Report from the Commission - Monitoring of Article 95 ECSC Steel Aid Cases, Fourteenth Report, October 2000
Date: 2000-10-31
Institutions: European Commission
Subjects: ECSC aid, activity report, competition law, control of State aid, iron and steel industry

COMMISSION OF THE EUROPEAN COMMUNITIES

Brussels, 31.10.2000
COM(2000) 685 final

REPORT FROM THE COMMISSION

Monitoring of Article 95 ECSC Steel Aid Cases, Fourteenth Report, October 2000

REPORT FROM THE COMMISSION

Monitoring of Article 95 ECSC Steel Aid Cases, Fourteenth Report, October 2000

Table of contents

Summary ………………………….…………………………………….. 3

Overview ………………………………………….……………………... 5

Irish Steel, Ireland …………………………………………………….… 6

Siderurgia Nacional, Portugal ……….…………………………………. 8

Eko Stahl, Germany ……………….…………………………………… 13

Voest Alpine Erzberg, Austria ………………………………………… 15

2

Summary

The Commission presents its Fourteenth Report on the Monitoring of Article 95 ECSC steel and
iron ore aid cases pursuant to its decisions of 4 April 19941, 21 December 19942 and 29
November 19953.

In accordance with the above mentioned decisions,
this fourteenth report will cover the
following companies: Irish Steel, Siderurgia Nacional, EKO-Stahl and Voest Alpine Erzberg.
Since most conditions imposed by the Commission in its decisions approving the aid are already
fulfilled, only the conditions still monitored by the Commission are addressed in this report.

1.

Irish Steel, Ireland

Investments carried out at Irish Ispat up to 30 June 2000 are in line with the planned
ones.Reported production and sales for the financial year 1999/2000 (from July 1999 to
June 2000) are in line with the imposed limitations.

2.

Siderurgia National, Portugal

The monitoring is focused on following up the plan for installation of the electric arc
furnace, which according to a modified plan should be operational in the second semester
of 2001. The closing down of SN Serviços is scheduled for the first trimester of 2001.
Legal steps for the required reduction of workforce at SN Serviços have not been taken
yet. In order to monitor the completion of the aided restructuring the Commission intends
to continue the monitoring until 15 March 2002.

3.

Eko-Stahl, Germany

The only conditions still monitored by the Commission is respecting the annual capacity
limitation (900 kt/y until the end of January 2000 and 1,5 million t/y as from February
2000) of the new hot-rolling mill and the using of its production only for further
processing in the company. The capacity limitation is controlled by an electric device, the
orderly functioning of which is monitored by the Commission. The capacity limitation
was respected during the monitored period.

4.

Voest-Alpine Erzberg, Austria

The price charged for iron ore was in line with market prices and higher than the price of
imported iron ore in the monitored period.

The decision authorises ATS 52 m. aid to be granted over 2000. In the first semester of
2000 ATS 20 m has been disbursed.

1

2

3

Decisions No 94/257-261/ECSC (O.J. L 112, 3.5.1994, p. 52, 58, 64, 71, 77)
Decision No 94/1075/ECSC (O.J. L 386, 31.12.1994, p. 18)
Decision No 96/269/ECSC (O.J. L 94, 16.4.1996, p. 17)

3

5.

Outstanding issues from previously monitored companies.

ILP

Investments performed in the first semester of 2000 did not modify the total production
capacity of the company.

In the dispute between Riva and IRI on the price paid for ILP, the competent ICC
arbitration court at Paris decided that Riva will have to pay an additional amount of 188,5
billion ITL to IRI. This needs to be added to the amount already paid, mentioned in the
tenth report (table, page 25).

ACERALIA

In the first semester of 1999 the total production capacity of the company has not been
modified.

AHV-Ensidesa Capital

Social aid paid to the company in the first semester of 2000was in line with the approved
aid.

Acenor

Social aid paid to the company in the first semester of 2000 was in line with the approved
aid.

Freital

No increase of remaining capacity took place in the first semester of 2000.

4

Siderurgia Nacional, EKO Stahl, Irish Steel, Voest Alpine Erzberg

Overview

Compan
y

SN

EKO

IRISH
STEEL

VAEG

Aid Article 95 ECSC

aid Steel Aid Code

Capacity reduction

Redundancies

Required

Achieved

Remarks

Authorized

Granted

Authorized

Granted

kt/y

Date

Kt/y

Date

Plan

Achieved

100 %

60.12
bn Esc =
306 M

€

5.925
bn
(29,55 M

Esc
€
)

2.438.79
bn
(12,01 M

Esc
€
)

140

31.12.95

100%

31.12.95

1798

=

1732
96%

Redundancies behind plan, new
electric furnace now planned to
be fully operational 3rd trimester
2001.

100%

900.62
mio DM =
461 M

€

385
DM

38.298
M.IR£ (47.7
)
M

€

38.298
M.IR£ (47.7
M

€
)

mio
408
ÖS=
€
29.7 M

239,8mio
ÖS (17,42
M

€

-

mio

100%

361

31.1.95

100%

28.2.95

by

650
1999

195
1999

by

by

205
1996

209
1996

by

-

-

-

-

-

by

61

71
2002

Redundancies
schedule.

ahead

of

5

I.

Introduction

Irish Steel, Ireland

The Commission decided on 7 February 1996 (Commission Decision 96/315/ECSC)4 to
approve aid under Article 95 ECSC linked to the sale of Irish Steel Ltd (ISL) to Ispat
International amounting to a maximum of IRL£ 38.298 million5, serving various purposes
toward the restructuring of Irish Steel (for details see the previous monitoring reports).

Under the terms of the decision the aid was approved subject to various conditions (for
details see previous monitoring reports).

At present, the only remaining conditions to be monitored are the respect of the production
and sales limitations until 30 June 2000 and the five years production capacity freeze up to
the end of May 2001.

The ninth monitoring report on Irish Steel Ltd (currently Irish Ispat Ltd.) covers the period
up to 30 June 2000, based on information submitted by the Irish authorities on 14
September 2000 in accordance with the Commission's decision.

II.

Production

Actual production of finished products in the first semester of 2000 was 188,291 tonnes.
Total production over the period July 1999 - June 2000 was 333.350 tonnes6. The
production limitation of 361.000 tonnes imposed by the decision for the period July 1999 -
June 2000 has been respected. The following table summarises the situation:

(thousands tonnes)

Finished Products Production

Year

Jul. to Dec.

Jan. to Jun.

Total

97/98

98/99

99/00

145

149

145

185

165

188

330

314

333

Limitation
/year

350

356

361

Sizes of beams produced were within the current range of sizes as communicated to the
Commission in November 1995.

Total billet production for the first semester of 2000 was 197,959 tonnes. Production of
billets for sale outside the company for the monitored period was 777 tonnes (the limitation
laid down by the Commission decision for the year 99/00 is of 90,000 tonnes).

4

5

6

€

OJ L 121 of 21/5/1996, p. 6
1
Production in the second semester of 1999 was 145,059 tonnes, see 13th Report

= IRL 0,7876.

6

III.

Sales

Sales of finished products in the monitored period totalled 194,206 tonnes compared with
165,772 tonnes of total sales in corresponding previous period.

The breakdown of sales by market for the first semester of 2000 shows that approximately
91% of sales or 176,480 tonnes went to European markets as defined under the decision
(i.e. Community, including domestic market in Ireland, plus Switzerland and Norway). In
the second semester of 1999 these sales totalled 131,135 tonnes and the total of these sales
for the period July 1999/June 2000 is 307,615 tonnes. The limitation imposed by the
Commission decision for European sales in this period(320,000 tonnes) has been respected.

The Irish authorities have also provided information on prices. The Commission has
examined this information and concluded that the prices are within the normal range.

Production for sale to Community markets of ISL's largest U beams (Imperial), HE beams
(metric) and IPE beams during the first semester of 2000 was 20,025 tonnes. Total
production for sale of these products into the European Community, plus Switzerland and
Norway, in the period July 1999 - June 2000 was 34.757 tonnes, slightly under the annual
limitation of 35,000 tonnes as laid down in the Commission decision.

7

Siderurgia Nacional, Portugal

I.

Introduction

On 12 April 1994 the Commission approved7 PTE 60.12 billion8 aid to the Portuguese
public steel undertaking Siderurgia Nacional under Article 95 of the ECSC Treaty (see
details in the previous monitoring reports).

This aid was paid in 1994 and 1995.

In September 1994 the Commission approved under the Fifth Steel Aid Code:9

PTE 4.925 billion in social aid,

PTE 1.000 billion in aid for environmental protection.

By the end of 1999, social aid amounting to PTE 2.409,56 billion has been paid. The
remaining social aid and the environmental aid may still be disbursed.

Authorisation of the aid was subject to several conditions. The following conditions are
still monitored by the Commission :

replacement of the blast furnace at Seixal by an electric arc furnace (outstanding),

total workforce to be reduced by 1 798 employees by the end of 1996 (delayed),

The present report covers developments up to 30 June 2000 on the basis of information
provided by the Portuguese Government in its thirteenth monitoring report, which was
submitted, in line with the Commission’s request, on 15 September 2000. The present
report concentrates on the conditions still monitored by the Commission.

II.

Investments

SN Longos – Electric arc furnace

Under the initial restructuring plan (PERG), the blast furnace was to be replaced by an
electric arc furnace by the beginning of 1996. The Portuguese Government’s decision to
privatise the operating companies immediately, which was not envisaged by the initial
restructuring plan, and the approach taken by the authorities of leaving the final
investment decision to the new private shareholders in SN Longos have led to a three-year
delay in installation of the electric arc furnace.

The investor, MEGASA, submitted a plan for installation of the furnace that was
discussed in the 12th Report, p. 8. As explained in the 13th Report, p. 8/9, a supplementary
delay occurred due to the decision to construct the furnace on another site, using existing
facilities. The revised table is as follows:

7

8

9

€

OJ L 112, 3.5.1994, p. 52.
1
OJ C 390, 31.12.1994, p. 18.

= 200,482 PTE. Total amount 299 million

€

.

8

Definition of the project and lay-out of the furnace

completed.

Analysis and attribution of the offers

Engineering details

Civil construction works

Installing the equipment

Start of operations

Furnace fully operational

completed

completed

2nd semester 2000; partially in
process

1st semester 2001

2nd semester 2001

1st trimester 2002

The Commission is following the progress of the plan step by step. It needs to be stressed
that when the derogation was granted under Article 95 of the ECSC Treaty, replacement
of the blast furnace by an electric arc furnace was regarded as a key feature of the
necessary industrial restructuring of Siderurgia Nacional.

The restructuring cannot therefore be regarded as complete until that investment has been
carried out. Although there is currently no indication that the delay will make it necessary
to grant further aid to SN Serviços, the Commission has to monitor the completion of the
aided restructuring.

On 15 October 1998 the Commission therefore already decided to extend the monitoring
period till at least 15 September 200010. In view of the above events the Commission
already set out in the the 12th and 13th Reports that the monitoring period should be
continued until 15 March 2002 to cover the whole period of the plan on the installation of
the electric arc furnace. The investment in the electric arc furnace is planned to be
completed by the end of the first semester of 2001. Considering the need for a sufficient
safety margin as delays may occur in such types of investment, the Commission intends
to continue the monitoring period till 15 March 2002.

III.

Evolution of workforce

Reduction of the workforce is still lagging behind the initial plan. This delay affects only
therefore have no impact on the viability of the privatised
SN Serviços and will
companies. A number of 447 workers still kept on by SN Serviços are necessary to
operate the blast furnace, which was initially scheduled to cease production by the end of
1996. Portugal and SN Serviços informed the Commission that for technical reasons11 SN
Serviços decided to cease its activities in the first trimester of 2001, thus before the new
electric arc furnace to be installed by SN Longos at Seixal enters into operation. The
company intends to proceed to the layoff of staff in this period. To date, the company did
not yet proceed to legal steps and negotiations with workers' representatives necessary to
reduce workforce.The delay in implementing the initial plan concerned altogether 178

10

11

SG(98)D/9106, sent on 29.10.1998
According to the Portuguese authorities and the company the construction of the electric arc furnace will
physically hinder the billet production process; the continuous casting installations used by SN Serviços
need to be dismantled and transferred to the site of the electric arc furnace;
the installations of SN Serviços
have reached the end of their technical life.

9

workers as at the end of 1999. The following tables show the evolution of the workforce
and the forecasts:

1997 till 1999 and forecasts for 2000 and 2001

1997

1998

1999

2000*

2001*

SN Longos + Lusosider

925

SN Serviços

Total workforce

Reduction per year

1078

2003

233

Planned total workforce

1410

Deviation without delay
in replacing blast furnace

Deviation from plan

146

593

784

985

1769

234

1410

-

710

878

1588

181

1410

-

359

178

708

796

1504

84

659

63**

722

782

1410

1410

-

94

-688

*Expected reductions during years 2000 and -2001

**Workers needed for dismantling the installations.

SN Longos is likely to increase its workforce once the new electric arc furnace is put into
service, so that the total workforce of the privatised companies will increase slightly after
the closure of the blast furnace. The initial target of 1 410 employees set by the
restructuring plan is expected to be achieved at latest during 2001 after closure of the
blast furnace.

10

Financing of redundancies:

Nature

Number of
workers

Art 56
ECSC

State (Art 56
ECSC)

Company1

Total

Costs in PTE million

1993 -

Early retirement

1998 * Redundancy2

Other

Total3

799

639

100

230.4

230.4

36.3

497.1

305.3

305.3

2778.3

3388.9

-

-

-

-

1538

535.7

535.7

2814.6

3886

1999

Early retirement

175

35.02

35.02

-

70.04

Redundancy2

Other

Total3

13

6

1.4

1.4

1.4

1.4

105.94

108.75

105.94

108.75

194

36.42

36.42

105.94

178.79

Early retirement

68

15.31

15.31

30.62

2000
(first se-
mester)

Redundancy2

Other

Total3

9

2

79

1.8

1.8

59.58

63.18

17.11

17.11

59.58

93.8

* For details on the period 1993 - 1998 see previous Reports.

1

In accordance with Article 4(1) of the Fifth (until 1996 included) respectively the Sixth Steel Aid
Code (as from 1997), a contribution from the State defrays 50% of these costs.

2 Through mutual agreement (negotiated redundancy).

3 These figures do not correspond to the net reduction in the workforce given in the previous table

because the companies have hired some new employees.

In 1999 PTE 29.79 million in social aid authorised under Article 4 of the Sixth Steel Aid
Code was disbursed.

IV.

Sales

The sales of billets on the Portuguese market by SN Serviços go exclusively to
SN Longos. Prices for these products are fixed on normal market conditions for a period
of three months. Residual steel production is sold on the market against market prices
(Metal Bulletin spot prices). The average prices achieved by the different product groups

11

were given in the monitoring report. The Commission has compared these prices with
the average market prices and considers them to be within the normal range.

V.

Financial performance

SN Serviços

The Portuguese authorities provided a full set of financial data and financial ratios in line
with the Annex to the Commission’s Decision. As set out in the 13th Report, SN Serviços
made losses in 1998 and 1999 due to a general collapse of steel prices. However,
financial results improved in the second semester of 1999 due to a improvement of steel
prices as from the second half of 1999. Despite improved steel prices in the first semester
of 2000 the company could not return to profitability in this period due to technical
reasons: SN's obsolete installations have been out of order for at least 20 days during the
monitored period.

(PTE million)

Sales and services performed

Other income

1998

21 741

89

19 438

-949

1999

First semester 2000*

Cost of sales

Personnel costs

Depreciation + provisions

Net financial charges

Other costs

Operating result

Gross profit

* provisional figures

13 977

13 053

4 143

1 381

226

3 534

- 1 430

- 581

4081

954

211

3171

-2 981

-2 611

9 886

- 504

6 595

2 016

557

169

1 517

- 1 372

- 1 294

VI.

Aid

The aid authorised under Article 95 of the ECSC Treaty has been paid in six instalments
between March 1994 and June 1995 as explained in the fourth monitoring report. The
environmental aid approved under Article 3 of the Fifth Steel Aid Code has not so far
been paid. The use of the social aid approved under Article 4(1) of the Fifth, respectively
the Sixth Steel Aid Code is explained above under II.3 (financing of redundancies).

12

EKO Stahl GmbH, Germany

I.

Introduction

On 21 December 1994 the Commission authorised12 DEM 900.62 million 13 aid to
EKO Stahl GmbH under Article 95 of the ECSC Treaty (see details in the previous
monitoring reports).

On 21 December 1994 the Commission further approved14 regional investment aid of
DEM 385 million15 under Article 5 of the Fifth Steel Aid Code.

Authorisation of the aid was subject to several conditions. The following conditions
are still monitored by the Commission:

–

–

the new hot-rolling mill to reach a capacity of 900 kt/y by the end of 1997 and to
be kept at that level until the end of January 2000. As from February 2000, the
company is allowed to increase the capacity of this mill to 1,5 mio tonnes/year
until the end of January 2005 (monitored, see II),

the output of the new hot-rolling mill to be used only for further processing in
the company’s own cold-rolling facilities (so far observed).

The present report covers developments up to 30 June 2000 on the basis of the
in its report submitted to the
information provided by the German Government
Commission on 14 March 2000. The present report concentrates on the two conditions
still monitored by the Commission.

II.

Capacity limitation

Limitation of the capacity of the new hot-rolling mill to 900 kt/y up until the end of
January 2000 and thereafter to 1.5 million t/y up until the end of January 2005 is
guaranteed by an electronic device that makes it technically impossible to exceed
those ceilings. This technical solution was accepted in principle by the Commission in
early 1996. For further details on the system, see the fifth monitoring report. The
system has operated reliably and the records of the quantities produced have been
regularly submitted to the Commission.

The authorised capacity increase as from February 2000 posed technical problems to
the company as the electronic device is adjusted for the capacity year, which runs
from July to June. On 15 March 1999 the Commission therefore agreed to a proposal
from the German authorities that the production from July 1999 until July 2000 would
be counted using the average production of the two thresholds which results in a
yearly capacity of 1,150 million t for the capacity year July 1999 - June 200016. The
machine has been adapted accordingly on 1 July 1999 and has been adjusted to 1,5
million t/y by 1 July 2000.

12

13

14

15

16

= 1,95 DEM. Total amount 462 million

€

OJ L 386, 31.12.1994, p. 18.
1
OJ C 18, 17.1.1997, p. 7
€
197 million
details see 13th Report.

€

13

III.

Production of the new hot-rolling mill

Hot-rolled strip produced in the new hot-rolling mill is used exclusively in the
cold-rolling mill.

The production of hot rolled strip amounted to 1,149,981 tonnes in the period 1 July
1999 - 30 June 2000 which implies that, over the capacity year 1999-2000 the capacity
limitation has been complied with.

14

Voest Alpine Erzberg GmbH, Austria

I.

Introduction

On 29 November 1995 the Commission approved17 state aid to Voest Alpine Erzberg
GmbH (VAEG) to enable it to close down its mining operations gradually up to the
year 2002. Approved aid amounts to ATS 272 million to cover operating losses over
the period 1995-2002 and ATS 136 million18 to cover the costs of closing down mines
safely and in an environmentally friendly manner.

The following annual ceilings were approved for the different
indicated below in the table under point 4.

types of aid are

Authorisation of the aid was subject inter alia to the following conditions:

–

–

–

the annual aid ceilings and the production ceiling as given in the table above
were not to be exceeded (so far observed; see under II.2.a),

the amount of operating aid was not to exceed the difference between production
costs and revenues (so far observed),

the price charged for iron ore was to be in line with market prices and was not to
be lower than the price of imported iron ore (so far observed).

This report covers developments up to 30 June 2000 on the basis of information
provided by Austria in its eighth monitoring report, which was submitted, in line with
the Commission’s request, on 14 September 2000.

II.

New monitoring report

1.

The company

The company Voest Alpine Erzberg Gesellschaft mbH (VAEG) is held by ÖIA
to Österreichische
Bergbauholding Aktiengesellschaft, which in turn belongs
lndustrieholding Aktiengesellschaft, an industrial holding company wholly owned by
the Austrian State. VAEG is involved in the mining of low-density iron ore (~32 %
Fe). The company has only one client, Voest Alpine Stahl AG (VASA), which was
privatised in the autumn of 1995.

2.

Operating aid

(a) Production and sales

In the first semester of 2000 VAEG produced 0,471 million tonnes of iron ore
with an average content of 33.6% Fe and 0,383 million tonnes of low grade
products which VASA can
burden
use
(Möllerzusatzmaterial). These quantities were sold and delivered to VASA.

blast-furnace

the

for

17

18

€

OJ L 94, 16.4.1996, p. 17
1

= ATS 13,703. ATS 272 million = 19,76 million

€

; ATS 136 million = 9,88 million

€

15

As in 1999, the ceiling for 2000 is 1 million tonnes of iron ore (cf. Article 1 of
the Decision). In 1999 VAEG produced and sold 1,149,000 tonnes of iron ore.
This was however due to unforeseen natural circumstances beyond control of
VAEG and the Austrian authorities19. On 13 June 2000 the Commission agreed
with the proposal of the Austrian authorities that the surplus of 149,000 tonnes
would be deducted from the authorised production in 2000, which will therefore
be only 851,000 tonnes.

(b) Production costs

The production costs for the standard-grade iron totalled ATS 74,088 million,
i.e. ATS 157,44 per tonne in the first semester of 2000. The production costs for
the low grade products totalled ATS 29,114 million in the period under review,
i.e. ATS 76 per tonne. The total amount of ATS 114,592 million includes
closure and rehabilitation operations carried out in the first semester of 2000. A
detailed overview of production costs is given in the Annex.

(c)

Pricing

The standard-grade iron ore was sold at ATS 139.50 per tonne. This standard
price has been set in November 1999 for the whole of 2000.

The low-grade material (Möllerzusatzmaterial) was sold at ATS 76 (
tonne, fixed on the basis of the market price for lime gravel (Kalkschotter).

5.52) per

€

The average price for deliveries of
iron ore and low-grade material
(Möllerzusatzmaterial) results in ATS 105,20 per tonne. Including the costs of
€
)per tonne
transport to VASA/Linz, the price charged was ATS 684.14 (49.72
Fe.

The information submitted by Austria in its tenth report confirm the information
given by Voest Alpine Rohstoffbeschaffungs GmbH, a subsidiary of Voest-
Alpine Stahl AG responsible for the purchase of raw material, that the above
price per tonne Fe for iron ore is higher than the comparable price it has to pay
for imported iron ore.

It may therefore be concluded that the prices charged in the first semester of
2000were not lower than required under Article 2 of the Commission’s Decision
of 29 November 1995.

(d) Operating aid

The total losses incurred by VAEG in the first half of 2000 were ATS -
24,779 million (

-1,746 million).

€

Of the total losses sustained in this period, ATS 11,390 million related to closure
operations. Further details on losses are given in the Annex.

19

Details see 13th monitoring Report, p. 17

16

In the first semester of 2000 a total amount of 20 million ATS for operating and
closure aid has been disbursed (9 million operating and 11 million closure aid).
The amount authorised for 2000 by the Commission is ATS 52 million (ATS 30
million operating aid and ATS 22 closure aid). Due to improvement of the
operating result the company expects that in 2000 only part of the authorised
operating aid will have to be disbursed..

3.

Closure aid

The authorised maximum amount of closure aid for 2000 is ATS 22 million. In the
first semester of 2000 ATS 11 million was paid, whereas the closure costs were ATS
11,390 million.

4.

Aid payments in relation to aid authorised

Total aid

Operating aid

Closure aid

(ATS million) Authorised

Paid

Authorised

Paid

Authorised

Paid

47

48

48

49

47.8

20

1995

1996

1997

1998

1999

2000

2001

2002

50

50

50

47

57

52

52

50

45

42

39

36

34

30

26

20

42

40

39

36

30

9

5

8

9

13

17.8

11

5

8

11

11

23

22

26

30

Total

408

259.8

272

196

136

63.8

5.

Evolution of workforce

The plan for reducing the workforce is as follows:

Workforce

1995

1996

1997

1998

1999

2000

2001

2002

Production

280

Closure operations

6

Total

286

276

10

286

273

13

286

273

13

286

254

20

274

242

20

262

210

31

241

181

34

215

Departing from the above plan, the workforce in production was reduced to 219 in
1999. Reduction of workforce is therefore ahead of plan.

17

Annex
Comparison of production costs and revenues, first semester 2000

Iron ore

Low-grade product

Closure and
securing

Total

Production
(tonnes)

470 550 t

383 080 t

Costs

(ATS million)

(ATS/tonne)

(ATS million)

(ATS/tonne)

(ATS million) (ATS million)

(ATS/tonne)

23.61

40,40

50,70

5,91

6,84

15,40

6,972

7,681

5,413

1,222

1,927

5,899

18.20

20.05

14.13

3.19

5.03

15,40

18,08

26,693

29,271

4,004

5,147

21,18

31,27

34,29

4,69

6,03

13,146

15,40

6,861

8,04

11,390

11,390

Production

11,108

Extraction

19,012

Processing

23,858

Quality control

2,782

3,220

7,247

6,861

Transport

Overheads

Cost related to
exhausted
parts of mine

Closure (tech-
nical and so-
cial measures)

Total cost of
sales

74,088

157,44

29,114

76.00

11,390

114,592

134.28

Revenues:

Iron ore

Low grade product

Sales (tonnes)

470.550 t

383.080 t

Selling price

65.642

139.50/t

29.114

76.00/t

Deduction for
difference
in
quality

- 4.943

Total

853.360 t

94.756

- 4.943

Total

60,699

29.114

89.813

105,20/t

Difference

Operating
result

Aid

-13.389

9,000

-11.390

-24,779

11.000

20.000

18