2Q26 cost pressures cap sequential commodity price improvement

Research evidence excerpt

2Q26 cost pressures cap sequential commodity price improvement

and Ternium are

expected to post the strongest q/q EBITDA growth among peers, supported by higher

Exhibit 1: We update our estimatesprofitability in North America. CSN’s (Underperform) steel EBITDA should also improve

ahead of 2Q26 earnings seasonq/q, supported by higher volumes and prices, although consolidated EBITDA should be

Summary of PO changes

pressured by weaker mining results. Usiminas (Underperform) should remain broadly

stable q/q, as stronger steel results should offset weaker mining performance Rating PO Old PO

BRAP U/P R$ 22.0 R$ 23.0

Base metals: higher copper prices support q/q growth CMIN U/P R$ 3.1 R$ 3.3 CMPC U/P CLP 1,250 CLP 1,050

Base metals should benefit from higher copper prices q/q. Southern Copper and Grupo COPEC U/P CLP 5,100 CLP 5,200

Mexico are expected to post EBITDA growth, supported by better pricing and resilient CSN U/P R$ 5.0 $ 5.0

operational performance. Meanwhile, Ero Copper should also report higher EBITDA q/q, CSN (ADR) U/P $ 0.9 $ 1.0

on higher copper prices and stronger gold volumes sequentially. ERO Neutral CAD 41 CAD 42

ERO (ADR) Neutral $ 30.0 $ 31.0

Pulp & Paper: better prices q/q help results GGBRGGBR (ADR) BuyBuy $$27.55.5 $$27.05.5

Pulp & paper results should improve sequentially across most of our coverage. Suzano GOAU Buy R$ 12.4 R$ 12.2

(Neutral) and Klabin (Buy) are expected to report modest EBITDA growth q/q, supported GMEX Buy MXN 236 MXN 242

by stronger volumes, although higher costs should limit the upside. CMPC KLBN Buy R$ 22.0 R$ 21.0

(Underperform) should benefit from lower cash costs and improved pricing, while Copec KLBN (ADR) Buy $ 8.8 $ 8.6

SCCO U/P $ 180 $ 183

(Underperform) should post higher earnings on stronger Arauco results.