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After good results in the collection of the domestic market in the second quarter of 2022, Usiminas now expects that there will be continuity in the demand for steel in the national territory, although it projects increases in expenses for the coming months.
The steel and industry company Usiminas has positive projections for steel demand in the domestic market over the next few months, since, during the second quarter of the year, the results were quite positive for the company. Despite this, the resumption of operations for production in blast furnace 3 will require an increase in expenses in the next quarter, due to the raw material and other equipment in the structure.
Second quarter of 2022 was very positive for Usiminas and the company expects stability in the domestic market regarding steel demand
In a recent interview about the company's results in recent months, the president of Usiminas, Alberto Ono, highlighted that the year 2022 has been very positive for the company and that the second quarter of the year, in particular, achieved good financial results in sales steel in Brazil. He also highlighted that the company managed to remain resilient in the domestic market, even with the influences of the international scenario.
This is because the war between Ukraine and Russia has been significantly affecting the markets of nations around the world, including Brazil. As a result, there was a strong increase in the values of inputs, production costs and other expenses in the sale of steel in Brazil. However, the second quarter of the year was still very favorable to the company, which now expects the numbers to remain the same over the coming months, projecting stability in the domestic market in terms of product demand.
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The commercial vice-president, Miguel Homes, confirmed that Usiminas' projections regarding demand indicate that steel consumption in Brazil has been assuming a more stable posture in recent months. The vice-president of finance, Thiago Rodrigues, said that the automotive sector is still the company's main problem in the domestic market, due to the volatility of product consumption, but that the industrial segment has been leading to an increase in steel demand, in addition to agribusiness, which has been expanding considerably and bringing good results to the steel company.
Spending on raw materials to resume production at Blast Furnace 3 could affect the company's working capital, even with high demand for steel in the country
Although projections for the domestic market regarding steel demand are quite favourable, not everything remains perfect when it comes to commercialization of raw material and Usiminas now foresees an increase in expenses to resume production in blast furnace 3, since there is a need for investments for this. In addition, Rodrigues was asked about the possibility of Usiminas investing in a galvanized steel line, and he stated that this is not the company's current focus, but that it could happen.
The president of Usiminas, Alberto Ono, highlighted the early redemption of the first series of the 7th issue of debentures, with a value of R$ 700 million and maturity in 2023 and stated that “It was an interesting operation, because it gave us more time and lower costs ”, regarding the results in the Brazilian domestic market. In addition, he confirmed that Usiminas paid BRL 2,1 billion in dividends last year.
In this way, the company will have to observe the increase in production expenses throughout the third quarter of the year, while taking advantage of the high demand for steel in the domestic domestic market to be able to compensate for operating costs that are increasingly high.
