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CSP decides to maintain steel production, seeking new markets

Companhia Siderúrgica do Pecém (CSP) will keep its steel production in operation, but will seek new markets to spawn production amid the drop in demand for the alloy in Brazil and in the world due to the new coronavirus pandemic.

The company is the newest steelmaker in the country, and the first integrated steel production project in the Northeast, located in the Pecém port complex, in Ceará, started production in 2016 and has a capacity for 3 million tons of slabs per year.

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“The continuity of CSP's operation is essential to society, because it maintains the generation of electricity for the National Interconnected System (SIN) and oxygen for hospitals and other gases for essential industries, such as food. In this way, production at CSP will continue,” the steelmaker said in response to inquiries from Reuters.

The company cited a decree issued by the governor of Ceará, Camilo Santana, authorizing companies with blast furnaces or companies operating in the Ceará Export Processing Zone (ZPE-CE), in Pecém, to continue operating.

CSP stated that so far, CSP's operation this year has followed the 2020 plan. without informing comparison with the same period last year.

CSP is a joint venture formed by Vale (VALE3) (50% stake), and the South Koreans Dongkuk (30%), the world's largest buyer of steel slabs, and Posco (20%).

However, starting this month, CSP stated that it will “seek new markets and customers, to maintain sales at levels sufficient to maintain the active operation, preserving jobs”.

Several steelmakers in the country have already made big announcements of reduced production in recent days, after demand for steel in the country plummeted. On Friday, Gerdau said it will reduce activities in the Americas, in cuts that include shutdown of the blast furnace at the Ouro Branco mill (MG).

In addition, Usiminas (USIM5) and ArcelorMittal Brasil also announced similar adjustments to the smothering of furnaces, one of the most radical measures to be taken by companies in the steel sector to face moments of crisis.


Source: Reuters