Companhia Vale do Rio Doce (CVRD) has concluded iron ore price negotiations for 2005 with Nippon Steel Corp. (NSC), the largest Japanese steelmaker.

As a result of the negotiations, iron ore prices for Carajas (SFCJ) and Southern System (SSF) fines, FOB Ponta da Madeira and Tubarco, respectively, increased by 71.5% relative to 2004.

The magnitude of the price increase for 2005 reflects an unprecedented situation characterized by a relative lack of balance in the global metals and maritime freight markets, which led to substantial prices increases for these products and services during the last few years.

CVRD reinforces its long-term commitment with clients, investing a significant amount of resources, despite rising investment costs, in the production and logistics of iron ore. For 2005, CVRD capex budget allocated US$ 1.7 billion for investments in ferrous minerals. Currently, CVRD is developing six projects for iron ore production capacity expansion, which will come on stream between 2005 and 2007.

The iron ore price settlement with a large and traditional customer such as NSC, with whom CVRD has a fifty-year old commercial relationship, is an evidence of the weight of the long-term view involved in these negotiations.

Headquartered in Brazil, Companhia Vale do Rio Doce (CVRD) is the world's largest iron ore producer.