1. Overview of Brazil

The Federative Republic of Brazil (Portuguese: República Federativa do Brasil) is the largest country in Latin America. The capital is Brasilia. Portuguese is the official language. The total land area is 8.5104 million square kilometers and the population is 203 million.

Brazil ranks first in Latin America and tenth in the world (2024). With developed agriculture and animal husbandry, it is the main producer and exporter of a variety of agricultural products. The output value of the service industry accounts for nearly 60% of the GDP, and the financial industry is relatively developed. Brazil has a relatively complete industrial system and a strong industrial foundation. The industries such as steel, automobiles, shipbuilding, petroleum, chemicals, electricity, and shoemaking are relatively developed, and the civil regional aircraft manufacturing and biofuel industries are at the world's leading level. The GDP in 2024 will reach 11.7 trillion reais (about 2 trillion US dollars).

Brazil's 29 mineral reserves include niobium, manganese, titanium, bauxite, lead, tin, iron, and uranium. Niobium ore reserves have been proven to be 4.559 million tons, and the output accounts for more than 90% of the world's total output. It has proven iron ore reserves of 33.3 billion tons, accounting for 9.8% of the world, ranking fifth in the world and second in the world in production. The proven oil reserves are 15.3 billion barrels, ranking 15th in the world and second in South America (second only to Venezuela). Since the end of 2007, multiple extra-large subsalt oil and gas fields have been discovered along the coast, with expected reserves of 50 billion to 150 billion barrels, and are expected to enter the top ten oil storage countries in the world.

2. Overview of Brazilian steel

Brazil is the ninth largest steel producer in the world and the largest steel producer in Latin America. It occupies an important position in the global steel industry. It has proven iron ore reserves of 33.3 billion tons, accounting for 9.8% of the world, ranking fifth in the world and second in the world in production. The crude steel output will be 34.1 million tons in 2022, the crude steel output will be 31.8 million tons in 2023, and the crude steel output will be 33.8 million tons in 2024.

Voltaretonda is an important steel industrial city in the state of Rio de Janeiro, Brazil, located at the bend of the South Paraiba River. The city developed rapidly due to the establishment of a state-owned steel plant in 1941, and has been expanded many times to become the largest steel production base in Latin America. Its industrial development benefited from its geographical advantages in its proximity to mineral resources and the two major consumer markets, forming a steel industry cluster with Brazilian Iron and Steel Corporation (CSN) as its core. Achieve annual crude steel production capacity of more than 6 million tons and rolled product production capacity of 6 million tons. It adopts multi-furnace continuous ingot technology, and its products cover slabs, hot-rolled coils, cold-rolled sheets, etc., and are used in the fields of automobile manufacturing and construction engineering. It has iron ore self-mining capacity and port transportation system to form a complete mining-smelting-processing-logistics industry chain.

Brazil's annual steel imports are more than 5 million tons and its annual exports are about 11 million tons. Brazil's domestic steel sales are about 20 million tons. The United States has always been the main destination for Brazil's pig iron and steel exports, accounting for about 40% of the exports to the United States. China is currently Brazil's largest steel importer. In the first quarter of 2025, Brazil imported 1.096 million tons of steel products from China, and the steel products imported from China are expected to exceed 3 million tons of annually.

Brazil's per capita steel consumption has stagnated in recent years and is at a low level of international standards, with 110 kg in 2024. In 2024, the global per capita consumption of finished steel is 214.7 kg.

3. Market size and demand of Brazilian steel

The size of Brazil's steel market will reach US$16.56 billion in 2024. CAGR predicts that the annual growth rate will be around 4% from 2025 to 2033, and the market is expected to reach US$24.85 billion by 2033. During the period 2025-2033. High domestic demand in important industries such as infrastructure, automobiles and construction is one of the market drivers that drive expansion. In addition, substantial investment in green steel manufacturing and technology is promoting greener practices, which helps actively expand Brazil's steel market share.

One of the main factors driving Brazil’s steel market is the rapid growth of the country’s construction and infrastructure sectors. With the acceleration of urbanization, steel is widely used in the construction of residential, commercial and industrial buildings. In addition, the construction of roads, bridges and public transportation systems has also strengthened this need. Brazil's steel industry is expected to be the main engine of economic growth in the country as the government attaches great importance to large infrastructure projects. This trend supports the growing demand for steel products such as steel bars, steel plates and structural steel, making Brazil one of the largest steel markets in Latin America. For example, in March 2025, ArcelorMittal acquired the remaining 60% stake in Brazilian pipeline manufacturer Tuper and acquired full ownership. Tuper produces welded steel pipes, structural steel and galvanized steel with an annual production capacity of 826,000 tons. The acquisition strengthens ArcelorMittal's position in the Brazilian steel industry.

4. Major steel enterprises in Brazil

(1) Gerdau SA

Gerdau SA is Brazil's main long material manufacturer, ranking 12th in the world. The group has five major business departments, including: North America (including the United States and Canada), Brazilian Long Materials Branch, Brazilian Acominas Ouro Branco Branch, and Special Steel Branch (including Brazil and Spain).

In addition to establishing factories in Brazil such as Recife, Saint José-Campus, Saint José dos Campos, Rio Grande, etc., the Brazilian Gaeldao Group also set up factories in many South American countries such as Chile, Bolivia, Argentina, Uruguay, and Colombia.

Galdot Group controls 30% of Brazil's steel production capacity. The company mainly uses scrap and pig iron during the electric furnace production process to produce ordinary long steel, special steel and flat steel. Most of these scrap and pig iron are purchased from each factory's operating area (equivalent to small rolling mills) and also produce steel from iron ore (through blast furnaces and direct reduction). These products are mainly used in civil construction, industrial, automotive and agricultural sectors.

Website: //www.gerdau.com.br

(2) Usiminas Iron and Steel Company (Usiminas)

In addition to producing steel, the company also provides various solutions for the Brazilian industry involving the use of steel structures and steel. The company can provide a series of solutions for automobiles, ships, oil drilling platforms, tractors, industrial machinery, home appliances (such as refrigeration and stoves, etc.). The company is the largest local steel joint venture in South America.

The company currently has two large steel plants: one is located in Ipachenga, Minas State, and the other is located in Cuba pond in São Paulo State, with products mainly rolled plates. In addition, it has established a joint venture with Nippon Railway Corporation Unigal Usiminas to produce galvanized steel and other new steel varieties; Mineração Usiminas, the company's mining company, mines iron ore in Minas; Soluções Usiminas, a metal solution company under its jurisdiction, can provide a variety of metal distribution and processing solutions; and subsidiaries can provide a variety of capital products, technologies and service management.

Website: //www.usiminas.com.br

(3) Brazilian Iron and Steel Company (CSN-Companhia Siderúrgica Nacional)

Brazilian State Steel Company, Brazilian state-owned enterprise, the second largest steel manufacturer. National Steel Company has the largest complete steel production system in Brazil and is also one of the largest crude steel production plants in South America. National Steel Corporation accounts for 49% of galvanized steel and 98% of tin rolled products sold in Brazil, and is also one of the world's important tin rolled products manufacturers.

(4) ThyssenkrupCSA

ThyssenKrupp CSA Siderurgica do Atlantico invested US$8.2 billion in Rio de Janeiro to build the largest steel company in Brazil. Its largest single investment in the Brazilian steel industry was completed in 2010 and employs more than 30,000 employees. ThyssenKrupp Steel accounts for 73.13% of the shares and Vale accounts for 26.87% (a 15-year contract with ThyssenKrupp to supply iron ore to steel mills).

(5) Aperam

It is engaged in the production and operation of stainless steel, silicon steel and special steel, and has three departments: stainless steel and silicon steel section, service and solution section, alloy and special product section. Aperam has a production capacity of 2.5 million tons of stainless steel flat materials in Europe and Brazil. Its production is mainly concentrated in six factories in Brazil, Belgium and France, with about 9,800 employees, accounting for 25% of Europe and 65% of South America's market share.

Website: //www.aperam.com

(6) Arcelor Mittal Group (Brazil name ArcelorMittalTubarão Grupo)

The Arcelor Mittal Group is a global iron ore production and steel production enterprise, conducting business in more than 60 countries around the world, with employees up to 230,000. The steel products provided are used in the construction, home appliance manufacturing, packaging, and automobile industries. The products include various types of wire, plates, steel billets and corresponding derivative products, and also provide solutions for various steel structure needs. The crude steel production capacity in Brazil is 11 million tons and employs 11,000 people.

Website: //brasil.arcelormittal.com.br/

(7) Vorantinim Group (Vorantinim)

The Wotolanting Group is a steel company, mainly producing steel plates, bars, wires and mesh profiles. Its domestic market sales brand is Voraço. Its production capacity is 1.02 million tons of long materials and 550,000 tons of various finished materials.

Website: www.vsiderurgia.com.br

5. Advantages and shortcomings of Brazil's steel industry

(1) Advantages

With its resource advantages, Brazil has become one of the countries with the lowest production costs of steel. Brazil is dependent on iron ore and cheap labor and faces challenges in environmental protection and sustainable development. Brazil's steel industry benefits from strong market demand, especially the huge demand for infrastructure construction.

The industrial foundation of the southeast coastal areas is good, and cities such as Sao Paulo gather traditional industries such as steel and automobiles; the shipping conditions are superior, and the import and export logistics efficiency is high.‌; Hydraulic resources are fully developed.

As a member of the "BRICS Five", Brazil's steel companies have good profitability, attracting many international steel giants to come and invest. Especially between 2010 and 2015, the increase in global steel demand further boosted the growth of Brazil's steel production. However, the future development of Brazil's steel industry will face greater pressure on environmental protection standards and sustainable development. How to protect the environment while developing the economy will become a key issue that Brazil's steel industry needs to consider.

(2) Insufficient

The proportion of industry in GDP dropped from 36% in 1985 to 21% in 2023, with serious loss of manufacturing jobs; excessive dependence on commodity exports (minerals and agricultural products accounted for 68% of exports in 2023), and weak economic risk resistance; the level of automation in the manufacturing industry (robot density 15 units per 10,000 people), lower than the global average; industrial electricity prices and logistics costs are 40% and 60% higher than that in China, weakening international competitiveness.

6. Brazil strengthens protection of local steel industry

On July 27, 2025, the Brazilian Foreign Trade Commission (Camex) officially approved the extension of the steel import quota measures for 12 months, and significantly expanded the types of restricted products from 19 to 23. This policy adjustment continues Brazil's domestic steel industry protection strategy since 2024. Imports within the quota will still apply a tax rate of 9%-16%, but the part beyond the quota will face a high tariff of 25%. Anti-dumping measures are currently implemented on 26 steel products from 13 countries: including China, India, Germany, Russia, Malaysia, Taiwan, Romania, Ukraine, South Africa, Vietnam, Thailand, Indonesia and South Korea.

In order to stimulate industrial activities and the development of the steel industry, the Brazilian government has implemented a series of measures such as accelerating depreciation plan, a green mobility and innovation (Mover) plan, encouraging the issuance of bonds and the development of letters of credit. At the same time, in order to attract foreign investment, the government has also implemented new accelerated growth plans (PAC) and tax reforms to reduce bureaucracy and lower interest rates for innovative projects to enhance the industry's international competitiveness.

Looking around the world, Brazil is not the only country to tighten its steel import policy. In recent years, major economies such as the United States, the European Union, and India have strengthened their steel trade defense measures. This chain reaction indicates that international steel trade may enter a new round of rule reconstruction period. As the largest economy in Latin America, Brazil's policy direction is of the weather vane to the regional trade pattern.

As the wave of protectionism swept the world, international trade in steel, the "industrial food", is becoming increasingly politicized. Brazil's decision to extend and expand the quota system is not only an escort to domestic industries, but also a response to the changing global trade order.

7. Capacity expansion and technology upgrade

In May 2024, Brazil plans to invest 100 billion Brazilian real in the next five years to expand Brazil's steel production capacity, modernize and upgrade, establish new factories, and adopt advanced technologies to improve production efficiency and product quality. Major milestones are expected to be achieved by 2028. Some of the investment will focus on sustainable development and focus on greener technologies to minimize environmental impacts, including reducing carbon emissions and strengthening waste management.

Sustainability is also a major trend supporting the growth of Brazil's steel market, especially as the global push for green steel. The Brazilian steel industry is driving the growth of the Brazilian steel market by adopting more sustainable processes, moving towards reducing carbon emissions. Steel producers are gradually turning to electric arc furnaces (EAF) and direct reduction iron (DRI) technologies that consume less energy and emit less greenhouse gases than traditional blast furnace processes. With the encouragement and investment support of the government, the use of green hydrogen as a reducing agent is also becoming increasingly prominent in Brazil. As Brazil strives to achieve global decarbonization goals, the growth of green steel manufacturing is expected to improve Brazil's competitiveness in the international steel market.

8. Brazil's industrial development momentum is good

Brazil's total trade volume was US$599.5 billion in 2024, an increase of 3.3% year-on-year, the second highest since record in 1989. The "World Economic Situation and Outlook" recently released by the United Nations believes that Brazil's economy will maintain elastic growth and further stimulate the economic vitality of Latin America and the Caribbean.

In 2024, Brazil's manufacturing exports were US$181.9 billion, a year-on-year increase of 2.7%, hitting a new high since 1997. In 2024, Brazil's industrial output value increased by 3.1% year-on-year, and manufacturing output value increased by 3.7%. Among them, the aviation manufacturing industry performed well. Embraer delivered a total of 206 aircraft in 2024, an increase of 14% year-on-year.

The Brazilian government launched a new round of economic growth acceleration plan in 2024, involving projects such as highways, schools, housing, medical facilities, etc., with a total investment of approximately 55 billion reais. Large-scale infrastructure construction not only drives employment, but also provides more opportunities for foreign capital.

The “Brazil’s New Industry” plan is rewriting the economic script. Through special financing of 300 billion reais and tax incentives, the government has leveraged public and private investment of 3.4 trillion reais, covering six major areas including agricultural technology, national defense industry, and digital transformation.

The International Monetary Fund said that Brazil's economy has become more resilient in the past few years. In the medium term, tax reform, oil and gas production and green investment will further unleash Brazil's economic growth potential. International rating agency Moody's upgraded Brazil's public debt rating from Ba2 to Ba1 in October 2024, with a rating outlook of "positive". Brazilian President Lula also said on social media that he strives to make Brazil the sixth largest economy in the world by 2027.

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