MercoPress. South Atlantic News Agency

Brazil’s Vale to invest 2.9bn USD in the country’s largest port by volume

Vale Brasil, the world’s largest ore carrier leaves Ponta de Madeira with 391.000 tons of iron ore for China

Brazil’s Vale Doce, the world’s biggest iron-ore producer, said it will invest 2.9 billion US dollars to increase the capacity of the Ponta da Madeira terminal in northern Brazil, making it the largest port in the country by volume.

Vale, which last year shipped 294.4 million metric tons of iron ore and pellets, will increase the terminal’s capacity to 150 million tons next year, the Rio de Janeiro-based company said Wednesday in a statement. The expansion will allow the terminal in the state of Maranho to receive and load two ships at once, the company said.

“The port will be an alternative to the three major ports of the South and Southeast regions” of the country, Vale said in the statement. “Besides handling more iron ore, Ponta da Madeira will become an important transport hub for soy and corn”.

Simultaneous to the announcement the company loaded its Vale Brasil vessel, the world’s largest ore carrier, for the first time early Wednesday at the same terminal. The ship, which transports 391,000 tons of iron ore, will sail for the Chinese port of Dalian, it said.

Vale Brasil is the latest milestone in Vale’s long history of investment in infrastructure, a key element for the competitiveness of Brazilian iron ore on the international market. “We don’t stop investing and innovating. Vale’s investments in infrastructure are the biggest ever made in the country, resulting in efficient logistics for our customers. We invested 9 billion USD over the last six years and, in 2011 alone, a further 5 billion will be invested in the integrated mine-railroad-port-shipping chain,” explained Integrated Operations executive director, Eduardo Bartolomeo.

Vale Brasil was ordered by Vale from Daewoo Shipbuilding & Marine Engineering Co in South Korea. It is the biggest ore carrier in the world, with a 400,000-ton capacity, 362-meter length and 65-meter width. Vale Brasil is the first of seven ore carriers ordered by Vale from the South Korean shipyard, totalling an investment of 748 million USD.

Vale has also ordered 12 ships each with a capacity of 400,000 tons from the Rongsheng Shipbuilding and Heavy Industries shipyard in China. These vessels, being built at the Chinese shipyard, involve a total investment of 1.6 billion USD.

Besides owning 19 400,000-ton ships, Vale will have an additional 16 ships with the same dimensions, which will operate exclusively for the company under long-term contracts signed with ship owner partners. These 35 ships are due to be delivered between 2011 and 2013.

“With our fleet of our own and chartered ships, we will be able to reduce volatility in the freight market. Volatility does not only affect the freight cost, but also the price of ore itself. As the new ships come into operation, the freight and ore costs will become more stable, benefiting Vale and its steelmaking customers,” said Marketing, Sales and Strategy executive director, José Carlos Martins.

Over the last two years, Vale has ordered the construction of 51 vessels, including tug boats, barge trains and catamarans, from domestic shipyards, helping to develop the Brazilian shipbuilding industry, generating 2,465 direct and indirect jobs, and involving investment of 300 million USD.

In all, 15 tugboats have been ordered in Brazil – 11 built at the Detroit shipyard in Itajaí (Santa Catarina) and four at the Santa Cruz shipyard in Aracaju (Sergipe).