Brazil is expected to increase the import tariff for steel products to up to 20 percent, from duties currently ranging from 8 to 14 percent, a minister said on Wednesday.
Media reports said the measure, determined by president Dilma Rousseff and still being considered by the government, is aimed to help the nation’s struggling steel industry.
Last week during the Alacero conference, Jefferson de Paula, the association’s new president, defended more protection for what he labeled as “unfair trade.”
Talking to SteelOrbis and other reporters in the sidelines of the Alacero conference, the Brazilian executive said IABr, Brazil’s steel institute, was already working with local government to protect the domestic steel segment. “We need to have a provisional protection for the nation’s steel industry. I’m not defending a country, which is closed to global trade, but I support the idea that we need sometimes to protect our markets,” he said.
When asked by SteelOrbis what IABr is doing in terms of negotiations with the government, Paula, who is also part of the council of the trade group, said it is “urging for measures to protect the country against the unfair trade.”
“If the trade isn’t far, then we’ll keep working. If I’m going to export just to lose money, then I won’t export at all. Our strongest competitor in Latin America is the Chinese government, which is working through Chinese steelmakers,” he argued.
“The government should take actions. We can’t do anything. It’s the government the one who should take action. We never asked that and we don’t need to. Brazil’s steel industry is competitive,” he said.
Brazil’s finance minister, Joaquim Levy, said on Thursday that rising the imports tariff for steel products “is a possibility.”
“This is maybe the most obvious [possibility], but not necessarily the best one or a permanent one. We need to have a debate. We’re conducting a study on it. We already talked to Dilma and we’ll propose [alternatives]. We’ll see what’s compatible by looking at Brazil’s productivity,” the minister said.
In a press conference with journalists Levy acknowledged the issue is a global matter. “Lots of countries are taking measures. We’re studying measures, which are compatible with the investments made within the steel sector, but which won’t burden other sectors. It’s not easy. You have to think in competitiveness, not productivity,” he argued.
The ongoing discussions seem to point to a new direction in the relationship between the local steel sector and the government, as Brazil wasn’t planning any stimulus package for the segment.
A Brazilian minister said earlier this year during the Brazilian Steel Congress that the nation had no stimulus package for the country’s steel industry, despite declining sales and rising concerns about the loss of competitiveness of the segment.
“We have no stimulus packages [for Brazil’s steel industry]. What we have are channels that could stimulate the industrial activity such as the exports,” Armando Monteiro, the minister of development, industry and foreign trade, told reporters during a press conference at the IABr conference in Sao Paulo.
IABr said it will release next week in the city of Rio de Janeiro updated numbers for the local steel industry, which will include job losses, capacity utilization, among other data.