Steel Industry News
Brazilian Steel Producers Defend Import Tariffs
Wednesday, 16, June 2010
With the greatest respect to Roger Agnelli, chief executive officer of Brazil’s Vale, he may head up the largest iron ore company in the world but how he keeps a straight face sometimes begs an answer. In a recent Reuters article, Mr. Agnelli is said to have warned that reducing, or heaven forbid removing, import taxes on steel products would weaken Brazilian steel producers and could have very serious consequences for the domestic market.
Hold on a minute Mr Agnelli. Brazilian steel producers are said to be (literally) sitting on top of some of the lowest cost and highest grade iron ore and coking coal deposits in the world. As a result of the vertically integrated nature of domestic producers, Vale itself only sells about 10% of its production in the domestic market. Along with Russia, India and Ukraine, Brazilian steel producers are said to have some of the lowest power costs.
