According to data released by the Brazilian national iron and Steel Association, Brazil's crude steel production may decline by 8.2% to 32.5 million tons in 2019. Brazil's steel industry is expected to resume some production by 2020, with total crude steel production expected to increase by 5.3% to 34.2 million tons, the association said.
Marco Polo de Mello Lopes, head of the Brazilian national iron and Steel Association, believes that although crude steel production will increase in 2020, it will still be lower than the highest level of 34.4 million tons in recent years. Moreover, Brazil's steel industry can only achieve 67% capacity utilization in 2020, and only 60% in 2019. He said that the normal and sustainable capacity utilization rate should be around 85%.
In addition, from the perspective of plate demand, the more stable demand of plate market will depend on higher fixed asset investment, which may take longer to achieve. However, from the data of Brazil's automobile industry, in 2020, Brazil's plate demand may be driven by the automobile industry.
Carlos Jorge Loureiro, head of the Brazilian Association of steel dealers, expects Brazilian plate sales to grow by about 4.0% by 2020, supported by increased car production and increased agricultural equipment production. Luiz Carlos Moraes, President of the National Association of automobile manufacturers, said Brazil's total auto production in 2019 would grow by 2-3% year-on-year to 2.77 million vehicles, far below the annual record of 3.71 million in 2017.
