The company's CEO Gustavo Werneck stated that the company's vision is to reduce costs, not increase prices. The market expects Gerdau to make progress on its cost-cutting plan this year and reap the benefits of this strategy in the next fiscal year.
Gustavo Werneck also referred to last month's introduction of a quota for imported steel and a 25% tax on the surplus. He expects more from the government as the Foreign Trade Secretariat under the Ministry of Development has already approved a trade defense measure and an antidumping trade defense measure for some products.
Gerdau is under pressure due to the growing presence of Chinese steel in the market. The company's commercial policy, its negotiations with customers in the construction and automotive sectors, and its price quotations for Chinese steel have come under scrutiny. Gerdau's shares have fallen by 25% in a year, while its chairman Werneck believes it is impossible to compete with subsidized steel.
The company operates in seven countries, including the US, Canada, Mexico, Argentina, Uruguay, Peru and Brazil. The 12% rise in the commercial dollar against the real in the second quarter affected Gerdau, which operates in seven countries. The executive believes that the American currency is important in decision-making but not in the long-term vision.
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