08/19/2008 07h55
FGF opens plant with an eye on steel industries
Valor Econômico 08/19/2008
Fundição Global Foundry - specialized in stainless steel - opens its third plant today, in Itaquaquecetuba, in the Metropolitan Region of São Paulo. With an area of seven thousand square meters, the new unit will double the productive capacity of FGF starting next year, besides allowing the company to manufacture large-sized centrifuged parts for steel industries. In total, FGF invested R$ 3.4 million (US$ 2.2 million) in the increase, and 41% of the amount was financed by the Brazilian Development Bank (BNDES). According to Carlos Priolli, minority stockholder and financial officer of the company, most of the production of stainless steel is sold to the steel and mining industries, which, on their turn, use the metal casting in their blast-furnaces. "We are focused on the large steel industries", said Priolli, while informing that the company intends to have greater participation in international public tenders with the new unit. In 2007, FGF exported nearly US$ 13 million and it expects to reach US$ 18 million this year. Another factor that should show positive effects in the 2008 result is the fall in the price of nickel. Until yesterday, the price of the commodity accumulated a fall of 46% in the London Metal Exchange (LME), compared to the closing of last year. Nickel closed yesterday's trading session at US$ 18,060 a ton, whereas it was worth US$ 26,500 in the end of 2007. "We had orders with nickel at a high price since last year. With the fall, the recovery of the operating margins in the year is a trend", affirmed the officer. Stainless steel is made mainly by nickel and scrap, varying according to the application. From the total capital of the company, 90% is controlled by the De Negri family and the other 10% is in the hands of Priolli. The stockholder does not rule out the foreign fund allocations or from investment funds in FGF. The interest, according to him, would be in the fact that the company participates in the same market of Japanese Kubota, one of the leaders of the sector of parts and stainless steel pipes.
