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Brazil's Trade and Industry Minister Miguel Jorge said Tuesday he "doesn't rule out" the possibility of zeroing Brazilian steel import tariffs in a move to dissuade the country's steelmakers from pushing up product prices.
The government has been studying the measure for several weeks, as a way to combat rising inflationary pressures in Brazil, but hasn't yet reached a decision, a ministry spokesman cited Jorge as telling reporters in Brasilia.
So far it hasn't been necessary to implement the measure, which continues to be assessed, Jorge said.
Last week two Brazilian steelmakers, Companhia Siderurgica Nacional (SID, CSNA3 BR), and the Tubarao mill of ArcelorMittal (MT, MT.AE), notified customers of plans to increase steel prices by as much as 10%.
The steel prices come in the wake of announcements that prices for iron ore, the steelmakers' main raw material, will increase by up to 35% on international markets.
Brazilian steel sold on the domestic market can reach prices as much as 40% above international levels, according to key industry analysts.
Steel imports into Brazil surged to 1.8 million metric tons in January-April 2010, up 156% from the same 2009 period, due to cheap international prices and the strengthening of the Brazilian real, according to Brazil's Steel Institute, known as IABr.
Brazil's steel import tariffs stand at around 12% for flat products which use iron ore as a main raw material.
At 5.3%, Brazilian consumer inflation is outstripping the government's 4.5% target for 2010.
-By Diana Kinch, Dow Jones Newswires; 55-21-2586-6086; email@example.com