On Wednesday morning, an explosion at the Volta Redonda plant of steelmaker Companhia Siderúrgica Nacional (CSN) left dozens of employees with signs of intoxication and brought production to a halt. Several workers were rushed to the hospital and company shares took a hit at exchanges in São Paulo and New York. This was the latest in a series of accidents at the company in the last 12 months.

</span></p> <p><span style="font-weight: 400;">Early in the morning, a loud explosion was heard in Volta Redonda, a city northwest of Rio de Janeiro which is home to CSN&#8217;s Presidente Vargas plant. Local residents woke up to a large cloud of smoke hanging over the steelworks and the news that between 20 to 30 employees were receiving medical treatment for suspected poisoning.</span></p> <p><span style="font-weight: 400;">CSN released a statement affirming that the incident took place during the steel making process, and occurred due to the &#8220;transfer of liquid slag which probably came into contact with humid areas inside the disposal container. This contact generated air displacement causing a large detachment of dust in the sector.&#8221; At least 20 employees are suspected to have inhaled this dust and were given medical attention. </span></p> <p><span style="font-weight: 400;">CSN&#8217;s shares on the São Paulo </span><a href="https://www.infomoney.com.br/onde-investir/acoes/noticia/8042858/acoes-da-csn-subiram-79-so-neste-ano-e-os-analistas-acham-pouco"><span style="font-weight: 400;">stock</span></a><span style="font-weight: 400;"> exchange opened the day down 1.77 percent, while similar falls were seen in New York, both coming below the overall composite index for both exchanges. By noon, prices had made tentative recoveries.</span></p> <hr /> <p><img class="alignnone size-full wp-image-17474" src="https://brazilian.report/wp-content/uploads/2019/05/export-JQp1z.png" alt="" width="1200" height="800" srcset="https://brazilian.report/wp-content/uploads/2019/05/export-JQp1z.png 1200w, https://brazilian.report/wp-content/uploads/2019/05/export-JQp1z-300x200.png 300w, https://brazilian.report/wp-content/uploads/2019/05/export-JQp1z-768x512.png 768w, https://brazilian.report/wp-content/uploads/2019/05/export-JQp1z-1024x683.png 1024w, https://brazilian.report/wp-content/uploads/2019/05/export-JQp1z-610x407.png 610w" sizes="(max-width: 1200px) 100vw, 1200px" /></p> <hr /> <h2>A tortuous year</h2> <p><span style="font-weight: 400;">Wednesday&#8217;s incident was the fifth occupational accident at the Presidente Vargas plant in the last 12 months. In August of last year, a CSN employee died after suffering burns on 85 percent of his body during maintenance operations. That same month, a fire broke out at the plant&#8217;s raw materials area, though no-one was hurt.</span></p> <p><span style="font-weight: 400;">In March, seven employees were hospitalized after a similar incident to Wednesday&#8217;s explosion.</span></p> <p><span style="font-weight: 400;">Besides these occupational issues, the mood of CSN&#8217;s shareholders is also low, after the company posted first-quarter profits of BRL 87 million last week—far below expectations and a significant drop from last year&#8217;s profit of BRL 1.5 billion.</span></p> <h2>The importance of the CSN</h2> <p><span style="font-weight: 400;">CSN&#8217;s Presidente Vargas plant in Volta Redonda played a crucial part in Brazil&#8217;s history, being involved in the country&#8217;s decision to ally with the United States and </span><a href="https://brazilian.report/guide-to-brazil/2017/10/15/brazil-world-war-ii/"><span style="font-weight: 400;">join World War II</span></a><span style="font-weight: 400;">.</span></p> <p><span style="font-weight: 400;">After the U.S. officially declared war on the Axis in December 1941 (in the wake of the attack on Pearl Harbor) the country sought support from fellow nations in the Americas.</span></p> <p><span style="font-weight: 400;">Brazil, which was home to significant populations of German and Italian immigrants in its Southeast and South regions, had previously declared its neutrality.</span></p> <p><span style="font-weight: 400;">The U.S. saw Brazil&#8217;s Northeast coast as strategic territory and tried to convince the country to join the war effort. In what was later known as the Washington Accords, the U.S. granted a USD 100 million loan to Brazil to boost its steelworking industry, in exchange for Brazil formally entering the war in 1942. This money was used to build the Presidente Vargas plant in Volta Redonda.

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MoneyMay 15, 2019

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