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Brazil Metals Report 2016

Brazil Metals Report 2016

BMI View: Metals production and consumption in Brazil will remain weak due to persistently low metalprices and domestic recession in 2016. However, both metals production and consumption will return togrowth in the years ahead, driven by expansion in the automotive, construction, and infrastructure sectors.

Metals consumption and production will continue to face headwinds, as Brazil's economic recessiondeepens and metal prices only begin to bottom out in 2016. We forecast real GDP to contract by 3.4% in2016 on the back of sluggish private consumption, declining fixed asset investment, and a weak businessenvironment. Moreover, electricity costs remain elevated, raising costs for the energy-intensive metalsindustry. Nevertheless, our longer-term outlook beyond 2016 towards Brazilian economic growth, as wellas key sectors, is more constructive. The automotive, construction, and infrastructure sectors will seeexpansion in the years ahead, driving metals demand and hence production, by the latter half of the decade.

Additionally, we expect refined copper production and consumption to outperform other metals, averaging3.9% and 1.8% annual growth over 2016-2019, bolstered the metal's widespread usage in multiple sectorsand continued investment in productive capacity from Paranapanema, the country's largest producer.


BMI Industry View
SWOT
Metals SWOT
Industry Forecast
Steel: Recession To Hinder Consumption Growth
Consumption Facing Weak 2016
Production Surpluses Ahead
Table: Steel Production & Consumption (Brazil 2012-2019)
Aluminium: Production Growth To Face Significant Challenges
Constrained Production On High Electricity Costs
Demand Fundamentals Stronger Than Supply Outlook
Table: Aluminium Production & Consumption (Brazil 2012-2019)
Copper: Deficit To Persist, Despite Weak Domestic Market
Consumption To Outpace Production
Table: Refined Copper Production, Consumption & Balance (Brazil 2012-2019)
Regulatory Development
Trade & Investment Risk Analysis
Commodities Forecast
Commodities Outlook
Table: BMI Commodities Price Forecasts
Competitive Landscape
Table: Brazil - Financial Data For Key Metals Companies
Company Profile
Vale - Q1 2016
Company Overview
Company Strategy
Latest Results
Table: Vale - Key Financial Data
Company Details
Cia Siderúrgica Nacional
Latest Financial Results
Table: CSN - Key Financial Data
Gerdau
Latest Financial Results
Table: Gerdau - Key Financial Data
Methodology
Cross Checks

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