Timber company buys pig iron maker in Brazil

Cikel, a timber company with an area covering around 500,000 hectares of forests mainly in northern Brazil states, has recently acquired Terra Norte Metais, a pig iron maker located in Marabá city in Pará state.

In an interview with Steel Business Briefing, Manoel Pereira Dias, a Cikel director, said both blast furnaces at Terra Norte are being relined at the moment. One will come back on stream in the beginning of September, and the other in the first days of October.

Cikel is currently working on a five-year plan for the plant, which is expected to be concluded by the end of this year. The executive did not discount a possible future move into steelmaking.

The company supplies trees for several pig iron makers from the Carajás region, but Dias told SBB that this acquisition of Terra Norte will not affect these sales. Besides timber, Cikel also has businesses in logistics, packaging and agribusiness, among others, notes SBB.

Terra Norte has capacity to produce around 12,000 tonnes of pig iron per month, or some 144,000 t/year.

Soon both parties – Cikel and Terra Norte – will disclose the value of the transaction, said Dias.

Publication: SBB - Steel Business Briefing
Provider: Steel Business Briefing
Date: August 29, 2008