Reuters quoted Mr Dan DiMicco CEO of Nucor as saying that it has contracts with Vale SA, Samarco and Iron Ore Co of Canada to supply ore to the first of four iron production units to be built near New Orleans.

Mr DiMicco said that the St James Parish, Louisiana direct reduction iron or DRI unit also has a 20 year, natural gas supply contract. He declined to name the supplier.

He said that the ore for the Louisiana unit will come from Vale and Samarco mines in Brazil and IOC mines in Newfoundland and Labrador in Canada. Samarco is a joint mining and pellet venture between Vale and BHP Billiton. IOC's main shareholders are Rio Tinto and Mitsubishi.

These are the same sources for iron ore used at Nucor's 2 million tonne a year DRI mill in Trinidad and Tobago.

Mr DiMicco also said Nucor is considering Brazil for future expansion. He added that "We are more than comfortable to be a strong minority shareholder, something like 49 percent would be our objective. We have to have a strong partner with operating experience."

DRI is used to make sponge iron, a raw material mixed with scrap metal in electric blast furnaces to make steel. Sponge iron requires less energy to make than pig iron, the main new iron source for electric mills, and has more iron content. This allows steelmakers to use lower quality scrap when making steel.

Nucor said in March 2011 that the St James Parish facility is expected to group the DRI units in two plants with the capacity to produce 5.5 million tonnes of sponge iron a year and require an investment of USD 3 billion.

(Sourced from www.reuters.com)