May 25 2004
Companhia Vale do Rio Doce, the world's largest iron ore producer and exporter, informs that it has signed an agreement for the production of coal in China with Shanghai Baosteel Group Corporation (Baosteel), the largest steelmaker in China, and Yongcheng Coal & Electricity Group (Yongcheng), one of the largest coal producers in China.
The agreement encompasses the constitution of a joint venture for anthracite and coal production in Henan province, China. Yongcheng already has three coal mines in operation with the capacity to produce eight million tons per year.
According to the agreement, CVRD4s take will be equal to its stake in this joint venture and will be strategically sold to its pelletizing plants and Brazilian steel producing clients. The agreement between CVRD, Baosteel and Yongcheng strengthens the Company's relationship with these important steel and coal producers and its presence in the Chinese economy, and highlights CVRD4s entrance into the coal business, complementing its portfolio of products for the steel industry, currently composed of iron ore, pellets, manganese ore and ferro-alloys.
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