Steel production in Brazil has a high of 50.7% in May
O Estado de S. Paulo
The Brazilian steel production grew 50.76% in May in relation to the same month of 2009, while the world production showed an increase of 29.1% in the same comparison. Despite the weak basis of comparison of the last year - when the sector collapsed with the world crisis and the Brazilian steel industry was forced, for the first time, to shut down blast furnaces - the numbers show a continuing recovery of the steel market. According to analysts there is a large space for the recovery of the production in the world, since the United States and Japan have not yet returned to pre-crisis levels and European countries have a spare capacity yet high. In Brazil, the installed capacity could hit its ceiling next year and, with the domestic demand heated, the yellow light of shortages could spark already in 2012.
The World Steel Association showed yesterday that the rate of utilization of the worldwide installed capacity, considering data from 66 countries, was 82% in May, a slight decrease compared with 83.4% in the previous month. Raphael Biderman, senior analyst of steel of Bradesco, remember that, in Brazil, this percentage is already 90%, and that the country should hit the 100% next year, with the reactivation of the last inactive furnace of Usiminas.
According to Biderman, the domestic sales are strongly heated: only in May grew 12.7% compared to April. Another indication of the trend is the proportion of sales of CSN and Usiminas in Brazil, showing that the companies are driving steel that was once exported to supply the national market. The average was 75% of sales to the domestic market, today the percentage is nearly 80% to 85% of the total sales. The analyst adds that statistics point to a high of 55% in sales in 2010, a percentage far above the 20% projected in January by the domestic market. For him, this move makes room for Usiminas make a second round of price increase in July, after the adjustment of Vale. The last adjustment made by the company was only of 10%, while, since the beginning of the year, iron ore rose between 130% and 140%. On the other hand, Julian Navarro, from BES Securities, notes that the spare capacity of mature markets like Europe may hinder the recovery of prices.