Companhia Siderurgica do Pecem (CSP), a steel company in which Dongkuk Steel is invested, broke ground to build a steel plant on July 17 at the Pecem Industrial Complex in Ceara State in northeast Brazil, Dongkuk Steel said recently. The dignitaries participating in the ceremony to kick off the construction included Gov. Cid Gomez of Ceara State; Director Jose Martins, who is in charge for Ferrous Minerals for Vale Co., the largest iron ore mining company in Brazil; Vice President Chang In-hwan of POSCO; Chairman Chang Sae-joo of Dongkuk Steel; and President Marcos Chiorboli of CSP, among others.

The new blast-furnace steel plant is slated for completion in 2013 and is expected to go online in the third quarter of 2015 with the capacity to turn out 3 million tons of steel annually.

Chairman Chang said, “My dream I had since I first visited Brazil to build a steel plant 10 years ago has now come true. CSP is the fruit of Dongkuk Steel’s ideas and passion for steelmaking and the plant under construction will be a top steel plant when it goes online in 2015.”

CSP is a joint venture steel company set up by partners Vale, Dongkuk Steel, and POSCO. The consortium will build the projected steel plant at a cost of $4.9 billion. Dongkuk Steel, which conceived the idea for the plant, holds a 30 percent stake in CSP, while POSCO owns 20 percent and Vale holds 50 percent. Dongkuk Steel secured a syndicated loan of 500 billion won from the Korea Development Bank to pay for its investment in CSP.

Dongkuk Steel worked on the ground and infrastructure where the projected steel plant is to be erected, including the exclusive wharf for steel products and a conveyor belt to transport iron ore from the wharf to the steel plant. The completion of the wharf facilities was celebrated recently with President Dilma Rousseff of Brazil, cabinet ministers, and other dignitaries in attendance including Chairman Chang. 

The multipurpose wharf for the projected steel plant is named after his late father Chang Sang-tae’s penname, Cais Song-Won. 

Brazilian President Rousseff promised at the ceremony the federal government’s support to the projected steel plant until it is completed, which is being built under the control of POSCO. POSCO will provide various technologies and construction know-how for the new steel plant.

Chairman Chang said in his speech that the company worked for the past 10 years to prepare for the construction of the projected steel plant in the Pecem Industrial Complex in Ceara State and since the project is being jointly undertaken by Vale, the world’s leading iron ores mining company, and POSCO, the fifth largest steelmaker in the world, it would undoubtedly be a great success when it is completed and begins turning out steel slabs. He continued, “Both Dongkuk and POSCO will work together to create a steel bridge that connects Korea and Brazil, falling back on their histories of creating a miracle in the development of the steel industry in Korea.”

Chairman Murillo Ferreira of Vale Co. said in his speech that his company will support the growth of the economy of Ceara State and the steel industry by supplying top quality iron ore to the new steel plant.

The projected steel plant is the dream of the late chairman Chang Sang-tae, the father of Chairman Chang, who took over the helm of the steelmaker in 1983 from his late father Chang Kyung-ho. He wanted to build a steel plant in Brazil while he was running Dongkuk Steel and his son the current chairman swore to realize his late father’s dream when he became the CEO in 2001. Since then, he has worked on the project and is about to realize the dream of his father, as the groundwork for the steel plant has been in progress since the end of 2010.