News from Brazil

Business & Economy

In Brazil on September 10, 2010 at 11:14 am

ECONOMY

Brazil’s real crept higher as investors defied attempts by the country’s central bank to weaken the currency and protect local exporters. Euphoria over huge foreign investment in Latin America’s biggest economy has boosted the real, lifting it last week to its strongest level against the U.S. dollar this year (Reuters).

Caixa Economica Federal, Brazil’s largest home lender, raised its forecast for mortgage loans by 17 percent in 2011 because of higher-than-expected demand from Brazilians for new housing (Reuters).

Brazilian central bank policy makers said that risks to a benign inflation scenario in the country are falling because of higher borrowing costs and the reversal of economic stimulus measures that bolstered activity during a short-lived recession last year (Reuters).

Brazil’s production of new cars and trucks rose for a second straight month in August, while sales set a monthly record, as automakers sought to meet rising demand for new vehicles in domestic and international markets (Reuters).

Brazil’s government boosted the amount of investment loans made available through the state development bank by 90 billion reais ($52.2 billion), as it seeks to spur activity in the capital goods, exports and technological innovation sectors (Reuters).

Brazil’s economy is forecast to expand by 7.34 percent in 2010, up strongly from the 7.09 percent estimate the previous week, and compared with 7.12 percent about one month ago, according to the central bank survey (Reuters).

Brazil’s strong domestic demand has contributed greatly to the vigorous recovery of the country’s industry, the sector hit hardest by the 2008 global financial crisis (Xinhua).

The number of liquidated companies in Brazil was up 18.9 percent in August compared to July, credit consulting company Serasa Experian said (Xinhua).

Brazil ranks third in the list of priority global investment destinations for the next two years, after China and India, says the latest survey released Monday by the United Nations Conference on Trade and Development (UNCTAD) (Xinhua).

BANKING & FINANCE

BTG Pactual, the Brazilian securities firm controlled by billionaire Andre Esteves, is in talks to raise about $1.5 billion from sovereign wealth funds in Asia and the Middle East, Valor Economico newspaper reported (Reuters).

Mining company Vale has launched a two-tranche, $1.75 billion bond sale (Reuters).

Axxon Group Private Equity, a Brazilian buyout firm, plans to raise as much as 500 million reais ($290 million) to speed up purchases of local companies linked to consumer growth (Bloomberg).

Banco do Brasil SA is likely to lend $223 million to Israel’s Merhav to help finance an ethanol plant in Colombia (Bloomberg).

Banco do Brasil SA is also studying the purchase of a “small” bank in Peru and may complete a transaction within weeks to help promote trade between Brazil and the neighboring country (Bloomberg).

Brazil’s lack of long-term private financing stems from a shortage of instruments to help financial institutions raise capital, according the country’s national development bank (Bloomberg).

AGRI

Brazil’s grain production in 2010 will rise 10.5 percent compared to last year. the country’s Institute of Geography and Statistics (IBGE) announced (Xinhua).

OIL & GAS

The eyes of the global oil industry will be on Rio de Janeiro as it once again hosts the biennial expo Rio Oil & Gas, the biggest event of its kind in Latin America, which is set to be held between September 13-16, 2010 at the city’s principal convention center, Riocentro in Barra da Tijuca (The Rio Times).

Brazil will auction off  production rights to oil in the vast offshore Franco prospect that is not used in an oil-for-shares swap with state oil company Petrobras (Reuters).

Global oil company Royal Dutch Shell unveiled plans on Wednesday to sell its stake in four Brazilian offshore blocks, including a field in the vast deepwater subsalt region (Reuters).

PORTS

Shipments from Brazil’s largest port have been delayed by heavy rains and a rising number of vessels from the food industry. Ships will wait a record 29 days before loading this month at the Santos port in Sao Paulo state, Nicolle Alves de Castro, a commercial associate at research firm Santos Associados Consultoria Ltda, said (Bloomberg).

MINING & MINERALS

Brazil Potash Corp.  is pleased to announce the discovery of new potash mineralization on its Amazon Potash Project in Amazonas State. The project is located within the Amazon Basin adjacent to the Petrobras Fazendinha and Arari Potash deposits (Reuters).

Bahia Mineracao Ltda, the mining company controlled by Zamin Ferrous and Eurasian Natural Resources Corp., is seeking $1.4 billion of loans from Brazilian banks to finance an iron-ore project in the country’s northeast (Bloomberg).

RETAIL

Grupo Pao de Acucar, Brazil’s largest retail group, is in talks with several large local banks over a consumer finance venture to help fund the purchase of home appliances (Reuters).

Pao de Acucar said  its home appliances unit will likely have more than 20 billion reais ($11.6 billion) in sales next year (Reuters).

AVIATION

Aircraft maker Embraer won a $1 billion loan commitment from a group of 25 banks to finance exports and working capital needs, indicating that the company was gaining access to credit in a bullish corporate debt market (Reuters).

American Airlines announced it will begin three days a week service between Dallas/Fort Worth (DFW), and Rio de Janeiro, Brazil (GIG) starting Dec. 16 (Reuters).

Qantas Airways Ltd. is considering starting flights to either Sao Paulo or Rio de Janiero in Brazil (Bloomberg).

INFRA

CSN, Brazil’s largest diversified steel group, expects its $2.6 billion railway and logistics project Transnordestina to start operations by the end of 2012, in a move that could help the company transport more than 30 million tonnes of cargo a year across the nation’s fastest-growing region (Reuters).

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