Benjamin Baptista Filho, CEO at ArcelorMittal Brazil, and Harley Scardoelli, CFO at integrated steelmaker Gerdau, shared on Friday how the Brazilian steel industry can and will recover from the Covid-19 pandemic.
The two executives shared their remarks during the Brazilian Steel Association’s IABr web conference. Baptista Filho said the existing crisis actually started a while ago. “The last time the Brazilian steel industry operated at 80 percent its capacity was back in 2013, when we had the most steel consumed domestically. From there on, the steel sector has been deteriorating,” he said.
The CEO of ArcelorMittal Brazil said the industry confidence is gradually recovering. “Despite uncertainties, there should be a gradual and sustainable recovery over the next few years,” he said.
As for conditions for such a sustainable recovery, Baptista Filho said Brazil needs to activate and put in motion all proposed reforms.
“Those include sanitation, with expected investments of BRL 70 billion ($12.9 billion) up to 2023,” the executive said.
Scardoelli said that even amid a scenario of uncertainties, the civil construction segment remained resilient, adding that Gerdau’s view of an agenda for the future includes Brazil’s ability to draw investments in civil construction and infrastructure.
“We need to reduce the state’s size and advance on several agendas, including the tax and the Brazilian government administrative reforms.”
“All countries that are relevant economy-wise have a strong industry. But the industry’s GDP has been declining in Brazil,” Scardoelli noted.
Baptista Filho said other key topics for a sustainable recovery include guaranteeing access to the consuming markets by easing restrictions, such as US Section 232.
“To recover our production capacity to about 80 percent, we’ll need to export. The domestic market won’t be enough,” he said.