11/02/09

The Brazilian mining sector is holding its breath in hopes that China will continue boosting its iron ore demand as a result of a recently launched stimulus package by the nation`s government, according to Antonio Lannes, economic data manager for Brazilian mining institute Ibram. “For Brazil, one of the most important package plans announced recently is China`s,” Lannes told BNamericas. “China is a strong player in the iron ore market and has great influence on Brazilian iron ore exports and market prices.”
According to Lannes, Brazil`s iron ore stocks started dropping and prices began to rise when China recently announced a US$700bn rescue package for its economy.
“We noticed some improvement in January compared to December,” he said.
Brazil`s iron ore shipments rose 27% to 15.5Mt in January versus December, according to Ibram, but are still considerably below the 24.5Mt in January 2008.
Meanwhile, iron ore prices in January rebounded to US$99/t from US$70/t in November, although they are still less than half the US$200/t registered in August, according to Ibram.
Ibram now anticipates investments of some US$57bn through 2017, instead of through 2012 as originally planned.
“What we have noticed is that 8% of the US$57bn has been temporarily suspended,” Lannes said. “But projects that have already started will be completed.”
Claudio MendonçaBusiness News Americas

BN Americas