Rails Transport Brazil into the Future

The success of 15 years of concessions proves the importance of rail freight for the economic development of the country

Railway production increased 111.7%, more than

twice the growth of Brazil’s GDP

3,053

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

412 386538 617

766 668

1,089

1,958

3,114

2,221

2,597

4,173

2,499

4,596

2,941

162 113 4556

5856

35

8

44

72

140

225

123

112

574 499583 673

824724

1,124

1,966

3,158

2,293

2,737

4,398

1434,739

1,748

5,300

2,622

Investments in Existing Networks Granted to Private Initiative(Million Brazilian reais)

Notes: 1) The year of 1997 contains all of the investments of the year 1996, 2) Other values are currentSources: Ministry of Transportation, DNIT and ANTF Associates

Government Investments Concessionaire Investments First Two Quarters 2012 Projection

Investments Production

The train concessionaires have already invested 30.3 billion Brazilian reaisin the modernization of Brazilian cargo railways

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Railway Production (Billion TKU)

Notes: 1) TKU - Useful Ton Transported per Kilometer, 2) CAGR - Compound Annual Growth Rate Sources: ANTF and ANTF Associates

General Freight Iron Ore and Coal

278.5290.5

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

110.2 109.8 106.7

118.2 121.7 125.3 136.1

155.1165.1

183.6

207.5 206.7

185.2

213.5

227.1

27.0 31.7 32.2

35.740.2 42.5 44.4

47.4

56.148.6

49.963.9

58.3

64.9 63.4

137.2 141.5 138.9153.9

161.8 167.7 181.5

202.5

221.2232.3

257.4270.7

243.4

111.7%

CAGR1997-2011

5.5 %

First Two Quarters 2012 Projection

141.6

320.0

B razil’s economic growth depends on integrated transport logistics, ensuring the vitality of the internal market and the competitiveness of Brazilian products in overseas markets. Given

the geographic and economic characteristics of the country, the railways are essential in this challenge due to their proven efficiency in transporting large cargo volumes through long distances.

The sector’s denationalization process, begun in 1996, strongly revitalized rail freight in the country which had been almost scrapped. In 16 years of concession, the private sector has invested nearly 30.3 billion Brazilian reais in the recovery of the railway network, adoption of new technologies, personnel training, operations safety, and the acquisition and refurbishment of locomotives and wagons.

Brazilian railway production increased 111.7% over the past 15 years, an increase twice as large as that of the GDP during the same period (54%). In general cargo, production measured in TKU (Useful Ton Transported per Kilometer) grew 140.5%, while the transport of iron ore and coal rose by 104.9%.

The evolution of railway production was reflected by a greater variety of traditional and nontraditional cargoes. Agribusiness, for example, increased its participation in rail transportation by 277.2%. Additionally, the number of containers moved by trains grew more than 82 times in the 1997-2011 period.

More Production and More Diversity

EnvironmentSafety

The environmental advantages of rail

transportation are even greater

with the reduction of

fuel consumption

The accident rate was reduced by 81.6% in the past fifteen years

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The Number of Jobs Increases

The use of new technologies and innovative materials decreased fuel consumption on railways by 21.9%, from 1999 to 2011. This result further reinforces the benefits of railways, considered to be safer, more cost-efficient and less polluting than other modes of transportation. Some locomotives, actually, already use biodiesel as fuel.

Railways are Environmentally Friendly

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

Sources: ANTF and ANTF Associates

75.5 69.3 64.9

53.1

39.4 35.5 33.6 30.4 32.9

14.7 14.4 14.6 15.6 14.2 13.9

-81.6%

16.01

Accident Rate(Accidents per million train-kilometers)

First Two Quarters Sources: ANTF and ANTF Associates

Energy E�ciency Rating(Liters of diesel per thousand TKU)

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

4.24 4.29

5.31

4.41 4.27

5.12 5.08 5.04 4.90 4.79 4.62 4.554.15

4.10

-21.9%

Projection

The fleet of locomotives and wagonsgrows and renews itself each year, stimulating the entire railway equipment industry

There was a significant reduction in the accident rate, which fell 81.6% between 1997 and 2012, from 75.5 to 13.9 accidents per million train-kilometers. This positive result was a direct reflection of the massive investments made by the train concessionaires in safety campaigns, technology, personnel training, and maintenance systems. The values obtained in recent years come closer to the international parameter of 8 to 13 accidents per million train-kilometers.

Employment has more than doubled in the past fifteen years

Direct and Indirect Jobs in the Existing Network

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

16,66214,375

20,352 20,482 20,190 20,215 21,085

27,65930,227 30,508

33,254

37,720 36,78838,595

41,455

180.9% 46,797

44,000

Sources: ANTF and ANTF Associates First Two Quarters 2012 Projection

= 1,000 locomotives

= 10,000 wagons19971,154

43,816

3,045

100,9242011

5,000

140,000

2020(Estimated

approx.)

Sources: ANTT and ANTF Associates

In 1997 there were 1,154 locomotives and 43,816 wagons in operation. These figures rose to 3,045 locomotives and 100,924 wagons in 2011. That is, the fleet of locomotives and wagons in activity in the network, granted by concession, increased 131.2% and will increase even more: by 2020, the railway freight concessionaires intend to put more than 2,000 locomotives and 40,000 wagons on the tracks.

A Larger and More Modern FleetThe provision of direct and indirect jobs from freight railway increased 180.9%. In 2012, the industry employed 46,797 workers, more than twice the total of 16,662 jobs recorded in 1997. This is without mentioning the growing demand for labor in the national rail equipment industry.

TLSA - Transnordestina Logística

EFVM - Estrada de Ferro Vitória a Minas (Vale)

EFC - Estrada de Ferro Carajás (Vale)

FCA - Ferrovia Centro - Atlântica

ALL - América Latina Logística Malha Norte

ALL - América Latina Logística Malha Oeste

ALL - América Latina Logística Malha Sul

FTC - Ferrovia Tereza Cristina

FNS - Ferrovia Norte-Sul

Tramo Norte da Ferrovia Norte-Sul (Vale)

ALL - América Latina Logística Malha Paulista

MRS Logística

EXISTING RAILWAYS

RAILWAYS UNDER CONSTRUCTION

RAILWAY PROJECTS

RAILWAY STUDIES

EFA - Estrada de Ferro do Amapá

EFT - Estrada de Ferro Trombetas

Ferroeste - Estrada de Ferro Paraná Oeste

EF Jari - Estrada de Ferro Jari

FNT - Ferrovia Nova Transnordestina

FIOL - Ferrovia de Integração Oeste-Leste

FICO - Ferrovia de Integração Centro-Oeste

Ferroanel - Ferroanel Metropolitano de São Paulo

CONCESSIONAIRES MEMBERS OF ANTF

CONCESSIONAIRES N0N-MEMBERS OF ANTF

PAC’S MAIN PROJECTS

Port of Itaqui

Port of Pecém

Port of Suape

Port of Salvador

Port of Vitória

Port of Rio de JaneiroPort of Itaguaí

Portof Santos

Port of Paranaguá

Port of Rio Grande

Port of Manaus

Port of Santarém

Port of Porto Velho

Port of Marabá

Lucas R. Verde

Uruaçu Port of Ilhéus

Belo Horizonte

Maracaju

Panorama

Estrela D’Oeste

Açailândia

Port of Vila do Conde

Mafra

Corinto

12

8

4

5

7

9

10

11

62 3

1

Ferroanel SP – North Stretch

Ferroanel SP – South Stretch

Access to the Port of Santos

Lucas do Rio Verde - Uruaçu

Uruaçu – Corinto - Campos

Rio de Janeiro - Campos - Vitória

Stretches Being Studied / Reviewed

PAC in Execution

Current Network

Belo Horizonte – Salvador

Salvador - Recife

Estrela d’Oeste – Panorama - Maracaju

Maracaju – Mafra

São Paulo – Mafra - Rio Grande

Açailândia – Vila do Conde

1

2

3

4

5

6

7

8

9

10

11

12

Source: Ministry of Transportation

Federal Government Program of Investments in Logistics

r

Sant

os

Rio Grande da Serra

EstudantesSuzano

Mooca

BrásLuz

Perus

Jundiaí

Eng. Manoel Feio

Rod. Pres Dutra

North Ferroanel (project)

CPTM line shared with MRS

Rodoanel

MRS network

Existing stations

Rodoanel (project)

Parque Estadualda Cantareira

Ferroanel

Ferroanel (SP)

Source: MRS

Ferrovia Nova TransnordestinaObjective: To connect the ports of Suape (PE) and Pecém (CE) to the North-South Railway

Total length: 1,728 kmStart of construction: 2006Expected completion: 2014

Source: 4th Balance of PAC 2

Ferrovia de Integração Centro-Oeste (FICO)Objective: To connect the Central North region to the main ports of the country through the North-South Railway

Total length: 1,638 kmStart of construction: 2013Expected completion: 2017

Source: Valec

Objective: To connect Bahia to the main centers of the country through the North-South Railway

Total length: 1,022 kmStart of construction: 2012Expected completion: 2015

Source: 4th Balance of PAC 2

Ferrovia de Integração Oeste-Leste (FIOL)

Objective: To be the backbone of the Brazilian railway system, connecting all of the country

Total length: 2,255 kmStart of construction: 1996Expected completion: 2014

Source: 4th Balance of PAC 2

Ferrovia Norte-Sul (FNS)

RR AP

PAAM

RO

MT

AC

MA

PI

CE

RN

PB

PE

AL

SE

TO

DF

GO

MG

RJ

SP

PR

SC

RS

MS ES

BA

Porto de Porto Alegre

Porto de Laguna

Porto de Imbituba

Porto de ItajaíPorto dos Navegantes

Porto de Parananguá

Porto Itapoá

Porto de São Francisco do Sul

Porto de Santos

Porto de Angra dos Reis

Porto de Guaíba

Porto de Itaguaí

Porto do Rio de Janeiro

Porto de Vitória

Porto de Ubu

Porto de Salvador

Porto de Aratu

Porto de Aracaju

Porto de Maceió

Porto de Suape

Porto de Cabedelo

Porto de Natal

Porto de Mucuripe

Porto de Pecém

Porto de Itaqui

Porto do Rio Grande

Porto deSantarém

Porto de Trombetas

Porto deMunguba

Porto de Santana

MACEIÓ

RECIFE

MANAUS

BOA VISTA

CURITIBA

FLORIANÓPOLIS

PORTO ALEGRE

CAMPO GRANDE

CUIABÁ

SÃO LUIS

TERESINA

FORTALEZA

NATAL

JOÃO PESSOA

ARACAJU

SALVADOR

MACAPÁ

BELÉM

RIO DE JANEIRO

VITÓRIA

BELO HORIZONTE

SÃO PAULO

BRASÍLIA

GOIÂNIA

RIO BRANCO

PORTO VELHO

Rio Grande

Bagé

Lago

a dos

pat

os

Santana doLivramento

Uruguaiana

Santa Rosa

Santo Ângelo

SantiagoSão Borja

Passo Fundo

GaribaldiCriciúma

Forquilhinha

Siderópolis

Urussanga

Esplanada

Lages

Tubarão

Imbituba

Mafra

AraquariHerval D’Oeste

Foz do Iguaçu

Cianorte

MaringáLondrina

Harmonia

PontaGrossa

Eng. Bley

Rio Branco do Sul

CajatiApiái

Ourinhos

Rancharia

BauruTupã Itirapina

RubiãoJunior

Iperó

PortoFerreira

Varginha

Brisamar

Visconde de Itaboraí

Macaé

Bom Jardim de Minas

Barra do Piraí

DivinópolisBarreiro

Garças de Minas

Passos

Juiz deForaPoços de

Caldas

JeceabaM. Bu nier

Recreio

Três Rios

Cachoeiro de Itaperirim

Viana Andaime

Fábrica

Ouro Branco

Sarzedo

GovernadorValadares

Ibiá

Patrocínio

Colômbia

Uberaba

Uberlândia

Araguari

Pirapora

Montes ClarosPires do Rio

PontaPorã

Porto Murtinho

Maracaju

Indu Brasil

PresidenteEpitácio

Panorama

Três Lagoas

Água Clara

Inocência

Chapadão do Sul

Baús

Estrelad’Oeste

Alto Taquari

Alto Araguaia

Uruaçú

Figueirópolis

PALMAS

São Francisco

Senhor do BonfimCampo

Formoso

Juazeiro

Porto Realdo Colégio

União dos Palmares

Propiá

Salgueiro

Trindade

CratoSousa

Missão Velha

Eliseu Martins

Patos do Piauí

PiquetCarneiro

Crateús

Sobral

Itabaína

Macau

Aguiarnópolis

Estreito

Guaraí

Araguaína

Colina

Santa Inês

Barcarena

Altos

Coroatá

Açailândia

Balsas

Carajás

Oriximiná

Juruti

Marabá

Serra do Navio

Corumbá

Ladário

Miranda

Santa Maria

EsteioCorvo

Cacequí

Cruz Alta

Guarujá

Campinas

Jundiaí

Paulínia

Boa Vista Nova

LorenaJacareí

Araraquara

Mairinque

São José do

Rio Preto

Rondonópolis

Vilhena

Ribeirão CascalheiraLucas do

Rio Verde

Sorriso

Aracruz

Chapecó

Miguel d Oeste

Dionísio Cerqueira

Ipiranga

Brumado da Bahia

Tanhaçú

Ilhéus

Iaçú

Barreiras

Luis Eduardo

Ibotirama

Anápolis

SenadorCanedo

Alegrete

Guaíra

Santos

SabaráMuriaé

Campos do Goitacazaes

Ponte NovaLafaiete Bandeira

Unaí

Corinto

Sete Lagoas

Cruzeirodo Sul

Pelotas

RocasSales

Guarapuava

Apucarana

Itiquira

Cascavel

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FREIghT RAILwAyS IN BRAzIL

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A S S O C I A T E S

América Latina Logística (ALL)ALL is the largest railway logistics operator based in Latin America and acts in the states of São Paulo, Paraná, Santa Catarina, Rio Grande do Sul, Mato Grosso, and Mato Grosso do

Sul, in addition to Argentina, totaling 21,300 km in railways. In Brazil, the 11,699 km long network is interwoven

with the primary ports and transports steel products, iron ore, fuel, consumer goods, fertilizers, pulp,

and paper, among other cargoes.

Ferrovia Tereza Cristina (FTC)As the concessionaire that manages the railway south of Santa Catarina, this company’s main transport is coal from the

Criciúma region to the Jorge Lacerda Thermoelectric Complex, in Capivari de Baixo. The 164 km network also

includes the Port of Imbituba (SC), where cargoes of industrialized products arrive to supply both domestic and foreign markets.

Ferrovia Centro-Atlântica (FCA)As the main rail connection between the Northeast, Southeast and Midwest, FCA offers efficient and integrated solutions to its clients, transporting grain, sugar, limestone, cement, fertilizers, steel, and petrochemicals. Seeking to add competitiveness to its customers, FCA has more than 8,000 km of rail network integrated to high performance terminals and to the Port Complex of Tubarão through EFVM.

Ferrovia Norte-Sul (FNS)This railway covers Brazil from North to South, hence its name in Portuguese. It is integrated to the Port of São Luís, through the Carajás Railway, and to high performance terminals, serving as a logistical solution for the country’s new agricultural frontier, as well as for transportation of fuels, ores and fertilizers. Located in the region of influence of the states of Mato Grosso, Tocantins, Maranhão, and Piauí, FNS is committed to the efficiency and growth of its customers and partners.

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A S S O C I A T E S

11

MRS LogísticaMRS connects the states of Rio de Janeiro, Minas Gerais and São Paulo, serving a region that concentrates roughly 55% of the Brazilian GDP. The 1,674 km long network reaches the ports of Rio de Janeiro, Itaguaí and Santos, the latter the most important in Latin America. MRS focuses on integrated logistics and the transportation of general cargo such as ore, finished steel products, cement, bauxite, green coke, agricultural products, and containers.

Transnordestina Logística S.A. (TLSA)With a strong presence in the Northeast region of the country, TLSA connects the states of Maranhão, Piauí, Ceará, Rio Grande do Norte, Paraíba, Pernambuco, and Alagoas. Its mesh is about 4,207 km long. In partnership with the Federal Government and support from local state governments, TLSA is building the Nova Transnordestina Railway with 1,728 km of extension to integrate the new agricultural frontier in the cerrado region to the ports of Pecém (CE) and Suape (PE).

Estrada de Ferro Vitória a Minas (EFVM) EFVM handles about 40% of all rail freight in the country, especially commodities like iron ore, grain, coal, and steel products. The concessionaire also offers passenger

transportation, serving more than 1 million people per year between Vitória (ES) and Belo Horizonte (MG). With

905 km of extension, it is considered the most modern and productive Brazilian railway.

Estrada de Ferro Carajás (EFC) Part of the complex logistics of Vale, EFC unites the interior of Pará with the Port Terminal of Ponta da Madeira in São Luís (MA), the main port in the Northeast of Brazil. With a length of 892 km, the railway moves Vale’s ore production in Carajás

(PA) and transports general cargo for third parties, such as fuel, pig iron and grains,

especially soybeans and corn. EFC also offers a regular passenger service

connecting the states of Pará and Maranhão.

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Associação Nacional dos Transportadores FerroviáriosSetor de Autarquias Sul − Quadra 01 − Bloco J − Edifício CNT, Torre A, Sala 605 − CEP 70070-010, Brasília (DF)

Phone [55] [61] 3226-5434

The National Association of Rail Carriers (ANTF) brings together the private concessionaires of rail freight transportation in Brazil, created in 1996 with the sector’s denationalization

process. Together, member companies operate 28,366 km of railways (94% of existing networks), through which about 25%

of all national cargo flows.

ANTF’s mission is to develop and improve the rail freight transportation system granted to the private sector. The

organization serves as a benchmark in the industry, helping to integrate and consolidate the freight railways as a modern,

efficient and essential industry for the development of the country.