Reuters reported that Brazil’s largest maker of long steel products Gerdau will invest BRL 2.5 billion on expanding a wire rod and rolling mill in Rio de Janeiro state, which will see some of the country’s most ambitious infrastructure projects in coming years. The project will more than double capacity at Gerdau’s Cosigua mill in Santa Cruz, an industrial compound in Rio state.

Cosigua, a 40 year old plant, produces rods, bars and other steel products for the construction industry. The investment will take place in two phases, with the first happening through 2013 and involving the upgrade of the rolling and wire rod output capabilities. Another similar mill will be built in a second phase between 2014 and 2016.

The move highlights Gerdau’s efforts to tap into Brazil’s biggest ever boom in civil construction, as housing and heavy construction works rise at a record pace. The government is seeking to ease Brazil’s infrastructure woes as it prepares to host the 2014 soccer World Cup around the country and the 2016 Olympics in Rio de Janeiro.

Mr Jorge Gerdau Johannpeter chairman of Gerdau said that “We are expanding in Rio to meet a surge in demand for steel in Brazil, fueled by growth and the sports events.”

The Cosigua upgrade program encompasses a 50% increase in crude steel capacity that is expected to reach 1.8 million tonnes, along with the assembling of the wire rod and rebar rolling processors. Currently, Cosigua has an installed capacity of 1.4 million tonnes a year.