Dow Jones reported that Brazilian iron ore mining company Vale SA is studying setting up a plant to produce railroad rails in Brazil's Minas Gerais state.

As per report, the plant, to be located in the town of Governador Valadares, would have a production capacity for 500,000 tonnes a year of rails, to be used for Vale's own railroads and the market in general.

Vale is one of Brazil's biggest railroad owners and operators. Brazil currently imports rails from suppliers in countries including China, as Brazil's sole producer, steelmaker Companhia Siderurgica Nacional SA or CSN stopped producing rails in 1996 due to lack of demand at the time.

Steelmaker Gerdau SA is also studying the possibility of producing rails at its Ouro Branco steel mill in Minas Gerais.

(Sourced from www.dowjones.com)