Chinese group Wuhan Iron & Steel has given up on its project to build a steel works in Brazil in partnership with Brazilian group EBX, owned by businessman Eike Batista, which had been expected to cost US$5 billion, Chinese newspaper 21st Century Business Herald reported Tuesday.
Citing unidentified sources the newspaper said that the decision had been made after a number of feasibility studies had shown that the risk was too high, specifically due to logistics problems such as supply and transport of coking coal to feed the furnaces.
The steel works, which was to have been built in the industrial area of the port of Açu, which is being built by the LLX Logística group, which is controlled by EBX, in Rio de Janeiro, will require construction of a 300-kilometre railroad to transport raw materials to the factory.
The agreement to build the steel works was signed in 2010 during a visit by Chinese President, Hu Jintao to Brazil. (macauhub)