Cia. Vale do Rio Doce, the world's largest iron-ore producer, may expand shipments to the U.S. as part of a plan to help Esmark Inc. buy the Sparrows Point steel mill in Baltimore.
Vale, based in Rio de Janeiro, will continue to sell about 3 metric million tons of iron ore a year to Sparrows Point, said Jose Carlos Martins, Vale's ferrous metals chief. Vale also is considering building an iron-ore pellet plant or coking-coal import facility at the site, he said.
``For us it's very important to have this foot in the U.S. market,'' Martins told reporters today on a conference call. ``It's not in our interest to be operating steel mills. We want to guarantee our iron-ore sales.''
Vale said last week it will spend as much as $270 million to help Esmark, a Chicago-based steel distributor, finance the purchase of the mill from Arcelor Mittal, the world's largest steelmaker.
Esmark hasn't yet disclosed a price for the acquisition, Martins said. Most of the approximately 4 million tons of iron- ore Vale sells in the U.S. is bought by Sparrows Point.
Martin said Vale tried to convince Usinas Siderurgicas de Minas Gerais SA, the second-largest steelmaker in Brazil, to bid for Sparrows Point. Usiminas shareholders led by Nippon Usiminas, a group of Japanese investors that own the largest stake in the steelmaker, and a group of employee pension funds opposed the bid. Vale is a minority shareholder of Usiminas.
To contact the reporter on this story: Jeb Blount in Rio de Janeiro at firstname.lastname@example.org
To contact the editor responsible for this story: Steve Stroth at email@example.com