Eduardo Bartolomeo: Okay. We got it. We got this one.
Timna Tanners: Other one was just on premium outlook. Thanks.
Eduardo Bartolomeo: I’ll answer the first one then, Timna, you answer the second one.
Gustavo Pimenta: Hey, Timna. Gustavo here. On the cost outlook, we came at a C1 at $23.5. It’s slightly lower than last year. It’s you have to be mindful that Q1, it’s usually our toughest quarter in terms given the lower volumes that are produced. So, the effect of dilution is limited, as we saw last year. But, when we look at the forecast for the year, we are feeling super confident with the numbers that we laid out the $21.5 to $23. A lot of the cost efficiency initiatives that we’ve started 18 months ago are bearing fruit, and sales are coming in strong. Production is coming in strong. So, we are we are feeling good about it. The challenges which have been managed, on the all in, I think Leonardo made that reference in terms of the breakeven cost, has been mostly associated with the freight rates, which Vale is mostly hedged, which is one of our competitive advantages.
Not a 100% hedged, so you saw an uptick this quarter. But, this is one of the, headwinds that we’ve been able to manage. We are now probably 90% hedged in terms of our demands for the year, also hedged on the Brent costs. And, the other element here are the premiums, which came a little tighter and as given, market conditions. But all-in-all, we are feeling very good with the numbers that we have laid out in terms of course, our forecast for the year for both C1 and all-in cost across all businesses by the way.
Operator: Next question from Ricardo Monegaglia with Safra.
Ricardo Monegaglia: Hello. Good morning, everyone. I have a couple of questions, actually, follow-ups from previous questions. First, on the base metals business, there are any changes to commodity price hedge policies given the recent rally in metals prices? And, the second question still on base metals is, there any updates that you could share with us on regards to the conclusion of Vale base metals transaction? It continues to be expected to occur in the second quarter. What are the final steps to conclude this acquisition would be interesting to understand? And, my second question is on iron ore quality. Based on the target for the year and 1Q ‘24 levels, it implies that quality will come above the level of 62.5% in the coming quarters. Should we expect this trend already in the second quarter or high silica sales could continue high or at the same levels as in the 1Q? Those are my questions. Thank you, guys.
Eduardo Bartolomeo: Gustavo.
Gustavo Pimenta: Sure. Thanks, Ricardo. So I’ll do the first ones, and then, Spinelli will cover the premiums. So, on the hedging, we usually don’t do it. That’s the nature of the business. We like to run the exposure unless there is some very unique conditions where we may we may want to consider. So, that’s part of the nature of our business, and we like to run with exposure in those commodities. On the VBM, we’ve got I think Eduardo mentioned in his prep remarks, we’ve got all the regulatory approvals, and we are now working with partners to move to the closing, which we expected to happen the next, call it, couple of weeks. So, keep the market updated about it. So, I’ll turn back to Spinelli.
Marcello Spinelli: Okay. Thank you, Ricardo. So, regarding the quality of average, depends on the first firstly in the production mix and, you saw that we had a good performance in the north system and as we have a pattern of higher production in the second half that will naturally increase the average grade. And, in regarding sales, you’re right. We had a took an advantage to sell directly the high silica in the first part of the year actually in the end of last year. So, the discount was there. So, we can take this, a choice every actually, every day we assess this. So, as we move forward during the year, we have the possibility to blend this product or to concentrate this product or sell them directly. But, in the second half, we don’t have a lot of high silica as we increase the production in north system, and we prioritize the blend.
And after that, we can choose the remaining high silica if you want to sell directly on all. It’s difficult to precise in advance, depends on the market conditions.
Operator: Next question from Gabriel Simoes with Goldman Sachs.
Gabriel Simoes: Hi. Can you hear me?
Eduardo Bartolomeo: Yes.
Gabriel Simoes: Okay. Thanks for taking my questions. I actually have one quick follow-up, on one of the questions that were asked before. Actually, I just wanted to understand on the development of your iron ore projects. So, if you could comment a bit, on how the development is going the capacity increases increasing projects. So, Vargem Grande and Capanema and Plus 20 that’d be great, because we just wanted to understand how the projects are doing so far and how confident you are with the timeline you provided earlier. I know you mentioned that Sossego should remain the same timeline. Just wanted to have a better sense on the other ones? Thank you.
Gustavo Pimenta: So, Gabriel Gustavo here. Yes, we’re feeling pretty good about it. We gave you some stats during Eduardo’s presentation of where each one of those projects are. We have a series of projects, but the three main ones we’ve been pointing out is, Vargem Grande and Capanema and Plus 20. And they are moving along, the timeline we had established. So, we’re feeling pretty good about it. And Vargem Grande, for example, the expectation is that to start, have to start-up, by the end of the year. So, that’s one of the key projects that we’ve promised to deliver through 2026 to have that increase and take value to a potential range of 340 to 360. So, I’m moving, along the plan, and we are feeling pretty good about those deliverables.
