Brasília – Steelmaking companies plan on investing BRL 100.2 billion (USD 19.6 billion) in Brazil by 2028. The amount was announced on Monday (20) following a meeting between industry representatives with President Luiz Inácio Lula da Silva, Vice President Geraldo Alckmin, and ministers of economic affairs.
The announcement comes less than a month after the government introduced import quotas for eleven steel products; if the maximum volume is exceeded, the import duty rose to 25%. The move is valid for 12 months after it was made official. In February, the government had restored import duties for five items.
On his social media, President Lula celebrated the decision of the industry and pointed out it comes after the launch of the restored Growth Acceleration Program (PAC) by the government and the announcement of investments amounting to BRL 130 billion (USD 25 billion) in Brazil’s automotive industry.
Vice President Alckmin said the policy of support for steel will help reduce the industry’s idleness level. “There has been a major concern regarding steel imports. Recent years have seen a very large growth in imports, thus raising the idleness level of a very important base industry,” he said.
Steelmakers and imports
According to the Brazil Steel Institute, the country imported some 1.3 million tonnes of steel, up 25.4% from a year earlier. In recent years, the industry has criticized the unfair competition from overseas, which were preventing the Brazilian production to grow.
Brazil Steel Institute chairman Jefferson de Paula stressed that the industry invested BRL 162 billion in 15 years and employs 2.9 million people. However, Brazilian steelmakers operate with roughly half of their capacity, having made 26.6 million tonnes compared to a potential production of 51 million. According to De Paula, last year 26% of the steel consumed in the country was imported, with 58% of it coming from China.
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Brazil increases tariff on steel product imports
Translated by Guilherme Miranda
