Vale wants to sell part of metals unit, Tesla cars abandon sensors and what matters in the market

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Vale wants to speed up metals operations

Vale is in negotiations to sell a minority stake in $2.5 billion (R$13 billion) in its metals operations, according to the Financial Times.

The area, which has lower revenue in relation to the company’s main business – the production of iron ore –, should play an essential role in the energy transition agenda.

The idea of ​​the sale is to unlock value from nickel and copper operations, metals used in electric car batteries and renewable energy sources.

The interested: evaluate the operation of Japanese trading companies, investment funds from the Middle East and car manufacturers, in a deal that can evaluate Vale’s metals operation in $25 billionaccording to the Financial Times.

• Automakers are particularly interested because of the low supply of nickel outside Asia. More than half of the mines for the metal used in electric car batteries are in China.

• In May, Vale announced that it had signed a long-term agreement with Tesla to supply low-carbon nickel from its Canadian operations.

OPEC+ puts gas on the fire

OPEC+ decided on Wednesday (5th) to cut the pace of oil production by two million barrels a day, in the most drastic reduction since the beginning of the 2020 pandemic.

What explains: the decision is in line with the view that an eventual recession caused by the global high interest rates should put a brake on demand for the commodity.

• With the restriction of supply, the idea is to keep the prices of the barrel at high levels, benefiting the cartel members (large oil producing countries led by Saudi Arabia, and its allies, the most notorious being Russia).

• The production cut could serve to ease the Kremlin’s cash, boosting the country’s revenue as it pours billions to fund its war in Ukraine.

• Officially, OPEC+ said it seeks to avoid price volatility.

in numbers: the barrel of Brent oil rose 1.99% late in the afternoon, quoted at US$ 93.63 (R$ 488.16). Since the beginning of the week, when the intention to cut was announced, it has already risen almost 6.5%.

It’s in Brazil? On the stock exchange, the news boosted oil companies’ shares and helped the Ibovespa close at a high of 0.83%, at 117,197 points. There were gains from Petrobras (3.76%), 3R Petroleum (3.49%) and Prio (ex-PetroRio) (3.20%).

The high places Petrobras against the wall in the election period. The state-owned company had been announcing a drop in fuel cuts in the wake of the drop in prices abroad, but the second round campaign starts with a lag between domestic prices and import parity.

Petrobras sources told Sheet that there is strong pressure from the government to at least not raise prices.

in numbers: at the opening of the market this Wednesday, the price of gasoline in Brazilian refineries was BRL 0.28 per liter below import parity, while diesel was discounted at BRL 0.17.

The data are from Abicom (importers association) and do not consider the advance of oil this Wednesday.

Tesla abandons sensors

Following an old desire of Elon Musk, Tesla will abandon the sensors of Model 3 and Model Y cars to rely only on cameras in its security and driver assistance systems.

What explains: the choice has as one of the reasons the scarcity of these components in the market. Without them, the cost of producing cars also drops.

• These sensors – in Tesla’s cars, there are 12 – are mainly used in beacon situations and in the detection of nearby objects, such as to keep a distance from the vehicle in front, for example.

• In a recent interview with an American website, Musk said that Tesla’s camera system has improved so much that it works better without the radars.

On the opposite way: Tesla’s decision goes in the opposite direction to that of other automakers, which are betting on the combination of sensors, lidars (laser sensors) and cameras.

• The assessment is that the cameras do not have the same efficiency when exposed to the reflection of the sun, in dark environments or in storms. In this case, the difficulties would be compensated by the other mechanisms.

Tesla also bets just the cameras for its Autopilot system, which brakes, accelerates and steers the car on its own. The automaker says he does not drive the vehicle alone, but some accidents with the system on have been recorded in recent years.

Impacts: The manufacturer said that the end of radars may temporarily limit features such as automated parking, but will not affect crash safety.

Wall benches with Musk offering

The new twist to Elon Musk’s Twitter takeover couldn’t have come at a worse time for the banks that finance part of the $44 billion deal.

Understand: it is common for banks to sell their loan portfolio to reduce the risk of operations. The problem is that the current moment, of high interest rates, low growth and great uncertainty, should alienate those interested.

• In recent deals in this format, institutions tried to go to the market to offer their loan portfolios and ended up failing.

in numbers: Of the $44 billion, major banks have committed to providing $12.5 billion. Creditors include institutions such as Morgan Stanley, Bank of America and Barclays.

• The rest would come from Musk’s pocket, and the progress of the deal began to worry Tesla shareholders. They believe the billionaire will need to sell more shares in the company to pay the bill.

• On Tuesday, the automaker’s shares fell 6% before ending in a 3% drop.

• Before agreeing to pay the original amount, Musk tried to negotiate a discount with Twitter to close the purchase of the network, but he couldn’t, according to the Wall Street Journal.

“Everything App”: hours after the disclosure that the billionaire had gone back and decided to buy Twitter, he said on the social network that the acquisition would be a way to accelerate the creation of X, than he called it “everything app”.

• Asked by a user if it wouldn’t be better to create an app from scratch, he said that buying Twitter would probably speed up the process by 3 to 5 years, but didn’t elaborate.