Gerdau restarts billet production plant in Brazil

Brazilian steel company Gerdau has restarted its steel billet plant in Ceará, Brazil, according to Argus Media.

The plant was shut down for renovation in May 2024. The company invested R$200 million ($38 million) in it to improve efficiency and reduce its environmental impact.

The resumption of operations at this plant is part of Gerdau’s strategy to strengthen its position as a supplier of metal products in the north and northeast of the country. Local buyers are heavily dependent on imports, as trade with Brazilian plants is hampered by high domestic logistics costs.

Gerdau uses local mini-mills as a strategy to reduce logistics costs and increase the attractiveness of its products in the domestic market.

The plant in Ceará will focus on producing 12-meter-long billets. The company will roll them itself rather than selling them to third parties. The company’s semi-finished products will also be supplied to Gerdau’s mini-mill in Caucaia.

It should be recalled that in September last year, Gerdau warned that without decisive measures to support the metallurgical industry, Brazil risks losing its domestic steel production, which could have a negative impact on the entire industrial supply chain. The share of imported steel in the domestic market is now 22-25%, whereas previously it was 10%. Most of these imports come from China. In addition, the Brazilian steel industry was operating at 35% of its capacity.