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Bond Market News
CSN Downgraded to BB- by Fitch
February 4, 2026
Companhia Siderúrgica Nacional (CSN) was downgraded by a notch to BB- from BB by Fitch. The downgrade reflects persistently high leverage, recurring negative free cash flow, and elevated refinancing risk at the holdco level. The rating agency also placed the ratings on rating watch negative highlighting execution risk around CSN’s deleveraging strategy, which relies on asset divestments. According to Fitch, successful asset disposals, particularly majority and minority stakes in the cement and infrastructure businesses targeted to raise BRL15–18bn ($2.9-3.4bn), could materially reduce debt albeit at the cost of reduced business diversification. Despite expected moderation in leverage through 2026, free cash flow is projected to remain negative due to high interest costs, working-capital pressures, and rising mining capex. Stronger mining operations are expected to support earnings, but the steel segment faces persistent pricing pressure from rising imports, particularly from China, the rating agency added.
CSN’s dollar bonds traded stable with its 5.875% 2032s at 81.7, yielding 9.9%.
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