“Further rises came at the same time as we were passing on previous adjustments to our clients,” a São Paulo-based distributor said.

“New price increases were not expected [for September], but prices in China continued to go up, creating a good opportunity for [Brazilian] mills,” a second source said.

On September 5, CSN was the first to announce an additional price rise of 10.25% for its flat steel products, to be effective from October 1.

This increase was in line with rising flat steel prices in the global market, as well as higher input costs such as high-priced iron ore, the company said at that time.

In mid-September, Usiminas also confirmed that it will raise prices for most of its flat steel goods by 10.20% on October 5, due to higher international prices.

The price rises announced by CSN and Usiminas will apply to hot rolled coil (HRC), cold rolled coil (CRC) and coated steel products.

Brazilian market participants expect that the adjustments scheduled for October will be absorbed by the market.

But the possibility of further rises in local flat steel prices to be applied in the next few months has diminished, as a result of the first signals of weakening prices in China, they added.

On September 26, China’s export prices for HRC fell for the first time in about four months, with the country’s domestic market for the steel product softening through most of the past week.

This recent reduction in Chinese HRC export prices should also affect import prices in South America.

Flat steel import prices in the region have been increasing in line with Chinese values.

Metal Bulletin’s weekly price assessment for HRC imports into South American countries, for instance, was $620-630 per tonne cfr on Friday September 22, up from $590-605 per tonne cfr on September 1.

But HRC prices were stable week-on-week on September 22, as buyers feared corrections.

Flat steel prices have become more volatile over the past week, and buyers fear that a large drop in flat steel import prices could be seen very soon.

South American market participants expect to have a clear view about which direction prices may take after the holiday in China scheduled for the first week of October.