Gerdau’s Profits Fall as U.S. Tariffs Help, but Brazilian Steel Faces Surge of Imports

Metalúrgica Gerdau, the company behind one of Latin America’s largest steel producers, has just released new quarterly results that highlight how global trade policies and foreign competition directly affect local businesses.

Gerdau earned an adjusted profit of R$863 million ($154 million) in the second quarter of 2025. While this profit improved compared to last quarter, it dropped 9% compared to a year ago.

Sales rose 5.5% to R$17.53 billion ($3.13 billion), but earnings before key expenses (EBITDA) slipped slightly, signaling that higher sales did not translate into higher profits.

The key story is where these results come from. Nearly two-thirds of the company’s core profit now comes from its North American businesses—by far the highest share in the company’s history.

The U.S. government made it more expensive to import steel by raising tariffs, which led buyers to choose American-made steel. This trend boosted Gerdau’s sales, ensuring solid business in the U.S. even when the overall market remained flat.

Things look much tougher in Brazil, Gerdau’s home market. Steel imports soared, especially from China, grabbing 26% of the Brazilian steel market in mid-2025, a record level.

This increase in imports put heavy pressure on local prices and profits, even though Brazil tried to protect its industry by adding new tariff quotas.

Gerdau’s Profits Fall as U.S. Tariffs Help, but Brazilian Steel Faces Surge of Imports

Gerdau and other companies argue that these measures have not been enough, as imported steel keeps flooding in, undercutting local suppliers.

Sales data reflect these shifts. North American sales saw a small but helpful uptick, while Brazilian sales dropped 5.2% compared to the prior quarter, dragged down by falling exports.

South America outside Brazil saw more exports too, led by Argentina, but overall demand there stayed weak.

Financial strength remains, as Gerdau’s borrowing compared to earnings is about 0.85 times—a bit higher than before but still not worrying for a company of this size. The company also announced R$79.5 million ($14 million) in dividends for shareholders.

Why should this matter to international readers? Gerdau’s results show how fast government decisions—like U.S. tariffs or Brazil’s import controls—can change fortunes for manufacturers.

The story is not just about steel, but about jobs, supply chains, and the risks of relying too much on global imports for critical goods.

Gerdau’s results are a clear signal of how trade policy, local industry, and foreign competition shape the future of production everywhere.

Related coverage: Central Bank of Brazil Ends String of Rate Hikes, Holds Selic Steady at 15% · EcoRodovias Profits Fall in Q2 2025 as Big Bets on Highways Trigger Rising Debt · American Tariffs Deal Heavy Blow to Brazil’s Aluminum Industry · New U.S. Tariffs Batter Brazil’s Stocks as Market Eyes Tougher Times

This article was produced by The Rio Times’ automated newsroom system. How we use AI · Report an error

LatAm Markets: Live Signals → — real-time movers, turnover leaders and FX across Latin America.