ArcelorMittal To Invest $5 bn New Steel Mill In Brazil

ArcelorMittal SA, the world's largest steelmaker is all set to build a new steel mill in Brazil. The company plans to invest $5 billion in the project, CEO Lakshmi Mittal said in his statement.

 

The plans to invest in a plant in the south-eastern state of Espirito Santo were announced in a meeting on Wednesday in London between Mittal and Brazilian President Luiz Inacio Lula da Silva.

 

Mittal said,"I gave the president details about what we intend to do in Brazil.”

 

The new project named ‘Companhia Siderurgica de Ubu ‘will be collaboration between the steel powerhouse and Brazilian mining giant Vale - the world's largest iron ore producer and exporter.

 

ArcelorMittal will replace China's BaoSteel as Vale's joint-venture partner after the Chinese firm pulled out of the project.

 

Mittal said that although there is currently a global surplus of steel-making capacity, his company is confident about the sector's future growth prospects and has therefore chosen to invest in a mill that will take time to come on stream.

 

"With Brazil's future growth, steel-production units can't be built from one day to the next. So we have to build thinking about that," the executive said in reference to the company's long-term plans.

 

Mittal also said the company has its sights set on projects in Brazil that had been suspended amid the recession and praised the Brazilian government for its economic management amid an adverse global financial climate.

 

CEO of the company said,"We have plans to expand in Brazil. We want to increase our presence in the country.”The company holdings in Brazil include steelmakers ArcelorMittal Tubar, ArcelorMittal Inox Brasil and four steel plants formerly owned by Belgo-Mineira, now part of the ArcelorMittal group.

 

The ArcelorMittal directors meeting last month chose Brazil as a priority country for investment in the wake of the sharp drop in steel production triggered by the global economic crisis. The company also has plans to upgrade three of its plants in the country to expand their capacity to produce steel used for civil construction and infrastructure projects. 

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