Brazil-based iron and steel maker Gerdau said Tuesday its proposed logistics and mining investments will enable the company to more than double iron ore production within the next six years, to 24 million mt/yr, from the current 11.5 million mt/yr.
In a presentation to investors, Gerdau revealed plans for a $163 million railway terminal to support capacity expansion to 18 million mt/yr in 2016.
Logistics plans the company hopes to implement in order to reach the 2016 predicted capacity include a $120 million investment in upgrading roads from mines to the company's iron ore treatment unit at Miguel Burnier.
Also planned is a $133 million, five-mile, 10 million mt/yr capacity conveyor belt connecting Gerdau's iron ore treatment unit to its Ouro Branco mill.
With an eye on the 24 million mt/yr capacity plan, Gerdau also is looking at building a port terminal with an iron ore export capacity of 25 million mt/yr, with the ability to import 5 million mt/yr of coal.
"Logistics [are assured] for sales of ore to third parties until 2015," the company said, with 4.5 million mt/yr shipped to its own Ouro Branco mill.
Earlier this year, Gerdau disclosed its 2014 cap-ex would total Real 2.9 billion ($1.2 billion), with the first spending priority development of the iron ore mining business and optimization of its first-ever flats operation in Ouro Branco.
The mill currently has an installed capacity of 800,000 mt/yr of hot-rolled coil with the potential for an additional 1.1 million mt/yr of heavy plate production by 2016.
Both the mining and flats units are located in the southeastern state of Minas Gerais.
In 2013, Gerdau's investments totaled Real 2.6 billion, of which 59% was spent in Brazil.
