Credit rating agency Fitch Ratings upgraded the long-term ratings of Brazilian flats producer Usiminas from BB- to BB. The company’s outlook remains stable, the agency said.
Fitch said the upgraded ratings reflect the company’s “low absolute and relative debt levels, manageable debt amortization profile, and performance despite the pandemic, and maintenance of a sound operating profile in the aftermath amid a positive steel environment in Brazil.”
This week, Brazilian steel association, IABr, posted increased crude steel and domestic sales figures in Brazil, as the local steel industry rebounds. Fitch Ratings forecasted Usiminas’ steel sales volumes in 2022 to reach 5.3 million mt and then 5.5 million mt in 2023, from 3.7 million mt in 2020.
“Steel prices remain high in Brazil amid supply constraints,” the credit rating agency said. “Flat steel consumption in January-April 2021 has been 45 percent higher than a year ago, according to (IABr). This is very supportive for Usiminas given its large share in the flat steel used in automobile and white goods production.”