Bekaert expects Brazil rubber downturn to continue 

Brussels – Steel products group Bekaert does not see potential for recovery at its Rubber Reinforcement business in Covid-hit Brazil during the second half of 2020, CFO Taoufiq Boussaid told analysts in a first-half results call.
 
This follows a sharp slowdown in demand for its products there in the first six months of 2020, with some analysts reporting second-quarter volumes tracking 60% lower than in the same period a year ago. 
 
Assessing the impact of the pandemic on its Rubber Reinforcement unit in Brazil, Boussaid said order activity was impacted particularly by Covid-related stoppages in the construction sector – a major user of off-road tires and materials-handling equipment.
 
“Unfortunately, as it stands now, for the second half, we don't see a major improvement or stabilisation coming out of Brazil,” the CFO added on the 1 Aug  call from Bekaert’s Brussels HQ.
 
Bekaert operates three plants in Brazil through a 55.5%-owned joint venture with ArcelorMittal, called Belgo Mineira Bekaert Artefatos de Arame Ltda (BMB).
 
In 2018, BMB launched a three-year expansion plan in a bid to gain current market-share in the region. Projects included a $33-million investment at its Itaúna plant in Minas Gerais, increasing steel tire cord capacity by 35%.