1. Leveraging the competitive advantages:
the 2006 capex budget
January 27, 2006
Companhia
Vale do Rio Doce

2. Disclaimer
”This presentation may contain statements that express management’s expectations about future events or results rather than historical facts. These forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those projected in forward-looking statements, and CVRD cannot give assurance that such statements will prove correct. These risks and uncertainties include factors: relating to the Brazilian economy and securities markets, which exhibit volatility and can be adversely affected by developments in other countries; relating to the iron ore business and its dependence on the global steel industry, which is cyclical in nature; and relating to the highly competitive industries in which CVRD operates. For additional information on factors that could cause CVRD’s actual results to differ from expectations reflected in forward-looking statements, please see CVRD’s reports filed with the Brazilian Comissão de Valores Mobiliários and the U.S. Securities and Exchange Commission.”

3. Capex of US$ 4.6 billion in line with strategic plan
Organic growth is the main driver of shareholder value creation
World-class assets and synergies with an efficient logistics infrastructure provide opportunities for high rates of return on projects

4. CVRD has an excellent track record of delivering: 14 major projects over the last four years
São Luís
Mo I Rana
Capão
Xavier
Taquari-Vassouras
Trombetas
Pier III
PDM
Fábrica
Nova
Alunorte 3
Sossego
Aimorés
Funil
Carajás
70 Mtpa
Candonga
Alunorte 4
Average ROIC : 33.7%

5. CVRD, a global leader of shareholder value creation
Large Cap1 Top Ten,
Source: The Boston Consulting Group
1 n=119 global companies with a market valuation greater than US$ 25 billion

6. The highest TSR among large mining companies
Annual average

7. Capex continues to be growth-focused: 77% of budget dedicated to growth
US$ 4.6 billion

8. Capex will increase US$ 1. 3 billion relatively to the US$ 3
Capex will increase US$ 1.3 billion relatively to the US$ 3.3 billion spent in 2005
US$ million
227
(558)
201
504
4,626
 SIB
891
 R&D¹
 Old projects
Cost increase
3,361
New
projects
Capex
2005
Capex
2006
1 US$ 100 million is due to Onça Puma

9. We are developing six very attractive iron ore projects
Total Capacity Start-up
investment increase
US$ million Mtpy
Carajás 85 Mtpy
Carajás 100 Mtpy
Brucutu ¹ 2006/07
Itabira
Fazendão ² 2007
Fábrica
1 Can be expanded to 30 Mtpy
² ROM

10. Iron ore production Mtpy
CVRD iron ore production grew at 15% per annum from 2001 to It is expected to reach almost 300 Mtpy in 2007
Iron ore production Mtpy

11. Exploring the long-term upward trend of pellets consumption
3 new highly competitive plants
Total Capacity Start-up
investment increase
US$ million Mtpy
Itabiritos
Tubarão VIII
Samarco¹ 1,
1 Samarco is a JV. Its project is not included in CVRD capex program.

12. Exploring our strong competitive advantages in the aluminum business
Paragominas, a new big bauxite mine
Capex US$ 548 million
Capacity 2007: 5.4 Mtpy
2008: 9.9 Mtpy
Alunorte, the world’s lowest expansion cost
Capex US$ 1.4 billion
Capacity 2006: 4.5 Mtpy
2008: 6.4 Mtpy

13. Alumina production Mtpy
CVRD alumina production grew at 13% per year from 2001 to 2005 and it is expected to reach 6.4 Mtpy in 2009
Alumina production Mtpy

14. CVRD will emerge as a fairly large global player in nickel
Total Capacity Start-up
investment increase
US$ billion Ktpy
Vermelho¹
Onça Puma²
1 Final product: nickel cathodes and cobalt (2.8 Mtpy).
² To be approved. Final product: ferronickel.

15. CVRD is investing in the logistics infrastructure to support the mining business
Ports
PDM - capacity to load 100 Mtpy of iron ore US$ 196 million
Tubarão – higher speed of ship loading US$ 65 million
Guaíba Island –  capacity to 49 mtpy from 43 Mtpy US$ 41 million
Sepetiba –  capacity to 21 Mtpy from 16 Mtpy US$ 28 million
Railroads
1,426 railcars & 22 locos US$ 200 million
EFC expansion US$ 153 million
Capex

16. Fostering iron ore consumption in Brazil - attracting steelmaking projects - taking advantage of the trend towards geographical reallocation of global steel capacity
Ceará Steel
Capacity: 1.5 Mtpy
CVRD Capex: US$ 25 million
DR pellets consumption: 2.5 Mtpy
Estimated start-up: 2009
CSA
Capacity: 4.1 Mtpy
CVRD Capex: US$ 200 million
Iron ore & pellets consumption: 7.1 Mtpy
Estimated start-up: 2008

17. CVRD – A global leader