Sao Paulo, Brazil, 24 Nov – Brazilian mining company Vale do Rio Doce, which ahs China as its largest overseas customer, aims to increase its overall exports iron ore by 10% in 2006, the company’s directors said Thursday.
The company, which is the largest private enterprise in Latin America, projects that it will export 225 million tons of iron ore and pellets, with a particular emphasis on China. The company’s directors believe that demand from the international market for its main products will keep increasing at its current rate.
Vale’s financial director, Fábio Barbosa, said that the company should sell a total of 250 million tons of ore to Brazil and overseas, an increase of 9.2% against 2004. Sales of iron and pellets are expected to total 270 million tons next year.
The company will spend USD 3.3 million by the end of 2005 to increase its production, Barbosa said. Investment in 2006 will total USD 5 million on new projects in Brazil and abroad.
Vale do Rio Doce is the second largest exporting company in Brazil, after airplane manufacturer Embraer, with exports of USD 5.5 million in 2004.
Barbosa added that Vale do Rio Doce remains interested in building a steel works in a partnership with Chinese group Baosteel, in the northeast of Brazil, in a total investment of USD 2.4 million.
The project, initially to be built in Maranhão state, has not yet begun due to the Brazilian government failing to grant environmental licenses.
Fábio Barbosa also added that investments in Brazil were being reassessed due to the increased value of the Brazilian currency against the dollar.
Soy and iron ore accounted for 59% of Brazil’s exports to China in 2004, and a total USD 9.1 billion.
China is Brazil’s third largest trading partner, after the United States and Argentina.
The Brazilian government has forecast that China will become its second largest trading partner by the end of 2005, with trade of USD 12 billion.
The chairman of Vale do Rio Doce, Roger Agnelli, currently heads up the Brazil-China Chamber of Economic Development (CBCDE), which was created in June 2001 to encourage trade and investment between the two countries. (macauhub)