Ferbasa, one of Brazil's leading ferro-alloy producers, reported a slight decrease in its second-quarter production, coupled with a significant drop in revenues. The company announced on Monday that it produced 74,750 metric tonnes of ferro-alloys in the second quarter of 2024, marking a 0.9% year-on-year decline and a 2.7% decrease from the previous quarter. The production of chromium alloys, which accounted for 50,067 tonnes of the total, fell by 0.3% compared to the same period in 2023.
Additionally, the production of silicon alloys dropped by 2.1% year-on-year to 24,683 tonnes. This decrease in production was mirrored by a sharp decline in revenues, which fell by 17% to 522 million reals ($95 million). The company attributed this revenue drop to lower trading volumes and a 13% decrease in the average dollar-weighted price of ferro-alloys in the first half of 2024 compared to the previous year.
Ferbasa's sales volumes also suffered, with total ferro-alloy sales declining by 6.8% year-on-year to 63,400 tonnes in the second quarter. Domestic sales of chromium alloys plummeted by 21% to 24,770 tonnes, while international sales saw a modest increase of 7% to 16,176 tonnes. Similarly, domestic sales of silicon alloys decreased by 3.1% to 4,788 tonnes, but international sales grew by 7% to 17,682 tonnes.
The company faced additional challenges, including logistical difficulties, such as a shortage of containers and operational restrictions in key shipping routes like the Suez and Panama canals. These factors, combined with decreased demand from Brazil's domestic steel industry and recent protectionist measures in the U.S., have compounded the difficulties faced by Ferbasa.
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