The usual meeting between owners and directors of the flat steel’s value chain in Argentina was held online. The event was attended by 250 people, including industrialists and representatives of our commercial network. The analysts Andrés Malamud and Claudio Zuchovicki shared their insights on politics and economy from a global and local perspective; while Martín Berardi, Executive President of Ternium Argentina, ran through the current situation from the perspective of the steel industry, and shared his vision alongside the representatives of different areas.
33rd ProPymes Meeting: more than 250 people participated in the online event.
Martín Berardi, Executive President of Ternium, started his presentation with the current situation related to Covid-19 and included an analysis of the global market situation, which shows a general rise in prices due to strong global demand for raw materials and finished goods, and an expansionary monetary policy that foresees international inflation. Moreover, while developed countries feel optimistic about 2021 –coming back to normality in some cases–, developing countries are expected to start recovering by 2022.
For Berardi, another fact that is changing the future of global transactions is the analysis of the regionalization of logistics chains: “The pandemic showed the weakness of global supply chains and developed countries are now analyzing whether they can switch from global supply to regional supply, which would be a development opportunity for Latin America”, he assured.
Regarding the local situation of the steel industry, Berardi claims that the steel demand has stabilized in Argentina: “In regard to the construction industry, the stockpiling of the last quarter of 2020 is no longer seen. Both the agribusiness sector and the packaging industry continue stable, in good order. The white goods market rebuilt its supply chains, leveling the final demand, while the automotive industry is being affected by the provision of inputs and by Covid-19 outbreaks in its plants”, the Executive President noted.
To put Argentina in a political context with respect to the region and the world, Andrés Malamud (Ph.D. Political and Social Sciences) was invited, as he claims that Latin America is living a triple process of inequality, criminality and political fragmentation. Although inequality has been reduced by more than half in the last two decades, it has remained the same in the last few years along with the dissatisfaction of the population. This causes unequal societies with high informality and crime rates to create fragmented, hard-to-manage democracies with multiple political parties. In Argentina, contrary to popular belief, Malamud reassured that the country is advancing in the opposite direction to its Latin American peers: “Argentina is the country with the lowest inequality in Latin America, after Uruguay, and the lowest violence rate, after Chile. On top of that, it is possibly the least fragmented country in Latin America. Argentina’s government is super stable. The problem is the economy, the inflation, being out of the market and the lack of credit,” he stated. For the analyst, there is a risk and an opportunity: “What is happening in the rest of the region can be a depiction of our future, but it is not our present. Today, we still have the opportunity to do the right thing.”
On the other hand, Claudio Zuchovicki, a specialist in finances and the capital market, proposed an economic scenery at a global level along with some projections at a local level. For the economist, Argentina is a country with gaps that do not allow us to think in the long term: exchange rate, inflation, financing, employment, and asset value gaps. According to Zuchovicki, the next four months might be the hardest ones of the next four years: “We haven’t seen the worst in the exchange rate because there is going to be a monetary issue in order to pay the fiscal deficit. The inflation is going to be higher and the market will remain as a backup for values. We have to take care of ourselves and look at the company from the inside, mind the cost structure and be careful because after these four or five months, the situation will improve unequally: the ones who do the right thing will have huge potential; but those who exceed on expenses, will have less potential,” the specialist suggested.
The participants, who shared the current situation and projections of their respective sectors, were: Rosana Cordero (Esteban Cordero) and Ramon Ramírez (Maxion Montich) for the automotive sector. Eduardo Borri (Bertotto Boglione y Metalfor) and Julio Piccat (Ingersoll) for the agribusiness sector. Gonzalo Bertone (Cinter), Antonio Oblak (Oblak Aberturas) and Conrado Isla (Carlos Isla) for the construction sector. Guillermo Cruz (Arcor) for the packaging sector. Eduardo Zimmermann (Longvie) for the white goods sector.
Finally, Berardi invited the value chain to use this uncertain market to strengthen each company, and to make the most of the great opportunities that Propymes offer in training and assistance. He also commented about ProPymes Environment, the new proposal that goes along with SMEs clients and vendors in the transition towards a more sustainable industry.
“We are facing a favorable scenario for our value chain, but, undoubtedly, we are also struggling with the difficulties of the pandemic. The challenge is to come up with customized solutions for each sector together,” said Martín Berardi at the end of the meeting.