CSN sees positive outlook for Brazil in 2020

Monday, 09 December 2019 00:21:04 (GMT+3)   |   Sao Paulo
       

Brazilian steelmaker Companhia Siderurgica Nacional (CSN) said last week it expects a positive outlook for Brazil in 2020. CSN told investors in New York the positive outlook is due to the improving Brazilian economy, the company’s stronger mining business, a better scenario for the domestic steel market, and the company’s reduced net debt. 

CSN said it expects a “boost” in Brazil’s domestic demand for steel, saying there has been an “ongoing domestic recovery,” with declining interest rates in the economy, controlled inflation, real interest rates reaching historic lows, increased investments in the country and stronger business confidence.

CSN said the country’s economic recovery will “support” Brazil’s flat steel demand, adding that reduced steel costs lead to higher margins, which are reaching “historical levels.”

“Further upside comes with price increases,” it noted. CSN estimated its EBTIDA per metric ton for its flat steel business in Brazil could reach $105/mt in 2020 and $165/mt by 2023.

On the mining side, CSN said it expects improved cash costs for its iron ore business, while the commodity’s price is expected to remain high.

“Low production costs and diversified consumer market guarantee strong EBITDA and cash generation,” CSN said.

CSN told investors some of the company’s key medium to long term goals are growing in the mining sector, while remaining competitive in the steel business.


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