The first and my most favorite Brazilian company is the Companhia Vale Do Rio Doce (RIO) the large Brazilian Iron Ore Producer. Heads of this company believe the end of the downturn is in sight and the Brazilian iron ore producer plans to go on a spending spree in 2009 to align output and shipments with expected increased demand from China. On Thursday CEO, Roger Agnelli told reporters thats China;s economy has stopped weakening and the global economy will stop weakening in the 2nd quarter. He followed up by stating that Vale plans to boost investments by 40% to $14 billion in 2009 up from $10 billion in 2008. After Vale slashed iron ore production in fourth quarter as demand weakened they have done the opposite in 2009. On Thursday Vale signed a contract to build 15 new tugboats, 32 barges, and two other vessels at a cost of $171.1 million to carry its iron ore to China. With such large investments any investor should not try to avoid such a big gain in 2009 and 2010 from Vale. With the industry as whole expecting to expand with growth in infrastructure in China and U.S. RIO should have its hands full with constant business. Expect to see similar results as the company produced from 2004 to 2007' and then it will be too good to resist. Another group of stocks to go along with RIO are the shippers (TBSI, DRYS, GNK, NAT). With commodity prices increasing these companies to should have a constant flow of business and be able to rebound from the 94% dip the industry was hit with in 2008. With RIO trading at $14 right now it is so under valued it is ridiculous. This was a company trading in the $70 levels a couple years ago and i wouldn't be surpassed if it was back there in a couple more.
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