Federative Republic of Brazil / Loan Insurance for Iron Ore Plant Upgrading Project

Nippon Export and Investment Insurance (NEXI, Chairman and CEO: Atsuo Kuroda) has decided to underwrite loan insurance for a project that will upgrade iron ore plant facilities (the Project") to be undertaken by CSN Mineracao S.A. (CSN Mineracao), which is an iron ore production and sales company that is a subsidiary of a Brazilian steel producer Companhia Siderurgica Nacional S.A. (CSN). The insurance is provided for a USD 350 million loan co-financed by BNP Paribas, Tokyo Branch; Citibank, N.A., Tokyo Branch; Credit Agricole Corporate and Investment Bank, Tokyo Branch; and Societe Generale, Tokyo Branch.

Having minor stake in CSN Mineracao, ITOCHU Corporation has sent director to engage in management, while JFE Steel Corporation and Kobe Steel, Ltd. have had long-term offtake agreements to purchase iron ore produced by CSN Mineracao.

Given the pronounced oligopolistic structure of the seaborne iron-ore market by major mining companies, it is important for Japan that Japanese companies have the long-term right to purchase iron ore from independent companies in addition to such major mining companies in line with its strategy for securing resources. The Project is expected to support a stable supply of iron ore to Japanese steel market, since a portion of the loan will be used to develop beneficiation plants in order to meet the demand of the Japanese steel companies for maintaining the current quality of iron ore with high iron content and low impurities. Additionally, as CSN Mineracao will use the loan to replace the conventional tailings dam with a filter press (a facility to dewater tailings), the Project will contribute to their safer operations.

As a Japanese financial institution that implements national policy, NEXI will actively support projects that contribute to secure supply of resources and energy to Japan, as well as the overseas business development of Japanese companies.

Contact: Natural Resources Group II, Structured and Trade Finance Insurance Department
Tel: +81-(0)3-3512-7744