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| Brazil Steel |
Growing Risks of Steel Oversupply in Brazil
Brazilian steel producers urge swift implementation of import safeguards as global steel trade imbalances worsen. The European Union’s recent proposal to tighten steel import quotas and impose a 50% tariff mirrors moves by the US and Canada. Consequently, Brazil faces increased pressure from diverted steel exports, primarily from Asia, threatening its domestic market stability. The focus on import defense is now critical to prevent Brazil from becoming a dumping ground for below-cost steel.
Impact of Rising Imports and Policy Gaps
Steel imports surged 30% in Brazil from January to August 2025, eroding about one-third of the domestic market share. Without robust trade defense mechanisms, Brazilian mills suffer from unfair competition, unlike their counterparts in the US and EU. Despite anti-dumping duties and quotas, Brazil lags behind in protective policies. This regulatory gap allows opportunistic exporters to redirect excess steel, undermining local producers and risking broader economic repercussions.
Export Shifts and Competitive Pressures
The US tariffs on Brazilian steel have redirected exports mainly toward the EU, especially Italy, forcing Brazilian mills to lower prices by roughly $10 per tonne to secure market share. This shift underscores Brazil’s vulnerability to global trade dynamics and emphasizes the need for effective import safeguards to support domestic producers. Strengthening these measures will help Brazil maintain competitiveness and reduce dependence on unstable foreign markets.
ScrapInsight Commentary
Brazil’s steel industry now confronts escalating risks from global steel oversupply and insufficient trade defenses. Without prompt policy action, Brazilian mills risk market share erosion and profitability decline. Stronger import safeguards will be essential for Brazil to navigate global trade tensions and sustain long-term industrial growth.
