27th Brazilian Steel Conference - Instituto A£§o gerdau a£â€ominas s.a. gerdau a£â€os especiais s.a. gerdau

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  • LETTER FROM th27 Brazilian

    Steel Conference

    STEEL CONSUMPTION IN BRAZIL DROPS BACK TO FIGURES OF ONE DECADE AGO AND EXPORTING IS THE ONLY SHORT-TERM SOLUTION

    thThe Brazil Steel Institute held, on June 08 and 09, in São Paulo, the 27 Brazilian Steel Conference, gathering about 500 attendees, including players of the steel industry, government, metal mechanical chain industries, banks, consulting firms, academy, members of parliament and the press. The conference opening ceremony was graced by the São Paulo State Governor, Geraldo Alckmin, the Executive Secretary of the Ministry of Industry, Foreign Trade and Services, Fernando de Magalhães Furlan, and the First Secretary of the Chamber of Deputies, Deputy Beto Mansur.

    Against the backdrop of the economic recession in Brazil and the adverse international steel market scenario, speeches and debates throughout the conference mainly addressed the harsh situation of the Brazilian steel industry which is enduring the worst crisis of its history.

    The combination of cyclical and structural factors significantly impaired the steel-intensive industry activities, thus strongly impacting the internal demand for steel products and deepening the persistent deindustrialization process in the country.

    The forecasts of the apparent steel consumption for 2016 amount to 18.2 million tons, a threshold of 2006, that is, one decade backwards. In this scenario, the only short-term solution is to export. That was the main conclusion drawn at the 27th Brazilian Steel Conference.

    Over the conference, the aggravation of the steel industry crisis was underlined. After a staff drop-off of 29,740 people over the 2014 and 2015 span, the industry estimates are to close the first half of this year with about 11,300 dismissals. Five blast furnaces are shut down. The Brazilian steel industry currently operates under 60% of its installed capacity, the lowest level reached to date, directly impacting the companies' result. To resume its historical level of 80%, the output has to be incremented at about 8 million tons. However, it is capital that exports keep sustainable. Despite the increase of 40% in exports over the last year, the revenue decrease reached 3.3%. Therefore, Brazilian steel needs to be internationally competitive. This competitiveness setback, only considering the financial cost and tax and charges, amounts to more than USD 60/t steel. The return of the Reintegra tax rate (Special Regime for Reintegration of Tax Amounts for Exporting Companies) was advocated by processing industry players attending the event.

    Other widely discussed issue in the conference concerns China, which holds more than half of the worldwide surplus installed capacity (440 million tons), and has been keeping the pace of exports at 130 million tons upon subsidized and farfetched prices. A consensus was reached that China cannot be recognized and a market economy.

  • www.acobrasil.org.br/english

    APERAM SOUTH AMERICA

    ARCELORMITTAL AÇOS LONGOS

    ARCELORMITTAL TUBARÃO

    COMPANHIA SIDERÚRGICA NACIONAL - CSN

    GERDAU AÇOMINAS S.A.

    GERDAU AÇOS ESPECIAIS S.A.

    GERDAU AÇOS LONGOS S.A.

    SIDERÚRGICA NORTE BRASIL S.A. – SINOBRAS

    THYSSENKRUPP CSA - CIA. SIDERÚRGICA DO ATLÂNTICO

    USIMINAS

    VALLOUREC & SUMITOMO TUBOS DO BRASIL - VSB

    VALLOUREC

    VILLARES METALS S.A.

    VOTORANTIM SIDERURGIA S.A.

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