Brazil antidumping duties on Chinese steel seen easing pressure on CSN

Brazil’s antidumping measures against Chinese steelmakers could offer relief to Companhia Siderúrgica Nacional (CSN), which is facing one of the worst financial crises in its history.

Founded during the Getúlio Vargas era, the company has been under pressure from investors due to its high debt levels, driven by expansion projects and intensified competition from Chinese steel in the domestic market.

Market analysts say CSN is likely to benefit in the coming months from measures announced by Brazil’s federal government in February targeting Chinese steel producers. At the time, the Ministry of Development, Industry, Trade and Services (MDIC) imposed antidumping duties on steel sold by Chinese companies for a period of five years.

In international trade, dumping occurs when a company exports products at prices below production costs, creating unfair competition in foreign markets. The practice is considered illegal under international trade rules and has been attributed by Brazilian steelmakers to Chinese producers since 2024.

The following overview highlights the monthly inbound volumes of Brazilian steel imports from China between January 2023 and January 2026, according to statistics from Datamar’s DataLiner platform:

Steel Imports from China | Jan 2023 – Jan 2026 | TEUs

Source: DataLiner (click here to request a demo)

Cheap Chinese steel has weighed heavily on Brazil’s domestic market, with imports capturing roughly 30% of local steel sales and reducing the profitability of domestic producers. The impact has been particularly pronounced for CSN. Because the company specializes in higher value-added steel products, freight costs represent a smaller share of competitors’ final prices, intensifying price competition.

“We are facing the challenge of extremely high interest rates and disorderly and unnecessary competition from imported products that greatly undermines potential growth and investment by entrepreneurial companies,” CSN chairman and controlling shareholder Benjamin Steinbruch told investors a month before the government imposed the antidumping measures.

With additional tariffs ranging from $323 to $670 per tonne of Chinese steel imports, CSN could see a short-term improvement in revenue. The company did not respond to requests for comment on the impact of the measures.

“These antidumping measures may provide some relief for the sector as a whole, although there is a risk that the volumes currently coming from China could be replaced by imports from other regions, such as South Korea,” said Daniel Sasson, a commodities analyst at Itaú BBA. South Korea is Brazil’s second-largest exporter of flat steel products — the same segment in which CSN operates.

Heavy debt pressures

By the third quarter of 2025, CSN had net debt of 37.5 billion reais ($7.5 billion), equivalent to 3.14 times its earnings before interest, taxes, depreciation and amortization (EBITDA).

By comparison, rival Brazilian steelmakers Usiminas and Gerdau had leverage ratios of 0.16 and 0.81, respectively.

Adding to the pressure, about 75% of CSN’s debt matures by 2028. Updated figures are expected to be released on March 11, when the company reports its fourth-quarter and full-year 2025 results.

In an effort to reduce debt, CSN announced in January that it plans to divest key assets this year, including its cement business and part of its infrastructure operations, such as port and rail assets in Brazil’s Southeast.

According to Steinbruch, the company is even seeking partners for its core steelmaking business.

CSN’s financial difficulties have already forced the billionaire to reconsider the group’s growth strategy. Over the past five years, the company spent at least 9.7 billion reais acquiring businesses in energy, logistics and cement — deals that analysts say contributed to the company’s high debt burden.

Steinbruch is now seeking buyers for the entire cement division and parts of CSN’s logistics operations, aiming to raise between 15 billion and 18 billion reais.

If successful, the sales could reduce the company’s debt to about 19.5 billion reais, or roughly 1.95 times EBITDA — a level that would be viewed more favorably by major credit rating agencies. Moody’s and Fitch both downgraded CSN’s ratings in recent weeks.

The company is also searching for partners for its steelmaking operations, which, according to a person familiar with the matter, require at least $1 billion in modernization investments.

Late last year, CSN signed an agreement with Brazil’s development bank BNDES to invest 1.13 billion reais in upgrading its main steel plant in Volta Redonda, in Rio de Janeiro state.

Asset sales face hurdles

Despite its infrastructure assets, analysts say CSN may struggle to sell such a diverse portfolio to a single investor, as the company hopes — particularly if the transactions involve minority stakes.

“It may not be so straightforward to find an investor willing to partner with the group and gain exposure to such a wide range of different assets,” said Sasson. “Selling the cement business alone appears to be simpler.”

According to Itaú BBA estimates, a full sale of the cement unit could generate around 10 billion reais.

Industry observers also note that Steinbruch’s reputation for aggressive corporate disputes could complicate negotiations with potential partners. Over the years, he has clashed with companies including Vale, Ternium, Gerdau, Nippon Steel and Sumitomo.

Currently, more than half of CSN’s profits come from mining operations.

Artur Bontempo, an iron ore and steel analyst at Wood Mackenzie, said the company will also need to modernize its iron ore processing operations in the coming years to remain competitive. CSN is also planning to invest 13 billion reais in an expansion project, which could further strain its finances.

“CSN first needs to deal with this expansion before turning to its existing operations and deciding how to maintain them going forward,” Bontempo said.

CSN is the world’s seventh-largest exporter of iron ore and Brazil’s second-largest producer, behind Vale.

Source: Folha de S. Paulo

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