The company demands the introduction of a 25% import duty on steel products from Russia and China

Brazilian mining and steel company Gerdau announced the suspension of production at the Maracanaú steel plant located in the northeastern state of Ceara. SteelOrbis reports about it.

According to local media, 600 employees of the plant remained unemployed due to the shutdown of capacities, whose contracts were suspended since July.

Former CEO of Gerdau Gustav Werneck noted that the situation of these workers will not improve until the state introduces a 25% import duty on steel products, as an alternative to reducing the volume of imports of cheap steel from China and Russia.

The current import duty in Brazil ranges from 9.6% to 12.8%, but this is not enough to reduce the volume of imports, which increased by 48.6% y/y – up to 3.2 million tons for January-August 2023.

«Brazil should introduce a higher tax on steel imports, an alternative that has already been adopted by Mexico, the United States, the EU and some regions of South America,» the company emphasizes.

As GMK Center reported earlier, Gerdau in the second quarter of 2023 reduced supply of steel products by 1.5% q/q – to 2.93 million tons. On an annual basis, they decreased by 9.6%. The volume of steel smelting increased by 3% compared to the previous quarter – up to 3.07 million tons.

Also, Gerdau announced its intentions to invest $666.64 million in new production facilities in the state of Minas Gerais by 2026. By implementing the project, the company plans to increase iron ore production and reduce production emissions.