Brazil's flat steel orders weaken on local downturn - report

Steel distribution companies in Brazil have reined in orders in June for flat steel products, such as plates for automakers, as the local economy's recent downturn has sapped steel sales, according to market sources cited by daily Valor Econômico.

An unnamed executive from a distribution company told the newspaper that May sales of steel products – including hot and cold rolled, galvanized sheets and heavy plates – may come in below the 375,000t target. In May 2013, the volume sold was 370,000t.

Steel distributors association Inda will release the May sales figures on June 20.

The country's flat steel apparent consumption has been showing signs of a slowdown since April, when it was flat year-on-year, while sales fell 1.6%, the paper said.

Meanwhile, steel imports grew 33% year-on-year to 578,000t in January-April, according to government data cited by Valor Econômico.

Imports are expected to continue increasing on lower international prices, an oversupply in Asia and Eastern Europe, and a favorable exchange rate.