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Brazil Metals Report Q1 2015

Brazil Metals Report Q1 2015

BMI View: Metals production and consumption in Brazil will remain vulnerable heading into 2015 onaccount of persistently high energy costs and weak economic growth. However, accelerating growth in theyears ahead, driven by gains in the automotive, construction, and infrastructure sectors, will underpinexpansion in the metals sector.

Stronger Outlook By Latter Half Of Decade

Metals consumption and production will face headwinds into 2015 on account of modest economic growth(see 'Growth To Disappoint Again In 2015,' November 5). We forecast real GDP growth of just 1.0% in2015 on the back of sluggish private consumption, subdued fixed asset investment, and a weak businessenvironment. Moreover, electricity costs remain elevated, raising costs for the energy-intensive metalsindustry. Nevertheless, our multi-year outlook towards Brazilian economic growth, as well as key sectors, ismore constructive. The automotive, construction, and infrastructure sectors will see expansion in the yearsahead, driving metals demand and hence production, by the latter half of the decade. Additionally, weexpect refined copper production and consumption to outperform other metals on account of the metal'swidespread usage in multiple sectors and continued investment in productive capacity fromParanapanema, the country's largest producer.


BMI Industry View
Stronger Outlook By Latter Half Of Decade
SWOT
Metals SWOT
Industry Forecast
Steel: Weak 2015 To Give Way To Stronger Growth
Consumption Facing Weak 2015
Production Surpluses Ahead
Table: Steel Production & Consumption (Brazil 2010-2018)
Table: Steel Industry Historical Data (Brazil 2005-2013)
Aluminium: Demand To Outpace Production
Constrained Production On High Electricity Costs
Demand Fundamentals Stronger Than Supply Outlook
Table: Aluminium Production & Consumption (Brazil 2010-2018)
Copper: Growth To Come Following Weak 2014
Consumption To Outpace Production
Table: Refined Copper Production, Consumption & Balance (Brazil 2010-2018)
Regulatory Development
Tax Regime
Government Steadily Tackling Persistent Corruption
Table: Brazil - Political Overview
Commodities Forecast
Table: BMI Steel Price Forecast
Short-Term Outlook (three-to-six months)
Long-Term Outlook
Production Growth Set For Slowdown
Consumption Growth To Disappoint
Downside Risks To Price Outlook
Table: Steel Data & Forecasts
Commodity Strategy
Ferrous Metals
Non-Ferrous Metals
Aluminium: Ending 2014 On A Whimper
Copper: More Weakness Ahead
Nickel: Modest Rebound To Be Limited By Ample Supply
Zinc: Sideways Trading On Diverging Supply & Demand Dynamics
Table: Select Commodities - Performance & BMI Forecasts
Competitive Landscape
Table: Financial Data For Key Metals Firms Listed In Brazil
Energy Costs Top Headwind
Company Profile
Gerdau
Latest Financial Results
Table: Gerdau - Key Financial Data
Cia Siderúrgica Nacional
Latest Financial Results
Table: CSN - Key Financial Data
Global Company Strategy - Vale - Q1 2015
Company Overview
Company Strategy
Latest Results
Table: Vale - Supply Chain Analysis
Table: Vale - Key Financial Data
Company Details
Methodology
Cross Checks

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