The Brazilian steel association, IABr, will file within the next 10 days a lawsuit in the nation’s Supreme Court, or Supreme Tribunal Federal (STF), over a reduced pay-back export program, known as Reintegra, executives said on Tuesday during the Brazil Steel Congress, held from 21-22 August in Sao Paulo, Brazil.
Marco Polo, president of IABr, said the local steel sector wants the pay-back export program to pay 2 percent instead of 0.1 percent.
“We’re filing the lawsuit within the next 10 days as a steel association, but steelmakers, individually, have also filed (a similar) complaint,” he told reporters.
Polo did not name the steelmakers which have already filed similar lawsuits over the Reintegra. Brazil’s steel sector has long requested the incentive to get back to the previous 2 percent aliquot, instead of 0.1 percent.
“We will now judicialize this discussion,” Polo said.
Polo and Sergio Leite, who has been named president of IABr’s directing council, also expressed concerned over the appreciated USD. This week, the USD reached the BRL 4 mark. “I think an USD equaling BRL 4 is too high,” said Leite. “We think a more adequate currency rate for the USD would be around BRL 3.50 and BRL 3.70.”
When questioned if an appreciated BRL would help steelmakers export more steel, Leite said costs also tend to increase, as raw materials, including coal and iron ore, are denominated in USD.
“We need (currency) stability, since an appreciated currency rate also raises our costs,” Leite said.