Vale (NYSE:VALE) is considering entering China’s domestic bond market through a potential Panda bond issue.
CFO Marcelo Bacci discussed the possibility during an interview with Bloomberg on Wednesday (9 September).
Panda bonds are renminbi-denominated securities issued in mainland China by foreign companies, governments, and other overseas entities.
Bacci says accessing the market would be a “natural step” for Vale because China accounts for about half of the company’s iron ore revenue.
Vale has not announced a bond issue, and no potential size, timetable, maturity, or use of proceeds was provided during the interview. However, Bacci has said a bond sale could be possible within the year.
The comments follow Brazil’s preparations for its first sovereign Panda bond issuance. The Brazilian government said in June that it was seeking to raise up to ¥5 billion ($1.04 billion) through China’s domestic market.
Brazilian Finance Minister Dario Durigan said the sovereign issue could help establish a pathway for domestic companies seeking renminbi funding and reduce their exposure to foreign exchange volatility. Vale was among the companies consulted about the initiative.
Vale is a Brazil-headquartered producer of iron ore, iron ore pellets, nickel, and copper, with mining and logistics operations across several countries.
Write to France Pinzon at Mining.com.au
Images: Vale
