Brazil's Vale reports lower 1Q profit

Brazilian mining giant Vale reported a 10.1 percent drop in first-quarter net profit on Wednesday, citing lower sales, higher taxes and currency fluctuations.

A statement from the world's top iron ore producer said net profit totaled $3.199 billion during the period, down 10.1 percent from the same period last year.

But the first-quarter result was better than the fourth quarter of 2012, when net profit totaled $1.95 billion.

Market analysts had expected net profit of $2.7 billion in the first quarter of this year and Vale said it was pleased with its progress.

"Despite the slight fall in iron ore production, we had positive surprises in the production of basic metals" such as copper and nickel, said Luciano Siani, Vale's chief financial officer.

Last week, Vale reported a 3.5 percent slump in iron output due to operational problems and rainfall.

But it maintained a production target of 306 million tonnes for this year.