Brazil Steelmakers Raising Domestic Prices By 5%-8% - Distributor

RIO DE JANEIRO--Steelmakers Usinas Siderurgicas de Minas Gerais SA (USIM5.BR), or Usiminas, and ArcelorMittal Brasil are raising their product prices by 5% to 8%, a steel distributor who purchases from the companies said late Wednesday.

The increases are being charged on flat steel products sold to the domestic market, said Christiano da Cunha Freire of Sao Paulo-based distributor Frefer Metal Plus - Klockner & Co.

Companhia Siderurgica Nacional SA (SID, CSNA3.BR), or CSN, hasn't yet announced any price increase, according to the distributor.

A spokesman for CSN said he couldn't yet confirm any price hike when asked Wednesday by Dow Jones Newswires.

A spokesman for Usiminas said the company doesn't comment on its pricing policy.

Barclays Capital said in a research note earlier Wednesday that the Brazilian real's recent depreciation against the dollar, coupled with easing steel imports, may favor local steel price increases. However, higher prices are risky for steelmakers as domestic steel demand remains sluggish--including in the auto sector--global pricing is moving sideways, and local competition is rising, Barclays said.

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