Benedito Mendonça
Reporter - Agência Brasil

Brasília - The Brazilian steel industry intends to invest US$ 13 billion over the next five years to expand production. With these resources, steel production is expected to grow from 34 millions tons of installed capacity to 50 million tons. This affirmation was made by the new president of the Brazilian Steel Institute (IBS), Luís André Rico Vicente, who took office yesterday (1). According to Vicente, this expansion does not include the projects of the Vale do Rio Doce Company, which could raise the country's productive capacity to as much as 60 million tons.

According to Vicente, this expansion is more than enough to meet domestic steel demand and maintain exports. According to IBS data, 11.9 million tons of steel were exported last year, for record earnings of US$ 5.3 billion. Vicente says that a 2.9% drop in exports is forecast for this year, which means that sales in 2005 will total 11.6 million tons.

In Vicente's view, the sector's performance is due to the modernization of the industrial park, cost reductions, and improvements in product quality and management methods. "We are emerging from a post-privatization period, during which it took 10 years to restructure the sector."

Translation: David Silberstein