Brazilian government rejects request for zero import tariffs on steel and metal products

The Brazilian government's foreign A588 Grade B steel trade management agency Gecex recently issued a statement rejecting requests from multiple industrial consumer groups and industry associations to reduce import tariffs on various types of metals and steel products for 12 months. This decision was made in response to the demand of steel manufacturers to increase import tariffs on steel products, especially in 2023 and 2024, when the import volume of Chinese steel products reached a new high. In June of this year, the Brazilian government implemented a steel import quota system, which stipulated a 25% import tariff on steel products after the quota was used up. The introduction of this policy is mainly aimed at the rapid growth of steel imports in recent years, especially the influx of Chinese steel, which has brought competitive pressure to Brazil's domestic steel industry.

However, some downstream steel and metal processing enterprises strongly oppose this, believing that further increasing tariffs may exacerbate their production costs, thereby affecting end consumers, especially the supply of some professional products, which may lead to supply and demand shortages in the domestic market.

Specifically, some industry associations A588 Grade B steel have requested zero tariffs. For example, the Brazilian Electronic and Electrical Products Manufacturers Association (ELETROS) has requested a reduction in tariffs on non alloy coated steel products (with a thickness exceeding 600mm) with an annual quota of 7000 tons from 10.8% to zero. The Brazilian Textile and Apparel Industry Association (ABIT) has proposed reducing tariffs on 500 tons of copper alloys and brass profiles to zero.

In addition, Brazilian pipeline manufacturer Cladtek do Brasil Ind e Com de Tubos e Revestimentos Ltda has also requested the government to implement zero tariffs on a quota of 2500 tons of nickel chromium molybdenum alloy plates (thickness of 2mm to 10mm, used for steel pipe lining in the oil and gas industry).

Despite different voices, the Brazilian government insists on protecting the local steel industry in this decision, believing that the increase in import tariffs will help cope with the pressure on steel supply in the domestic market. All parties call on the government to balance the interests of industries while safeguarding the interests of domestic A588 Grade B steel industries, in order to avoid excessive negative impacts on downstream manufacturing and consumers.