BNamericas quoted Mr Andreis Bassi de Melo commercial director of Açovisa and marketing manager Mr Marçal dos Santos Junior as saying that the 500 million tonnes global steel overcapacity has been putting pressure on prices and margins throughout the entire steel chain distributors and industry included Sao Paulo based steel distributor Açovisa.

Brazil's steel industry has been struggling with global steel overcapacity, weak prices and a domestic output glut in the last couple of years. The issue has caused a surge in imports driving inventory up and capping sales growth.

The two said by email that "Imports have a negative impact for the sector, and they're not coming only from Asia, as we also have Eastern European products."

According to both executives, flat steel producers seem to suffer more, but long steelmakers also feel the imports impact. They said that "Besides the raw material costs impact, the worst thing is the increase of steel contained imports, where you have finished parts and products entering the country."

They said that the country's raw steel output expanded only 6% in 2011 compared to the 24% growth registered in 2010, when Brazil registered 24 year record growth.

Source - Business News Americas

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