Brazil is expected to reach a final decision in the recently proposed hikes for steel imports in the coming days or within two weeks, a minister said.
According to Armando Monteiro, Brazil’s minister of development, industry and foreign trade (MDIC), the whole world is adopting measures to protect their domestic steel markets and Brazil should also do so. However, before making a final decision, Brazil’s productive chain should be heard, according to the minister.
“The government is studying [such a measure]. In the whole world, thanks to challenges in the steel markets, there has been a multiplication of trade defense measures, which are being adopted by different countries to protect their domestic markets, be those actions safeguarding or AD [measures]. Brazil can’t avoid looking at it,” he said.
Media reports said Brazil’s government created a working group to carefully analyze the proposed hikes in the imports tariff for steel products.
Gerdau’s CEO, André Gerdau Johannpeter, said at the same time Brazil analyzes the possibility of increasing the imports tariff for steel, it also discusses with the government the return of the Reintegra program, a credit substitution regime for exporters.
Despite sounding as good news for most local producers, trade groups have opposed the move.
Recently, Abimaq, Brazil’s association for the machinery industry, opposed the move by saying in a letter to Monteiro it would be a blow to the “already struggling competitiveness of the transforming industry, which uses the steel to manufacture its products.”
Carlos Pastoriza, president of Abimaq’s administration council, said the proposed increase in the imports tariff for steel products will go in the “wrong direction” when compared to what the developed and industrialized economies do.
The executive said such countries usually have “scalable” imports tariffs, “since raw materials always have a smaller aliquot than the products of higher added value, just to give competitiveness to the industries that aggregate more value and generate more technological development.”
Media reports suggested the imports tariff for steel products could rise to up to 20 percent, from duties currently ranging from 8 to 14 percent.