Nippon Steel to build mill in Brazil-Nikkei

TOKYO, March 25 (Reuters) - Japan's Nippon Steel Corp (5401.T: Quote, Profile, Research), the world's second-largest steel maker, plans to spend 500 billion to 600 billion yen ($5 billion to $6 billion) to build a steel factory in Brazil, the Nikkei business daily reported on Tuesday.

Nippon Steel has said it has been talking with its Brazilian affiliate Usiminas (USIM5.SA: Quote, Profile, Research) to build a new blast furnace in Brazil in 2010 to 2011 as it boosts output to narrow the gap with industry leader ArcelorMittal (MT.N: Quote, Profile, Research)

The Nikkei newspaper said Nippon Steel would build the mill through a joint venture with Usiminas, with Nippon Steel taking a controlling stake in the project.

The first blast furnace would be constructed for a little less than 300 billion yen with an annual ouptut of 3 million tonnes, the Nikkei said. A second furnace would be added as early as 2010, doubling output to 6 million tonnes, the newspaper said. (Reporting by Nathan Layne; Editing by Toni Reinhold)