Vale Leads Gains for Metal Stocks as Rio Scraps China Deal

June 5 (Bloomberg) -- Vale SA led gains for Brazilian metal producers after rival Rio Tinto Group scrapped an investment from Aluminum Corp. of China, easing concern that China would import less from the world’s biggest iron ore miner. Vale rose 2.2 percent to 33.13 reais at 11:09 a.m. in Sao Paulo trading. The Rio de Janeiro-based company has gained 38 percent this year, compared with a 43 percent advance for the Bovespa index. “China is Vale’s biggest client and acquiring a natural resources company could have been a big danger for the company,” said Bernardo Lobao, a metal analyst at Rio de Janeiro-based BNY Mellon Arx, which manages $2.2 billion. “It distances the possibility that China would buy Rio Tinto.” Chinalco, as the state-owned company is known, offered $19.5 billion for a stake in Rio, the world’s third-largest mining company. Chinalco is China’s largest aluminum producer The collapse of the China accord is a setback for the nation’s plan to secure supplies of materials to drive economic growth. China’s steelmakers are insisting on a 40 percent price cut in iron ore prices with Vale, according to analysts, after Rio Tinto offered a 33 percent discount to Korean and Japanese steelmakers. Vale controls more than two-thirds of the world’s exported iron ore along with BHP Billiton Ltd. and Rio.