Business Monitor International


Brazil Metals Report

Published 19 March 2014

  • 61 pages
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  • Includes 3 free updated quarterly reports
 
$1,295.00
Brazil Metals Report

BMI View: We expect solid m etals consumption growth in Brazil through 2018 on the back of the automotive , construction and infrastructure sectors , among others. Despite delays in infrastructure spending under the Growth Acceleration Program me, we see an uptick in construction activity in H214 and 2015, which should drive both production and consumption higher. Furthermore, we forecast gross fixed capital formation (GFCF) to accelerate from 2015 through 2018. Additionally , we forecast support for the metals sector due to our forecast for average annual real GDP growth of 3.0% from 201 4 to 201 8 , with growth accelerating over the period.

Upside In 2015 Onward

We remain constructive towards the Brazilian metals sector over the medium term, though note we expect 2014 to see muted production and consumption growth. After disappointing economic data in 2013, a year in which overall economic growth and fixed asset investment slowed, we see activity picking up towards year-end 2014 and into 2015. For full-year 2014 though, we recently downgraded our forecast for real GDP growth from 2.5% to 2.0% and our forecast for gross fixed capital formation (GFCF) from 5.0% to 4.5%. Furthermore, infrastructure projects still face various delays, which presents a downside risk to our metals consumption and production forecasts this year. Yet from 2015 through 2018, we see a broader recovery, with GFCF averaging growth of 4.9% per year and real GDP growth averaging 3.3% per year. These growth forecasts are underpinned by our expectation for strong growth in metals-consuming sectors, including auto production, construction, and infrastructure.

Growth Accelerating In Years Ahead
Brazil - Real Growth Rates Across Sectors (% chg y-o-y)

The majority of Brazilian metals production is consumed within the country, a trend we expect to continue, providing an opportunity for companies to increase revenues and profits in the domestic market. Overall, we forecast that...

Table of Contents

BMI Industry View
7
Upside In 2015 Onward
7
SWOT
9
Metals SWOT
9
Industry Forecast
11
Steel: Consumption And Production To Grow At Moderate Pace
11
Consumption To Remain Subdued in 2014
11
Production Recovery By Mid-Decade
13
Table: Brazil - Crude Steel Production, Consumption, Growth and Balance ('000 tonnes)
14
Table: Brazil - Steel Industry Historical Data, 2003-2012 ('000 tonnes, unless stated otherwise)
14
Aluminium: Cheaper Electricity To Spur Production
14
Electricity Prices Pose Challenge To Production Growth
15
Consumption To Fare Better
17
Table: Brazil - Aluminium Consumption And Production, ('000 tonnes)
18
Copper: Consumption Growth To Outpace Production
19
Production Growth To Lag Consumption
20
Table: Brazil - Copper Consumption And Production ('000 tonnes)
20
Regulatory Development
21
Tax Regime
21
Corruption Remains Vexing
22
Table: Brazil - Political Overview
22
Commodities Forecast
24
Commodity Strategy
24
Steel: Subdued Medium Term Outlook
26
Aluminium: Despite Recent Upswing, Underperformance To Persist
27
Copper: No Time To Celebrate Yet
28
Lead: Outperformance On The Cards
29
Nickel: Sideways Movement In Weeks Ahead
30
Zinc: Positive Momentum To Continue
32
Table: Select Commodities - Performance & BMI Forecasts
33
Table: BMI Commodities Strategy
34
Steel Price Forecast
34
Table: BMI Steel Forecast
34
Short-Term Outlook
35
Core View
35
Global Steel Glut To Persist
36
Production: Rationalisation In The Long Term
36
Consumption: Growth Decelerating
38
Excessive Chinese Exports
39
Growing Arbitrage Between East & West
40
Risks To Price Outlook
40
Table: Steel Data & Forecasts
41
Table: Global Steel Prices By Region & Product, US$/tonne (ave)
41
Competitive Landscape
43
Table: Financial Data For Key Metals Firms Listed In Brazil, FY2013
43
Domestic Costs Weigh On Energy-Intensive Industry
44
Company Profile
45
Gerdau
45
Recent Financial Performance
46
Table: Gerdau - Key Financial Data
47
Cia Sider-rgica Nacional
48
Recent Financial Performance
50
Table: CSN - Key Financial Data
50
Vale
52
Company Overview
54
Company Strategy
55
Recent Financial Performance
56
Table: Vale - Key Financial Data
57
Company Details
57
Methodology
58
Cross Checks
58

The Brazil Metals Report has been researched at source, and features latest-available data for steel, aluminium and other major globally-traded commodities. Our analysis covers all primary indicators, including production, exports and price, with our forecasts underpinned by Business Monitor International (BMI)'s macroeconomists global economic outlook. The report analyses trends and prospects and critically evaluates latest industry news, trends and regulatory developments in Brazil.

BMI's Brazil Metals Report provides industry professionals and strategists, sector analysts, business investors, trade associations and regulatory bodies with independent forecasts and competitive intelligence on the metals industry in Brazil.

Key Benefits

  • Benchmark BMI's independent metals industry forecasts for Brazil to test other views - a key input for successful budgeting and strategic business planning in the Brazil metals market.
  • Target business opportunities and risks in Brazil through our reviews of latest industry trends, regulatory changes and major projects and investments.
  • Exploit the latest competitive intelligence and company profiles on your competitors and peers.

Coverage

BMI Industry View

Summary of BMI's key forecasts and industry analysis, covering metals production and prices, plus analysis of landmark company developments and key changes in the regulatory environment.

SWOT Analysis

SWOT (Strengths, Weaknesses, Opportunities and Threats) analysis of the state's metals sector, business environment, politics and economics, which carefully evaluates the short- and medium-term issues facing the industry.

Global Metals Market Overview

Global demand, supply and price forecasts for steel and aluminium, as well as gold, copper and tin, drawing on both our industry expertise and our macroeconomic and financial market team's long-term global demand forecasts and shorter-term market views.

Industry Forecasts

Historic data series and forecasts to end-2018 for all key industry indicators (see list below) supported by explicit assumptions, plus analysis of key downside risks to the main forecast.

Production (`000 tonnes, US$bn), consumption (`000 tonnes, US$bn), exports (`000 tonnes, US$bn); prices (US$/tonne), and growth (%).

Macroeconomic Forecasts

BMI forecasts to end-2018 for headline country macroeconomic indicators, including real GDP growth (%), GDP per capita (US$), population (mn), industrial production index (% y-o-y average) and unemployment (% of labour force).

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Testimonials

'An essential, multi-faceted research tool. BMI’s thorough understanding of the major market players enables an informed – and informative – review of the sector’s actual performance, together with useful insights into current industry issues, which are topped-off with detailed and invaluable forecasts of industry and macroeconomic trends.’

Senior Research Analyst, ABC International Bank plc