Posted on 06 Dec 2019
Brazilian steelmaker Companhia Siderúrgica Nacional (CSN) is set to increase both its flat and long steel prices from January 2020. The company indicated this to analysts during its first “CSN Day” at the New York Stock Exchange (NYSE) monitored by Kallanish.
The rise is necessary because domestic prices are nearly 4-6% below imported steel prices, and the real has weakened against the dollar.
According to CSN commercial director Luis Fernando Martinez, the company will raise prices by 10%. Negotiations with Brazilian carmakers are in the final stage and prices for annual contracts are expected to move up between 5% and 7.5%.
Gerdau and Usiminas have already informed of an increase in their steel prices for the domestic market. ArcelorMittal is also expected to follow the January rise, according to analysts.
Gerdau has prepared a price increase of between 8% and 12% for all long steel products to its distribution network from next month. Usiminas plans to adjust its flats prices upwards a further 5% on top of those already announced in October.
The planned adjustments will have a positive impact on the steel industry, analysts comment. "With the increase of domestic consumption, supported by new infrastructure projects and higher private construction activity, as well as improving demand in China, the Brazilian steel sector continues to have a positive outlook in the medium term,” says Guide Investimentos.
Despite the possible re-application of US Section 232 tariffs on Brazil, the analyst foresees a limited impact on the industry and remains confident over the recovery of the steel sector.
