Rising Steel Imports Spark Industry Concern

Brazil has recorded a significant increase in steel imports, with volumes rising by 27.5% year-on-year in April 2025, reaching 2.2 million metric tons. These figures, released by Instituto Aço Brasil, highlight the growing demand for foreign steel in the face of stagnant domestic production. The surge in imports is largely driven by lower global prices and supply chain shifts favoring external sourcing.

Industry stakeholders warn that this growing reliance on imports could undermine the country’s domestic steel sector, already struggling with overcapacity, high energy costs, also, logistical challenges.

Domestic Output Slips Slightly

In stark contrast to the import surge, Brazil’s crude steel production experienced a marginal decline of 0.3% during the January–April 2025 period compared to the same timeframe in 2024. Total output reached 11 million metric tons, indicating a stagnation rather than collapse.

Despite several capacity-enhancing projects underway in the southern and southeastern regions, domestic mills are grappling with weak demand from the construction and automotive sectors. This stagnation has led to rising inventory levels and reduced profitability for many local producers.

Imported Steel Gains Competitive Edge

The sharp increase in imports is partially attributed to the price advantage offered by international suppliers, particularly from China, Russia, also, Turkey. These countries have flooded the market with cheaper semi-finished and flat-rolled steel products, often priced below domestic equivalents by 15% to 20%.

Such price discrepancies are challenging Brazilian producers to stay competitive, forcing some to scale down operations or delay planned expansions. Local industry voices have renewed calls for anti-dumping measures and stricter import controls to shield national output.

Government Monitoring Market Trends

In response to the growing concern, Brazil’s Ministry of Development, Industry and Trade, MDIC, has announced a review of recent steel import patterns. Officials are also considering revisions to import duties and regulatory frameworks to protect strategic manufacturing sectors.

While trade liberalization has enabled cheaper raw materials for downstream industries, the potential damage to upstream producers is prompting a policy rethink. The government is under pressure to balance open market policies with domestic industrial resilience.

Demand-Supply Imbalance Widens

Experts believe that Brazil’s internal steel demand has not kept pace with global recovery trends. Although sectors like agribusiness and machinery have shown growth, key steel-consuming industries such as real estate development, automotive manufacturing, also, infrastructure remain subdued.

This has created an imbalance, where domestic mills produce at or below capacity while foreign steel, often subsidized, enters the country in bulk. If this trend persists, Brazil could face a structural dependence on imports, weakening long-term industrial autonomy.

Environmental & Sustainability Challenges

Brazilian steelmakers are also struggling to compete on environmental metrics. Imported steel, though cheaper, often comes from plants with higher CO₂ emissions. Local producers following more stringent environmental standards argue that the regulatory burden is hurting their price competitiveness.

This challenge is pushing local firms to lobby for carbon border adjustments or green certification schemes that favor low-emission domestic steel. Without such mechanisms, eco-compliant producers risk being priced out of the market.

Industry Calls for Immediate Safeguards

Instituto Aço Brasil, backed by several steel associations and labor unions, has submitted a formal request to the government for emergency safeguard measures. These include temporary import quotas, minimum price thresholds, also, financial aid for struggling mills.

They argue that without swift intervention, the national steel sector, one of Brazil’s most strategic and job-intensive industries, could face closures, layoffs, also, long-term erosion of manufacturing capacity.

Outlook for Remainder of 2025

Analysts predict continued volatility in the steel sector through the second half of 2025. If global prices remain low and local demand does not rebound, Brazil’s import dependence may intensify. However, any introduction of protective tariffs or government incentives could temper this trend.

Stakeholders are closely watching for policy signals in the upcoming quarterly economic review, where trade-related measures are expected to take center stage.

Key Takeaways

• Brazil’s steel imports rose by 27.5% in April 2025 year-on-year, reaching 2.2 million metric tons.

• Domestic crude steel production dropped by 0.3%, totaling 11 million metric tons in the first four months of 2025.

• Steelmakers urge the government to impose safeguards against low-cost imports and support eco-friendly domestic production.