Brazilian flat steel producers have announced a price increase of at least 10% on all their products, because of a lack of material at a time of steady demand, Fastmarkets heard on Monday September 14.
While most market participants expected increases in the range of 10-13% for October, some have reported price increases of 15%. The latest price changes add to a series of rises that started in July.
In the first two weeks of September, steelmakers fully applied a ۱۰% price increase announced in the previous month.
*** Steel hot-rolled coil
Fastmarkets’ latest price assessment for steel hot-rolled coil, domestic, monthly, exw Brazil, was 3,150-3,200 Reais ($592-601) per tonne on September 11, up by 11-13% from 2,800-2,885 Reais per tonne on August 14.
September’s price was also up by 19.50-20.50% from the level of 2,636-2,655 Reais per tonne in June, when the market was heavily affected by the Covid-19 pandemic.
*** Steel cold-rolled coil
The price assessment for steel cold-rolled coil, domestic, monthly, exw Brazil, was 3,600-3,620 Reais per tonne on Friday, up from 3,330-3,385 Reais per tonne on August 14, while that for steel hot-dipped galvanized coil, domestic, monthly, exw Brazil, reached 3,900-4,000 Reais per tonne, up from 3,590-3,660 Reais per tonne in the same comparison.
The motives for the most recent increases were a lack of imported material to offer price competition, low supply, and a recovery in demand with fears lessening about the Covid-19 pandemic.
“All distributors are reporting a lack of material. Prices will remain high until inventories are replenished,” a Brazilian distributor said.
Inventories at Brazilian flat steel distributors stood at 828,200 tonnes in July, down by 3.20% from 855,500 tonnes in June, according to national flat steel association Inda. July’s stocks would equate to about 2.4 months of sales.
The Brazilian steel industry was operating around 60% production capacity, up from 42% in April, but still far from the ideal level of 80%, according to national steel association Instituto Aço Brasil.
Some distributors were booking imports of specific materials because supply from the local market was expected to remain poor for the next several weeks.
But high prices for imported material were limiting the amount that buyers were able to import. Importers were focusing on coated steel products and certain grades of heavy plate, sources said.
“If steelmakers fully apply the price increase set for October, there will be room to increase imports,” another distributor said.
***Steel hot-dipped galvanized coil
Fastmarkets’ price assessment for steel hot-dipped galvanized coil, import, cfr main ports South America, was up on September 11 to $675-690 per tonne, compared with $650-665 per tonne on September 4, and $630-655 per tonne on August 14.
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