Metal trader in talks

PUBLISHED : Wednesday, 19 December, 2007, 12:00am
UPDATED : Wednesday, 19 December, 2007, 12:00am

China Minmetals Corp, the mainland's biggest base metals trader, is in talks to set up a steel-making joint venture with Brazil's Cosipar which may involve an investment of up to US$2 billion, joining rivals building plants in resource-rich countries.

The joint venture would build a steel plant with annual capacity of two million tonnes, a 600,000 tonne a year coking unit and related port facilities, Xinhua reported yesterday citing local newspaper reports.

Investment in the whole project is estimated at US$1.5 billion to US$2 billion. Minmetals's investment in the steel plant would be about 70 per cent, the report said.

A spokesman from Minmetals declined to comment. But BNamericas, a Chile-based news service, citing Luis Guilherme Monteiro, Cosipar's chief financial officer, said steel output at the planned joint venture was scheduled to start in 2011 or 2012 and the focus would be on exports.

The plant would be built on the site of Cosipar's Usipar pig iron unit in Barcarena city, which has a capacity of 500,000 tonnes a year.

BNamericas reported Mr Monteiro as saying executives from the mainland company visited the plant earlier this month.

Baosteel Group Corp, the largest steelmaker on the mainland, is also building a steel slab plant in Brazil with Brazilian miner Vale, formerly Companhia Vale do Rio Doce.

Minmetals, which is involved in trading, mining, property, shipping and engineering, is moving to invest overseas as the mainland struggles to meet demand for metal resources.