By Brazil Stock Guide – Usinas Siderúrgicas de Minas Gerais S.A. – Usiminas – approved a change in its functional currency from the Brazilian real to the U.S. dollar, effective for financial statements with a reporting date from Jan. 1, 2026. The decision, disclosed under Brazil’s Corporate Law and CVM Resolution 44, aims to better reflect the economic substance of the company’s operations given the environment in which it operates.
The functional currency represents the primary currency of the economic environment in which an entity generates and expends cash. For steelmakers such as Usiminas, whose revenues are significantly influenced by export markets and international steel pricing benchmarks typically denominated in dollars, the shift signals a tighter alignment between accounting metrics and underlying cash flows. Raw materials such as iron ore, coal and other inputs are also widely priced in U.S. currency, reinforcing the rationale behind the move.
Under applicable accounting standards, the company will continue to present its financial statements in Brazilian reais. Amounts recorded in the new functional currency will be translated into reais for reporting and disclosure purposes, preserving comparability for domestic investors and regulatory compliance. The shift does not alter the company’s operational footprint or immediate cash position, but it may reduce accounting volatility arising from exchange-rate swings between the real and the dollar.
The change follows a broader trend among Brazilian exporters and commodity-linked companies seeking to smooth earnings distortions tied to foreign exchange movements. For investors, the move could improve transparency around operating performance by narrowing the gap between reported results and dollar-linked revenues, especially in periods of high currency volatility.
Shares of Usiminas trade on Brazil’s B3 exchange under the tickers USIM3 and USIM5.
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