Nickel prices remain strong despite slow recovery and abundant supply from world leaders Russia and Canada. As a steel component, nickel is seen in Brazil as an answer to the country's long-term steel-making plans as well as its potential as a high-earning export.

Vale is the world's second biggest nickel producer, with operations in Canada, Indonesia and New Caledonia, as well as nickel refineries in Britain, China, Japan and Taiwan.

Brazil's targeted grand entry into the global nickel market is timed with Vale's plans to maintain its iron ore processing and export and diversify into other minerals and chemicals. The company announced its intentions to boost its role in nickel market as it opened its first nickel operation in Onca Puma, southeast of the northeastern Para state.

Company officials said they rate the Onca Puma plant as one of the largest ferronickel production plants in the world with annual nickel production set to exceed 53,000 tons. Once fully operational the plant will have an annual capacity to produce 220,000 tons of ferronickel.

Vale said it spent $2.84 billion on getting the site up to speed, with more than 9,500 employees -- 1,500 hired for the early phase.

Company executives hailed the plant as a major stride toward developing Brazil's overall capacity for nickel processing and exports.

"Onca Puma is a milestone, not only because it is Vale's first nickel production plant in Brazil, but also as it provides an example of the building of sustainable relations with communities in the municipalities in the area covered by the project," said Ricardo Carvalho, the company's director of South Atlantic base metal operations.

The first container shipment of 1,078 tons of ferronickel left Brazil May 11, company officials said. The shipment included 385 tons of nickel bound for importers in the United States, Europe and Asia.

It has taken Vale more than five years to reach the current stage in its operations since it took over the project in 2005. Mine development work during the intervening period has involved ore extraction operations in the Once and Puma mountains, close to the location of the processing plant.

Nickel is resistant to oxidation and corrosion and is used to make alloys with many different industrial applications. More than 60 percent of the metal in production and export is used in stainless steel production.

Brazil aims to build its nickel market around traditional U.S. customers, China, Japan and EU nations.

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