VALE is on the edge of shipping its first nickel out of its long-delayed Goro mine in New Caledonia. Initial plans are to sell 4,000 tons of nickel concentrate, but by 2013 the facility could be producing 58,000 tons of pure finished metal every year.
Nickel is an unusually difficult metal to work with, forcing producers to process ore at very high temperatures, high pressure, extremely caustic chemicals or a combination of the three.
At the moment, Russian nickel giant Norilsk (NILSY.PK) is unlikely to feel the sting of added competition for some time. Norilsk currently produces 280,000 tons of nickel a year.
Separately, several analysts are coming out bullish on VALE shares. Several think the stock could rise from around $32.50 today to well into the $40 range, with at least one targeting $44 -- a full 35% up from here -- within the next year.
The yuan is a factor here. If China's currency appreciates, then the yuan in which VALE's top customers pay will also become more valuable, giving VALE a short-term boost thanks to favorable exchange rates.