June 10, 2009

The last few years have seen significant change in our company and our industry. The changing demands of the business, the move by major industry players to consolidate and leverage economies of scale, and the current global economic crisis have introduced a new reality to the mining sector that requires us to seek new and innovative ways to remain competitive.

What has become abundantly clear is that an economic turnaround alone, should it occur, will not deliver the gains required to position us competitively in all price cycles and realize long-term growth. For that to happen we need to manage and structure the business differently going forward.

To date, we have introduced a number of measures to secure both the immediate and long-term health of our nickel operations around the globe. Similar measures have been introduced concurrently across all other lines of business at Vale worldwide. Our efforts are working, but more remains to be done. Over the next three months, additional restructuring will occur in our global nickel business along with further alignment and simplification of management systems and processes globally. Managerial positions and functions will bear the initial impact of this effort, and there will be fewer people going forward in these roles than there are today.

Complementing that effort, each of our nickel operations around the globe – including the corporate office in Toronto and Vale Inco Technical Services Limited in Mississauga – has been assigned specific performance improvement targets designed to position them as cash-flow positive. These improvements will come primarily through decreased operating and capital costs. It is critical that each business unit become self-sustaining such that they are able to fund their operations, capital investments and future growth on an ongoing basis.

At Vale Inco, we are creating a sustainable and prosperous future for the business that will meet the needs of the current generation of employees and the generations to come. Getting there won’t be easy – it will require significant change – but breaking with the past is sometimes the only way to a more prosperous future.

We will keep you informed of our progress as we continue towards our shared vision of creating the world’s largest and leading mining company.

Thank you,

Tito Martins,

President and CEO

Vale Inco Limited