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Gerdau update on Brazil Business Division

Steel News - Published on Thu, 16 May 2019

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Gerdau Brazil Business Division includes the operations in Brazil (except special steel) and the iron ore operation in Brazil. It’s crude steel production decreased in 1Q19 compared to 1Q18, due to the lower shipments in the period. Shipments decreased in 1Q19 in relation to 1Q18, due to lower shipments of semi-finished products in the domestic market, especially of slabs. Another factor was the reduction in shipments to export markets of semi-finished products, especially billets, given the export market’s lower profitability and the building of a strategic inventory to prepare the Ouro Branco Mill for its scheduled maintenance shutdown in the second half of 2019.

In relation to 4Q18, shipments increased, reflecting the higher sales of long steel products. The better performance in the domestic market was influenced primarily by the retail construction market. The reduction in exports of flat steel products in 1Q19 compared to 4Q18 is explained by the rebuilding of slab inventories to meet the needs of the flat steel rolling mills at the Ouro Branco Mill during the scheduled maintenance shutdown of blast furnace 1.

In 1Q19, 256,000 tonnes of iron ore were sold to third parties and 1.196,000 tonnes were consumed internally. The lower shipments of iron ore in the period reflect the building of strategic inventories given the challenges faced by the mining industry in Minas Gerais state.

Net sales increased in 1Q19 compared to 1Q18, due to the increase in net sales per tonne sold, especially in the domestic mar ket. Compared to 4Q18, the decrease in net sales was mainly due to the reduction in net sales per tonne sold in the export market, influenced by the international prices formed during the last three months of 2018, given that export prices are set on average three months prior to shipment.

Production of crude steel1,4191,532-7.4%1,454-2.4%
Shipments of steel1,3571,438-5.6%1,3113.5%
Domestic Market939996-5.7%8875.9%
Shipments of long steel1,0411,071-2.8%92113.0%
Domestic Market641647-0.9%5898.8%
Shipments of flat steel316367-13.9%390-18.9%
Domestic Market298349-14.6%2980.0%

In ‘000 tonnes

Source :

Posted By : Rabi Wangkhem on Thu, 16 May 2019
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