In a meeting with US President Joe Biden, President Jair Bolsonaro demanded that the US review the quotas for Brazilian steel imports, which is one of the main demands of the country’s industry, and expressed the expectation that the issue will move forward as soon as possible. Two Brazilian government sources told Reuters.
Despite no tangible progress, Bolsonaro left the bilateral meeting on Thursday with the US president’s promise that the issue would be analyzed in technical talks between the two countries in the coming months.
“President Biden said he did not have details on the matter at the time, but he would investigate the matter and the matter would be discussed with the technical teams of the two countries as soon as possible,” one of the sources said.
Called Itamaraty did not immediately respond to a request for comment on the matter.
The issue was discussed at the private meeting of the two presidents, in which, in addition to Bolsonaro and Biden, only Brazilian Chancellor Carlos França and US Secretary of State Anthony Blinken were present, in addition to interpreters.
“We have received signs that this issue needs to be addressed. The reality is that Russia is currently benefiting from this surcharge,” the second source said. “The expectation is that this will be resolved quickly.”
IN THIS YEAR
“We expect the quota revision to come out this year,” said Marco Polo de Mello Lopes, president of the Instituto Aço Brasil.
Quotas for imports of Brazilian steel were established in the administration of Donald Trump in 2018, establishing that Brazil has the right to export some of the product without import duties.
At current values, Brazil has the right to export its quota of 3.5 million tons of steel slabs, known as semi-finished products, which is the input for the North American steel industry itself, without surcharges of up to 25%.
In addition to the semi-finished quota, the US has established a quota for products that can be used directly by US industry, such as finished products, coil and plate. In this case, the country calculated an average amount exported by Brazil between 2015-2017 and applied a 30% discount on this amount.
According to Lopes, the Brazilian steel industry was waiting for this first meeting between Bolsonaro and Biden to signal the start of quota negotiations. “A task would be unthinkable if there was stress in the relationship,” the manager said.
“The result of this[meeting between the two presidents]is that we will now set up a new mission to the United States,” Lopes said, not specifying when that might happen.
According to him, the steel trade between Brazil and the United States is approximately $3.6 billion annually, which is 2.6 billion in Brazil’s exports and up to 1 billion in Brazil’s metallurgical coal imports.
Lopes reminded that the Biden administration recently approved an infrastructure investment package of more than $1 trillion and is a supporter of a policy that encourages US consumers to buy products made in the US. Also, Russia, the second-largest slab exporter to the United States, has faced Western sanctions after it started its war against Ukraine this year.
Lopes stated that 85% of the steel exports from Brazil to the USA are made from this material and said, “The North American industry needs Brazilian semi-finished products. This is a strategic raw material for them.”
The largest exporters of semi-finished and finished steel from Brazil to the USA include ArcelorMittal and CSN. When contacted, ArcelorMittal chose not to comment, and CSN did not immediately comment on the matter.
The demand of the Brazilian steel industry remains the same: the withdrawal of semi-finished products from the quota regime for export without additional fees and the end of the discount on finished products so that the volume of these products sold to the USA can be increased.
(Reported by Lisandra Paraguassu in Sao Paulo with additional reporting by Alberto Alerigi Jr, edited by André Romani)
source: Noticias
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