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October IABr: Steel Imports Continue to Decrease

According to Instituto Aço Brasil (IABr), apparent steel consumption reached 2,275kt, down6.3% y/y but up 0.6% m/m, sustaining a 3.4% YTD increase. The annual drop was mainlydue to a 6.5% contraction in flats and a 6.0% decrease in longs, while monthly figures showedflats up 0.9% and longs nearly flat at +0.1%. Domestic sales fell 6.5% y/y and 4.0% m/m, withy/y declines of 6.9% for flats and 6.0% for longs; for the month, longs led the contraction at-4.9% while flats decreased 3.3%. Crude steel production totaled 2,988kt, contracting 2.7%y/y but rising 6.2% m/m, with longs down 5.8% y/y and flats up 1.6% m/m. Imports were473kt, down 21.4% y/y but up 6.2% m/m, highlighted by semi-finished imports plunging88.0% y/y and 61% m/m. Year over year, imports of flats and longs fell 5.2% and 5.5%,respectively, while monthly figures were offset by a 39.6% increase in longs and a 2.8% risein flats. While the y/y contraction is a positive sign for the Brazilian steel market, YTD importlevels remain high at 6.0% (Figure 2), mainly due to flat products, which are up 28.4% yearto date. Exports reached 907kt, up 28.1% y/y and 17.2% m/m, with flats leading the annualincrease at 36.1%.