The Brazilian steel industry has witnessed notable shifts in early 2024, with crude steel production increasing by 6.2% in the first quarter, reaching 8.3 million tons.
This growth occurs against a backdrop of surging imports, particularly from China, which rose by 25.4% year-on-year to 1.3 million tons.
These imports have grown by an alarming 49.9% over the first eleven months of the year.
The impact of these imports is profound, affecting local production and employment.
Usiminas and other major steel producers consider operational cutbacks, even furnace shutdowns, due to reduced domestic demand and foreign competition.
This reflects a broader trend where heightened imports have placed considerable pressure on the local industry.
Domestically, the sales of crude steel have dipped, with internal sales dropping by 6% compared to the previous year.
Brazil’s stagnant per capita steel consumption contrasts sharply with significant growth in countries like China and South Korea.
The global economic situation, characterized by recessions and rising interest rates, complicates matters further.
This has led to excess capacity globally, forcing steel-producing nations to search for new markets, adversely affecting Brazilian producers.
In response, the Brazilian steel industry has been advocating for higher import tariffs, aiming to align them with those in the U.S. and EU to combat the dumping of cheap steel in the market.
As Brazil navigates these complex challenges, the industry is focusing on balancing protectionist measures to safeguard local jobs and production.
Simultaneously, it addresses the need for economic competitiveness on a global scale.
The ongoing adjustments in fiscal and trade policies are critical to shaping the future sustainability of this crucial sector.