Brazil's CVRD to export copper, alumina to China, paper says

Asian Economic News, April 21, 2003

RIO DE JANEIRO, April 15 Kyodo

Companhia Vale do Rio Doce (CVRD) is drafting with Beijing its first-ever contracts to export copper and alumina from Brazil to China, the business daily Gazeta Mercantil said Tuesday.

The company is the world's largest iron ore exporter and expects to close negotiations with the Chinese side in May. It would export to China part of the production of the Sossego copper mine located in the state of Para in the Amazon rain forest region, the daily said.

The copper mine is scheduled to go into operation by March 2004 and has an annual output capacity of 140,000 tons, according to the daily.

CVRD is also planning to export to China part of the alumina produced from the bauxite extracted from another mine in Para, the daily said. It has invested some $583 million to expand the alumina production of Alumina do Norte do Brasil (Alunorte), according to the daily.

It is reportedly speeding up negotiations so as to benefit from a sharp rise of the alumina price in the spot market, from $160 a ton to $280, according to the daily.

The increasing demand for alumina in the Chinese market, as a consequence of an expansion in the civil construction and infrastructure areas, is the key factor for the higher price of the commodity, according to the daily.

Brazilian exports to China have soared by 132% from $1,085 million in 2000 to $2,520 million in 2002, according to the federal Foreign Trade Agency.

The three main products Brazil exports to China are iron ore, timber and iron and steel goods, according to official statistics.