Brazil coated steel quota nears limit

Importers filled 79pc of the 293,200 metric tonne (t) coated steel quota in Brazil as of 8 October, the foreign trade secretariat (Secex) said.

Consumption of the three coated products under theimportquota policy accelerated in the first week of October. The activity coincides with the end of the first term in Brazil's renewed quota cycle on 23 October.

Buyers claimed nearly 21,000t of imported coated steel from 1-8 October, up from a 5,000t weekly average from June-October.

Brazil currently has 19 steel products under the quota policy, allowing 497,130t to enter the country under lower tariffs. Once the quota is exhausted, higher import duties apply, jumping from 10pc to 25pc.

The quota regime covers imports for a four-month period, when it resets allowing importers to bring in material under lower duties.

Galvanized and galvalume were the first products to near their quota thresholds, as buyers moved quickly to fill gaps in domestic supply and meet steady demand from the civil construction sector.

Import licenses for smaller consumers were exhausted within the first three weeks of the current term.

Brazil imported 27,900t of quota-covered steel products from 1-8 October. This volume includes bookings and shipments for all 19 steel products covered by the quota regime. Less than 145,000t of the over 353,000t filled by 8 October has cleared customs.

The country introduced the quota system in June 2024 to control rising steel imports. A year later, the government extended the policy through May 2026, adding four new products and reducing volumes eligible for lower tariffs.

Brazil is on track for a new import record in 2025 despite the restrictions. Rolled steel imports will reach 6.3mn t by year-end, an increase of 32pc from 2024, industry chamber Instituto Aço Brasil said.

By Isabel Filgueiras