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UPDATE 1-CVRD railroad in Brazil reopens after protest

Thu Oct 18, 2007 5:40pm EDT

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(Recasts with end of protest)

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RIO DE JANEIRO, Oct 18 (Reuters) - A railroad owned by Brazilian mining giant CVRD began to operate late on Thursday after authorities dispersed landless peasants that had been blocking the tracks in protest for two days, the company said.

The protest, which CVRD said was part of a broader campaign by the landless group against "imperialism," disrupted iron ore shipments and briefly left a pellet plant in Maranhao owned by the company without raw materials.

The Carajas railroad run by CVRD, the world's biggest iron ore miner, transports 250,000 metric tonnes of iron ore per day from one of its main mines there.

The protest stopped 2,700 daily train carriages from running, Companhia Vale do Rio Doce (VALE5.SA)RIO.N, said in a statement. CVRD did not provide estimates on how shipments of ore and pellets from Brazil to world buyers were affected.

The Maranhao plant in Brazil's northeast produces 6 million tonnes of iron pellets a year.

CVRD said some 200 members of the radical leftist Movement of Landless Rural Workers (MST) invaded the tracks near the town of Parauapebas in northern Para state in the lower Amazon basin on Wednesday.

The militants threw stones at a passing train, after which traffic was suspended.

CVRD said the protesters, which later swelled to about 400, had brought tractors and supplies of food, indicating a likelihood of a prolonged siege. The protesters remained camped out near the train tracks, CVRD said.

The company said the protest had nothing to do with its operations as the protesters' slogan was "in defense of agrarian reform and against imperialism."

On Tuesday, landless militants invaded tree plantations of Votorantim VCP.N(VCPA4.SA) and Stora Enso (STERV.HE) paper companies, destroying saplings as part of a protest against multinational agricultural firms.

The MST and similar groups frequently occupy farms, block highways, torch crops, and stage rallies mostly to pressure the government to redistribute more land to the poor.

Brazil's powerful farm lobby says the MST scares off investments by challenging private property rights. CVRD said such protests compromised the image of Brazilian companies with their clients abroad.



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