The Brazil Steel Institute (IABr) has announced a revision of its steel production and trade forecasts for 2013. Accordingly, Brazil's crude steel production is expected to reach 34.5 million mt in the current year, almost the same as the figure recorded in 2012. Brazilian steel exports are expected to total 8.5 million mt in 2013, down 13 percent compared to last year, and imports are expected to amount to 3.2 million mt, down 14.4 percent compared to in 2012. The IABr noted that the indirect steel imports (contained in goods such as machinery and vehicles) rose by 17.7 percent in the January-July period of 2013, which shows the loss of competitiveness of domestic industry against imported materials. Domestic steel sales are expected to total 22.8 million mt this year, which means 5.3 percent more than last year, while apparent consumption will rise to 26 million mt, up 3.2 percent over 2012.
The IABr said that the loss of competitiveness of Brazilian products and excess supply of steel in the international market explain the significant drop in Brazilian exports. Furthermore, the impact of direct and indirect imports of steel in the country led the industry to operate at 70 percent capacity when, historically, the average capacity utilization was above 85 percent. It is estimated that the apparent consumption of steel products in Brazil is expected to reach a level of 27 million tons in 2014, rising 3.8 percent compared to 2013.
According to the IABr, Brazilian steelmakers produced 2.9 million metric tons (mt) of crude steel in July of the current year, reflecting a 2.2 percent decrease from June 2012 and up 3.5 percent compared to May this year. Brazil's rolled steel product output totaled 2.2 million mt in July, falling by 2.7 percent month on month and up 0.6 percent year on year. Of this total, the country's flat steel output stood at 1.2 million mt, falling 4.9 percent from June and down 2.2 percent year on year, while Brazil's long steel output amounted to 1 million metric tons, stable month on month and up 4.3 percent compared to July 2012.
Meanwhile, year-to-date production through July 2013 was 19.9 million metric tons, 2.2 percent lower than in the first seven months of 2012. In the first seven months this year, Brazilian rolled steel output increased by 1.7 percent to 15.3 million metric tons, including 8.7 million metric tons of flat products - up one percent, and 6.6 million metric tons of long products - up 2.7 percent, all compared to the corresponding period of 2012.
Brazilian domestic steel sales in the first seven months totaled 13.25 million metric tons, increasing by 3.6 percent compared to the same period last year. Brazil's exports of steel products in the January-July period of this year totaled 4.9 million mt, worth US$3.3 billion, with decreases of 16.9 percent in volume and 21.9 percent in value compared to the corresponding period of 2012. Meanwhile, the country's total steel imports in the first seven months amounted to 2 million metric tons (US$2.5 billion), representing a 10.6 percent decrease from the same period last year.
