Brazils association of flat steel distributors,
Inda, expects a poorer performance this year on the back of a
weaker-than-expected economy aggravated by social
Sales in the
distribution chain are not expected to grow beyond 2.5 percent
this year, far below the 6 percent the association had been
predicting until April, Inda president Carlos Loureiro told
journalists June 25 in São Paulo.
Shipments totaled 1.79
million tonnes in the first five months of this year, down 2
percent from a year earlier mainly because of a surge in
indirect steel imports. "The increase in these indirect steel
imports is (a negative) for the Brazilian (steel) industry, as
the replacement of these imports (by domestic production) is
more time-consuming," Loureiro said.
Brazil also faces a
challenging economic environment with an unusual blend of
inflation and low growth rates. The countrys gross
domestic product (GDP) had been expected at the beginning of
the year to rise by 3.5 percent in 2013, but the latest
forecasts point to growth rates below 2.5 percent.
Adding more pressure
to the economy is the recent wave of riots, which have
culminated in the biggest demonstrations in 20 years.
Such "turmoil" might
cause "some production problems," Loureiro said. "There is a
fall in retail sales, and when retail falls it affects the
manufacturing industry. Everyone (in the steel distribution
chain) has been facing more difficulties to sell."
A version of this article was first published by AMM sister
publication Steel First.