Brazil Opts Against Provisional Duties on Chinese Hot-Rolled Coil Despite Dumping Evidence

Investigation Uncovers Significant Dumping Margins

Brazil's Secretariat of Foreign Trade (Secex) has confirmed that Chinese hot-rolled coil (HRC) suppliers engaged in dumping practices, selling products at prices below market value in the Brazilian market. This determination followed an extensive investigation that concluded with findings announced on December 24, 2025. The probe revealed substantial dumping margins, with preliminary calculations assigning Baosteel a margin of 46% and Hebei Yanshan a margin of 51%. These figures indicate a significant price disparity that has negatively impacted Brazil's domestic steel industry.

Impact on Brazilian Steelmakers and Surging Imports

The influx of underpriced Chinese HRC has exerted considerable pressure on Brazilian steelmakers, including major players like Gerdau, Usiminas, and CSN. Secex noted that these dumping practices have undercut domestic prices, squeezed profit margins, and weakened the financial indicators of local producers. Domestic HRC prices have reportedly fallen by 11% year-to-date.

The investigation also highlighted a dramatic increase in Chinese HRC imports into Brazil. Shipments surged by approximately 26 times between the 2019-2020 and 2023-2024 periods, representing a staggering 2,636% increase in import volumes. As of November year-to-date, Brazil imported 678,619 metric tons of HRC, with Chinese steel accounting for 452,900 metric tons of that total.

Decision to Withhold Provisional Duties and Extended Timeline

Despite the clear evidence of dumping and the demonstrated injury to the domestic industry, Brazil has opted not to impose provisional anti-dumping duties at this stage. The decision allows for further investigation into the matter. The final determination regarding permanent duties is now expected by July 20, 2026, though this deadline could be extended until December 2026 due to an 18-month extension granted to the investigation.

This is not the first instance of Brazil initiating and then delaying or suspending anti-dumping measures on Chinese steel. Previous investigations have seen duties imposed and subsequently suspended on 'public interest grounds' or due to 'unstable situations on the world steel market.'

Broader Context of Trade Investigations

The HRC investigation is part of a broader series of trade defense measures Brazil is undertaking. Secex is also conducting investigations into other Chinese steel products, including cold-rolled coils (CRC), pre-painted, and coated steel, with conclusions for these cases anticipated by March.