A source from a small distributor in Rio de Janeiro told SteelOrbis that he remains selling shipbuilding grade plates, with more than 10mm in thickness, at BRL 3,045/mt ($751/mt), FOB, full taxes except IPI, the same price since a 5 percent increase in mid-December 2015.
But he warned that an additional 10 percent increase will be effective as of February 15, adding that the new increase will compensate for new price established by Usiminas. According to the source, Usiminas justified the price increase as a compensation for higher production costs.
He believes that with the reduced production at Usiminas, heavy plates became scarce in the domestic market, leaving space for another price increase, despite the reduced demand from virtually all industrial sectors in Brazil.
“I am not sure if we will be able to sell plates at more than BRL 3,300/mt ($809/mt), as we are already having problems in selling at BRL 3,045/mt ($746/mt),” he said, adding that the effective evaluation of the demand will be possible only after the carnival holidays, as January is usually a poor month in terms of steel sales in Brazil.
Usiminas has idled the steel production at its Cubatao plant, in the state of Sao Paulo, maintaining only rolling activities for HRC and CRC there, concentrating the production of heavy plates in the Ipatinga plant, in the state of Minas Gerais.
1 USD = BRL 4.08 (January 27)