Brazil's steel industry sees rising tensions amid Chinese imports

High steel imports from China are causing tensions among Brazilian industry players.

Local steel companies are demanding the government raise tariffs on Chinese steel from 10.8-12% to 25%, but machinery and equipment producers are opposing such measures because they fear higher input costs.

Folha de S. Paulo newspaper quoted José Velloso, the head of machinery and equipment industry association Abimaq, as saying that steel association Instituto Aço Brasil and individual producers were blackmailing the government.

Steel companies claimed Chinese imports could lead to local production stoppages and the cancelation of planned expansions. 

The government has not yet taken a position, but stepped up protective measures could negatively impact the relationship with China, which is Brazil's main trade partner.