POSCO prefers investment in India over Brazil

POSCO prefers investment in India over Brazil

South Korean steel giant POSCO recently announced that it prefers investment in steel expansion projects in India over Brazil. Although POSCO is still waiting for approval from the Orissa government to build its planned $10.4 billion, 10 million tons per year steel plant in Orissa in cooperation with Anglo-Australian mining giant BHP Billiton, a POSCO official announced that the company still prefers India as an investment destination over Brazil. According to POSCO officials, the company is applying for a long term lease with India's Ministry of Coals and Mines to ensure a steady supply of iron ore. The proposed 10 million tons per annum steel plant would require 70 million tons of iron ore. As SteelOrbis previously reported on October 1, POSCO mentioned cooperation with Brazilian mining giant Companhia Vale do Rio Doce (CVRD) in northern Brazil's Maranhao state as an alternative destination to India's Orissa state. The problem with the investment site of Orissa is that the port is only 4 meters deep and POSCO would like a port site with a depth of at least 22 meters in order to reduce freight costs. Further the company is reluctant to invest in deepening the port. However, POSCO officials stated that the company expects the Orissa government to develop road and rail lines and provide modern infrastructure in the region to attract this investment to India.