BRAZIL

Long Steel Products and Specialty Steels

   In 2002, these operations totaled 3.6 million metric tons, 3.8% more than the 3.5 million metric tons from the previous year. Rolled steel production reached 3.3 million metric tons, with a growth of 1%.

   The performance of the long steel sector was noteworthy for the increased operating efficiency in its melt shops, especially as a result of a 17% reduction in lost time in the electric arc furnaces, and in the rolling mills, where the number of bars lost was reduced by 50%. An average increase of 10% was also realized in the use of production capacity at the rolling mills, nail factories, mesh-manufacturing units and rebar fabricating facilities. Working capital was reduced by 15% over the year.

   The specialty steels sector recorded increases of 10% in productivity and 7% in use of production capacity at Aços Finos Piratini, a mill focused largely on the automotive industry.


Açominas

   The specialty steels sector recorded increases of 10% in productivity and 7% in use of production capacity at Aços Finos Piratini, a mill focused largely on the automotive industry.

   The general performance of Açominas, however, remained at a level similar to that of 2001. Production stability was due to the mill’s return to normal operating levels in September, after the March accident that damaged the blast furnace cowper.

    Açominas is expected to produce 2.9 million metric tons of crude steel in 2003, a growth of 21% resulting from the return to normal production levels and the gains generated by the investments made in the mill’s expansion in the past years.