Edgar Filing: Vale S.A.

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 2010

Vale S.A.

Avenida Graça Aranha, No. 26
20030-900 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 þ 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 þ

(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 þ

(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 þ

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

TABLE OF CONTENTS

Press Release

Signature Page

Financial Statements — September 30, 2010

BR GAAP

Filed at CVM and SEC on 10/27/10

Gerência Geral de Controladoria — GECOL

Vale S.A.
INDEX TO CONDENSED FINANCIAL STATEMENTS


	Nr.
Report of Independent Registered Public Accounting Firm		2

Condensed Balance Sheets as of September 30, 2010 and December 31, 2009		4

Condensed Statements of Income for the three-month periods ended September 30, 2010, and 2009 and for nine-month periods ended September 30, 2010 and 2009		5

Condensed Statements of Comprehensive Income (Deficit) for the three-month periods ended September 30, 2010, and 2009 and for the nine-month periods ended September 30, 2010 and 2009		6

Condensed Statements of Changes in Stockholders’ Equity and for the nine-month periods ended September 30, 2010 and 2009		7

Condensed Statements of Cash Flows for the nine-month periods ended September 30, 2010 and 2009		8

Condensed Statements Added Value for the nine-month periods ended September 30, 2010 and 2009		9

Notes to the Condensed Financial Statements		10

(A free translation of the original in Portuguese)

Report of Independent Accountants
on the Limited Review

To the Board of Directors and Stockholders
Vale S.A.

We have carried out a limited review of the interim condensed financial information individual and consolidated of Vale S.A. and its subsidiaries, for the period of nine-months ended September 30, 2010, comprising the condensed balance sheet in September 30, 2010 and the condensed statements of operations, changes in stockholders’ equity, comprehensive income, cash flows, value added and notes, related to the period ended September 30, 2010 and 2009, prepared under the responsibility of the Company’s management.

Our review was carried out in accordance with specific standards established by the Institute of Independent Auditors of Brazil (“Instituto de Auditures Independentes do Brasil — IBRACON, and mainly comprised: (a) inquiries of and discussions with management responsible for the accounting, financial and operating areas of the Company with regard to the main criteria adopted for the preparation of the quarterly information and (b) a review of the relevant information and of the subsequent events which have, or could have, significant effects on the financial position and operations of the Company and its subsidiaries.

Based on our limited review, we are not aware of any significant adjustments which should be made to the interim condensed financial information referred to above for it to be in accordance with the Technical Pronouncement CPC 21 — Interim Financial Reporting, applicable to the preparation of interim financial information.

As mentioned in Note 3, the Brazilian Securities Commission (“Comissão de Valores Mobiliários — CVM”) approved several Technical Pronouncements, Interpretations and Orientations issued by the Comité de Pronunciamentos Técnicos — CPC, valid for 2010, that has changed the accounting practices adopted in Brazil. These changes were adopted and disclosed by the Company in the preparation of the interim condensed financial information for the period of nine-months ended

PricewaterhouseCoopers, Rua da Candelária 65, 11°, 14°, 15° e 16°, Cjs. 1302 a 1304, Rio de Janeíro, RJ, Brasil 20091-020 Caixa Postal 949, T: (21) 3232-6112, F: (21) 2516-6319, www.pwc.com/br

Vale S.A.

September 30, 2010. The interim condensed information for the preceding periods, presented for comparative purposes, were adjusted to include the changes in accounting practices adopted in Brazil for 2010 and are being restated in accordance with CPC 23 — Accounting Policies, Changes in Accounting Estimates and Correction of Errors (“Políticas Contábeis, Mudança de Estimativa e Retificação de Erros”).

Rio de Janeiro, October 27, 2010

PricewaterhouseCoopers
Auditores Independentes
CRC 2SP000160/o-5 “F” RJ

Marcos Donizete Panassol
Contador CRC 1SP155975/o-8 “S” RJ

Condensed Financial Statements

(A free translation from the original in Portuguese, accounting principles adopted in Brazil)

Condensed Balance Sheets


Balances as of		In thousands of Reais


		Consolidated						Parent Company
	Notes	September 30, 2010			December 31, 2009 (I)			September 30, 2010			December 31, 2009 (I)
		(unaudited)						(unaudited)
Assets

Current assets
Cash and cash equivalents	6		16,949,476			13,220,599			4,628,686			1,249,980
Short term investments	7		—			6,524,906			—			—
Accounts receivable from customers			13,181,545			5,642,820			16,663,629			3,360,426
Related parties	8		162,491			144,029			1,558,529			4,359,807
Inventories	9		7,773,317			5,913,024			2,201,480			1,881,583
Recovarable taxes			2,489,145			2,684,662			1,902,274			1,880,888
Unrealized gains on derivative instruments			39,773			182,932			—			—
Advances to suppliers			551,895			872,287			525,421			751,409
Others			1,474,038			1,579,687			312,393			154,816

			42,621,680			36,764,946			27,792,412			13,638,909
Assets held for sale	10		11,473,777			—			—			—

			54,095,457			36,764,946			27,792,412			13,638,909
Non-current assets
Long-term receivables
Related parties	8		859			63,710			2,156,232			1,842,485
Loans and financing			258,454			285,894			160,392			135,906
Prepaid expenses			267,567			294,550			—			—
Judicial deposits	15		2,930,331			3,108,522			2,065,269			2,433,036
Advances to suppliers — energy			—			889,227			—			—
Deferred income tax and social contribution			2,301,551			2,760,226			1,639,250			2,049,677
Recovarable taxes			503,333			1,539,910			127,911			157,993
Unrealized gains on derivative instruments	23		1,806,798			1,506,084			1,480,965			1,097,690
Others			800,398			546,933			510,452			357,632

			8,869,291			10,995,056			8,140,471			8,074,419
Investments			4,699,889			4,589,890			88,912,744			87,894,653
Intangible assets	12		24,326,695			22,604,578			18,871,403			17,312,970
Property, plant and equipment	13		117,686,814			102,495,433			36,090,912			33,882,584
Biological assets			261,255			288,286			21,708			285,117

			146,974,653			129,978,187			143,896,767			139,375,324

Total of assets			209,939,401			177,738,189			179,829,650			161,088,652

Liabilities, and stockholders’ equity
Current liabilities
Treasury stock payable			901,499			—			901,499			—
Suppliers			6,140,599			3,848,855			3,434,042			2,382,899
Payroll and related charges			1,603,608			1,556,360			1,051,497			1,009,912
Current portion of long-term debt	—		6,310,847			5,310,606			2,213,232			2,053,280
Short-term debt	—		928,661			646,325			—			—
Related parties	8		12,711			33,468			5,760,837			7,342,680
Taxes payable and royalties			495,467			255,915			139,745			97,317
Provision for income taxes			1,249,331			366,132			772,497			—
Employees postretirement benefits			378,636			292,756			223,524			160,740
Railway sub-concession agreement payable			550,174			496,262			—			—
Unrealized losses on derivative instruments	23		155,606			263,595			—			—
Provision for asset retirement obligations	16		137,659			157,048			101,212			121,485
Dividends payable			711,148			2,907,283			711,148			2,907,283
Interest on mandatorily convertible notes			237,288			275,527			—			—
Others			1,912,683			1,063,145			556,536			466,129

			21,725,917			17,473,277			15,865,769			16,541,725
Liabilities directly associated with assets held for sale	10		5,141,878			—			—			—

			26,867,795			17,473,277			15,865,769			16,541,725
Non-current liabilities
Pension Plan	17		3,060,371			3,099,313			471,865			636,496
Long-term debt	14		36,489,046			36,132,427			14,727,587			12,071,905
Related parties	8		109,474			103,164			25,101,024			28,110,935
Provisions for contingencies	15		3,760,896			4,201,617			2,212,688			2,730,560
Deferred income tax and social contribution			12,847,032			9,306,370			2,880,736			1,320,215
Unrealized losses on derivative instruments	23		70,246			39,676			—			—
Provision for asset retirement obligations	16		2,127,078			1,930,752			797,410			724,037
Debentures			1,671,340			1,306,258			1,671,340			1,306,258
Others			3,414,607			2,579,794			1,875,204			1,888,406

			63,550,090			58,699,371			49,737,854			48,788,812
Redeemable noncontroling interest			1,128,337			1,272,314			—			—

			64,678,427			59,971,685			49,737,854			48,788,812
Stockholders’ equity
Preferred class A stock — 7,200,000,000 no-par-value shares authorized and 2,108,579,618 (2009 — 2,108,579,618) issued			19,650,141			18,469,222			19,650,141			18,469,222
Common stock — 3,600,000,000 no-par-value shares authorized and 3,256,724,482 (2009 — 3,256,724,482) issued			30,349,859			28,964,971			30,349,859			28,964,971
Mandatorily convertible notes — common shares			453,275			2,584,393			453,275			2,584,393
Mandatorily convertible notes — preferred shares			1,017,172			2,002,618			1,017,172			2,002,618
Treasury stock — 72,577,171 (2009 — 77,581,904) preferred and 35,722,394 (2009 — 74,997,899) common shares			(2,921,658	)		(2,470,698	)		(2,921,658	)		(2,470,698	)
Results of noncontrolling operations			685,035			—			685,035			—
Transaction cost of issuance of shares			1,867,210			(160,771	)		1,867,210			(160,771	)
Equity adjustments			202,713			81,485			202,713			81,485
Cumulative translation adjustments			(9,753,003	)		(8,886,380	)		(9,753,003	)		(8,886,380	)
Undistributed retained earnings			72,675,283			55,173,275			72,675,283			55,173,275

Total Company stockholders’ equity			114,226,027			95,758,115			114,226,027			95,758,115
Noncontrolling interests			4,167,152			4,535,112			—			—

Total stockholders’ equity			118,393,179			100,293,227			114,226,027			95,758,115

Total liabilities and stockholders’ equity			209,939,401			177,738,189			179,829,650			161,088,652


(I)		period adjusted by new CPC’s accounting pronouncements, for comparative purposes, according to note 3.

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

(A free translation from the original in Portuguese, accounting principles adopted in Brazil)

Condensed Statements of Income


Period ended in (unaudited)		In thousands of Reais (except as otherwise stated)


		Consolidated												Parent Company
		Three-month						Nine-month						Nine-month
		September 30,			September 30,			September 30,			September 30,			September 30,			September 30,
	Notes	2010			2009 (I)			2010			2009 (I)			2010			2009 (I)
Operating revenues, net of discounts, returns and allowances
Ore and metals			21,350,712			10,800,999			46,974,316			29,758,033			34,014,050			18,732,013
Aluminum products			1,082,163			1,010,237			3,377,973			3,036,091			384,679			327,460
Logistic services			1,119,516			665,965			2,514,710			1,784,198			1,079,011			803,404
Fertilizer products			1,242,237			218,833			1,765,059			621,166			346,990			218,833
Steel products			274,634			135,770			754,447			412,798			—			—
Others			609,062			376,225			1,345,256			1,203,087			247,117			257,905

Net operating revenues			25,678,324			13,208,029			56,731,761			36,815,373			36,071,847			20,339,615

Cost of products and services
Ores and metals			(5,783,566	)		(4,929,263	)		(15,734,755	)		(14,548,061	)		(10,871,176	)		(8,378,247	)
Aluminum products			(901,806	)		(1,017,784	)		(2,859,346	)		(3,173,012	)		(833,487	)		(395,167	)
Logistic services			(540,888	)		(444,552	)		(1,551,511	)		(1,295,437	)		(751,531	)		(592,986	)
Fertilizer products			(1,170,830	)		(91,194	)		(1,554,178	)		(228,199	)		(221,046	)		(91,194	)
Steel products			(274,377	)		(122,845	)		(703,457	)		(381,080	)		—			—
Others			(332,448	)		(366,029	)		(968,242	)		(924,428	)		(106,809	)		(218,891	)

			(9,003,915	)		(6,971,667	)		(23,371,489	)		(20,550,217	)		(12,784,049	)		(9,676,485	)


Gross profit			16,674,409			6,236,362			33,360,272			16,265,156			23,287,798			10,663,130


Operating expenses
Selling, general and administrative expenses			(780,217	)		(569,799	)		(2,009,557	)		(1,651,796	)		(1,066,646	)		(833,849	)
Research and development expenses			(387,064	)		(438,163	)		(1,059,635	)		(1,441,322	)		(774,338	)		(940,906	)
Others	22		(891,994	)		(647,102	)		(2,643,524	)		(2,266,572	)		(678,078	)		(641,084	)

			(2,059,275	)		(1,655,064	)		(5,712,716	)		(5,359,690	)		(2,519,062	)		(2,415,839	)


Operating profit			14,615,134			4,581,298			27,647,556			10,905,466			20,768,736			8,247,291

Equity results			(56,183	)		30,262			(12,015	)		93,733			5,444,317			(4,076,787	)
Financial results, net			64,725			190,181			(2,287,772	)		2,444,273			(1,321,365	)		9,217,358
Gain (loss) on disposal of assets			—			128,555			—			424,277			—			406,622

Income before income tax and social contribution			14,623,676			4,930,296			25,347,769			13,867,749			24,891,688			13,794,484


Income tax and social contribution
Current			(4,724,053	)		(1,396,582	)		(6,458,621	)		(5,840,420	)		(5,165,830	)		(5,607,208	)
Deferred			753,800			(448,936	)		1,543,473			(298,110	)		563,665			(557,497	)

	11		(3,970,253	)		(1,845,518	)		(4,915,148	)		(6,138,530	)		(4,602,165	)		(6,164,705	)

Net income from continuing operations			10,653,423			3,084,778			20,432,621			7,729,219			20,289,523			7,629,779

Net income from discontinued operations	5		14,610			—			(221,708	)		—			(221,708	)		—

Net income			10,668,033			3,084,778			20,210,913			7,729,219			20,067,815			7,629,779


Net income attributable to noncontrolling interests			114,345			97,949			143,098			99,440			—			—
Net income attributable to the Company’s stockholders			10,553,688			2,986,829			20,067,815			7,629,779			20,067,815			7,629,779


Basic and diluted earnings per share attributable to Company’s stockholders:
Earnings per preferred share			1.97			0.56			3.80			1.43			3.80			1.43
Earnings per common share			1.97			0.56			3.80			1.43			3.80			1.43
Earnings per preferred share linked to convertible mandatorily notes (*)			1.97			0.56			3.80			0.90			3.80			0.90
Earnings per common share linked to convertible mandatorily notes (*)			1.97			0.56			3.80			1.22			3.80			1.22


*()**		basic earnings per share only, as dilution assumes conversion.

(I)		period adjusted by new CPC’s accounting pronouncements, for comparative purposes, according to note 3.

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

(A free translation from the original in Portuguese, accounting principles adopted in Brazil)



3- Condensed Statements of Comprehensive Income (deficit) Period ended in (unaudited)		In thousands of Reais (Except as otherwise stated)


	Consolidated
	Three-month						Nine-month
	September 30,			September 30,			September 30,			September 30,
	2010			2009 (I)			2010			2009 (I)
Comprehensive income (deficit) is comprised as follows:
Company’s stockholders:
Net income attributable to Company’s stockholders		10,553,688			2,986,829			20,067,815			7,629,779
Cumulative translation adjustments		(1,022,347	)		(1,834,961	)		(866,623	)		(8,253,507	)

Unrealized gain (loss) — available-for-sale securities
Gross balance as of the period/year end		(72,625	)		(109,222	)		(66,756	)		(1,842	)
Tax (expense) benefit		—			—			(6,327	)		—

		(72,625	)		(109,222	)		(73,083	)		(1,842	)

Cash flow hedge
Gross balance as of the period/year end		7,201			28,122			313,666			30,121
Tax (expense) benefit		(50,289	)		(5,926	)		(119,355	)		(5,926	)

		(43,088	)		22,196			194,311			24,195

Total comprehensive income attributable to Company’s stockholders		9,415,628			1,064,842			19,322,420			(601,375	)

Noncontrolling interests:
Net income attributable to noncontrolling interests		114,345			97,949			143,098			99,440
Cumulative translation adjustments		(72,302	)		96,629			(78,948	)		(1,373,247	)
Cash flow hedge		—			—			63,033			—

Total comprehensive income (deficit) attributable to Noncontrolling interests		42,043			194,578			127,183			(1,273,807	)

Total comprehensive income (deficit)		9,457,671			1,259,420			19,449,603			(1,875,182	)


(I)		period adjusted by new CPC’s accounting pronouncements, for comparative purposes, according to note 3.

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

(A free translation from the original in Portuguese, accounting principles adopted in Brazil)

Condensed Statements of Changes in Stockholders’ Equity


Period ended in (unaudited)		In thousands of Reais


				Translation
				cost of			Gain on					Mandatorily																Cumulative						Total company
				issuance			conversion in		Treasury			convertible			Expansion /			Unrealized				Tax			Equity			translation			Retained			stockholders’			Noncontrolling			Stockholders’
	Notes	Capital		of share			shares		stock			notes			Investments			profit		Legal		incentives			adjustments			adjustments			earnings			equity			interests			equity

On December 31, 2008			47,434,193		(160,771	)		—		(2,448,490	)		3,063,833			38,883,814			38,521		3,383,677		89,844			7,945			5,982,074			—			96,274,640			—			96,274,640

Initial adjustments for adoption of new accounting principles	3		—		—			—		—			—			—			—		—		—			—			—			33,431			33,431			4,691,278			4,724,709
Reclassification of cumulative translation adjustments			—		—			—		—			—			—			—		—		—			—			(5,982,074	)		5,982,074			—			—			—


On January 1, 2009 (l)			47,434,193		(160,771	)		—		(2,448,490	)		3,063,833			38,883,814			38,521		3,383,677		89,844			7,945			—			6,015,505			96,308,071			4,691,278			100,999,349

Net income for the period			—		—			—		—			—			—			—		—		—			—			—			7,629,779			7,629,780			99,440			7,729,219
Treasury stock			—		—			—		(22,208	)		—			—			—		—		—			—			—			—			(22,208	)		—			(22,208	)
Adjustments for adoption on new principles for comparison	3		—		—			—		—			—			—			—		—		—			—			—			(101,357	)		(101,358	)		—			(101,358	)
Additional remuneration of mandatorily convertible notes			—		—			—		—			1,523,178			—			—		—		—			—			—			—			1,523,178			—			1,523,178
Unrealized result of market value			—		—			—		—			—			—			—		—		—			(1,842	)		—			—			(1,842	)		—			(1,842	)
Cumulative translation adjustments			—		—			—		—			—			—			—		—		—			—			(8,253,507	)		—			(8,253,507	)		(1,373,247	)		(9,626,754	)
Cash flow hedge			—		—			—		—			—			—			—		—		—			24,195			—			—			24,195			—			24,195
Capital increase			—		—			—		—			—			—			—		—		—			—			—			—			—			424			424


On September 30, 2009 (l)			47,434,193		(160,771	)		—		(2,470,698	)		4,587,011			38,883,814			38,521		3,383,677		89,844			30,298			(8,253,507	)		13,543,927			97,106,309			3,416,404			100,522,713


On January 1, 2010			47,434,193		(160,771	)		—		(2,470,698	)		4,587,011			45,166,589			—		3,896,124		209,497			81,485			(8,886,380	)		5,901,065			95,758,115			4,535,112			100,293,227

Net income for the period			—		—			—		—			—			—			—		—		—			—			—			20,067,815			20,067,815			143,098			20,210,913
Capitalized reserves			2,565,807		—			—		—			—			(2,434,824	)		—		—		(130,983	)		—			—			—			—			—			—
Gains on conversion in shares			—		2,027,981			—		1,035,852			(3,063,833	)		—			—		—		—			—			—			—			—			—			—
Treasury stock			—		—			—		(1,486,812	)		—			—			—		—		—			—			—			—			(1,486,812	)		—			(1,486,812	)
Cumulative translation adjustments			—		—			—		—			—			—			—		—		—			—			(866,623	)		—			(866,623	)		(78,948	)		(945,571	)
Cash flow hedge			—		—			—		—			—			—			—		—		—			194,311			—			—			194,311			63,033			257,344
Unrealized result of market value			—		—			—		—			—			—			—		—		—			(73,083	)		—			—			(73,083	)		—			(73,083	)
Non-controlling shareholders’ interest			—		—			—		—			—			—			—		—		—			—			—			—			—			(143,630	)		(143,630	)
Additional remuneration of mandatorily convertible notes			—		—			—		—			(52,731	)		—			—		—		—			—			—			—			(52,731	)		—			(52,731	)
Assets and Liabilities held for sale			—		—			—		—			—			—			—		—		—			—			—			—			—			(3,207,153	)		(3,207,153	)
Acquisitions			—		—			685,035		—			—			—			—		—		—			—			—			—			685,035			2,855,640			3,540,675


On September 30, 2010			50,000,000		1,867,210			685,035		(2,921,658	)		1,470,447			42,731,765			—		3,896,124		78,514			202,713			(9,753,003	)		25,968,880			114,226,027			4,167,152			118,393,179


(I)		period adjusted by new CPC’s accounting pronouncements, for comparative purposes, according to note 3.

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

(A free translation from the original in Portuguese, accounting principles adopted in Brazil)

Condensed Statements of Cash Flows


Period ended in (unaudited)		In thousands of Reais


	Consolidated						Parent Company
	Accumulated						Accumulated
	September 30,			September 30,			September 30,			September 30,
	2010			2009 (I)			2010			2009 (I)
Cash flows from operating activities:
Net income for the period		20,210,913			7,729,219			20,067,815			7,629,779
Adjustments to reconcile net income to cash from operations:
Equity in results of investment		12,015			(93,733	)		(5,444,317	)		4,076,787
Sale of assets		—			(424,277	)		—			(406,622	)
Discontinued operations, net of tax		221,708			—			221,708			—
Depreciation, amortization and depletion		3,946,919			3,997,975			1,497,304			1,499,413
Deferred income tax and social contribution		(1,543,473	)		298,110			(563,665	)		557,497
Foreing indexation and exchange losses (gains), net		821,615			(4,795,107	)		(348,728	)		(8,746,041	)
Loss on disposal of property, plant and equipment		704,871			476,317			2,344,905			337,521
Unrealized derivative losses (gains), net		115,332			(2,282,105	)		(97,025	)		(2,001,749	)
Dividends/interest received		146,938			21,318			783,033			293,817
Others		548,127			(90,256	)		618,094			(10,667	)

Decrease (increase) in assets:
Accounts receivable		(7,365,036	)		1,721,651			(14,346,295	)		3,912,881
Inventories		(1,565,057	)		2,951,592			(56,553	)		698,936
Advances to energy suppliers		—			15,879			—			—
Recovarable taxes		209,495			(331,011	)		235,298			2,081,476
Others		6,144			(640,762	)		(444,070	)		234,532

Increase (decrease) in liabilities:
Suppliers and contractors		2,205,528			(1,426,540	)		1,298,118			195,374
Payroll and related charges		10,061			(67,180	)		41,585			9,269
Income taxes		2,495,232			1,028,632			1,599,406			1,257,908
Others		611,094			759,934			669,502			777,228


Net cash provided by operating activities		21,792,426			8,849,656			8,076,115			12,397,339


Cash flows from investing activities:
Short term investments		6,524,906			(2,716,256	)		—			—
Loans and advances receivable		(96,474	)		(994,478	)		3,125,108			(31,935	)
Guarantees and deposits		(354,910	)		(164,546	)		(287,506	)		(103,794	)
Additions to investments		(105,150	)		(1,389,689	)		(1,621,069	)		(6,581,411	)
Additions to property, plant and equipment		(14,349,844	)		(11,212,848	)		(6,262,726	)		(5,157,284	)
Proceeds from disposal of investments/property, plant and equipment		—			907,543			4,432,517			602,683
Acquisition of subsidiaries, net of cash acquired		(11,377,793	)		(4,245,775	)		—			—

Net cash used in investing activities		(19,759,265	)		(19,816,049	)		(613,676	)		(11,271,741	)

Cash flows from financing activities:
Short-term debt, additions		4,040,104			3,178,808			3,938,815			56,817
Short-term debt, repayments		(3,992,613	)		(2,867,603	)		(7,890,936	)		(4,711,339	)
Long-term debt		6,408,147			3,412,486			3,032,339			1,276,710
Issue of convertible notes, in common share’s		—			577,056			—			—
Issue of convertible notes, in preferred share’s		—			1,281,035			—			—

Repayments:
Related parties		—			—			—			(120,416	)
Financial institutions		(2,951,102	)		(689,676	)		(380,639	)		(406,341	)
Transaction of noncontrolling interest		1,118,172			—			—			—
Dividends and interest attributed to Company’s stockholders		(2,303,638	)		(2,734,500	)		(2,198,000	)		(2,734,500	)
Treasury stock		(585,313	)		(22,208	)		(585,313	)		(22,208	)

Net cash provided by (used in) financing activities		1,733,757			2,135,398			(4,083,734	)		(6,661,277	)


Increase (decrease) in cash and cash equivalents		3,766,918			(8,830,995	)		3,378,706			(5,535,679	)
Cash and cash equivalents of cash, beginning of the period		13,220,599			24,639,245			1,249,980			6,712,705
Effect of exchange rate changes on cash and cash equivalents		(38,041	)		(247,654	)		—			—

Cash and cash equivalents, end of the period		16,949,476			15,560,596			4,628,686			1,177,026


Cash paid during the period for:
Interest on short-term debt		(28,704	)		(87,238	)		(63,345	)		(108,045	)
Interest on long-term debt		(1,436,031	)		(1,763,626	)		(1,193,866	)		(1,770,525	)
Income tax and social contribution		(1,685,322	)		(894,254	)		(1,559,906	)		(217,065	)
Non-cash transactions:
Additions to property, plant and equipment — interest capitalized		(462,253	)		(281,678	)		(70,605	)		(10,617	)
Transfer of advance for future capital increase to investments		—			—			—			(291,950	)
Conversion of mandatorily convertible notes using 75,435,238 treasury stock (see notes 20 and 21)


(I)		period adjusted by new CPC’s accounting pronouncements, for comparative purposes, according to note 3.

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

(A free translation from the original in Portuguese, accounting principles adopted in Brazil)

6-Condensed Statements of Added Value


Period ended in (unaudited)		In thousands of Reais


	Consolidated						Parent Company
	Accumulated						Accumulated
	September 30,			September 30,			September 30,			September 30,
	2010			2009 (I)			2010			2009 (I)
Generation of added value
Gross revenue
Revenue from products and services		58,386,558			37,774,919			37,228,333			20,945,442
Revenue from the construction of own assets		13,353,753			8,321,656			6,285,530			4,885,567
Allowance for doubtful accounts		(18,433	)		(10,463	)		(11,972	)		(6,273	)
Less: Acquisition of products		(1,319,220	)		(888,062	)		(924,213	)		(191,069	)
Outsourced services		(7,761,990	)		(4,861,705	)		(4,774,368	)		(1,865,700	)
Materials		(13,776,301	)		(13,241,594	)		(6,701,128	)		(8,229,215	)
Fuel oil and gas		(2,717,325	)		(2,011,291	)		(1,203,320	)		(814,000	)
Energy		(1,589,920	)		(1,277,608	)		(835,136	)		(508,295	)
Other costs		(6,786,420	)		(4,827,805	)		(2,930,159	)		(2,126,997	)


Gross added value		37,770,702			18,978,047			26,133,567			12,089,460

Depreciation, amortization and depletion		(3,946,919	)		(3,997,975	)		(1,497,304	)		(1,499,413	)

Net added value		33,823,783			14,980,072			24,636,263			10,590,047

Received from third parties

Financial revenue		368,819			740,145			598,877			532,077
Equity results		(12,015	)		93,733			5,444,317			(4,076,787	)


Total added value to be distributed		34,180,587			15,813,950			30,679,457			7,045,337


Personnel		3,776,264			3,728,670			2,188,928			1,721,878
Taxes, rates and contribution		2,621,671			(78,341	)		1,900,307			214,256
Current income tax		6,458,621			5,840,420			5,165,830			5,607,208
Deffered income tax		(1,543,473	)		298,110			(563,665	)		557,497
Remuneration on third party’s capital		2,889,901			2,368,828			2,184,012			2,422,807
Foreign indexation and exchange gain, net		(233,310	)		(4,072,956	)		(263,770	)		(11,108,088	)
Net income attributable to the company’s stockholders		20,067,815			7,629,779			20,067,815			7,629,779
Net income attributable to noncontrolling interests		143,098			99,440			—			—


Distribution of added value		34,180,587			15,813,950			30,679,457			7,045,337


(I)		period adjusted by new CPC’s accounting pronouncements, for comparative purposes, according to note 3.

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

(A free translation from the original in Portuguese, accounting principles adopted in Brazil)

Notes to the Condensed Financial Statements

(In thousands of Reais, except as otherwise stated)

1- Operational Context

Vale S.A, (“Vale” or the “Company”) is a Public Limited Liability Company with its headquarters in the city of Rio de Janeiro, state of Rio de Janeiro, Brazil, whose main activities through Vale, its direct and indirect subsidiaries and jointly controlled companies are mining, base metals production, fertilizers, logistics and steel activities.

At September 30, 2010, our principal consolidated operating subsidiaries are the following:

% voting

Companies

% ownership

capital

Location

Principal activity

Subsidiaries

Alumina do Norte do Brasil S.A. — Alunorte (*)

57.03

59.02

Brazil

Alumina

Alumínio Brasileiro S.A. — Albras (*)

51.00

Brazil

Aluminum

Compañia Mienera Misky Mayo S.A.C

40.00

51.00

Peru

Fertilizers

Ferrovia Centro-Atlântica S. A

99.99

Brazil

Logistic

Ferrovia Norte Sul S.A

100.00

Brazil

Logistic

Mineração Corumbaense Reunida S.A

100.00

Brazil

Iron ore

PT International Nickel Indonesia Tbk

59.14

Indonesia

Nickel

Vale Australia Pty Ltd.

100.00

Australia

Coal

Vale Colombia Ltd

100.00

Colombia

Coal

Vale Fertilizantes S.A (formely Fosfértil)

78.90

99.81

Brazil

Fertilizers

Vale Fosfatados S.A

100.00

Brazil

Fertilizers

Vale Canada Limited (formely Vale Inco)

100.00

Canada

Nickel

Vale International S.A

100.00

Switzerland

Trading

Vale Manganês S.A.

100.00

Brazil

Manganese and Ferroalloys

Vale Manganese France

100.00

France

Ferroalloys

Vale Manganese Norway

100.00

Norway

Ferroalloys

Vale Nouvelle-Caledonie SAS

74.00

New Caledonia

Nickel

Jointly-controlled companies

California Steel Industries, Inc.

50.00

Estados Unidos

Steel

Mineração Rio do Norte S.A.

40.00

Brazil

Bauxita

MRS Logística S.A

41.50

37.86

Brazil

Logistic

Samarco Mineração S.A.

50.00

Brazil

Minério de ferro


(*)		Classified as current assets held for sale.

2- Summary of the Condensed Financial Statements and of the Principal Accounting Principles

The condensed quarterly financial statements were prepared under CPC 21 — Interim Financial Reporting and based on the Brazilian Corporate Law (new wording by Law 11.638), Law 11.941, the standards, guidelines and interpretations issued by the Accounting Standards Committee — “CPC” and by the Securities and Exchange Commission of Brazil — “CVM”.

On January 1, 2010, the Company adopted from retrospectively to January 1, 2009, for comparison purposes all the Accounting Standards issued by CPC and approved by CVM. So, financial results previously disclosed have being revised as if the accounting principles had been applied in all prior periods. Except as described in note 3, the quarterly financial statements followed the principles, methods and uniform criteria in relation to those adopted in the last fiscal year ended in December 31, 2009 and therefore should be read together with these.

In preparing the financial statements, we are required to use estimates to account for certain assets, liabilities revenues and expenses. The condensed financial statements therefore include various estimates concerning the selection of useful lives of property, plant and equipment, impairment, provisions necessary for contingent liabilities and other similar evaluations. The actual amounts for the quarter periods are not necessarily indicative of the actual results expected for the full fiscal year ending December 31, 2010.

The monetary rights and obligations denominated in foreign currencies are translated at the prevailing exchange rates at the time the balance sheet date, of which US$ 1,00 equal to R$ 1,6942 on September 30, 2010 (US$ 1,00 equal to R$ 1,7412 on December 31, 2009), for monetary items. For non monetary items valued at cost, Vale uses the exchange rate at the day of the transaction or average exchange rate of the month and for non monetary items measured at fair value, Vale uses the exchange rate at the day of the transaction. Monetary rights and obligations in Brazilian currency are financially updated using contractual indexes.

Vale evaluated subsequent events until October 27, 2010, report of the condensed financial statements.

3- Adoption of new principles and accounting estimates

During 2009, The Company adopted the Standards issued by Accounting Standards Committee — “CPC” that became mandatory for adoption for the reporting statements ending on December 31, 2010 and for the parent Company since the first quarter of 2010. The Company made the necessary adjustments in the financial statements for the quarters ended September 30, 2009 and December 31, 2009, as follows:

•

CPC 15 Business Combinations — which aims to improve the relevance, reliability and comparability of information that an entity provides in its financial statements about a business combination and its effect on the assets acquired and liabilities assumed. During the initial adoption process we did not identify any significant adjustment.

•

CPC 16 Inventories — the objective of this Standard is to determine the measurement of inventories purchased for resale, the ones held for consumption or industrial use or in services rendered, work in-process and finished goods ready for sale. During the initial adoption process we did not identify any significant adjustment.

•

CPC 18 Investment in subsidiaries and affiliates — the objective of this Standard is to specify how the investments in affiliates should be accounted in the consolidated financial statements and in the financial statements of the Parent Company. During the initial adoption process we did not identify any significant adjustment.

•

CPC 19 Investment in Controlled Joint Venture — the objective of this Standard is to specify how to account for interests in jointly controlled ventures (joint ventures) and the distribution of assets, liabilities, revenues and expenses of these enterprises in the financial statements of the investees. During the initial adoption process we did not identify any significant adjustment.

•

CPC 20 Borrowing Costs — the objective of this Standard is the capitalization of the borrowing costs that are directly attributable to the acquisition, construction or production of assets, taking part of the cost of such assets. During the initial adoption process we did not identify any significant adjustment.

•

CPC 21 Interim Financial Statements — the objective of this Standard is to establish the minimum disclosure of an interim financial statement and the principles for recognition and measurement of complete and condensed interim financial statements. The Company has adopted this standard in January 1, 2010, according to note 2.

•

CPC 22 Segment Information — the objective of this Standard is to provide the disclosure that will enable users of the financial statements to assess the nature and financial effects of business activities in which the Company is involved and the economic environments in which it operates. The Company discloses in their annual statements the segment information and on March 31, 2010, the Company started disclosing comparative information, having no material change in relation to accounting records.

•

CPC 23 Accounting Policies — Changes in Estimates and Error Correction, the objective of this standard is to define criteria for selecting and changing accounting policies, together with the accounting treatment and disclosure of change in accounting policies, changes in accounting estimates and correction of error, as well as to improve the relevance and reliability of financial statements of the entity, and to enable comparability over time with the financial statements of other entities. The Company discloses in its financial statements at the end of each fiscal year, all accounting policies adopted by it, and any change or new address, follow all the decisions and guidelines for adoption. Therefore, in line with CPC 21 and CPC 23, the Company is disclosing all policies that have being changed with the adoption of CPCs.

•

CPC 24 Subsequent Events — the objective of this Statement is to determine when the entity must adjust its financial statements with respect to the subsequent events to the accounting period which refers these statements, the information that the entity must disclose about the date on which the authorization is granted to issue the financial statements and the subsequent events following the accounting period related to these statements, and establish that the entity should not prepare its financial statements based on the continuity assumption if events after the accounting period related to the statements indicate that the continuity assumption is not appropriate. The Company has adopted this approach in their statements.

•

CPC 25 Provisions, Contingent Liabilities and Contingent Assets — the goal is to establish criteria to be applied for recognition and measurement basis to correct measurement of provisions, liabilities and contingent assets and that sufficient information is disclosed in the notes to allow users to understand their nature, timeliness and value. The Company adopts this standard in their financial statements.

•

CPC 26 Presentation of Financial Statements — the goal is to define the basis for presentation of the financial statements to ensure comparability both with the financial statements for prior periods with the same entity as the financial statements of other entities. In this scenario, this standard establishes general requirements for the submission of financial statements, establishes guidelines for their structure and minimum requirements of content. The Company will adopt this standard for the complete annual financial statements in December 31, 2010.

•

CPC 27 Properties, Plant and Equipment — the goal is to establish the accounting treatment for fixed assets, so that users of financial statements can differentiate information about the entity’s investment in its fixed assets, and its variances. The main points to consider in accounting for fixed assets are the recognition of assets, the determination of their carrying amount, their depreciation (useful life) and assessing the need for recognition of impairment for losses to be recognized. The Company and its subsidiaries have been practicing the guidance in this standard.

•

CPC 29 Biological Assets and Agricultural Product — the goal is to establish the accounting treatment, and their disclosures relating to biological assets and agricultural products. The Company has in its financial records these assets, and during the initial adoption process we did not identify any significant adjustment.

•

CPC 30 Revenue — the objective of this Standard is to establish criteria for the accounting treatment of revenue from certain types of transactions and events. It must be recognized when it is probable that future economic benefits will flow to the entity and these benefits can be reliably measured. The Company adopts this standard in their financial statements.

•

CPC 31 Non-Current Assets Held for Sale and Discontinued Operations — the objective of this Standard is to establish the accounting of non-current assets held for sale with the presentation and disclosure of discontinued operations. In particular, the Standard requires that assets which meet the criteria for classification as held for sale are measured at lower of book value or the fair value less cost to sell. The depreciation or amortization of the assets ceases and the assets are presented separately in the balance sheet and the results of discontinued operations are presented separately in the income statement. The Company adopted this guidance.

•

CPC 32 Income Taxes — the objective of this Technical Standard is to prescribe the accounting treatment for taxes on income. The term tax on profit and includes all taxes and foreign national contributions are based on taxable profits. The term tax on profit also includes income taxes, such as withholding, which are due by the entity itself, through a subsidiary, affiliate or joint venture in which it participates. The effects relating to changes of due to the standard are the table of adjustment for adoption of new practices and accounting estimates.

•

CPC 33 Employee Benefits — the objective of this Standard is to address the accounting and disclosure for employee benefits. This requires the entity to recognize a liability when the employee renders service in exchange for benefits to be paid in the future, and an expense when the entity uses the economic benefit from the service received by the employee. The Company has in its financial statements, accounting records relating to events related to employee benefits, including events related to post-employment benefits and other post-employment benefits. The effects relating to changes of the standard are presented in the table of adjustments for adoption of new practices and accounting estimates.

•

CPC 36 Consolidated Financial Statements — the objective of this Standard is to increase the relevance, reliability and comparability of information that the parent Company provides in its financial statements, and the entities that are under control. It specifies the circumstances in which the entity should consolidate the financial statements of another entity (a subsidiary), the treatment in changes in ownership, in loss of controlling interest and the information that must be evidenced to enable users of financial statements to assess the nature of the relationship between the entity and its subsidiaries. The effects relating to changes of this standard are presented in the table of adjustments for adoption of new practices and accounting estimates.

•

CPC 37 Initial adoption of International Accounting Standards — the objective of this Standard, basically applied to the consolidated financial statements, is to ensure that the first consolidated financial statements of an entity in accordance with International Accounting Standards issued by the IASB — International Accounting Standards Board (IFRSs - International Financial Reporting Standards) and the disclosures accounting for the interim periods covered by such financial statements contain high quality information and have the same net income and stockholders’ equity, except in exceptional situations. The Company is adopting this standard in January 1, 2010, and comparing to January 1, 2009. The statements (note for the first adoption, with the appropriate reconciliations) will be released on December 31, 2010, compared to 2009.

•

CPC 38 Financial Instruments: Recognition and Measurement, CPC 39 Financial Instruments: Presentation and CPC 40 Financial Instruments: Disclosure. The goal of the CPC 38 is to establish principles for recognizing and measuring financial assets, financial liabilities and some contracts of buy and sell non-financial items. The goal of the CPC 39 is to establish principles for presenting financial instruments as liabilities or equity and for offsetting financial assets and liabilities. Applying the classification of financial instruments, from the perspective of the issuer, into financial assets, financial liabilities and equity instruments, the classification of their interest, dividends, losses and gains, and the circumstances in which financial assets and financial liabilities should be offset. The goal of the CPC 40 is to require the entity to disclose in its financial statements what allows users to evaluate the significance of the financial instrument for the financial position and performance of the entity and the nature and extent of risks arising from financial instruments to which the entity is exposed during the period and the end of the accounting period, and how the entity manages those risks. The Company already adopted the concepts and requirements in accordance with this standard. During the initial adoption process, the relevant effects were identified, and described in the table of adjustments for adoption of new practices and accounting estimates.

•

CPC 41 Earning per Share — the objective of this standard is to establish principles for measurement and disclosure of earnings per share, in order to improve performance comparisons between different companies in the same period, as well as for the same Company at different periods. Even tough earnings per share information has been limited because of different accounting principles used to determine the results of the period, a consistent denominator improve the presentation of the financial reports. The standard focuses on the denominator of the earning per share calculation. The standard shoul be applied to the consolidated and individual financial statements of the Company in which common shares or potential common shares are publicly traded (national and foreign stock exchange or informal trade market, including local and regional market), or Companies that had been registered or that are in process of registering in the CVM or other official regulator, with the purpose of distribute common shares or potential common shares in the formal market. Normally, earning per share is calculated in a common shares context and so is deliberate by deducing the earnings attributable to the preferred shares’ owners from the results of the period. However certain preferred shares are equivalent to common shares in the Brazilian scenario (even in others countries), the standard establish that everything related to calculation and disclosure of the basic and diluted earning per common share is applicable to the calculation and disclosure of the basic and diluted earning per preferred share, by class, independent of your categorization as capital or debt, if the shares are being traded or in process to be traded at formal markets. The Company adopted this guidance.

In addition to these standards, we also adopt the respective interpretations, instructions and guidelines applicable as follows:

•

CVM 485 instruction (alter the CVM 457 instruction) — provides for the preparation and disclosure of consolidate financial statements, according to the international accounting standards issued by the International Accounting Standards Board — IASB. The consolidated financial statements to the public companies should be prepared in accordance with the international pronouncements and standards issued by the Account Standard Committee (Comite de Pronunciamentos Contabeis — CPC) and Securities and Exchange Commission (Comissao de Valores Mobiliarios — CVM). The public Companies should disclosure into the explanatory notes to the consolidated financial statements an explicit note and without reserves that the financial statements are in accordance with the international accounting standards issue by IASB and also in accordance with the accounting principles adopted in Brazil. The Company adopted this guidance.

•

ICPC 01 Grant Contracts — the objective of this interpretation is to guide the grantee about the accounting for public services concession to private entities. This interpretation is applicable to concession if the grantor has the control over which services the grantee has to provide regarding infrastructure, to whom must provide the services, its price or whatever relevant residual interest existing up to concession deadline. Also is applicable to the existing or acquired infrastructure by the grantee from third parties. The Company begun to recognize those assets into intangible assets, not recording, in this moment, any financial asset for understanding that there is no unconditional evidence of receiving from the Grantor for those assets.

•

ICPC 13 Participation Rights from Decommissioning, Restoration and Environmental Rehabilitation Funds — the purpose of the decommissioning fund is to segregate assets for defray any or all costs of assets decommissioning. The contributions to the fund can be voluntaries or required by law or regulation. The funds can present established structure by a single or multiple payers to pay its individual or joint obligations. The payer should record a liability for your obligation to pay decommissioning expenses and must record your fund interest separately, except if the payer is not responsible for paying the decommissioning expenses even if the fund fails to pay. If the payer does not has the control, joint control or any significant influence over the fund, should recognize the rights to receive reimbursement from the fund as reimbursement and to measure at the lower between the obligation and the portion of the payer recognized the fair value of net assets of the fund attributable to payers. The changes in book value of the rights to receive reimbursement, except the fund contributions, should be recorded in the results for the period that changes occurred. The Company does not have this kind of fund, and its assets are accounted under other accounting pronouncements.

For the periods covered by the first financial statements in accordance with the new principles, the Company has evaluated the new rules and as a result of the adoption of the standards relevant to their initial balances has made adjustments in the intermediate and comparative statements as follows:

•

Employee benefits (CPC 33) — the Company made early records in employee benefit plans immediately recognized an increase in liabilities with the offset in deferred income tax assets and in equity. In these adjustments also are included gains and losses relating to previous accounting policy, which would fall within the limits of the “corridor” practices adopted by the Company for recognition of actuarial gains and losses from employees benefit plans in the previous principles, which continued to being adopted for new principles.

•

Provision for assets retirement obligation (CPC 25) — the entries made for the initial adoption of this statement; refer to the differences between the historical interest rates on long-term used in previous and use in new items for the calculation of the discounted present value of obligations for asset retirement.

•

Financial instruments (CPC 38) — the entries made for the initial adoption of this standard are related to the additional remuneration of mandatorily convertible securities, debt remuneration, and additional dividends.

•

Leasing — the Company recognized as fixed assets with an offset in loans and financing, the amount due to leasing contracts previously classified as operational leasing.

•

Deferred income tax — the adjustments in this account refer basically a transfer of the shares recorded as current assets to non-current liabilities, according to CPC 26. The amount comprises with a tax loss of the parent Company of R$397,109 September 30, 2010 against R$799,243 December 31, 2009, and expects to realize it even in 2010.

•

Minority interest — this line is now called Non-controlling shareholders’ participation and was assigned to Equity in accordance with CPC 26 and CPC 36. The participation of non-controlling shareholders, recorded in Equity requires that the movement of items of those shareholders occur in a similar way as those submitted to the controlling shareholders.

•

Redeemable non-controlling shareholders — the participation of non-controlling shareholders that is redeemable upon the occurrence of certain events beyond the control of the Company was classified as shares of redeemable non-controlling shareholders in non-current liabilities.

Adjustments of the Adoption of New Accounting Practices and Estimates


	Consolidated												Parent Company
							Minority			Stockholders’							Stockholders’
	Assets			Liabilities			interest			equity			Assets		Liabilities		equity
Opening balance of new international accounting principles on January 1, 2009
Balance prior to the adoption of new principles		184,845,948			82,489,987			6,081,319			96,274,640			171,759,376		75,484,736		96,274,640

Employee Benefits		102,817			108,208			—			(5,391	)		102,817		302,402		(199,585	)
Assets Retirement Obligation		(48,169	)		(87,843	)		—			39,674			—		—		—
Leasing		18,437			19,289			—			(852	)		—		—		—
Deferred Income Taxes		(429,936	)		(429,936	)		—			—			—		—		—
Investments		—			—			—			—			233,016		—		233,016
Judicial deposits		1,126,238			1,126,238			—			—			861,791		861,791		—

Adjustments to the new accounting practices on January 1, 2009		769,387			735,956			—			33,431			1,197,624		1,164,193		33,431


Equity of controlled shareholders											96,308,071
Noncontrolling shareholders’ participation — OCI		—			—			(4,691,278	)		4,691,278			—		—		—
Redeemable noncontrolling shareholders		—			1,390,041			(1,390,041	)		—			—		—		—

Balance on January 1, 2009 with the new principles		185,615,335			84,615,984			—			100,999,349			172,957,000		76,648,929		96,308,071


	Consolidated															Parent Company
On September 30, 2009							Minority			Stockholders’												Stockholders’
— 3nd quarter of 2009	Assets			Liabilities			interest			equity			Net result			Assets			Liabilities			equity			Net result
Balance prior to the adoption of new principles		175,305,572			73,541,419			4,598,841			97,165,312			3,003,301			159,333,942			62,168,630			97,165,312			3,003,301

Accumulated prior period adjustments		920,541			975,495			—			(54,954	)		—			1,214,449			1,269,403			(54,954	)		—

		176,226,113			74,516,914			4,598,841			97,110,358			3,003,301			160,548,391			63,438,033			97,110,358			3,003,301

Employee Benefits		(2,167	)		(8,615	)		—			6,448			(9,242	)		(2,167	)		(6,373	)		4,206			4,206
Assets Retirement Obligation		86,305			96,764			—			(10,459	)		(7,185	)		—			—			—			—
Leasing		(1,555	)		(1,517	)		—			(38	)		(45	)		—			—			—			—
Deferred Income Taxes		70,809			70,809			—			—			—			—			—			—			—
Investments		—			—			—			—			—			(8,255	)		—			(8,255	)		(20,677	)
Judicial deposits		4,017			4,017			—			—			—			62,077			62,077			—			—

Adjustments to the new accounting principles of 3Q09		157,409			161,458			—			(4,049	)		(16,472	)		51,655			55,704			(4,049	)		(16,471	)


Equity of controlled shareholders								—			97,106,309			2,986,829
Accumulated prior period adjustments		—			—			(3,213,495	)		3,213,495			—			—			—			—			—
Noncontrolling shareholders’ participation — OCI		—			—			(202,909	)		202,909			97,949			—			—			—			—
Redeemable noncontrolling shareholders		—			1,182,437			(1,182,437	)		—			—			—			—			—			—

Balance on 09/30/09 with the new principles		176,383,522			75,860,809			—			100,522,713			3,084,778			160,600,046			63,493,737			97,106,309			2,986,830


	Consolidated															Parent Company
							Minority			Stockholders’												Stockholders’
On December 31, 2009 — 4Q09	Assets			Liabilities			interest			equity			Net result			Assets			Liabilities			equity			Net result
Balance in 12/31/09 prior to the adoption of new principles		175,738,728			74,194,328			5,807,426			95,736,974			2,628,094			159,757,929			64,020,955			95,736,974			2,628,094
Adjustments to prior quarters		1,077,950			1,136,953			—			(59,003	)		—			1,266,104			1,325,107			(59,003	)		—

		176,816,678			75,331,281			5,807,426			95,677,971			2,628,094			161,024,033			65,346,062			95,677,971			2,628,094

Employee Benefits		(11,537	)		(108,509	)		—			96,972			3,824			(11,537	)		(33,932	)		22,395			22,395
Assets Retirement Obligation		(67,200	)		(49,846	)		—			(17,354	)		16,651			—			—			—			—
Additional Remuneration of Mandatorily Convertible Securities		—			—			—			—			59,062			—			—			—			—
Leasing		(1,323	)		(1,849	)		—			526			(25	)		—			—			—			—
Deferred Income Taxes		1,537,654			1,537,654			—			—			—			—			—			—			—
Investments		—			—			—			—			—			57,749			—			57,749			57,117
Judicial deposits		(536,083	)		(536,083	)		—			—			—			18,407			18,407			—			—

Adjustments to the new accounting practices of 4Q09		921,511			841,367			—			80,144			79,512			64,619			(15,525	)		80,144			79,512

Equity of controlled shareholders											95,758,115			2,707,606
		—			—			(3,416,404	)		3,416,404			—			—			—			—			—
Noncontrolling shareholders’ participation — OCI		—			—			(1,118,708	)		1,118,708			68,489			—			—			—			—
Redeemable noncontrolling shareholders		—			1,272,314			(1,272,314	)		—			—			—			—			—			—

Balance on 12/31/09 with the new principles		177,738,189			77,444,962			—			100,293,227			2,776,095			161,088,652			65,330,537			95,758,115			2,707,606

4- Principles and Consolidation Practices

The quarterly condensed consolidated financial statements reflect the balances of assets, liabilities and shareholders’ equity at September 30, 2010 and December 31, 2009 and the operations for the quarters ended September 30, 2010 and 2009 of the parent Company and its direct and indirect subsidiaries and shared control. Overseas operations are translated into the reporting currency of financial statements in Brazil and are accounted for under equity, full or proportional consolidation of financial statements.

Vale participation in hydroelectric projects in Brazil is done through consortium contracts under which the Company participates in assets and liabilities of enterprises in proportion to the share holding of the power generated. The Company has no joint liability for any obligation. Since there is no legal entity for the project, there are no stand alone, income tax, net income and equity. Brazilian law clearly states that no separate entity as a result of the consortium contract. Thus, Vale recognizes the proportionate share of costs and undivided interests in assets related to hydroelectric projects.

5- Acquisitions and Disposals

a) Fertilizars Business

In line with the strategy of the Company to become a leading global player in the fertilizer business, on May 27, 2010, Vale acquired 58.6% of the equity capital of Vale Fertilizantes S.A. (formely Fosfértil) and the Brazilian fertilizer assets of Bunge Participações e Investimentos S.A. (BPI) for a total of R$ 8,692,537 in cash. An additional payment was done in July 2010 in the amount of R$ 102,845 as an add to purchase price of Vale Fosfatados.

Information about the purchase price allocation presented below based on the fair values of identified assets acquired and liabilities assumed is preliminary. Such allocation, currently being performed internally by the Company, will be finalized during future periods, and accordingly, the preliminary purchase price allocation information set forth below is subject to revision, which may be material.


Purchase price	8,692,537
Noncontrolling interest (*)	3,316,930
Book value of assets acquired and liabilities assumed, net	(4,395,902	)
Adjustment to fair value of property, plant and equipment	(9,307,406	)
Adjustment to fair value of inventories	(180,761	)
Deferred taxes on the above adjustments	3,225,977


Goodwill	1,351,375


(*)		Noncontrolling interests consideration is caculated based on the option contract and maket prices for the remaning noncontrolling interest.

As part of this acquisition, on September 29, 2010, the Company exercised an option contract to acquire additional 20.27% stake in Fosfertil, for US$1.0 billion (equivalent in September 30, 2010 to R$ 1,753 million). Also, Vale launched a mandatory offer to acquire the 0.19% of the common shares held by the noncontrolling shareholders.

If the acquisition of these assets had been completed on January 1, 2010, our net income would increased by R$ 80.159 and our net revenues would increase by R$ 829.010.

The goodwill balance arises primarily due to the synergies between the acquired assets and the potash operations in Taquari-Vassouras, Caranalita, Rio Colorado and Neuquém and phosphates in is Bayóvar I and II, in Peru, and Evate, in Mozambique. The future development of our projects combined with the acquisition of the portfolio of fertilizer assets will allow Vale to be one of the top players in the world fertilizer business.

b) Other transactions

In September 2010, Vale required 51% state in Sociedade de Desenvolvimento do Corredor Norte S.A. (SDCN) for US$20 million (equivalent to R$34 million in September 30, 2010). The SDCN has the concession to create a logistic infrastructure necessary for production flow resulting from the second phase of our Moatize Project.

As part of the Company efforts to meet the future production targets, the Company acquired 51% interest on iron ore concession rights in Simandou South (Zogota), Guinea and iron ore exploration permits in Simandou North. From this amount, R$ 900,750 is payable immediately and the remaining US$ 2 billion (equivalent to R$ 3,388 million in September 30, 2010) upon achievement of specific milestones. This joint venture is also committed to renovate 660 km of the Trans-Guinea railway for passenger transportation and light commercial use.

In July, 2010, Vale concluded the sale of minority stakes in the Bayóvar project in Peru through the newly-formed company MVM Resources International B.V. (MVM). The Company sold 35% of the total capital of MVM to Mosaic for R$ 682,181 and 25% to Mitsui for R$ 487,272 Vale retains control of the Bayóvar project, holding 40% stake of the total capital of the newly-formed company. The capital amount invested as at June 30, 2010 was approximately US$550,000 (equivalent to R$ 931,810 million in September 30, 2010). The gain on this transaction will be accounted for in equity in accordance with the accounting rules related to the gains/losses when control is retained.

In June, 2010, Vale acquired an additional 24.5% stake in the Belvedere coal project (Belvedere) for R$ 167,946 from AMCI Investments Pty Ltd (AMCI). As an outcome of this transaction, the Company increased its participation in Belvedere from 51.0% to 75.5%.

In May, 2010, Vale entered into agreement with Oman Oil Company S.A.O.C. (OOC), a company wholly-owned by the Government of the Sultanate of Oman, to sell 30% of Vale Oman Pelletizing Company LLC (VOPC), for US$ 125 million (equivalent to R$ 212 million in September 30, 2010). The transaction remains subject to the terms set forth in the definite share purchase agreement to be signed after the fulfillment of precedent conditions.

Vale has entered into negotiations and agreements to sell Kaolin, aluminum and alumina assets. For further details see note 10.

6- Cash and cash equivalents

Consolidated

Parent Company

September 30, 2010

(unaudited)

December 31, 2009

(unaudited)

December 31, 2009

Cash

1,199,262

1,405,352

30,800

85,693

Short-term investments

15,750,214

11,815,247

4,597,886

1,164,287

16,949,476

13,220,599

4,628,686

1,249,980

All the above mentioned time deposits represent low risk investments. Part of them is denominated in Brazilian Reais indexed to the CDI rate, and part denominated in US dollars.

7- Short-Term Investments


	Consolidated
	September 30, 2010 (unaudited)		December 31, 2009
Time deposits (*)		—		6,524,906


(*)		Represent low-risk investments, with redemption date between 91 and 360 days, investments with less time are classified as cash and cash equivalents.

8- Related parties

In the Company’s normal course of business, Vale enters into transactions with related parties regarding products and services, leasing of assets, loans under normal market conditions, raw material and rail transport services.

The balances of related parties transactions, and its effects in the quarterly information, can be identified as follows:


	Consolidated
	Assets
	September 30, 2010 (unaudited)				December 31, 2009
	Customers		Related Parties		Customers		Related Parties
Baovale Mineração S.A		3,188		—		—		—
Companhia Coreano-Brasileira de Pelotização — KOBRASCO		324		210		—		—
Companhia Hispano-Brasileira de Pelotização — HISPANOBRÁS		79,913		134		29,297		136
Companhia Ítalo-Brasileira de Pelotização — ITABRASCO		339		—		1,042		—
Korea Nickel Corporation		—		—		18,922		—
MRS Logistica S.A.		829		360		—		—
Samarco Mineração S.A		43,527		6,343		10,298		37,418
Teal Minerals Incorporated		—		79,419		—		140,000
Others		102,996		76,884		32,431		30,185

Total		231,116		163,350		91,990		207,739


Registered as:
Current		231,116		162,491		91,990		144,029
Long-term		—		859		—		63,710

		231,116		163,350		91,990		207,739


	Consolidated
	Liabilities
	September 30, 2010 (unaudited)				December 31, 2009
	Suppliers		Related Parties		Suppliers		Related Parties
Baovale Mineração S.A		23,034		—		—		—
Companhia Coreano-Brasileira de Pelotização — KOBRASCO		82,654		1,069		4,712		1,912
Companhia Hispano-Brasileira de Pelotização — HISPANOBRÁS		71,935		1,102		27,861		1,051
Companhia Ítalo-Brasileira de Pelotização — ITABRASCO		2,724		—		4,783		—
Companhia Nipo-Brasileira de Pelotização — NIBRASCO		115,293		—		8,307		9,518
Minas da Serra Geral		5,378		10,540		8,068		14,236
Mineração Rio do Norte S.A.		13,341		—		25,839		—
MRS Logistica S.A.		218,800		109,355		309,783		109,376
Others		90,460		119		119,496		539

Total		623,619		122,185		508,849		136,632


Current		623,619		12,711		508,849		33,468
Long-term		—		109,474		—		103,164

		623,619		122,185		508,849		136,632


	Parent Company
	Asset
	September 30, 2010 (unaudited)				December 31, 2009
	Customers		Related Parties		Customers		Related Parties
ALUNORTE — Alumina do Norte do Brasil S.A.		24,900		48,909		33,071		71,526
Baovale Mineração S.A		6,376		3,323		—		—
Companhia Portuária Baía de Sepetiba — CPBS		1,867		155,940		—		—
CVRD OVERSEAS Ltd.		1,933,964		146		544,802		174
Ferrovia Centro — Atlântica S.A.		29,117		118,002		59,134		68,075
Companhia Hispano-Brasileira de Pelotização — HISPANOBRÁS		79,325		273		59,555		12
Minerações Brasileiras Reunidas S.A. — MBR		1,968		551,052		6,033		686,804
MRS Logistica S.A.		1,065		22,317		1,277		6,018
Salobo Metais S.A.		2,585		233,555		3,499		233,555
Samarco Mineração S.A		87,054		167,847		20,596		74,836
Vale International S.A.		13,568,126		1,586,965		1,672,019		4,652,712
Vale Manganês S.A.		18,137		182,059		36,022		181,205
Others		154,285		644,373		169,792		227,375

Total		15,908,769		3,714,761		2,605,800		6,202,292


Current		15,908,769		1,558,529		2,605,800		4,359,807
Non-current		—		2,156,232		—		1,842,485

		15,908,769		3,714,761		2,605,800		6,202,292


	Parent Company
	Liabilitie
	September 30, 2010 (unaudited)				December 31, 2009
	Suppliers		Related Parties		Suppliers		Related Parties
ALUNORTE — Alumina do Norte do Brasil S.A.		13,208		—		15,732		—
Baovale Mineração S.A		46,068		—		38,790		—
Companhia Portuária Baía de Sepetiba — CPBS		218,273		2,522		30,185		2,319
CVRD OVERSEAS Ltd.		4		220,799		4		490,955
Ferrovia Centro — Atlântica S.A.		15,454		—		14,101		1,583
Companhia Coreano-Brasileira de Pelotização — KOBRASCO		165,308		—		9,424		—
Companhia Hispano-Brasileira de Pelotização — HISPANOBRÁS		63,979		2,245		56,732		2,140
Minerações Brasileiras Reunidas S.A. — MBR		26,667		264,044		30,203		87,628
MRS Logistica S.A.		262,296		—		433,122		—
Companhia Nipo-Brasileira de Pelotização — NIBRASCO		214,090		21,203		16,953		21,199
Salobo Metais S.A.		10,000		—		16,200		—
Vale International S.A.		3,488		30,330,813		41,740		34,807,832
Others		82,937		20,235		142,400		39,959

Total		1,121,772		30,861,861		845,586		35,453,615


Current		1,121,772		5,760,837		845,586		7,342,680
Non-current		—		25,101,024		—		28,110,935

		1,121,772		30,861,861		845,586		35,453,615


	Consolidated
	Three months (unaudited)
	Income				Cost and expenses				Financial
	September 30,		September 30,		September 30,		September 30,		September 30,			September 30,
	2010		2009		2010		2009		2010			2009
Baovale Mineração S.A.		3,199		—		4,524		4,124		—			—
Companhia Coreano-Brasileira de Pelotização — KOBRASCO		—		—		64,289		63,511		186			(148	)
Companhia Hispano-Brasileira de Pelotização — HISPANOBRÁS		62,463		17,364		36,031		138,579		(640	)		1,848
Companhia Ítalo-Brasileira de Pelotização — ITABRASCO		—		—		3,502		59,915		67			(1,570	)
Companhia Nipo-Brasileira de Pelotização — NIBRASCO		—		—		16,947		90,242		85			(69	)
Log-in S.A.		—		—		—		—		—			—
Mineração Rio do Norte S.A		11		16		30,590		65,613		94			53
MRS Logistica S.A.		4,778		4,060		154,279		191,559		(3,324	)		(26,091	)
Samarco Mineração S.A.		110,820		20,868		—		—		6			(31	)
Others		4,005		1,370		9,268		6,649		(7,976	)		1,319

		185,276		43,678		319,430		620,192		(11,502	)		(24,689	)


	Consolidated
	Accumulated (unaudited)
	Income				Cost and expenses				Financial
	September 30,		September 30,		September 30,		September 30,		September 30,			September 30,
	2010		2009		2010		2009		2010			2009
Baovale Mineração S.A.		7,187		3,054		13,570		13,751		—			—
Companhia Coreano-Brasileira de Pelotização — KOBRASCO		—		—		82,359		—		259			(786	)
Companhia Hispano-Brasileira de Pelotização — HISPANOBRÁS		187,594		26,136		200,256		19,386		93			(9	)
Companhia Ítalo-Brasileira de Pelotização — ITABRASCO		—		—		12,257		11,729		143			(2,236	)
Companhia Nipo-Brasileira de Pelotização — NIBRASCO		—		64		37,145		34,202		195			(521	)
Log-in S.A.		7,475		13,945		—		—		(63	)		382
Mineração Rio do Norte S.A		28		16		105,059		191,530		(51	)		92
MRS Logistica S.A.		12,630		9,336		431,042		388,281		(16,257	)		(26,091	)
Samarco Mineração S.A.		263,381		50,435		—		—		55			(96	)
Usinas Siderúrgicas de Minas Gerais S.A. — USIMINAS (*)		—		108,982		—		—		—			—
Others		4,152		9,031		34,388		32,698		4,550			(180	)

		482,447		220,999		916,076		691,577		(11,076	)		(29,445	)


	Parent Company
					Accumulated (unaudited)
	Income				Cost and expenses				Financial
	September 30,		September 30,		September 30,		September 30,		September 30,			September 30,
	2010		2009		2010		2009		2010			2009
ALBRAS — Alumínio Brasileiro S.A.		31,877		90,738		—		—		—			—
ALUNORTE — Alumina do Norte do Brasil S.A.		95,978		282,188		35,849		90,092		(7	)		(20,811	)
Baovale Mineração S.A.		5,586		5,264		9,046		27,502		—			—
Companhia Coreano-Brasileira de Pelotização — KOBRASCO		—		—		128,579		66,031		371			(1,572	)
Companhia Hispano-Brasileira de Pelotização — HISPANOBRÁS		175,229		56,293		280,456		39,475		(8,681	)		(3,274	)
Companhia Ítalo-Brasileira de Pelotização — ITABRASCO		—		—		14,265		23,883		477			(1,283	)
Companhia Nipo-Brasileira de Pelotização — NIBRASCO		—		—		161,330		69,801		341			57,069
Companhia Portuária Baia de Sepetiba — CPBS		—		—		88,673		206,139		(60	)		(6,609	)
CVRD Overseas Ltd.		2,276,813		1,859,608		—		—		(88,599	)		123,717
Ferrovia Centro — Atlântica S.A.		45,042		149,916		32,240		6,524		5,026			3,454
MRS Logistica S.A.		5,761		13,477		261,368		663,729		(3,684	)		—
Samarco Mineração S.A.		221,607		100,870		—		—		12			(193	)
Usinas Siderúrgicas de Minas Gerais S.A. — USIMINAS (*)		—		89,381		—		—		—			—
Vale Energia S.A.		303		—		132,207		134,753		—			—
Vale International S.A.		12,608,113		15,029,189		—		—		1,149,514			7,863,582
Vale Manganês S.A.		20,044		45,582		—		—		6			(1,440	)
Others		8,489		1,178		11,587		16,138		9,289			3,192

		15,494,842		17,723,684		1,155,600		1,344,067		1,064,005			8,015,832


(*)		Sold in April 2009.

Additionally, on September 30, 2010 Vale has outstanding balances with Banco Nacional de Desenvolvimento Social and BNDES Participações S.A. in the amounts of R$ 3,239,585 and R$ 1,188,070, respectively, related to loans at market interest rates, maturing up to September, 2029. These operations are booked as “Loans and Financing”.

On September 30, 2010, Vale also has short-term investments with Bradesco in the amount of R$ 17,254.


	September 30, 2010
	(unaudited)
Remuneration of key management personnel

Short-term benefits to management		65,439
Other long-term benefits to management		18,428

Total		83,867

9- Inventories


	Consolidated				Parent Company
	September 30, 2010				September 30, 2010
	(unaudited)		December 31, 2009		(unaudited)		December 31, 2009
Finished products
Nickel (co-products and by-products)		3,290,882		1,885,788		106,848		56,531
Iron ore and pellets		1,334,590		1,324,230		1,133,633		999,797
Manganese and ferroalloys		380,010		289,538		—		—
Fertilizers		335,329		—		15,751		—
Aluminum products (*)		—		251,169		—		1,094
Kaolin (*)		—		73,402		—		—
Coal		165,805		89,187		—		—
Copper concentrate		51,234		60,754		51,234		60,754
Steel products		42,254		24,776		—		—
Others		204,110		13,528		98,328		29,782

		5,804,214		4,012,372		1,405,794		1,147,958
Spare parts and maintenance supplies		1,969,103		1,900,652		795,686		733,625

		7,773,317		5,913,024		2,201,480		1,881,583


(*)		Classified as held for sale in September, 2010 (see note 10).

10- Assets and liabilities held for sale

•

Aluminium

In connection with our strategy of active portfolio asset management, Vale entered entered in May 2010 into an agreement with Norsk Hydro ASA (Hydro), to sell all our stakes in Albras — Alumínio Brasileiro S.A. (Albras), Alunorte — Alumina do Norte do Brasil S.A. (Alunorte) and Companhia de Alumina do Pará (CAP), 60% of the Paragominas bauxite mine and all our other Brazilian bauxite mineral rights (“Aluminum Business”).

For the Vale’s interest in Albras, Alunorte and Cap, the Company will receive US$ 405 million in cash, and net debts assumption in the amount of US$ 700 million for the Hydro, and 22% of Hydro’s share capital. By Vale’s interest in Paragominas of 60% and for the mining rights, the Company will receive the amount of US$ 600 million. The company will sell 40% of Paragominas in two tranches of US$ 200 million in cash.

The company has assessed that the expected fair value of the transaction is higher than the net asset carrying value and accordingly has maintained the original amounts. Also, because of the significant influence the company will hold on Hydro, aluminum was not considered a discontinued operation.

•

Kaolin

As part of our portfolio management, we have entered into negotiations with the intention to sell our net assets of linked to kaolin activities. In August 2010, we sold part of our Kaolin’s assets and measured these remaining assets at fair value less costs to sell and the total loss in operation is being recognized in discontinued operations, net of tax.

As of September 30, 2010, detailed amounts of these assets and liabilities classified as held for sale are as follows:


	Consolidated
Assets held for sale
Property, plant and equipment		8,091,363
Advances to suppliers — energy		841,590
Inventories		706,064
Recoverable taxes		1,023,853
Other assets		810,907

Total		11,473,777


Liabilities associated with assets held for sale
Non-controlling interests		3,207,153
Long-term debt		1,222,962
Suppliers		211,484
Other		500,279

Total		5,141,878

11- Income Tax and Social Contribution

Income taxes in Brazil comprise federal income tax and social contribution. The statutory composite enacted tax rate applicable in the periods presented is 34%. In other countries where we have operations, we are subject to various tax rates, depending of consolidation.

The amount reported as income tax and social contribution result in the consolidated financial statements is reconciled to the statutory rates, as follows:


	Consolidated												Parent Company
	Three-month period ended in
	(unaudited)						Accumulated (unaudited)						Accumulated (unaudited)
	September 30,			September 30,			September 30,			September 30,			September 30,			September 30,
	2010			2009 (I)			2010			2009 (I)			2010			2009 (I)
Income before income tax and social contribution		14,623,676			4,930,296			25,347,769			13,867,749			24,891,688			13,794,484
Results of equity investment and goodwill amortization		56,183			(30,262	)		12,015			(93,733	)		(5,444,317	)		4,076,787
Tax effect on non taxable functional currency		1,327,547			1,457,641			239,747			9,711,291			—			—

		16,007,406			6,357,675			25,599,531			23,485,307			19,447,371			17,871,271

Income tax and social contribution at combined tax rates		34	%		34	%		34	%		34	%		34	%		34	%
Federal income tax and social contribution at statutory rates		(5,442,518	)		(2,161,610	)		(8,703,841	)		(7,985,004	)		(6,612,106	)		(6,076,233	)

Adjustments that affects the basis of taxes:
Income tax benefit from interest on stockholders’ equity		363,380			—			1,110,700			—			1,110,700			—
Fiscal incentives		458,601			62,116			968,267			254,806			763,603			168,696
Results of overseas companies taxed by different rates wich diference than the parent company rate		765,670			273,062			1,767,644			1,356,309			—			—
Others		(115,386	)		(19,086	)		(57,918	)		235,359			135,638			(257,168	)

Income tax and social contribution		(3,970,253	)		(1,845,518	)		(4,915,148	)		(6,138,530	)		(4,602,165	)		(6,164,705	)


(I)		period adjusted by new CPC’s accounting pronouncements, for comparative purposes, according to note 3.

12- Intangibles


			Consolidated				Parent Company
	September 30, 2010				September 30, 2010
Intangible	(unaudited)		December 31, 2009		(unaudited)		December 31, 2009
Concession and subsoncession		14,461,060		14,143,035		9,608,674		9,460,707
Goodwill on acquisitions		8,614,035		7,180,763		8,614,035		7,180,763
Right of use		636,757		654,723		636,757		654,723
Others		614,843		626,057		11,937		16,777

		24,326,695		22,604,578		18,871,403		17,312,970

13- Property, Plant and Equipment


				Consolidated									Parent Company
											December 31,									December 31,
	Average			September 30, 2010 (unaudited)							2009 (I)		September 30, 2010 (unaudited)							2009 (I)
	depreciation					Accumulated									Accumulated
	rates			Cost		Depreciation			Net		Net		Cost		Depreciation			Net		Net
Lands		—			542,993		—			542,993		477,304		343,226		—			343,226		272,174
Buildings		2	%		9,544,846		(1,918,938	)		7,625,908		6,062,720		3,397,784		(862,774	)		2,535,010		2,331,492
Installations		4	%		25,992,095		(8,547,073	)		17,445,022		19,340,065		13,821,883		(4,596,178	)		9,225,705		9,752,380
Equipment		8	%		18,898,334		(7,194,943	)		11,703,391		8,918,026		5,415,747		(2,087,453	)		3,328,294		3,442,026
Information technology equipment		20	%		2,564,074		(1,592,685	)		971,389		812,992		2,035,700		(1,359,277	)		676,423		667,047
Mineral rights		5	%		42,167,310		(4,738,732	)		37,428,578		23,967,860		3,457,004		(450,382	)		3,006,622		1,531,351
Others		7	%		16,397,736		(3,447,708	)		12,950,028		11,232,093		3,559,658		(1,745,594	)		1,814,064		1,548,349

					116,107,388		(27,440,079	)		88,667,309		70,811,060		32,031,002		(11,101,658	)		20,929,344		19,544,819
Construction in progress					29,019,505		—			29,019,505		31,684,373		15,161,568		—			15,161,568		14,337,765

Total					145,126,893		(27,440,079	)		117,686,814		102,495,433		47,192,570		(11,101,658	)		36,090,912		33,882,584


(I)		period adjusted by new CPC’s accounting pronouncements, for comparative purposes, according to note 3.

14- Loans and Financing

Current


	Consolidated
	September 30, 2010 (unaudited)		December 31, 2009
Trade finance		765,493		545,851
Working capital		163,168		100,474

		928,661		646,325

Refers to short-term debt denominated in US dollars, with average annual interest rate of 2.16% per year.

Non-current


	Consolidated								Parent Company
	Current liabilities				Non current				Current liabilities				Non current
	September 30,				September 30,				September 30,				September 30,
	2010		December 31,		2010		December 31,		2010		December 31,		2010		December 31,
	(unaudited)		2009 (I)		(unaudited)		2009 (I)		(unaudited)		2009 (I)		(unaudited)		2009 (I)
Foreign operations

U.S. dollars		3,925,647		2,850,615		4,559,871		10,688,409		212,958		276,267		1,685,285		1,095,104
Other currencies		33,472		50,963		330,079		715,112		5,512		5,982		2,715		5,982

U.S. dollars		—		—		17,330,998		12,851,649		—		—		—		—
Euro		—		—		1,732,801		—		—		—		1,732,801		—
Export securitization (*)		—		261,173		—		—		—		—		—		—
Perpetual notes		—		—		132,446		136,120		—		—		—		—
Accrued charges		354,242		346,128		—		—		56,050		6,644		—		—


		4,313,361		3,508,879		24,086,195		24,391,290		274,520		288,893		3,420,801		1,101,086

Indexed by TJLP, TR, IGP-M and CDI		164,370		145,231		6,481,309		6,233,293		108,553		107,891		6,091,908		5,975,944
Basket of currencies		4,812		2,450		133,777		5,104		2,386		2,450		9,277		5,105
Loans in U.S. dollars		529		—		4,577,054		989,770		—		—		1,205,601		989,770
Non-convertible debentures		1,500,000		1,500,000		1,210,711		4,512,970		1,500,000		1,500,000		4,000,000		4,000,000
Accrued charges		327,775		154,046		—		—		327,773		154,046		—		—


		1,997,486		1,801,727		12,402,851		11,741,137		1,938,712		1,764,387		11,306,786		10,970,819


Total		6,310,847		5,310,606		36,489,046		36,132,427		2,213,232		2,053,280		14,727,587		12,071,905


(I)		period adjusted by new CPC’s accounting pronouncements, for comparative purposes, according to note 3.

(*)		Refers to debt securities collateralized by future receivables arising from certain exports sales.

Long-term portions as of September 30, 2010 matures as follows:


	Consolidated				Parent Company
2011		352,922	1	%		71,778	1	%
2012		2,142,243	6	%		465,874	3	%
2013		5,712,824	16	%		4,470,689	30	%
2014		2,033,694	5	%		1,520,838	10	%
2015 onwards		25,537,864	70	%		8,198,408	56	%
No due date		709,499	2	%		—	0	%

		36,489,046	100	%		14,727,587	100	%

As of September 30, 2010, annual interest rates on long-term debt were as follows:


	Consolidated		Parent Company
Up to 3%		9,390,488		3,121,353
3,1% to 5%		3,864,661		1,790,878
5,1% to 7% (*)		15,294,640		1,223,560
7,1% to 9% (*)		5,275,723		2,016,824
9,1% to 11%		4,330,918		4,150,909
Over 11% (*)		4,504,440		4,637,295
Variable		139,023		—

		42,799,893		16,940,819


(*)		Includes Eurobonds. For this operation we have entered into derivative transactions at a cost of 4,71%% per year in US dollars.

(**)		Includes non-convertible debentures and other Brazilian Real denominated debt that bear interest at the Brazilian Interbank Certificate of Deposit (CDI) and Brazilian Government Long-term Interest Rates (TJLP) plus a spread. For these operations we have entered into derivative transactions to mitigate our exposure to the floating rate debt denominated in Brazilian Real, totaling R$ 11,707,566 of which R$ 10.720.542 has original interest rate above 7.1% per year. The average cost after taking into account the derivative transactions is 4.43% per year in dollars.

The average cost of all derivative transactions is 4.47% per year in US dollars.

In September 2010, Vale signed an agreement with the Export Import Bank of China and the Bank of China Limited to financing construction of 12 ships, with 400,000 dwt capacities, in the amount of US$ 1.229 billion. The term for payment is 13 years and Vale will receive the proceeds during the next 3 years, in accordance with the ship’s construction schedule.

In September 2010, Vale issued US$1 billion (equivalent to R$ 1,694,200) notes due 2020 and US$ 750 (equivalent to R$ 1,271,650) notes due 2039. The 2020 notes were sold at a price of 99.030% of the principal amount and will bear a coupon of 4.625% per year, payable semi-annually. The 2039 notes that were sold at a price of 110.872% of the principal amount will be consolidated with and form a single series with Vale Overseas’s US$ 1 billion 6.875% Guaranteed Notes due 2039 issued on November 10, 2009.

In June 2010 we entered into a bilateral pre-export finance agreement in the amount of US$500 million and final tenor of 10 years.

In March, 2010, we issued EUR750 million (equivalent to R$ 1,805,700) of 8-year euronotes at a price of 99,564% of the principal amount. These notes will mature in March 2018 and will bear a coupon of 4,375% per year, payable annually.

In January 2010, we redeemed all outstanding export receivables securitization 10-year notes issued in September 2000 at an interest rate of 8.926% per year and the notes issued in July 2003 at an interest rate of 4.43% per year. The outstanding principal amounts of those September 2010 notes were R$ 48 million and for the July 2013 notes were R$ 213 million, totaling R$ 261 million of debt redeemed.

Guarantee

On September 30, 2010, R$316,660 (December 31, 2009 — R$1,310,316) of the total aggregate outstanding debt were secured by receivables. The remain outstanding debt in the amount of R$ 42,483,200 (December 31, 2009 — R$ 40,132,717) were unsecured.

Our principal covenants require us to maintain certain ratios, such as debt to EBITDA and interest coverage. We have not identified any events of noncompliance as of September 30, 2010.

Credit Lines

Additionally, Vale has revolving credit lines available under which amounts can be drawn down and repaid at the option of the borrower. On September 30, 2010, the total amount available under revolving credit lines was US$1,600 million (equivalent to R$ 2,710,720), of which US$850 million (equivalent to R$ 1,440,070) was granted to Vale International and the balance to Vale Inco. As of September 30, 2010, neither Vale International nor Vale Inco had drawn any amounts under these facilities, but US$111,368 (equivalent to R$ 188,680) of letters of credit were issued and remained outstanding pursuant Vale Inco’s facility.

On October 4, 2010, we entered into agreement with Export Development Canada (EDC), for the financing our capital expenditure program. Pursuant to the agreement, EDC will provide a facility in an amount up to US$1 billion (equivalent to R$ 1,694,200 at September 2010). US$500 will be available for investments in Canada and the remaining US$500 will be related to existing and future Canadian purchases of goods and services.

In May 2008, Vale entered into framework agreements with the Japan Bank for International Cooperation in the amount of US$3 billion (equivalent to R$ 5,082,600 at September 2010) and Nippon Export and Investment Insurance in the amount of US$2 billion (equivalent to R$ 3,388,400 at September 2010) for the financing of mining, logistics and power generation projects. In November, 2009, Vale signed a US$300 million (equivalent to R$ 525,150) export facility agreement, through its subsidiary PT International Nickel Indonesia Tbk (PTI), with Japanese financial institutions using credit insurance provided by Nippon Export and Investment Insurance — NEXI, to finance the construction of the Karebbe hydroelectric power plant on the Larona river, island of Sulawesi, Indonesia. Through September 30, 2010, PT International had drawn down US$150 million (equivalent to R$ 261,180) on this facility.

In 2008, we established a credit line for R$7.3 billion, with Banco Nacional de Desenvolvimento Econômico e Social — BNDES (the Brazilian National Development Bank) to support our investment program. Up to September 30, 2010, Vale had drawn the amount of R$ 1,869,930 under this facility.

15- Provisions and Commitments

Vale and its subsidiaries are parties to labor, civil, tax and other suits underway and which are being contested both administratively and in court, which, when applicable, are backed by judicial deposits. Provisions for losses are estimated and recorded by Management based on the opinion of the Legal Department and its external legal counsels.

In addition to the provisions recorded, there are other contingent liabilities, split between taxes, labor and civil claims, estimated as possible losses in the amount of R$ 9,098,011 in the Consolidated (R$ 3,821,057 in the parent Company).

Provisions of Contingencies

Provisions, considered by Management and its legal counsel are sufficient to cover probable losses from, are detailed as follows:


	Consolidated				Parent Company
	September 30, 2010				September 30, 2010
	(unaudited)		December 31, 2009		(unaudited)		December 31, 2009
Tax contingencies		1,682,877		1,932,701		627,477		1,171,861
Civil contingencies		904,163		934,609		657,842		539,429
Labor contingencies		1,117,022		1,273,181		898,358		993,335
Environmental contingencies		56,834		61,126		29,011		25,935

Total accrued liabilities		3,760,896		4,201,617		2,212,688		2,730,560


	September 30, 2010						September 30, 2010
	(unaudited)			December 31, 2009			(unaudited)			December 31, 2009
Balance at the beginning of the period		4,201,617			4,053,294			2,730,560			2,592,278
Provisions, net of reversals		(417,527	)		535,621			(327,701	)		191,536
Settlements		(227,005	)		(377,380	)		(226,324	)		(237,103	)
Monetary variance		203,811			(9,918	)		36,153			183,849

Balance at the end of period		3,760,896			4,201,617			2,212,688			2,730,560

	I)		Tax Contingencies:

			Main tax causes refer substantially to discussions about the calculation basis of the Financial Compensation by Exploration of Mineral Resources (CFEM) and on denials of applications for compensation claims in the settlement of federal taxes. Others refer to collections of Additional Compensation Labor Ports (AITP) and questions about the location for Tax Services (ISS) incidence.

			In 2009, accrued values related to discussion of compensation for losses and negative basis of social contribution above 30% were wrote down, due to withdrawal of the action and therefore ended the process with release of funds deposited in escrow in favor of the Union.

	II)		Civil Contingencies:

			The civil lawsuits are mainly related to claims made against the Company by contractors in connection with losses allegedly incurred by them as a result of several economic plans, accidents and return of land.

	III)		Labor Contingencies:

			Labor and social security contingencies — it refers mainly to claims for (a) payment of time spent traveling from their residences to the work-place, (b) additional health and safety related payments, and (c) disputes about the amount of indemnities paid upon dismissal and one-third extra holiday pay.

			In addition to those provisions, there are judicial deposits that in September 30, 2010 totaled R$ 2,930,331 (R$ 3,108,522 at December 31, 2009) in Consolidated and R$ 2,065,269 (R$ 2,433,036 at December 31, 2009) in the parent Company.

Other commitments

In connection with a tax-advantaged lease financing arrangement sponsored by the French Government, Vale provided certain guarantees on December 30, 2004 on behalf of Vale New Caledonia S.A.S. (VNC) pursuant to which was guaranteed payments due from VNC of up to a maximum amount of US$100 (“Maximum Amount”) in connection with an indemnity. This guarantee was provided to BNP Paribas for the benefit of the tax investors of GniFi, the special purpose vehicle which owns a portion of the assets in our nickel cobalt processing plant in New Caledonia (“Girardin Assets”). The Company also provided an additional guarantee covering the payments due from VNC of (a) amounts exceeding the Maximum Amount in connection with the indemnity and (b) certain other amounts payable by VNC under a lease agreement covering the Girardin Assets. This guarantee was provided to BNP Paribas for the benefit of GniFi.

Another commitment incorporated in the tax–advantaged lease financing arrangement was that the Girardin Assets would be substantially complete by December 31, 2009. In light of the delay in the start up of VNC processing facilities the December 31, 2009 substantially complete date was not met. Management proposed an extension to the substantially complete date from December 31, 2009 to December 31, 2010. Both the French government authorities and the tax investors have agreed to this extension. The French tax authorities issued their signed extension on March 12, 2010. Accordingly the benefits of the financing structure are fully expected to be maintained and Vale anticipates that there will be no recapture of the tax advantages provided under this financing structure.

In 2009, two new bank guarantees totaling US$59 (€43) as at September 30, 2010 were established by Vale on behalf of VNC in favor of the South Province of New Caledonia in order to guarantee the performance of VNC with respect to certain environmental obligations in relation to the metallurgical plant and the Kwe West residue storage facility.

Sumic Nickel Netherlands B.V. (“Sumic”), a 21% stockholder of VNC, has a put option to sell to us 25%, 50%, or 100% of the shares they own of VNC. The put option can be exercised if the defined cost of the initial nickel-cobalt development project, as measured by funding provided to VNC, in natural currencies and converted to U.S. dollars at specified rates of exchange, in the form of Girardin funding, shareholder loans and equity contributions by shareholders to VNC, exceeded US$4.2 billion and an agreement cannot be reached on how to proceed with the project. On February 15, 2010, Vale has formally amended the agreement with Sumic to increase the threshold to approximately US$4.6 billion at specified rates of exchange. On May 27, 2010 the threshold was reached and we are currently discussing with Sumic an extension of the put option date into the first half of 2011.

Vale provided a guarantee covering certain termination payments due from VNC to the supplier under an electricity supply agreement (“ESA”) entered into in October 2004 for the VNC project. The amount of the termination payments guaranteed depends upon a number of factors, including whether any termination of the ESA is a result of a default by VNC and the date on which an early termination of the ESA were to occur. During the first quarter of 2010 the supply of electricity under the ESA to the project began, and the guaranteed amount now decreases over the life of the ESA from its maximum amount. As at September 30, 2010 the guarantee was US$176 million (€ 131 million).

In February 2009, Vale and its subsidiary, Vale Newfoundland and Labrador Limited (“VNL”), entered into a fourth amendment to the Voisey’s Bay Development agreement with the Government of Newfoundland and Labrador, Canada, that permitted VNL to ship up to 55,000 metric tones of nickel concentrate from the Voisey’s Bay area mines. As part of the agreement, VNL agreed to provide the Government of Newfoundland and Labrador financial assurance in the form of letters of credit each in the amount of US$16 million (CAD$16 million) for each shipment of nickel concentrate shipped out of the province from January 1, 2009 to August 31, 2009. The amount of this financial assurance was US$110 million (CAD$112 million) based on seven shipments of nickel concentrate and as of June 30, 2010, US$11 million (CAD$11 million) remains outstanding.

As at September 30, 2010, there was an additional US$111 million in letters of credit issued and outstanding pursuant to Vale’s syndicate revolving credit facility, as well as an additional US$41 million of letters of credit and US$48 million in bank guarantees that were issued and outstanding. These are associated with environmental reclamation and other operating associated items such as insurance, electricity commitments and import and export duties.

In September and April 2010 we paid remuneration on these debentures of R$8.330 and R$8.658, respectively. During 2010, we paid a total of R$16.988.

16- Provision for Asset Retirement Obligations


	Consolidated						Parent Company
	September 30, 2010			December 31, 2009			September 30, 2010			December 31, 2009
	(unaudited)			(I)			(unaudited)			(I)

Provisions in the beginning of year		2,273,670			2,109,697			895,579			891,450

Accretion expense		38,756			136,210			30,291			90,407
Liabilities settled in the current period		(4,216	)		(85,842	)		(3,380	)		(74,419	)
Revisions in estimated cash flows (*)		(17,953	)		38,632			(23,868	)		(61,916	)
Cumulative translation adjustment		(25,520	)		(110,897	)		—			—

Provisions in the end of year		2,264,737			2,087,800			898,622			845,522


Current		137,659			157,048			101,212			121,485
Non-current		2,127,078			1,930,752			797,410			724,037


		2,264,737			2,087,800			898,622			845,522


(I)		period adjusted by new CPC’s accounting pronouncements, for comparative purposes, according to note 3.

(*)		Includes R$ 79,999 related to the purchase of Vale Fertilizantes S.A. and Vale Fosfatados S.A.

17- Pension Conts

Previously disclosed in our financial statements closing on 2009, hoping to contribute in fiscal year 2010 for pension and other benefits from the R$ 521,526 in consolidated and R$ 209,851 in the Parent Company. Until September 30, 2010 such contributions totaled R$ 323,508 in consolidated and R$ 174,477 in the Parent Company. Do not expect significant changes in our preliminary estimate.


	Consolidated
	Three-month period ended in (unaudited)
	September 30, 2010									September 30, 2009
	Overfunded			Underfunded			Underfunded			Overfunded			Underfunded			Underfunded
	pension			pension			other benefits			pension			pension			other benefits
Service cost — benefits earned during the period		2,139			33,225			13,086			5,354			20,018			6,386
Interest cost on projected benefit obligation		178,524			160,616			45,661			153,518			117,704			39,023
Expected return on assets		(275,291	)		(142,817	)		—			(211,488	)		(85,953	)		(1,820	)
Amortization of initial transitory obligation		(1,310	)		21,805			(14,898	)		6,786			7,279			(7,227	)

Net periodic pension cost		(95,938	)		72,829			43,849			(45,830	)		59,048			36,362


	Accumulated (unaudited)
	September 30, 2010									September 30, 2009
	Overfunded			Underfunded			Underfunded			Overfunded			Underfunded			Underfunded
	pension			pension			other benefits			pension			pension			other benefits
Service cost — benefits earned during the period		2,185			91,669			34,819			14,279			67,003			25,017
Interest cost on projected benefit obligation		430,617			480,189			131,123			409,382			359,037			127,070
Expected return on assets		(694,968	)		(433,872	)		—			(563,967	)		(281,583	)		(1,820	)
Amortization of initial transitory obligation		(1,310	)		21,805			(14,898	)		18,095			27,748			(35,082	)

Net periodic pension cost		(263,476	)		159,791			151,044			(122,211	)		172,205			115,185

18- Long-term Incentive Compensation Plan

Under the terms of the long-term incentive compensation plan, the participants, restricted to certain executives, may elect to allocate part of their annual bonus to the plan. The allocation is applied to purchase preferred shares of Vale, through a predefined financial institution, at market conditions and with no benefit provided by Vale.

The shares purchased by each executive are unrestricted and may, at the participant’s discretion, be sold at any time. However, the shares must be held for a three-year period and the executive must be continually employed by Vale during that period. The participant then becomes entitled to receive from Vale a cash payment equivalent to the total amount of shares held, based on the market rates. The total shares linked to the plan at September 30, 2010 and December 31, 2009, is 2,896,038 and 1,809,117, respectively.

Additionally, as a long-term incentive certain eligible executives have the opportunity to receive at the end of the triennial cycle a certain number of shares at market rates, based on an evaluation of their career and performance factors measured as an indicator of total return to stockholders.

We account for the compensation cost provided to our executives under this long-term incentive compensation plan, following the requirements “Comitê de Pronunciamentos Contábeis – CPC 10 Pagamentos Baseados em ações”. Liabilities are measured at each reporting date at fair value, based on market rates. Compensation costs incurred are recognized, over the defined three-year vesting period. At September 30, 2010 and December 31, 2009, we recognized a liability of R$ 159,465 and R$ 124,517, respectively, through the Statement of Income.

19 Stockholders’ equity

Capital

Each holder of common and preferred class A stock is entitled to one vote for each share on all matters brought before stockholders’ meetings, except for the election of the Board of Directors, which is restricted to the holders of common stock. The Brazilian Government holds twelve preferred special shares which confer permanent veto rights over certain matters.

Both common and preferred stockholders are entitled to receive a mandatory minimum dividend of 25% of annual adjusted net income under Brazilian GAAP, once declared at the annual stockholders’ meeting. In the case of preferred stockholders, this dividend cannot be less than 6% of the preferred capital as stated in the statutory accounting records or, if greater, 3% of the Brazilian GAAP equity value per share.

In October, 2010, the Board of Directors approved the following proposals: (i) payment of the second tranche of the minimum dividend of US$ 1.250 billion (equivalent to R$ 2,118,750 in September 30, 2010), (ii) payment of an additional dividend of US$ 500 (equivalent to R$ 1,058,875 in September 30, 2010) . The payments will be made on October 29, 2010.

In April, 2010, the Company paid its stockholders the amount of R$ 2,198,000 in the form of interest on stockholders’ equity, correspondent to R$0,421660513 per share.

The members of the Board of Directors and the Executive Board together own 297,295 common shares and 1,145,337 preferred shares.

The Board of Directors has the power, without requiring an amendment to the bylaws, to allow the issue of new shares (authorized capital) including through the capitalization of profits and reserves up to the authorized limit of 3,600,000,000 common shares and 7,200,000,000 preferred shares without par value.

Funds linked to Future Mandatory Conversion into Shares

The outstanding issued mandatory convertible notes on September 30, 2010 is as follows:

Date

Amount (thousands of reais)

Headings

Emission

Expiration

Gross

Net of charges

Coupon

Tranches VALE and VALE P-2012

July/2009

June/2012

1,858

1,523

6,75% a.a.

The notes pay a coupon quarterly and are entitled to an additional remuneration equivalent to the cash distribution paid to ADS holders. These notes were classified as a capital instrument, mainly due to the fact that neither the Company nor the holders have the option to settle the operation, whether fully or partially, with cash, and the conversion is mandatory; consequently, they were recognized as a specific component of shareholders’ equity, net of financial charges.

The funds linked to future mandatory conversion, net of charges are equivalent to the maximum of common shares and preferred shares, as follows. All the shares are currently held in treasury.

Maximum amount of shares

Amount (thousands of reais)

Headings

Common

Preferred

Common

Preferred

Tranches VALE and VALE P-2012

18,415,859

47,284,800

473

1,050

In June 2010, the notes series Rio and Rio P were converted into ADS and represent an aggregate of 49,305,205 common shares and 26,130,033 preferred class A shares respectively. The conversion was made using 75,435,238 treasury stocks held by the Company. The difference between the conversion amount and the treasury stocks book value of R$ 2,027,981 was accounted for in additional paid-in capital in the stockholder’s equity.

In April, 2010, we paid to holders of mandatorily convertible notes additional interest: series RIO and RIO P, R$ 0.722861 and R$ 0.857938 per note, respectively and series VALE-2012 and VALE.P-2012, R$ 1.042411 and R$ 1.205663 per note, respectively.

Treasury Stock

On September 23, 2010, The Board of Directors approved a share buy-back program. The shares are to be held in treasury for subsequent sale or cancellation, amounting up to US$ 2 billion and involving up to 64,810,513 common shares and up to 98,367,748 preferred shares. The share buy-back program was completely executed in October, 2010.

As of September 30, 2010 we had acquired 108,299,565 shares in the amount of R$ 2,921,658, as follows.


	Quantity of shares									Unit acquisition cost						Average quoted market price
	September							December 31,								September		December
Classes	30, 2010		Increase		Decrease			2009		Average		*Low ()**		High		30, 2010		31, 2009
Preferred		72,577,171		21,125,300		(26,130,033	)		77,581,904		30.03		1.17		46.50		42.02		33.22
Common		35,722,394		10,029,700		(49,305,205	)		74,997,899		20.77		1.67		52.96		47.84		38.23

		108,299,565		31,155,000		(75,435,238	)		152,579,803


(*)		original value before splits of shares in the amount of R$ 14.02 for preferred shares and R$ 20.07 for common shares.

20- Basic and diluted earnings per share

Basic and diluted earnings per share amounts have been calculated as follows:


	Consolidated
	Three-month period ended in				Nine-month period ended in
	(unaudited)				(unaudited)
	September 30,				September 30,
	2010		September 30,		2010			September 30,
	(unaudited)		2009 (I)		(unaudited)			2009 (I)
Net income from continuing operations attributable to the Company’s stockholders		10,539,078		2,986,829		20,289,523			7,629,779

Discontinued operations, net of tax		14,610		—		(221,708	)		—

Net income attributable to the Company’s stockholders		10,553,688		2,986,829		20,067,815			7,629,779

Basic and diluted earnings per share

Income available to preferred stockholders		4,054,478		1,130,628		7,720,605			2,888,161
Income available to common stockholders		6,369,677		1,771,261		12,097,736			4,524,641
Income available to convertible notes linked to preferred shares		93,225		43,189		179,547			110,325
Income available to convertible notes linked to common shares		36,308		41,751		69,927			106,652
Weighted average number of shares outstanding (thousands of shares) — preferred shares		2,056,473		2,030,727		2,043,102			2,030,727
Weighted average number of shares outstanding (thousands of shares) — common shares		3,230,765		3,181,709		3,204,885			3,181,709
Treasury preferred shares linked to mandatorily convertible notes		47,285		77,580		47,285			77,580
Treasury common shares linked to mandatorily convertible notes		18,416		74,998		18,416			74,998

Total		5,352,939		5,365,014		5,313,688			5,365,014


Earnings per preferred share		1.97		0.56		3.78			1.42
Earnings per common share		1.97		0.56		3.78			1.42
Earnings per convertible notes linked to preferred share (*)		1.97		0.56		3.78			1.42
Earnings per convertible notes linked to common share (*)		1.97		0.56		3.78			1.42

Continuous operations
Earnings per preferred share		1.97		—		3.82			—
Earnings per common share		1.97		—		3.82			—
Earnings per convertible notes linked to preferred share (*)		1.97		—		3.82			—
Earnings per convertible notes linked to common share (*)		1.97		—		3.82			—

Discontinued operations
Earnings per preferred share		—		—		(0.04	)		—
Earnings per common share		—		—		(0.04	)		—
Earnings per convertible notes linked to preferred share (*)		—		—		(0.04	)		—
Earnings per convertible notes linked to common share (*)		—		—		(0.04	)		—


(*)		Basic earnings per share only, as dilution assumes conversion

If the conversion of the convertible notes had been included in the calculation of diluted earnings per share they would have generated the following dilutive effect as shown below:


	Consolidated
	Three-month period ended in				Nine-month period ended in
	(unaudited)				(unaudited)
	September 30,		September 30,		September 30,			September 30,
	2010 (unaudited)		2009		2010 (unaudited)			2009

Income available to preferred stockholders		4,147,704		1,173,817		7,894,908			2,998,486
Income available to common stockholders		6,405,984		1,813,012		12,172,907			4,631,293
Weighted average number of shares outstanding (thousands of shares) — preferred shares		2,103,758		2,108,534		2,090,387			2,108,307
Weighted average number of shares outstanding (thousands of shares) — common shares		3,249,181		3,256,725		3,223,101			3,256,707
Earnings per preferred share		1.97		0.56		3.78			1.42
Earnings per common share		1.97		0.56		3.78			1.42

Continuous operations
Earnings per preferred share		1.97		—		3.82			—
Earnings per common share		1.97		—		3.82			—

Discontinued operations
Earnings per preferred share		—		—		(0.04	)		—
Earnings per common share		—		—		(0.04	)		—

21- Segment and geographical information

Vale adopts for interim reporting of our consolidated operating segments, the accounting standard CPC 22 that introduced the concept of “chief operation decision maker” on the information reported by segment, for which financial information should be presented in the internal databases used by decision makers to evaluate performance of the segments and decide how to allocate resources to segments considering the new segment acquired, fertilizer, and the related reorganization occurred the operating segments are: 1) Bulk materials represented by Iron or, Pellets, Manganese ore and ferroalloys, Coal; 2) Base Metals represented by Nickel, Aluminum and Copper, 3) Fertilizers; and 4) Logistics services. The information was analyzed by segment as follows:

Results by segment — before eliminations (aggregated)


	Three-month period ended in (unaudited)
	September 30, 2010																					September 30, 2009 (I)
	Bulk																					Bulk
	Materials			Basic Metals			Fertilizers			Logistic			Others			Elimination			Consolidated			Materials			Basic Metals			Fertilizers			Logistic			Others			Elimination			Consolidated
RESULTS
Gross revenues — Foreign		33,532,895			4,041,052			23,919			—			267,986			(16,055,557	)		21,810,295			12,759,088			4,102,729			—			37,205			170,576			(5,687,472	)		11,382,126
Gross revenues — Domestic		2,679,016			416,785			1,468,547			1,140,634			317,637			(1,456,682	)		4,565,937			1,109,014			478,700			218,833			900,815			117,616			(624,655	)		2,200,323

Cost and expenses		(21,439,347	)		(3,716,205	)		(1,434,843	)		(836,840	)		(615,349	)		17,512,239			(10,530,345	)		(9,038,189	)		(3,926,169	)		(66,641	)		(588,409	)		(246,082	)		6,312,127			(7,553,363	)
Depreciation, depletion and amortization		(648,443	)		(416,209	)		(83,239	)		(68,562	)		(14,300	)		—			(1,230,753	)		(577,854	)		(735,787	)		(32,218	)		(92,482	)		(9,447	)		—			(1,447,788	)

Operating income		14,124,121			325,423			(25,616	)		235,232			(44,026	)		—			14,615,134			4,252,059			(80,527	)		119,974			257,129			32,663			—			4,581,298

Resultado Financeiro		1,596,420			(318,435	)		29,968			(5,734	)		(1,237,494	)		—			64,725			318,009			(34,058	)		—			(23,294	)		(70,476	)		—			190,181
Gain on sale of assets		—			—			—			—			—			—			—			—			17,656			—			—			110,899			—			128,555
Equity in results of affiliates and joint ventures and change in provision for losses on equity investments		18,642			19,412			—			—			(94,237	)		—			(56,183	)		99,886			—			—			—			(69,624	)		—			30,262
Income taxes		(4,035,274	)		(44,747	)		(11,637	)		(23,609	)		145,014			—			(3,970,253	)		(1,836,635	)		29,401			—			(40,276	)		1,992			—			(1,845,518	)
Discontinued operations, net of tax		—			14,610			—			—			—			—			14,610			—			—			—			—			—			—			—
Net income (loss) attributable to noncontrolling interests		(32,459	)		(83,752	)		—			—			1,866			—			(114,345	)		12,085			(94,129	)		—			—			(15,905	)		—			(97,949	)


Net income attributable to Company’s stockholders		11,671,450			(87,489	)		(7,285	)		205,889			(1,228,877	)		—			10,553,688			2,845,404			(161,657	)		119,974			193,559			(10,451	)		—			2,986,829


Sales classified by geographic destination:
Foreign market
America, except United States		786,493			682,371			23,919			—			—			(447,038	)		1,045,745			467,840			458,141			—			—			—			(251,136	)		674,845
United States		76,733			283,348			—			—			267,986			4,618			632,685			20,512			478,279			—			—			135,771			(17,154	)		617,408
Europe		6,913,540			1,131,190			—			—			—			(3,516,096	)		4,528,634			3,636,424			1,696,809			—			—			1,807			(2,993,088	)		2,341,952
Middle East/Africa/Oceania		1,767,987			47,298			—			—			—			(724,089	)		1,091,196			417,546			99,251			—			—			—			(189,585	)		327,212
Japan		4,161,422			638,413			—			—			—			(1,824,472	)		2,975,363			1,237,234			528,353			—			—			—			(493,160	)		1,272,427
China		16,608,222			368,244			—			—			—			(7,839,804	)		9,136,662			5,718,142			371,525			—			37,205			—			(1,334,053	)		4,792,819
Asia, other than Japan and China		3,218,498			890,188			—			—			—			(1,708,676	)		2,400,010			1,261,390			470,371			—			—			32,998			(409,296	)		1,355,463

		33,532,895			4,041,052			23,919			—			267,986			(16,055,557	)		21,810,295			12,759,088			4,102,729			—			37,205			170,576			(5,687,472	)		11,382,126
Domestic market		2,679,016			416,785			1,468,547			1,140,634			317,637			(1,456,682	)		4,565,937			1,109,014			478,700			218,833			900,815			117,616			(624,655	)		2,200,323

Total		36,211,911			4,457,837			1,492,466			1,140,634			585,623			(17,512,239	)		26,376,232			13,868,102			4,581,429			218,833			938,020			288,192			(6,312,127	)		13,582,449


Property, plant and equipment, intangible e biological assets		56,360,632			56,088,732			15,792,346			5,864,866			8,168,188			—			142,274,764			38,449,709			62,688,228			2,555,221			9,886,886			8,610,812			—			122,190,856
Investment		718,610			42,126			—			217,732			3,721,421			—			4,699,889			427,554			75,674			—			217,713			3,798,239			—			4,519,180


		57,079,242			56,130,858			15,792,346			6,082,598			11,889,609			—			146,974,653			38,877,263			62,763,902			2,555,221			10,104,599			12,409,051			—			126,710,036


(I)		period adjusted by new CPC’s accounting pronouncements, for comparative purposes, according to note 3.

Results by segment — before eliminations (aggregated)


	Six-month period ended (unaudited)
	September 30, 2010																					September 30, 2009 (I)
	Bulk			Basic																		Bulk			Basic
	Materials			Metals			Fertilizers			Logistic			Others			Elimination			Consolidated			Materials			Metals			Fertilizers			Logistic			Others			Elimination			Consolidated
RESULTS

Gross revenues — Foreign		68,714,189			11,569,390			23,919			754,447			(32,805,950	)		48,276,499			96,532,494			38,172,762			12,366,345			—			71,398			448,209			(18,873,273	)		32,185,441

Gross revenues — Domestic		6,423,665			1,157,206			1,964,254			690,969			(3,204,858	)		10,110,059			17,141,295			2,555,729			1,355,642			621,166			2,396,213			283,605			(1,633,339	)		5,579,016

Cost and expenses		(46,277,640	)		(10,695,101	)		(1,891,123	)		(1,550,835	)		36,010,808			(26,792,083	)		(51,195,974	)		(27,827,862	)		(12,356,948	)		(208,810	)		(1,723,004	)		(1,251,004	)		20,506,612			(22,861,016	)
Depreciation, depletion and amortization		(1,930,869	)		(1,630,170	)		(126,305	)		(27,388	)		—			(3,946,919	)		(7,661,651	)		(1,522,653	)		(2,140,884	)		(37,794	)		(266,679	)		(29,965	)		—			(3,997,975	)

Operating income		26,929,345			401,325			(29,255	)		(132,807	)		—			27,647,556			54,816,164			11,377,976			(775,845	)		374,562			477,928			(549,155	)		—			10,905,466
Financial income		114,299			(1,154,169	)		32,193			(1,243,655	)		—			(2,287,772	)		(4,539,104	)		2,982,360			(287,664	)		—			(84,719	)		(165,704	)		—			2,444,273
Gain on sale of investments		—			—			—			—			—			—			—			—			25,564			—			—			398,713			—			424,277
Equity in results of affiliates and joint ventures and change in provision for losses on equity investments		5,456			20,112			—			(37,252	)		—			(12,015	)		(23,699	)		84,743			(176	)		—			3,749			5,417			—			93,733
Income taxes		(5,103,958	)		219,358			(2,832	)		27,383			—			(4,915,148	)		(9,775,197	)		(6,427,409	)		416,058			—			(93,752	)		(33,427	)		—			(6,138,530	)
Discontinued operation, net of tax		—			(221,708	)		—			—			—			(221,708	)		(443,416	)		—			—			—			—			—			—			—
Net income (loss) attributable to noncontrolling interests		(34,883	)		(110,076	)		—			1,861			—			(143,098	)		(286,196	)		28,819			(99,457	)		—			—			(28,802	)		—			(99,440	)

Net income attributable to the Company’s stockholders		21,910,259			(845,158	)		106			(1,384,470	)		—			20,067,815			39,748,552			8,046,489			(721,520	)		374,562			303,206			(372,958	)		—			7,629,779


Sales classified by geographic destination:
Foreign market

United States		1,881,679			1,782,064			23,919			25,298			(1,197,407	)		2,536,057			5,051,610			742,185			2,190,244			—			—			—			(903,919	)		2,028,510

Europe		128,914			884,533			—			712,986			(66,267	)		1,660,166			3,320,332			76,855			1,453,023			—			—			412,798			(104,877	)		1,837,799

Middle East/Africa/Oceania		17,051,303			3,772,059			—			16,163			(9,336,603	)		11,502,922			23,005,844			9,312,097			3,975,024			—			—			2,413			(7,614,676	)		5,674,858

Japan		3,727,375			258,093			—			—			(1,372,421	)		2,613,047			5,226,094			1,692,428			481,827			—			—			—			(1,023,587	)		1,150,668

China		8,652,222			1,724,260			—			—			(3,931,986	)		6,444,496			12,888,992			3,374,351			1,224,837			—			—			—			(1,418,176	)		3,181,012

Asia, other than Japan and China		31,249,204			1,042,083			—			—			(14,026,931	)		18,264,356			36,528,712			19,562,148			1,385,148			—			71,398			—			(6,338,164	)		14,680,530


		62,690,697			9,463,092			23,919			754,447			(29,931,615	)		43,021,044			86,021,584			34,760,064			10,710,103			—			71,398			415,211			(17,403,399	)		28,553,377

Domestic market		68,714,189			11,569,390			23,919			754,447			(32,805,950	)		48,276,499			96,532,494			38,172,762			12,366,345			—			71,398			448,209			(18,873,273	)		32,185,441


Total		131,404,886			21,032,482			47,838			1,508,894			(62,737,565	)		91,297,543			182,554,078			72,932,826			23,076,448			—			142,796			863,420			(36,276,672	)		60,738,818


Property, plant and equipment, intangible e biological assets]		56,360,632			56,088,732			15,792,346			8,168,188			—			142,274,764			278,684,662			38,449,709			62,688,228			2,555,221			9,886,886			8,610,812			—			122,190,856
Investments		718,610			42,126			—			3,721,421			—			4,699,889			9,182,046			427,554			75,674			—			217,713			3,798,239			—			4,519,180


		57,079,242			56,130,858			15,792,346			11,889,609			—			146,974,653			287,866,708			38,877,263			62,763,902			2,555,221			10,104,599			12,409,051			—			126,710,036


(I)		period adjusted by new CPC’s accounting pronouncements, for comparative purposes, according to note 3.

22- Other expenses

The income statement line “Other operating expenses” totaled R$ 2,643,524 for the nine month period ended September 30, 2010, mostly due to pre operational expenses, loss of materials and idle capacity and stoppage operations expenses which comprised R$ 310,590, R$ 186,991 and R$ 844,306 respectively.

23- Derivatives Financial Instruments

a) Risk Management Policy

Vale has developed its risk management strategy in order to provide an integrated approach of the risks the Company is exposed to. To do that, we evaluate not only the impact of market risk factors in the business results (market risk), but also the risk arising from third party obligations with Vale (credit risk) and those risks inherent in Vale’s operational processes (operational risk).

The enterprise wide risk Management approach, that encompasses all kinds of risk, as well as the relations between the several market risk factors (correlations), aims to assess the impact that such events would bring considering the natural hedges presented in the company’s portfolio. Therefore, when assessing the risk associated with Vale’s business, one can observe the positive effect due to the mix of products and currencies in Vale’s portfolio. This diversification implies in a natural reduction of the overall risk of the company. Any risk mitigation strategy, whenever necessary, will be implemented if it contributes significantly for the reduction on the volatility on Vale’s cash flows bringing the risk of the company to an acceptable level.

Vale considers that the effective management of risk is a key objective to support its growth strategy and financial flexibility. The risk reduction on Vale’s future cash flow contributes to a better perception of the company’s credit quality, improving its ability to access different markets and reducing the financing costs. Therefore, the board of directors has established an enterprise-wide risk Management policy and a risk Management committee.

The risk management policy determines that Vale should evaluate regularly its cash flow risks as well as risk mitigation strategies. As previously stated, whenever considered necessary, these mitigation strategies should be put in place with the objective of reducing the risks regarding the obligations assumed by the Company, both with third parties and its shareholders.

The executive board is responsible for the evaluation and approval of the risk mitigation strategies recommended by the risk Management committee. The committee is responsible for overseeing and reviewing our risk Management principles and risk Management instruments, besides reporting periodically to the executive board regarding the Management process and risk monitoring, including the main risks Vale is exposed to and their impact on Vale’s cash flow.

The risk management policy and procedures, that complement the risk management governance model, require the diversification of operations and counterparties and prohibit speculative transactions with derivatives.

Besides the risk management governance model, Vale has in place a well defined corporate governance structure with well defined roles and responsibilities. The recommendation and execution of derivative transactions are implemented by different and independent areas. It is the responsibility of the risk management department to define and propose to the risk management committee market risk mitigation strategies consistent with Vale and it’s wholly owned subsidiaries corporate strategy. It is the responsibility of the finance department to execute the risk mitigation strategies through the use of derivatives. The independence of the areas guarantees an effective control on these operations.

The monitoring and monthly evaluations of the consolidated risk exposure allow us to evaluate the financial results and the impact on Vale’s cash flow, as well as guarantee that the initial goals will be achieved. The fair value measurements of the trades are reported weekly to Management.

All derivative trades were recognized in our balance sheet at fair value and their respective gains or losses were recognized according to the current accounting standard.

Considering the nature of Vale’s business and operations, the main market risk factors which the Company is exposed are:

•

Interest rates;

•

Foreign exchange;

•

Products prices;

•

Input and other costs.

b) Fair value computation methodology

Well-known market participants’ valuation methodologies were used to compute the fair value of the financial instruments. These instruments were evaluated computing their present values considering market curves that impact the instrument on the valuation date. The curves and prices used in the pricing for each group of instruments are detailed in the topic “market curves”.

The pricing method considered in the case of European options is the Black & Scholes model, which is widely used among derivatives market participants for the option pricing. In this model, the derivative fair value is a function of the volatility, spot price of the underlying asset, the strike price, the risk free rate and the time to maturity. In the case of options where the financial result is a function of the average of the underlying price for a certain period of the time, called Asian options, we use the Turnbull & Wakeman model, also widely used to price this type of instrument. Besides the parameters used on the Black & Scholes model it is considered in this model the price averaging period.

In the case of swaps, the long and short legs’ present values are estimated discounting their cash flows using the interest rate of the currency in which they are denominated. The difference between the present values of the long leg and short leg of the swap is the fair value.

In the case of swaps linked to TJLP, the fair value calculation considers constant the TJLP rate, that is, the future cash flows in reais are forecasted considering the last TJLP published.

The pricing for the commodities future settlement contracts (buy or sell) is computed using forward curves for each commodity. Normally, these curves are collected in the exchanges where these commodities are traded, among them, London Metals Exchange (LME) and COMEX (Commodities Exchange) or market price providers. When there is no price for a specific date, we use interpolations between the available periods.

c) Value at Risk computation methodology

The Value at Risk of the positions was measured using a delta-Normal parametric approach, which considers that the future distribution of the risk factors — and its correlations — tends to present the same statistic properties verified in the historical data. The value at risk of Vale’s derivatives current positions was estimated considering one business day time horizon and a 95% confidence level.

d) Sensitivity Analysis methodology

In the topic “Sensitivity Analysis” we present the table with potential gain/loss for all outstanding positions as of September 30, 2010 considering pre-defined stress scenarios defined for the main market risk factors.

e) Contracts subjected to margin calls

Vale has contracts subject to margin calls only for part of copper and nickel trades executed by its wholly-owned subsidiary Vale Canada Ltd. The total cash amount as of September 2010 was not relevant.

f) Initial Cost of Contracts

The financial derivatives negotiated by Vale and its controlled companies described in this document didn’t have initial costs (initial cash flow) associated. Even the option contracts were executed trough zero cost structures (zero cost collars).

g) Foreign Exchange and Interest Rate Derivative Positions

The Company’s cash flow is subjected to volatility of several different currencies against the U.S. Dollar. While most of our product prices are indexed to US dollars, most of our costs, disbursements and investments are indexed to currencies other than the U.S. Dollar, mainly Brazilian Reais and Canadian dollars.

In order to reduce the company’s potential cash flow volatility arising from this currency mismatch we use FX derivatives instruments. The main strategy used by Vale is to swap Debts linked to Brazilian reais into U.S. Dollars so as to attenuate the impact of BRL/USD exchange rate as most of our revenues are denominated in USD.

The swap transactions used to convert debt linked to Brazilian reais into U.S. Dollars have similar – and sometimes shorter – settlement dates than the final maturity of the debt instruments. Their amounts are similar to the principal and interest payments, subjected to liquidity market conditions. The swaps with shorter settlement date than the debts’ final maturity are renegotiated through time so that their final maturity match – or become closer – to the debt final maturity. At each settlement date, the results on the swap transactions partially offset the impact of the foreign exchange rate in our obligations, contributing to stabilize the cash disbursements in U.S. Dollars for the interest and/or principal payment of our Brazilian Real denominated debt.

In the event of an appreciation (depreciation) of the Brazilian Real against the U.S. Dollar, the negative (positive) impact on Vale debt service (interest and/or principal payment) measured in U.S. Dollars will be almost totally offset by a positive (negative) effect from the swap transaction, regardless of the U.S. dollar / Brazilian Real exchange rate on the payment date.

Vale has also a cash flow exposure to interest rates risks over loans and financings. The U.S. Dollars floating rate debt in the portfolio consists mainly of loans including export pre-payments, commercial banks and multilateral organizations loans. In general, the U.S. Dollar floating rate debt is mainly subject to changes in the Libor. To mitigate the impact of the interest rate volatility on the cash flow, Vale takes advantage of natural hedges allowed by the positive correlation of metal prices and U.S. Dollar floating rates. When natural hedges are not present, Vale enters into financial instruments to obtain the same effect.

As of September 30, 2010, the total amount and interests of Brazilian Real denominated debt converted through swaps into US Dollars was R$ 11.7 billion (US$ 6.9 billion), and the total amount and interests of Euro denominated debt converted through swaps into US Dollars was € 500 million (US$ 682 million). The average cost in dollars was 4.47% after the swaps transactions were implemented. Due to liquidity constraints, the swaps’ average payment term might be shorter than the debt average payment term.

The following tables show as of September 30, 2010, the derivatives positions for Vale and controlled companies with the following information: notional amount, fair value, value at risk, gains or losses in the period and the fair value breakdown by payment date for each group of instruments.

Protection program for the Real denominated debt indexed to CDI

•

CDI vs. USD fixed rate swap – In order to reduce the cash flow volatility, Vale entered into swap transactions to convert the cash flows from debt instruments denominated in Brazilian Reais linked to CDI to U.S. Dollars. In those swaps, Vale pays fixed rates in U.S. Dollars and receives payments linked to CDI.

•

CDI vs. USD floating rate swap – In order to reduce the cash flow volatility, Vale entered into swap transactions to convert the cash flows from debt instruments denominated in Brazilian Reais linked to CDI to U.S. Dollars. In those swaps, Vale pays floating rates in U.S. Dollars (Libor – London Interbank Offered Rate) and receives payments linked to CDI.

Those instruments were used to convert the cash flows from debentures issued in 2006 with a nominal value of R$ 5.5 billion, from the NCE (Credit Export Notes) issued in 2008 with nominal value of R$ 2 billion and also from property and services acquisition financing realized in 2006 and 2007 with nominal value of R$ 1 billion.


															Realized					R$ Million
	Notional ($ million)					Average			Fair value						Gain/Loss			VaR		Fair value by year
Flow	30-Sep-10		31-Dec-09		Index	rate			30-Sep-10			31-Dec-09			30-Sep-10			30-Sep-10		2010		2011		2012		2013			2014		2015

Swap CDI vs. fixed rate swap
Receivable	$	7,589	$	7,574	CDI		101.20	%		10,843			8,062			371
Payable	USD	3,670	USD	3,670	USD		5.60	%		(9,509	)		(6,959	)		(209	)

Net										1,334			1,103			162			77		1,308		291		277		(385	)		26		(183	)


Swap CDI vs. floating rate swap
Receivable	$	792	$	792	CDI		102.07	%		821			830			53
Payable	USD	430	USD	430	Libor		150	%		(751	)		(739	)		(9	)

Net										70			91			44			4		73		37		38		29			21		(128	)

Type of contracts: OTC Contracts
Protected Item: Debts linked to BRL

The protected items are the Debts linked to BRL because the objective of this protection is to transform the obligations linked to BRL into obligations linked to USD so as to achieve a cash flow currency offset by matching Vale’s receivables (mainly linked to USD) with Vale’s payables.

Protection program for the real denominated debt indexed to TJLP

•

TJLP vs. USD fixed rate swap – In order to reduce the cash flow volatility, Vale entered into swap transactions to convert the cash flows of the loans with Banco Nacional de Desenvolvimento Econômico e Social (BNDES) from TJLP¹ to U.S. Dollars. In those swaps, Vale pays fixed rates in U.S. Dollars and receives payments linked to TJLP.

•

TJLP vs. USD floating rate swap – In order to reduce the cash flow volatility, Vale entered into swap transactions to convert the cash flows of the loans with BNDES from TJLP to U.S. Dollars. In those swaps, Vale pays floating rates in U.S. Dollars and receives payments linked to TJLP.


															Realized					R$ Million
	Notional ($ million)					Average			Fair value						Gain/Loss			VaR		Fair value by year
Flow	30-Sep-10		31-Dec-09		Index	Rate			30-Sep-10			31-Dec-09			30-Sep-10			30-Sep-10		2010		2011		2012		2013		2014-2016			2017-2019

Swap TJLP vs. fixed rate swap
Receivable	$	2,249	$	2,031	TJLP		1.43	%		1,963			1,845			94
Payable	USD	1,158	USD	1,048	USD		3.17	%		(1,928	)		(1,710	)		(65	)

Net										35			135			29			18		29		89		90		32		(154	)		(51	)


Swap TJLP vs. floating rate swap
Receivable	$	720	$	658	TJLP		0.96	%		611			616			12
Payable	USD	375	USD	335	Libor		Libor — 0.46	%		(586	)		(562	)		(6	)

Net										25			54			6			7		2		6		133		26		(61	)		(81	)

Type of contracts: OTC Contracts
Protected Item: Debts linked to BRL


¹		Due to liquidity constraints of the market regarding TJLP derivatives, some derivatives transactions were done through CDI by equivalency.

Foreign Exchange cash flow hedge — Vale

•

Brazilian Real fixed rate vs. USD fixed rate swap – In order to reduce the cash flow volatility, Vale entered into swap transactions to mitigate the foreign exchange exposure that arises from the currency mismatch between the revenues denominated in U.S. Dollars and the disbursements and investments denominated in Brazilian Reais.


															Realized					R$ million
	Notional ($ million)					Average			Fair value						Gain/Loss			VaR		Fair value by year
Flow	30-Sep-10		31-Dec-09		Index	rate			30-Sep-10			31-Dec-09			30-Sep-10			30-Sep-10		2010		2011

Receivable	$	2,608	$	1,964	Fixed		8.08	%		2,739			1,945			1,889
Payable	USD	1,430	USD	1,110	USD		0.00	%		(2,416	)		(1,908	)		(1,748	)

Net										323			37			141			15		323		—

Type of contracts: OTC Contracts
Hedged Item: part of Vale’s revenues in USD

The P&L shown is offset by the hedged items’ P&L due to BRL/USD exchange rate. Again, the final objective of this program, according to the currency hedging strategy at Vale, is to offset the currency exposure of receivables with the currency exposure of payables.

Foreign Exchange cash flow hedge — Albras

•


															Realized					R$ million
	Notional ($ million)								Fair value						Gain/Loss			VaR		Fair value by year
Flow	30-Sep-10		31-Dec-09		Index	Average rate			30-Sep-10			31-Dec-09			30-Sep-10			30-Sep-10		2010		2011

Receivable	$	725	$	711	Fixed		7.17	%		767			699			446
Payable	USD	371	USD	359	USD		0.00	%		(621	)		(608	)		(402	)

Net										146			91			44			4		29		117

Type of contracts: OTC Contracts
Hedged Item: part of Vale’s revenues in USD

Aluminum operations are held for sale since June 2010.

Foreign Exchange Protection Program on cash flow

•

NDFs – In order to reduce the cash flow volatility, Vale entered into non-deliverable forward transactions to mitigate the foreign exchange exposure that arises from the currency mismatch between the revenues denominated in U.S. Dollars and the disbursements and investments denominated in Brazilian Reais.

R$ million

Realized

Fair value

Notional (USD million)

Average rate

Fair value

Gain/Loss

VaR

by year

Flow

30-Sep-10

31-Dec-09

Buy/Sell

(BRL/USD)

30-Sep-10

31-Dec-09

30-Sep-10

2010

Forward

1.8486

3.0

(0.2

)

3.0

0.2

3.0

Type of contracts: OTC Contracts
Protected Item: part of Vale’s revenues in USD

The P&L shown is offset by the protected items’ P&L due to BRL/USD exchange rate. Again, the final objective of this program, according to the currency hedging strategy at Vale, is to offset the currency exposure of receivables with the currency exposure of payables.

Protection program for the Euro denominated floating rate debt

•

Euro floating rate vs. USD floating rate swap — In order to reduce the cash flow volatility, Vale entered into a swap transaction to convert the cash flows from loans in Euros linked to Euribor to U.S. Dollars linked to Libor. This trade was used to convert the cash flow of a debt in Euros, with an outstanding notional amount of € 3.6 million, issued in 2003 by Vale. In this trade, Vale receives floating rates in Euros (Euribor) and pays floating rates in U.S. Dollars (Libor).

Realized

R$ million

Notional ($ million)

Fair value

Gain/Loss

VaR

Fair value by year

Flow

30-Sep-10

31-Dec-09

Index

Average rate

30-Sep-10

31-Dec-09

30-Sep-10

2010

2011

Receivable

€

EUR

Euribor+0,875%

8.3

2.7

Payable

USD

USD

Libor+1,0425%

(6.9

)

(2.5

)

Net

1.4

0.2

0.1

0.5

0.9

Type of contracts: OTC Contracts
Protected Item: Vale’s Debt linked to EUR.

The P&L shown is offset by the hedged items’ P&L due to EUR/USD exchange rate. Again, the final objective of this program, according to the currency hedging strategy at Vale, is to achieve a currency offset matching receivables with payables.

Fair Value hedge program for the Euro denominated fixed rate debt

•

EUR fixed rate vs. USD fixed rate swap: In order to hedge the volatility of debt costs to U.S. Dollars, Vale entered into a swap transaction to convert the cash flows from loans in Euros linked to fixed rate to U.S. Dollars linked to fixed rate. Vale receives fixed rates in Euros and pays fixed rates in U.S. Dollars. This trade was used to convert part of the cash flow of a debt in Euros, with an outstanding notional amount of € 750 million, issued in 2010 by Vale.


														Realized				R$ million
	Notional ($ million)								Fair value					Gain/Loss		VaR		Fair value by year
Flow	30-Sep-10		31-Dec-09		Index	Average rate			30-Sep-10			31-Dec-09		30-Sep-10		30-Sep-10		2011			2012			2013			2014

Receivable	€	500		—	EUR		4.375	%		1,297			—		—
Payable	USD	675		—	USD		4.712	%		(1,314	)		—		—

Net										(17	)		—		—		15		(4	)		(5	)		(4	)		(4	)

Type of contracts: OTC Contracts
Protected Item: Vale’s Debt linked to EUR

Protection program for the USD floating rate debt

In order to reduce the cash flow volatility, Vale Canada Ltd., Vale’s wholly-owned subsidiary, entered into a swap to convert U.S. Dollar floating rate debt into U.S Dollar fixed rate debt. Vale Inco used this instrument to convert the cash flow of a debt issued in 2004 with initial notional amount of US$ 200 million. In this trade, Vale pays fixed rates in U.S. Dollars and receives floating rates in U.S. Dollars (Libor).


															Realized					R$ million
	Notional ($ million)								Fair value						Gain/Loss			VaR		Fair value by year
Flow	30-Sep-10		31-Dec-09		Index	Average rate			30-Sep-10			31-Dec-09			30-Sep-10			30-Sep-10		2010			2011

Receivable	USD	125	USD	200	USD	Libor				212			260			—
Payable					USD		4,795	%		(221	)		(274	)		(9	)

Net										(9	)		(14	)		(9	)		0,1		(2	)		(4	)

Type of contracts: OTC Contracts
Protected Item: Vale Canada’s floating rate debt.

The P&L is offset by the protected items’ P&L due to Libor.

Foreign Exchange protection program for Coal Fixed Price Sales

In order to reduce the cash flow volatility associated with a fixed price coal contract, Vale used Australian Dollar forward purchase in order to equalize production cost and revenues.

Realized

R$ million

Notional ($ million)

Average rate

Fair value

Gain/Loss

VaR

Fair value by year

Flow

30-Sep-10

31-Dec-09

Buy/Sell

(AUD/USD)

30-sep-10

31-Dec-09

30-Sep-10

2010

2011

Forward

AUD

0.66

0.2

Type of contracts: OTC Contracts
Protected Item: part of Vale’s costs in Australian Dollar.

The P&L shown is offset by the protected items’ P&L due to USD/AUD exchange rate. Again, the final objective of this program, according to the currency hedging strategy at Vale, is to achieve a currency offset matching receivables with payables.

Protection Program for Foreign Exchange and Interest on the first nine months of 2010

On March, Vale contracted similar swap transactions in order to reduce the cash flow volatility due to the foreign exchange transaction of the bond issued in Euro. These swaps were hired and settlement on March, when Vale received R$ 3.6 million

Between May and June, Vale entered into swap transactions to protect against the market the changes on the foreign exchange rate between U.S. dollars and Brazilian reais in order to reduce the cash flow volatility due to the foreign exchange transaction of the mandatory convertibles. In these swaps, entered Vale paid a fixed rate in U.S. dollars and received a fixed rate in Brazilian reais. On the maturity date, June 14^th, Vale received R$ 67 million.

On September, Vale contracted interest rate swap transactions in order to fix the treasury used in the pricing of Vale’s 10 year bond emission, neutralizing part of the emission cost. These swaps were acquired and settlement on September, when Vale received R$ 1.5 million.

h) Commodity Derivative Positions

The Company’s cash flow is also exposed to several market risks associated to commodities price volatilities. To reduce the volatility effects, Vale contracted the following derivatives transactions:

Aluminum Strategic cash flow hedging program

In order to hedge our cash flow for 2010, Vale entered into hedging transactions where we set fixed prices for part of Vale revenues for these periods.


																			R$ million
						Average								Realized					Fair value
	Notional (ton)					Strike		Fair value						Gain/Loss			VaR		by year
Flow	30-Sep-10		31-Dec-09		Buy/Sell	(USD/ton)		30-Sep-10			31-Dec-09			30-Sep-10			30-Sep-10		2010

Put		30,000		120,000	B		1,940		0.1			15			0.03
Call		30,000		120,000	S		2,073		(14	)		(62	)		(15	)

Net									(14	)		(47	)		(15	)		2		(14	)


Forward		30,000		120,000	S		1,945		(20	)		(65	)		(31	)		3		(20	)

Type of contracts: OTC Contracts
Protected Item: part of Vale’s revenues linked to Aluminum price

The P&L shown for forwards in the table above is offset by the protected items’ P&L due to Aluminum price. Nevertheless, in case of options, which are non-linear instruments, their P&L is partially compensated by the hedged item’s P&L.
Aluminum operations are held for sale since June 2010.

Nickel Strategic cash flow protection program

In order to protect our cash flow for 2010, Vale entered into hedging transactions where we set fixed prices for part of Vale’s revenues for these periods.

R$ million

Average

Realized

Fair value

Notional (ton)

Strike

Fair value

Gain/Loss

VaR

by year

Flow

30-Sep-10

31-Dec-09

Buy/Sell

(USD/ton)

30-Sep-10

31-Dec-09

30-Sep-10

2010

Forward

7,353

29,122

17,889

(69

)

(36

)

(120

)

(69

)

Type of contracts: OTC and LME Contracts
Protected Item: part of Vale’s revenues linked to Nickel price.

The P&L is offset by the protected items’ P&L due to Nickel price.

Nickel Sales Hedging Program

In order to reduce the cash flow volatility in 2010 and 2011, hedging transactions were implemented. These transactions fixed the prices of part of the sales in the period.

Average

Realized

R$ million

Notional (ton)

Strike

Fair value

Gain/Loss

VaR

Fair value by year

Flow

30-Sep-10

31-Dec-09

Buy/Sell

(USD/ton)

30-Sep-10

31-Dec-09

30-Sep-10

2010

2011

Forward

19,500

—

21,869

(43

)

—

)

(41

)

Type of contracts: OTC Contracts
Protected Item: part of Vale’s revenues linked to Nickel price.

The P&L shown is offset by the protected items’ P&L due to Nickel price.

Nickel Fixed Price Program

In order to maintain the exposure to Nickel price fluctuations, we entered into derivatives to convert to floating prices all contracts with clients that required a fixed price. These trades aim to guarantee that the prices of these operations would be the same as the average prices negotiated on the LME on the date the product is delivered to the client. It normally involves buying Nickel forwards (Over-the-Counter) or futures (exchange negotiated). These operations are usually reverted before the maturity in order to match the settlement dates of the commercial contracts in which the prices are fixed. Whenever the ‘Nickel Strategic cash flow protection program’ or the ‘Nickel Sales Hedging Program’ are executed, the ‘Nickel Fixed Price Program’ is interrupted.

Average

Realized

R$ million

Notional (ton)

Strike

Fair value

Gain/Loss

VaR

Fair value by year

Flow

30-Sep-10

31-Dec-09

Buy/Sell

(USD/ton)

30-Sep-10

31-Dec-09

30-Sep-10

2010

2011

2012

Nickel Futures

2,292

3,426

16,888

Type of contracts: LME Contracts
Protected Item: part of Vale’s revenues linked to fixed price sales of Nickel.

The P&L shown in the table above is offset by the protected items’ P&L due to Nickel price.

Nickel Purchase Protection Program

In order to reduce the cash flow volatility and eliminate the mismatch between the pricing of the purchased nickel (concentrate, cathode, sinter and others) and the pricing of the final product sold to our clients, hedging transactions were implemented. The items purchased are raw materials utilized to produce refined Nickel. The trades are usually implemented by the sale of nickel future contracts on the LME or by forward over-the-counter operations.

Average

Realized

R$ million

Notional (ton)

Strike

Fair value

Gain/Loss

VaR

Fair value by year

Flow

30-Sep-10

31-Dec-09

Buy/Sell

(USD/ton)

30-Sep-10

31-Dec-09

30-Sep-10

2010

2011

Nickel Futures

618

1,446

22,855

(0.4

)

(13

)

(0.4

)

—

Type of contracts: LME Contracts
Protected Item: part of Vale’s revenues linked to Nickel price.

The P&L shown in the table is offset by the protected items’ P&L due to Nickel price.

Bunker Oil Purchase Protection Program

In order to reduce the impact of bunker oil price fluctuation on Vale’s freight hiring and consequently reduce the company’s cash flow volatility, bunker oil derivatives were implemented. These transactions are usually executed through forward purchases.

Average

Realized

R$ million

Notional (mt)

Strike

Fair value

Gain/Loss

VaR

Fair value by year

Flow

30-Sep-10

31-Dec-09

Buy/Sell

(USD/mt)

30-Sep-10

31-Dec-09

30-Sep-10

2010

2011

Forward

345,000

452,000

440

Type of contracts: OTC Contracts
Protected Item: part of Vale’s costs linked to Bunker Oil price.

The P&L shown in the table above is offset by the protected items’ P&L due to Bunker Oil price.

Maritime Freight Hiring Protection Program

In order to reduce the impact of maritime freight price fluctuation hired to support CIF and CFR sales and consequently reduce the company’s cash flow volatility, freight derivatives (FFA — Forward Freight Agreement) were implemented. These transactions are usually executed through forward purchases.

R$ million

Average

Realized

Fair value

Notional (days)

Strike

Fair value

Gain/Loss

VaR

by year

Flow

30-Sep-10

31-Dec-09

Buy/Sell

(USD/day)

30-Sep-10

31-Dec-09

30-Sep-10

2010

Forward

1,748

6,125

30,634

Type of contracts: OTC Contracts
Protected Item: part of Vale’s costs linked to Freight price.

The P&L is offset by the protected items’ P&L due to Freight price.

Coal Sales Protection Program

In order to reduce the cash flow volatility for 2010, Vale entered into hedging transactions to fix the price of a portion of coal sales during the period.

R$ million

Average

Realized

Fair value

Notional (mt)

Strike

Fair value

Gain/Loss

VaR

by year

Flow

30-Sep-10

31-Dec-09

Buy/Sell

(USD/mt)

30-Sep-10

31-Dec-09

30-Sep-10

2010

Forward

120,000

—

)

—

)

0.3

)

Type of contracts: OTC Contracts
Protected Item: part of Vale’s revenues linked to Coal price.

The P&L shown is offset by the protected items’ P&L due to Coal price.

Copper Scrap Purchase Protection Program

This program was implemented in order to reduce the cash flow volatility due to the quotation period mismatch between the pricing period of copper scrap purchase and the pricing period of final products sale to the clients, as the copper scrap is combined with other raw materials or inputs to produce copper. This program is usually implemented by the sale of futures on the LME or by forwards through Over-the-Counter operations.

Average

Realized

R$ million

Notional (lbs)

Strike

Fair value

Gain/Loss

VaR

Fair value by year

Flow

30-Sep-10

31-Dec-09

Buy/Sell

(USD/Ibs)

30-Sep-10

31-Dec-09

30-Sep-10

2010

2011

Forward

515,300

—

(0.6

)

—

0.12

0.1

(0.3

)

(0.3

)

Tipo de contrato: OTC Contracts
Item protegido: part of Vale’s revenues linked to Copper price.

The P&L shown is offset by the protected items’ P&L due to Copper price.

i) Embedded Derivative Positions

The Company’s cash flow is also exposed to several market risks associated with contracts that contain embedded derivatives or derivative-like features. From Vale’s perspective, it may include, but is not limited to, commercial contracts, procurement contracts, rental contracts, bonds, insurance policies and loans. The following embedded derivatives were observed in 2010:

Energy purchase

Energy purchase agreement between Albras, Vale’s controlled subsidiary, and Eletronorte, in which there’s a clause that defines that a premium can be charged if aluminum prices trades in the range from US$ 1,450/t until US$ 2,773/t. This clause is considered as an embedded derivative.

Average

Realized

R$ million

Notional (ton)

strike

Fair value

Gain/Loss

VaR

Fair value by year

Flow

30-Sep-10

31-Dec-09

Buy/Sell

(USD/ton)

30-Sep-10

31-Dec-09

30-Sep-10

2010

2011

2012

Call

200,228

2,773

Call

200,228

1,450

(322

)

(299

)

Total

(281

)

(254

)

—

(110

)

(138

)

(33

)

Aluminum operations are held for sale since June 2010.

Raw material and intermediate products purchase

Nickel concentrate and raw materials purchase agreements in which there are provisions based on nickel and copper future prices behavior. These provisions are considered as embedded derivatives.


																		R$ million
						Average								Realized				Fair value
	Notional (ton)					Strike		Fair value						Gain/Loss		VaR		by year
Flow	30-Sep-10		31-Dec-09		Buy/Sell	(USD/ton)		30-Sep-10			31-Dec-09			30-Sep-10		30-Sep-10		2010

Nickel Forwards		1,222		440			21,792		(2	)		0.3			5				(2	)
Copper Forwards		5,223		3,463	S		7,226		(4	)		(1.7	)		3				(4	)

Total									(6	)		(1.4	)		8		2		(6	)

j) Derivative Positions from jointly controlled companies

Below we present the fair values of the derivatives from jointly controlled companies. These instruments are managed under the risk policies of each company. However the nominal amounts and the effects of mark-to-market are recognized in financial statements to the extent of Vale’s share in each one of these companies.

Protection program

In order to reduce the cash flow volatility, swap transactions was contracted to convert into Reais the cash flows from debt instruments denominated in US Dollars. In this swap, fixed rates in U.S. Dollars are received and payments linked to Reais (CDI index) are made.


															R$ million
	Notional ($ million)								Fair Value						VaR
Flow	30-Sep-10		31-Dec-09		Index	Average rate			30-Sep-10			31-Dec-09			30-Sep-10

Swap fixed rate vs. CDI
Receivable	USD 106		USD 114		USD		2.57	%		186			210
Payable	$	206	$	245	CDI		100.28	%		(230	)		(272	)

Net										(44	)		(62	)		1

Type of contracts: OTC Contracts
Protected Item: Debts indexed to USD

The P&L shown is offset by the protected items’ P&L due to BRL/USD exchange rate.

Hedging program

Swap transactions to fix the rate of part of a USD denominated obligation linked to Libor USD were contracted. In this swap, floating rates (Libor USD) in US Dollars are received and payments linked to a fixed rate also in US Dollars are made.

R$ million

Notional ($ million)

Fair Value

VaR

Flow

30-Sep-10

31-Dec-09

Index

Average rate

30-Sep-10

31-Dec-09

30-Sep-10

Swap USD floating rate vs. fixed

Receivable

USD 20

Libor

Libor + 0,65

23.3

30.0

Payable

Fixed

3.98

(24.1

)

(30.9

)

Net

(0.8

)

(0.9

)

0.01

Type of contracts: OTC Contracts
Hedged Item: Debts indexed to Libor USD

The P&L shown is offset by the hedged items’ P&L due to fluctuations in the Libor USD rate.

k) Sensitivity Analysis on Derivatives

The table presents potential gain/loss of all our outstanding positions on September 30, 2010 considering the following stress scenarios:

•

Fair Value: it is the mark to market value of the instruments on September 30, 2010;

•

Scenario I: unfavorable change of 25% — Potential losses considering a shock of 25% in the market risk factors used for fair value calculation that negatively impacts the fair value of Vale’s derivatives positions;

•

Scenario II: favorable change of 25% — Potential profits considering a shock of 25% in the market curves used for fair value calculation that positively impacts the fair value of Vale’s derivatives positions;

•

Scenario III: unfavorable change of 50% — Potential losses considering a shock of 50% in the market curves used for fair value calculation that negatively impacts the fair value of Vale’s derivatives positions;

•

Scenario IV: favorable change of 50% — Potential profits considering a shock of 50% in the market curves used for fair value calculation that positively impacts the fair value of Vale’s derivatives positions;



Sensitivity analysis — Foreign Exchange and interest Rate Derivative Positions		Amounts in R$ million


Program	Instrument	Risk	Fair Value	Scenario I			Scenario II			Scenario III			Scenario IV
Protection program for the Real denominated debt indexed to CDI	CDI vs. USD fixed rate swap	USD/BRL fluctuation			(1,633	)		1,633			(3,264	)		3,264
		USD interest rate inside Brazil variation	1,334		(71	)		73			(141	)		147
		Brazilian interest rate fluctuation			(2	)		1			(2	)		3
		USD Libor variation			(3	)		3			(7	)		7
	CDI vs. USD floating rate swap	USD/BRL fluctuation			(188	)		188			(375	)		375
		Brazilian interest rate fluctuation	70		0.06			0.06			0.27			0.21
		USD Libor variation			(0.1	)		0.0			(0.2	)		(0.1	)
	Protected Items — Debt indexed to CDI	USD/BRL fluctuation	n.a.		—			—			—			—
Protection program for the Real denominated debt indexed to TJLP	TJLP vs. USD fixed rate swap	USD/BRL fluctuation			(482	)		482			(964	)		964
		USD interest rate inside Brazil variation	35		(27	)		26			(55	)		51
		Brazilian interest rate fluctuation			(69	)		75			(133	)		158
		TJLP interest rate fluctuation			(77	)		76			(154	)		151
	TJLP vs. USD floating rate swap	USD/BRL fluctuation			(147	)		147			(293	)		293
		USD interest rate inside Brazil variation			(9	)		9			(19	)		17
		Brazilian interest rate fluctuation	25		(17	)		19			(33	)		39
		TJLP interest rate fluctuation			(40	)		40			(80	)		80
		USD Libor variation			(15	)		15			(31	)		31
	Protected Items — Debts indexed to TJLP	USD/BRL fluctuation	n.a.		—			—			—			—
Foreign Exchange cash flow hedge — Vale	BRL fixed rate vs. USD	USD/BRL fluctuation			(604	)		604			(1,208	)		1,208
		USD interest rate inside Brazil variation	323		(2	)		2			(3	)		3
		Brazilian interest rate fluctuation			(8	)		9			(16	)		17
	Hedged Items — Part of Revenues denominated in USD	USD/BRL fluctuation	n.a.		604			(604	)		1,208			(1,208	)
Foreign Exchange cash flow hedge — Albras	BRL fixed rate vs. USD	USD/BRL fluctuation			(155	)		155			(310	)		310
		USD interest rate inside Brazil variation	146		(2	)		2			(3	)		3
		Brazilian interest rate fluctuation			(10	)		11			(20	)		22
	Hedged Items — Part of Revenues denominated in USD	USD/BRL fluctuation	n.a.		155			(155	)		310			(310	)
Foreign Exchange Protection Program on cash flow	Non-deliverable forward	USD/BRL fluctuation			(8	)		8			(17	)		17
		USD interest rate inside Brazil variation	3.0		0.00			0.00			0.00			0.00
		Brazilian interest rate fluctuation			0.0			0.0			0.0			0.0
	Protected Items — Part of Revenues denominated in USD	USD/BRL fluctuation	n.a.		8			(8	)		17			(17	)
Protection Program for the Euro denominated floating rate debt	EUR floating rate vs. USD floating rate swap	USD/BRL fluctuation			(0.4	)		0.4			(0.7	)		0.7
		EUR/USD fluctuation	1.4		(2	)		2			(4	)		4
		EUR Libor variation			(0.00	)		0.00			(0.01	)		0.01
		USD Libor variation			(0.00	)		0.00			(0.00	)		0.00
	Protected Items — Debts indexed to EUR	EUR/USD fluctuation	n.a.		2			(2	)		4			(4	)
Fair Value hedge program for the Euro denominated fixed rate debt	EUR fixed rate vs. USD fixed rate swap	USD/BRL fluctuation			(1	)		1			(1	)		1
		EUR/USD fluctuation	(17)		(329	)		329			(658	)		658
		EUR Libor variation			(9	)		9			(18	)		19
		USD Libor variation			(11	)		11			(22	)		21
	Protected Items — Debts indexed to EUR	EUR/USD fluctuation	n.a.		329			(329	)		658			(658	)
Protection Program for the USD floating rate debt	USD floating rate vs. USD fixed rate swap	USD/BRL fluctuation			(2	)		2			(5	)		5
		USD Libor variation	(9)		(0	)		0			(0	)		1
	Protected Items — Vale Inco’s Floating rate debt	USD Libor variation	n.a.		0			(0	)		0			(1	)
Foreign Exchange Protection Program on Coal Fixed Price Sales	Australian dollar forwards	USD/AUD fluctuation			(4	)		4			(8	)		8
		USD/BRL fluctuation	5		(1	)		1			(2	)		2
		Libor USD fluctuation			0.00			0.00			0.00			0.00
	Protected Item: Part of Vale’s costs in Australian Dollar	USD/AUD fluctuation	n.a.		4			(4	)		8			(8	)



Sensitivity analysis — Commodity Derivative Positions		Amounts in R$ million


Program	Instrument	Risk	Fair Value	Scenario I			Scenario II			Scenario III			Scenario IV
Aluminum strategic cash flow protection program	Aluminum options collars	Aluminum price fluctuation			(29	)		24			(59	)		53
		Libor USD fluctuation	(14)		(0.002	)		0.002			(0.003	)		0.003
		BRL/USD fluctuation			(3	)		3			(7	)		7
	Sale of aluminum forward contracts	Aluminum price fluctuation			(30	)		30			(59	)		59
		Libor USD fluctuation	(20)		(0.01	)		0.01			0.00			0.00
		BRL/USD fluctuation			(5	)		5			(10	)		10
	Protected Items — Part of Vale’s revenues linked to Aluminum price	Aluminum price fluctuation	n.a.		59			(54	)		118			(112	)
Nickel strategic cash flow protection program	Sale of nickel future/forward contracts	Nickel price fluctuation			(73	)		73			(146	)		146
		Libor USD fluctuation	(69)		0.0			0.0			0.0			0.0
		BRL/USD fluctuation			(17	)		17			(34	)		34
	Protected Item: Part of Vale’s revenues linked to Nickel price	Nickel price fluctuation	n.a.		73			(73	)		146			(146	)
Nickel sales hedging program	Sale of nickel future/forward contracts	Nickel price fluctuation			(191	)		191			(382	)		382
		Libor USD fluctuation	(43)		(1	)		1			(2	)		2
		USD/BRL fluctuation			(11	)		11			(22	)		22
	Hedged Item: Part of Vale’s revenues linked to Nickel price	Nickel price fluctuation	n.a.		191			(191	)		382			(382	)
Nickel fixed price program	Purchase of nickel future/forward contracts	Nickel price fluctuation			(23	)		23			(45	)		45
		Libor USD fluctuation	25
		USD/BRL fluctuation			(6	)		6			(13	)		13
	Protected Item: Part of Vale’s nickel revenues from sales with fixed prices	Nickel price fluctuation	n.a.		23			(23	)		45			(45	)
Nickel purchase protection program	Sale of nickel future/forward contracts	Nickel price fluctuation			(6	)		6			(12	)		12
		Libor USD fluctuation			(0.001	)		0.001			(0.003	)		0.003
		USD/BRL fluctuation	(0.4)		(0.1	)		0.1			(0.3	)		0.3
	Protected Item: Part of Vale’s revenues linked to Nickel price	Nickel price fluctuation	n.a.		6			(6	)		12			(12	)
Bunker Oil Purchase Protection Program	Bunker Oil forward	Bunker Oil price fluctuation			(68	)		63			(136	)		136
		Libor USD fluctuation	15		(0.2	)		0.2			(0.5	)		0.5
		USD/BRL fluctuation			(4	)		4			(7	)		7
	Protected Item: part of Vale’s costs linked to Bunker Oil price	Bunker Oil price fluctuation	n.a.		68			(68	)		136			(136	)
Maritime freight hiring protection program	Forward freight agreement	Freight price fluctuation			(24	)		24			(47	)		47
		Libor USD fluctuation	4		(0.0	)		0.0			0.0			0.0
		USD/BRL fluctuation			(1	)		1			(2	)		2
	Protected Item: part of Vale’s costs linked to Freight price	Freight price fluctuation	n.a.		24			(24	)		47			(47	)
Coal Sales Protection Program	Sale of Coal forward contracts	Coal price fluctuation			(5	)		5			(9	)		9
		Libor USD fluctuation	(1)		(0.00	)		0.00			(0.00	)		0.00
		USD/BRL fluctuation			(0	)		0			(1	)		1
	Protected Item: part of Vale’s revenues linked to Freight price	Coal price fluctuation	n.a.		5			(5	)		9			(9	)
Copper Scrap Purchase Protection Program	Sale of copper future/forward contracts	Copper price fluctuation			(1	)		1			(2	)		2
		Libor USD fluctuation	(0.6)		0.000			0.000			(0.001	)		0.001
		BRL/USD fluctuation			(0.1	)		0.1			(0.2	)		0.2
	Protected Item: Part of Vale’s revenues linked to Copper price	Copper price fluctuation	n.a.		1			(1	)		2			(2	)



Sensitivity analysis — Embedded Derivative Positions		Amounts in R$ million


Program	Instrument	Risk	Fair Value	Scenario I			Scenario II			Scenario III			Scenario IV
Embedded derivatives — Raw material purchase (Niquel)	Embedded derivatives — Raw material purchase	Nickel price fluctuation			(12	)		12			(24	)		24
		BRL/USD fluctuation	(2)		(1	)		1			(2	)		2
Embedded derivatives — Raw material purchase (Cobre)	Embedded derivatives — Raw material purchase	Copper price fluctuation			(18	)		18			(35	)		35
		BRL/USD fluctuation	(4)		(2	)		2			(4	)		4
Embedded derivatives — Energy purchase	Embedded derivatives — Energy purchase — Aluminum Options	Aluminum price fluctuation			(109	)		155			(153	)		256
		BRL/USD fluctuation	(281)		(67	)		67			(134	)		134

l) Sensitivity Analysis on Derivatives from jointly controlled companies
							Amount.in R$ million

Program	Instrument	Risk	Fair Value	Scenario I			Scenario II			Scenario III			Scenario IV
Protection program	CDI vs. USD fixed rate swap	USD/BRL fluctuation			(42	)		42			(84	)		84
		USD interest rate inside Brazil variation	(44)		(0.3	)		0.3			(0.7	)		0.7
		Brazilian interest rate fluctuation			0.00			0.00			(0.01	)		0.01
	Protected Item — Debt indexed to USD	USD/BRL fluctuation	n.a.		42			(42	)		84			(84	)
Hedging program	USD floating rate vs. USD fixed rate swap	USD/BRL fluctuation	(0.8)		(0.2	)		0.2			(0.4	)		0.4
		USD Libor variation			(0.0	)		0.0			(0.1	)		0.1
	Hedged item — Debt indexed to Libor	USD Libor variation	n.a.		0.0			(0.0	)		0.1			(0.1	)

m) Sensitivity Analysis on Debt and Cash Investments

The Company’s funding and cash investments linked to currencies different from Brazilian Reais are subjected to volatility of foreign exchange currencies, such as EUR/USD and USD/BRL.

Amounts in R$ million


Program	Instrument	Risk	Scenario I			Scenario II		Scenario III			Scenario IV
Funding	Debt denominated in BRL	No fluctuation
Funding	Debt denominated in USD	USD/BRL fluctuation		(6,943	)		6,943		(13,886	)		13,886
Funding	Debt denominated in EUR	EUR/USD fluctuation		(5	)		5		(10	)		10
Cash Investments	Cash denominated in BRL	No fluctuation
Cash Investments	Cash denominated in USD	USD/BRL fluctuation		(2,401	)		2,401		(4,803	)		4,803

n) Credit risk on financial trades and financial institutions ratings

Derivatives transactions are executed with financial institutions that we consider to have a very good credit quality. The exposure limits to financial institutions are proposed annually for the Executive Risk Committee and approved by the Executive Board. The financial institutions credit risk tracking is performed making use of a credit risk valuation methodology which considers, among other information, published ratings provided by international rating agencies. In the table below, we present the ratings in foreign currency published by Moody’s e S&P agencies for the financial institutions that we had outstanding trades as of September 30, 2010.


Parent Company	Vale’s Counterparty	Moody’s	S&P*

JP Morgan Chase & Co**	JP Morgan Chase Bank	Aa3	A+
Banco Santander SA	Banco Santander SA	Aa2	AA
Banco Santander SA	Banco Santander Brasil SA	Baa3	BBB-
BNP Paribas**	BNP Paribas Securities Corp	Aa2	AA
BNP Paribas	BNP Paribas	Aa2	AA
The Goldman Sachs Group Inc**	J Aron & Co	A1	A
Itau Unibanco Holding SA	Banco Itau BBA SA	A2	—
Societe Generale**	Banco Societe Generale do Brasil SA	Aa2	A+
Societe Generale	Societe Generale	Aa2	A+
Credit Agricole SA**	Calyon (London)	Aa1	AA-
Banco Votorantim SA	Banco Votorantim SA	A3	BB+
Itau Unibanco Holding SA**	União de Bancos Brasileiros SA	A2	—
Banco do Brasil SA	Banco do Brasil SA	A2	BBB-
Citigroup Inc**	Citibank NA (Brazil)	A1	A+
Deutsche Bank AG**	Deutsche Bank AG (London)	Aa3	A+
HSBC Holdings plc**	HSBC Bank Brasil SA — Banco Multiple	Aa2	AA-
Barclays PLC	Barclays Bank PLC	Aa3	A+
Banco Santander SA**	Banco ABN AMRO Real SA	Aa2	AA
Standard Bank PLC**	Standard Intenational Holding	Baa2	—
Banco Bradesco SA	Banco Bradesco SA	A1	BBB
BNP Paribas**	BNP Paribas Energy & Commodities	Aa2	AA
Prudential Financial Inc**	Prudential Bache Commodities Ltd (London)	Baa2	A
Natixis**	Natixis Metals Limited	Aa3	A+
Mitsui Co Ltd**	Mitsui Bussan Commodities Ltd	A2	A+


*		For brazilian Banks we used local long term deposit rating

**		Parent company’s rating

o) Market Curves

To build the curves used on the pricing of the derivatives, public data from BM&F, Central Bank of Brazil, London Metals Exchange (LME) and proprietary data from Thomson Reuters, Bloomberg L.P. and Enerdata were used.

1. Commodities

Aluminum


Maturity	Price (USD/ton)		Maturity		Price (USD/ton)		Maturity		Price (USD/ton)
SPOT		2,322		JUL11		2,392		MAY12		2,448
OCT10		2,329		AUG11		2,398		JUN12		2,453
NOV10		2,341		SEP11		2,405		JUL12		2,458
DEC10		2,350		OCT11		2,411		AUG12		2,463
JAN11		2,359		MOV11		2,418		SEP12		2,468
FEB11		2,363		DEC11		2,422		OCT12		2,473
MAR11		2,368		JAN12		2,428
APR11		2,375		FEB12		2,433
MAY11		2,380		MAR12		2,438
JUN11		2,385		APR12		2,443

Nickel


Maturity	Price (USD/ton)		Maturity		Price (USD/ton)		Maturity		Price (USD/ton)
SPOT		23,406		JUL11		23,244		MAY12		22,410
OCT10		23,420		AUG11		23,158		JUN12		22,330
NOV10		23,380		SEP11		23,072		JUL12		22,253
DEC10		23,400		OCT11		22,986		AUG12		22,176
JAN11		23,425		NOV11		22,900		SEP12		22,099
FEB11		23,405		DEC11		22,815		OCT12		22,022
MAR11		23,390		JAN12		22,734
APR11		23,370		FEB12		22,653
MAY11		23,350		MAR12		22,572
JUN11		23,330		APR12		22,491

Copper

Maturity

Price (USD/ton)

Maturity

Price (USD/ton)

Maturity

Price (USD/ton)

SPOT

3.65

DEC10

3.66

FEB11

3.66

OCT10

3.65

JAN11

3.66

MAR11

3.67

NOV10

3.65

Bunker Oil


Maturity	Price (USD/ton)		Maturity		Price (USD/ton)		Maturity		Price (USD/ton)
SPOT		453		JUL11		478		MAY12		496
OCT10		453		AUG11		478		JUN12		496
NOV10		452		SEP11		478		JUL12		496
DEC10		451		OCT11		484		AUG12		496
JAN11		461		NOV11		484		SEP12		496
FEB11		461		DEC11		484		OCT12		496
MAR11		461		JAN12		496
APR11		470		FEB12		496
MAY11		470		MAR12		496
JUN11		470		APR12		496

Aluminum — Volatility


Maturity	Vol (%a.a.)		Maturity		Vol (%a.a.)		Maturity		Vol (%a.a.)
VOLSPOT		24.4		VOL9M		27.2		VOL4A		24.4
VOL1M		27.1		VOL1A		26.9		VOL5A		23.9
VOL3M		27.7		VOL2A		25.9		VOL7A		23.9
VOL6M		27.5		VOL3A		25.1		VOL10A		23.9

FFA — Forward Freight Agreement


Maturity	Price (USD/day)		Maturity		Price (USD/day)		Maturity		Price (USD/day)
SPOT		31,942		JUL11		25,906		MAY12		24,666
OCT10		32,016		AUG11		25,906		JUN12		24,666
NOV10		32,191		SEP11		25,906		JUL12		24,666
DEC10		31,703		OCT11		26,247		AUG12		24,666
JAN11		28,125		NOV11		26,247		SEP12		24,666
FEB11		28,125		DEC11		26,247		OCT12		24,666
MAR11		28,125		JAN12		24,666
APR11		27,063		FEB12		24,666
MAY11		27,063		MAR12		24,666
JUN11		27,063		APR12		24,666

Coal


Maturity	Price (USD/ton)		Maturity		Price (USD/ton)		Maturity		Price (USD/ton)
SPOT		88.5		JUL11		95.0		MAY12		100
OCT10		87		AUG11		95.0		JUN12		100
NOV10		88.5		SEP11		95.0		JUL12		100
DEC10		89.25		OCT11		96.8		AUG12		100
JAN11		90.3		NOV11		96.8		SEP12		100
FEB11		91.0		DEC11		96.8		OCT12
MAR11		91.0		JAN12		100.0
APR11		93.3		FEB12		100.0
MAY11		93.3		MAR12		100.0
JUN11		93.3		APR12		100.0

2. Rates

USD-Brazil Interest Rate


Maturity	Rate (% a.a.)		Maturity		Rate (% a.a.)		Maturity		Rate (% a.a.)
11/1/2010		2.40		10/1/2012		2.34		4/1/2015		3.27
12/1/2010		2.18		1/2/2013		2.45		7/1/2015		3.36
1/3/2011		2.07		4/1/2013		2.49		10/1/2015		3.43
2/1/2011		1.95		7/1/2013		2.55		1/4/2016		3.46
4/1/2011		1.96		10/1/2013		2.64		7/1/2016		3.61
7/1/2011		1.98		1/2/2014		2.71		1/2/2017		3.76
10/3/2011		2.01		4/1/2014		2.84		1/2/2018		4.00
1/2/2012		2.07		7/1/2014		2.96		1/2/2019		4.07
4/2/2012		2.11		10/1/2014		3.04		1/2/2020		4.23
7/2/2012		2.22		1/2/2015		3.18		1/4/2021		4.41

US Interest Rate


Maturity	Rate (% a.a.)		Maturity		Rate (% a.a.)		Maturity		Rate (% a.a.)
USD1M		0.26		USD6M		0.46		USD11M		0.71
USD2M		0.27		USD7M		0.51		USD12M		0.77
USD3M		0.29		USD8M		0.56		USD2A		0.51
USD4M		0.34		USD9M		0.61		USD3A		0.75
USD5M		0.41		USD10M		0.66		USD4A		1.06

TJLP


Maturity	Rate (% a.a.)		Maturity		Rate (% a.a.)		Maturity		Rate (% a.a.)
10/1/2010		6.00		10/1/2012		6.00		10/1/2014		6.00
11/1/2010		6.00		1/1/2013		6.00		1/1/2015		6.00
1/1/2011		6.00		4/1/2013		6.00		4/1/2015		6.00
4/1/2011		6.00		7/1/2013		6.00
7/1/2011		6.00		10/1/2013		6.00

BRL Interest Rate


Maturity	Rate (% a.a.)		Maturity		Rate (% a.a.)		Maturity		Rate (% a.a.)
10/11/2010		10.64		1/2/2012		11.43		1/2/2014		11.75
11/1/2010		10.64		4/2/2012		11.58		4/1/2014		11.72
12/1/2010		10.63		7/2/2012		11.74		7/1/2014		11.74
1/3/2011		10.65		10/1/2012		11.83		10/1/2014		11.70
2/1/2011		10.67		1/2/2013		11.82		1/2/2015		11.68
4/1/2011		10.72		4/1/2013		11.81		4/1/2015		11.66
7/1/2011		10.94		7/1/2013		11.80		7/1/2015		11.64
10/3/2011		11.23		10/1/2013		11.77		10/1/2015		11.62

3. Currencies

EURO


Maturity	EUR/USD		Maturity		EUR/USD		Maturity		EUR/USD
EURSPOT		1.36		EUR9M		1.36		EUR4A		1.35
EUR1M		1.36		EUR1A		1.36		EUR5A		1.36
EUR3M		1.36		EUR2A		1.35		EUR7A		1.38
EUR6M		1.36		EUR3A		1.35		EUR10A		1.41

AUD


Maturity	AUD/USD		Maturity		AUD/VSD		Maturity		AUD/USD
AUDSPOT		0.96		AUD9M		0.93		AUD4A		0.81
AUD1M		0.96		AUD1A		0.92		AUD5A		0.79
AUD3M		0.95		AUD2A		0.88		AUD7A		0.75
AUD6M		0.94		AUD3A		0.84		AUD10A		0.71

Currencies — Ending rates


USD/CAD			1.0340			USD/BRL					1.6942			EUR/USD					1.3622


	Consolidated																Parent Company
	Assets								Liabilities								Asset
	September 30, 2010								September 30, 2010								September 30, 2010		December 31,
	(unaudited)				31-Dec-09				(unaudited)				December 31, 2009				(unaudited)		2009
	Current		Non current		Current		Non current		Current		Non current		Current		Non current		Non current		Non current
Derivatives not designated as hedge
Foreign exchange and interest rate risk
CDI & TJLP vs. USD fixed and floating rate swaps		—		1,464,198		—		1,383,611		—		—		—		—		1,156,456		1,058,303
Euro floating rate vs. USD floating rate swap		—		1,432		—		2,559		—		—		—		—		1,432		2,559
USD floating rate vs. CDI		—		—		—		—		44,209		—		38,829		23,364		—		—
USD vs. fixed rate swap		—		—		—		—		688		291		926		—		—		—
NDF swap		3,023		—		—		—		—		—		160		—		—		—
USD floating rate vs. USD fixed rate swap		—		—		—		—		—		8,812		12,003		2,159		—		—
EuroBonds swap		—		—		—		—		—		17,376		—		—		—		—
AUD forward purchase		4,856		—		—		14,946		—		—		—		—		—		—

		7,879		1,465,630		—		1,401,116		44,897		26,479		51,918		25,523		1,157,888		1,060,862
Fixed price purchase/ sale		23,735		493		21,780		2,909		21,620		430		4,495		13,687		—		—
Strategic program		—		—		—		—		86,560		—		55,553		—		—		—
Maritime freight hiring protection program		8,159		—		50,448		—		—		—		—		—		—		—
Aluminium		—		—		—		—		—		—		27,640		466		—		—
Bunker oil		—		17,598		84,573		—		—		—		—		—		—		—
Coal		—		—		—		—		1,892		—		—		—		—		—
Copper		—		—		—		—		637		—		—		—		—		—

		31,894		18,091		156,801		2,909		110,709		430		87,688		14,153		—		—
Derivatives designated as hedge
Cash flow hege		—		323,077		26,131		102,059		—		—		—		—		323,077		36,828
Strategic nickel		—		—		—		—		—		43,337		—		—		—		—
Aluminium		—		—		—		—		—		—		123,989		—		—		—

		—		323,077		26,131		102,059		—		43,337		123,989		—		323,077		36,828

Total		39,773		1,806,798		182,932		1,506,084		155,606		70,246		263,595		39,676		1,480,965		1,097,690

The effects of derivatives on equity

The effects of hedge accounting that affects the stockholders’ equity are as follows:


					Consolidated (Nine months)
	Moeda		Alumínio		Niquel		Total
Balance on January 31, 2009		—		—		—		—
Fair value measurement		13,504		10,691		—		24,195

Total period variance		13,504		10,691		—		24,195

Balance on September 30, 2009		13,504		10,691		—		24,195


							Consolidated (Nine months)
	Moeda			Alumínio			Niquel			Total
Balance on January 31, 2010		68,603			(63,234	)		—			5,369
Fair value measurement		238,815			(8,836	)		(43,336	)		186,643
Transference to financial results due to settlement		(43,957	)		51,625			—			7,668

Total period variance		194,858			42,789			(43,336	)		194,311

Balance on September 30, 2010		263,461			(20,445	)		(43,336	)		199,680

The effects of derivatives on income statement


	Amount of gain or (loss) recognized in financial income (expense)
	Consolidated												Parent Company
	As of and for the three-month
	period ended
	(unaudited)						Accumulated (unaudited)						Accumulated (unaudited)
	September 30,			September 30,			September 30,			September 30,			September 30,			September 30,
	2010			2009			2010			2009			2010			2009
Derivatives not designated as hedge
Foreign exchange and interest rate risk
CDI & TJLP vs. USD fixed and floating rate swaps		753,701			825,110			324,524			2,819,615			256,954			2,240,067
USD floating rate vs. USD fixed rate swap		(16,460	)		(2,728	)		(17,671	)		(3,892	)		—			—
Euro floating rate vs. USD floating rate swap		813			240			(907	)		(316	)		(907	)		(317	)
AUD forward purchase		2,513			4,874			4,085			23,703			—			—
USD floating rate vs. CDI		(190	)		—			(798	)		—			—			—
NDF swap		5,464			—			6,464			—			—			—
Floating Libor vs. fixed Libor swap		(977	)		—			(3,334	)		—			—			—
EuroBonds swap		125,214			—			(15,874	)		—			—			—
Swap Convertibles		—			—			67,111			—			67,111			—
Commodities price risk
Nickel
Fixed price purchase/ sale		(9,159	)		27,642			8,100			92,489			—			—
Nickel purchase program		—			(24,111	)		—			(87,592	)		—			—
Strategic program		(62,308	)		(91,706	)		(154,086	)		(174,531	)		—			—
Copper scraps/ strategic copper		(1,212	)		(48	)		(663	)		(606	)		—			—
Strategic copper		—			—			—			—			—			—
Natural gas		—			(889	)		—			(8,941	)		—			—
Maritime freight hiring protection program		16,114			(82,651	)		(17,885	)		(13,078	)		—			17,469
Bunker oil		6,651			18,743			(17,969	)		43,584			—			—
Coal		2,139			—			(3,532	)		—			—			—
Embedded derivatives
Fixed price nickel sales		—			(23,237	)		—			(150,198	)		—			—
Customer raw material purchase		—			(16,694	)		—			(47,269	)		—			—
Energy purchase — aluminum options		(76,600	)		—			(76,134	)		—			—			—

Derivatives designated as hedge
Cash flow hedge		107,415			—			140,789			—			140,788			—

		853,118			634,545			242,220			2,492,968			463,946			2,257,219


	Consolidated
	As of and for the three-month												Financial settlement
	period ended												Parent Company
	(unaudited)						Accumulated (unaudited)						Accumulated (unaudited)
	September 30,			September 30,
	2010			2009			30/09/10			30/09/09			30/09/10			30/09/09

Foreign exchange and interest rate risk
CDI & TJLP vs. USD fixed and floating rate swaps		(58,626	)		(56,956	)		(243,936	)		(315,448	)		(158,801	)		(237,105	)
USD floating rate vs. USD fixed rate swap		2,382			3,904			8,513			11,301			—			—
Euro floating rate vs. USD floating rate swap		—			—			(221	)		(894	)		(221	)		(894	)
AUD forward purchase		(1,588	)		(2,434	)		(14,176	)		(5,272	)		—			—
USD floating rate vs. CDI		2,905			—			35,654			—			—			—
NDF swap		(3,281	)		—			(3,281	)		—			—			—
Floating Libor vs. fixed Libor swap		190			—			664			—			—			—
EuroBonds swap		(1,502	)					(1,502	)		—			—			—
Swap Convertibles		—			—			(67,110	)		—			(67,111	)		—
Commodities price risk
Nickel
Fixed price purchase/ sale		(14,436	)		18,937			(12,128	)		91,037			—			—
Strategic program		27,990			65,703			117,340			65,703			—			—
Copper scraps/ strategic copper		(118	)		174			(118	)		(54	)		—			—
Natural gas		—			3,319			—			10,930			—			—
Maritime freight hiring protection program		10,690			(46,680	)		(24,405	)		(56,809	)		—			(17,471	)
Bunker oil		(7,731	)		(9,894	)		(49,007	)		(11,357	)		—			—
Aluminum		—			—			27,640			—			—			—
Coal		1,067			—			1,641			—			—			—
Derivatives designated as hedge
Cash flow hedge		(130,031	)		—			(184,746	)		—			(140,788	)		—
Aluminium		5,285			—			51,626			—			—			—

		(166,804	)		(23,927	)		(357,552	)		(210,863	)		(366,921	)		(255,470	)

The maturities dates of the consolidated financial instruments are as follows:


Interest rates / Currencies		Janeiro de 2015
Aluminum		Dezembro de 2010
Bunker Oil		Dezembro de 2011
Freight		Dezembro de 2010
Copper		Julho de 2012
Coal		Dezembro de 2010
Copper		Janeiro de 2011

Board of Directors, Fiscal Council, Advisory committees and Executive Officers


Board of Directors		Governance and Sustainability Committee
		Jorge Luiz Pacheco
Sérgio Ricardo Silva Rosa		Renato da Cruz Gomes
Chairman		Ricardo Simonsen

Mário da Silveira Teixeira Júnior		Fiscal Council
Vice-President
		Marcelo Amaral Moraes
Eduardo Fernando Jardim Pinto		Chairman
Jorge Luiz Pacheco
José Mauro Mettrau Carneiro da Cunha		Aníbal Moreira dos Santos
José Ricardo Sasseron		Antônio José de Figueiredo Ferreira
Ken Abe		Nelson Machado
Luciano Galvão Coutinho
Oscar Augusto de Camargo Filho		Alternate
Renato da Cruz Gomes		Cícero da Silva
Sandro Kohler Marcondes		Marcus Pereira Aucélio
		Oswaldo Mário Pêgo de Amorim Azevedo
Alternate
		Executive Officers
Deli Soares Pereira
Hajime Tonoki		Roger Agnelli
João Moisés de Oliveira		Chief Executive Officer
Luiz Augusto Ckless Silva
Luiz Carlos de Freitas		Carla Grasso
Luiz Felix Freitas		Executive Officer for Human Resources and Corporate
Paulo Sergio Moreira da Fonseca		Services
Raimundo Nonato Alves Amorim
Rita de Cássia Paz Andrade Robles		Eduardo de Salles Bartolomeo
Wanderlei Viçoso Fagundes		Executive Officer for Integrated Bulk Operations

Advisory Committees of the Board of Directors		Eduardo Jorge Ledsham
		Executive Office for Exploration, Energy and Projects
Controlling Committee
Luiz Carlos de Freitas		Guilherme Perboyre Cavalcanti
Paulo Ricardo Ultra Soares		Chief Financial Officer and Investor Relations
Paulo Roberto Ferreira de Medeiros
		José Carlos Martins
Executive Development Committee		Executive Officer for Marketing, Sales and
João Moisés de Oliveira		Strategy
José Ricardo Sasseron
Oscar Augusto de Camargo Filho		Mário Alves Barbosa Neto
		Executive Officer for Fertilizers
Strategic Committee
Roger Agnelli		Tito Botelho Martins
Luciano Galvão Coutinho		Executive Officer for Base Metals Operations
Mário da Silveira Teixeira Júnior
Oscar Augusto de Camargo Filho		Marcus Vinícius Dias Severini
Sérgio Ricardo Silva Rosa		Chief Officer of Accounting and Control Department

Finance Committee		Vera Lúcia de Almeida Pereira Elias
Guilherme Perboyre Cavalcanti		Chief Accountant
Luiz Maurício Leuzinger		CRC-RJ — 043059/O-8
Ricardo Ferraz Torres
Wanderlei Viçoso Fagundes

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.


Date: October 27, 2010	Vale S.A. (Registrant)
	By:	/s/ Roberto Castello Branco
		Roberto Castello Branco
		Director of Investor Relations