Brazilian flats steelmaker Usiminas is well positioned to take advantage of proposed hikes in steel prices both in the international and the domestic markets, a report from Citi Corretora said.
According to analyst Thiago Ojea, negotiations indicate steel prices could increase 25 percent at the Brazilian automotive sector and about 10 percent within local distributors.
“The probability of higher price hikes for the Brazilian automotive sector increased thanks to current price levels in the international market,” the analyst said.
“Usiminas would benefit it the most, given the fact 30 percent of its sales are destined to the automotive market, as opposed to 20 percent when compared to its peer CSN,” he argued.