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Interview: Otacilio Peçanha, Director, Negotiare Consultores

Octalio shares his views on the current state of the Brazilian steel industry and the factors affecting it as well as where the Brazilian Steel Mills source their coking coal and anthracite.


Coaltrans Conferences (CC): How strong is the Brazilian steel industry these days? 

Otacilio Peçanha (OP): Coal-based steel industry in Brazil faces tough competition with foreign steel, especially Chinese. National currency (Real) appreciation is another issue that the industry has to take into consideration.

Consolidation in the coal-based steel industry in Brazil has not happened to a reasonable degree yet and the six existing coal-based steel companies must work hard on cost reduction and strategic alliances to face those challenges.

Finding the right time to compete or to cooperate is essential to survive in a highly competitive environment. Staying alone is not a reasonable choice for the Brazilian Steel Mills (BSM).

(CC): Where does coking coal used by the BSM come from? 

(OP): Australia is the main supplier of met coal, followed by the US. These two countries supply around 80% of the total met coal imports.

Canada has become less important and Mozambique is the newcomer. Russia and Australia are the main suppliers of PCI coal. 

Coke is also imported – 1.0 to 1.5 Mt/year – and it comes from China and Colombia.

(CC): What about imported anthracite in Brazil?

(OP): The big importer is Vale that uses it in its pelletizing plants, being responsible for around 60% of total imports (1.0 Mt/y). South Africa is the main origin.

The coal-based steel industry uses anthracite in the sintering plants, in those cases that coke breeze is not available.

Coke importers make use of the coke breeze generated when handling the imported coke and do not need to import anthracite.

This content is provided by Coaltrans Conferences for informational purposes only, and it reflects the market and industry conditions and presenter’s opinions and affiliations available at the time of the presentation.