Brazilian steelmakers say Chinese, Russian imports ‘flooding’ market

SAO PAULO – Cheaper steel from Russia and China is “flooding” Brazil’s market, the chairman of Brazil’s Aco industry group said on Tuesday, calling for higher taxation on steel imports.

Mr Jefferson de Paula, who also heads the Brazilian arm of No. 2 global steelmaker ArcelorMittal, said during an industry event that “Chinese and Russian companies are flooding the market with steel products at subsidised prices”.

Meanwhile, the country’s steel mills have an idle capacity of around 40 per cent, he said.

Brazil’s steel imports in 2023 through August jumped 49.5 per cent compared with the same period a year earlier, according to the industry group’s latest data, hitting 3.18 million tonnes.

At 61 per cent, the bulk comes from China.

“This is an emergency that is falling on a sector that invests and cannot continue to be vulnerable,” the industry group’s chief executive, Mr Marco Polo de Mello Lopes, told journalists.

Last week, the government announced that it will bring forward to Sunday the end of a temporary tax reduction on 12 steel products, which was established in 2022 and originally scheduled to end on Dec 31.

Mr Lopes said the measure “is no longer sufficient”, and called for the creation of a temporary 25 per cent tax on steel imports.

Said ArcelorMittal CEO Aditya Mittal, while attending the event virtually: “I don’t see China as being as serious a problem as it was 10 years ago.”

He noted, however, that countries should nevertheless “ensure fair trade”.

A series of trade actions against China as well as the country’s focus on controlling its emissions should curtail the growth of its steel production capacity, Mr Mittal added, saying the Chinese government “is not necessarily supporting exports” of steel.

Global steel demand should, according to ArcelorMittal, reach 2.5 billion tonnes by 2050 from 1.9 billion currently. REUTERS