In a letter to the US trade representative, Jamieson Greer, Philip Bell, president of the Steel Manufacturers Association (SMA), accused the Brazilian government of strongly subsidizing the local steel industry.
In the context of a public consultation by USTR, to evaluate unfair commercial practices by other countries, Bell referred to Brazil as the “South American China”.
According to Bell, Brazil has a steel production capacity of 50.9 million mt per year but produced only 31.8 million mt in 2023.
Bell added that, despite its idle capacity, the country has recently announced a plan worth BRL 100 billion ($18 billion) to expand its capacity.
Bell quoted hurdles for the export of steel to Brazil, an average import tariff of 12.6 percent, that could be increased for some products to 20 percent or even 35 percent, and the AFRMM tax, that is charged on the freight rate, for the utilization of the Brazilian ports by the shipping companies.
He also quoted the development bank, BNDES, as a source of subsidized credit lines to the industry.
Brazil shipped to the US last year 70 percent of the US imports of slabs, a move defined by Bell as “an unnecessary supply”.