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Loans for Equity Participation in Niobium Production Company in Brazil
Supporting Japanese Companies in the Securing of a Long-Term Stable Supply of Mineral Resources

  • Region: Latin America and the Caribbean
  • Energy and Natural Resources
  • Overseas Investment Loans
NR/2012-77
October 24, 2012
  1. The Japan Bank for International Cooperation (JBIC; Govenor: Hiroshi Okuda) signed loan agreements*1, each amounting up to 135 million U.S. dollars (JBIC portion) with Nippon Steel & Sumitomo Metal Corporation (NSSMC) and JFE Holdings, Inc. (JFEHD), to acquire equity shares of Companhia Brasileira de Metalurgia de Mineração (CBMM). The loans are cofinanced with private financial institutions.
     
  2. The loans are intended to finance NSSMC and JFEHD for a consortium formed by NSSMC; JFE Steel Corporation, a subsidiary of JFEHD; Sojitz Corporation; and Japan Oil, Gas and Metals National Corporation; to acquire 10% of the equity shares of CBMM. CBMM is a mining producer that owns the world’s largest market share of niobium, a rare metal, with a niobium mine, refining plant and metallurgical production facilities in the Araxa area of Minas Gerais State, the Federal Republic of Brazil.
     
  3. Niobium is indispensable in the production of high-grade and special steel products.  It is distinguished by its ability to dramatically enhance the strength, durability, and heat resistance of steel products with the addition of only trace amounts. High-grade and special steel products containing niobium are used for a wide range of steel products such as pipelines, automotive steel, large-scale construction steel and power generation turbines, and Japan depends entirely on imports from overseas.
     
  4. Worldwide demand for niobium is growing with the economic development of emerging countries, thus it is extremely important for Japanese steel makers to secure a stable and continuous supply of niobium, and to maintain and improve the international competitiveness of Japan’s steel industry. Upon the acquisition of the equity shares, NSSMC and JFE Steel entered into an offtake agreement on long-term basis with CBMM to further secure the stable procurement of niobium.   
     
  5. JBIC will actively support the further development and acquisition of mineral resources, including rare metals, and energy resources by Japanese companies.
Note
  1. *1 Although JBIC signed a loan agreement with JFEHD on October 10, this Press Release was issued in timing with the signing of a loan agreement with NSSMC today.

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