North Brazil: Metallurgy and Mechanics’ Industry of the Amazon

Interview with Roberto Stefaneli, IMMA (Metallurgy and Mechanics’ Industry of the Amazon)

Let’s begin by introducing our readers to IMMA. Can you give us a few key pieces of information about IMMA?

Bardella is a national company that began 102 years ago. Alstom Multinational and Bardella are both specialised in mechanical equipment and also equipment for generating energy from turbines. These two companies decided to create IMMA in the northern region of Brazil and chose Rondônia for its excellent energy potential. In 2008 IMMA was created between Bardella and Alstom equally. IMMA began operating on the 20th July 2009 on a partial scale and in January 2010 it was fully functional. It was created initially to supply the Santo Antonio hydroelectric plant on the Madeira River. IMMA made the hydroelectric and lifting equipment such as the flood gates and the lifting machinery etc. for this plant. Initially, IMMA was created for this particular project. Now we are in the final phase. 95% of the equipment necessary for this plant is completed.

In Rondônia we have the support of the State government and the municipal government. Both governments offered various incentives; they donated the area where we have our factory, which we built with 90 million reals of incentives and financing from the BNDES, the National Development Bank. We completed the construction in 2009/10. Our objective was to employ local workforce but this was a huge challenge. As IMMA is one of the first factories of capital goods in the northern region, there weren’t specialisations for our field of work e.g. sheet metal workers, solderers, sandblast and painters, so we had to begin projects to train people who were willing to work in IMMA in these positions. Today 80% of our workforce comes from this region. They have all been trained by us, and have come from all sorts of work backgrounds for example, agriculture and cattle breeding, trading, business, etc. We worked with the government as part of a training program in exchange for the incentives I mentioned earlier. So now we feel we have fulfilled our objective of training our workforce.

Today our challenge is holding on to this workforce. The people we have working in this sector are not used to working for such a long time in one place; they normally stay in one factory for a while and then move on. The idea of career progression is not very common; people are not used to specialising in one area and creating a career from it. So this is our challenge but I think we are making good progress. We currently have 500 employees, 350 direct employees and 150 indirect employees. On top of this we also have another 100 employees in tertiary sectors such as restaurants, security, cleaning, etc.

Can you tell us a bit more about the mechanical equipment that you make?

The IMMA factory is in the metallurgy industry. We make hydro mechanical equipment. We make floodgates that stabilise the water, and stop it from escaping, we make steel gates that are 20m by 23m high that are to assure the water flow can be stopped when necessary. We make the equipment necessary to change the course of the rivers. You have to change the course of the river to be able to build the hydroelectric plant and we produce the gates needed to do this. I am not an engineer, so I am explaining this as simply as possible. We also produce the gates that will direct the water flow towards the turbines to generate energy. This is the kind of equipment that we supply; gates, grates, heavy lifting equipment for building the turbines and the floodgates. These floodgates are so huge and heavy; they are made of steel and are 20m by 23m so they need to be lifted into place very carefully. We also make lifting equipment to bring the turbines into the plant.

Can you tell us about your imports?

The raw material used by IMMA is mainly steel; we consume a large part of the steel produced in the state of Minas Gerais. However due to the time demands for the construction and installation of this plant, we imported raw material from China and South Africa; depending on the strength of the dollar and the delivery times.

Is IMMA open to any type of joint partnerships or investment, national or international?

Any joint partnerships with IMMA would have to go through Bardella and Alstom. IMMA itself does not have the capability of negotiating partnerships; it has to be done through the partners.

You mentioned the challenge posed by the workforce, what are the other main challenges for IMMA?

The main challenge was the workforce, and training all these people because there was no history of industry here, so very little experience. It really was difficult to get the right workers and to train them up. Today the challenge is retaining this workforce we have qualified because of the culture here. It is changing and I’m sure we will overcome this. We are really happy; we have received help from the state and municipal governments so I think we are doing really well.

How do you see the future for IMMA in 2 or 3 years to come? What is your dream for IMMA over the longer term?

As I mentioned earlier, the potential in terms of energy in the northern region of Brazil is really large with all the rivers that we have here. Today we are building three more plants, the Belomonte plant, the Santo Antonio do Jari plant and the Teles Pires plant, which will keep us busy over the next few years. The contract for the Santo Antonio plant took 3 nearly 4 years to complete. These other contracts are shorter but should be for about a year or two.

In terms of the longer term; with the great energy potential that exists here there will be more energy plants to build and equip, to continue with the growth and development plans put forward by the government. We believe that by being here in this region we should obtain all these contracts for these plants and also contracts for work in neighbouring countries. Today the highway connects Rondônia to Peru, so we can supply Peru through this route. We believe we have a promising future.

To conclude, what is your message to any foreign investor thinking of coming to Brazil and particularly Rondônia to invest?

Rondônia has demand in every sector. It is a really young state, I think you have seen in your study that our economy began with the railway, then we had oil and now we have cattle breeding. The state lacks industry. Businessmen should come and analyse the potential, looking at raw materials for their industry, etc. We have had oil exploration but I imagine there must also be potential for the mineral industry for example. This is such a young state that there is potential for everything, there are many opportunities. We need everything here. I think even tourism offers great opportunities here.

Is there anything else you would like to add?

I would say that we are happy to be here in the northern region. There are a few governmental bureaucracy issues but I would say that is normal for a small state. We hope to have an industrial district similar to Manaus one day, that is our dream for the future, I hope we can have the government’s participation in this.