables present the potential value of the instruments given hypothetical stress scenarios for the main market risk factors that impact the derivatives positions. The scenarios were defined as follows:

- Probable: the probable scenario was defined as the fair value of the derivative instruments as at September 30, 2021

- Scenario I: fair value estimated considering a 25% deterioration in the associated risk variables

- Scenario II: fair value estimated considering a 50% deterioration in the associated risk variables

Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

Instrument	Instrument's main risk events	Probable			Scenario I			Scenario II
CDI vs. US$ fixed rate swap	R$ depreciation		(2,717	)		(5,525	)		(8,334	)
	US$ interest rate inside Brazil decrease		(2,717	)		(2,853	)		(2,996	)
	Brazilian interest rate increase		(2,717	)		(2,927	)		(3,142	)
Protected item: R$ denominated liabilities	R$ depreciation		n.a.			-			-

TJLP vs. US$ fixed rate swap	R$ depreciation		(804	)		(1,323	)		(1,841	)
	US$ interest rate inside Brazil decrease		(804	)		(819	)		(835	)
	Brazilian interest rate increase		(804	)		(865	)		(918	)
	TJLP interest rate decrease		(804	)		(840	)		(875	)
Protected item: R$ denominated debt	R$ depreciation		n.a.			-			-

R$ fixed rate vs. US$ fixed rate swap	R$ depreciation		(355	)		(1,901	)		(3,447	)
	US$ interest rate inside Brazil decrease		(355	)		(387	)		(419	)
	Brazilian interest rate increase		(355	)		(583	)		(794	)
Protected item: R$ denominated debt	R$ depreciation		n.a.			-			-

IPCA vs. US$ fixed rate swap	R$ depreciation		(645	)		(1,214	)		(1,784	)
	US$ interest rate inside Brazil decrease		(645	)		(674	)		(704	)
	Brazilian interest rate increase		(645	)		(749	)		(851	)
	IPCA index decrease		(645	)		(705	)		(766	)
Protected item: R$ denominated debt	R$ depreciation		n.a.			-			-

IPCA vs. CDI swap	Brazilian interest rate increase		219			205			192
	IPCA index decrease		219			210			201
Protected item: R$ denominated debt linked to IPCA	IPCA index decrease		n.a.			(210	)		(201	)

US$ floating rate vs. US$ fixed rate swap	US$ Libor decrease		14			(14	)		(41	)
Protected item: Libor US$ indexed debt	US$ Libor decrease		n.a.			14			41

NDF BRL/USD	R$ depreciation		13			(1,427	)		(2,866	)
	US$ interest rate inside Brazil decrease		13			(6	)		(25	)
	Brazilian interest rate increase		13			(135	)		(275	)
Protected item: R$ denominated liabilities	R$ depreciation		n.a.			-			-

Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

Instrument	Instrument's main risk events	Probable			Scenario I			Scenario II
Fuel oil protection
Options	Price input decrease		152			75			57
Protected item: Part of costs linked to fuel oil prices	Price input decrease		n.a.			(75	)		(57	)

Forward Freight Agreement
Forwards	Freight price decrease		41			27			13
Protected item: Part of costs linked to maritime freight prices	Freight price decrease		n.a.			(27	)		(13	)

Nickel sales fixed price protection
Forwards	Nickel price decrease		3			(6	)		(14	)
Protected item: Part of nickel revenues with fixed prices	Nickel price decrease		n.a.			6			14

Hedge program for products acquisition for resale
Forwards	Nickel price increase		4			(2	)		(7	)
Protected item: Part of revenues from products resale	Nickel price increase		n.a.			2			7

Nickel Revenue Hedging Program
Options	Nickel price increase		(75	)		(418	)		(793	)
Protected item: Part of nickel future revenues	Nickel price increase		(75	)		418			793

Palladium Revenue Hedging Program
Options	Palladium price increase		177			73			(9	)
Protected item: Part of palladium future revenues	Palladium price increase		177			(73	)		9

Thermal Coal Revenue Hedging Program
Forwards	Thermal coal price increase		(277	)		(418	)		(559	)
Protected item: Part of thermal coal future revenues	Thermal coal price increase		(277	)		418			559

Coking Coal Revenue Hedging Program
Forwards	Coking coal price increase		(11	)		(42	)		(74	)
Protected item: Part of coking coal future revenues	Coking coal price increase		(11	)		42			74

Option - SPCs	SPCs stock value decrease		63			28			12

Instrument	Main risks	Probable			Scenario I			Scenario II
Embedded derivatives - Raw material purchase (nickel)	Nickel price increase		-			(16	)		(31	)
Embedded derivatives - Raw material purchase (copper)	Copper price increase		-			(6	)		(11	)
Embedded derivatives - Gas purchase	Pellet price increase		(22	)		(42	)		(60	)
Embedded derivatives - Guaranteed minimum return	Stock value decrease		(5	)		(236	)		(1,525	)

Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

g) Financial counterparties’ credit risk ratings

The table below presents the credit risk ratings published by Moody’s regarding the main financial institutions that we hire derivative instruments, cash and cash equivalents transactions.

	Consolidated
	September 30, 2021				December 31, 2020
	Cash and cash equivalents and short-term investment		Derivatives		Cash and cash equivalents and short-term investment		Derivatives
Aa1		552		-		11,487		188
Aa2		1,124		117		1,884		79
Aa3		1,368		180		8,735		214
A1		5,597		32		14,612		109
A2		21,459		216		20		105
A3		6,849		175		27		188
Baa1		-		-		18		-
Baa2		63		-		8		-
Ba1		-		17		15,516		-
Ba2		16,518		32		21,767		31
Ba3		8,291		-		-		-
Others		70		212		18		131
		61,891		981		74,092		1,045

17. Financial assets and liabilities

a) Financial instruments classification

	Consolidated
	September 30, 2021									December 31, 2020
Financial assets	Amortized cost		At fair value through OCI		At fair value through profit or loss			Total		Amortized cost		At fair value through OCI		At fair value through profit or loss		Total
Current
Cash and cash equivalents (note 19)		59,057		-		-			59,057		70,086		-		-		70,086
Short-term investments (note 19)		-		-		2,834			2,834		-		-		4,006		4,006
Derivative financial instruments (note 16)		-		-		790			790		-		-		698		698
Accounts receivable (note 9)		6,430		-		(1,683	)		4,747		7,865		-		18,079		25,944
Investments in equity securities		-		6,640		-			6,640		-		-		-		-
Related parties (note 26)		-		-		-			-		1,009		-		-		1,009
		65,487		6,640		1,941			74,068		78,960		-		22,783		101,743
Non-current
Judicial deposits (note 23)		6,644		-		-			6,644		6,591		-		-		6,591
Restricted cash		659		-		-			659		197		-		-		197
Derivative financial instruments (note 16)		-		-		191			191		-		-		347		347
Investments in equity securities		-		33		-			33		-		3,936		-		3,936
Related parties (note 26)		-		-		-			-		4,791		-		-		4,791
		7,303		33		191			7,527		11,579		3,936		347		15,862
Total of financial assets		72,790		6,673		2,132			81,595		90,539		3,936		23,130		117,605

Financial liabilities
Current
Suppliers and contractors		22,282		-		-			22,282		17,496		-		-		17,496
Derivative financial instruments (note 16)		-		-		1,816			1,816		-		-		1,712		1,712
Loans, borrowings and leases (note 19)		7,318		-		-			7,318		5,901		-		-		5,901
Dividends payable		193		-		-			193		6,342		-		-		6,342
Liabilities related to the concession grant (note 14)		2,130		-		-			2,130		1,088		-		-		1,088
Related parties (note 26)		721		-		-			721		3,759		-		-		3,759
Other financial liabilities (note 11)		3,805		-		-			3,805		3,347		-		-		3,347
		36,449		-		1,816			38,265		37,933		-		1,712		39,645
Non-current
Derivative financial instruments (note 16)		-		-		3,428			3,428		-		-		3,578		3,578
Loans, borrowings and leases (note 19)		66,578		-		-			66,578		72,187		-		-		72,187
Related parties (note 26)		-		-		-			-		4,655		-		-		4,655
Participative stockholders' debentures (note 18)		-		-		22,452			22,452		-		-		17,737		17,737
Liabilities related to the concession grant (note 14)		9,012		-		-			9,012		10,928		-		-		10,928
Financial guarantees (note 13)		-		-		2,926			2,926		-		-		4,558		4,558
		75,590		-		28,806			104,396		87,770		-		25,873		113,643
Total of financial liabilities		112,039		-		30,622			142,661		125,703		-		27,585		153,288

Selected Notes to the Interim Financial Statements

Expressed in millions of Brazilian reais, unless otherwise stated

b) Hierarchy of fair value

	Consolidated
	September 30, 2021										December 31, 2020
	Level 1		Level 2			Level 3		Total			Level 1		Level 2		Level 3		Total
Financial assets
Short-term investments		2,834		-			-		2,834			4,006		-		-		4,006
Derivative financial instruments		-		918			63		981			-		950		95		1,045
Accounts receivable		-		(1,683	)		-		(1,683	)		-		18,079		-		18,079
Investments in equity securities		6,673		-			-		6,673			3,936		-		-		3,936
Total		9,507		(765	)		63		8,805			7,942		19,029		95		27,066

Financial liabilities
Derivative financial instruments		-		5,239			5		5,244			-		5,190		100		5,290
Participative stockholders' debentures		-		22,452			-		22,452			-		17,737		-		17,737
Financial guarantees		-		2,926			-		2,926			-		4,558		-		4,558
Total		-		30,617			5		30,622			-		27,485		100		27,585

There were no transfers between levels 1, 2 and 3 of the fair value hierarchy during the nine-month period ended September 30, 2021.

b.i) Changes in Level 3 assets and liabilities during the period

	Consolidated
	Derivative financial instruments
	Financial assets			Financial liabilities
Balance at December 31, 2020		95			100
Gain and losses recognized in income statement		(32	)		(95	)
Balance at September 30, 2021		63			5

c) Fair value of loans and financing

	Consolidated
	September 30, 2021				December 31, 2020
	Carrying amount		Fair value		Carrying amount		Fair value
Quoted in the secondary market:
Bonds		40,513		50,822		38,709		52,100
Eurobonds		-		-		4,783		5,118
Debentures		2,170		2,170		2,576		2,578
Debt contracts in Brazil in:
R$, indexed to TJLP, TR, IPCA, IGP-M and CDI		2,143		2,143		4,470		4,452
R$, with fixed interest		98		98		180		180
Basket of currencies and bonds in US$ indexed to LIBOR		120		291		290		291
Debt contracts in the international market in:
US$, with variable and fixed interest		18,141		17,895		16,759		17,036
Other currencies, with variable interest		484		60		-		-
Other currencies, with fixed interest		587		645		616		698
Total		64,256		74,124		68,383		82,453

Due to the short-term cycle, the fair value of cash and cash equivalents balances, financial investments, accounts receivable and accounts payable approximate their book values.

18. Participative stockholders’ debentures

At the time of its privatization in 1997, the Company issued a total of 388,559,056 debentures to then-existing stockholders, including the Brazilian Government. The debentures’ terms were set to ensure that pre-privatization stockholders would participate in potential future benefits that might be obtained from exploration of mineral resources. This obligation will cease when all the relevant mineral resources are exhausted, sold or otherwise disposed of by the Company.

Holders of participative stockholders’ debentures have the right to receive semi-annual payments equal to an agreed percentage of revenues less value-added tax, transport fee and insurance expenses related to the trading of the products, derived from these mineral resources. On October 1, 2021 (subsequent event), the Company made available for withdrawal as remuneration the amount of R$1,244 (US$236 million) for the first semester of 2021, as disclosed on the “Shareholders’ debentures report” made available on the Company’s website.

Selected Notes to the Interim Financial Statements

Expressed in millions of Brazilian reais, unless otherwise stated

To calculate the fair value of the liability, the Company uses the weighted average price of trades in the secondary market for the last month of the quarter. The average price increased from R$45.65 per debenture for the year ended December 31, 2020, to R$57.78 per debenture for the period ended September 30, 2021 (R$36.76 for the period ended September 30, 2020), resulting in an expense of R$5,886 (US$1,109 million) recorded in the income statement for the nine-month period ended September 30, 2021 (R$4,341 (US$833 million) for the nine-month period ended September 30, 2020), respectively. As at September 30, 2021 the liability was R$22,452 (US$4,128 million) (R$17,737 (US$3,413 million) as at December 2020).

The average price decreased from R$60.34 per debenture for the period ended June 30, 2021, to R$57.78 per debenture for the period ended September 30, 2021 (R$29.04 for the period ended June 30, 2020), resulting in a gain of R$825 (US$152 million) recorded in the income statement for the three-month period ended September 30, 2021 (R$3,002 (US$553 million) for the three-month period ended September 30, 2020).

19. Loans, borrowings, leases, cash and cash equivalents and short-term investments

a) Net debt

	Consolidated
	September 30, 2021		December 31, 2020
Debt contracts (d.i)		65,008		69,426
Leases (d.ii)		8,888		8,662
Total of loans, borrowings and leases		73,896		78,088

(-) Cash and cash equivalents		59,057		70,086
(-) Short-term investments		2,834		4,006
Net debt		12,005		3,996

b) Cash and cash equivalents

Cash and cash equivalents include cash, immediately redeemable deposits and short-term investments with an insignificant risk of change in value. They are readily convertible to cash, being R$27,529 (US$5,061 million) (R$14,805 (US$2,849 million) as at December 31, 2020) denominated in R$, indexed to the CDI, R$30,043 (US$5,523 million) (R$52,979 (US$10,195 million) as at December 31, 2020) denominated in US$ and R$1,485 (US$273 million) (R$2,302 (US$443 million) as at December 31, 2020) denominated in other currencies as at September 30,2021.

c) Short-term investments

At September 30, 2021, the balance of R$2,834 (US$521 million) (R$4,006 (US$771 million) as at December 31, 2020) is substantially comprised of investments in an exclusive investment fund immediately liquid, whose portfolio is composed of committed transactions and Brazilian Financial Treasury Bills (“LFTs”), which are floating-rate securities issued by the Brazilian government.

d) Loans, borrowings and leases

d.i) Total debt

				Consolidated
				Current liabilities				Non-current liabilities
	Average interest rate (i)			September 30, 2021		December 31, 2020		September 30, 2021		December 31, 2020
Quoted in the secondary market:
US$, Bonds		6.02	%		-		-		40,513		38,709
Eurobonds					-		-		-		4,783
R$, Debentures (ii)		10.48	%		1,001		555		1,169		2,021
Debt contracts in Brazil in (ii):
R$, indexed to TJLP, TR, IPCA, IGP-M and CDI		10.17	%		636		1,662		1,507		2,808
R$, with fixed interest		2.74	%		87		107		11		73
Basket of currencies and bonds in US$ indexed to LIBOR		2.32	%		120		232		-		58
Debt contracts in the international market in:
US$, with variable and fixed interest		2.23	%		3,400		942		14,741		15,817
Other currencies, with variable interest		4.09	%		430		-		54		-
Other currencies, with fixed interest		3.36	%		65		61		522		555
Debts contracts					5,739		3,559		58,517		64,824
Accrued charges					752		1,043		-		-
					6,491		4,602		58,517		64,824

Selected Notes to the Interim Financial Statements

Expressed in millions of Brazilian reais, unless otherwise stated

(i) In order to determine the average interest rate for debt contracts with floating rates, the Company used the rate applicable as at September 30, 2021.

(ii) The Company entered into derivative transactions to mitigate the exposure to the cash flow variations of all floating rate debt contracted in Brazil, resulting in an average cost of 2,93% per year in US$.

Future flows of debt payments, principal and interest

	Consolidated
	Principal		Estimated future interest payments (i)
2021		312		694
2022		5,853		3,192
2023		2,398		2,999
2024		10,913		2,904
Between 2025 and 2029		11,511		5,464
2030 onwards		33,269		19,796
Total		64,256		35,049

(i) Based on interest rate curves and foreign exchange rates applicable as at September 30, 2021 and considering that the payments of principal will be made on their contracted payments dates. The amount includes the estimated interest not yet accrued and the interest already recognized in the interim financial statements.

Credit and financing lines

The Company has two revolving credit facilities to assist the short-term liquidity management and to enable more efficiency in cash management in the available amount of R$27,197 (US$5,000 million), of which R$10,879 (US$2,000 million) will mature in 2022 and R$16,318 (US$3,000 million) in 2024. As at September 30, 2021, these lines are undrawn.

Funding and payments

In January 2021, the Company contracted the credit line R$1,633 (US$300 million) with The New Development Bank maturing at 2035 and indexed to Libor + 2.49% per year.

In March 2021, the Company redeemed all of its 3.750% bonds due January 2023, in the total amount of R$4,946 (EUR750 million) and for it paid a premium of R$354 (US$63 million), which was recorded as “Expenses with cash tender offer redemption” under the financial results for nine-month period ended September 30, 2021. The remaining amount paid were made in connection with the schedule of disbursements in accordance with the terms of the contracted debts.

Covenants

Some of the Company’s debt agreements with lenders contain financial covenants. The primary financial covenants in those agreements require maintaining certain ratios, such as debt to EBITDA (LAJIDA) (as defined in note 4(a)) and interest coverage. The Company has not identified any instances of noncompliance as at September 30, 2021.

Reconciliation of debt to cash flows

	Consolidated
	Quoted in the secondary market			Debt contracts in Brazil			Debt contracts on the international market			Total
December 31, 2020		47,010			4,980			17,436			69,426
Additions		-			-			1,633			1,633
Payments (i)		(5,722	)		(497	)		(2,287	)		(8,506	)
Interest paid (ii)		(2,201	)		(331	)		(672	)		(3,204	)
Effect on cash flow		(7,923	)		(828	)		(1,326	)		(10,077	)

Effect of exchange rate		2,486			(2,048	)		2,622			3,060
Interest accretion		1,785			269			545			2,599
Non-cash changes		4,271			(1,779	)		3,167			5,659

September 30, 2021		43,358			2,373			19,277			65,008

(i) Includes expenses with the redemption in the amount of R$354.

(ii) Classified as cash flows arising from operating activities.

Selected Notes to the Interim Financial Statements

Expressed in millions of Brazilian reais, unless otherwise stated

d.ii) Lease liabilities

	Consolidated
	December 31, 2020		Additions and contract modifications		Payments (i)			Interest (ii)		Translation adjustment			September 30, 2021
Ports		3,860		-		(338	)		113		135			3,770
Vessels		2,770		-		(255	)		85		125			2,725
Pellets plants		708		200		(42	)		26		-			892
Properties		738		16		(150	)		15		(15	)		604
Energy plants		322		2		(20	)		21		6			331
Mining equipment and locomotives (iii)		264		336		(55	)		13		8			566
Total		8,662		554		(860	)		273		259			8,888

(i) The total amount of the variable lease payments not included in the measurement of lease liabilities, which have been recognized straight to the income statement, for the three and nine-month periods ended September 30, 2021 was R$866 and R$1,457 (R$54 and R$253 for the three and nine-month periods ended September 30, 2020), respectively.

(ii) The interest accretion recognized in the income statement is disclosed in note 6.

(iii) "Additions and contract modifications" includes the effect of R$262 due to the NLC acquisition (note 12).

Annual minimum payments

	2021		2022		2023		2024		2025 onwards		Total
Ports		92		334		326		321		4,344		5,417
Vessels		89		346		336		328		2,200		3,299
Pellets plants		190		202		67		67		581		1,107
Properties		89		143		119		107		209		667
Energy plants		9		37		35		31		325		437
Mining equipment and locomotives		31		116		90		83		433		753
Total		500		1,178		973		937		8,092		11,680

The table above presents the undiscounted lease obligation by maturity date. The lease liability recognized in the balance sheet is measured at the present value of such obligations.

e) Guarantees

As at September 30, 2021 and December 31, 2020, loans and borrowings are secured by property, plant and equipment in the amount of R$451 (US$83 million) and R$915 (US$176 million), respectively. The securities issued through Vale’s wholly-owned finance subsidiary Vale Overseas Limited are fully and unconditionally guaranteed by Vale.

20. Brumadinho dam failure

On January 25, 2019, a tailings dam (“Dam I”) failed at the Córrego do Feijão mine, in the city of Brumadinho, state of Minas Gerais. The failure released a flow of tailings debris, destroying some of Vale’s facilities, affecting local communities and disturbing the environment. The tailings released have caused an impact of around 315 km in extension, reaching the nearby Paraopeba River. The dam failure in Brumadinho (“event”) resulted in 270 fatalities, including 8 victims still missing, and caused extensive property and environmental damage in the region.

As a result of the dam failure, the Company has recognized provisions to meet its assumed obligations, individual indemnification to those affected by the event, remediation of the affected areas and compensation to the society. The Company also recognized a provision for de-characterization of the dams. Below are the changes in during the current period:

	Consolidated
	December 31, 2020		Operating expense		Monetary and present value adjustments			Disbursements (ii)			September 30, 2021
Global settlement for Brumadinho		20,726		-		1,267			(495	)		21,498
Provision for individual indemnification and other commitments		3,048		-		(49	)		(800	)		2,199
Liabilities related to Brumadinho		23,774		-		1,218			(1,295	)		23,697

De-characterization of dams		11,897		-		(442	)		(1,356	)		10,099
Incurred expenses (i)		-		2,437		-			(2,437	)		-
		35,671		2,437		776			(5,088	)		33,796

Selected Notes to the Interim Financial Statements

Expressed in millions of Brazilian reais, unless otherwise stated

(i) The Company has incurred expenses, which have been recognized straight to the income statement, in relation to communication services, accommodation and humanitarian assistance, equipment, legal services, water, food aid, taxes, among others. For the three and nine-month periods ended September 30, of 2021, the Company incurred expenses in the amount of R$847 and R$2,437, respectively (R$613 and R$1,906 for the three and nine-month periods ended September 30, 2020).

(ii) Disbursement is presented net of the judicial deposits utilization.

a) Global Settlement for Brumadinho

On February 4, 2021, the Company entered into a Judicial Settlement for Integral Reparation (“Global Settlement”), which was under negotiations since 2019, with the State of Minas Gerais, the Public Defender of the State of Minas Gerais and the Federal and the State of Minas Gerais Public Prosecutors Offices, to repair the environmental and social damage resulting from the Dam I rupture. The Global Settlement was ratified by the Minas Gerais State Court on February 4, 2021, and the res judicata was drawn up on April 7, 2021.

With the Global Settlement, the requests contained in public civil actions regarding the socio-environmental and socioeconomic collective damages caused by the dam rupture were substantially resolved and the parameters for the reparation and compensation of said damages were established. As a result, the Company recorded an additional provision as at December 31, 2020.

The provision is discounted at presented value using an observable rate that reflects the current market assessments of the time value of money and the risks specific to the liability at the reporting date. During the current year, the discount rate applied on the provisions for the Global Settlement, individual indemnification and other commitments, has increased from 2.0% at December 31, 2020 to 4.6% at September 30, 2021. Additionally, the provisions were updated by the consumer price index (IPCA), as required by the Global Agreement, resulting in an impact of R$1,737 (US$329 million), recorded in income statement for the three-month period ended September 30, 2021.

Based on the present value of the projected cash outflows, the provision related to Global Settlement is detailed as follows:

			Consolidated
	September 30, 2021		December 31, 2020
Cash settlement obligation, net of judicial deposits		12,656		12,172
Provision for socio-economic reparation and others		4,673		4,468
Provision for social and environmental reparation		4,169		4,086
		21,498		20,726

	September 30, 2021	December 31, 2020
Current liabilities	11,428	8,110
Non-current liabilities	10,070	12,616
Liabilities	21,498	20,726

(a.i) Cash settlement obligation

The cash settlement obligation relates to the socio-economic reparation and socio-environmental compensation projects that will be carried out or managed directly by the State of Minas Gerais and Institutions of Justice, mainly aiming to develop the urban mobility program and strengthening public service programs, as well as other projects that will be proposed by the affected population. In addition, resources will be used in a program of income transfer to those affected by the event, which will be carried out by Institutions of Justice. Of the total amount, R$4,400 (US$809 million) relates to the income transfer program that will be fully paid in 2021. The remaining amount of R$8,256 (US$1,518 million) is the present value of the semiannual fixed payments obligation, which will last 5 years on average.

(a.ii) Provision for socio-economic reparation and others

The Global Settlement includes remediation projects for Brumadinho and other affected municipalities of the Paraopeba basin. The socioeconomic reparation actions aim to strengthen the productive activities of the affected region, through measures for greater economic diversification of the municipality of Brumadinho, reducing its historical dependence on mining, and, for the rest of the Basin, finding ways to support the transformation of the economy of the impacted municipalities. These projects will be carried out directly by the Company for an average period of 3 years.

The estimated amounts for the project execution, although set in the agreement, may vary since the implementation of those projects are Vale's responsibility and changes against the original budget may result in changes in provision in future reporting periods.

Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

(a.iii) Provision for social and environmental reparation

The Global Settlement establishes the rule for the development of the environmental reparation plan, and projects for the compensation of environmental damage already known. These measures aim to repair the damage caused, restore the ecosystems disruption, restore local infrastructure, repair social and economic losses, recover affected areas and repair the loss of memory and cultural heritage caused by the dam rupture. It also includes several actions to clean up the affected areas and improvements to the water catchment system along the Paraopeba River and other water collection points near the affected area. These measures and compensation projects will be carried out directly by the Company for an average period of 5 years.

The estimated amount to carry out the environmental recovery actions is part of the Global Settlement. However, it has no cap due to the Company's legal obligation to fully repair the environmental damage caused by the dam rupture. Therefore, this provision may change in the future depending on several factors that are not under the control of the Company.

b) Provision for individual indemnification and other commitments

For the individual indemnification, Vale and the Public Defendants of the State of Minas Gerais formalized an agreement on April 5, 2019, under which those affected by the Brumadinho’s Dam failure may join an individual or family group out-of-Court settlement agreements for the indemnification of material, economic and moral damages. This agreement establishes the basis for a wide range of indemnification payments, which were defined according to the best practices and case law of Brazilian Courts, following rules and principles of the United Nations (“UN”). As at September 30, 2021, the provision recorded is R$693 (US$127 million) (R$930 (US$179 million) as at December 31, 2020).

In addition to the Global Settlement, the Company has been working to ensure geotechnical safety of the remaining structures at the Córrego do Feijão mine, in Brumadinho, and the removal and proper disposal of the tailings of Dam I. As at September 30, 2021, the provision recorded is R$1,216 (US$224 million) (R$1,387 (US$267 million) as at December 31, 2020).

In addition, the Company was notified of the imposition of administrative fines by the Brazilian Institute of the Environment and Renewable Natural Resources (“IBAMA”), in the amount of R$250 (US$46 million). The Company signed an agreement with IBAMA, of which R$150 (US$27 million) will be used in environmental projects in 7 parks in the state of Minas Gerais, covering an area of approximately 794 thousand hectares, and R$100 (US$18 million) will be used in basic sanitation programs in the state of Minas Gerais.

c) De-characterization of other dams in Brazil

Following the Brumadinho Dam rupture, the Company has decided to speed up the plan to “de-characterize” its tailings dams built under the upstream method (same method as Brumadinho’s dam), certain “centerline structures” and dikes, located in Brazil. In September 2020, the federal government enacted Law no. 14,066, which modified the National Dam Safety Policy (Law no. 12.334/2020), reinforcing the prohibition of constructing and raising upstream dams in Brazil. The statute also requires companies to decharacterize the structures built using the upstream method by 2022, or by a later date if it is proven that the decharacterization is not technically feasible by 2022.

The Company's projects of de-characterization of dams are projected to last 8 years on average and were discounted at the present value using an observable rate, which increased from 3.5% at December 31, 2020 to 5.0% at September 30, 2021. The Company has a total provision to comply with these assumed obligations in the amount of R$10,099 (US$1,857 million) at September 30, 2021 (R$11,897 (US$2,289 million) as at December 31, 2020).

(c.i) Operation stoppages

The Company has suspended some operations due to judicial decisions or technical analysis performed by Vale on its upstream dam structures. The Company has been recording losses in relation to the operational stoppage and idle capacity of the ferrous mineral segment in the amounts of R$330 (US$63 million) and R$1.376 (US$256 million) for the three and nine-months periods ended September 30,2021 (R$600 (US$111 million) and R$1,879 (US$378 million) for the three and nine-months periods ended September 30, 2020), respectively. The Company is working on legal and technical measures to resume all operations at full capacity.

d) Contingencies and other legal matters

(d.i) Requests for fines or forfeit of assets

On August 26, 2020, the Public Prosecutor's Office of Minas Gerais (“MPMG”) and other plaintiffs of the Public Civil Actions presented a request for ruling condemning Vale to indemnify alleged economic losses of the State of Minas Gerais and collective moral damages, both claims already considered in said Public Civil Actions filed against Vale in January 2019 as a result of the Brumadinho dam rupture. In that submission, the plaintiffs also requested the immediate freezing of R$26.7 billion (US$4.9 billion) from the Company as a guarantee for the reimbursement of the alleged economic losses, which was dismissed by the judge of the 2nd Lower Court of Public Treasury of Belo Horizonte on October 6, 2020. This claim was extinguished with the Global Settlement.

Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

In other proceeding, in May 2020, the MPMG requested the imposition of fines or forfeit of assets, rights and amounts of the Company, allegedly based on Article 5, item V of Brazilian Law 12.846/2013. According to the MPMG, Vale would have, through its employee’s actions, hindered the inspection activities of public agencies in the complex. Vale was not required to present any guarantees of R$7.9 billion (US$1.4 billion) based on a judicial decision. The Company believes that the likelihood of loss is remote.

In January 2021, the Comptroller General of the State of Minas Gerais (“CGE”) notified Vale to present it defense against the Administrative Liability Proceeding (“PAR”) initiated based on the same article. Vale presented its defense in March 2021, and filed a writ of mandamus in the face of the establishment of this PAR, which had the injunction granted to suspend the proceeding of the PAR.

In October 2020, the Company was informed that the Brazilian Office of the Comptroller General (“CGU”) initiated an administrative proceeding based on the same allegations made by the MPMG. As this is a discretionary procedure from the CGU, the Company estimates its likelihood of a loss during the administrative phase as possible, but it reaffirms its assessment of loss as remote in the annulment lawsuit to be instituted against any decision by CGU, if necessary.

(d.ii) U.S. Securities putative class action suit

Vale is defending itself in a putative class action brought before a Federal Court in New York and filed by holders of securities - American Depositary Receipts ("ADRs") - issued by Vale. The Lead Plaintiff alleges that we made false and misleading statements or omitted to make disclosures concerning the risks of the operations of Dam I in the Córrego do Feijão mine and the adequacy of the related programs and procedures.

Following the decision of the Court, in May 2020, that denied the Motion to Dismiss presented by the Company, the Discovery phase has started, and the fact Discovery was expected to be concluded by June 2021. However, due to the pandemic, the fact Discovery term has been extended to be concluded by March 2022, the fact Discovery is currently ongoing. In parallel, in February 2021 the Plaintiff filed a motion for class certification, which we opposed in April, 2021. In June, 2021 a Reply was filed by the Plaintiff and rebuttal expert reports were filed by the parties. A decision by the Court on the motion for class certification is expected to be issued in the upcoming weeks.

Based on the evaluation of the Company's legal counsel and given the very preliminary stage, the expectation of loss of this process is classified as possible. However, considering the initial stage of this putative class action, it is not possible at this time to reliably estimate the amount of a potential loss.

(d.iii) Arbitration proceedings in Brazil filed by shareholders and a class association

In Brazil, Vale is a defendant in (i) one arbitration filed by 351 minority shareholders, (ii) one arbitration filed by a class association allegedly representing all Vale’s minority shareholders, and (iii) one arbitration filed by foreign investment funds.

In the three proceedings, the Claimants argue Vale would be aware of the risks associated with the dam, and failed to disclose it to the shareholders, which would be required under the Brazilian applicable laws and the rules of Comissão de Valores Mobiliários (Securities and Exchange Commission of Brazil). Based on such argument, they claim compensation for losses caused by the decrease of the value of the shares.

Based on the evaluation of the Company's legal counsel and given the very preliminary stage, the expectation of loss of these proceedings is classified as possible.

Specifically, in the proceeding filed by foreign funds, the Claimants estimated the amount of the alleged losses at approximately R$1,800 (US$330 million). However, the Company disagrees with the estimated losses alleged by the foreign funds and believes that the likelihood of loss is remote based on the current status of the proceeding.

(d.iv) Investigation by the Securities and Exchange Commission (“SEC”) and CVM

Vale has been notified that the SEC staff has made a preliminary determination to recommend that the SEC commence proceedings against Vale alleging violations of U.S. securities laws related to Vale’s disclosures about its dam safety management and the dam at Brumadinho. If the SEC authorizes an action against Vale, the SEC could seek an injunction against future violations of U.S. federal securities laws, the imposition of civil monetary penalties, disgorgement and other relief within the SEC's authority in a lawsuit filed in a federal court. The CVM is also conducting investigation relating to Vale's disclosure of relevant information to shareholders, investors and the market in general, especially regarding the conditions and management of Vale's dams. At this time, it is not yet possible to estimate the value or a range of potential loss to the Company.

Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

(d.v) Criminal proceedings and investigations

In January 2020, the MPMG brought criminal charges against 16 individuals (including former executive officers of Vale and former employees) for a number of potential crimes, including homicide, and against Vale S.A. for alleged environmental crimes. These charges were accepted by the state criminal judge in the city of Brumadinho on February 14, 2020, however, on October 19, 2021, the Superior Court of Justice annulled this decision and determined that it should be judged by the Federal Court. Vale intends to vigorously defend itself against the criminal claims, and the Company cannot estimate when a decision on this criminal proceeding will be issued.

(d.vi) Labor Collective Civil Action

In 2021, public civil actions were filed by a labor union in the Labor Court of Betim in the Brazilian State of Minas Gerais, claiming the indemnification payment for death damage to each direct and outsourced employee who has died due to the Dam I rupture. They are claiming to represent 246 workers and have requested indemnification payments ranging between R$1.5 (US$276 thousand) and R$3 (US$552 thousand) to each fatal victim. There has been an initial decision condemning Vale to pay R$1 (US$184 thousand) per each direct employees (131 fatal victims). Vale is defending itself against these actions and believes that, despite the lack of provision in the Brazilian legal framework, the likelihood of loss is deemed possible.

e) Insurance and financial guarantees

(e.i) Insurance

The Company is negotiating with insurers the payment of indemnification under its operational risk and civil liability. However, these negotiations are still at a preliminary stage, therefore any payment of insurance proceeds will depend on the coverage definitions under these policies and assessment of the amount of loss. Due to uncertainties, no indemnification to the Company was recognized in these interim financial statements.

(e.ii) Financial guarantees

In April 2021, the financial guarantees related to the Brumadinho event were released, due the Global Settlement. As at December 31, 2020, the Company had financial guarantees in the amount of R$5,843 (US$1,124 million).

21. Liabilities related to associates and joint ventures

In November 2015, the Fundão tailings dam owned by Samarco Mineração S.A. (Samarco) failed, releasing tailings downstream, flooding certain communities and causing impacts on communities and the environment along the Doce river. The rupture resulted in 19 fatalities and caused property and environmental damage to the affected areas. Samarco is a joint venture equally owned by Vale S.A. and BHP Billiton Brasil Ltda. (‘‘BHPB’’).

In June 2016, Samarco, Vale and BHPB created the Fundação Renova, a not-for-profit private foundation, to develop and implement (i) social and economic remediation and compensation programs and (ii) environmental remediation and compensation programs in the region affected by the dam rupture. The creation of Fundação Renova was provided for under the agreement for settlement and conduct adjustment (the ‘‘Framework Agreement’’) signed in March 2016 by Vale, BHPB, Samarco, the Brazilian federal government, the two Brazilian states affected by the rupture (Minas Gerais and Espírito Santo) and other governmental authorities.

In June 2018, Samarco, Vale and BHPB entered into a comprehensive agreement with the offices of the federal and state (Minas Gerais and Espírito Santo) prosecutors, public defenders and attorney general, among other parties, improving the governance mechanism of Fundação Renova and establishing, among other things, a process for potential revisions to the remediation programs provided under the Framework Agreement based on the findings of experts hired by Samarco to advise the MPF (Federal Prosecutor’s Office) over a two-year period (the ‘‘June 2018 Agreement’’). Under the Framework Agreement, the June 2018 Agreement and Renova’s by-laws, Fundação Renova must be funded by Samarco, but to the extent that Samarco is unable to fund, Vale and BHPB must ratably bear the funding requirements Under the Framework Agreement.

Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

On April 9, 2021, Samarco announced the request for Judicial Reorganization (“RJ”) was filed with the Minas Gerais Court to renegotiate its debt, which is held by bondholders abroad. The purpose of RJ is to restructure Samarco’s debts and establish an independent and sustainable financial position, allowing Samarco to keep working to resume its operations safely and to fulfill its obligations related to the Renova Foundation.

The RJ does not affect Samarco's obligation to remediate and compensate the impacts of the Fundão tailings dam failure. However, as Samarco began the gradual resumption of operations in December 2020, it is not yet possible to reliably estimate when Samarco will generate cash to comply with its assumed obligation in the TTAC. Thus, the liability recorded by Vale on September 30, 2021 does not consider Samarco's potential cash flows generation. Therefore, the RJ did not have any additional impact on these interim financial statements.

Therefore, the provision related to Renova is R$11,212 (US$2,061 million) as at September 30, 2021 (R$9,634 (US$1,853 million) as at December 31, 2020). In addition, the Company has a provision of R$1,110 (US$204 million) (R$1,148 (US$221 million) as at December 31, 2020) for the de-characterization of the Germano dam.

Movements during the period

	Consolidated
	2021			2020
Balance at January 1,		10,782			6,853
Provision		2,820			2,939
Disbursements		(743	)		(1,586	)
Present value valuation		(537	)		169
Balance at September 30,		12,322			8,375

	September 30, 2021		December 31, 2020
Current liabilities		8,437		4,554
Non-current liabilities		3,885		6,228
Liabilities		12,322		10,782

Renova Foundation

During the second quarter of 2021, Fundação Renova reviewed the assumptions used on the preparation of the estimates incorporated into the mitigation and compensation programs mainly due recent judicial decisions increasing the scope of some TTAC programs. The periodic review, resulted in an additional provision of R$2,820 (US$560 million), recorded in the nine-month period ended September 30, 2021, which corresponds to its portion of the responsibility to support the Renova Foundation. There was no additional provision for the three-month period ended September 30, 2021.

Samarco’s working capital

In addition to the provision, Vale S.A. made available R$113 (US$21 million) during the first quarter of 2021 (2020: R$246 (US$56 million)), which was fully used to fund Samarco’s working capital. This expense was recognized as “Equity results and other results in associates and joint ventures”. No additional amount was made available during the nine-month period ended September 30, 2021 (2020: R$594 (US$119 million)). Vale S.A. may provide an additional short-term credit facility up to R$348 (US$64 million) in 2021.

Contingencies related to Samarco accident

These proceedings include public civil actions brought by Brazilian authorities and multiple proceedings involving claims for significant amounts of damages and remediation measures. The Company expects the Framework Agreements to represent the settlement of the public civil action brought by the MPF and other related proceedings. There are also putative securities class actions in the United States against Vale and some of its current and former officers and a criminal proceeding in Brazil. The main updates regarding the lawsuits in the period were as follows:

(i) Public Civil Action filed by the Federal Government and others and public civil action filed by the Federal Public Prosecutors ("MPF")

The Framework Agreement (“TAC-Gov”) considers the renegotiation of the Renova Foundation's reparation programs depending on the results of the studies carried out by the experts. The negotiations started in April 2021 and a letter of principles was signed in June 2021 by Vale, BHP and Samarco with the representatives of the government and various justice institutions. Negotiations, with mediation by the National Council of Justice, are ongoing.

Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

There has been issued judicial decisions in relation to the “Eixo Prioritário 7”, which aims individual indemnification, including new categories in the scope of the compensation, other municipalities that are not part of the TTAC and the increase of the compensation system related to the municipality of Mariana, which already has its specific conditions set for individual indemnification. Therefore, considering that those decisions are still being disputed and depending on the definitive decisions of these proceedings, the provision recorded by the Company may increase in future reporting periods.

On January 31, 2020, “Eixo Prioritário 10” was created to address the different understanding of parties regarding the scope, deadlines and purpose of the experts hired to assist the affected people, which is a requirement of the TacGov. On October 4, 2021 (subsequent event), a decision was issued determining adjustments to the work plans presented by the experts. Additionally, considering that some groups of affected people have filed a request to dismiss the hiring of these experts, a hearing was scheduled, and it did not yet happen. The Company is assessing the aspects related to this decision, which is not yet definitive and is subject to appeal. Therefore, depending on the judicial developments of this proceeding, the provision recorded by the Company may increase in future reporting periods.

(ii) Class Action in the United States

In March 2017, the holders of securities issued by Samarco Mineração S.A. filed a potential collective action in the New York Federal Court against Samarco, Vale, BHP Billiton Limited, BHP Billiton PLC and BHP Brasil Ltda. based on U.S. Federal Securities laws, which was dismissed without prejudice, in June 2019. In December 2019 the plaintiffs filed a Notice of Appeal to the NY Court of Appeals.

In January 2021, it was held a hearing before the Second Circuit of the New York State Court of Appeals. In March 2021 the Second Circuit denied the plaintiff’s appeal. This decision became res judicata in June 2021, since no further appeal has been filed by the Plaintiff. Thus, the case is closed and should be filed by the Court.

(iii) Criminal proceeding

In September 2019, the federal court of Ponte Nova dismissed all criminal charges against Vale representatives relating to the first group of charges, which concerns the results of the Fundão dam failure, remaining only the legal entity in the passive pole. The second group of charges against Vale S.A. and one of the Company’s employees, which concerns the accusation of alleged crimes committed against the Environmental Public Administration, remained unchanged. In June 2021, the Company filed an appeal with the Superior Court of Justice against the decision of the Federal Regional Court of the 1st Region that did not decided in favor of Vale. In July 2021, the Federal Prosecutor filed an appeal with the Federal Regional Court of the 1st Region, against the judge's decision that rejected the resumption of the procedural instruction, requesting the review of the decision. The Company cannot estimate when a final decision on the case will be issued.

Insurance

Since the Fundão dam rupture, the Company has been negotiating with insurers the indemnification payments based on its general liability policies. For the nine-month period ended September 30, 2021, the Company received payments in the amount of R$181 (US$33 million) and recognized a gain in the income statement as “Equity results and other results in associates and joint ventures”.

22. Provisions

	Consolidated
	Current liabilities				Non-current liabilities
	September 30, 2021		December 31, 2020		September 30, 2021		December 31, 2020
Payroll, related charges and other remunerations		3,968		4,560		-		-
Onerous contracts		201		302		4,598		4,360
Environmental obligations		396		533		952		1,038
Asset retirement obligations (i)		446		516		19,525		21,413
Provision related to VNC sale (note 12)		-		2,598		-		-
Provision related to the Candonga Consortium (ii)		392		213		-		-
Provisions for litigation (note 23)		434		455		5,565		5,216
Employee postretirement obligations (note 24)		563		534		8,926		11,802
Provisions		6,400		9,711		39,566		43,829

(i) As at September 30, 2021, the Company has issued letters of credit and surety bonds to guarantee an amount of R$3,308 of its asset retirement obligation related to the Base Metals operations.

(ii) As at December 31, 2020, the provision related to Candonga Consortium was presented in the balance sheet under "Others" in the current liabilities.

Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

Provision related to the Candonga Consortium - On October 6, 2021 (subsequent event), the Superior Court of Justice issued a judicial decision to suspend the effects of a decision of the Federal Regional Court which assured the maintenance of the Risoleta Neves hydroelectric plant in the Energy Reallocation Mechanism (“MRE”). Thereby, the financial compensation within the MRE for its temporary incapacity of generating electric energy shall not apply to the Candonga Consortium, which is a joint operation between Vale and Aliança Geração de Energia. The plant has been halted since November 2015, due to the dam failure of Fundão, and the carrying value of the consortium assets are fully impaired. Therefore, the Company would be requested by the National Electric Energy Agency (“ANEEL”) and the Chamber of Electric Energy Commercialization (“CCEE”) to pay approximately R$392 (US$72 million), for which the Company has a provision as at September 30, 2021.

23. Litigations

a) Provision for legal proceedings

The Company has considered all information available to assess the likelihood of an outflow of resources and in the preparation on the estimate of the costs that may be required to settle the obligations. The main litigations refer to:

Tax litigations - Mainly refers to the lawsuit filed in 2011 by Valepar (merged by Vale) seeking the right to exclude the amount of dividends received in the form of interest on stockholders’ equity (“JCP”) from the PIS and COFINS tax base. The amount reserved for this proceeding as at September 30, 2021 is R$2,224 (US$409 million) (R$2,197 (US$423 million) as at December 31, 2020). This proceeding is guaranteed by a judicial deposit in the amount of R$2,563 (US$471 million) recorded at September 30, 2021 (R$2,529 (US$487 million) as at December 31, 2020).

Civil litigations - Refers to lawsuits for: (i) indemnities for losses, payments and contractual fines due to contractual imbalance or non-compliance that are alleged by suppliers, and (ii) land claims referring to real estate Vale's operational activities.

Labor litigations - Refers to lawsuits for individual claims by in-house employees and service providers, primarily involving demands for additional compensation for overtime work, moral damages or health and safety conditions.

Environmental litigations - Refers mainly to proceedings for environmental damages and issues related to environmental licensing.

	Consolidated
	Tax litigation			Civil litigation			Labor litigation			Environmental litigation			Total of litigation provision
Balance at December 31, 2020		2,520			1,354			1,741			56			5,671
Additions and reversals, net		(5	)		23			333			5			356
Payments		(25	)		(112	)		(216	)		(21	)		(374	)
Acquisition of NLC (note 12)		-			11			38			-			49
Indexation and interest		30			115			147			1			293
Translation adjustment		-			1			3			-			4
Balance at September 30, 2021		2,520			1,392			2,046			41			5,999
Current liabilities		38			84			311			1			434
Non-current liabilities		2,482			1,308			1,735			40			5,565
		2,520			1,392			2,046			41			5,999

		Consolidated
	Tax litigation			Civil litigation			Labor litigation			Environmental litigation		Total of litigation provision
Balance at December 31, 2019		2,804			1,213			1,835			43		5,895
Additions and reversals, net		89			226			57			9		381
Payments		(66	)		(64	)		(230	)		-		(360	)
Indexation and interest		72			78			88			3		241
Translation adjustment		133			4			1			-		138
Balance at September 30, 2020		3,032			1,457			1,751			55		6,295
Current liabilities		40			80			340			1		461
Non-current liabilities		2,992			1,377			1,411			54		5,834
		3,032			1,457			1,751			55		6,295

Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

b) Contingent liabilities

The main contingent liabilities, updated by applicable interest rates, for which the likelihood of loss is not considered remote are presented by nature as follows:

	Consolidated
	September 30, 2021		December 31, 2020
Tax litigations		43,392		35,914
Civil litigations		8,985		7,005
Labor litigations		2,844		2,926
Environmental litigations		5,116		4,717
Total		60,337		50,562

The contingent liabilities related to the Brumadinho event and Samarco are not presented above. The information is presented in notes 20 and 21.

As reported in the annual financial statements for 2020, the Company is a counterparty in several actions and the main updates on contingent liabilities since then, are discussed as follows:

(b.i) Assessments regarding the disallowance of JCP:

In 2021, Vale received tax assessment for collection of corporate income taxes (IRPJ and CSLL) and penalties regarding the disallowance of the JCP deducted from the 2017 and 2018 taxable income, in the amount of R$5,323 (US$979 million). There was also a reduction in tax losses, with the corresponding tax impact of R$698 (US$128 million). The Company had filed administrative appeals and the decision is pending. As of September 30,2021, the likelihood of loss is possible for both tax assessments.

(b.ii) Proceeding related to income tax paid abroad:

In March 2021, Vale was assessed for the collection of R$2,171 (US$399 million) due to the disregard of taxes paid abroad that were offset by the IRPJ debt in 2016. Tax authorities allege the Company has failed to comply with the applicable rules relating to the offset, in Brazil, of income taxes paid abroad. The Company had filed an administrative appeal and a decision is pending. As at September 30, 2021, the likelihood of loss is possible.

c) Judicial deposits

	Consolidated
	September 30, 2021		December 31, 2020
Tax litigations		5,299		5,132
Civil litigations		413		441
Labor litigations		808		924
Environmental litigations		124		94
Total		6,644		6,591

d) Guarantees contracted for legal proceedings

In addition to the above-mentioned tax, civil, labor and environmental judicial deposits, the Company contracted R$12.1 billion (US$2.2 billion) in guarantees for its lawsuits.

e) ICMS included in PIS and COFINS computation tax base

Vale has been discussing the issue regarding the exclusion of ICMS in PIS and COFINS tax basis in two judicial proceedings filed before March 2017. In one of the proceedings includes refers to the taxable events from March 2012 onwards and has a definitive favorable decision (res judicata). This proceeding gave rise to the recognition of a gain in the amount of R$313 (US$63 million) in the income statement for the year ended December 31, 2020. This amount was calculated based on the thesis that the collected ICMS was supposed to be excluded from the contribution basis. With the definition of the subject by Federal Supreme Court in the leading case (RE 574.706), which is binding to all taxpayers, and has determined that the ICMS to be excluded shall be the amount stated in the invoices, the Company recognized an additional gain of R$146 (US$29 million) for the three-month period ended June 30, 2021.

The other proceeding, which covers the taxable events occurred between December 2001 and February 2012, resulted in a gain of R$808 (US$162 million) for the three-month period ended June 30, 2021, due to the favorable decision to the Company, in accordance with the recent decision of the Federal Supreme Court about the referred leading case.

Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

24. Employee benefits

a) Long-term incentive programs

For the long-term awarding of eligible executives, the Company compensation plans includes Matching program and Performance Share Unit program (“PSU”), with three years-vesting cycles, respectively, with the aim of encouraging employee’s retention and encouraging their performance.

Matching Program

For the Matching program, the participants can acquire Vale’s common shares in the market without any benefits being provided by Vale. If the shares acquired are held for a period of three years and the participants keep it employment relationship with Vale, the participant is entitled to receive from Vale an award in shares, equivalent to the number of shares originally acquired by the executive. It should be noted that, although a specific custodian of the shares is defined by Vale, the share initially purchased by the executives have no restriction and can be sold at any time. However, if it’s done before the end of the three-year-vesting period, they would lose its right of receiving the related award to be paid by Vale.

Performance Shares Units

For PSU program, the eligible executives may receive during a three year-vesting cycle an award equivalent to the market value of a determined number of common shares and depending on the Vale’s performance factor, which is measured based on indicators of the total return to the shareholders (“TSR”) and Environmental, Social, and Governance (“ESG”). It is comprised by 80% of TSR metrics and 20% of ESG indicators.

At the Annual and Extraordinary Shareholders' Meeting ("AGOE") held on April 30, 2021, the Company's shareholders approved changes in the PSU program to be implemented as from the 2021 grant, consisting of (i) a change in the payment of the program award, which will be paid with common shares of the Company, and (ii) additional payment at the end of each cycle based on the remuneration that will be paid by Vale to its stockholders during the cycle.

b) Modification altering manner of settlement

Both programs were classified as “cash-settled” due to the PSU requirements and the Company’s settlement practice for the Matching program and, therefore, presented as a liability. However, the decision taken at the AGOE (“modification date”) demonstrates the Company's declared intention to change the form of liquidation of the programs. As a result, those programs were modified to become “equity-settled” and were remeasured at the modification-date fair value.

Fair value at modification date

The fair value of the Matching program was estimated using the Company’s stock price and ADR at the modification date, which was R$109.02 and US$20.12 per share, respectively. The number of shares granted for the 2019, 2020 and 2021 cycles were 1,222,721, 2,154,534 and 1,046,255, respectively. The fair value of the program will be expensed on a straight-line basis over the three-year required service period, net of estimated forfeitures.

For the PSU, the program was measured using Monte Carlo simulations to estimate the TSR indicator and ESG indicators. The assumptions used in the Monte Carlo simulation to estimate the fair value of the TSR indicator are shown below:

PSU	2021
Granted shares		1,474,723
Date shares were granted		04/30/2021
VALE (BRL)		109.02
VALE ON (USD)		20.12
Expected volatility		39.00%p.y.
Expected dividend yield (i)		3.18%p.y.
Expected term (in years)		3
Expected value of the total shareholder return (TSR)		51.20%
Expected value of the performance factor (Total)		60.96%

(i) Source: Bloomberg April 30, 2021

Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

Reclassification from cash-settled to equity-settled

Matching	April 30, 2021		Remeasurement			Reclassification			May 1, 2021			Expense (i)			September 30, 2021
Liability		164		23			(187	)		-			-			-
Stockholders' equity		-		-			187			187			65			252
Net income		-		(23	)		-			(23	)		(65	)		(88	)

PSU	April 30, 2021		Remeasurement			Reclassification			May 1, 2021		Expense (i)			September 30, 2021
Liability		16		(5	)		(11	)		-		-			-
Stockholders' equity		-		-			11			11		14			25
Net income		-		5			-			5		(14	)		(9	)

(i) The Company has incurred in expenses in the amount of R$40 and R$8 with Matching and PAV programs, respectively, for the three-month periods ended September 30, 2021.

c) Employee post-retirement obligations

Reconciliation of net liabilities recognized in the statement of financial position

	Consolidated
	September 30, 2021								December 31, 2020
	Overfunded pension plans		Underfunded pension plans		Other benefits		Total		Overfunded pension plans		Underfunded pension plans		Other benefits		Total
Amount recognized in the statement of financial position
Present value of actuarial liabilities	(15,816	)	(22,861	)	(8,349	)	(47,026	)	(16,138	)	(24,073	)	(9,007	)	(49,218	)
Fair value of assets	19,672		21,721		-		41,393		20,626		20,744		-		41,370
Effect of the asset ceiling	(3,856	)	-		-		(3,856	)	(4,488	)	-		-		(4,488	)
Liabilities	-		(1,140	)	(8,349	)	(9,489	)	-		(3,329	)	(9,007	)	(12,336	)
Current liabilities	-		(204	)	(359	)	(563	)	-		(204	)	(499	)	(703	)
Non-current liabilities	-		(936	)	(7,990	)	(8,926	)	-		(3,125	)	(8,508	)	(11,633	)
Liabilities	-		(1,140	)	(8,349	)	(9,489	)	-		(3,329	)	(9,007	)	(12,336	)

25. Stockholders’ equity

a) Share capital

As at September 30, 2021, the share capital was R$77,300 (US$61,614 million) corresponding to 5,132,458,410 shares issued and fully paid without par value.

	September 30, 2021
Stockholders	Common shares		Golden shares		Total
Shareholders with more than 5% of total capital		2,204,322,997		-		2,204,322,997
Previ		415,366,682		-		415,366,682
Capital World Investors		335,249,101		-		335,249,101
Capital Research Global Investors		326,001,911		-		326,001,911
Bradespar		293,907,266		-		293,907,266
Mitsui&co		286,347,055		-		286,347,055
Blackrock, Inc		279,562,772		-		279,562,772
Capital International Investors		267,888,210		-		267,888,210
Others		2,687,617,480		-		2,687,617,480
Golden shares		-		12		12
Total outstanding (without shares in treasury)		4,891,940,477		12		4,891,940,489
Shares in treasury		240,517,921		-		240,517,921
Total capital		5,132,458,398		12		5,132,458,410

The information presented above is based on the communications provided by the stockholders in connection with the Instruction 358 issued by the Brazilian Securities and Exchange Commission (“CVM”).

Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

b) Share buyback program

On April 1, 2021, the Board of Directors approved a share buyback program for Vale’s common share which will be limited to a maximum of 270,000,000 common shares, and their respective ADRs, representing up to 5.3% of the total number of outstanding shares. The program was approved to be carried out over up to a 12-month period and the repurchased shares will be cancelled after the expiration of the program or utilized on the executive compensation programs (note 24). The shares are acquired in the stock market based on regular trading conditions.

As at September 30, 2021, the Company purchased 238,860,947 common shares at an average cost of US$20.28 per share (R$105.76 per share), representing R$25,261 (US$4,845 million). Of that amount, R$9,687 (US$1,837 million) or 99,842,600 shares were purchased through wholly owned subsidiaries and R$15,574 (US$3,008 million) or 139,018,347 shares directly by the parent company.

As the Company is close to reaching the limit for the buyback of shares in the current program, the Board of Directors approved on October 28, 2021 (subsequent event), a new share buyback program for Vale’s common share which will be limited to a maximum of 200,000,000 common shares, and their respective ADRs, representing up to 4.1% of the total number of outstanding shares. The program will be carried out over up to an 18-month period.

c) Treasury shares

The Company utilized 890,482 and 1,628,485 units from its treasury shares, for the share-based payment program of its executives (note 24), corresponding to R$37 (US$7 million) and R$68 (US$14 million) recognized as “Treasury shares utilized in the period” in the Statement of Changes in Equity, for the periods ended September 30, 2021 and 2020, respectively.

On September 16, 2021, the Board of Directors approved the cancellation of 152,016,372 common shares of the Company acquired in previous buyback programs and held in treasury, without reducing its capital stock.

d) Stockholder’s remuneration

On February 25, 2021, based on the Company’s dividends policy, the Board of Directors approved the stockholder’s remuneration in the amount of R$21,866 (US$3,972 million), equivalent to R$4.262386983 per share, which was fully paid on March 15, 2021. Of the total amount, R$4,288 (US$762 million) was in the form of interest on stockholders’ equity and R$17,578 (US$3,122 million) in the form of dividends.

On June 17, 2021, the Board of Directors approved an additional stockholder’s remuneration in the total amount of R$11,046 (US$2,200 million), equivalent to R$2.177096137 per share, which was fully paid on June 30, 2021. Of the total amount, R$3,634 (US$724 million) relates to the anticipation of the 2021 year-end result and R$7,412 (US$1,476 million) was paid from the balance on the Company’s profit reserves.

On September 16, 2021, the Board of Directors approved the stockholder’s remuneration in the total amount of R$40,200 (US$7,391 million), equivalent to R$8.108316476 per share, which was fully paid on September 30, 2021. The amount distributed relates to the anticipation of the 2021 year-end result.

26.

Related parties

The Company’s related parties are subsidiaries, joint ventures, associates, stockholders and its related entities and key management personnel of the Company. Transactions between the parent company and its subsidiaries are eliminated on consolidation and are not disclosed in this note.

In June 2021, the Company concluded the transaction for the acquisition of the interests held by Mitsui (related party) in Vale Moçambique and Nacala Logistics Corridor (note 12).

Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

Transactions with related parties

	Consolidated
	Three-month period ended September 30,
	2021												2020
	Joint Ventures			Associates			Stockholders			Total			Joint Ventures			Associates			Stockholders			Total
Net operating revenue		933			359			271			1,563			590			320			259			1,169
Cost and operating expenses		(1,466	)		(30	)		-			(1,496	)		(1,199	)		(37	)		-			(1,236	)
Financial result		(5	)		(3	)		(1,905	)		(1,913	)		26			(6	)		(215	)		(195	)

	Consolidated
	Nine-month period ended September 30,
	2021												2020
	Joint Ventures			Associates			Stockholders			Total			Joint Ventures			Associates			Stockholders			Total
Net operating revenue		2,769			1,042			882			4,693			1,268			897			697			2,862
Cost and operating expenses		(3,221	)		(80	)		-			(3,301	)		(3,811	)		(90	)		-			(3,901	)
Financial result		(48	)		(10	)		(4,118	)		(4,176	)		102			10			(382	)		(270	)

Purchases, accounts receivable and other assets, and accounts payable and other liabilities relate largely to amounts charged by joint ventures and associates related to the pelletizing plants operational lease and railway transportation services.

Net operating revenue relates to sale of iron ore to the steelmakers and right to use capacity on railroads. Cost and operating expenses mostly relates to the variable lease payments of the pelletizing plants and the logistics costs for using the Nacala Logistics Corridor, which has been consolidated since June 2021, as described in note 12.

Outstanding balances with related parties

	Consolidated
	September 30, 2021								December 31, 2020
	Joint Ventures		Associates		Stockholders		Total		Joint Ventures		Associates		Stockholders		Total
Assets
Cash and cash equivalents (i)		-		-		6,787		6,787		-		-		10,820		10,820
Accounts receivable		820		111		1		932		565		236		11		812
Dividends receivable		561		-		-		561		101				-		101
Loans (ii)		-		-		-		-		5,800		-		-		5,800
Derivatives financial instruments (i)		-		-		31		31		-		-		12		12
Other assets		276		17		-		293		354		8		-		362
								-
Liabilities								-
Supplier and contractors		1,492		37		268		1,797		627		54		181		862
Loans (ii)		-		-		-		-		-		7,192		4,907		12,099
Derivatives financial instruments (i)		-		-		1,494		1,494		-		-		1,255		1,255
Other liabilities		721		432		-		1,153		1,222		248		-		1,470

(i) Refers to regular financial instruments with large financial institutions that are deemed related parties.

(ii) Refers to loans settled upon completion of the NLC acquisition (note 12).

Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

27.

Selected notes to Parent Company information (individual interim information)

Other financial assets and liabilities

	Parent company
	Current		Non-Current
	September 30, 2021	December 31, 2020	September 30, 2021	December 31, 2020
Other financial assets
Restricted cash	-	-	360	20
Derivative financial instruments	343	37	127	338
Investments in equity securities	5,801	-	33	3,438
Related parties - Loans	-	-	42	42
	6,144	37	562	3,838
Other financial liabilities
Derivative financial instruments	959	1,166	3,167	3,076
Related parties - Loans	4,072	2,484	80,440	88,908
Financial guarantees	-	-	2,926	4,558
Liabilities related to the concession grant	2,130	1,088	9,012	10,928
Advance receipts	24	9	-	-
	7,185	4,747	95,545	107,470

Investments

	Parent company
	2021			2020
Balance at January 1st,		181,319			144,594
Additions and Capitalizations		598			2,039
Disposals		-			(117	)
Translation adjustment		(3,477	)		41,834
Equity results and others results from subsidiaries		(2,800	)		3,461
Equity results and other results in associates and joint ventures		1,430			(323	)
Equity results in statement of comprehensive income		2,500			(1,150	)
Equity results in statement of non controlling		(1,600	)		-
Dividends declared		741			(1,304	)
Share buyback programs (i)		(9,687	)		-
Impairment of Mineração Rio do Norte S.A.		(338	)		-
Merger (ii)		(3,546	)		(2,105	)
Others		(1,069	)		736
Balance at September 30,		164,071			187,665

(i) Refers to the share buyback program carried out by subsidiaries (note 25).

(ii) In 2021, refers to the merger of the spun-off net assets of Minerações Brasileiras Reunidas S.A., and the wholly owned subsidiaries Valesul Alumínio S.A. and Companhia Paulista de Ferro-Ligas, all approved at the Extraordinary General Meeting held on April 30, 2021. In 2020, refers to the merger of the wholly owned subsidiary Ferrous Resources do Brasil S.A., approved at the Extraordinary General Meeting held on April 30, 2020.

Intangible

	Parent company
	Concessions			Contract right		Software			Total
Balance at December 31, 2020		28,015			-		228			28,243
Additions		555			-		79			634
Disposals		(41	)		-		-			(41	)
Amortization		(868	)		-		(60	)		(928	)
Balance at September 30, 2021		27,661			-		247			27,908
Cost		33,602			-		2,703			36,305
Accumulated amortization		(5,941	)		-		(2,456	)		(8,397	)
Balance at September 30, 2021		27,661			-		247			27,908

	Parent company
	Concessions			Contract right			Software			Total
Balance at December 31, 2019		15,993			99			179			16,271
Additions		640			-			53			693
Disposals		(24	)		-			-			(24	)
Amortization		(683	)		(4	)		(43	)		(730	)
Merger of Ferrous		-			-			5			5
Balance at September 30, 2020		15,926			95			194			16,215
Cost		20,969			223			2,581			23,773
Accumulated amortization		(5,043	)		(128	)		(2,387	)		(7,558	)
Balance at September 30, 2020		15,926			95			194			16,215

Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

Property, plant and equipment

	Parent company
	Building and land			Facilities			Equipment			Mineral properties			Railway equipment			Right of use assets			Others			Constructions in progress			Total
Balance at December 31, 2020		28,299			30,567			10,232			9,016			12,713			2,115			7,065			11,331			111,338
Additions (i)		-			-			-			-			-			201			-			11,255			11,456
Disposals (ii)		(1	)		(20	)		(33	)		-			(29	)		(1,010	)		(2	)		(265	)		(1,360	)
Asset retirement obligation		-			-			-			(683	)		-			-			-			-			(683	)
Depreciation, amortization and depletion		(1,030	)		(1,238	)		(1,157	)		(524	)		(599	)		(116	)		(814	)		-			(5,478	)
Merger of MBR		434			293			277			641			25			-			104			1,226			3,000
Transfers		981			1,393			1,943			474			408			-			1,033			(6,232	)		-
Balance at September 30, 2021		28,683			30,995			11,262			8,924			12,518			1,190			7,386			17,315			118,273
Cost		40,649			44,309			22,545			12,834			19,583			1,964			16,773			17,315			175,972
Accumulated depreciation		(11,966	)		(13,314	)		(11,283	)		(3,910	)		(7,065	)		(774	)		(9,387	)		-			(57,699	)
Balance at September 30, 2021		28,683			30,995			11,262			8,924			12,518			1,190			7,386			17,315			118,273

	Parent company
	Building and land		Facilities		Equipment		Mineral properties		Railway equipment		Right of use assets		Others		Constructions in progress		Total
Balance at December 31, 2019	28,352		30,219		10,213		7,153		12,766		2,114		6,840		8,218		105,875
Additions (i)	-		-		-		-		-		163		-		6,991		7,154
Disposals	(6	)	(139	)	(8	)	(30	)	(13	)	-		(4	)	(4	)	(204	)
Asset retirement obligation	-		-		-		(247	)	-		-		-		-		(247	)
Depreciation, amortization and depletion	(909	)	(1,341	)	(1,056	)	(373	)	(678	)	(272	)	(773	)	-		(5,402	)
Merger of Ferrous Resources do Brasil S.A.	679		325		73		990		-		3		6		(136	)	1,940
Transfers	443		1,545		861		1,170		510		-		824		(5,353	)	-
Balance at September 30, 2020	28,559		30,609		10,083		8,663		12,585		2,008		6,893		9,716		109,116
Cost	37,458		41,277		19,481		11,647		18,816		2,588		15,359		9,716		156,342
Accumulated depreciation	(8,899	)	(10,668	)	(9,398	)	(2,984	)	(6,231	)	(580	)	(8,466	)	-		(47,226	)
Balance at September 30, 2020	28,559		30,609		10,083		8,663		12,585		2,008		6,893		9,716		109,116

(i) Includes capitalized borrowing costs.

(ii) The write-off of “Right of use assets” refers to the termination of the lease agreement between Vale and MBR, which was incorporated this year.

Loans and borrowings

				Parent company
				Current liabilities				Non-current liabilities
	Average interest rate (i)			September 30, 2021		December 31, 2020		September 30, 2021		December 31, 2020
Quoted in the secondary market:
Bonds		6.02	%		-		-		2,831		2,704
Eurobonds					-		-		-		4,783
Debentures		10.48	%		1,003		555		1,171		2,021
Debt contracts in Brazil in:
R$, indexed to TJLP, TR, IPCA, IGP-M and CDI		10.17	%		635		1,203		1,504		2,808
R$, with fixed interest		2.74	%		79		84		11		71
Basket of currencies and bonds in US$ indexed to LIBOR		2.32	%		121		232		-		58
Debt contracts in the international market in:
US$, with variable interest		2.23	%		680		871		8,649		7,405
Others, with variable interest		4.09	%		432		-		55		-
Accrued charges					113		369		-		-
Total					3,063		3,314		14,221		19,850

(i) In order to determine the average interest rate for debt contracts with floating rates, the Company used the rate applicable as at September 30, 2021.

The future flows of debt payments (principal) are as follows:

Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

	Parent company
	Debt principal
2021		305
2022		2,771
2023		2,326
2024		5,399
Between 2025 and 2029		1,908
2030 onwards		4,462
		17,171

Reconciliation of debt to cash flows arising from financing activities

	Parent company
	Quoted in the secondary market			Debt contracts in Brazil			Debt contracts on the international market			Total
December 31, 2020		10,396			4,471			8,297			23,164
Additions		-			-			1,633			1,633
Repayments		(5,328	)		(1,691	)		(894	)		(7,913	)
Interest paid		(755	)		(284	)		(67	)		(1,106	)
Cash flow from financing activities		(6,083	)		(1,975	)		672			(7,386	)

Effect of exchange rate		200			(341	)		843			702
Interest accretion		548			207			49			804
Non-cash changes		748			(134	)		892			1,506

September 30, 2021		5,061			2,362			9,861			17,284

Provisions

	Parent company
	Current liabilities				Non-current liabilities
	September 30, 2021		December 31, 2020		September 30, 2021		December 31, 2020
Payroll, related charges and other remunerations		2,772		3,154		-		-
Environmental obligations		340		419		708		583
Asset retirement obligations		221		323		4,844		4,405
Provision related to the Candonga Consortium (i)		392		213		-		-
Provisions for litigation		429		455		5,261		4,782
Employee postretirement obligations		269		255		3,304		3,246
Provisions		4,423		4,819		14,117		13,016

(i) As at December 31, 2020, the provision related to the Candonga Consortium was presented in the balance sheet under "Others" in the current liabilities.

Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

Provisions for litigation

	Parent company
	Tax litigation			Civil litigation			Labor litigation			Environmental litigation			Total of litigation provision
Balance at December 31, 2020		2,410			1,090			1,687			50			5,237
Additions and reversals, net		(4	)		21			303			6			326
Payments		(25	)		(111	)		(198	)		(21	)		(355	)
Indexation and interest		31			92			146			2			271
Merger (note 12)		79			125			4			3			211
Balance at September 30, 2021		2,491			1,217			1,942			40			5,690
Current liabilities		38			79			311			1			429
Non-current liabilities		2,453			1,138			1,631			39			5,261
		2,491			1,217			1,942			40			5,690

	Parent company
	Tax litigation			Civil litigation			Labor litigation			Environmental litigation		Total of litigation provision
Balance at December 31, 2019		2,325			1,004			1,734			39		5,102
Additions and reversals, net		90			96			93			7		286
Payments		(54	)		(42	)		(213	)		-		(309	)
Indexation and interest		38			75			86			2		201
Merger of Ferrous Resources do Brasil S.A.		1			3			3			2		9
Balance at September 30, 2020		2,400			1,136			1,703			50		5,289
Current liabilities		40			80			340			1		461
Non-current liabilities		2,360			1,056			1,363			49		4,828
		2,400			1,136			1,703			50		5,289

Selected Notes to the Interim Financial Statements
Expressed in millions of Brazilian reais, unless otherwise stated

Contingent liabilities

	Parent company
		September 30, 2021	December 31, 2020
Tax litigations		42,083	32,902
Civil litigations		7,129	5,522
Labor litigations		2,756	2,846
Environmental litigations		4,222	3,837
Total		56,190	45,107

Income taxes

The total amount presented as income taxes in the income statement is reconciled to the rate established by law, as follows:

	Parent company
	Nine-month period ended September 30,
	2021			2020
Income before income taxes		114,258			23,657
Income taxes at statutory rates - 34%		(38,848	)		(8,043	)
Adjustments that affect the basis of taxes:
Tax incentives		13,005			4,438
Equity results		(467	)		1,068
Others		2,914			768
Income taxes		(23,396	)		(1,769	)

Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	Vale S.A.
	(Registrant)

	By:	/s/ Ivan Fadel
Date: October 28, 2021		Head of Investor Relations