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Mar.29.2024 1USD=7.095RMB
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Brazilian Flat Steelmakers Move Forward with Planned Price Increases

https://en.steelhome.com [SteelHome] 2019-03-20 11:16:47

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Brazilian flat steel producers have announced price increases to distributors for late March and early April, as a result of higher international prices and changes to the currency exchange rate for the country's Real, according to local flat steel association Inda.

"Domestically produced flat steel is currently around 7-8% cheaper than imported material," Inda president Carlos Loureiro said on Tuesday March 19.

Usiminas has announced a price increase of 10% for hot-rolled coil (HRC), cold-rolled coil (CRC) and heavy plate, and a rise of 15% for zinc-coated products.

Meanwhile, ArcelorMittal intends to impose an increase of 12.50% for HRC, 10% for CRC and 8.50% for zinc-coated products.

Gerdau has announced a price increase of 10.50% for heavy plate and 14.50% for HRC, according to Inda. Those price increases will take effect on April 1.

CSN, which has already publicly announced a price increase to become effective on March 25, has told distributors that it will raise prices of HRC and CRC by 15%, and zinc-coated products by 10%.

Other market participants contacted by Fastmarkets have confirmed similar price increases.

ArcelorMittal, Gerdau and Usiminas told Fastmarkets that they do not comment on their price policies. CSN did not respond to requests for comment at the time of publication.

Fastmarkets' latest monthly assessment of the price for Brazilian domestic HRC was 2,425-2,470 Reais ($636-648) per tonne ex-works on March 1. The price assessment for CRC was 2,655-2,745 Reais per tonne on the same day, while the price of hot-dipped galvanized coil (HDG) was assessed at 3,250-3,310 Reais per tonne ex-works.

The next assessments of Brazilian domestic prices will be on April 5.

The increase in international prices reflected higher costs for raw materials, according to Loureiro.

"It is unlikely that iron ore prices will fall in the short term," he said.

Fastmarkets' daily index for spot market iron ore 62% Fe reached $87.23 per tonne cfr Qingdao on March 19, down from $88.26 per tonne cfr on Monday.

Movements in the domestic currency were also making imported material more expensive, favoring a price increase by local producers.

The Brazilian currency was trading at 3.81 Reais to $1 on March 19, compared with 3.74 Reais to $1 on March 1.

News of the intended price increases could boost purchases from distributors and clients in March, if they try to build inventories ahead of the price change.

"March [sales] figures may be higher than expected," Loureiro said.

source: fastmarkets
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