Oct. 6 (Bloomberg) -- Brazil's Bovespa Index plunged 10 percent to the lowest in almost two years on concern the global economic slowdown and credit crisis will reduce earnings at the country's biggest commodity producers.

Usinas Siderurgicas de Minas Gerais SA and Cia. Siderurgica Nacional SA sank more than 12 percent after UBS AG stripped the steelmakers of their ``buy'' ratings. Cia. Vale do Rio Doce dropped to the lowest since January 2007 as UBS cut its 2009 profit estimate by 32 percent. Petroleo Brasileiro SA fell the most this decade as crude oil prices dropped below $90 a barrel on concern the credit crisis in the U.S. and Europe is deepening.

Trading was halted 20 minutes after the open as the Bovespa tumbled 4,491.84 points to 40,025.48, the lowest since November 2006. Trading will resume at 9:49 a.m. New York time.

Usiminas dropped 12 percent to 30.10 reais, while CSN fell 16 percent to 30 reais. Brazil's second- and third-biggest steelmakers were lowered to ``neutral'' from ``buy'' at UBS.

Vale sank 13 percent to 25.30 reais. Iron ore prices may fall 15 percent in 2009, compared with an earlier estimate for a 10 percent increase, UBS said. In 2010, iron ore may fall another 15 percent, it said.

UBS lowered its price forecasts for copper, aluminum and most bulk commodities amid concern a slowing global economy will hurt demand from builders and automakers.

UBS pared its forecasts ``on the back of the deterioration in demand fundamentals experienced over the past quarter and the likelihood that this could continue over the next 12 months at least,'' analysts led by Daniel Brebner wrote in a report today.

Petrobras fell 10 percent to 27.80 reais. Crude oil for November delivery slid as much as $4.99 to $88.89 a barrel in electronic trading on the New York Mercantile Exchange.

-- Editor: Allen Wan

To contact the reporter on this story: Alexander Ragir in Rio de Janeiro at aragir@bloomberg.net.

Last Updated: October 6, 2008 09:41 EDT