Gerdau (GGB) 20-F 21 Apr 21 2020 FY Annual report (foreign) Financial data

Document and Entity Information

Document and Entity Information	12 Months Ended
	Dec. 31, 2020shares
Document and Entity Information
Entity Registrant Name	GERDAU S.A.
Document Type	20-F
Document Registration Statement	false
Document Annual Report	true
Document Period End Date	Dec. 31, 2020
Document Transition Report	false
Document Shell Company Report	false
Entity Common Stock, Shares Outstanding	573,627,483
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Emerging Growth Company	false
ICFR Auditor Attestation Flag	false
Entity Shell Company	false
Entity Central Index Key	0001073404
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	FY
Amendment Flag	false

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - BRL (R$) R$ in Thousands	Dec. 31, 2020	Dec. 31, 2019
CURRENT ASSETS
Cash and cash equivalents	R$ 4617204	R$ 2641652
Short-term investments	3,041,143	3,652,949
Trade accounts receivable - net	3,737,270	2,672,370
Inventories	9,169,417	7,659,737
Tax credits	1,201,312	504,302
Income and social contribution taxes recoverable	1,051,584	483,088
Fair value of derivatives	0	2,846
Other current assets	591,523	618,769
TOTAL CURRENT ASSETS	23,409,453	18,235,713
NON-CURRENT ASSETS
Tax credits	664,045	465,549
Deferred income taxes	3,393,354	4,071,219
Related parties	134,354	95,445
Judicial deposits	1,825,791	1,991,715
Other non-current assets	590,864	464,169
Prepaid pension cost	39,196	45,381
Investments in associates and joint ventures	2,271,629	1,812,399
Goodwill	12,103,519	9,469,311
Leasing	815,311	777,314
Other intangibles	622,578	673,262
Property, plant and equipment, net	17,252,915	15,901,493
TOTAL NON-CURRENT ASSETS	39,713,556	35,767,257
TOTAL ASSETS	63,123,009	54,002,970
CURRENT LIABILITIES
Trade accounts payable	5,437,953	3,762,768
Short-term debt	1,424,043	1,544,211
Debentures	7,463	18,015
Taxes payable	600,089	432,988
Income and social contribution taxes payable	810,125	205,092
Payroll and related liabilities	591,653	479,693
Dividends payable	510,348	50,968
Leasing payable	231,703	202,536
Employee benefits	208	495
Environmental liabilities	125,992	60,913
Fair value of derivatives	971	0
Obligations with FIDC	944,513	0
Other current liabilities	797,082	666,858
TOTAL CURRENT LIABILITIES	11,482,143	7,424,537
NON-CURRENT LIABILITIES
Long-term debt	13,188,891	11,594,612
Debentures	2,894,954	2,893,029
Related parties	22,855	0
Deferred income taxes	61,562	517,413
Provision for tax, civil and labor liabilities	1,172,511	809,299
Environmental liabilities	171,102	51,395
Employee benefits	1,861,231	1,469,949
Obligations with FIDC	42,893	1,018,501
Leasing payable	624,771	601,733
Other non-current liabilities	514,886	449,375
TOTAL NON-CURRENT LIABILITIES	20,555,656	19,405,306
EQUITY
Capital	19,249,181	19,249,181
Treasury stocks	(229,309)	(242,542)
Capital reserves	11,597	11,597
Retained earnings	7,292,332	5,644,706
Transactions with non-controlling interests without change of control	(2,870,825)	(2,870,825)
Other reserves	7,407,295	5,163,584
EQUITY ATTRIBUTABLE TO THE EQUITY HOLDERS OF THE PARENT	30,860,271	26,955,701
NON-CONTROLLING INTERESTS	224,939	217,426
EQUITY	31,085,210	27,173,127
TOTAL LIABILITIES AND EQUITY	R$ 63123009	R$ 54002970

CONSOLIDATED STATEMENTS OF INCO

CONSOLIDATED STATEMENTS OF INCOME - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
CONSOLIDATED STATEMENTS OF INCOME
NET SALES	R$ 43814661	R$ 39644010	R$ 46159478
Cost of sales	(37,884,102)	(35,440,726)	(40,010,100)
GROSS PROFIT	5,930,559	4,203,284	6,149,378
Selling expenses	(512,950)	(476,339)	(570,431)
General and administrative expenses	(1,017,435)	(954,117)	(1,082,449)
Other operating income	1,763,684	636,847	235,421
Other operating expenses	(645,985)	(187,647)	(270,413)
Impairment of financial assets	(64,132)	(21,044)	(9,914)
Impairment of non-financial assets	(411,925)	0	0
Gains and losses on assets held for sale and sales of interest in subsidiaries	0	0	(414,507)
Equity in earnings of unconsolidated companies	152,569	(17,050)	10,141
INCOME BEFORE FINANCIAL INCOME (EXPENSES) AND TAXES	5,194,385	3,183,934	4,047,226
Financial income	194,092	223,213	204,000
Financial expenses	(1,448,461)	(1,469,754)	(1,579,341)
Bonds Repurchases expenses	(239,273)	0	(223,925)
Exchange variations, net	(204,291)	(247,555)	(322,621)
Gains and losses on derivative financial instruments, net	(774)	(15,118)	32,092
INCOME (LOSS) BEFORE TAXES	3,495,678	1,674,720	2,157,431
Current	(908,051)	(240,400)	(629,209)
Deferred	(199,573)	(217,433)	798,160
Income and social contribution taxes	(1,107,624)	(457,833)	168,951
NET INCOME	2,388,054	1,216,887	2,326,382
ATTRIBUTABLE TO:
Owners of the parent	2,365,763	1,203,736	2,303,868
Non-controlling interests	22,291	13,151	22,514
NET INCOME	R$ 2388054	R$ 1216887	R$ 2326382
EARNINGS PER SHARE
Basic earnings per share - preferred and common - (R$)	R$ 1.39	R$ 0.71	R$ 1.35
Diluted earnings per share - preferred and common - (R$)	R$ 1.38	R$ 0.70	R$ 1.34

CONSOLIDATED STATEMENTS OF COMP

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Net income for the year	R$ 2388054	R$ 1216887	R$ 2326382
Items that may be reclassified subsequently to profit or loss
Other comprehensive income from associates and joint ventures	358,816	55,038	125,719
Cumulative translation adjustment	4,466,084	682,451	2,399,725
Recycling of cumulative translation adjustment to net income	0	0	(811,276)
Unrealized Losses on net investment hedge	(2,504,914)	(322,948)	(1,491,534)
Cash flow hedges
Unrealized (Losses) Gains on Financial Instruments, net of tax	(1,972)	3,502	11,947
Total items that may be reclassified subsequently to profit or loss	2,318,014	418,043	234,581
Items that will not be reclassified subsequently to profit or loss
Remeasurement of defined benefit pension plan, net of tax	(52,072)	(45,561)	152,345
Total items that will not be reclassified subsequently to profit or loss	(52,072)	(45,561)	152,345
Other comprehensive income, net of tax	2,265,942	372,482	386,926
Total comprehensive income for the year, net of tax	4,653,996	1,589,369	2,713,308
Total comprehensive income attributable to:
Owners of the parent	4,594,099	1,565,581	2,668,728
Non-controlling interests	59,897	23,788	44,580
Total comprehensive income for the year, net of tax	R$ 4653996	R$ 1589369	R$ 2713308

CONSOLIDATED STATEMENTS OF CHAN

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - BRL (R$) R$ in Thousands	Total Parent company's interest	Capital	Treasury Stocks	Capital Reserve	Legal reserve	Tax Incentives Reserve	Investments and working capital reserve	Retained earnings	Operations with noncontrolling interests	Gains and losses on net investment hedge	Gains and losses on financial instruments	Cumulative translation adjustment	Pension Plan	Stock Options	Non-controlling interests	Total
Balance at beginning of period at Dec. 31, 2017	R$ 23612848	R$ 19249181	R$ 76085	R$ 11597	R$ 628228	R$ 611531	R$ 2075615	R$ 0	R$ 2870831	R$ 4552984	R$ 27381	R$ 8841450	R$ 472458	R$ 194985	R$ 248706	R$ 23861554
Net income	2,303,868	0	0	0	0	0	0	2,303,868	0	0	0	0	0	0	22,514	2,326,382
Other comprehensive income (loss) recognized in the year	364,860	0	0	0	0	0	0	0	0	(1,491,274)	11,817	1,692,162	152,155	0	22,066	386,926
Total comprehensive income for the year, net of tax	2,668,728	0	0	0	0	0	0	2,303,868	0	(1,491,274)	11,817	1,692,162	152,155	0	44,580	2,713,308
Assignment of preferred shares	18,984	0	11,622	0	0	0	7,362	0	0	0	0	0	0	0	0	18,984
Stock option expenses recognized in the year	(35,836)	0	0	0	0	0	0	0	0	0	0	0	0	(35,836)	(97)	(35,933)
Treasury stocks	(243,396)	0	(243,396)	0	0	0	0	0	0	0	0	0	0	0	(327)	(243,723)
Effects of IAS 29 adoption in the subsidiary of Argentina	502,352	0	0	0	0	0	0	0	0	0	0	502,352	0	0	5,535	507,887
Stock option exercised during the year	23,277	0	27,433	0	0	0	(4,156)	0	0	0	0	0	0	0	77	23,354
Effect of interest changes in subsidiaries	6	0	0	0	0	0	0	0	6	0	0	0	0	0	(85,483)	(85,477)
Complementary Dividends	(51,020)	0	0	0	0	0	(51,020)	0	0	0	0	0	0	0	0	(51,020)
Destination of net income proposed to the shareholders
Legal reserve	0	0	0	0	115,193	0	0	(115,193)	0	0	0	0	0	0	0	0
Tax incentives reserve	0	0	0	0	0	17,051	0	(17,051)	0	0	0	0	0	0	0	0
Investments and working capital reserve	0	0	0	0	0	0	1,406,285	(1,406,285)	0	0	0	0	0	0	0	0
Dividends/interest on capital	(765,339)	0	0	0	0	0	0	(765,339)	0	0	0	0	0	0	(5,024)	(770,363)
Balance at end of period at Dec. 31, 2018	25,730,604	19,249,181	(280,426)	11,597	743,421	628,582	3,434,086	0	(2,870,825)	(6,044,258)	(15,564)	11,035,964	(320,303)	159,149	207,967	25,938,571
Net income	1,203,736	0	0	0	0	0	0	1,203,736	0	0	0	0	0	0	13,151	1,216,887
Other comprehensive income (loss) recognized in the year	361,845	0	0	0	0	0	0	0	0	(322,942)	3,502	726,845	(45,560)	0	10,637	372,482
Total comprehensive income for the year, net of tax	1,565,581	0	0	0	0	0	0	1,203,736	0	(322,942)	3,502	726,845	(45,560)	0	23,788	1,589,369
Stock option expenses recognized in the year	(13,249)	0	0	0	0	0	0	0	0	0	0	0	0	(13,249)	879	(12,370)
Stock option exercised during the year	29,405	0	37,884	0	0	0	(8,479)	0	0	0	0	0	0	0	6	29,411
Effect of interest changes in subsidiaries	0	0	0	0	0	0	0	0	0	0	0	0	0	0	(1,586)	(1,586)
Complementary Dividends	(101)	0	0	0	0	0	(101)	0	0	0	0	0	0	0	0	(101)
Destination of net income proposed to the shareholders
Legal reserve	0	0	0	0	55,876	0	0	(55,876)	0	0	0	0	0	0	0	0
Tax incentives reserve	0	0	0	0	0	86,216	0	(86,216)	0	0	0	0	0	0	0	0
Investments and working capital reserve	0	0	0	0	0	0	705,105	(705,105)	0	0	0	0	0	0	0	0
Dividends/interest on capital	(356,539)	0	0	0	0	0	0	(356,539)	0	0	0	0	0	0	(13,628)	(370,167)
Balance at end of period at Dec. 31, 2019	26,955,701	19,249,181	(242,542)	11,597	799,297	714,798	4,130,611	0	(2,870,825)	(6,367,200)	(12,062)	11,762,809	(365,863)	145,900	217,426	27,173,127
Net income	2,365,763	0	0	0	0	0	0	2,365,763	0	0	0	0	0	0	22,291	2,388,054
Other comprehensive income (loss) recognized in the year	2,228,336	0	0	0	0	0	0	0	0	(2,504,914)	(1,972)	4,787,263	(52,041)	0	37,606	2,265,942
Total comprehensive income for the year, net of tax	4,594,099	0	0	0	0	0	0	2,365,763	0	(2,504,914)	(1,972)	4,787,263	(52,041)	0	59,897	4,653,996
Stock option expenses recognized in the year	15,375	0	0	0	0	0	0	0	0	0	0	0	0	15,375	15	15,390
Stock option exercised during the year	9,596	0	13,233	0	0	0	(3,637)	0	0	0	0	0	0	0	0	9,596
Effect of interest changes in subsidiaries	0	0	0	0	0	0	0	0	0	0	0	0	0	0	12,776	12,776
Complementary Dividends	(13)	0	0	0	0	0	(13)	0	0	0	0	0	0	0	0	(13)
Destination of net income proposed to the shareholders
Legal reserve	0	0	0	0	109,649	0	0	(109,649)	0	0	0	0	0	0	0	0
Tax incentives reserve	0	0	0	0	0	172,792	0	(172,792)	0	0	0	0	0	0	0	0
Investments and working capital reserve	0	0	0	0	0	0	1,368,835	(1,368,835)	0	0	0	0	0	0	0	0
Dividends/interest on capital	(714,487)	0	0	0	0	0	0	(714,487)	0	0	0	0	0	0	(65,175)	(779,662)
Balance at end of period at Dec. 31, 2020	R$ 30860271	R$ 19249181	R$ 229309	R$ 11597	R$ 908946	R$ 887590	R$ 5495796	R$ 0	R$ 2870825	R$ 8872114	R$ 14034	R$ 16550072	R$ 417904	R$ 161275	R$ 224939	R$ 31085210

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Cash flows from operating activities
Net income for the year	R$ 2388054	R$ 1216887	R$ 2326382
Adjustments to reconcile net income for the year to net cash provided by operating activities
Depreciation and amortization	2,499,104	2,074,295	1,891,814
Impairment of assets	411,925	0	0
Equity in earnings of unconsolidated companies	(152,569)	17,050	(10,141)
Exchange variation, net	204,291	247,555	322,621
Gains and losses on derivative financial instruments, net	774	15,118	(32,092)
Post-employment benefits	203,689	165,487	189,603
Long-term incentive plans	62,801	43,895	41,186
Income tax	1,107,624	457,833	(168,951)
(Gains) Losses on disposal of property, plant and equipment	(18,482)	2,129	(41,109)
Gains and losses on assets held for sale and sales of interest in subsidiaries	0	0	414,507
Impairment of financial assets	64,132	21,044	9,914
Provision (reversal) of tax, civil, labor and environmental liabilities, net	477,518	38,417	(56,409)
Tax credits recovery	(1,358,744)	(402,499)	0
Interest income on short-term investments	(99,359)	(72,784)	(49,745)
Interest expense on loans	1,022,460	938,120	1,177,686
Interest on loans with related parties	(8,277)	(4,767)	(545)
Provision (Reversal) for net realisable value adjustment in inventory	(40,697)	24,665	8,228
Cash flows from operations before changes in working capital	6,764,244	4,782,445	6,022,949
Changes in assets and liabilities
(Increase) Decrease in trade accounts receivable	(527,722)	656,831	71,631
(Increase) Decrease in inventories	(428,263)	1,556,713	(2,427,473)
Increase (Decrease) in trade accounts payable	1,014,800	(642,699)	900,388
Decrease (Increase) in other receivables	369,076	146,825	(118,988)
Increase (Decrease) in other payables	182,934	(462,906)	(1,160,626)
Dividends from joint ventures	94,937	44,037	55,357
Purchases of short-term investments	(3,224,158)	(3,676,744)	(1,512,123)
Proceeds from maturities and sales of short-term investments	3,924,799	521,616	1,629,595
Cash provided by operating activities	8,170,647	2,926,118	3,460,710
Interest paid on loans and financing	(1,079,981)	(945,027)	(1,162,364)
Interest paid on lease liabilities	(61,727)	(83,620)	0
Income and social contribution taxes paid	(621,033)	(254,679)	(298,663)
Net cash provided by operating activities	6,407,906	1,642,792	1,999,683
Cash flows from investing activities
Purchases of property, plant and equipment	(1,650,778)	(1,746,600)	(1,194,934)
Proceeds from sales of property, plant and equipment, investments and other intangibles	61,275	21,805	4,021,251
Additions in other intangibles	(154,250)	(100,313)	(67,388)
Advance for future investment in joint venture	0	(94,687)	(375,456)
Capital (increase) decrease in joint venture	(42,782)	20,344	0
Payment for business combination	(442,542)	0	0
Net cash (used) provided by investing activities	(2,229,077)	(1,899,451)	2,383,473
Cash flows from financing activities
Purchase of treasury shares	0	0	(243,396)
Dividends and interest on capital paid	(274,815)	(484,173)	(599,099)
Proceeds from loans and financing	3,120,745	5,585,573	2,560,789
Repayment of loans and financing	(5,084,028)	(4,885,083)	(6,000,433)
Leasing payment	(247,914)	(161,824)	0
Intercompany loans, net	(7,777)	(64,089)	25,755
Net cash used in financing activities	(2,493,789)	(9,596)	(4,256,384)
Exchange variation on cash and cash equivalents	290,512	17,763	208,034
Increase (Decrease) in cash and cash equivalents	1,975,552	(248,492)	334,806
Cash and cash equivalents at beginning of year	2,641,652	2,890,144	2,555,338
Cash and cash equivalents at end of year	R$ 4617204	R$ 2641652	R$ 2890144

GENERAL INFORMATION

GENERAL INFORMATION	12 Months Ended
	Dec. 31, 2020
GENERAL INFORMATION
GENERAL INFORMATION	NOTE 1 — GENERAL INFORMATION Gerdau S.A. is a publicly traded corporation (sociedade anônima) with its corporate domicile in the city of São Paulo, Brazil. Gerdau S.A and subsidiaries (collectively referred to as the “Company”) is a leading producer of long steel in the Americas and one of the largest suppliers of special steel in the world. In Brazil, the Company also produces flat steel and iron ore, activities which expanded the product mix and made its operations even more competitive. The Company believes it is the largest recycler in Latin America and around the world it transforms each year millions of tons of scrap into steel, reinforcing its commitment to sustainable development of the regions where it operates. Gerdau is listed on the São Paulo, New York and Madrid stock exchanges. The Consolidated Financial Statements of Gerdau S.A and subsidiaries were approved by the Board of Directors on April 20, 2021.

SUMMARY OF SIGNIFICANT ACCOUNTI

SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES	12 Months Ended
	Dec. 31, 2020
SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES
SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES	NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES 2.1 — Basis of Presentation The Company’s Consolidated Financial Statements have been prepared in accordance and are in compliance with the International Financial Reporting Standards (IFRS) issued by International Accounting Standards Board (IASB). The preparation of the Consolidated Financial Statements in accordance with IFRS requires Management to make accounting estimates. The areas that involve judgment or use of estimates relevant to the Consolidated Financial Statements are stated in Note 2.17. The Consolidated Financial Statements have been prepared using historical cost as its basis, except for the valuation of certain financial instruments, which are measured at fair value. The Company adopted all applicable standards and revisions of standards and interpretations issued by the IASB or the IFRS Interpretations Committee that are effective as of December 31, 2020. a) Investments in Subsidiaries The Company’s consolidated financial statements include the financial statements of Gerdau S.A. and all its subsidiaries. The Company controls an entity when it is exposed or has the right to variable returns arising from their involvement with the entity and has the ability to affect those returns due to the power exercised over the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Company. They are deconsolidated from the date that control ceases. Third parties’ interests in equity and net income of subsidiaries are reported separately in the consolidated balance sheet and in the consolidated statement of income, respectively, under the account “Non-controlling interests”. For business combinations, the assets, liabilities, and contingent liabilities of a subsidiary are reported at their respective fair value on the date of acquisition. Any excess of the acquisition cost over the fair value of the identifiable net assets acquired is recorded as goodwill. When the acquisition cost is less than the fair value of the net assets identified, the difference is recorded as a gain in the statement of income for the year in which the acquisition took place. The non-controlling interests are presented based on the proportion of the fair value of the identified assets and liabilities acquired. Intercompany transactions and balances are eliminated in the consolidation process. Gains or losses resulting from transactions among consolidated entities of the Company are also eliminated. b) Investments in Joint ventures and Associate companies Joint ventures are those in which the control is held jointly by the Company and one or more partners. An associate company is one in which the Company exercises significant influence, but over which it does not have control. Investments in joint ventures and associate companies are recorded under the equity accounting method. c) Equity in Earnings of Unconsolidated Companies According to this method, investments are recognized in the consolidated balance sheet at acquisition cost and are adjusted subsequently based on the Company’s share in the earnings and in other changes in the net assets of the Associates and Joint Ventures. The balances of the investments can also be reduced due to impairment losses. Furthermore, dividends received from these companies are recorded as reductions in the value of the investments. 2.2 —Foreign Currency Translation a) Functional and Reporting Currency The functional currency of an entity is the currency of the primary economic environment where it operates. The Consolidated Financial Statements are presented in Brazilian Reais (R$), which is the functional and reporting currency of the Company. All balances were rounded to the nearest thousand, unless otherwise stated. b) Transactions and Balances For purposes of the Consolidated Financial Statements, the balances of each subsidiary of the Company are converted into Brazilian reais, which is the functional currency of the Company and the reporting currency of its Consolidated Financial Statements, at the exchange rates at the dates of the transactions. c) Translation of financial statements in foreign currency The results of operations and financial position of all subsidiaries included in the consolidated financial statements, along with equity investments, which have functional currencies different from the Company’s reporting currency are translated into the reporting currency as follows: i) Asset and liability balances are translated at the exchange rate in effect at the balance sheet date; ii) Income and expenses are translated using the average monthly exchange rates for the year; iii) Translation gains and losses resulting from the above methodology are recognized in Equity, in the Statement of Comprehensive Income, in the account named “Other reserves - Cumulative translation adjustment”; and iv) The amounts presented in the cash flow are extracted from the converted changes in assets, liabilities and results. d) Hyperinflation in Venezuela and Argentina Argentina and Venezuela are considered countries with hyperinflation and for this reason, the Financial Statements of the subsidiaries located in these countries are being updated so that their values are shown in the monetary unit of measurement at the end of the year, which considers the effects measured by the inflation rates in these countries. 2.3 — Financial Assets At initial recognition, a financial asset is classified as measured at amortized cost, at fair value through profit or loss or at fair value through other comprehensive income. Financial assets are not reclassified subsequent to initial recognition, unless the Company changes the business model for the management of financial assets. The Company performs an evaluation of the business model objective in which a financial asset is held in the portfolio because this better reflects the way in which the business is managed. a) Financial assets at amortized cost These assets are measured subsequently to initial recognition at the amortized cost using the effective interest method. The amortized cost is reduced by impairment losses. Interest income, foreign exchange gains and losses and impairment are recognized directly in income. Any gain or loss on derecognition is recognized on statement of income. b) Financial assets measured at fair value through profit or loss These assets are measured subsequently to initial recognition at the fair value. The net result, including interest, is recognized directly in income. c) Financial assets measured at fair value through other comprehensive income These assets are measured subsequently to initial recognition at fair value. Interest income calculated using the effective interest method, exchange gains and losses and impairment are recognized in the statement of income. Other net results are recognized in other comprehensive income. In derecognition, the accumulated result in other comprehensive income is reclassified to the statement of income. d) Impairment of financial assets I) Impairment of financial assets as from January 1, 2019 The Company measures the impairment of financial assets in an amount equal to the Expected credit loss. In determining whether the credit risk of a financial asset has increased significantly since the initial recognition and in estimating the expected credit losses, the Company considers reasonable and supportable information that is relevant and available without undue cost or effort. This includes quantitative and qualitative information and analysis, based on the Company’s historical experience, credit assessment and considering forward-looking information. The impairment loss of financial assets was calculated based on the credit risk analysis, which includes the historical losses, the individual situation of the clients, the situation of the economic group to which they belong, the real guarantees for the debts and the evaluation of the legal advisors and is considered sufficient to cover possible losses on amounts receivable, in addition to a prospective assessment that takes into account the change or expectation of change in economic factors that affect expected credit losses, which will be determined based on probabilities weighted. The Company presents the impairment of the financial assets in the Statement of Income in the line of Impairment of financial assets. II) Impairment of financial assets as of and for year ended December 31, 2018 The Company measures the allowance for doubtful accounts in an amount equal to the expected loss of credit. In determining whether the credit risk of a financial asset has increased significantly since the initial recognition and in estimating the expected credit losses, the Company considers reasonable and bearable information that is relevant and available at no charge or over-effort. This includes quantitative and qualitative information and analysis, based on the Company's historical experience, credit assessment and considering forward-looking information. The provision for credit risks was calculated based on the credit risk analysis, which includes the historical losses, the individual situation of the clients, the situation of the economic group to which they belong, the real guarantees for the debts and the evaluation of the legal advisors and is considered sufficient to cover possible losses on amounts receivable, in addition to a prospective assessment that takes into account the change or expectation of change in economic factors that affect expected credit losses, which will be determined based on probabilities weighted. e) Derecognition The Company derecognizes a financial asset when expire the contractual rights of the cash flows of the asset, or when the Company transfers the contractual rights of that cash flows in a transaction in which substantially all the risks and benefits of the financial asset are transferred or in which the Company neither transfers nor maintains substantially all the risks and benefits of the financial asset and also does not retain control over the financial asset. f) Compensation Financial assets and liabilities are offset, and the net amount presented in the balance sheet when, and only when, the Company currently has a legally enforceable right to offset the amounts and intends to settle them on a net basis or to realize the asset and settle the liability simultaneously. g) Financial Instruments A financial asset is measured at amortized cost if it meets both of the following conditions and is not designated as measured at fair value through profit or loss: it is maintained within a business model whose objective is to maintain financial assets to receive contractual cash flows; and its contractual terms generate, at specific dates, cash flows that are related only to payment of principal and interest outstanding amounts. A debt instrument is measured at fair value through other comprehensive income if it meets both of the following conditions and is not designated as measured at fair value through profit or loss: it is maintained within a business model whose objective is achieved both by receipt of contractual cash flows and sale of financial assets; and its contractual terms generate, on specific dates, cash flows that are only payments of principal and interest on the outstanding principal amount. In the initial recognition of an investment in an equity instrument that is not held for trading, the Company may irrevocably choose to present subsequent changes in the fair value of the investment in other comprehensive income. This choice is made investment by investment. The Company performs an evaluation of the business model objective in which a financial asset is held in the portfolio because this better reflects the way in which the business is managed, and the information is provided to Management. The information considered includes: the policies and objectives stipulated for the portfolio and the practical operation of those policies. They include the question of whether Management’s strategy focuses on obtaining contractual interest income, maintaining a certain interest rate profile, matching the duration of financial assets with the duration of related liabilities or expected outflows of cash, or the realization of cash flows through the sale of assets; how the performance of the portfolio is evaluated and reported to the Company’s Management; the risks that affect the performance of the business model (and the financial asset held in that business model) and the manner in which those risks are managed; the frequency, volume and timing of sales of financial assets in prior periods, the reasons for such sales and their expectations about future sales. h) Evaluation on whether contractual cash flows are only payments of principal and interest For the purposes of this valuation, the ‘principal’ is defined as the fair value of the financial asset at the initial recognition. ‘Interest’ is defined as a consideration for the time value of money and for the credit risk associated with the principal amount outstanding over a given period of time and for the other underlying risks and costs of borrowing (e.g. liquidity risk and costs administrative costs), as well as a profit margin. The Company considers the contractual terms of the instrument to assess whether contractual cash flows are only principal and interest payments. This includes assessing whether the financial asset contains a contractual term that could change the timing or value of the contractual cash flows so that it would not meet that condition. In making this assessment, the Company considers: contingent events that modify the value or the time of cash flows; terms that may adjust the contractual rate, including variable rates; the prepayment and the extension of the term; and terms that limit the Company’s access to cash flows of specific assets (for example, based on the performance of an asset). The prepayment is consistent with the principal and interest payments criterion if the prepayment amount represents, for the most part, unpaid principal and interest amounts on the outstanding principal amount - which may include additional compensation the early termination of the contract. 2.4 — Inventories Inventories are measured at the lower of historical cost of acquisition or production and net realizable value. The acquisition and production costs include transportation, storage and non-recoverable taxes. Net realizable value is the estimated sale price in the ordinary course of business less the estimated costs of completion and selling expenses directly related. Information regarding the allowance for adjustments to net realizable value is presented in note 6. 2.5 — Property, Plant and Equipment Property, plant and equipment are stated at historical cost, monetarily adjusted when applicable, less depreciation, except for land, which is not depreciated. The Company recognizes monthly to the construction costs of qualified assets, which are assets that, necessarily, require a substantial period of time to be finished for its intended use, the borrowing costs as part of the acquisition cost of the property, plant and equipment under construction based on the following capitalization criteria: (a) the capitalization period begins when the property, plant and equipment item is under construction in process and the capitalization of borrowing costs ceases when the asset is available for use; (b) borrowing costs are capitalized considering the weighted average rate of loans existing on the capitalization date or a specific rate, in the case of loans for the acquisition of property, plant and equipment; (c) borrowing costs capitalized do not exceed the interest expenses during the capitalization period; and (d) capitalized borrowing costs are depreciated considering the same criteria and useful life determined for the property, plant and equipment item to which it was capitalized. Depreciation is calculated under the straight-line method at rates that take into consideration the estimated useful life of the asset, its level of utilization and the estimated residual value of the asset at the end of its useful life. The estimated residual value and useful life of the assets are reviewed and adjusted, if necessary, at each year-end. Subsequent costs are added to the carrying amount of property, plant and equipment or recognized as a specific item, as appropriate, only if the economic benefits associated to these items are probable and the amounts can be reliably measured. The carrying amount of replaced items is written-off. Other repairs and maintenance are recognized directly in income when incurred. Mining exploration rights are classified as Land and Buildings in the Property, plant and equipment account. Exploration expenditures are recognized as expenses until the feasibility of mining activity is established and thereafter subsequent costs are capitalized. Costs for the development of new iron ore reserves or to expand the capacity of operating mines are capitalized and amortized based on the amount of iron ore extracted. Stripping costs (costs associated with removal of waste and other residual materials) incurred during the development phase of a mine, before production phase, are registered as part of the depreciable cost of asset. Subsequently, these costs are depreciated over the useful life of the mine. Spending on waste removal, after the start of production of the mine, are treated as production costs. Depletion of mines is calculated based on the amount of ore extracted. The net book value of property, plant and equipment items is immediately impaired to its recoverable amount when the residual balance exceeds the recoverable amount. 2.6 — Goodwill Goodwill represents the excess of the acquisition cost over the fair value net of the assets acquired, liabilities assumed and identifiable contingent liabilities of a subsidiary, joint venture, or associate company, at the respective acquisition date. Goodwill is recorded as an asset and recorded under “Goodwill” account. Goodwill is not amortized and is subject to impairment tests annually or whenever there are indications of potential impairment. Any impairment loss is recorded as an expense in the income statement and cannot be reversed. Goodwill is allocated to the operating segments, which represents the lowest level at which goodwill is monitored by management. Goodwill that forms part of the carrying amount of an investment in an associate or a joint venture is not separately recognized. The entire carrying amount of the investment in associate or joint venture is tested for impairment as a single asset, by comparing its recoverable amount (higher of value in use and fair value less costs to sell) with it carrying amount. When a subsidiary, joint venture or associate is sold, goodwill is included in the determination of gains and losses on disposal. 2.7 — Other Intangible Assets Other intangible assets are stated at acquisition cost, less accumulated amortization and impairment losses, when applicable. Intangible assets consist mainly of assets which represent the capacity to generate economic benefits from companies acquired based on relationships with customers and suppliers, software and others. Intangible assets with definite useful lives are amortized taking into consideration their actual use or a method that reflects their consumption of economic benefits. The net book value of intangible assets is impaired immediately to its recoverable value when the residual balance exceeds the recoverable amount (note 2.8). Intangible assets acquired in a business combination are recorded at fair value, less accumulated amortization and impairment losses, when applicable. Intangible assets that have a defined useful life are amortized over their useful lives using an amortization method that reflects the economic benefit of the intangible asset and is recorded in the cost of sales account. The intangible relationship with customers and suppliers is amortized based on an accelerated method that considers the expected future economic benefit provided over time by these new acquired customers and suppliers. The Company reviews the amortization period and amortization method for its intangible assets with definite useful lives at the end of each year. 2.8 — Provision for Impairment of Assets and Reversal of Impairment At each balance sheet date, the Company performs an assessment to determine whether there is evidence that the carrying amount of long-lived assets might be impaired. If such evidence is identified, the recoverable amount of the assets is estimated by the Company. The recoverable amount of an asset is determined as the higher of: (a) its fair value less estimated costs to selling and (b) its value in use. The value in use is measured based on discounted cash flows (before taxes) derived from the continuous use of the asset until the end of its estimated useful life. Regardless of whether or not there is any indication that the carrying amount of the asset may be impaired, the balances of goodwill arising from business combinations and intangible assets with indefinite useful lives are tested for impairment at least once a year in December. When the carrying amount of the asset exceeds its recoverable amount, the Company recognizes a reduction in the book value of the asset (Impairment). The reduction to the recoverable amount of the asset is recorded as an expense. Except for an impairment of goodwill, a reversal of a previously recorded impairment loss is required. Reversal in these circumstances is limited to the amount of the depreciated balance of the asset at the time of the reversal, determined as if the impairment had not been recorded, as discussed in note 30.1. The Company does not believe there is a reasonable likelihood that may occur a material change in the estimates or assumptions used to calculate long-lived asset impairment losses. However, if actual results are not consistent with estimates and assumptions used in estimating future cash flows and asset fair values, the Company may be exposed to losses that could be material. 2.9 — Financial Liabilities and Equity Instruments a) Financial liabilities Financial liabilities are classified as amortized cost or at fair value through profit or loss. A financial liability is classified as fair value through profit or loss if it is classified as held for trading, it is a derivative, or it is designated as such at initial recognition. Financial liabilities measured at fair value through profit or loss are measured at fair value and the net result, including interest, is recognized in the income statement. Other financial liabilities are subsequently measured at amortized cost using the effective interest method. Interest expense, exchange gains and losses are recognized in income. b) Derecognition The Company derecognizes a financial liability when its contractual obligation is withdrawn, canceled or expired. The Company also derecognizes a financial liability when the terms are modified and the cash flows of the modified liability are substantially different, in which case a new financial liability based on the modified terms is recognized at fair value. In the derecognition of a financial liability, the difference between the carrying amount extinguished and the consideration paid (including any non-cash assets transferred or liabilities assumed) is recognized in the income statement. c) Derivative Instruments and hedging The Company enters into derivative financial instruments mainly to manage its exposure to fluctuation in interest rates and exchange rates. The Company measures its derivative financial instruments, based on quotations obtained from market participants, at fair value at the balance sheet date. Changes in the fair value of a derivative that is highly effective and that is designated and qualifies as a cash flow hedge or a net investment hedge are recorded in the statement of comprehensive income. The Company assesses, both at the beginning of hedge coverage and on an ongoing basis, whether the derivatives used in hedge transactions are highly effective in offsetting changes in the fair value or cash flows of hedged items. When a cash flow hedge instrument is sold, terminated, expired or exercised, the hedge is discontinued prospectively, but the cumulative unrealized gain or loss is recognized in the comprehensive income statement. The cumulative gain and loss is transferred from the comprehensive income and recognized in the income statement when the hedged transaction is recognized in the statement of income. When no more than one transaction is expected to occur, the accumulated gain or loss is immediately transferred to the income statement. In cases of net investment hedges, the amount recorded in the statement of comprehensive income is written off and recognized in the statement of income when the disposal of the hedged investment occurs. In addition, changes in the fair value of financial instruments not characterized as hedges are recognized in the line of (Loss) Gains on financial instruments, net, in the statement of income. d) Equity instruments The equity component is initially recognized by the difference between the fair value of the compound financial instrument as a whole and the fair value of the liability component. Any directly attributable transaction costs are allocated to the liability and equity components in proportion to their initial carrying amounts. 2.10 — Current and Deferred Income and Social Contribution Taxes Current income and social contribution tax expense is calculated in conformity with enacted tax rate in effect at the balance sheet date in the countries where the Company’s subsidiaries, associates and joint venture operate and generate taxable income. Management periodically evaluates positions taken in relation to tax matters which are subject to interpretation and recognizes a provision when there is an expectation of payment of income tax and social contribution in accordance with the tax bases. The expense for income tax and social contribution taxes comprises current and deferred taxes. Current tax and deferred tax are recognized in income unless they are recognized for a business combination, or for items directly recognized in equity through other comprehensive income. Current tax is the estimated tax payable or receivable on the taxable income or loss for the year, at the tax rates effective at the balance sheet date. Deferred income tax and social contribution are recognized in its total on the differences generated between assets and liabilities recognized for tax purposes and corresponding to amounts recognized in the Financial Statements. However, deferred income and social contribution taxes are not recognized arising from the initial recognition of assets and liabilities in a transaction other than a business combination and that do not affect the tax basis. Income and social contribution taxes are determined based on tax rates (and laws) effective at the balance sheet date and applicable when the respective income and social contribution taxes is paid. Deferred income and social contribution tax assets are recognized only to the extent that it is probable that there will be taxable income for which the temporary differences can be used, and tax losses can be compensated. Deferred tax assets recorded for tax loss carryforwards are supported by projections of taxable income based on technical feasibility studies submitted annually to the Board of Directors of the Company and its subsidiaries, when applicable. These studies consider historical profitability of the Company and its subsidiaries, expectations of continuous profitability and estimates of the recovery of deferred tax assets over future years. Other deferred tax assets arising from temporary differences, mainly tax provision, are recognized according to their estimate of realization. Deferred income tax and social contribution assets are reviewed at each reporting date and will be reduced to the extent that their realization is not more likely than not based on future taxable income. The Company recognizes a provision for tax matters only if a past event gives rise to a present obligation. The Company determines whether a present obligation exists at the end of the year considering all available evidence, including, for example, the opinion of legal advisors. The Company also considers whether it is more likely than not that there will be an outflow of assets and whether a reliable estimate can be made. 2.11 — Employee Benefits The Company has several employee benefit plans including pension and retirement plans, health care benefits, profit sharing, bonus, and share-based payment, as well as other retirement and termination benefits. The main benefit plans granted to the Company’s employees are described at notes 21 and 27. The actuarial obligations related to the pension and retirement benefits and the actuarial obligations related to the health care plans are recorded based on actuarial calculations performed every year by independent actuaries, using the projected unit credit method, net of the plan assets, when applicable, and the related costs are recognized over the employees’ service period. Any employee benefit plan surpluses are also recognized up to the probable amount of reduction in future contributions by the Company. Actuarial remeasurement arising from adjustments and changes in actuarial assumptions of the pension and retirement benefit plans and actuarial obligations related to the health care plan are recognized directly in the Statement of Comprehensive Income as described in Note 21. In accounting for pension and post-retirement benefits, several statistical and other factors that attempt to anticipate future events are used to calculate plan expenses and liabilities. These factors include discount rate assumptions, return on plan assets, future increases in health care costs, and rate of future compensation increases. In addition, the Company and its actuarial uses other factors whose measurement involves judgment are used such as withdrawal, turnover, and mortality rates. The actuarial assumptions used by the Company may differ materially from actual results in future periods due to changing market and economic conditions, regulatory events, judicial rulings, higher or lower withdrawal rates, or longer or shorter participant life spans. 2.12 — Other Current and Non-current Assets and Liabilities Other current and non-current assets and liabilities are recorded at their realizable amounts (assets) and at their known or estimated amounts plus accrued charges and monetary adjustments (liabilities), when applicable. 2.13 — Related-Party Transactions Loan agreements between the entities in Brazil and abroad are adjusted by contractual financial charges plus foreign exchange variation, when applicable. These contracts have an expiration date, with the possibility of extension of time by agreement between the parties. Sales and purchases of raw materials and products are made under terms and conditions contractually established between the parties. 2.14 — Dividends and Interest on equity Dividend payments are recognized as liabilities at the time dividends are approved by the shareholders of Gerdau S.A. The bylaws of Gerdau S.A. required dividends of not less than 30% of the annual net income adjusted by 5% representing the constitution of legal reserve, and the constitution of tax incentives reserve; therefore, Gerdau S.A. records a liability at year-end for the minimum dividend amount that has not yet been paid during the year up to the limit of the mandatory minimum dividend described above. 2.15 — Revenue Recognition Net sales are presented net of taxes and discounts. Revenues from sales of products are recognized to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The related costs of freight are included in cost of sales. 2.16 — Investments in Environmental Protection and Environmental liabilities Environmental costs that relate to current operations are expensed or capitalized as appropriate. Environmental costs that relate to an existing condition caused by past operations, and which do not contribute to current or future revenue generation or cost reduction are recorded as expense. Liabilities are recorded when environmental assessments or remedial ef

CONSOLIDATED FINANCIAL STATEMEN

CONSOLIDATED FINANCIAL STATEMENTS	12 Months Ended
	Dec. 31, 2020
CONSOLIDATED FINANCIAL STATEMENTS
CONSOLIDATED FINANCIAL STATEMENTS	NOTE 3 — CONSOLIDATED FINANCIAL STATEMENTS 3.1 — Subsidiaries Listed below are the significant consolidated subsidiaries, as follows: Equity Interests Consolidated company Country Total capital (*) 2020 2019 2018 Gerdau GTL Spain S.L. Spain 100.00 100.00 100.00 Gerdau Internacional Empreendimentos Ltda. - Grupo Gerdau Brazil 100.00 100.00 100.00 Gerdau Ameristeel Corporation and subsidiaries (1) USA/Canada 100.00 100.00 100.00 Gerdau Açominas S.A. and subsidiary Brazil 99.86 99.83 99.83 Gerdau Aços Longos S.A. and subsidiaries (2) Brazil 99.82 99.82 99.78 Gerdau Steel Inc. Canada 100.00 100.00 100.00 Gerdau Holdings Inc. and subsidiary (3) USA 100.00 100.00 100.00 Paraopeba - Fixed-income investment fund (4) (**) Brazil 89.26 96.96 91.40 Gerdau Hungria Holdings Limited Liability Company Hungary 100.00 100.00 100.00 GTL Equity Investments Corp. British Virgin Islands 100.00 100.00 100.00 Empresa Siderúrgica del Perú S.A.A. - Siderperú Peru 90.03 90.03 90.03 Gerdau GTL México, S.A. de C.V. and subsidiaries (5) Mexico 100.00 100.00 100.00 Seiva S.A. - Florestas e Indústrias Brazil 97.73 97.73 97.73 Gerdau Laisa S.A. Uruguai 100.00 100.00 100.00 Sipar Gerdau Inversiones S.A. Argentina 99.99 99.99 99.99 Sipar Aceros S.A. and subsidiary (6) Argentina 99.98 99.98 99.98 Sizuca - Siderúrgica Zuliana, C. A. Venezuela 100.00 100.00 100.00 GTL Trade Finance Inc. British Virgin Islands 100.00 100.00 100.00 Gerdau Trade Inc. British Virgin Islands 100.00 100.00 100.00 (*) (**) (1) Subsidiaries: Gerdau Ameristeel US Inc., Chaparral Steel Company. (2) Subsidiary: Gerdau Açominas Overseas Ltd., G2L Logistica Ltda. and Siderúrgica Latino-Americana S.A.. (3) Subsidiary: Gerdau MacSteel Inc. (4) Fixed-income investment fund managed by Bank JP Morgan S.A. (5) Subsidiary: Sidertul S.A. de C.V. and GTL Servicios Administrativos México, S.A. de C.V.. (6) Subsidiary: Siderco S.A. 3.2 — Joint ventures Listed below are the interests in joint ventures: Equity Interests Total capital (*) Joint ventures Country 2020 2019 2018 Bradley Steel Processors Canada 50.00 50.00 50.00 MRM Guide Rail Canada 50.00 50.00 50.00 Gerdau Corsa S.A.P.I. de CV Mexico 70.00 70.00 50.00 Gerdau Metaldom Corp. Dominican Rep. 50.00 50.00 50.00 Gerdau Summit Aços Fundidos e Forjados S.A. Brazil 58.73 58.73 58.73 Diaco S.A. Colombia 49.87 49.87 49.87 Juntos Somos Mais Fidelização S.A. Brazil 27.50 27.50 27.50 (*) The voting capital is substantially equal to the total capital. The interests reported represent the ownership percentage held directly and indirectly held in the joint venture. The summarized financial information of these joint ventures, accounted for under the equity method, is shown on a combined basis as follows: Joint ventures 2020 2019 2018 Net income (loss) 249,158 (16,403) Total comprehensive income (loss) 249,158 (16,403) During the year of 2019, the Company made a capital increase in the company Gerdau Corsa S.A.P.I. of C.V. in the amount of R$ 463,990, which resulted in the change of the participation held by the Company in this company to 70.00%, remaining as a joint venture, according to the shareholders' agreement. 3.3 — Associate companies Listed below are the interests in associate companies: Equity interests Total capital (*) Associate companies Country 2020 2019 2018 Dona Francisca Energética S.A. Brazil 51.82 51.82 51.82 Corsa Controladora, S.A. de C.V. Mexico - - 49.00 (*) The voting capital is substantially equal to the total capital. The interests reported represent the ownership percentage held directly and indirectly. Although the Company owns more than 50% of Dona Francisca Energética S.A., it does not consolidate the financial statements of this associate because of the veto rights granted to minority shareholders that prevent the Company from controlling the decisions in conducting the associate’s business. The summarized financial information of the associate companies, accounted for under the equity method, is shown on a combined basis as follows: Associate Companies 2020 2019 2018 Net income 42,008 31,249 31,806 Total comprehensive income 42,008 31,249 31,806 During the year of 2019 the associate company Corsa Controladora, S.A. de C.V. was merged into the joint venture Gerdau Corsa S.A.P.I. de C.V. 3.4 — Acquisition of subsidiary On November 30, 2020, the Company, through its subsidiary Gerdau Aços Longos SA, concluded, after complying with the respective precedent conditions, including the approval of the Administrative Council for Economic Defense - CADE, the acquisition of 96.35% of the total and voting shares issued by Siderúrgica Latino-Americana S.A. (“Silat”) for R$ 475,961, using cash resources. Silat is in Caucaia, in the metropolitan region of Fortaleza, State of Ceará and has an annual installed capacity of 600 thousand tons (unaudited) of long steel rolled. Through this transaction, Gerdau reinforces its long-term strategy and its position in the steel value chain through investments and acquisitions. The addition of this new unit helps the Company in the supply equation for the Brazilian market as a whole, as it is associated with our other capacities in the Northeast and Southeast regions, allowing for more optimized conditions of supply to our customers throughout the country. The Company concluded the fair value assessment of the assets and liabilities of Silat and the following table summarizes the fair value of such assets and liabilities at the date of business combination: Fair value of the Cash and cash equivalents 33,419 Trade accounts receivable - net 13,190 Inventories 24,160 Other current assets 11,091 Property, plant and equipment 486,757 Other non-current assets 34,410 Current liabilities (26,638) Deferred income taxes (86,093) Other non-current liabilities (359) Non-controlling interest (11,495) Assets (Liabilities) 478,442 Bargain purchase (2,481) Net assets 475,961 Amounts related to net sales and accounts receivables, attributed to Silat and included in the Company’s Consolidated Financial Statements since the acquisition date are not material. Silat, since the acquisition date until December 31, 2020, did not generate significant amounts of net sales and net income. In addition, the amount of net sales and net profit generated by this entity during the period ended December 31, 2020, had it been acquired at the beginning of that period, would not have been material. The negative goodwill of R$ 2,481 was recorded in the Other operating income line in the Statements of Income. 3.5 - Total purchase price considered for the 2020 acquisition Subsidiary acquired 2020 Siderúrgica Latino-Americana S.A. 475,961 Total consideration paid 475,961 Less: Cash and cash equivalents of acquired subsidiary (33,419) 442,542 3.6 — Gains and losses on assets held for sale and sales of interest in subsidiaries On March 30, 2018, the Company completed the sale of its wire rod mill located in Beaumont, Texas, and the Beaumont Wire Products and Carrollton Wire Products processing units for Optimus Steel LLC for US$ 99.5 million (equivalent to R$ 330.7 million). The mill has a melt shop capable of rolling wire rod and rebar in roll. On June 29, 2018, the Company concluded the sale of 100% of the shares of Aza Participações SpA and its subsidiaries, Gerdau AZA SA; Aceros Cox SA; Armacero - Matco SA; and Salomon Sack S.A., for the group of Chilean investors formed by Ingeniería e Inversiones Limitada; Inversiones Reyosan SpA; Los Andes SA de Inversiones and Matco Cables SpA. This sale includes three production plants of long recycled steel per year and its distribution network in Chile, which were presented until the conclusion of the sale within the South American Segment. The transaction value attributed corresponds to US$ 154.1 million (equivalent to R$594.2 million on the date of the conclusion of the sale). On July 31, 2018, the Company concluded the sale of its two hydroelectric plants in Goiás for R$ 835 million to Kinross Brasil Mineração, a wholly owned subsidiary of Kinross Gold Corporation. The Caçu and Barra dos Coqueiros plants were inaugurated in 2010. On October 31, 2018, the Company concluded the sale of its participation interest in Gerdau Hungria KFT Y CIA Sociedad Regular Colectiva, a subsidiary of the Company located in Spain and owner of 98,89% of Gerdau Steel India Ltd. shares, to Blue Coral Investment Holdings Pte. Ltd and Mountainpeak Investment Holdings Ltd.. The transaction perimeter involves 100% of the operations and assets in India, including the special steels industrial unit located in Tadipatri. The enterprise value of the transaction corresponds to US$ 120 million (equivalent to R$ 490.2 million on the signing date of the agreement). The transaction will enable Gerdau to focus more on managing its strategic assets in the Americas, where its key markets, Brazil and the United States, are located. On November 5, 2018, the Company concluded the sale of its four rebar-producing mills, as well as steel cutting and bending units and distribution centers in the United States to Commercial Metals. The agreement includes the Jacksonville (Florida), Knoxville (Tennessee), Rancho Cucamonga (California) and Sayreville (New Jersey), as well as all of Gerdau’s U.S. rebar fabrication facilities, presented within the North America Segment up to the conclusion of the sale. The enterprise value of the transaction is US$ 600 million (equivalent to R$ 2,222.9 million) as well as working capital adjustments. As a result of the transactions above, the Company recognized an expense of R$ 414.5 million in 2018 in the line of Gains and losses on assets held for sale and sales of interest in subsidiaries in its Income Statement.

CASH AND CASH EQUIVALENTS, AND

CASH AND CASH EQUIVALENTS, AND SHORT AND LONG-TERM INVESTMENTS	12 Months Ended
	Dec. 31, 2020
CASH AND CASH EQUIVALENTS, AND SHORT AND LONG-TERM INVESTMENTS
CASH AND CASH EQUIVALENTS, AND SHORT AND LONG-TERM INVESTMENTS	NOTE 4 — CASH AND CASH EQUIVALENTS, AND SHORT AND LONG-TERM INVESTMENTS 2020 2019 Cash 9,060 12,302 Banks and immediately available investments 4,608,144 2,629,350 Cash and cash equivalents 4,617,204 2,641,652 Immediately available investments include investments with maturity up to 90 days, immediate liquidity and low risk of fair value variation. 2020 2019 Short-term investments 3,041,143 3,652,949 Short-term investments include Bank Deposit Certificates and marketable securities, which are stated at their fair value. Income generated by these investments is recorded as financial income.

TRADE ACCOUNTS RECEIVABLE

TRADE ACCOUNTS RECEIVABLE	12 Months Ended
	Dec. 31, 2020
TRADE ACCOUNTS RECEIVABLE
TRADE ACCOUNTS RECEIVABLE	NOTE 5 — TRADE ACCOUNTS RECEIVABLE 2020 2019 Trade accounts receivable - in Brazil 2,081,740 1,193,971 Trade accounts receivable - exports from Brazil 26,121 117,274 Trade accounts receivable - outside of Brazil 1,766,555 1,459,204 (-) Impairment loss on trade receivables (137,146) 3,737,270 2,672,370 Accounts receivable by aging are as follows: 2020 2019 Current 3,466,000 2,226,121 Past-due: Up to 30 days 259,756 381,999 From 31 to 60 days 48,905 58,972 From 61 to 90 days 9,355 30,202 From 91 to 180 days 13,636 15,384 From 181 to 360 days 15,899 16,739 Above 360 days 60,865 41,032 (-) Impairment on financial assets (137,146) 3,737,270 2,672,370 The Company’s maximum exposure to credit risk, net of impairment on financial assets, is the amount of accounts receivable. The credit quality of accounts receivable to maturity is considered adequate, and the value of the effective risk of possible losses on accounts receivable from customers is presented as impairment on financial assets. The changes in the impairment on financial assets are as follows: Balance as of January 1, 2018 (179,702) Impairment on financial assets during the year (111,900) Recoveries in the year 101,986 Write-offs 39,943 Exchange variation (5,136) Assets held for sale (3,348) Balance as of December 31, 2018 (158,157) Impairment on financial assets during the year Recoveries in the year 60,199 Write-offs 78,635 Exchange variation 2,487 Balance as of December 31, 2019 Impairment on financial assets during the year Recoveries in the year 84,416 Write-offs 36,210 Exchange variation Balance as of December 31, 2020

INVENTORIES

INVENTORIES	12 Months Ended
	Dec. 31, 2020
INVENTORIES
INVENTORIES	NOTE 6 — INVENTORIES 2020 2019 Finished products 3,894,698 3,302,569 Work in progress 2,045,158 1,426,607 Raw materials 1,934,958 1,611,334 Storeroom supplies 786,401 974,412 Imports in transit 514,321 384,123 (-) Allowance for adjustments to net realizable value 9,169,417 7,659,737 The allowance for adjustment to net realizable value of inventories, on which the provision and write-offs are registered with impact on cost of sales, is as follows: Balance as of January 1, 2018 (3,556) Provision for the year (11,943) Reversal of adjustments to net realizable value 3,715 Exchange rate variation (871) Assets held for sale (1,049) Balance as of December 31, 2018 (13,704) Provision for the year Reversal of adjustments to net realizable value 22,028 Exchange rate variation Balance as of December 31, 2019 Provision for the year Reversal of adjustments to net realizable value 47,259 Exchange rate variation Balance as of December 31, 2020

TAX CREDITS

TAX CREDITS	12 Months Ended
	Dec. 31, 2020
TAX CREDITS
TAX CREDITS	NOTE 7 — TAX CREDITS 2020 2019 Current ICMS (state VAT) 297,926 279,483 Social security financing 632,927 104,704 Financing of social integration program 171,724 26,198 IPI (federal VAT) 38,174 26,173 IVA (value-added tax) 24,500 41,958 Others 36,061 25,786 1,201,312 504,302 Non-current ICMS (state VAT) 64,163 51,615 Social security financing 441,111 331,435 Financing of social integration program and Others 158,771 82,499 664,045 465,549 1,865,357 969,851 The estimates of realization of non-current tax credits are as follows: 2020 2019 2021 - 190,773 2022 584,145 106,271 2023 22,433 83,371 2024 8,054 65,000 2025 on 49,413 20,134 664,045 465,549

INCOME AND SOCIAL CONTRIBUTION

INCOME AND SOCIAL CONTRIBUTION TAXES	12 Months Ended
	Dec. 31, 2020
INCOME AND SOCIAL CONTRIBUTION TAXES
INCOME AND SOCIAL CONTRIBUTION TAXES	NOTE 8 — INCOME AND SOCIAL CONTRIBUTION TAXES In Brazil, income taxes include federal income tax (IR) and social contribution (CS), which represents an additional federal income tax. The statutory rates for income tax and social contribution are 25% and 9%, respectively, and are applicable for the years ended December 31, 2020, 2019 and 2018. The foreign subsidiaries of the Company are subject to taxation at rates ranging between 23% and 34%, without considering there are subsidiaries abroad with zero tax rate, which have mainly financial activities. The differences between the Brazilian tax rates and the rates of other countries are presented under “Difference in tax rates in foreign companies” in the reconciliation of income tax and social contribution below. a) Reconciliations of income and social contribution taxes at statutory rates to amounts presented in the Statement of Income are as follows: 2020 2019 2018 Income (loss) before income taxes 3,495,678 1,674,720 2,157,431 Statutory tax rates 34 % 34 % 34 % Income and social contribution taxes at statutory rates (1,188,531) (733,527) Tax adjustment with respect to: - Difference in tax rates in foreign companies 530,715 75,428 663,116 - Equity in earnings of unconsolidated companies 51,873 3,448 - Interest on equity* 98,739 69 128,418 - Tax credits and incentives 31,800 8,852 9,531 - Deferred tax assets not recognized (592,861) - - - Recognition of previously unrecognized tax losses 4,944 1,097 47,545 - Other permanent differences, net (44,303) 31,923 50,420 Income and social contribution taxes (1,107,624) 168,951 Current (908,051) (629,209) Deferred (199,573) 798,160 (*) Brazilian Law 9,249/95 provides that a company may, at its sole discretion, consider dividends distributions to shareholders to be considered as interest on own capital — subject to specific limitations - which has the effect of a taxable deduction in the determination of income tax and social contribution. The limitation is the greater of (i) shareholders’ equity multiplied by the TJLP (Long Term Interest Rate) rate or (ii) 50% of the net income in the fiscal year. This expense is not recognized for the purpose of preparing the financial statements and therefore does not impact net income. b) Breakdown and changes in deferred income and social contribution tax assets and liabilities at statutory tax rates: Balance as of Recognized in Acquisition of Comprehensive Balance as of December 31, 2019 income subsidiary Income December 31, 2020 Tax loss carryforward 1,341,464 - 36,228 1,220,485 Social contribution tax losses 350,810 - - 290,276 Provision for tax, civil and labor liabilities 242,794 140,871 - 1,798 385,463 Benefits granted to employees 294,031 - 105,074 392,257 Other temporary differences 575,719 - 40,022 501,114 Deferred exchange variance* 1,177,428 - (709) 1,057,541 Provision for losses 23,618 11,740 - 162 35,520 Fair value adjustments on businesses acquired (452,058) 106,210 3,553,806 63,652 3,331,792 Non-current assets 4,071,219 3,393,354 Non-current liabilities (517,413) * Corresponds to deferred taxes over foreign exchange gains and loss which certain subsidiaries elected to tax on a cash basis Balance as of Recognized in Comprehensive Balance as of December 31, 2018 income Others Income December 31, 2019 Tax loss carryforward 1,339,933 4,781 (36,226) 32,976 1,341,464 Social contribution tax losses 337,258 13,552 - - 350,810 Provision for tax, civil and labor liabilities 270,417 (27,848) - 225 242,794 Benefits granted to employees 286,494 (29,739) - 37,276 294,031 Other temporary differences 525,818 73,067 - (23,166) 575,719 Deferred exchange variance* 1,284,377 (106,640) - (309) 1,177,428 Provision for losses 83,837 (75,142) - 14,923 23,618 Fair value adjustments on businesses acquired (372,448) (69,464) - (10,146) (452,058) 3,755,686 (217,433) (36,226) 51,779 3,553,806 Non-current assets 3,874,054 4,071,219 Non-current liabilities (118,368) (517,413) * Balance as of Recognized in Comprehensive Balance as of January 1, 2018 income Others Income December 31, 2018 Tax loss carryforward 973,638 341,664 36,445 (11,814) 1,339,933 Social contribution tax losses 355,782 (18,524) - - 337,258 Provision for tax, civil and labor liabilities 275,463 (5,214) 168 - 270,417 Benefits granted to employees 282,803 (16,564) 67,184 (46,929) 286,494 Other temporary differences 410,300 93,094 17,177 5,247 525,818 Deferred exchange variance* 1,060,527 223,850 - - 1,284,377 Provision for losses 110,728 (33,165) (12) 6,286 83,837 Fair value adjustments on businesses acquired (497,534) 213,019 (89,859) 1,926 (372,448) 2,971,707 798,160 31,103 (45,284) 3,755,686 Non-current assets 3,054,393 3,874,054 Non-current liabilities (82,686) (118,368) * The recoverability analysis of deferred tax balances related to tax loss carryforward and social contribution tax losses performed by the Company are based on its business plans and aligned with other projections and analysis performed by the Company as, for example, the impairment of assets tests. c) Estimated recovery and reversal of income and social contribution tax assets and liabilities are as follows: Assets 2020 2019 2020 - 605,657 2021 616,409 467,153 2022 399,248 422,863 2023 391,610 464,514 2024 348,139 472,734 2025 and after 1,637,948 1,638,298 3,393,354 4,071,219 Liabilities 2020 2019 2021 (8,558) (98,449) 2022 (8,192) (110,031) 2023 (14,815) (90,703) 2024 (3,145) (79,022) 2025 and after (26,852) (139,208) (61,562) (517,413) d) Unrecognized deferred income tax assets: Due to the lack of expectation to use tax losses, negative social contribution base and deferred exchange variation arising from some operations in Brazil, the Company did not recognize a portion of tax assets of R$ 764,845 (R$ 263,491 on December 31, 2019), which do not have an expiration date. The subsidiaries abroad had R$ 1,180,067 (R$ 668,729 as of December 31, 2019) of tax credits on capital losses for which deferred tax assets have not been booked and which expire between 2029 and 2035 and also several tax losses of state credits in the amount of R$ 1,623,459 (R$ 1,384,598 as of December 31, 2019), which expire at various dates between 2021 and 2035.

INVESTMENTS IN ASSOCIATES AND J

INVESTMENTS IN ASSOCIATES AND JOINT VENTURES	12 Months Ended
	Dec. 31, 2020
INVESTMENTS IN ASSOCIATES AND JOINT VENTURES
INVESTMENTS IN ASSOCIATES AND JOINT VENTURES	NOTE 9 — INVESTMENTS IN ASSOCIATES AND JOINT VENTURES Investments in Investments in Investments in Investments in North America South America Special Steel Brazil Others Total Balance as of January 1, 2018 346,080 584,899 199,647 - 149,673 1,280,299 Equity in earnings (77,909) 51,648 15,629 (1,700) 22,473 10,141 Other comprehensive income 33,101 96,045 (1,377) (2,050) - 125,719 Capital increase - - - 7,000 - 7,000 Dividends/Interest on equity - (31,359) - - (23,998) (55,357) Balance as of December 31, 2018 301,272 701,233 213,899 3,250 148,148 1,367,802 Equity in earnings (111,637) 66,468 6,779 (828) 22,168 (17,050) Other comprehensive income 28,182 21,282 3,523 2,051 - 55,038 Capital increase 463,990 - - 7,000 - 470,990 Capital reduction - (20,344) (20,344) Dividends/Interest on equity - (20,247) - - (23,790) (44,037) Balance as of December 31, 2019 681,807 748,392 224,201 11,473 146,526 1,812,399 Equity in earnings 23,494 99,913 8,900 21,550 152,569 Other comprehensive income 165,479 195,286 - - 358,816 Capital increase 42,782 - - - - 42,782 Dividends/Interest on equity (5,223) - - Balance as of December 31, 2020 908,339 976,045 231,152 10,185 145,908 2,271,629

PROPERTY, PLANT AND EQUIPMENT

PROPERTY, PLANT AND EQUIPMENT	12 Months Ended
	Dec. 31, 2020
PROPERTY, PLANT AND EQUIPMENT
PROPERTY, PLANT AND EQUIPMENT	NOTE 10 — PROPERTY, PLANT AND EQUIPMENT a) Summary of changes in property, plant and equipment: Property, plant and Land and Machines, equipment, Data electronic equipment under Cost of the property, plant, and equipment buildings and installations equipment construction Other Total Balances as of January 1, 2018 9,085,698 28,016,604 711,638 950,680 1,175,697 39,940,317 Additions 13,739 66,764 11,811 983,519 119,101 1,194,934 Capitalized interest - - - 23,999 - 23,999 Transfers 140,334 802,664 457 (949,888) 6,433 - Disposals (45,290) (285,860) (5,641) (3,352) (9,606) (349,749) Transfer to assets held for sale (784,464) (749,425) (14,914) (49,579) (300,618) (1,899,000) Effects of IAS 29 adoption - 699,724 - - - 699,724 Foreign exchange effect 290,732 1,058,527 49,727 65,868 (2,893) 1,461,961 Balances as of December 31, 2018 8,700,749 29,608,998 753,078 1,021,247 988,114 41,072,186 Additions 28,449 76,756 13,955 1,506,343 121,097 1,746,600 Capitalized interest - - - 24,676 - 24,676 Transfers 115,452 884,161 24,037 (1,038,693) 15,043 - Disposals (54,699) (165,139) (1,890) (40,314) (105,643) (367,685) Foreign exchange effect 122,992 626,432 13,369 42,470 10,797 816,060 Balances as of December 31, 2019 8,912,943 31,031,208 802,549 1,515,729 1,029,408 43,291,837 Additions 50,848 98,372 9,765 1,369,947 121,846 1,650,778 Capitalized interest - - - 24,622 - 24,622 Transfers 207,551 695,512 13,653 (939,231) 22,515 - Disposals (226,920) (505,580) (11,487) - (144,153) (888,140) Business Combination (note 3.4) 275,076 173,453 29 36,563 1,636 486,757 Impairment of non-financial assets (note 30) (198,196) (213,729) - - - (411,925) Foreign exchange effect 918,554 3,621,233 107,634 246,575 47,285 4,941,281 Balances as of December 31, 2020 9,939,856 34,900,469 922,143 2,254,205 1,078,537 49,095,210 Property, plant and Land and Machines, equipment, Data electronic equipment under Accumulated depreciation buildings and installations equipment construction Other Total Balances as of January 1, 2018 (3,915,023) (18,576,836) (622,234) - (382,482) (23,496,575) Depreciation (291,315) (1,128,138) (34,814) - (130,611) (1,584,878) Transfers 18,341 5,234 158 - (23,733) - Disposals 29,944 258,609 2,609 - 7,970 299,132 Transfer to assets held for sale 105,787 286,204 11,667 - 234,271 637,929 Effects of IAS 29 adoption - (265,654) - - - (265,654) Foreign exchange effect (129,539) (946,240) (44,332) - 4,452 (1,115,659) Balances as of December 31, 2018 (4,181,805) (20,366,821) (686,946) - (290,133) (25,525,705) Depreciation (295,615) (1,136,040) (33,143) - (112,384) (1,577,182) Transfers - (20) - - 20 - Disposals 38,826 145,019 1,818 - 105,272 290,935 Foreign exchange effect (74,868) (483,549) (12,151) - (7,824) (578,392) Balances as of December 31, 2019 (4,513,462) (21,841,411) (730,422) - (305,049) (27,390,344) Depreciation - Disposals 223,174 497,434 11,169 - 128,833 860,610 Foreign exchange effect - Balances as of December 31, 2020 - Net property, plant and equipment Balances as of December 31, 2018 4,518,944 9,242,177 66,132 1,021,247 697,981 15,546,481 Balances as of December 31, 2019 4,399,481 9,189,797 72,127 1,515,729 724,359 15,901,493 Balances as of December 31, 2020 4,795,317 9,366,248 64,468 2,254,205 772,677 17,252,915 The average rate of capitalized interest in 2020 was 3.8% (6.0% in 2019 and 5.7% in 2018). The following useful lives are used to calculate depreciation: Useful lives of property, plant and equipment Buildings 10 to 33 years Machines, equipment, and installations 10 to 20 years Furniture and fixture 5 to 10 years Vehicles 3 to 5 years Data electronic equipment 2.5 to 6 years b) Guarantees — property, plant and equipment have been pledged as collateral for loans and financing in the amount of R$ 0 as of December 31, 2020 (R$ 0 and R$ 90,463 as of December 31, 2019 and 2018, respectively). c) Impairment of property, plant and equipment — At December 31, 2020, the carrying amount of items of property, plant and equipment for which an impairment loss has been recognized up to current year is R$ 345,087 for land, buildings and construction (R$ 124,761 as of December 31, 2019), R$ 710,476 for machines, equipment and installations (R$ 504,287 as of December 31, 2019), R$ 543,726 for Property, plant and equipment under construction (R$ 543,726 as of December 31, 2019).

GOODWILL

GOODWILL	12 Months Ended
	Dec. 31, 2020
GOODWILL
GOODWILL	NOTE 11 — GOODWILL The changes in goodwill are as follows: Accumulated Goodwill after Goodwill impairment losses Impairment losses Balance as of January 1, 2018 14,500,381 (6,609,239) 7,891,142 (+/-) Foreign exchange effect 2,283,577 (1,062,329) 1,221,248 Balance as of December 31, 2018 16,783,958 (7,671,568) 9,112,390 (+/-) Foreign exchange effect 661,247 356,921 Balance as of December 31, 2019 17,445,205 9,469,311 (+/-) Foreign exchange effect 4,976,383 2,634,208 Balance as of December 31, 2020 22,421,588 12,103,519 The amounts of goodwill by segment are as follows: 2020 2019 2018 Brazil 373,135 373,135 373,135 Special Steel 3,828,841 2,969,752 2,854,888 North America 7,901,543 6,126,424 5,884,367 12,103,519 9,469,311 9,112,390

INTANGIBLE ASSETS

INTANGIBLE ASSETS	12 Months Ended
	Dec. 31, 2020
INTANGIBLE ASSETS
INTANGIBLE ASSETS	NOTE 12 — INTANGIBLE ASSETS Intangible assets consist mainly of relationships recognized upon business combinations and software development, with application in the management of the business: Customer Supplier Software contracts and relationships development relationships Others Total Balance as of January 01, 2018 32,786 490,829 440,774 7,700 972,089 Foreign exchange effect - 28,598 77,593 1,243 107,434 Acquisition - 67,388 - - 67,388 Disposal - (3,791) (88) - (3,879) Amortization (6,067) (167,384) (130,980) (2,505) (306,936) Balance as of December 31, 2018 26,719 415,640 387,299 6,438 836,096 Foreign exchange effect - 6,137 12,586 472 19,195 Acquisition - 100,313 - - 100,313 Amortization (5,304) (157,278) (116,462) (3,298) (282,342) Balance as of December 31, 2019 21,415 364,812 283,423 3,612 673,262 Foreign exchange effect - 42,890 83,806 1,074 127,770 Acquisition - 154,250 - - 154,250 Amortization (4,637) (188,083) (136,525) (3,459) (332,704) Balance as of December 31, 2020 16,778 373,869 230,704 1,227 622,578 Estimated useful lives 5 to 20 years 7 years 5 to 20 years 5 years The composition of other intangible assets by segment is as follows: 2020 2019 2018 Brazil 220,303 238,243 295,107 Special Steel 156,557 132,934 136,910 South America 1,534 1,729 1,441 North America 244,184 300,356 402,638 622,578 673,262 836,096

LEASING

LEASING	12 Months Ended
	Dec. 31, 2020
LEASING
LEASING	NOTE 13 — LEASING a) Summary of changes in the Right-of-use assets: Machines, equipment, Data electronic Right-of-use Cost Land and buildings and installations equipment Others Total Balances as of January 1, 2019 243,250 436,401 106,787 49,930 836,368 Additions 14,062 117,653 742 11,064 143,521 Disposals (10,493) (22,993) (162) (1,907) (35,555) Remeasurements 33,322 (2,346) - 1,236 32,212 Foreign exchange effect 3,853 4,571 46 2,119 10,589 Balances as of December 31, 2019 283,994 533,286 107,413 62,442 987,135 Additions 5,670 185,116 175 43,862 234,823 Disposals - Remeasurements 111 12,548 69 9,693 Foreign exchange effect 26,748 37,809 340 15,747 80,644 Balances as of December 31, 2020 301,940 738,330 120,476 120,944 1,281,690 Machines, equipment, Data electronic Accumulated depreciation Land and buildings and installations equipment Others Total Balances as of January 1, 2019 - - - - - Depreciation (50,080) (127,399) (15,419) (21,873) (214,771) Disposals 1,330 4,250 32 976 6,588 Foreign exchange effect (733) (128) (9) (768) (1,638) Balances as of December 31, 2019 (49,483) (123,277) (15,396) (21,665) (209,821) Depreciation Disposals 8,601 13,453 - 1,027 23,081 Foreign exchange effect Balances as of December 31, 2020 b) Leasing payable: Leasing payments are presented in the Statement of Cash Flow. The liabilities presented in the Balance Sheet are adjusted to present value, based on risk-free interest rates observed in each country where the Company has operations, adjusted by the Company's credit spread, where on December 31, 2020 the discount rates were between 3.7% p.a. to 10.8% p.a. (5.1% p.a. to 10.8% p.a. in December 31, 2019), varying according to the country and duration of the lease. The payment schedules of leasing are as follows: 2020 2019 2020 - 202,536 2021 231,703 172,870 2022 193,314 121,379 2023 140,019 85,878 2024 90,812 58,866 2025 on 200,626 162,740 856,474 804,269 Leasing payable Current 231,703 202,536 Non-current 624,771 601,733 Financial expense for the year ended on December 31, 2020 and 2019 61,727 83,620

TRADE ACCOUNTS PAYABLE

TRADE ACCOUNTS PAYABLE	12 Months Ended
	Dec. 31, 2020
TRADE ACCOUNTS PAYABLE
TRADE ACCOUNTS PAYABLE	NOTE 14 – TRADE ACCOUNTS PAYABLE 2020 2019 Trade accounts payable - domestic market 3,941,924 2,701,246 Trade accounts payable - debtor risk 726,045 376,093 Trade accounts payable - intercompany 8,958 4,283 Trade accounts payable - imports 761,026 681,146 5,437,953 3,762,768 The Company has contracts with financial institutions in order to allow its suppliers to receive in advance their receivables through an operation called "Trade accounts payable - debtor risk". In this operation, the suppliers transfer the right to receive their receivables to a financial institution, which in turn, becomes the holder of the rights to the suppliers' receivables. The Company constantly monitors the composition of the portfolio and the conditions established with its suppliers, which have not resulted in significant changes in relation to what had been practiced historically.

SHORT-TERM DEBT AND LONG-TERM D

SHORT-TERM DEBT AND LONG-TERM DEBT	12 Months Ended
	Dec. 31, 2020
SHORT-TERM DEBT AND LONG-TERM DEBT
SHORT-TERM DEBT AND LONG-TERM DEBT	NOTE 15 – SHORT-TERM DEBT AND LONG-TERM DEBT Short-term debt and long-term debt are as follows: Annual charges (*) 2020 2019 Working capital 1,178,557 107,312 Financing of property, plant and equipment and others 333,797 843,099 Ten/Thirty Year Bonds 13,100,580 12,188,412 Total Loans and Financing 14,612,934 13,138,823 Current 1,424,043 1,544,211 Non-current 13,188,891 11,594,612 Principal amount of loans and Financing 14,413,188 12,958,565 Interest accrued of loans and Financing 199,746 180,258 Total 14,612,934 13,138,823 (*) Loans and financing denominated in Brazilian reais are indexed to fixed rates or CDI (Interbank Deposit Certificate). Summary of loans and financing by currency: 2020 2019 Brazilian Real (BRL) 1,245,988 111,492 U.S. Dollar (USD) 13,366,946 12,960,521 Other currencies - 66,810 14,612,934 13,138,823 The amortization schedules of long-term loans and financing are as follows: 2020 2019 2021 - 1,221,361 2022 5,210 105,137 2023 2,108,324 1,243,774 2024 1,813,225 1,531,163 2025 682,422 1,642,664 2026 on 8,579,710 5,850,513 13,188,891 11,594,612 a) Credit Lines In October 2019, the Company completed the renewal of the Global Credit Line in the total amount of US$ 800 million (equivalent to R$ 4,157 million as of December 31, 2020). The transaction aims to provide liquidity to subsidiaries in North America and Latin America, including Brazil. The companies Gerdau S.A., Gerdau Açominas S.A. and Gerdau Aços Longos S.A. provide guarantee for this transaction, which matures in October 2024. As of December 31, 2020, the outstanding balance of this credit facility was US$ 40 million (equivalent to R$ 207 million as of December 31, 2020). b) Main funding in 2020 During the 4 th quarter of 2020, the subsidiaries Gerdau Aços Longos and Gerdau Açominas obtained long-term working capital loans in BRL from top-tier institutions. The proceeds were used to settle the bond repurchase offer, which totaled principal amount of US$ 300 million. As of December 31, 2020, the outstanding balance related to these bilateral operations is R$ 1,175 million.

DEBENTURES

DEBENTURES	12 Months Ended
	Dec. 31, 2020
DEBENTURES
DEBENTURES	NOTE 16 — DEBENTURES General Quantity as of December 31, 2020 Issuance Meeting Issued Held in treasury Maturity 2020 2019 14th August 26, 2014 20,000 20,000 August 30, 2024 - - 15th November 09, 2018 1,500,000 - November 21, 2022 1,500,985 1,504,436 16th - A April 25, 2019 600,000 - May 6, 2023 600,759 602,847 16th - B April 25, 2019 800,000 - May 6, 2026 800,673 803,761 Total Consolidated 2,902,417 2,911,044 Current 7,463 18,015 Non-current 2,894,954 2,893,029 The amortization schedules of long-term debentures are as follows: 2020 2019 2022 1,497,760 1,496,591 2023 598,960 598,530 2027 on 798,234 797,908 2,894,954 2,893,029 The debentures are denominated in Brazilian Reais, nonconvertible, and pay variable interest as a percentage of the CDI – Interbank Deposit Certificate. The average interest rate was 2.90% for the year ended on December 31, 2020 (6.18% for the year ended on December 31, 2019).

FINANCIAL INSTRUMENTS

FINANCIAL INSTRUMENTS	12 Months Ended
	Dec. 31, 2020
FINANCIAL INSTRUMENTS
FINANCIAL INSTRUMENTS	NOTE 17 — FINANCIAL INSTRUMENTS a) General considerations - Gerdau S.A. and its subsidiaries enter into transactions with financial instruments whose risks are managed by means of strategies and exposure limit controls. All financial instruments are recorded in the accounting books and presented as short-term investments, loans and financing, debentures, related-party transactions, fair value of derivatives, obligations with FIDC, other current assets, other non-current assets, other current liabilities and other non-current liabilities. The Company uses derivative and non-derivative instruments as hedges for certain transactions and applies the hedge accounting methodology for some of these transactions. These operations are intended to protect the Company against changes in the exchange rates of loans denominated in foreign currency and fluctuations in interest rates. These transactions are carried out considering direct active or passive exposures, without leverage. b) Market value — the market value of the aforementioned financial instruments is as follows: 2020 2019 Book Fair Book Fair value value value value Assets Short-term investments 3,041,143 3,041,143 3,652,949 3,652,949 Related parties 134,354 134,354 95,445 95,445 Fair value of derivatives - - 2,846 2,846 Other current assets 591,523 591,523 618,769 618,769 Other non-current assets 590,864 590,864 464,169 464,169 Liabilities Loans and Financing 14,612,934 17,014,948 13,138,823 14,288,142 Debentures 2,902,417 2,775,619 2,911,044 2,864,950 Related parties 22,855 22,855 - - Fair value of derivatives 971 971 - - Obligations with FIDC 987,406 987,406 1,018,501 1,018,501 Other current liabilities 797,082 797,082 666,858 666,858 Other non-current liabilities 514,886 514,886 449,375 449,375 The fair values of Loans and Financing and Debentures are based on market premises, which may take into consideration discounted cash flows using equivalent market rates and credit rating. All other financial instruments, which are recognized in the Consolidated Financial Statements at their carrying amount, are substantially similar to those that would be obtained if they were traded in the market. However, because there is no active market for these instruments, differences could exist if they were settled in advance. The fair value hierarchy of the financial instruments above are presented in Note 17.g. c) Risk factors that could affect the Company’s and its subsidiaries’ businesses: Price risk of commodities: this risk is related to the possibility of changes in prices of the products sold by the Company or in prices of raw materials and other inputs used in the productive process. Since the Company operates in a commodity market, net sales and cost of sales may be affected by changes in the international prices of their products or materials. In order to minimize this risk, the Company constantly monitors the price variations in the domestic and international markets. Interest rate risk: this risk arises from the possibility of losses (or gains) due to fluctuations in interest rates applied to the Company’s financial liabilities or assets and future cash flows and income. The Company evaluates its exposure to these risks: (i) comparing financial assets and liabilities denominated at fixed and floating interest rates and (ii) monitoring the variations of interest rates like Libor and CDI. Accordingly, the Company may enter into interest rate swaps in order to reduce this risk. Exchange rate risk: this risk is related to the possibility of fluctuations in exchange rates affecting the amounts of financial assets or liabilities or of future cash flows and income. The Company assesses its exposure to the exchange rate by measuring the difference between the amount of its assets and liabilities in foreign currency. The Company understands that the accounts receivables originated from exports, its cash and cash equivalents denominated in foreign currencies and its investments abroad are more than equivalent to its liabilities denominated in foreign currency. Since the management of these exposures occurs at each operation level, if there is a mismatch between assets and liabilities denominated in foreign currency, the Company may employ derivative financial instruments in order to mitigate the effect of exchange rate fluctuations. Due to the current market condition, especially due to the pandemic caused by the COVID-19, the Brazilian Real has experienced a devaluation in relation to the quotation of other currencies, mainly the US Dollar. On December 31, 2020, the quotation of the US Dollar against the Brazilian Real was US$ 1.00 = R$ 5.1967 (R$ 4.0307 on December 31, 2019), registering a devaluation of the Brazilian Real of approximately 22.44%. Credit risk: this risk arises from the possibility of the Company not receiving amounts arising from sales to customers or investments made with financial institutions. In order to minimize this risk, the Company adopt the procedure of analyzing in details of the financial position of their customers, establishing a credit limit and constantly monitoring their balances. Regarding short-term investments, the Company invests solely in financial institutions with low credit risk, as assessed by rating agencies. In addition, each financial institution has a maximum limit for investment, determined by the Company’s Credit Committee. Capital management risk : this risk comes from the Company’s choice in adopting a financing structure for its operations. The Company manages its capital structure, which consists of a ratio between the financial debts and its own capital (Equity) based on internal policies and benchmarks. The Key Performance Indicators (KPI) related to the “Capital Structure Management” objective are: WACC (Weighted Average Cost of Capital), Net Debt/EBITDA (Earnings before interest, income tax, depreciation and amortization), Coverage Ratio of Net Financial Expenses (EBITDA/Net Financial Expenses) and Debt/Total Capitalization Ratio. Interest for EBITDA purposes is formed by the net finance cost. Net Debt is formed by the principal of the debt reduced by cash, cash equivalents and short-term investments (notes 4, 15 and 16). Total Capitalization is formed by the Total Debt (composed of the principal of the debt) and the Equity (Note 24). The Company may change its capital structure, according to economic and financial conditions, in order to optimize its financial leverage and debt management. At the same time, the Company seeks to improve its ROCE (Return on Capital Employed) through the implementation of working capital management and an efficient program of investments in property, plant and equipment. In the long term, the Company seeks to remain within the parameters below, admitting occasional variations in the short term: Net debt/EBITDA From 1.0 to 1.5 times Gross debt limit R$ 12 billion Average maturity more than 6 years However, changes that deteriorate the economic and business environment, or relevant changes in the economy or financial market that result in increased risk perception or reduced liquidity and refinancing capacity, including those arising from the pandemic caused by the COVID-19, if they are manifested in a greater intensity than anticipated in the scenarios contemplated by the Management, they can cause the Company to revise its projections. These key indicators are used to monitor objectives described above and may not necessarily be used as indicators for other purposes, such as impairment tests. Liquidity risk: The Company’s management policy of indebtedness and cash on hand is based on using the committed lines and the currently available credit lines with or without a guarantee in export receivables for maintaining adequate levels of short, medium, and long-term liquidity. The maturity of long-term loans and financing, and debentures are presented in Notes 15 and 16, respectively. 2020 Contractual obligations Total Less than 1 year 1-3 years 4-5 years More than 5 years Trade accounts payable 5,437,953 5,437,953 - - - Loans and financing 21,962,204 2,131,402 3,465,577 3,531,312 12,833,913 Debentures 3,077,960 66,145 2,174,184 32,604 805,027 Related parties 22,855 - - - 22,855 Obligations with FIDC 987,406 944,513 42,893 - - Other current liabilities 797,082 797,082 - - - Other non-current liabilities 514,886 - 41,805 - 473,081 32,800,346 9,377,095 5,724,459 3,563,916 14,134,876 2019 Contractual obligations Total Less than 1 year 1-3 years 4-5 years More than 5 years Trade accounts payable 3,762,768 3,762,768 - - - Loans and financing 20,061,659 2,312,877 2,659,844 3,793,164 11,295,774 Debentures 3,457,033 152,928 1,764,003 686,732 853,370 Obligations with FIDC 1,018,501 - - - 1,018,501 Other current liabilities 666,858 666,858 - - - Other non-current liabilities 449,375 - 20,079 - 429,296 29,416,194 6,895,431 4,443,926 4,479,896 13,596,941 Sensitivity analysis: The Company performed a sensitivity analysis, which can be summarized as follows: Impacts on Statements of Income Assumptions Percentage of change 2020 2019 Foreign currency sensitivity analysis 15,057 112,355 Interest rate sensitivity analysis 10 bps 85,147 70,891 Sensitivity analysis of changes in prices of products sold 438,147 396,440 Sensitivity analysis of changes in raw material and commodity prices 269,454 258,906 Sensitivity analysis of Swap of interest rate 50bps - 408 Sensitivity analysis of NDF (Non Deliverable Forwards) 3,703 - Foreign currency sensitivity analysis: As of December 31, 2020, the Company is mainly exposed to variations between the Real and the Dollar. The sensitivity analysis carried out by the Company considers the effects of a 5% increase or reduction between the Real and the Dollar in its non-hedged debt. In this analysis, if the Real appreciates against the Dollar, this would represent a gain of R$ 15,047 after the effects arising from the changes in the net investment hedge described in note 17.f - (R$ 112,355 as of December 31, 2019, respectively). If the Real depreciates against the Dollar this would represent an expense of the same value. Due to the net investment hedge, the variations are minimized when the exchange variation accounts, and income tax are analyzed. The net amounts of trade accounts receivable and trade accounts payable denominated in foreign currency do not represent any relevant risk in the case of any fluctuation of exchange rates. Interest rate sensitivity analysis: The interest rate sensitivity analysis made by the Company considers the effects of an increase or reduction of 10 basis point (bps) on the average interest rate applicable to the floating part of its debt. The calculated impact, considering this variation in the interest rate totals R$ 85,147 as of December 31, 2020 (R$ 70,891 as of December 31, 2019) and would impact the Financial expenses account in the Consolidated Statements of Income. The specific interest rates to which the Company is exposed are related to the loans, financing, and debentures presented in Notes 15 and 16, and are mainly comprised by Libor and CDI — Interbank Deposit Certificate. Sensitivity analysis of changes in sales price of products and price of raw materials and other inputs used in production: The Company is exposed to changes in the price of its products. This exposure is associated with the fluctuation of the sale price of the Company’s products and the price of raw materials and other inputs used in the production process, mainly for operating in a commodity market. The sensitivity analysis made by the Company considers the effects of an increase or of a reduction of 1% on both prices. The impact measured considering this variation in the price of products sold, considering the revenues and costs of the year ended on December 31, 2020, totals R$ 438,147 (R$ 396,440 as of December 31, 2019) and the variation in the price of raw materials and other inputs totals R$ 269,454 as of December 31, 2020 (R$ 258,903 as of December 31, 2019). The impact in the price of products sold and raw materials would be recorded in the accounts Net Sales and Cost of Sales, respectively, in the Consolidated Statements of Income. The Company does not expect to be more vulnerable to a change in one or more specific product or raw material. Sensitivity analysis of interest rate swaps: The Company has exposure to interest rate swaps for some of its loans and financing. The sensitivity analysis calculated by the Company considers the effects of either an increase or a decrease of 50 bps in the interest curve for Pre x DI operations. These variations represent an income or expense of R$ 0 (R$ 408 as of December 31, 2019). These effects would be recognized in the Consolidated Income Statement. Sensitivity analysis of Currency forward contracts: The Company has exposure to dollar forward contracts for some of its assets and liabilities. The sensitivity analysis carried out by the Company considers the effects of an increase or decrease of 5% of the Dollar against the Argentine Peso, and its effects on the mark-to-market of these derivatives. An increase of 5% of the Dollar against the Argentine Peso represents gain of R$ 3,703 (R$ 0 on December 31, 2019), and a 5% reduction of the Dollar against the Argentine Peso represents an expense in the same amount. Dollar / Argentine Peso forward contracts were intended to hedge dollar and asset positions and the effects of mark-to-market on these contracts were recorded in the Consolidated Income Statement. Dollar forward contracts to which the Company is exposed are presented in note 17.e. d) Financial Instruments per Category Summary of the financial instruments per category: Financial asset at fair Financial asset at fair 2020 Financial asset at value through proft or value through other Assets amortized cost loss comprehensive income Total Short-term investments - 3,041,143 - 3,041,143 Related parties 134,354 - - 134,354 Other current assets 591,523 - - 591,523 Other non-current assets 530,864 60,000 - 590,864 Total 1,256,741 3,101,143 - 4,357,884 Financial income (expenses) 487,631 109,396 - 597,027 Financial liability at fair value through profit or Financial liability at Liabilities loss amortized cost Total Loans and financing - 14,612,934 14,612,934 Debentures - 2,902,417 2,902,417 Related parties - 22,855 22,855 Obligations with FIDC (current liabilities) - 944,513 944,513 Other current liabilities - 797,082 797,082 Obligations with FIDC (non-current liabilities) 42,893 42,893 Other non-current liabilities - 514,886 514,886 Fair value of derivatives 971 - 971 Total 971 19,837,580 19,838,551 Financial income (expenses) (1,632) (2,294,102) (2,295,734) Financial asset at fair Financial asset at fair 2019 Financial asset at value through proft or value through other Assets amortized cost loss comprehensive income Total Short-term investments - 3,652,949 - 3,652,949 Fair value of derivatives - - 2,846 2,846 Related parties 95,445 - - 95,445 Other current assets 618,769 - - 618,769 Other non-current assets 464,169 - - 464,169 Total 1,178,383 3,652,949 2,846 4,834,178 Financial income (expenses) 279,843 92,759 - 372,602 Financial liability at fair value through profit or Financial liability at Liabilities loss amortized cost Total Loans and financings - 13,138,823 13,138,823 Debentures - 2,911,044 2,911,044 Obligations with FIDC - 1,018,501 1,018,501 Other current liabilities - 666,858 666,858 Other non-current liabilities - 449,375 449,375 Total - 18,184,601 18,184,601 Financial income (expenses) (20,636) On December 31, 2020, the Company has derivative financial instruments such as interest rate and currency swaps. The other derivative financial instruments had their losses and/or realized and unrealized gains presented in the account gains (losses) with financial instruments, net in the Consolidated Statement of Income. e) Operations with derivative financial instruments Risk management objectives and strategies: In order to execute its strategy of sustainable growth, the Company implements risk management strategies in order to mitigate market risks. The objective of derivative transactions is always related to mitigating market risks as stated in our policies and guidelines. The monitoring of the effects of these transactions is performed monthly by the Financial Risk Management Committee, which validates the mark to market of these transactions. All derivative financial instruments are recognized at fair value in the Consolidated Financial Statements of the Company. Policy for use of derivatives: The Company is exposed to various market risks, including changes in exchange rates, commodities prices and interest rates. The Company uses derivatives and other financial instruments to reduce the impact of such risks on the fair value of its assets and liabilities or in future cash flows and income. The Company has established policies to evaluate the market risks and to approve the use of derivative transactions related to these risks. The Company enters into derivative financial instruments solely to manage the market risks mentioned above and never for speculative purposes. Derivative financial instruments are used only when they have a related position (asset or liability exposure) resulting from business operations, investments and financing. Policy for determining fair value: the fair value of derivative financial instruments is determined using models and other valuation techniques, including future prices and market curves. Derivative transactions may include: interest rate and/or currency swaps, currency futures contracts and currency options contracts. Swap Contracts: The Company has contracted Pre x DI swap operation, through which it receives a fixed interest rate and pays a floating interest rate, both in local currency. The counterparties to these operations are always highly rated financial institutions with low credit risk. Currency forward contracts: The Company contracted forward contract operations, through which it receives a fixed dollar amount and pays a fixed Argentine peso amount, both in local currency. Counterparties are always highly rated financial institutions with low credit risk. The derivatives instruments can be summarized and categorized as follows: Notional value Amount receivable Amount payable Contracts Position 2020 2019 2020 2019 2020 2019 Swap of interest rate Maturity in 2020 CDI 111.50% - R$ 50.0 million - 2,846 - - Swap of interest rate Maturity in 2021 buyed in US$ US$ 9.9 milion - - - (971) - Total fair value of financial instruments - 2,846 (971) - Fair value of derivatives 2020 2019 Current assets - 2,846 - 2,846 Fair value of derivatives Current liabilities 971 - 971 - 2020 2019 Net Income Gains on financial instruments 858 5,518 Losses on financial instruments (1,632) (20,636) (774) (15,118) Other comprehensive income (Losses) Gains on financial instruments (1,972) 3,502 (1,972) 3,502 f) Net investment hedge The Company designated as hedge of part of its net investments in subsidiaries abroad the operations of Ten/Thirty Years Bonds. As a consequence, the effect of exchange rate changes on debts in the amount of US$ 2.1 billion (designated as hedges) is recognized in the Statement of Comprehensive Income. The Company demonstrated effectiveness of the hedge as of its designation dates and demonstrated the high effectiveness of the hedge from the contracting of each debt for the acquisition of these companies abroad, whose effects were measured and recognized directly in the Statement of Comprehensive Income as an unrealized loss, net of taxes, in the amount R$ 2,504,914 and R$ 322,948 as of December 31, 2020 and December 31,2019, respectively. The objective of the hedge is to protect, during the existence of the debt, the amount of part of the Company’s investment in the subsidiaries abroad mentioned above against positive and negative changes in the exchange rate. This objective is consistent with the Company’s risk management strategy. Prospective and retrospective tests demonstrated the effectiveness of these instruments. g) Measurement of fair value: IFRS defines fair value as the amount for which an asset could be exchanged, or a liability settled, between knowledgeable, willing parties in an arm’s length transaction. The standard also establishes a three-level hierarchy for the fair value, which prioritizes information when measuring the fair value by the Company, to maximize the use of observable information and minimize the use of non-observable information. This IFRS describes the three levels of information to be used to measure fair value: Level 1 - quoted prices (unadjusted) in active markets for identical assets and liabilities. Level 2 - Inputs other than quoted prices included in Level 1 available, where (unadjusted) quoted prices are for similar assets and liabilities in non-active markets, or other data that is available or may be corroborated by market data for substantially the full term of the asset or liability. Level 3 - Inputs for the asset or liability that are not based on observable market data, because market activity is insignificant or does not exist. As of December 31, 2020, the Company had some assets which the fair value measurement is required on a recurring basis. These assets include investments in private securities and derivative instruments. Financial assets and liabilities of the Company, measured at fair value on a recurring basis and subject to disclosure requirements of IFRS 7 as of December 31, 2020 and December 31, 2019, are as follows: Fair Value Measurements at Reporting Date Using Quoted Prices in Non-Active Markets for Similar Assets Balance per financial statements (Level 2) 2020 2019 2020 2019 Current assets Short-term investments 3,041,143 3,652,949 3,041,143 3,652,949 Fair value of derivatives - 2,846 - 2,846 Other current assets 591,523 618,769 591,523 618,769 Non-current assets Related parties 134,354 95,445 134,354 95,445 Other non-current assets 590,864 464,169 590,864 464,169 4,357,884 4,834,178 4,357,884 4,834,178 Current liabilities Short-term debt 1,424,043 1,544,211 1,424,043 1,544,211 Debentures 7,463 18,015 7,463 18,015 Fair value of derivatives 971 - 971 - Obligations with FIDC 944,513 - 944,513 - Other current liabilities 797,082 666,858 797,082 666,858 Non-current liabilities Long-term debt 13,188,891 11,594,612 13,188,891 11,594,612 Debentures 2,894,954 2,893,029 2,894,954 2,893,029 Related parties 22,855 - 22,855 - Obligations with FIDC 42,893 1,018,501 42,893 1,018,501 Other non-current liabilities 514,886 449,375 514,886 449,375 19,838,551 18,184,601 19,838,551 18,184,601 h) Changes in liabilities from Cash flow from financing activities: As required by IAS 7, the Company has summarized below the changes in the liabilities of cash flow from financing activities, from its Statement of Cash Flows: Cash transactions Non cash transactions Interest expense on loans and Interest on Balances as of Proceeds/(Repayment) Interest paid on loans with related Exchange variation Balances as of December 31, 2019 from financing activities loans and financing parties and others December 31, 2020 Related parties, net (95,445) (7,777) - (8,277) - (111,499) Leasing payable 804,269 (247,914) (61,727) 61,727 300,119 856,474 Debt, Debentures and Losses/Gains on financial instruments, net - Derivative instruments 16,047,021 (1,963,283) (1,079,981) 1,022,460 3,490,105 17,516,322 Cash transactions Non cash transactions Interest expense on loans and Interest on Balances as of Proceeds/(Repayment) Interest paid on loans with related Exchange variation Balances as of December 31, 2018 from financing activities loans and financing parties and others December 31, 2019 Related parties, net (26,589) (64,089) - (4,767) - (95,445) Leasing payable 836,368 (161,824) (83,620) 83,620 129,725 804,269 Debt, Debentures and Losses/Gains on financial instruments, net - Derivative instruments 14,878,542 700,490 (945,027) 938,120 474,896 16,047,021 Cash transactions Non cash transactions Exchange variation, Interest expense on operations with loans and Interest on subsidiaries and Balances as of Proceeds/(Repayment) Interest paid on loans with related associate company and Balances as of January 01, 2018 from financing activities loans and financing parties others December 31, 2018 Related parties, net (51,839) 25,755 - (545) 40 (26,589) Debt, Debentures and Losses/Gains on financial instruments, net - Derivative instruments 16,510,851 (3,439,644) (1,162,364) 1,177,686 1,792,013 14,878,542

TAXES PAYABLE

TAXES PAYABLE	12 Months Ended
	Dec. 31, 2020
TAXES PAYABLE
TAXES PAYABLE	NOTE 18 — TAXES PAYABLE 2020 2019 Payroll charges 100,301 75,385 ICMS (state VAT) 99,430 47,244 COFINS (tax on revenue) 51,444 6,654 IPI (federal VAT) 38,153 13,252 IVA (value-added tax) and others 310,761 290,453 600,089 432,988

TAX, CIVIL AND LABOR CLAIMS AND

TAX, CIVIL AND LABOR CLAIMS AND CONTINGENT ASSETS	12 Months Ended
	Dec. 31, 2020
TAX, CIVIL AND LABOR CLAIMS AND CONTINGENT ASSETS
TAX, CIVIL AND LABOR CLAIMS AND CONTINGENT ASSETS	NOTE 19 — TAX, CIVIL AND LABOR CLAIMS AND CONTINGENT ASSETS The Company and its subsidiaries are party in judicial and administrative proceedings involving labor, civil and tax matters. Based on the opinion of its legal advisors, Management believes that the provisions recorded for these judicial and administrative proceedings is sufficient to cover probable and reasonably estimable losses from unfavorable court decisions and that the final decisions will not have significant effects on the financial position, operational results and liquidity of the Company and its subsidiaries. For claims whose expected loss is considered probable, the provisions have been recorded considering the judgment of the Management of the Company with the assistance of its legal advisors and the provisions are considered enough to cover expected probable losses. The balances of provisions are as follows: I) Provisions 2020 2019 a) Tax provisions 706,104 396,821 b) Labor provisions 428,821 357,130 c) Civil provisions 37,586 55,348 1,172,511 809,299 a) Tax Provisions Tax provisions refer mainly to discussions related to ICMS, IPI, social security contributions, offsetting of PIS and COFINS credits and incidence of PIS and COFINS on other revenues. b) Labor Provisions The Company is party to a group of individual and collective labor and/or administrative lawsuits involving various labor amounts and the provision arises from unfavorable decisions and/or the probability of loss in the ordinary course of proceedings with the expectation of outflow of financial resources by the Company. c) Civil Provisions The Company is party to a group of civil, arbitration and/or administrative lawsuits involving various claims and the provision arises from unfavorable decisions and/or probable losses in the ordinary course of proceedings with the expectation of outflow of financial resources for the Company. The changes in the tax, labor and civil provisions are shown below: 2020 2019 2018 Balance at the beginning of the year 809,299 770,305 827,883 (+) Additions 559,513 249,868 177,684 (+) Monetary correction 104,473 70,788 85,626 (-) Reversal of accrued amounts (304,678) (282,239) (319,719) (+) Foreign exchange effect on provisions in foreign currency 3,904 577 (1,169) Balance at the end of the year 1,172,511 809,299 770,305 II) Contingent liabilities for which provisions were not recorded Considering the opinion of legal advisors and management’s assessment, contingencies listed below have the probability of loss considered as possible (but not likely) and due to this classification, accruals have not been made in accordance with IFRS. a) Tax contingencies a.1) The Company and its subsidiaries Gerdau Aços Longos S.A. and Gerdau Açominas S.A. have lawsuits related to the ICMS (state VAT) which are mostly related to credit rights and rate differences, whose demands totaled R$ 458,801. a.2) The Company and certain of its subsidiaries in Brazil are parties to claims related to: (i) Imposto sobre Produtos Industrializados - IPI, substantially related to IPI credit on inputs, whose demands total the updated amount of R$ 357,974; (ii) PIS and COFINS, substantially related to disallowance of credits on inputs totaling R$ 1,016,764, (iii) social security contributions in the total of R$ 138,369 and (iv) other taxes, whose updated total amount is currently R$ 614,647. a.3) The Company and its subsidiary Gerdau Aços Longos SA are parties to administrative proceedings related to Withholding Income Tax, levied on interest remitted abroad, linked to export financing formalized through "Prepayment of Exports Agreements "(PPE) or” Advance Export Receipt "(RAE), in the updated amount of R$ 1,256,016, of which: (i) R$ 130,047 corresponds to a lawsuit of the subsidiary Gerdau Aços Longos, which had its Voluntary Appeal judged at the first instance of the Administrative Tax Appeals Council (CARF), which was dismissed by the quality vote, and Special Appeal was filed on May 17, 2019, which is pending of judgment by the Superior Chamber of Tax Appeals (CSRF); (ii) R$ 137,743 correspond to a lawsuit filed by the subsidiary Gerdau Aços Longos, which had its Voluntary Appeal judged at the first instance of CARF on November 5, 2019, which was dismissed, and the declaration embargoes against the decision were rejected, which gave rise to the filing of a Special Appeal filed on March 2, 2020, ratified on June 8, 2020, partially admitted, which is pending of judgment by the Superior Chamber of Tax Appeals (CSRF); (iii) R$ 140,076, corresponds to a lawsuit filed by the subsidiary Gerdau Aços Longos S.A., whose objection was partially dismissed by the Federal Revenue Judgment Office (DRJ), which led to the filing of a Voluntary Appeal on June 3, 2019, that it was judged on March 10, 2020 and dismissed by the first instance of CARF, which gave rise to the filing of a Special Appeal filed on November 3, 2020; (iv) R$ 158,723 corresponds to a lawsuit of Gerdau S.A. dismissed by the first instance of the Administrative Tax Appeals Council (CARF) on November 5, 2019, which was dismissed by majority vote and the opposite declaration embargoes against that decision were rejected, which gave rise to the filing of a Special Appeal on July 1, 2020; partially admitted, and which is pending of judgment by the Superior Chamber of Tax Appeals (CSRF); (v) R$ 197,082 corresponds to a lawsuit of Gerdau S.A., whose impugnation was dismissed by the Federal Revenue Judgment Office (DRJ) and filed a Voluntary Appeal at first instance of CARF, on June 17, 2019, which was judged on April 7, 2020 and was partially provided, which gave rise to the filing of a Special Appeal on November 17, 2020; (vi) R$ 242,441 correspond to a lawsuit filed by the subsidiary Gerdau Aços Longos S.A., which was rejected by the Federal Revenue Judgment Office (DRJ), which led to the filing of a Voluntary Appeal on June 23, 2020; (vii) R$ 57,659 corresponds to a lawsuit filed by the subsidiary Gerdau Aços Longos S.A., whose objection was filed on December 15, 2020, and which is awaiting judgment by the Federal Revenue Judgment Office (DRJ); (viii) R$ 192,245 corresponds to a lawsuit filed by the subsidiary Gerdau Aços Longos S.A., whose notice was received on December 7, 2020, whose challenge was presented on January 6, 2021. a.4) The Company is party to administrative proceedings related to goodwill amortization pursuant to articles 7 and 8 of Law 9,532/97, from the basis of calculation of Corporate Income Tax (IRPJ) and Social Contribution on net income (CSLL), resulting from a corporate restructuring started in 2010. The updated total amount of the assessments is R$ 436,443, of which: (i) R$ 24,375 corresponds to a process in which the opposite Declaration Embargoes were rejected against the decision that granted the official appeal in favor of the National Treasury, and the Special Appeal filed by the Company is pending of judgment; (ii) R$ 198,703 corresponds to a lawsuit in which the Company impugnation was rejected by the Federal Revenue Judgment Office (DRJ) and filed a Voluntary Appeal with the Administrative Tax Appeals Council (CARF), which is pending of judgment; (iii) R$ 69,566 correspond to a lawsuit in which the Company had its challenge partially provided and filed a Voluntary Appeal with the Administrative Council for Tax Appeals (CARF), which is pending of judgment; and (iv) R$ 143,799 correspond to a Notice of Infraction received by the Company on December 2, 2019, against which it presented an Objection on December 27, 2019, deemed partially valid by the Federal Revenue Judgment Office (DRJ), pending judgment by the Council Administrative Tax Appeals (CARF) the Voluntary Appeal filed. a.5) Gerdau S.A. (as successor of Gerdau Aços Especiais S.A.) and its subsidiary Gerdau Internacional Empreendimentos Ltda. are parties to administrative and judicial proceedings relating to IRPJ — Corporate Income Tax and CSLL — Social Contribution Tax, in the current amount of R$ 1,286,160. Such lawsuits relate to profits generated abroad, of which: (i) R$ 1,068,796, correspond to three lawsuits of the subsidiary Gerdau Internacional Empreendimentos Ltda., of which (i.a) R$ 859,699 correspond to a Tax Foreclosure against which the Company filed embargoes to execution that were judged partially unfounded, by means of a judgment handed down on July 15, 2019, complemented by a decision published on October 21, 2019, after opposition to the motion for clarification, which was the subject of an appeal filed by the Company and the National Treasury, currently pending of judgment by the Federal Regional Court of the 4 th Region; and (i.b) R$ 35,886 correspond to a process partially provided by the Superior Chamber of Tax Appeals of CARF (CSRF), in a decision published on May 25, 2017 and already final and unappealable; the matters not previously analyzed by the first instance of the Administrative Council for Tax Appeals (CARF), as determined by the decision of the CSRF, were judged on October 16, 2019, by a partially favorable decision, against which the company was noticed on December 30, 2020, for payment of the remaining debt; (i.c) R$ 168,184 corresponds to a Tax Foreclosure against which the Company filed an Embargo to Enforcement on December 1, 2020; and (ii) R$ 222,391 correspond to a Tax Foreclosure filed against Gerdau S.A. (as successor to Gerdau Aços Especiais S.A.), against which the Company filed an Embargo to Execution on July 7, 2020. a.6) Gerdau S.A. (as successor of Gerdau Aços Especiais S.A.) and its subsidiaries Gerdau Aços Longos S.A. and Gerdau Açominas S.A. are parties to administrative and judicial proceedings relating to the disallowance of goodwill amortization generated in accordance with Article 7 and 8 of Law 9,532/97 — as a result of a corporate restructuring carried out in 2004/2005 — from the tax base of the Corporate Income tax - IRPJ and Social Contribution on Net Income - CSLL. The total updated amount of the proceedings is R$ 7,984,187, of which (i) R$ 5,371,636 correspond to four proceedings involving the Company (as successor of Gerdau Aços Especiais S.A.) and its subsidiaries Gerdau Aços Longos S.A. and Gerdau Açominas S.A., for which administrative discussions already ended and are currently in the judicial collection stage; and the Companies obtained injunctive relief to permit it to offer a judicial collateral using an insurance bond, for judicial execution embargoes to stay execution in the respective proceedings, and in the execution embargoes filed by the Company (as successor of Gerdau Aços Especiais S.A.), on May 17, 2018, a judgment was rendered dismissing the fiscal launch, in the face of which the National Treasury filed an appeal. On April 8, 2021, the Federal Regional Court of the 4 th Region, by majority, dismissed the appeal of the National Treasury; and also, in the Execution Embargoes filed by the subsidiary Gerdau Aços Longos S.A. (as successor of Gerdau Comercial de Aços S.A.) on October 3, 2019, a judgment was rendered dismissing the tax assessment, which was fully confirmed after opposition to embargoes of declaration by the National Treasury, and an appeal was filed for the embargo; (ii) R$ 317,710 corresponds to a lawsuit filed by the subsidiary Gerdau Aços Longos S.A., in which part of the debt whose administrative discussion has already ended is under judicial discussion, having been handed down on September 29, 2020, which was upheld the Embargoes to Execution and recognized the in substance of the tax assessment; (iii) R$ 295,064 corresponds to a lawsuit filed by the subsidiary Gerdau Aços Longos S.A., in which part of the debt whose administrative discussion ended and is under judicial discussion, in the notices of Embargoes to Execution filed on August 14, 2019, considered unfounded on October 15, 2020, the Company filed a motion for clarification against that sentence; (iv) R$ 4,289 corresponds to a lawsuit of the of subsidiary Gerdau Aços Longos S.A., which is awaiting judgment of its Special Appeal filed with the CSRF, which has been partially followed up; (v) R$ 67,904 correspond to a lawsuit by the subsidiary Gerdau Aços Longos S.A., whose Special Appeal filed against CSRF was dismissed on December 5, 2019, which was dismissed; currently, the lawsuit is in the process of judicial collection, and the Company has offered a judicial guarantee, as a precautionary measure, through Guarantee Insurance, and is preparing for the start of the judicial discussion on Embargoes to Execution; (vi) R$ 135,365 corresponds to a lawsuit of the Company (as successor of Gerdau Aços Especiais S.A.), which its Special Appeal was partially known and it is pending of judgment; (vii) R$ 499,483 corresponds to a lawsuit filed by the subsidiary Gerdau Aços Longos SA, which had its Voluntary Appeal partially provided, being this decision subject of a Special Appeal by the National Treasury and a Special Appeal filed by the Company on April 29, 2019, both currently pending of judgment; (viii) R$ 107,190 correspond to a lawsuit filed by the Company (as successor of Gerdau Aços Especiais S.A.), which awaits judgment of the Special Appeal filed against the decision that dismissed its Voluntary Appeal; (ix) R$ 557,927 corresponds to a lawsuit filed by the subsidiary Gerdau Aços Longos S.A., which was rejected, and the Voluntary Appeal filed by the Company is pending of judgment at the first instance of CARF; (x) R$ 486,175 correspond to a lawsuit filed by the subsidiary Gerdau Aços Longos S.A., whose objection was dismissed by the Federal Revenue Judgment Office (DRJ), and the voluntary appeal filed by the Company is currently pending of judgment; and (xi) R$ 141,444 corresponds to a lawsuit filed by the subsidiary Gerdau Aços Longos SA, separated from the process mentioned in item “vi” above, and which it is currently in the judicial collection phase, already guaranteed by guarantee insurance presented in precautionary measure, and the Company filed Embargos to Tax Enforcement on December 17, 2020. The Company’s tax advisors confirm that the procedures adopted by the Company regarding the tax treatment of profits earned abroad and the goodwill amortization, which led to the aforementioned lawsuits, have complied with the strict legality and, therefore, these lawsuits are classified as possible loss (but not likely). Brazilian federal authorities and the judiciary branch are investigating certain issues relating to CARF proceedings, as well as specific political contributions made by the Company, with the purpose of determining whether the Company engaged in any illegal conduct. The Company previously disclosed that, in addition to its interactions with Brazilian authorities, the Company was providing information requested by the U.S. Securities and Exchange Commission (“SEC”). The Company has since been informed by the SEC’s staff that it has closed its inquiry and therefore is not seeking any further information from the Company regarding these matters. The Company believes it is not possible at this time to predict the term or outcome of the proceedings in Brazil, and that there currently is not enough information to determine whether a provision for losses is required or any additional disclosures. b) Civil contingencies b.1) A lawsuit arising from the request by two civil construction unions in the state of São Paulo alleging that Gerdau S.A. and other long steel producers in Brazil share customers, thus, violating the antitrust legislation. After investigations carried out by the Economic Law Department (SDE – Secretaria de Direito Econômico), the final opinion was that a cartel exists. The lawsuit was therefore forwarded to the Administrative Council for Economic Defense (CADE) for judgment, which resulted in a fine to the Company and other long steel producers, on September 23, 2005, an amount equivalent to 7% of gross revenues in the year before the Administrative Proceeding was commenced, excluding taxes (fine of R$ 245,070, updated by the judicial accountant on August 1, 2013 to R$ 417,820). Two lawsuits challenge the investigation conducted by the Competition Defense System and its merits judgment, whose grounds are procedural irregularities, especially the production of evidence, based on an economic study, to prove the inexistence of a cartel. The Court, upon offer of bank guarantee letter, granted the suspension of the effects of CADE’s decision. Both actions were dismissed, and their respective appeals were also rejected by the Federal Regional Court of the 1 st Region. Against both decisions, appeals were lodged with the Superior Court of Justice and the Federal Supreme Court, after admissibility judgment, the appeal to the Superior Court of Justice was admitted and well as substitution of the guarantee offered by insurance guarantee in a decision of October 8, 2019. In the same order in which the Vice president Judge gave suspensive effect to the Special Appeal, in order to change the guarantee, the Extraordinary Appeal was dismissed, on the grounds of violation of res judicata with recognized general repercussion. Against this decision, the Company filed an Internal Appeal for the TRF1 Plenary. The Federal Government withdrew the lawsuit to prepare the reasons for this appeal and has not yet returned the case, since the procedural deadlines have been suspended. Regardless of the result of its resources, the Company will continue to seek all legal remedies to defend its rights. The Company denies having been engaged in any type of anti-competitive conduct and it is certain that it has not practiced the conduct attributed to it, understanding shared by its legal consultants, who consider it is possible to reverse its condemnation. b.2) The Company and its subsidiaries are parties to other demands of a civil nature that collectively have a discussion amount of approximately R$ 316,054. For these demands, no accounting provision was recorded, since they were considered as possible losses, based on the opinion of its legal counsel. c) Labor Contingencies The Company and its subsidiaries are parties to other labor claims that together have an amount of approximately R$ 153,459. For these claims, no accounting provision was made, since these were considered as possible losses, based on the opinion of management with input from legal counsel. III) Judicial deposits The Company has judicial deposits related to tax, labor and civil lawsuits as listed below: 2020 2019 Tax 1,597,995 1,837,967 Labor 95,234 113,379 Civil 132,562 40,369 1,825,791 1,991,715 The balance of judicial deposits as of December 31, 2020, in the amount of R$ 1,504,582, corresponds to judicial deposits made up to June 2017, referring to the same discussion on the inclusion of the ICMS in the tax base of PIS and COFINS, that awaits termination of the lawsuits before the Brazilian courts in order to be returned to the Company. The Company and its subsidiaries made judicial deposits and accounting provisions, which in turn were updated in accordance with the SELIC rate, which were referred to the unpaid amounts of PIS and COFINS since 2009, because the collection of which was fully suspended, due to the mentioned judicial deposits. On March 15, 2017, the Brazilian Federal Supreme Court (STF - Supremo Tribunal Federal) ruled on a claim related to this matter, and by 6 votes to 4, concluded: “The ICMS does not comprise the tax base for PIS and COFINS assessment purposes”. The STF decision, in principle, affects all of the judicial proceedings in progress, due to its general repercussion. However, after the publication of the decision on October 2, 2017, the Attorney of the National Treasury filed an appeal, claiming that the decision of the Supreme Court was silent on certain points, and requested a modulation of the decision effects, which may limit its effects to the taxpayers. A provision is recognized only when “it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation”, among other requirements. On March 31, 2017 the Company, based on (i) the conclusion of this judgment by the STF in Extraordinary Appeal No. 574,706/RG with general repercussion, which ruled that the inclusion of the ICMS in the PIS and COFINS calculation tax base was unconstitutional, and (ii) the International Financial Reporting Standards (IFRS), reversed the aforementioned accounting provision, through the recognition of R$ 929,711 in the line Reversal of provision for tax liabilities, net (Operational result) and R$ 369,819 in the line Reversal of interest on provision for tax liabilities, net (Financial Result), in its consolidated statements of income. The Company’s decision is supported by the position of its legal advisors who, when reassessing the likelihood of loss in the ongoing lawsuits related to the matter, concluded that the probability of loss, as to the merits of these lawsuits, became remote as of the date of the enactment of this decision. The Company emphasizes, however, that as a result of the appeal of embargoes for declaration filed by the Federal Government in Extraordinary Appeal No. RE 574.706/RG, there is the possibility that the STF understands as present the requirements for applying modulation to the case, or defines that the ICMS to be excluded from the PIS and Cofins calculation base is the one actually paid, and not the one informed in the invoice as the taxpayers defend, which may result in limiting the effects of the decision already rendered, in which case it may be necessary a reassessment of the risk of loss associated with these lawsuits. Therefore, depending on the terms of the decision to be rendered by the STF in the judgment of the embargoes for declaration in RE nº 574.706/RG, such reassessment may result in the need to record new provisions on this matter in the future. The Company also informs that four of these lawsuits already have a final and unappealable decision in benefit of the Company. The first of these became final on July 19, 2019, assuring to the Company: i) the right to recover undue payments before the proposed action, in the amount of R$ 122 million (R$ 79 million net of related expenses), and ii) the right to withdraw the judicial deposits made during the course of this action, which was made on September 16, 2019, in the amount of R$ 179 million. The Company recognized the gain when the decision was final and unappealable, considering for the purposes of calculation the exclusion of the ICMS informed in the invoices, and enabled its credit before the Federal Revenue Service of Brazil, which was granted, having started the offsetting procedures . It is important to note that, supported by the COSIT Internal Consultation Solution No. 13/2018, on January 7, 2021, the Federal Revenue Service of Brazil initiated a procedure to collect R$ 100 million, of differences supposedly due by the Company, calculated on the judicial deposits performed during the course of this lawsuit and which were lifted by judicial determination, after the final and unappealable decision, without any opposition from the National Treasury Attorney. The Company has already adopted the appropriate measures to counter the collection, and, supported by the position of its legal advisors, understands this litigation as a remote loss, given that the final decision prevented the collection of contributions to PIS and COFINS on the ICMS, without any restriction, recognizing that, under the terms of Law 9,703/98, the deposits belong to the winning party, so that the collection intended by the Federal Revenue Service characterizes noncompliance with the order established in the final and unappealable judicial title, in addition to understanding established in several precedents of the Federal Regional Court of the 4 th Region, which expressly exclude the claim of application of the Internal Consultation Solution COSIT nº 13/2018. The second became final on December 18, 2019, assuring to the Company: i) the right to recover undue payments made before the filing of the lawsuit, as well as during its processing, in the amount of R$ 280 million (R$ 185 million net of related expenses), and ii) the right to withdraw judicial deposits made during the course of this action, which was made on May 27, 2020, in the amount of R$ 189 million. The Company recognized the gain when the decision was final and unappealable, considering for the purposes of calculation the exclusion of the ICMS informed in the invoices, as expressly recognized in the final and unappealable decision, and enabled its credit before the Federal Revenue Service of Brazil, which was granted, having started the compensation procedures. The third became final on June 29, 2020, assuring to the Company: i) the right to recover undue payments made before the filing of the lawsuit, as well as during its processing, in the amount of R$ 147 million (R$ 135 million net of related expenses), and ii) the right to withdraw judicial deposits made during the course of this action in the amount of R$ 193 million. The Company recognized in 2020 the gain when the decision was final and unappealable, considering for the purposes of calculation the exclusion of the ICMS informed in the invoices and awaits the withdrawal of judicial deposits and the qualification of its credit before the Federal Revenue Service of Brazil in order to start the offsetting procedures. The fourth became final on November 18, 2020, assuring to the Company: i) the right to recover undue payments made before the filing of the lawsuit, as well as during its processing, in the amount of R$ 940 million (R$ 902 million, net of related expenses), and ii) the right to withdraw judicial deposits made during the course of this action in the amount of R$ 3 million. The Company recognized in 2020 the gain when the decision was final and unappealable, considering for the purposes of calculation the exclusion of the ICMS informed in the invoices and began to qualify its credit before the Federal Revenue Service of Brazil, which is awaiting analysis. The fact that some of the final and unappealable decisions in favor of the Company recognized the right to the exclusion of ICMS from the PIS and COFINS calculation basis, without specifying which ICMS to be excluded (whether the informed or the collected), does not change the understanding of the Company, supported by the position of its legal advisors, in the sense that the decisions guarantee the right to the exclusion of the ICMS informed in the invoices. In the case of unappealable claims in favor of the Company, the calculation of the amount of the undue to be recovered was presented from the beginning, in the initial petitions, and demonstrate unequivocally that the amount claimed was calculated with the exclusion of the ICMS informed in the invoices, which it also allowed the Company to reliably measure the amount to be effectively recovered, which was recognized in its assets when the lawsuits became unappealable. It is also important to note that in the Company's initial petitions reference was always made to the ICMS (generally, as a whole, since without discrimination of any portion), the same as the Treasury required to be included in the PIS and COFINS calculation base. In addition, when presenting its challenge in the aforementioned processes, the Federal Government has always referred to the ICMS as a whole, either to affirm its necessary inclusion in the PIS and COFINS calculation base, or to challenge the Company's request for its exclusion, in no moment making any differentiation to this or that portion of it, whether the informed or the actually paid. Finally, it is important to note that the understanding of the Company, supported by its legal advisors, arises from the interpretation of the decision rendered by STF in Extraordinary Appeal No. 574.706/RG with general repercussion, when it decided for the unconstitutionality of the inclusion of ICMS, as a whole (without any differentiation), in the PIS and COFINS calculation basis, which is expected to be confirmed in the judgment of the embargoes for declaration filed by the Federal Government. In addition, it is important to note that the Company has four lawsuits for the repetition of undue payments that are awaiting the respective unappealable decision. In these lawsuits, the Company seeks the recognition of R$ 773 million of credits prior to the filing of the Legal Actions (contingent asset not recognized by the Company in its accounting books), as well as expects to raise the judicial deposits linked to said lawsuits, in the amount of R$ 1.3 billion, and a writ of mandamus, whose undue amount will be determined in due course. On April 13, 2020, due to the economic moment strongly impacted by the pandemic caused by COVID-19, as well as the fact that the procedural legislation expressly provides the equivalence of cash and guarantee insurance, the subsidiary Gerdau Aços Longos SA requested the replacement of the amounts deposited by it over the years regarding the Inclusion of ICMS in the PIS and COFINS Calculation Base for a guarantee insurance presented by the Company, in the amount of R$ 1.7 billion, which complies with all the requirements established by the PGFN (Attorney General of the National Treasury) and can be converted into income at any time, ensuring that the Public Treasury receives all the amounts that may eventually be due at the end of the process. In the lower court decision, therefore, there was a decision to release the funds deposited by the Company. The Public Treasury appealed to the Court and obtained a decision reversing the release of the amounts. The Company then filed a complaint to settle differences between the decision issued by the Federal Judge, member of the 4 th Specialized Panel of the Federal Regional Court of the 2 nd Region, in the case files of process nº 50003743-37.2020.4.02.0000, and the jurisprudence of the Supreme Court (Theme nº 69). With an initially favorable injunction, the decision was later suspended to await the statement by the National Treasury regarding the fine for bad faith litigation applied to the Company. After the manifestation, which did not bring any additional element in relation to the fine for bad faith litigation applied, the Minister understood that the Complaint was not applicable due to the lack of exhaustion of ordinary channels. Regarding the fine for bad faith litigation, applied due to the allegation of alleged attempt to mislead the Judiciary, the Company informs that it has always manifested itself in the file with procedural good faith and is confident that this will be clarified during the process. IV) Eletrobrás Compulsory Loan — Centrais Elétricas Brasileiras S.A. (Eletrobrás) The Compulsory Loan, instituted by the Brazilian government in order to expand and improve the energy sector of the country was charged and collected from industrial consumers with monthly consumption equal or greater than to 2000kwh through the “electricity bills” issued by the electric power distribution companies, was converted into credits to the taxpayers based on the annual value of these contributions made between 1977 and 1993. The legislation sets a maximum 20 years period to return the compulsory loan to the taxpayers, providing Eletrobrás the possibility of anticipating this return through the conversion of those loans in shares of its own issuance. Prior to the conversion of the credits into shares, those credits were monetary corrected through an indexer and quantifier, called Standard Unit (SU). However, the compulsory loan was charged to the companies in their monthly electricity bills, consolidated during the year, and only indexed by the SU in January of the following year, resulting in a lack of monthly monetary correction during the years of collection, as well as interest. This procedure imputed to taxpayers’ considerable financial losses, particularly during the periods when the monthly inflation rates stood at high levels. In order to claim the appropriate interest and monetary correction subtracted by the methodology applied by Eletrobrás, the Company (understood to be legally entities existing at the time and that later became part of Gerdau S.A.) filed lawsuits claiming credits resulting from differences on the monetary correction of principal, interest, default interest and other accessory amounts owed by Eletrobrás due to the compulsory loans. In 2015, cases involving representative amounts were definitively judged by the Superior Court of Justice - STJ favorable to the Company so that n

RELATED-PARTY TRANSACTIONS

RELATED-PARTY TRANSACTIONS	12 Months Ended
	Dec. 31, 2020
RELATED-PARTY TRANSACTIONS
RELATED-PARTY TRANSACTIONS	NOTE 20 — RELATED-PARTY TRANSACTIONS a) Intercompany loans Maturity 2020 2019 Assets Joint venture Gerdau Corsa SAPI de C.V. January 1, 2021 117,092 73,607 Others Fundação Gerdau December 31, 2022 17,262 21,838 134,354 95,445 Liabilities Joint venture Bradley Steel Processors Inc. August 1, 2021 (22,855) - (22,855) - 2020 2019 2018 Net financial income 8,277 4,767 545 b) Operations with related parties During the years ended December 31, 2020, 2019 and 2018, the Company, through its subsidiaries, entered into commercial operations with some of its associate companies and joint ventures including sales of R$ 887,945 as of December 31, 2020 (R$ 1,572,618 and R$ 1,382,584 as of December 31, 2019 and 2018, respectively) and purchases in the amount of R$ 208,948 as of December 31, 2020 (R$ 198,636 and R$ 129,513 as of December 31, 2019 and 2018, respectively). The net amount totals R$ 678,997 as of December 31, 2020 (R$ 1,373,982 and R$ 1,253,071 as of December 31, 2019 and 2018, respectively). The Company and its subsidiaries carried out transactions with controlling shareholders referring to the sale of property in the amount of R$ 21,204 with receipt in six annual installments of R$ 3,534, adjusted by the positive variation of the IPCA. The first installment was already received in the year of 2020, with the accounts receivable of R$ 17,670 remaining as of December 31, 2020, which is fully guaranteed by means of personal guarantee. The decision about the buyer was made through a competitive market process that considered several potential buyers to whom the asset was presented, under the coordination of an independent specialized company. The sale price was determined based on independent valuations and carried out by professionals specialized in valuing tangible assets. As a conclusion of this process, the best proposal was recommended under the terms of the independent appraisal and, as it is a related party, it was approved by the Board of Directors, observing the terms of the Company's Related Party Transactions Policy. Additionally, the Company recorded income of R$ 524 (R$ 554 and R$ 445 as of December 31, 2019 and 2018, respectively), derived from rental agreement. During the years ended December 31, 2019 and 2018, the Company and its subsidiaries made transactions with controlling shareholders, directly or indirectly, mainly of guarantees provided by the controlling shareholders in guarantees of debentures, on which the Company payed a fee of 0.95 % p.a. on the amount guaranteed. The effect of these transactions was an expense of R$ 68 and R$ 194 as of December 31, 2019 and 2018, respectively. Guarantees granted Original Related Party Relationship Object Amount Maturity 2020 2019 2018 Gerdau Corsa S.A.P.I. de C.V. Joint-venture Financing Agreements 1,750,249 Oct/22 - Oct/24 2,242,865 1,784,868 1,933,929 Gerdau Summit Aços Fundidos e Forjados S.A. Joint-venture Financing Agreements 130,164 Aug/25 30,125 37,285 41,571 Gerdau Metaldom S.A. e Gerdau Corsa S.A.P.I. de C.V Joint-venture Financing Agreements 274,560 Feb/20 - 241,842 198,619 c) Price and interest Loan agreements between Brazilian companies carry interest based on the CDI (Interbank Deposit Certificate) and Libor rate plus exchange variance, when applicable. Sales of products and purchases of inputs are made under terms and conditions agreed between the parties. d) Key Management compensation The expense recognized related to key management salaries, variable compensation and benefits was R$ 41,165 during 2020 (R$ 32,359 in 2019). In 2020, contributions to management’s defined contribution pension plans totaled R$ 1,416 (R$ 1,687 in 2019). The expense of long-term incentive plans recognized in income and attributable to key management (members of Board of Directors and executive officers) totaled R$ 39,766 during 2020 (R$ 26,631 in 2019). At the end of the year, quantity of Restricted and Performance Shares with the key management were: 2020 2019 Available at beginning of the year 6,717,872 6,375,547 Granted 733,218 1,083,116 Exercised (937,325) (627,076) Cancelled (64,112) (38,553) Others 6,595 (75,163) Available at the end of the year 6,456,248 6,717,872 Additional information on the long-term incentive plan are presented in Note 27. e) Other information from related parties Contributions to the assistance entities Fundação Gerdau, Instituto Gerdau and Fundação Ouro Branco, classified as related parties, amounted R$ 104,322 during 2020 (R$ 96,191 in 2019). The defined benefit pension plans and the post-employment health care benefit plan are related parties of the Company and the details of the balances and contributions are presented in note 21.

EMPLOYEE BENEFITS

EMPLOYEE BENEFITS	12 Months Ended
	Dec. 31, 2020
EMPLOYEE BENEFITS
EMPLOYEE BENEFITS	NOTE 21 — EMPLOYEE BENEFITS Total assets and liabilities of all types of employee benefits granted by the Company and its subsidiaries as of December 31, 2020 are as follows: 2020 2019 Plan assets - Defined contribution pension plan 39,196 45,381 Total assets 39,196 45,381 Actuarial liabilities - Defined benefit pension plan 1,441,592 1,138,592 Acturial liabilities - Post-employment health care benefit 362,944 298,989 Retirement and termination benefit liabilities 56,903 32,863 Total liabilities 1,861,439 1,470,444 Current 208 495 Non-current 1,861,231 1,469,949 a) Post-employment defined benefit pension plan The Company’s Canadian and US subsidiaries sponsor defined benefit plans (Canadian Plan and American Plan), collectively referred to as the North American Plans, that cover substantially all their employees and provide supplemental benefits to employees during retirement. Additionally, the Company and its subsidiaries in Brazil sponsored a defined benefit pension plan (Brazilian plans), which are managed through Gerdau - Sociedade de Previdência Privada, a closed supplementary pension entity. In 2010, it was approved the settlement of a defined benefit plan, in which the participants had the rights for the benefit settled. All participants of those plans, which are now settled, were able to: (i) choose to adhere to a new defined contribution plan, when it was authorized to transfer the amount related to the individual mathematical reserve from the settled plan for the new plan and add amounts to this reserve through future contributions and sponsors, plus the resources profitability; or (ii) do not transfer the reserve and maintain the benefit settled in the defined benefit plan, adjusted by the INPC (National Index of Consumer Prices). The assumptions adopted for pension plans can have a significant effect on the amounts disclosed and recorded for these plans. Due to the migration process and the closing of the Brazilian pension plans in 2010, the Company is not calculating the potential effects of changes in discount rates and expected return rate on assets for these plans. The potential effects of changes to the North American Plans on the Consolidated Statement of Income are presented below: 1% Increase 1% Decrease Discount rate (17,965) 12,482 The accumulated amount recognized in other Comprehensive Income for employee benefits is R$ (1,173,010) as of December 31, 2020 (R$ (1,120,938) as of December 31, 2019). Defined Benefit Pension Plan The current expenses of the defined benefit pension plans are as follows: 2020 2019 2018 Cost of current service 69,323 54,518 60,803 Interest expense 191,326 189,544 82,513 Return on plan assets (156,475) (163,148) (59,692) Past service cost 3,967 2,302 7,065 Settlement (11,609) (4,712) 3,220 Interest cost on unrecoverable surplus 7,413 16,247 20,023 Net pension cost 103,945 94,751 113,932 The reconciliations of assets and liabilities of the plans are as follows: 2020 2019 Present value of defined benefit obligation (5,921,285) (4,601,965) Fair value of plan assets 4,652,000 3,656,891 Asset ceiling restrictions on recognition of net funded assets (172,307) (193,517) Net (1,441,592) (1,138,591) Defined benefit obligation (1,441,592) (1,138,591) Changes in plan assets and actuarial liabilities were as follows: 2020 2019 2018 Variation of the plan obligations Obligation at the begining of the year 4,601,965 4,391,251 4,314,592 Cost of service 69,323 54,518 60,803 Interest expense 191,326 189,544 188,729 Payments of the benefits (434,650) (309,817) (318,198) Past service cost 3,967 2,302 7,065 Supplementary amounts of the plan - - 17,078 Settlement (190,948) (498,493) (61,369) Acturial remeasurements 467,106 546,911 (370,083) Exchange Variance 1,213,196 225,749 552,634 Obligation at the end of the year 5,921,285 4,601,965 4,391,251 2020 2019 2018 Variation of the plan assets Fair value of the plan assets at the begining of the year 3,656,891 3,568,934 3,456,613 Return of the plan assets 156,475 163,148 165,908 Contributions from sponsors 224,979 162,650 197,828 Settlement (179,339) (493,781) (64,868) Payments of benefits (434,650) (309,817) (318,198) Remeasurement 334,675 386,767 (253,301) Exchange Variance 892,969 178,990 384,952 Fair value of plan assets at the end of the year 4,652,000 3,656,891 3,568,934 The fair value of plan assets includes shares of the Company in the amount of R$ 8,745 as of December 31, 2020 (R$ 10,221 as of December 31, 2019). Amounts recognized as actuarial gains and losses in the Statement of Comprehensive Income are as follows: 2020 2019 2018 Remeasurements (334,675) (386,767) 253,301 Actuarial Remeasurements 467,106 546,911 (370,083) Restriction recognized in Other Comprehensive Income (42,317) (94,198) (43,197) Remeasurements recognized in Other Comprehensive Income 90,114 65,946 (159,979) The historical actuarial remeasurements are as follows: 2020 2019 2018 2017 2016 Present value of defined benefit obligation (5,921,285) (4,601,965) (4,391,251) (4,314,592) (4,174,653) Fair value of the plan assets 4,652,000 3,656,891 3,568,934 3,456,613 3,292,890 Surplus (Deficit) (1,269,285) (945,074) (822,317) (857,979) (881,763) Experience adjustments on plan liabilities (Gain) 467,106 546,911 (370,083) 235,549 186,905 Experience adjustments on plan assets (Gain) (334,675) (386,767) 253,301 (232,214) (109,153) Actuarial remeasurements are recognized in the period in which they occur and are recorded directly in comprehensive income. The allocations for plan assets are presented below: 2020 Brazilian Plans American Plans Fixed income Variable income - Others Total 2019 Brazilian Plans American Plans Fixed income Variable income - Others Total The investment strategy for the Brazilian Plan is based on a long-term macroeconomic scenario. This scenario assumes a reduction in Brazil’s sovereign risk, moderate economic growth, stable levels of inflation, exchange rates and moderate interest rates. The Canadian and American subsidiaries have an Investment Committee that defines the investment policy for the defined benefit plans. The primary investment objective is to ensure the security of benefits that were accrued under the plans, providing an adequately funded asset pool which is separated and independent of the Company. To reach this objective, the fund must invest in a manner that adheres to safeguards and diversification to which a prudent investor of pension funds would normally adhere. These subsidiaries retain specialized consultants that advice and support Investment Committee decisions and recommendations. The asset mix policy considers the principles of diversification and long-term investment goals, as well as liquidity requirements. To do this, the target allocation ranges between 50% in shares, 40% in debt securities and 10% in alternative securities, and for Brazilian Plan it is close to 100% in fixed income. The tables below show a summary of the assumptions used to calculate the defined benefit plans in 2020 and 2019, respectively: 2020 Brazilian Plan North America Plan Average discount rate 2.25% - 2.50% Rate of increase in compensation Not applicable Mortality table AT-2000 per sex RP-2006 and MP-2020 Mortality table of disabled AT-2000 per sex RP-2006 and MP-2020 Rate of rotation Null Based on age and/or the service 2019 Brazilian Plan North America Plan Average discount rate 3.00% - 3.25% Rate of increase in compensation Not applicable Mortality table AT-2000 per sex RP-2006 and MP-2019 Mortality table of disabled AT-2000 per sex RP-2006 and MP-2019 Rate of rotation Null Based on age and/or the service b) Post-employment defined contribution pension plan The Company and its subsidiaries in Brazil, in the United States and in Canada maintain a defined contribution plan to which contributions are made by the sponsor in proportion to the contributions made by its participating employees. The total cost of these plans was R$ 133,963 in 2020 (R$ 118,283 in 2019). c) Post-employment health care benefit plan The North American plans include, in addition to pension benefits, specific health care benefits for employees who retire after a certain age and with a certain number of years of service. The Americans and Canadian subsidiaries have the right to change or eliminate these benefits, and the contributions are actuarially calculated. The net periodic costs of post-employment health care benefits are as follows: 2020 2019 2018 Current service cost 4,964 3,302 4,144 Interest expense 11,311 10,656 11,082 Past service cost (660) (2,717) (40,740) Net cost pension benefit 15,615 11,241 (25,514) The funded status of the post-employment health benefits plans is as follows: 2020 2019 Present value of obligations (362,944) (298,989) Total net liabilities (362,944) (298,989) Changes in plan assets and actuarial liabilities were as follows: 2020 2019 2018 Change in benefit obligation Benefit obligation at beginning of the year 298,989 272,959 316,364 Cost of service 4,964 3,302 4,144 Interest expense 11,311 10,656 11,082 Past service cost (660) (2,717) (40,740) Contributions from participants 2,349 2,088 1,496 Payment of benefits (20,870) (15,331) (18,655) Remeasurements (23,533) 11,202 (40,841) Exchange variations 90,394 16,830 40,109 Benefit obligation at the end of the year 362,944 298,989 272,959 2020 2019 2018 Change in plan assets Contributions from sponsors 19,150 13,243 17,159 Contributions from participants 2,349 2,088 1,496 Payments of benefits (21,499) (15,331) (18,655) Fair value of plan assets at end of the year - - - The historical actuarial gains and losses of the plans are as follows: 2020 2019 2018 2017 2016 Present value of defined benefit obligation (362,944) (298,989) (272,959) (316,364) (305,447) Deficit (362,944) (298,989) (272,959) (316,364) (305,447) Experience adjustments on plan liabilities (23,533) 11,202 (40,841) (14,452) (3,673) The amounts recognized as actuarial gains and losses in other comprehensive income are as follows: 2020 2019 2018 Losses / Gains on actuarial obligation (23,533) 11,202 (40,841) Actuarial losses recognized in Equity (23,533) 11,202 (40,841) The accounting assumptions adopted for post-employment health benefits are as follows: 2020 2019 Average discount rate 2.25% - 2.50% 3.00% - 3.25% Health treatment - rate assumed next year 6.10% - 6.50% 5.80% - 6.70% Health treatment - Assumed rate of decline in the cost to achieve in the years of 2028 to 2041 4.00% - 4.40% 4.00% - 4.40% The assumptions adopted for post-employment health benefits have a significant effect on the amounts disclosed and recorded for post-employment health benefits plans. The change of one-point percentage on discount rates would have the following effects: 1% Increase 1% Decrease Effect over total service costs and interest costs 2,739 (2,171) Effect over benefit plan obligations 43,331 (34,975) d) Other retirement and termination benefits The benefits of this plan provide a compensation supplement up to retirement date, cost of living allowance, and other benefits as a result of termination and retirement of the employees. The Company estimates that the total obligation for these benefits was R$ 56,901 as of December 31, 2020 (R$ 32,863 as of December 31, 2019).

ENVIRONMENTAL LIABILITIES

ENVIRONMENTAL LIABILITIES	12 Months Ended
	Dec. 31, 2020
ENVIRONMENTAL LIABILITIES
ENVIRONMENTAL LIABILITIES	NOTE 22 — ENVIRONMENTAL LIABILITIES The steel industry uses and generates substances that may damage the environment. The Company and its subsidiaries believe they are compliant with all the applicable environmental regulations in the countries where they operate. The Company’s management performs frequent analysis with the purpose of identifying potentially impacted areas and a liability is recorded based on the best estimate of costs for investigation, treatment and cleaning of potentially affected sites. The Company uses estimates and assumptions to determine the amounts involved, which may change in the future, as result of the final investigations and the determination of the actual environmental impact. The balances of the provisions are as follows: 2020 2019 Provision for environmental liabilities 297,094 112,308 Current 125,992 60,913 Non-current 171,102 51,395

OBLIGATIONS WITH FIDC - INVESTM

OBLIGATIONS WITH FIDC - INVESTMENT FUND IN CREDIT RIGHTS	12 Months Ended
	Dec. 31, 2020
OBLIGATIONS WITH FIDC - INVESTMENT FUND IN CREDIT RIGHTS
OBLIGATIONS WITH FIDC - INVESTMENT FUND IN CREDIT RIGHTS	NOTE 23 — OBLIGATIONS WITH FIDC - INVESTMENT FUND IN CREDIT RIGHTS Part of the assets resulting from the favorable judgments of credits with Eletrobrás mentioned in Note 19 iv, were used to set up a Non-Standardized Credit Right Investment Fund, constituted and duly authorized to operate by the Securities and Exchange Commission of Brazil (“FIDC NP Barzel”). On July 14, 2015, the single quota of that FIDC was sold in the acquisition of minority interests’ transaction in subsidiaries of Gerdau S.A. The Company assures the FIDC, through the transfer agreement price adjustments clause, minimum return on the transferred amount of the credit’s rights on the lawsuits. However, where the amounts received in the lawsuits exceed the transferred amount, monetarily adjusted, the Company will be entitled to a percentage of that gain. Additionally, the Company has the right of first offer to repurchase those receivables in the event of sale by the Fund, in accordance to the contract subscribed, and has the amount of R$ 944,513 and R$ 42,893 as of December 31, 2020 recognized in the account “Obligations with FIDC” in the Current liabilities and Non-current liabilities, respectively (R$ 0 and R$ 1,018,501 in December 31, 2019, respectively).

EQUITY

EQUITY	12 Months Ended
	Dec. 31, 2020
EQUITY
EQUITY	NOTE 24 — EQUITY a) Capital The Board of Directors may, without need to change the bylaws, issue new shares (authorized capital), including the capitalization of profits and reserves up to the authorized limit of 1,500,000,000 common shares and 3,000,000,000 preferred shares, all without nominal value. In the case of capital increase through subscription of new shares, the right of preference shall be exercised in up to 30 days, except in the case of a public offering, when the limit is not less than 10 days. Reconciliations of common and preferred outstanding shares are presented below: 2020 2019 2018 Common shares Preferred shares Common shares Preferred shares Common shares Preferred shares Balance at beginning of the year 571,929,945 1,127,010,827 571,929,945 1,124,233,755 571,929,945 1,137,327,184 Acquisition of Treasury shares - - - - - (16,000,000) Exercise of long-term incentive plan - 2,220,660 - 2,777,072 - 1,597,235 Transfer of shares - - - - - 1,309,336 Balance at the end of the year 571,929,945 1,129,231,487 571,929,945 1,127,010,827 571,929,945 1,124,233,755 As of December 31, 2020, 573,627,483 common shares and 1,146,031,245 preferred shares are subscribed and paid up, with a total capital of R$ 19,249,181 (net of share issuance costs). Ownership of the shares is presented below: Shareholders 2020 Shareholders Common % Pref. % Total % Metalúrgica Gerdau S.A. * 557,898,901 97.3 2,147,800 0.2 560,046,701 32.6 Brazilian institutional investors 3,397,955 0.6 227,262,531 19.8 230,660,486 13.4 Foreign institutional investors 3,142,148 0.5 492,076,396 42.9 495,218,544 28.8 Other shareholders 7,490,941 1.3 407,744,760 35.6 415,235,701 24.1 Treasury stock 1,697,538 0.3 16,799,758 1.5 18,497,296 1.1 573,627,483 100.0 1,146,031,245 100.0 1,719,658,728 100.0 Shareholders 2019 Shareholders Common % Pref. % Total % Metalúrgica Gerdau S.A. * 557,898,901 97.3 69,852,184 6.1 627,751,085 36.5 Brazilian institutional investors 3,068,614 0.5 241,698,143 21.1 244,766,757 14.2 Foreign institutional investors 3,875,655 0.7 427,735,548 37.3 431,611,203 25.1 Other shareholders 7,086,775 1.2 387,724,952 33.8 394,811,727 23.0 Treasury stock 1,697,538 0.3 19,020,418 1.7 20,717,956 1.2 573,627,483 100.0 1,146,031,245 100.0 1,719,658,728 100.0 Shareholders 2018 Shareholders Common % Pref. % Total % Metalúrgica Gerdau S.A. * 557,898,901 97.3 95,469,922 8.3 653,368,823 38.0 Brazilian institutional investors 2,383,207 0.4 224,073,547 19.6 226,456,754 13.2 Foreign institutional investors 4,836,488 0.8 410,387,290 35.8 415,223,778 24.1 Other shareholders 6,811,349 1.2 394,302,996 34.4 401,114,345 23.3 Treasury stock 1,697,538 0.3 21,797,490 1.9 23,495,028 1.4 573,627,483 100.0 1,146,031,245 100.0 1,719,658,728 100.0 * Preferred shares do not have voting rights and cannot be redeemed but have the same rights as common shares in the distribution of dividends and also priority in the capital distribution in case of liquidation of the Company. b) Treasury stocks Changes in treasury stocks are as follows: 2020 Common shares R$ Preferred shares R$ Opening balance 1,697,538 557 19,020,418 241,985 Exercise of long-term incentive plan - - (2,220,660) (13,233) Closing balance 1,697,538 557 16,799,758 228,752 2019 Common shares R$ Preferred shares R$ Opening balance 1,697,538 557 21,797,490 279,869 Exercise of long-term incentive plan - - (2,777,072) (37,884) Closing balance 1,697,538 557 19,020,418 241,985 2018 Common shares R$ Preferred shares R$ Opening balance 1,697,538 557 8,704,061 75,528 Repurchases - - 16,000,000 243,396 Exercise of long-term incentive plan - - (1,597,235) (27,433) Transfer of shares - - (1,309,336) (11,622) Closing balance 1,697,538 557 21,797,490 279,869 These shares are held in treasury for subsequent cancellation, selling in the market or to be granted under the long-term incentive plan of the Company. The average acquisition cost of these shares was R$ 13.62 during 2020 (R$ 12.72 and R$ 12.84 during the years ended on December 31, 2019 and 2018, respectively). c) Capital reserves — consists of premium on issuance of shares. d) Retained earnings I) Legal reserves — under Brazilian Corporate Law, the Company must transfer 5% of the annual net income determined on its statutory books in accordance with Brazilian accounting practices to the legal reserve until this reserve equals 20% of the paid-in capital. The legal reserve can be utilized to increase capital or to absorb losses but cannot be used for dividend purposes. II) Tax incentives reserve — under Brazilian Corporate Law, the Company may transfer to this account part of net income resulting from government benefits which can be excluded from the basis for dividend calculation. III) Investments and working capital reserve — consists of earnings not distributed to shareholders and includes the reserves required by the Company’s by-laws. The Board of Directors may propose to the shareholders the transfer of at least 5% of the profit for each year determined in its statutory books in accordance with accounting practices adopted in Brazil to this reserve. Amount can be allocated to the reserve only after the minimum dividend requirements have been met and its balance cannot exceed the amount of paid-in capital. The reserve can be used to absorb losses, if necessary, for capitalization, for payment of dividends or for the repurchase of shares. e) Operations with non-controlling interests — Corresponds to amounts recognized in equity from changes in non-controlling interests. The effects of interest changes in subsidiaries for the years presented are composed of: December 31, 2020 Attributed to parent Non-controlling company’s interest interests Total (i) Other changes - 12,776 12,776 Effects of interest changes in subsidiaries - 12,776 12,776 December 31, 2019 Attributed to parent Non-controlling company’s interest interests Total (i) Other changes - (1,586) (1,586) Effects of interest changes in subsidiaries - (1,586) (1,586) December 31, 2018 Attributed to parent Non-controlling company’s interest interests Total (i) Other changes - (85,483) (85,483) Effects of interest changes in subsidiaries - (85,483) (85,483) (i) Other changes in subsidiaries without losing control, which may include among others, capital increases, other acquisitions of interests and dilutions of any nature. f) Other reserves - Include: gains and losses on available for sale securities, gains and losses on net investment hedge, gains and losses on derivatives accounted as cash flow hedge, cumulative translation adjustments and expenses recorded for stock option plans. g) Dividends and interest on capital - the shareholders have a right to receive a minimum annual mandatory dividend equal to 30% of adjusted net income as determined in its corporate records prepared in accordance with the accounting practices adopted in Brazil. The Company calculates interest on shareholders´ capital in accordance with the terms established by Law 9249/95. The corresponding amount was recorded as a financial expense for tax purposes. For presentation purposes, this amount was recorded as dividends and did not affect net income. The related tax benefit from the reduction in income tax and social contribution on net income was R$ 98,327 (R$ 0 in 2019). 2020 2019 2018 Net income 2,365,763 1,203,736 2,303,868 Constitution of legal reserve (109,649) (55,876) (115,193) Constitution of the tax incentives reserve (172,792) (86,216) (17,051) Net income before dividends and interest on capital 2,083,322 1,061,644 2,171,624 Dividends and interest on capital (714,487) (356,539) (765,339) Net income before constitution of investments and working capital reserve 1,368,835 705,105 1,406,285 Constitution of investments and working capital reserve (1,368,835) (705,105) (1,406,285) The dividends for the year 2020 amounted to R$ 714,487, as shown below: Dividends and interest on capital in the years Outstanding shares Period Nature R$ /share (thousands) Credit Payment 2020 2019 2018 1st quarter Dividends - - - - - 118,803 - 1st quarter Interest - - - - - - 136,152 2nd quarter Dividends - - - - - 118,817 - 2nd quarter Interest - - - - - - 238,293 3rd quarter Dividends 0.12 1,701,161 11/6/2020 11/19/2020 204,139 67,951 221,278 4th quarter Dividends - - - - - 50,968 169,616 4th quarter Interest 0.17 1,701,161 12/21/2020 3/25/2021 289,197 - - 4th quarter Interest 0.13 1,701,161 3/11/2021 3/25/2021 221,151 - - Proposed Interest and Dividends 714,487 356,539 765,339 Credit per share (R$) 0.42 0.21 0.45

EARNINGS (LOSS) PER SHARE (EPS)

EARNINGS (LOSS) PER SHARE (EPS)	12 Months Ended
	Dec. 31, 2020
EARNINGS (LOSS) PER SHARE (EPS)
EARNINGS (LOSS) PER SHARE (EPS)	NOTE 25 — EARNINGS (LOSS) PER SHARE (EPS) The following tables reconcile net income to the amounts used to calculate basic and diluted earnings per share. Basic 2020 Common Preferred Total (in thousands, except share and per share data) Basic numerator Allocated net income available to common and preferred shareholders 795,617 1,570,146 2,365,763 Basic denominator Weighted-average outstanding shares, after deducting the average tresuary shares 571,929,945 1,128,700,478 Earnings per share (in R$) — Basic 1.39 1.39 2019 Common Preferred Total (in thousands, except share and per share data) Basic numerator Allocated net income available to common and preferred shareholders 405,607 798,129 1,203,736 Basic denominator Weighted-average outstanding shares, after deducting the average tresuary shares 571,929,945 1,125,408,180 Earnings per share (in R$) — Basic 0.71 0.71 2018 Common Preferred Total (in thousands, except share and per share data) Basic numerator Allocated net income available to common and preferred shareholders 774,279 1,529,589 2,303,868 Basic denominator Weighted-average outstanding shares, after deducting the average tresuary shares 571,929,945 1,129,851,598 Earnings per share (in R$) — Basic 1.35 1.35 Diluted 2020 2019 2018 Diluted numerator Allocated net income available to Common and Preferred shareholders Net income allocated to preferred shareholders 1,570,146 798,129 1,529,589 Add: Adjustment to net income allocated to preferred shareholders in respect to the potential increase in number of preferred shares outstanding, as a result of long-term incentive plans of Gerdau. 5,524 2,884 6,515 1,575,670 801,013 1,536,104 Net income allocated to common shareholders 795,617 405,607 774,279 Less: Adjustment to net income allocated to preferred shareholders in respect to the potential increase in number of preferred shares outstanding, as a result of long-term incentive plans of Gerdau. (4,782) (2,884) (6,515) 790,835 402,723 767,764 Diluted denominator Weighted - average number of shares outstanding Common Shares 571,929,945 571,929,945 571,929,945 Preferred Shares Weighted-average number of preferred shares outstanding 1,128,700,478 1,125,408,180 1,129,851,598 Potential increase in number of preferred shares outstanding in respect of long-term incentive plan of Gerdau 10,821,083 12,157,614 14,440,860 Total 1,139,521,561 1,137,565,794 1,144,292,458 Earnings per share — Diluted (Common and Preferred Shares) 1.38 0.70 1.34

NET SALES

NET SALES	12 Months Ended
	Dec. 31, 2020
NET SALES
NET SALES	NOTE 26 — NET SALES The net sales revenues for the year are composed of: 2020 2019 2018 Gross sales 49,658,208 44,558,309 51,861,423 Taxes on sales (4,377,135) (3,819,812) (3,793,516) Discounts (1,466,412) (1,094,487) (1,908,429) Net sales 43,814,661 39,644,010 46,159,478

LONG-TERM INCENTIVE PLANS

LONG-TERM INCENTIVE PLANS	12 Months Ended
	Dec. 31, 2020
LONG-TERM INCENTIVE PLANS
LONG-TERM INCENTIVE PLANS	NOTE 27 — LONG-TERM INCENTIVE PLANS a) Quantity Summary of Restricted Shares and Performance Shares: Balance on January 1, 2018 18,975,084 Granted 2,411,345 Cancelled (3,150,635) Exercised (3,974,293) Balance on December 31, 2018 14,261,501 Granted 2,647,995 Cancelled (2,104,754) Exercised (1,786,335) Balance on December 31, 2019 13,018,407 Granted 3,146,696 Cancelled (1,777,100) Exercised (1,918,669) Balance on December 31, 2020 12,469,334 The Company recognizes the cost of the long-term incentive plan through Restricted Shares and Performance Shares based on the fair value of the options granted on the grant date during the vesting period of each grant. The grace period for the year is 3 years for grants made as from 2017 and 5 years for grants made up to 2016. The costs with long-term incentive plans recognized in the income statement on December 31, 2020 were R$ 62,801 (R$ 43,895 and R$ 41,186 on December 31, 2019 and 2018, respectively). As of December 31, 2020, the Company has a total of 16,799,758 preferred shares in treasury and, according to note 24, these shares may be used for serving this plan. b) Stock Options Plan: 2020 2019 2018 Average exercise Average exercise Average exercise Number of shares price in the year Number of shares price in the year Number of shares price in the year R$ R$ R$ Available at beginning of the year - - 15,480 16.72 292,391 17.91 Options Exercised - - - - (33,499) 14.86 Options Forfeited - - (15,480) 16.72 (243,412) 18.62 Available at the end of the year - - - - 15,480 16.72

SEGMENT REPORTING

SEGMENT REPORTING	12 Months Ended
	Dec. 31, 2020
SEGMENT REPORTING
SEGMENT REPORTING	NOTE 28 — SEGMENT REPORTING Business Segments 2020 North America South America Special Steel Eliminations and Brazil Operation Operation Operation Operation Adjustments Consolidated Net sales 17,752,823 17,458,318 3,831,406 6,096,471 (1,324,357) 43,814,661 Cost of sales (14,179,991) (16,212,757) (3,015,189) (5,794,666) 1,318,501 (37,884,102) Gross profit 3,572,832 1,245,561 816,217 301,805 (5,856) 5,930,559 Selling, general and administrative expenses (562,019) (476,518) (116,479) (179,822) (195,547) (1,530,385) Other operating income (expenses) 31,500 97,751 16,684 55,097 916,667 1,117,699 Impairment of non-financial assets - (342,355) - (69,570) - (411,925) Impairment of financial assets (23,177) (36,286) (2,436) (2,233) - (64,132) Equity in earnings of unconsolidated companies (1,287) 23,512 99,341 8,899 22,104 152,569 Operational income before financial income (expenses) and taxes 3,017,849 511,665 813,327 114,176 737,368 5,194,385 Financial result, net (442,972) (206,405) (60,787) (215,433) (773,110) (1,698,707) Income (Loss) before taxes 2,574,877 305,260 752,540 (101,257) (35,742) 3,495,678 Income and social contribution taxes (652,126) (178,447) (195,440) 13,229 (94,840) (1,107,624) Net income (Loss) 1,922,751 126,813 557,100 (88,028) (130,582) 2,388,054 Supplemental information: Net sales between segments 1,149,618 60,370 41 114,328 - 1,324,357 Depreciation/amortization 1,135,294 777,369 142,143 444,298 - 2,499,104 Investments in associates and joint ventures 10,186 908,338 976,046 231,152 145,907 2,271,629 Total assets 21,099,735 18,583,439 5,448,922 11,233,676 6,757,237 63,123,009 Total liabilities 7,469,541 5,261,820 1,360,098 1,994,575 15,951,765 32,037,799 Business Segments 2019 North America South America Special Steel Eliminations and Brazil Operation Operation Operation Operation Adjustments Consolidated Net sales 16,122,171 14,656,028 3,259,253 6,701,900 (1,095,342) 39,644,010 Cost of sales (14,363,253) (13,351,209) (2,762,157) (6,167,502) 1,203,395 (35,440,726) Gross profit 1,758,918 1,304,819 497,096 534,398 108,053 4,203,284 Selling, general and administrative expenses (539,344) (444,326) (119,627) (170,170) (156,989) (1,430,456) Other operating income (expenses) 295,818 44,660 17,416 35,571 55,734 449,200 Impairment of financial assets (2,012) (14,612) (1,906) (2,513) - (21,044) Equity in earnings of unconsolidated companies (828) (110,959) 66,468 6,776 21,493 (17,050) Operational income before financial income (expenses) and taxes 1,512,552 779,582 459,447 404,062 28,291 3,183,934 Financial result, net (520,821) (99,029) (163,459) (109,116) (616,789) (1,509,214) Income (Loss) before taxes 991,731 680,553 295,988 294,946 (588,498) 1,674,720 Income and social contribution taxes (214,400) (188,458) (100,341) (60,749) 106,115 (457,833) Net income (Loss) 777,331 492,095 195,647 234,197 (482,383) 1,216,887 Supplemental information: Net sales between segments 920,659 62,196 - 112,487 - 1,095,342 Depreciation/amortization 1,008,713 571,015 120,462 374,105 - 2,074,295 Investments in associates and joint ventures 11,472 681,807 748,392 224,201 146,527 1,812,399 Total assets 17,195,824 15,178,053 4,562,604 8,597,180 8,469,309 54,002,970 Total liabilities 4,686,686 4,506,771 996,876 1,604,885 15,034,625 26,829,843 Business Segments 2018 North America South America Special Steel Eliminations and Brazil Operation Operation Operation Operation Adjustments Consolidated Net sales 15,745,161 19,927,390 3,801,210 8,158,626 (1,472,909) 46,159,478 Cost of sales (13,044,433) (18,164,834) (3,230,952) (7,064,608) 1,494,727 (40,010,100) Gross profit 2,700,728 1,762,556 570,258 1,094,018 21,818 6,149,378 Selling, general and administrative expenses (569,595) (602,351) (132,245) (180,251) (168,438) (1,652,880) Other operating income (expenses) (33,814) 19,114 (11,421) 10,081 (18,952) (34,992) Impairment of financial assets 5,564 (5,230) (4,462) (5,786) - (9,914) Gains and losses on assets held for sale and sales of interest in subsidiaries - - - - (414,507) (414,507) Equity in earnings of unconsolidated companies (1,700) (77,872) 51,648 15,629 22,436 10,141 Operational (Loss) income before financial income (expenses) and taxes 2,101,183 1,096,217 473,778 933,691 (557,643) 4,047,226 Financial result, net (442,966) (37,351) (117,270) (112,109) (1,180,099) (1,889,795) Income (Loss) before taxes 1,658,217 1,058,866 356,508 821,582 (1,737,742) 2,157,431 Income and social contribution taxes (410,651) (224,897) (86,667) (191,386) 1,082,552 168,951 Net income (Loss) 1,247,566 833,969 269,841 630,196 (655,190) 2,326,382 Supplemental information: Net sales between segments 1,280,770 84,335 4,988 102,816 - 1,472,909 Depreciation/amortization 951,826 511,154 88,537 340,297 - 1,891,814 Investments in associates and joint ventures 3,250 301,271 701,233 213,899 148,149 1,367,802 Total assets 17,473,039 14,659,926 4,421,487 8,825,830 5,900,747 51,281,029 Total liabilities 8,072,380 4,935,210 1,053,007 1,736,085 9,545,776 25,342,458 The main products sold in each segment are: Brazil Operations: rebar, bars, shapes, drawn products, billets, blooms, slabs, wire rod, structural shapes and iron ore. North America Operations: rebar, bars, wire rod, light and heavy structural shapes. South America Operations: rebar, bars and drawn products. Special Steel Operations: stainless steel, round, square and flat bars, wire rod. The column of eliminations and adjustments includes the elimination of sales between segments in the context of the Consolidated Financial Statements. The Company’s geographic information with revenues classified according to the geographical region where the products were shipped is as follows: Geographic Area Brazil Latin America (1) North America (2) Europe/Asia Consolidated 2020 2020 2020 2020 2020 Net sales 18,798,384 4,996,434 20,019,843 - 43,814,661 Total assets 28,752,629 7,042,462 27,327,918 - 63,123,009 Geographic Area Brazil Latin America (1) North America (2) Europe/Asia Consolidated 2019 2019 2019 2019 2019 Net sales 17,573,278 4,201,165 17,869,567 - 39,644,010 Total assets 26,124,159 5,781,527 22,097,284 - 54,002,970 Geographic Area Brazil Latin America (1) North America (2) Europe/Asia Consolidated 2018 2018 2018 2018 2018 Net sales 17,284,473 4,785,281 23,524,381 565,343 46,159,478 Total assets 26,283,287 5,251,637 19,746,105 - 51,281,029 (1) Does not include operations of Brazil (2) Does not include operations of Mexico IFRS requires the Company to disclose revenue per product and country unless the information is not available and the cost to obtain it would be excessive. Management does not consider this information useful for its decision-making process, because it would aggregate sales in different markets and in different currencies, subject to the effects of changes in exchange rates. Furthermore, the trends of steel consumption and the price dynamics of each product or group of products in different countries and different markets within these countries are poorly correlated and, as a result, the information would not be useful and would not serve to conclude about historical trends. Considering this scenario and considering that the information of revenue by product is not maintained by the Company on a consolidated basis and the cost to obtain the revenue per product information would be excessive compared to the benefits of the information, the Company does not present revenue by product.

INSURANCE

INSURANCE	12 Months Ended
	Dec. 31, 2020
INSURANCE
INSURANCE	NOTE 29 — INSURANCE The subsidiaries have insurance coverage determined by management with the assistance of specialists’ advice, taking into consideration the nature and the level of risk, in amounts that cover significant losses on their assets and/or liabilities. The main types of insurance are as follows: Type Scope 2020 2019 Assets Inventories and property, plant and equipment items are insured against fire, electrical damage, explosion, machine breakage and overflow (leakage of material in fusion state). 82,836,077 61,187,789 Business Interruption Net income plus fixed expenses 11,146,083 11,381,183 Civil Liability Industrial operations 711,948 652,973

IMPAIRMENT OF ASSETS

IMPAIRMENT OF ASSETS	12 Months Ended
	Dec. 31, 2020
IMPAIRMENT OF ASSETS
IMPAIRMENT OF ASSETS	NOTE 30 — IMPAIRMENT OF ASSETS The Company performs tests for impairment of assets, notably goodwill and other long-lived assets, based on projections of discounted cash flows, which take into account assumptions such as: cost of capital, growth rate and adjustments applied to flows in perpetuity, methodology for working capital determination, investment plans, and long-term economic-financial forecasts. The impairment test of these assets are assessed based on the analysis of facts or circumstances that may indicate the need to perform the impairment test and are performed at least annually, for groups of cash generating units containing goodwill, in December, or whenever changes in events or circumstances indicate that the goodwill and other long-lived assets may be impaired. To determine the recoverable amount of each cash generating unit, the Company uses the discounted cash flow method, using as basis, financial and economic projections for each one. The projections are prepared by taking into consideration observed changes in the economic scenario in the market where the Company operates, as well as assumptions with respect to future results and the historical profitability of each segment. The Company maintains its monitoring of the steel market in order to identify any deterioration, significant drop in demand from steel consuming sectors (notably automotive and construction), stoppage of industrial plants or relevant changes in the economy or financial market that result in increased perception of risk or reduction of liquidity and refinancing capacity. 30.1 Other assets Impairment test In the fourth quarter of 2020, due to the lack of expectation of future use of some assets in two industrial plants, tests performed on other long-lived assets identified impairment losses in property, plant and equipment in the amount of R$ 411,925, of which R$ 69,570 in the Special Steel Segment and R$ 342,355 in the North America Segment, resulting from a recoverable amount below the book value. These losses were determined based on the difference between the book value and the recoverable amount of these assets, which represents their value in use (higher between the fair value net of disposal expenses and their value in use). These losses were recorded in the line of Impairment of non-financial assets in the Consolidated Statements of Income. In 2019 and 2018, no impairment losses were recognized for other long-lived assets. The post-tax discount rates used for this test are the same as presented in note 30.2 of the goodwill impairment test. 30.2 Goodwill impairment test The Company has four operating segments, which represents the lowest level in which goodwill is monitored by the Company. In 2020, 2019 and 2018, no impairment losses were recognized for goodwill. The period for projecting the cash flows for the goodwill impairment test was five years. The assumptions used to determine the value in use based on the discounted cash flow method include analysis prepared in dollars, such as: projected cash flows based on management estimates for future cash flows, exchange rates, discount rates and growth rates on perpetuity. The cash flow projections already reflect a more challenging competitive scenario than projected in previous years, resulting from a deterioration in the steel consuming markets and overcapacity in the industry, as well as macroeconomic challenges in some geographies in which the Company operates. The perpetuity was calculated considering stable operating margins, levels of working capital and investments. The perpetuity growth rates considered in the 2020 test were: a) North America: 3% (3% in December 2019); b) Special Steel: 3% (3% in December 2019); c) South America: 3% (3% in December 2019); and d) Brazil: 3% (3% in December 2019). The post-tax discount rates used were determined taking into consideration market information available on the date of performing the impairment test. The Company adopted distinct rates for each business segment tested with the purpose of reflecting the differences among the markets in which each segment operates, as well as the risks associated to each of them. The post-tax discount rates used were: a) North America: 8.25% (10.0% in December 2019); b) Special Steel: 8.75% (10.5% in December 2019); c) South America: 11.25% (14.25% in December 2019); and d) Brazil 9.75%: (11.25% in December 2019). Discounted cash flows are compared to the book value of each segment and result in the recoverable amount as shown below: a) North America: exceeded the book value by R$ 6,202 million (exceeded the book value by R$ 2,690 million in 2019); b) South America: exceeded the book value by R$ 4,141 million (exceeded the book value by R$ 521 million in 2019); c) Special Steel: exceeded the book value by R$ 2,509 million (exceeded the book value by R$ 2,813 million in 2019); and d) Brazil: exceeded the book value by R$ 13,424 million (exceeded the book value by R$ 4,015 million in 2019). The Company performed a sensitivity analysis in the assumptions of discount rate and perpetuity growth rate, due to the potential impact in the discounted cash flows. An increase of 0.5 percentage points in the discount rate of each segment’s cash flow would result in a recoverable amount that exceeded the book value as shown below: a) North America: exceeded book value by R$ 4,589 million (exceeded the book value by R$ 1,884 million in 2019); b) Special Steel: exceeded book value by R$ 1,568 million (exceeded the book value by R$ 2,207 million in 2019); c) South America: exceeded book value by R$ 3,757 million (exceeded the book value by R$ 414 million in 2019); and d) Brazil: exceeded the book value by R$ 11,348 million (exceeded the book value by R$ 2,810 million in 2019). On the other hand, a decrease of 0.5 percentage points in the perpetuity growth rate of the cash flow of each business segment would result in a recoverable amount that exceeded the book value as shown below: a) North America: exceeded the book value by R$ 4,914 million (exceeded the book value by R$ 2,098 million in 2019); b) Special Steel: exceeded the book value by R$ 1,754 million (exceeded the book value by R$ 2,369 million in 2019); c) South America: exceeded the book value by R$ 3,867 million (exceeded the book value by R$ 455 million in 2019); and d) Brazil: exceeded the book value by R$ 11,809 million (exceeded the book value by R$ 3,115 million in 2019). The Company will maintain over the next year its constant monitoring of the steel market in order to identify any deterioration, significant drop in demand from steel consuming sectors (notably automotive and construction), stoppage of industrial plants or activities relevant changes in the economy or financial market that result in increased perception of risk or reduction of liquidity and refinancing capacity. Although the projections made by the Company provide a more challenging scenario than that in recent years, the events mentioned above, if manifested in a greater intensity than that anticipated in the assumptions made by management, may lead the Company to revise its projections of value in use and eventually result in impairment losses.

EXPENSES BY NATURE

EXPENSES BY NATURE	12 Months Ended
	Dec. 31, 2020
EXPENSES BY NATURE
EXPENSES BY NATURE	NOTE 31 — EXPENSES BY NATURE The Company opted to present its Consolidated Income Statement by function. As required by IAS 1, the expenses classified by nature are as follows: 2020 2019 2018 Depreciation and amortization (2,499,104) (2,074,295) (1,891,814) Labor expenses (5,867,265) (5,175,373) (5,724,352) Raw material and consumption material (26,945,440) (25,890,618) (29,623,418) Freight (2,572,293) (2,300,439) (2,770,516) Impairment of non-financial assets (411,925) - - Gains and losses on assets held for sale and sales of interest in subsidiaries - - (414,507) Other expenses/income, net (476,818) (1,002,301) (1,697,786) (38,772,845) (36,443,026) (42,122,393) Classified as: Cost of sales (37,884,102) (35,440,726) (40,010,100) Selling expenses (512,950) (476,339) (570,431) General and administrative expenses (1,017,435) (954,117) (1,082,449) Other operating income 1,763,684 636,847 235,421 Other operating expenses (645,985) (187,647) (270,413) Impairment of financial assets (64,132) (21,044) (9,914) Impairment of non-financial assets (411,925) - - Gains and losses on assets held for sale and sales of interest in subsidiaries - - (414,507) (38,772,845) (36,443,026) (42,122,393)

FINANCIAL INCOME

FINANCIAL INCOME	12 Months Ended
	Dec. 31, 2020
FINANCIAL INCOME
FINANCIAL INCOME	NOTE 32 — FINANCIAL INCOME 2020 2019 2018 Income from short-term investments 108,057 87,241 68,721 Interest income and other financial income 86,035 135,972 135,279 Financial Income 194,092 223,213 204,000 Interest on debt (1,022,460) (938,120) (1,177,686) Monetary variation and other financial expenses (426,001) (531,634) (401,655) Financial Expenses (1,448,461) (1,469,754) (1,579,341) Bonds repurchases (239,273) - (223,925) Exchange Variation, net (204,291) (247,555) (322,621) Gains and losses on derivative financial instruments, net (774) (15,118) 32,092 Financial result, net (1,698,707) (1,509,214) (1,889,795)

SUMMARY OF SIGNIFICANT ACCOUN_2

SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES (Policies)	12 Months Ended
	Dec. 31, 2020
SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES
Basis of Presentation	2.1 — Basis of Presentation The Company’s Consolidated Financial Statements have been prepared in accordance and are in compliance with the International Financial Reporting Standards (IFRS) issued by International Accounting Standards Board (IASB). The preparation of the Consolidated Financial Statements in accordance with IFRS requires Management to make accounting estimates. The areas that involve judgment or use of estimates relevant to the Consolidated Financial Statements are stated in Note 2.17. The Consolidated Financial Statements have been prepared using historical cost as its basis, except for the valuation of certain financial instruments, which are measured at fair value. The Company adopted all applicable standards and revisions of standards and interpretations issued by the IASB or the IFRS Interpretations Committee that are effective as of December 31, 2020. a) Investments in Subsidiaries The Company’s consolidated financial statements include the financial statements of Gerdau S.A. and all its subsidiaries. The Company controls an entity when it is exposed or has the right to variable returns arising from their involvement with the entity and has the ability to affect those returns due to the power exercised over the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Company. They are deconsolidated from the date that control ceases. Third parties’ interests in equity and net income of subsidiaries are reported separately in the consolidated balance sheet and in the consolidated statement of income, respectively, under the account “Non-controlling interests”. For business combinations, the assets, liabilities, and contingent liabilities of a subsidiary are reported at their respective fair value on the date of acquisition. Any excess of the acquisition cost over the fair value of the identifiable net assets acquired is recorded as goodwill. When the acquisition cost is less than the fair value of the net assets identified, the difference is recorded as a gain in the statement of income for the year in which the acquisition took place. The non-controlling interests are presented based on the proportion of the fair value of the identified assets and liabilities acquired. Intercompany transactions and balances are eliminated in the consolidation process. Gains or losses resulting from transactions among consolidated entities of the Company are also eliminated. b) Investments in Joint ventures and Associate companies Joint ventures are those in which the control is held jointly by the Company and one or more partners. An associate company is one in which the Company exercises significant influence, but over which it does not have control. Investments in joint ventures and associate companies are recorded under the equity accounting method. c) Equity in Earnings of Unconsolidated Companies According to this method, investments are recognized in the consolidated balance sheet at acquisition cost and are adjusted subsequently based on the Company’s share in the earnings and in other changes in the net assets of the Associates and Joint Ventures. The balances of the investments can also be reduced due to impairment losses. Furthermore, dividends received from these companies are recorded as reductions in the value of the investments.
Foreign Currency Translation	2.2 —Foreign Currency Translation a) Functional and Reporting Currency The functional currency of an entity is the currency of the primary economic environment where it operates. The Consolidated Financial Statements are presented in Brazilian Reais (R$), which is the functional and reporting currency of the Company. All balances were rounded to the nearest thousand, unless otherwise stated. b) Transactions and Balances For purposes of the Consolidated Financial Statements, the balances of each subsidiary of the Company are converted into Brazilian reais, which is the functional currency of the Company and the reporting currency of its Consolidated Financial Statements, at the exchange rates at the dates of the transactions. c) Translation of financial statements in foreign currency The results of operations and financial position of all subsidiaries included in the consolidated financial statements, along with equity investments, which have functional currencies different from the Company’s reporting currency are translated into the reporting currency as follows: i) Asset and liability balances are translated at the exchange rate in effect at the balance sheet date; ii) Income and expenses are translated using the average monthly exchange rates for the year; iii) Translation gains and losses resulting from the above methodology are recognized in Equity, in the Statement of Comprehensive Income, in the account named “Other reserves - Cumulative translation adjustment”; and iv) The amounts presented in the cash flow are extracted from the converted changes in assets, liabilities and results. d) Hyperinflation in Venezuela and Argentina Argentina and Venezuela are considered countries with hyperinflation and for this reason, the Financial Statements of the subsidiaries located in these countries are being updated so that their values are shown in the monetary unit of measurement at the end of the year, which considers the effects measured by the inflation rates in these countries.
Financial Assets	2.3 — Financial Assets At initial recognition, a financial asset is classified as measured at amortized cost, at fair value through profit or loss or at fair value through other comprehensive income. Financial assets are not reclassified subsequent to initial recognition, unless the Company changes the business model for the management of financial assets. The Company performs an evaluation of the business model objective in which a financial asset is held in the portfolio because this better reflects the way in which the business is managed. a) Financial assets at amortized cost These assets are measured subsequently to initial recognition at the amortized cost using the effective interest method. The amortized cost is reduced by impairment losses. Interest income, foreign exchange gains and losses and impairment are recognized directly in income. Any gain or loss on derecognition is recognized on statement of income. b) Financial assets measured at fair value through profit or loss These assets are measured subsequently to initial recognition at the fair value. The net result, including interest, is recognized directly in income. c) Financial assets measured at fair value through other comprehensive income These assets are measured subsequently to initial recognition at fair value. Interest income calculated using the effective interest method, exchange gains and losses and impairment are recognized in the statement of income. Other net results are recognized in other comprehensive income. In derecognition, the accumulated result in other comprehensive income is reclassified to the statement of income. d) Impairment of financial assets I) Impairment of financial assets as from January 1, 2019 The Company measures the impairment of financial assets in an amount equal to the Expected credit loss. In determining whether the credit risk of a financial asset has increased significantly since the initial recognition and in estimating the expected credit losses, the Company considers reasonable and supportable information that is relevant and available without undue cost or effort. This includes quantitative and qualitative information and analysis, based on the Company’s historical experience, credit assessment and considering forward-looking information. The impairment loss of financial assets was calculated based on the credit risk analysis, which includes the historical losses, the individual situation of the clients, the situation of the economic group to which they belong, the real guarantees for the debts and the evaluation of the legal advisors and is considered sufficient to cover possible losses on amounts receivable, in addition to a prospective assessment that takes into account the change or expectation of change in economic factors that affect expected credit losses, which will be determined based on probabilities weighted. The Company presents the impairment of the financial assets in the Statement of Income in the line of Impairment of financial assets. II) Impairment of financial assets as of and for year ended December 31, 2018 The Company measures the allowance for doubtful accounts in an amount equal to the expected loss of credit. In determining whether the credit risk of a financial asset has increased significantly since the initial recognition and in estimating the expected credit losses, the Company considers reasonable and bearable information that is relevant and available at no charge or over-effort. This includes quantitative and qualitative information and analysis, based on the Company's historical experience, credit assessment and considering forward-looking information. The provision for credit risks was calculated based on the credit risk analysis, which includes the historical losses, the individual situation of the clients, the situation of the economic group to which they belong, the real guarantees for the debts and the evaluation of the legal advisors and is considered sufficient to cover possible losses on amounts receivable, in addition to a prospective assessment that takes into account the change or expectation of change in economic factors that affect expected credit losses, which will be determined based on probabilities weighted. e) Derecognition The Company derecognizes a financial asset when expire the contractual rights of the cash flows of the asset, or when the Company transfers the contractual rights of that cash flows in a transaction in which substantially all the risks and benefits of the financial asset are transferred or in which the Company neither transfers nor maintains substantially all the risks and benefits of the financial asset and also does not retain control over the financial asset. f) Compensation Financial assets and liabilities are offset, and the net amount presented in the balance sheet when, and only when, the Company currently has a legally enforceable right to offset the amounts and intends to settle them on a net basis or to realize the asset and settle the liability simultaneously. g) Financial Instruments A financial asset is measured at amortized cost if it meets both of the following conditions and is not designated as measured at fair value through profit or loss: it is maintained within a business model whose objective is to maintain financial assets to receive contractual cash flows; and its contractual terms generate, at specific dates, cash flows that are related only to payment of principal and interest outstanding amounts. A debt instrument is measured at fair value through other comprehensive income if it meets both of the following conditions and is not designated as measured at fair value through profit or loss: it is maintained within a business model whose objective is achieved both by receipt of contractual cash flows and sale of financial assets; and its contractual terms generate, on specific dates, cash flows that are only payments of principal and interest on the outstanding principal amount. In the initial recognition of an investment in an equity instrument that is not held for trading, the Company may irrevocably choose to present subsequent changes in the fair value of the investment in other comprehensive income. This choice is made investment by investment. The Company performs an evaluation of the business model objective in which a financial asset is held in the portfolio because this better reflects the way in which the business is managed, and the information is provided to Management. The information considered includes: the policies and objectives stipulated for the portfolio and the practical operation of those policies. They include the question of whether Management’s strategy focuses on obtaining contractual interest income, maintaining a certain interest rate profile, matching the duration of financial assets with the duration of related liabilities or expected outflows of cash, or the realization of cash flows through the sale of assets; how the performance of the portfolio is evaluated and reported to the Company’s Management; the risks that affect the performance of the business model (and the financial asset held in that business model) and the manner in which those risks are managed; the frequency, volume and timing of sales of financial assets in prior periods, the reasons for such sales and their expectations about future sales. h) Evaluation on whether contractual cash flows are only payments of principal and interest For the purposes of this valuation, the ‘principal’ is defined as the fair value of the financial asset at the initial recognition. ‘Interest’ is defined as a consideration for the time value of money and for the credit risk associated with the principal amount outstanding over a given period of time and for the other underlying risks and costs of borrowing (e.g. liquidity risk and costs administrative costs), as well as a profit margin. The Company considers the contractual terms of the instrument to assess whether contractual cash flows are only principal and interest payments. This includes assessing whether the financial asset contains a contractual term that could change the timing or value of the contractual cash flows so that it would not meet that condition. In making this assessment, the Company considers: contingent events that modify the value or the time of cash flows; terms that may adjust the contractual rate, including variable rates; the prepayment and the extension of the term; and terms that limit the Company’s access to cash flows of specific assets (for example, based on the performance of an asset). The prepayment is consistent with the principal and interest payments criterion if the prepayment amount represents, for the most part, unpaid principal and interest amounts on the outstanding principal amount - which may include additional compensation the early termination of the contract.
Inventories	2.4 — Inventories Inventories are measured at the lower of historical cost of acquisition or production and net realizable value. The acquisition and production costs include transportation, storage and non-recoverable taxes. Net realizable value is the estimated sale price in the ordinary course of business less the estimated costs of completion and selling expenses directly related. Information regarding the allowance for adjustments to net realizable value is presented in note 6.
Property, Plant and Equipment	2.5 — Property, Plant and Equipment Property, plant and equipment are stated at historical cost, monetarily adjusted when applicable, less depreciation, except for land, which is not depreciated. The Company recognizes monthly to the construction costs of qualified assets, which are assets that, necessarily, require a substantial period of time to be finished for its intended use, the borrowing costs as part of the acquisition cost of the property, plant and equipment under construction based on the following capitalization criteria: (a) the capitalization period begins when the property, plant and equipment item is under construction in process and the capitalization of borrowing costs ceases when the asset is available for use; (b) borrowing costs are capitalized considering the weighted average rate of loans existing on the capitalization date or a specific rate, in the case of loans for the acquisition of property, plant and equipment; (c) borrowing costs capitalized do not exceed the interest expenses during the capitalization period; and (d) capitalized borrowing costs are depreciated considering the same criteria and useful life determined for the property, plant and equipment item to which it was capitalized. Depreciation is calculated under the straight-line method at rates that take into consideration the estimated useful life of the asset, its level of utilization and the estimated residual value of the asset at the end of its useful life. The estimated residual value and useful life of the assets are reviewed and adjusted, if necessary, at each year-end. Subsequent costs are added to the carrying amount of property, plant and equipment or recognized as a specific item, as appropriate, only if the economic benefits associated to these items are probable and the amounts can be reliably measured. The carrying amount of replaced items is written-off. Other repairs and maintenance are recognized directly in income when incurred. Mining exploration rights are classified as Land and Buildings in the Property, plant and equipment account. Exploration expenditures are recognized as expenses until the feasibility of mining activity is established and thereafter subsequent costs are capitalized. Costs for the development of new iron ore reserves or to expand the capacity of operating mines are capitalized and amortized based on the amount of iron ore extracted. Stripping costs (costs associated with removal of waste and other residual materials) incurred during the development phase of a mine, before production phase, are registered as part of the depreciable cost of asset. Subsequently, these costs are depreciated over the useful life of the mine. Spending on waste removal, after the start of production of the mine, are treated as production costs. Depletion of mines is calculated based on the amount of ore extracted. The net book value of property, plant and equipment items is immediately impaired to its recoverable amount when the residual balance exceeds the recoverable amount.
Goodwill	2.6 — Goodwill Goodwill represents the excess of the acquisition cost over the fair value net of the assets acquired, liabilities assumed and identifiable contingent liabilities of a subsidiary, joint venture, or associate company, at the respective acquisition date. Goodwill is recorded as an asset and recorded under “Goodwill” account. Goodwill is not amortized and is subject to impairment tests annually or whenever there are indications of potential impairment. Any impairment loss is recorded as an expense in the income statement and cannot be reversed. Goodwill is allocated to the operating segments, which represents the lowest level at which goodwill is monitored by management. Goodwill that forms part of the carrying amount of an investment in an associate or a joint venture is not separately recognized. The entire carrying amount of the investment in associate or joint venture is tested for impairment as a single asset, by comparing its recoverable amount (higher of value in use and fair value less costs to sell) with it carrying amount. When a subsidiary, joint venture or associate is sold, goodwill is included in the determination of gains and losses on disposal.
Other Intangible Assets	2.7 — Other Intangible Assets Other intangible assets are stated at acquisition cost, less accumulated amortization and impairment losses, when applicable. Intangible assets consist mainly of assets which represent the capacity to generate economic benefits from companies acquired based on relationships with customers and suppliers, software and others. Intangible assets with definite useful lives are amortized taking into consideration their actual use or a method that reflects their consumption of economic benefits. The net book value of intangible assets is impaired immediately to its recoverable value when the residual balance exceeds the recoverable amount (note 2.8). Intangible assets acquired in a business combination are recorded at fair value, less accumulated amortization and impairment losses, when applicable. Intangible assets that have a defined useful life are amortized over their useful lives using an amortization method that reflects the economic benefit of the intangible asset and is recorded in the cost of sales account. The intangible relationship with customers and suppliers is amortized based on an accelerated method that considers the expected future economic benefit provided over time by these new acquired customers and suppliers. The Company reviews the amortization period and amortization method for its intangible assets with definite useful lives at the end of each year.
Provision for Impairment of Assets and Reversal of Impairment	2.8 — Provision for Impairment of Assets and Reversal of Impairment At each balance sheet date, the Company performs an assessment to determine whether there is evidence that the carrying amount of long-lived assets might be impaired. If such evidence is identified, the recoverable amount of the assets is estimated by the Company. The recoverable amount of an asset is determined as the higher of: (a) its fair value less estimated costs to selling and (b) its value in use. The value in use is measured based on discounted cash flows (before taxes) derived from the continuous use of the asset until the end of its estimated useful life. Regardless of whether or not there is any indication that the carrying amount of the asset may be impaired, the balances of goodwill arising from business combinations and intangible assets with indefinite useful lives are tested for impairment at least once a year in December. When the carrying amount of the asset exceeds its recoverable amount, the Company recognizes a reduction in the book value of the asset (Impairment). The reduction to the recoverable amount of the asset is recorded as an expense. Except for an impairment of goodwill, a reversal of a previously recorded impairment loss is required. Reversal in these circumstances is limited to the amount of the depreciated balance of the asset at the time of the reversal, determined as if the impairment had not been recorded, as discussed in note 30.1. The Company does not believe there is a reasonable likelihood that may occur a material change in the estimates or assumptions used to calculate long-lived asset impairment losses. However, if actual results are not consistent with estimates and assumptions used in estimating future cash flows and asset fair values, the Company may be exposed to losses that could be material.
Financial Liabilities and Equity Instruments	2.9 — Financial Liabilities and Equity Instruments a) Financial liabilities Financial liabilities are classified as amortized cost or at fair value through profit or loss. A financial liability is classified as fair value through profit or loss if it is classified as held for trading, it is a derivative, or it is designated as such at initial recognition. Financial liabilities measured at fair value through profit or loss are measured at fair value and the net result, including interest, is recognized in the income statement. Other financial liabilities are subsequently measured at amortized cost using the effective interest method. Interest expense, exchange gains and losses are recognized in income. b) Derecognition The Company derecognizes a financial liability when its contractual obligation is withdrawn, canceled or expired. The Company also derecognizes a financial liability when the terms are modified and the cash flows of the modified liability are substantially different, in which case a new financial liability based on the modified terms is recognized at fair value. In the derecognition of a financial liability, the difference between the carrying amount extinguished and the consideration paid (including any non-cash assets transferred or liabilities assumed) is recognized in the income statement. c) Derivative Instruments and hedging The Company enters into derivative financial instruments mainly to manage its exposure to fluctuation in interest rates and exchange rates. The Company measures its derivative financial instruments, based on quotations obtained from market participants, at fair value at the balance sheet date. Changes in the fair value of a derivative that is highly effective and that is designated and qualifies as a cash flow hedge or a net investment hedge are recorded in the statement of comprehensive income. The Company assesses, both at the beginning of hedge coverage and on an ongoing basis, whether the derivatives used in hedge transactions are highly effective in offsetting changes in the fair value or cash flows of hedged items. When a cash flow hedge instrument is sold, terminated, expired or exercised, the hedge is discontinued prospectively, but the cumulative unrealized gain or loss is recognized in the comprehensive income statement. The cumulative gain and loss is transferred from the comprehensive income and recognized in the income statement when the hedged transaction is recognized in the statement of income. When no more than one transaction is expected to occur, the accumulated gain or loss is immediately transferred to the income statement. In cases of net investment hedges, the amount recorded in the statement of comprehensive income is written off and recognized in the statement of income when the disposal of the hedged investment occurs. In addition, changes in the fair value of financial instruments not characterized as hedges are recognized in the line of (Loss) Gains on financial instruments, net, in the statement of income. d) Equity instruments The equity component is initially recognized by the difference between the fair value of the compound financial instrument as a whole and the fair value of the liability component. Any directly attributable transaction costs are allocated to the liability and equity components in proportion to their initial carrying amounts.
Current and Deferred Income and Social Contribution Taxes	2.10 — Current and Deferred Income and Social Contribution Taxes Current income and social contribution tax expense is calculated in conformity with enacted tax rate in effect at the balance sheet date in the countries where the Company’s subsidiaries, associates and joint venture operate and generate taxable income. Management periodically evaluates positions taken in relation to tax matters which are subject to interpretation and recognizes a provision when there is an expectation of payment of income tax and social contribution in accordance with the tax bases. The expense for income tax and social contribution taxes comprises current and deferred taxes. Current tax and deferred tax are recognized in income unless they are recognized for a business combination, or for items directly recognized in equity through other comprehensive income. Current tax is the estimated tax payable or receivable on the taxable income or loss for the year, at the tax rates effective at the balance sheet date. Deferred income tax and social contribution are recognized in its total on the differences generated between assets and liabilities recognized for tax purposes and corresponding to amounts recognized in the Financial Statements. However, deferred income and social contribution taxes are not recognized arising from the initial recognition of assets and liabilities in a transaction other than a business combination and that do not affect the tax basis. Income and social contribution taxes are determined based on tax rates (and laws) effective at the balance sheet date and applicable when the respective income and social contribution taxes is paid. Deferred income and social contribution tax assets are recognized only to the extent that it is probable that there will be taxable income for which the temporary differences can be used, and tax losses can be compensated. Deferred tax assets recorded for tax loss carryforwards are supported by projections of taxable income based on technical feasibility studies submitted annually to the Board of Directors of the Company and its subsidiaries, when applicable. These studies consider historical profitability of the Company and its subsidiaries, expectations of continuous profitability and estimates of the recovery of deferred tax assets over future years. Other deferred tax assets arising from temporary differences, mainly tax provision, are recognized according to their estimate of realization. Deferred income tax and social contribution assets are reviewed at each reporting date and will be reduced to the extent that their realization is not more likely than not based on future taxable income. The Company recognizes a provision for tax matters only if a past event gives rise to a present obligation. The Company determines whether a present obligation exists at the end of the year considering all available evidence, including, for example, the opinion of legal advisors. The Company also considers whether it is more likely than not that there will be an outflow of assets and whether a reliable estimate can be made.
Employee Benefits	2.11 — Employee Benefits The Company has several employee benefit plans including pension and retirement plans, health care benefits, profit sharing, bonus, and share-based payment, as well as other retirement and termination benefits. The main benefit plans granted to the Company’s employees are described at notes 21 and 27. The actuarial obligations related to the pension and retirement benefits and the actuarial obligations related to the health care plans are recorded based on actuarial calculations performed every year by independent actuaries, using the projected unit credit method, net of the plan assets, when applicable, and the related costs are recognized over the employees’ service period. Any employee benefit plan surpluses are also recognized up to the probable amount of reduction in future contributions by the Company. Actuarial remeasurement arising from adjustments and changes in actuarial assumptions of the pension and retirement benefit plans and actuarial obligations related to the health care plan are recognized directly in the Statement of Comprehensive Income as described in Note 21. In accounting for pension and post-retirement benefits, several statistical and other factors that attempt to anticipate future events are used to calculate plan expenses and liabilities. These factors include discount rate assumptions, return on plan assets, future increases in health care costs, and rate of future compensation increases. In addition, the Company and its actuarial uses other factors whose measurement involves judgment are used such as withdrawal, turnover, and mortality rates. The actuarial assumptions used by the Company may differ materially from actual results in future periods due to changing market and economic conditions, regulatory events, judicial rulings, higher or lower withdrawal rates, or longer or shorter participant life spans.
Other Current and Non-current Assets and Liabilities	2.12 — Other Current and Non-current Assets and Liabilities Other current and non-current assets and liabilities are recorded at their realizable amounts (assets) and at their known or estimated amounts plus accrued charges and monetary adjustments (liabilities), when applicable.
Related-Party Transactions	2.13 — Related-Party Transactions Loan agreements between the entities in Brazil and abroad are adjusted by contractual financial charges plus foreign exchange variation, when applicable. These contracts have an expiration date, with the possibility of extension of time by agreement between the parties. Sales and purchases of raw materials and products are made under terms and conditions contractually established between the parties.
Dividends and Interest on equity	2.14 — Dividends and Interest on equity Dividend payments are recognized as liabilities at the time dividends are approved by the shareholders of Gerdau S.A. The bylaws of Gerdau S.A. required dividends of not less than 30% of the annual net income adjusted by 5% representing the constitution of legal reserve, and the constitution of tax incentives reserve; therefore, Gerdau S.A. records a liability at year-end for the minimum dividend amount that has not yet been paid during the year up to the limit of the mandatory minimum dividend described above.
Revenue Recognition	2.15 — Revenue Recognition Net sales are presented net of taxes and discounts. Revenues from sales of products are recognized to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The related costs of freight are included in cost of sales.
Investments in Environmental Protection and Environmental liabilities	2.16 — Investments in Environmental Protection and Environmental liabilities Environmental costs that relate to current operations are expensed or capitalized as appropriate. Environmental costs that relate to an existing condition caused by past operations, and which do not contribute to current or future revenue generation or cost reduction are recorded as expense. Liabilities are recorded when environmental assessments or remedial efforts are probable, and the cost can be reasonably estimated based on discussions with the environmental authorities and other assumptions relevant to the nature and extent of the remediation that may be required. The ultimate cost to the Company is dependent upon factors beyond its control such as the scope and methodology of the remedial action requirements to be established by environmental and public health authorities, new laws or government regulations, rapidly changing technology and the outcome of any potential related litigation. Environmental liabilities are adjusted to present value when the aggregate amount of the obligation and the amount and timing of cash disbursements are established or can be reliably estimated.
Use of Estimates	2.17 — Use of Estimates The preparation of the Consolidated Financial Statements requires estimates to record certain assets, liabilities and other transactions. To make these estimates, Management uses the best information available on the date of preparation of the Consolidated Financial Statements and the experience of past and/or current events, also considering assumptions related to future events. As such, the Consolidated Financial Statements include estimates with respect to the recoverable amount of long-lived assets (note 30), with respect to the need and the amount of provisions for tax, civil and labor liabilities (note 19), recoverability of deferred tax assets (note 8),estimates in selecting interest rates, return on assets, mortality tables and expectations for salary increases (note 21), and long-term incentive plans through the selection of the evaluation model and rates (note 27). Actual results could differ from those estimates.
Business Combinations for the Financial Statements	2.18 — Business Combinations for the Financial Statements a) Step-acquisitions in which control is obtained When a business combination is achieved in stages, the interest previously held by the Company in the acquired entity is remeasured at fair value at acquisition date (i.e. the date when the Company acquires the control) and the resulting gain or loss, if any, is recognized in profit or loss. Amounts related to the Company’s interest in the acquired company before the acquisition date, and that were recognized in “Other comprehensive income,” are reclassified to profit or loss, where such treatment would be appropriate if that interest were disposed of. b) Acquisitions in which control is obtained initially Acquisitions of businesses are accounted for under the acquisition method. The cost of the acquisition is measured at the fair values (at the date of the transaction) of the assets transferred, liabilities incurred or assumed, and equity instruments issued by the Company in exchange for control of the acquired business entity. The acquiree’s identifiable assets, liabilities and contingent liabilities are recognized at their fair values at the acquisition date. The interest of non-controlling shareholders in the acquiree is initially measured at the non-controlling shareholders’ proportion of the net fair value of the assets, liabilities and contingent liabilities recognized. Expenses related to the acquisition are recognized in the income statement when incurred. c) Increases/decreases in non-controlling interests Subsequent increases/decreases in interest in subsidiaries, after the Company has obtained control, are treated as acquisitions/reductions of shares from non-controlling shareholders. The identifiable assets and liabilities of the acquired entity are not subject to a further revaluation and the positive or negative difference between the cost of such subsequent acquisitions/reductions and the net amount disbursed/received from the Company's proportional portion is recorded in equity. d) Loss of control of a subsidiary When control of a subsidiary is lost as a result of a transaction, event or other circumstance, the Company derecognizes all assets, liabilities and non-controlling interests at their carrying amount. Any retained interest in the former subsidiary is recognized at its fair value at the date that control is lost. This fair value is reflected in the calculation of the gain or loss on disposal attributable to the parent, and becomes the initial carrying amount for subsequent accounting for the retained interest.
Segment Information	2.19 — Segment Information The bodies responsible for making operational decisions, allocating resources and evaluating performance include the Board of Executive Officers and the Board of Directors. The information presented to the senior management with the respective performance of each segment is derived from the records kept in accordance with accounting practices, with some reallocations between the segments. The Company’s segments are as follows: Brazil Operations (includes operations of steel and iron ore in Brazil, except Special Steel), North America Operations (includes all operations in North America, including the joint venture in Mexico, with the exception of Special Steel), South America Operations (includes all operations in South America, except Brazil and includes the Joint venture in Dominican Republic and Colombia) and Special Steel Operations (including special steel operations in Brazil and in the United States and the joint venture in Brazil).
Earnings per Share	2.20 — Earnings per Share The tables presented in note 25 reconcile net income to the amounts used to calculate basic and diluted earnings per share. The Company has no instruments considered antidilutive that should be excluded from the calculation of diluted EPS. The calculation of basic EPS has been based on the profit attributable to shareholders and weighted-average number of shares outstanding. The calculation of diluted EPS has been based on the profit attributable to shareholders and weighted-average number of shares outstanding after adjustment for the effects of all dilutive potential shares.
Long-term incentive plans	2.21 — Long-term incentive plans The Company settles its Long-term incentive plans by delivering its own shares, which are held in treasury until the exercise of the options by the employees. Additionally, the Company granted the following long-term incentive plans: Restricted Shares and Performance Shares, as presented in note 27.
Right-of-use assets and Lease liabilities	2.22 — Right-of-use assets and Lease liabilities Up to 2018, finance leases were recognized as assets and liabilities when the lease was deemed to transfer substantially all of the risks and rewards incidental to ownership of the lease asset from the lessor to the leassee. Operating leases were recognized as operating expenses in the statement of income as the expense was incurred. As from 2019, the Company, as a lessee, recognizes a right-of-use asset that represents its right to use the leased asset and a lease liability that represents its obligation to make lease payments. Exemptions are available for short-term leases and low-value items. The Company recognizes new assets and liabilities for its operating leases and the nature of the expenses related to these leases changes because the Company started to recognize a depreciation of assets under the right of use and financial expense on lease liabilities. Variable elements of payments related to leases (such as, for example, a lease for machinery and/or equipment with parts of payments based on the productivity of the asset) are not considered in the calculation of the liability, being recorded as operating expense. The discount rates used by the Company represent the incremental borrowing rates and were obtained from available market data, adjusted to the company and contracts characteristics. The IFRS 16 - Lease adopted as from 2019 provides practical expedients whose election is optional. The Company adopted the following practical expedients: 1) The Company did not reassess whether the contract is or contains lease at the initial application date, instead applied IAS 17 to contracts that were previously identified as a lease using IAS 17 and IFRIC 4; 2) The Company did not separate non-lease components from leasing components by considering them as a single lease component; 3) The Company did not record contracts with a term exceeding 12 months, which on the date of transition, they end within 12 months of the date of initial application. The payment related to those contracts are still expensed as incurred and presented as operating activities in the statement of cash flows; 4) The Company did not record contracts of low value. The payment related to those contracts are still expensed as incurred and presented as operating activities in the statement of cash flows; 5) The Company excluded initial direct costs of measuring the right to use asset on the date of initial application; 6) The Company made use of judgement in determining the term of the lease, if the contract contains options to extend or terminate the lease, among others; and 7) The Company applied a single discount rate to the lease portfolio with fairly similar characteristics (such as similar remaining lease term, similar classes of underlying assets in a similar economic environment).
New IFRS and Interpretations of the IFRIC (International Financial Reporting Interpretations Committee)	2.23 — New IFRS and Interpretations of the IFRIC (International Financial Reporting Interpretations Committee) - Amendment to IFRS 16 - Leasing concessions related to COVID-19. It clarifies aspects of the treatment of practical expedients and disclosure of concessions in leasing contracts as a result of COVID-19. This amendment is effective for fiscal years beginning on/or after June 1, 2020 and as it may be adopted in advance, the Company has already adopted this amendment for its fiscal year of 2020. The Company did not have significant impact on its Financial Statements. - Amendment of IFRS 3 - Definition of business. Clarifies aspects for the definition of business, in order to clarify when a transaction must have accounting treatment of business combination or acquisition of assets. This change in the standard is effective for years beginning on or after January 1, 2020. The Company did not have significant impact on its Financial Statements. - Amendment of IAS 1 and IAS 8 - Definition of materiality. Clarifies definition of materiality to the framework of the accounting standard where this concept is applicable. These changes are effective for years beginning on or after January 1, 2020. The Company did not have significant impact on its Financial Statements. - Amendment of IFRS 9, IAS 39 and IFRS 7 - Interest Rate Benchmark Reform. Clarifies interest rate aspects of hedge financial instruments . These changes are effective for years beginning on or after January 1, 2020. The Company did not have significant impact on its Financial Statements. In addition, the IASB issued/reviewed some IFRS standards, which have mandatory adoption for the year 2021 and/or after, and the Company is assessing the adoption impact of these standards in its Consolidated Financial Statements. - Amendment to IAS 1 - Classification of liabilities as Current or Non-current. It clarifies aspects to be considered for the classification of liabilities as Current Liabilities or Non-current Liabilities. This amendment to the standard is effective for fiscal years beginning on/or after January 1, 2023. The Company does not expect material impacts on its Financial Statements. - Annual improvements in IFRS 2018-2020 standards. It changes the IFRS 1, addressing aspects of first-time adoption in a subsidiary; IFRS 9, addressing the 10% test criterion for reversing financial liabilities; IFRS 16, covering illustrative examples of leasing and IAS 41, covering aspects of measurement at fair value. These changes are effective for fiscal years beginning on/or after January 1, 2022. The Company does not expect material impacts on its Financial Statements. - Amendment to IAS 16 - Property, plant and equipment: Result generated before reaching the expected conditions of use. It clarifies aspects to be considered for the classification of items produced before the asset is in the projected conditions of use. This amendment to the standard is effective for fiscal years beginning on/or after January 1, 2022. The Company does not expect material impacts on its Financial Statements. - Amendment to IAS 37 - Onerous contract: Cost of fulfilling a contract. It clarifies aspects to be considered for the classification of costs related to the fulfillment of an onerous contract. This amendment to the standard is effective for fiscal years beginning on/or after January 1, 2022. The Company does not expect material impacts on its Financial Statements. - Amendment to IFRS 3 - References to conceptual framework. It clarifies conceptual alignments of this standard with the IFRS conceptual framework. This amendment to the standard is effective for fiscal years beginning on/or after January 1, 2022. The Company does not expect material impacts on its Financial Statements. - Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16 - Reference Interest Rate Reform - Phase 2. It clarifies aspects related to the definition of reference interest rates for application in these standards. This amendment to the standard is effective for fiscal years beginning on or after January 1, 2021. The Company does not expect material impacts on its Financial Statements.
Risk of disease outbreaks and health pandemic: Covid-19	2.24 - Risk of disease outbreaks and health pandemic: COVID-19 The COVID-19 pandemic continues to impact global economic activity and represents the risk that the Company, employees, service providers, suppliers, customers and other business partners may be prevented from carrying out certain business activities for an indefinite period, including due to stoppages that can be requested or mandated by government authorities or elected by companies as a preventive measure. The COVID-19 pandemic may have an adverse effect on business and, given the uncertainty as to the extent and timing of a possible spread or its future mitigation and the imposition or relaxation of protective measures, it is not possible to reasonably estimate the impact on future results of operations, cash flows or the future financial condition of the Company. The demand for steel products is directly linked to the general economic activity in the international markets where the Company sells these products. A decline in the level of activity in the domestic or international markets in which the Company operates, as a consequence of the COVID-19 pandemic and measures to contain it, may adversely affect the demand and the price of these products and have a relevant effect. 2.24.1 Main impacts on the Segments The COVID-19 pandemic impacted the Company production and delivery of steel, resulting in interruption of production in some steel mills as of the second half of March. It is important to highlight that the Company prioritized service to customers at the different levels of demand observed, even with the production stoppages carried out. In the Brazil Segment, the electric steel mills resumed production throughout April and the Blast Furnace 2 in Ouro Branco - MG resumed production in July. In the North America Segment, the plants continue to operate normally, with production levels gradually adjusted according to the reduction in demand observed in the industry. Civil construction continues with healthy demand levels. In the Special Steels Segment, in Brazil and in the USA, there were scheduled shutdowns at its different electrical mills and rolling mills, considering the level of existing inventories and the demand requested by each customer. It is important to mention that the automotive sectors of the two countries decreed collective vacations during a certain period and have gradually resuming their operations. In the South America Segment, operations continue to operate with production levels gradually adjusted to the demand observed in the industry. 2.24.2 Main measures taken by the Company We are following all COVID-19 prevention guidelines issued by the competent health agencies in the countries in which we operate. For this reason, we have adopted a series of measures to mitigate the risk of transmission in the workplace, such as using home office, creating crisis committees, canceling national and international trips and participation in external events. The Company also reinforces that the health and safety of people are non-negotiable values. The Company daily monitors the evolution of the pandemic scenario and the impacts that this situation brings to the routines of employees, their families and, also, to the business. The nature of our business is complex and, in order to continue operating, much of our work cannot be done remotely. Therefore, our focus is to reduce the risk of the virus spreading through our operations, as operational continuity is essential for jobs, for neighboring communities and for the economies of the countries and regions where we operate. Our mills and offices, therefore, have contingency plans to deal with the ongoing impact of the pandemic, which will continue to be reviewed as the situation evolves. 2.24.3 Main associated risks a) Risk of impairment losses - Goodwill and Other Long-lived Assets The recoverability of goodwill and other long-lived assets is assessed based on the analysis and identification of facts or circumstances that may cause the need to perform the recoverability test. The Company carried out impairment tests on goodwill and other long-lived assets, which results are presented in note 30. b) Liquidity risk and the Company's ability to meet its financial obligations The long-term portion of loans and financing (note 15) and debentures (note 16) has its most relevant maturities as from 2026, which allows the Company to generate cash flows through the years to meet its financial obligations. In addition, the Company's management constantly monitors liquidity risk through the management of its cash and cash equivalents and financial investments (note 4) and the availability of credit lines and guaranteed accounts that allow it to manage its level of indebtedness. (note 15). c) Risk of losses due to the non-recoverability of financial assets The losses due to the non-recoverability of financial assets were calculated based on the credit risk analysis, which includes historical losses, the individual situation of the clients, the situation of the economic group to which they belong, the real guarantees for debts and the assessment of legal advisors, and is considered sufficient to cover possible losses on the amounts receivable, in addition to a prospective assessment that takes into account the change or expected change in economic factors that affect expected credit losses, which are determined based on in weighted and measured probabilities in an amount equal to the expected credit loss for life. The maximum exposure to the Company's credit risk, net of losses due to the non-recoverability of financial assets, is the value of accounts receivable. The credit quality of accounts receivable falling due is considered adequate, and the amount of the effective risk of possible losses in accounts receivable from customers is presented as losses due to the non-recoverability of financial assets. The Company will continue, throughout 2021, its constant monitoring of the market in order to identify any deterioration, especially as a result of the COVID-19 pandemic, a significant drop in demand from the steel consuming sectors (notably automotive and construction), relevant changes in the economy or financial market that lead to an increase in the perception of credit risk on accounts receivable from customers. Eventual changes that deteriorate the economic and business environment, if manifested at a greater intensity than anticipated in the scenarios contemplated by Management, may result in losses due to the non-recoverability of financial assets, notably accounts receivable from customers. d) Risk of losses based on the net realizable value in inventories Inventories are valued based on the lowest value between the historical cost of acquisition and production and the net realizable value. The acquisition and production cost is increased by expenses related to transport, storage and non-recoverable taxes. The net realizable value is the estimated sale price in the normal course of business, less estimated costs for completion and directly related selling expenses. Information regarding the opening of the net realizable value is shown in note 6. The Company used the estimated sale price in the normal course of business as a premise of the net realizable value, therefore, a decline in the level of activity in the domestic or international markets in which the Company operates, as a consequence of the COVID-19 pandemic and measures to contain it, may affect the demand and the price of these products and have an adverse effect on the realizable value of inventories. e) Risk on recoverability analysis of deferred tax assets In December 2020, the Company prepared analysis on the recoverability of deferred tax balances related to tax losses and negative social contribution base, which were approved by the Board of Directors and are based on its business plans and in line with the other projections used by the Company as, for example, in asset impairment tests. Eventual changes that deteriorate the economic and business environment, especially as a result of the COVID-19 pandemic, if manifested in a greater intensity than anticipated in the scenarios contemplated by the Management, may lead the Company to review its projections and, eventually, may affect the maintenance of deferred tax assets in the Company's Financial Statements. f) Continuity risk The risks arising from disease outbreaks and health epidemics, notably those arising from the COVID-19 pandemic, can contribute significantly to the deterioration of economic conditions in Brazil and globally and could, among other consequences, (i) negatively impact further global demand for steel or even lower market prices for products, which may result in a continued reduction in the Company's sales, operating income and cash flows; (ii) making it more difficult or costly to obtain financing for operations or refinance debt in the future; (iii) impair the financial condition of some of the customers and suppliers; and (iv) reduce investment programs. The Company constantly monitors the risks of commodity prices, interest rates and exchange rates, credit risk management and capital management (note 17.c). The Company believes that it has no evidence of any risk of operational continuity, however, changes that deteriorate the economic and business environment, or significant changes in the economy or financial market that result in increased risk perception or reduced liquidity and capacity to refinancing, if manifested at a greater intensity than anticipated in the scenarios contemplated by Management, may lead the Company to revise its projections and, eventually, may affect the Company's ability to meet its obligations and / or lead to the recognition of impairment of assets.

CONSOLIDATED FINANCIAL STATEM_2

CONSOLIDATED FINANCIAL STATEMENTS (Tables)	12 Months Ended
	Dec. 31, 2020
CONSOLIDATED FINANCIAL STATEMENTS
Schedule of significant consolidated subsidiaries	Equity Interests Consolidated company Country Total capital (*) 2020 2019 2018 Gerdau GTL Spain S.L. Spain 100.00 100.00 100.00 Gerdau Internacional Empreendimentos Ltda. - Grupo Gerdau Brazil 100.00 100.00 100.00 Gerdau Ameristeel Corporation and subsidiaries (1) USA/Canada 100.00 100.00 100.00 Gerdau Açominas S.A. and subsidiary Brazil 99.86 99.83 99.83 Gerdau Aços Longos S.A. and subsidiaries (2) Brazil 99.82 99.82 99.78 Gerdau Steel Inc. Canada 100.00 100.00 100.00 Gerdau Holdings Inc. and subsidiary (3) USA 100.00 100.00 100.00 Paraopeba - Fixed-income investment fund (4) (**) Brazil 89.26 96.96 91.40 Gerdau Hungria Holdings Limited Liability Company Hungary 100.00 100.00 100.00 GTL Equity Investments Corp. British Virgin Islands 100.00 100.00 100.00 Empresa Siderúrgica del Perú S.A.A. - Siderperú Peru 90.03 90.03 90.03 Gerdau GTL México, S.A. de C.V. and subsidiaries (5) Mexico 100.00 100.00 100.00 Seiva S.A. - Florestas e Indústrias Brazil 97.73 97.73 97.73 Gerdau Laisa S.A. Uruguai 100.00 100.00 100.00 Sipar Gerdau Inversiones S.A. Argentina 99.99 99.99 99.99 Sipar Aceros S.A. and subsidiary (6) Argentina 99.98 99.98 99.98 Sizuca - Siderúrgica Zuliana, C. A. Venezuela 100.00 100.00 100.00 GTL Trade Finance Inc. British Virgin Islands 100.00 100.00 100.00 Gerdau Trade Inc. British Virgin Islands 100.00 100.00 100.00 (*) (**) (1) Subsidiaries: Gerdau Ameristeel US Inc., Chaparral Steel Company. (2) Subsidiary: Gerdau Açominas Overseas Ltd., G2L Logistica Ltda. and Siderúrgica Latino-Americana S.A.. (3) Subsidiary: Gerdau MacSteel Inc. (4) Fixed-income investment fund managed by Bank JP Morgan S.A. (5) Subsidiary: Sidertul S.A. de C.V. and GTL Servicios Administrativos México, S.A. de C.V.. (6) Subsidiary: Siderco S.A.
Schedule of interests in joint ventures	Equity Interests Total capital (*) Joint ventures Country 2020 2019 2018 Bradley Steel Processors Canada 50.00 50.00 50.00 MRM Guide Rail Canada 50.00 50.00 50.00 Gerdau Corsa S.A.P.I. de CV Mexico 70.00 70.00 50.00 Gerdau Metaldom Corp. Dominican Rep. 50.00 50.00 50.00 Gerdau Summit Aços Fundidos e Forjados S.A. Brazil 58.73 58.73 58.73 Diaco S.A. Colombia 49.87 49.87 49.87 Juntos Somos Mais Fidelização S.A. Brazil 27.50 27.50 27.50 (*) The voting capital is substantially equal to the total capital. The interests reported represent the ownership percentage held directly and indirectly held in the joint venture.
Schedule of summarized financial information of the joint ventures	The summarized financial information of these joint ventures, accounted for under the equity method, is shown on a combined basis as follows: Joint ventures 2020 2019 2018 Net income (loss) 249,158 (16,403) Total comprehensive income (loss) 249,158 (16,403)
Schedule of interests in associate companies	Equity interests Total capital (*) Associate companies Country 2020 2019 2018 Dona Francisca Energética S.A. Brazil 51.82 51.82 51.82 Corsa Controladora, S.A. de C.V. Mexico - - 49.00 (*) The voting capital is substantially equal to the total capital. The interests reported represent the ownership percentage held directly and indirectly.
Schedule of summarized financial information of the associate companies	The summarized financial information of the associate companies, accounted for under the equity method, is shown on a combined basis as follows: Associate Companies 2020 2019 2018 Net income 42,008 31,249 31,806 Total comprehensive income 42,008 31,249 31,806
Schedule of fair value assessment of assets and liabilities and total purchase price paid for business combination	The Company concluded the fair value assessment of the assets and liabilities of Silat and the following table summarizes the fair value of such assets and liabilities at the date of business combination: Fair value of the Cash and cash equivalents 33,419 Trade accounts receivable - net 13,190 Inventories 24,160 Other current assets 11,091 Property, plant and equipment 486,757 Other non-current assets 34,410 Current liabilities (26,638) Deferred income taxes (86,093) Other non-current liabilities (359) Non-controlling interest (11,495) Assets (Liabilities) 478,442 Bargain purchase (2,481) Net assets 475,961 3.5 - Total purchase price considered for the 2020 acquisition Subsidiary acquired 2020 Siderúrgica Latino-Americana S.A. 475,961 Total consideration paid 475,961 Less: Cash and cash equivalents of acquired subsidiary (33,419) 442,542

CASH AND CASH EQUIVALENTS, AN_2

CASH AND CASH EQUIVALENTS, AND SHORT AND LONG-TERM INVESTMENTS (Tables)	12 Months Ended
	Dec. 31, 2020
CASH AND CASH EQUIVALENTS, AND SHORT AND LONG-TERM INVESTMENTS
Schedule of cash and cash equivalents and investments	2020 2019 Cash 9,060 12,302 Banks and immediately available investments 4,608,144 2,629,350 Cash and cash equivalents 4,617,204 2,641,652 Immediately available investments include investments with maturity up to 90 days, immediate liquidity and low risk of fair value variation. 2020 2019 Short-term investments 3,041,143 3,652,949

TRADE ACCOUNTS RECEIVABLE (Tabl

TRADE ACCOUNTS RECEIVABLE (Tables)	12 Months Ended
	Dec. 31, 2020
TRADE ACCOUNTS RECEIVABLE
Schedule of trade accounts receivable	2020 2019 Trade accounts receivable - in Brazil 2,081,740 1,193,971 Trade accounts receivable - exports from Brazil 26,121 117,274 Trade accounts receivable - outside of Brazil 1,766,555 1,459,204 (-) Impairment loss on trade receivables (137,146) 3,737,270 2,672,370
Schedule of accounts receivable by aging	2020 2019 Current 3,466,000 2,226,121 Past-due: Up to 30 days 259,756 381,999 From 31 to 60 days 48,905 58,972 From 61 to 90 days 9,355 30,202 From 91 to 180 days 13,636 15,384 From 181 to 360 days 15,899 16,739 Above 360 days 60,865 41,032 (-) Impairment on financial assets (137,146) 3,737,270 2,672,370
Schedule of the changes in impairment on financial assets	Balance as of January 1, 2018 (179,702) Impairment on financial assets during the year (111,900) Recoveries in the year 101,986 Write-offs 39,943 Exchange variation (5,136) Assets held for sale (3,348) Balance as of December 31, 2018 (158,157) Impairment on financial assets during the year Recoveries in the year 60,199 Write-offs 78,635 Exchange variation 2,487 Balance as of December 31, 2019 Impairment on financial assets during the year Recoveries in the year 84,416 Write-offs 36,210 Exchange variation Balance as of December 31, 2020

INVENTORIES (Tables)

INVENTORIES (Tables)	12 Months Ended
	Dec. 31, 2020
INVENTORIES
Schedule of inventories	2020 2019 Finished products 3,894,698 3,302,569 Work in progress 2,045,158 1,426,607 Raw materials 1,934,958 1,611,334 Storeroom supplies 786,401 974,412 Imports in transit 514,321 384,123 (-) Allowance for adjustments to net realizable value 9,169,417 7,659,737
Schedule of the changes in the allowance for adjustment to net realizable value of inventories	Balance as of January 1, 2018 (3,556) Provision for the year (11,943) Reversal of adjustments to net realizable value 3,715 Exchange rate variation (871) Assets held for sale (1,049) Balance as of December 31, 2018 (13,704) Provision for the year Reversal of adjustments to net realizable value 22,028 Exchange rate variation Balance as of December 31, 2019 Provision for the year Reversal of adjustments to net realizable value 47,259 Exchange rate variation Balance as of December 31, 2020

TAX CREDITS (Tables)

TAX CREDITS (Tables)	12 Months Ended
	Dec. 31, 2020
TAX CREDITS
Schedule of current and non-current tax credits	2020 2019 Current ICMS (state VAT) 297,926 279,483 Social security financing 632,927 104,704 Financing of social integration program 171,724 26,198 IPI (federal VAT) 38,174 26,173 IVA (value-added tax) 24,500 41,958 Others 36,061 25,786 1,201,312 504,302 Non-current ICMS (state VAT) 64,163 51,615 Social security financing 441,111 331,435 Financing of social integration program and Others 158,771 82,499 664,045 465,549 1,865,357 969,851
Schedule of estimates of realization of non-current tax credits	2020 2019 2021 - 190,773 2022 584,145 106,271 2023 22,433 83,371 2024 8,054 65,000 2025 on 49,413 20,134 664,045 465,549

INCOME AND SOCIAL CONTRIBUTIO_2

INCOME AND SOCIAL CONTRIBUTION TAXES (Tables)	12 Months Ended
	Dec. 31, 2020
INCOME AND SOCIAL CONTRIBUTION TAXES
Schedule of reconciliations of income and social contribution taxes at statutory rates to amounts presented in the Statement Of Income	2020 2019 2018 Income (loss) before income taxes 3,495,678 1,674,720 2,157,431 Statutory tax rates 34 % 34 % 34 % Income and social contribution taxes at statutory rates (1,188,531) (733,527) Tax adjustment with respect to: - Difference in tax rates in foreign companies 530,715 75,428 663,116 - Equity in earnings of unconsolidated companies 51,873 3,448 - Interest on equity* 98,739 69 128,418 - Tax credits and incentives 31,800 8,852 9,531 - Deferred tax assets not recognized (592,861) - - - Recognition of previously unrecognized tax losses 4,944 1,097 47,545 - Other permanent differences, net (44,303) 31,923 50,420 Income and social contribution taxes (1,107,624) 168,951 Current (908,051) (629,209) Deferred (199,573) 798,160 (*) Brazilian Law 9,249/95 provides that a company may, at its sole discretion, consider dividends distributions to shareholders to be considered as interest on own capital — subject to specific limitations - which has the effect of a taxable deduction in the determination of income tax and social contribution. The limitation is the greater of (i) shareholders’ equity multiplied by the TJLP (Long Term Interest Rate) rate or (ii) 50% of the net income in the fiscal year. This expense is not recognized for the purpose of preparing the financial statements and therefore does not impact net income.
Schedule of breakdown and changes in deferred income and social contribution tax assets and liabilities at statutory tax rates	Balance as of Recognized in Acquisition of Comprehensive Balance as of December 31, 2019 income subsidiary Income December 31, 2020 Tax loss carryforward 1,341,464 - 36,228 1,220,485 Social contribution tax losses 350,810 - - 290,276 Provision for tax, civil and labor liabilities 242,794 140,871 - 1,798 385,463 Benefits granted to employees 294,031 - 105,074 392,257 Other temporary differences 575,719 - 40,022 501,114 Deferred exchange variance* 1,177,428 - (709) 1,057,541 Provision for losses 23,618 11,740 - 162 35,520 Fair value adjustments on businesses acquired (452,058) 106,210 3,553,806 63,652 3,331,792 Non-current assets 4,071,219 3,393,354 Non-current liabilities (517,413) * Corresponds to deferred taxes over foreign exchange gains and loss which certain subsidiaries elected to tax on a cash basis Balance as of Recognized in Comprehensive Balance as of December 31, 2018 income Others Income December 31, 2019 Tax loss carryforward 1,339,933 4,781 (36,226) 32,976 1,341,464 Social contribution tax losses 337,258 13,552 - - 350,810 Provision for tax, civil and labor liabilities 270,417 (27,848) - 225 242,794 Benefits granted to employees 286,494 (29,739) - 37,276 294,031 Other temporary differences 525,818 73,067 - (23,166) 575,719 Deferred exchange variance* 1,284,377 (106,640) - (309) 1,177,428 Provision for losses 83,837 (75,142) - 14,923 23,618 Fair value adjustments on businesses acquired (372,448) (69,464) - (10,146) (452,058) 3,755,686 (217,433) (36,226) 51,779 3,553,806 Non-current assets 3,874,054 4,071,219 Non-current liabilities (118,368) (517,413) * Balance as of Recognized in Comprehensive Balance as of January 1, 2018 income Others Income December 31, 2018 Tax loss carryforward 973,638 341,664 36,445 (11,814) 1,339,933 Social contribution tax losses 355,782 (18,524) - - 337,258 Provision for tax, civil and labor liabilities 275,463 (5,214) 168 - 270,417 Benefits granted to employees 282,803 (16,564) 67,184 (46,929) 286,494 Other temporary differences 410,300 93,094 17,177 5,247 525,818 Deferred exchange variance* 1,060,527 223,850 - - 1,284,377 Provision for losses 110,728 (33,165) (12) 6,286 83,837 Fair value adjustments on businesses acquired (497,534) 213,019 (89,859) 1,926 (372,448) 2,971,707 798,160 31,103 (45,284) 3,755,686 Non-current assets 3,054,393 3,874,054 Non-current liabilities (82,686) (118,368) *
Schedule of estimated recovery and reversal of income and social contributions tax assets and liabilities	Assets 2020 2019 2020 - 605,657 2021 616,409 467,153 2022 399,248 422,863 2023 391,610 464,514 2024 348,139 472,734 2025 and after 1,637,948 1,638,298 3,393,354 4,071,219 Liabilities 2020 2019 2021 (8,558) (98,449) 2022 (8,192) (110,031) 2023 (14,815) (90,703) 2024 (3,145) (79,022) 2025 and after (26,852) (139,208) (61,562) (517,413)

INVESTMENTS IN ASSOCIATES AND_2

INVESTMENTS IN ASSOCIATES AND JOINT VENTURES (Tables)	12 Months Ended
	Dec. 31, 2020
INVESTMENTS IN ASSOCIATES AND JOINT VENTURES
Summary of investments in associates and joint ventures	Investments in Investments in Investments in Investments in North America South America Special Steel Brazil Others Total Balance as of January 1, 2018 346,080 584,899 199,647 - 149,673 1,280,299 Equity in earnings (77,909) 51,648 15,629 (1,700) 22,473 10,141 Other comprehensive income 33,101 96,045 (1,377) (2,050) - 125,719 Capital increase - - - 7,000 - 7,000 Dividends/Interest on equity - (31,359) - - (23,998) (55,357) Balance as of December 31, 2018 301,272 701,233 213,899 3,250 148,148 1,367,802 Equity in earnings (111,637) 66,468 6,779 (828) 22,168 (17,050) Other comprehensive income 28,182 21,282 3,523 2,051 - 55,038 Capital increase 463,990 - - 7,000 - 470,990 Capital reduction - (20,344) (20,344) Dividends/Interest on equity - (20,247) - - (23,790) (44,037) Balance as of December 31, 2019 681,807 748,392 224,201 11,473 146,526 1,812,399 Equity in earnings 23,494 99,913 8,900 21,550 152,569 Other comprehensive income 165,479 195,286 - - 358,816 Capital increase 42,782 - - - - 42,782 Dividends/Interest on equity (5,223) - - Balance as of December 31, 2020 908,339 976,045 231,152 10,185 145,908 2,271,629

PROPERTY, PLANT AND EQUIPMENT (

PROPERTY, PLANT AND EQUIPMENT (Tables)	12 Months Ended
	Dec. 31, 2020
PROPERTY, PLANT AND EQUIPMENT
Summary of changes in property, plant and equipment	Property, plant and Land and Machines, equipment, Data electronic equipment under Cost of the property, plant, and equipment buildings and installations equipment construction Other Total Balances as of January 1, 2018 9,085,698 28,016,604 711,638 950,680 1,175,697 39,940,317 Additions 13,739 66,764 11,811 983,519 119,101 1,194,934 Capitalized interest - - - 23,999 - 23,999 Transfers 140,334 802,664 457 (949,888) 6,433 - Disposals (45,290) (285,860) (5,641) (3,352) (9,606) (349,749) Transfer to assets held for sale (784,464) (749,425) (14,914) (49,579) (300,618) (1,899,000) Effects of IAS 29 adoption - 699,724 - - - 699,724 Foreign exchange effect 290,732 1,058,527 49,727 65,868 (2,893) 1,461,961 Balances as of December 31, 2018 8,700,749 29,608,998 753,078 1,021,247 988,114 41,072,186 Additions 28,449 76,756 13,955 1,506,343 121,097 1,746,600 Capitalized interest - - - 24,676 - 24,676 Transfers 115,452 884,161 24,037 (1,038,693) 15,043 - Disposals (54,699) (165,139) (1,890) (40,314) (105,643) (367,685) Foreign exchange effect 122,992 626,432 13,369 42,470 10,797 816,060 Balances as of December 31, 2019 8,912,943 31,031,208 802,549 1,515,729 1,029,408 43,291,837 Additions 50,848 98,372 9,765 1,369,947 121,846 1,650,778 Capitalized interest - - - 24,622 - 24,622 Transfers 207,551 695,512 13,653 (939,231) 22,515 - Disposals (226,920) (505,580) (11,487) - (144,153) (888,140) Business Combination (note 3.4) 275,076 173,453 29 36,563 1,636 486,757 Impairment of non-financial assets (note 30) (198,196) (213,729) - - - (411,925) Foreign exchange effect 918,554 3,621,233 107,634 246,575 47,285 4,941,281 Balances as of December 31, 2020 9,939,856 34,900,469 922,143 2,254,205 1,078,537 49,095,210 Property, plant and Land and Machines, equipment, Data electronic equipment under Accumulated depreciation buildings and installations equipment construction Other Total Balances as of January 1, 2018 (3,915,023) (18,576,836) (622,234) - (382,482) (23,496,575) Depreciation (291,315) (1,128,138) (34,814) - (130,611) (1,584,878) Transfers 18,341 5,234 158 - (23,733) - Disposals 29,944 258,609 2,609 - 7,970 299,132 Transfer to assets held for sale 105,787 286,204 11,667 - 234,271 637,929 Effects of IAS 29 adoption - (265,654) - - - (265,654) Foreign exchange effect (129,539) (946,240) (44,332) - 4,452 (1,115,659) Balances as of December 31, 2018 (4,181,805) (20,366,821) (686,946) - (290,133) (25,525,705) Depreciation (295,615) (1,136,040) (33,143) - (112,384) (1,577,182) Transfers - (20) - - 20 - Disposals 38,826 145,019 1,818 - 105,272 290,935 Foreign exchange effect (74,868) (483,549) (12,151) - (7,824) (578,392) Balances as of December 31, 2019 (4,513,462) (21,841,411) (730,422) - (305,049) (27,390,344) Depreciation - Disposals 223,174 497,434 11,169 - 128,833 860,610 Foreign exchange effect - Balances as of December 31, 2020 - Net property, plant and equipment Balances as of December 31, 2018 4,518,944 9,242,177 66,132 1,021,247 697,981 15,546,481 Balances as of December 31, 2019 4,399,481 9,189,797 72,127 1,515,729 724,359 15,901,493 Balances as of December 31, 2020 4,795,317 9,366,248 64,468 2,254,205 772,677 17,252,915
Summary of useful lives of property, plant and equipment	Useful lives of property, plant and equipment Buildings 10 to 33 years Machines, equipment, and installations 10 to 20 years Furniture and fixture 5 to 10 years Vehicles 3 to 5 years Data electronic equipment 2.5 to 6 years

GOODWILL (Tables)

GOODWILL (Tables)	12 Months Ended
	Dec. 31, 2020
GOODWILL
Summary of changes in goodwill	Accumulated Goodwill after Goodwill impairment losses Impairment losses Balance as of January 1, 2018 14,500,381 (6,609,239) 7,891,142 (+/-) Foreign exchange effect 2,283,577 (1,062,329) 1,221,248 Balance as of December 31, 2018 16,783,958 (7,671,568) 9,112,390 (+/-) Foreign exchange effect 661,247 356,921 Balance as of December 31, 2019 17,445,205 9,469,311 (+/-) Foreign exchange effect 4,976,383 2,634,208 Balance as of December 31, 2020 22,421,588 12,103,519
Schedule of goodwill by segment	2020 2019 2018 Brazil 373,135 373,135 373,135 Special Steel 3,828,841 2,969,752 2,854,888 North America 7,901,543 6,126,424 5,884,367 12,103,519 9,469,311 9,112,390

INTANGIBLE ASSETS (Tables)

INTANGIBLE ASSETS (Tables)	12 Months Ended
	Dec. 31, 2020
INTANGIBLE ASSETS
Summary of intangible assets	Customer Supplier Software contracts and relationships development relationships Others Total Balance as of January 01, 2018 32,786 490,829 440,774 7,700 972,089 Foreign exchange effect - 28,598 77,593 1,243 107,434 Acquisition - 67,388 - - 67,388 Disposal - (3,791) (88) - (3,879) Amortization (6,067) (167,384) (130,980) (2,505) (306,936) Balance as of December 31, 2018 26,719 415,640 387,299 6,438 836,096 Foreign exchange effect - 6,137 12,586 472 19,195 Acquisition - 100,313 - - 100,313 Amortization (5,304) (157,278) (116,462) (3,298) (282,342) Balance as of December 31, 2019 21,415 364,812 283,423 3,612 673,262 Foreign exchange effect - 42,890 83,806 1,074 127,770 Acquisition - 154,250 - - 154,250 Amortization (4,637) (188,083) (136,525) (3,459) (332,704) Balance as of December 31, 2020 16,778 373,869 230,704 1,227 622,578 Estimated useful lives 5 to 20 years 7 years 5 to 20 years 5 years
Summary of intangible assets by segment	2020 2019 2018 Brazil 220,303 238,243 295,107 Special Steel 156,557 132,934 136,910 South America 1,534 1,729 1,441 North America 244,184 300,356 402,638 622,578 673,262 836,096

LEASING (Tables)

LEASING (Tables)	12 Months Ended
	Dec. 31, 2020
LEASING
Summary of changes in the Right-of-use assets	Machines, equipment, Data electronic Right-of-use Cost Land and buildings and installations equipment Others Total Balances as of January 1, 2019 243,250 436,401 106,787 49,930 836,368 Additions 14,062 117,653 742 11,064 143,521 Disposals (10,493) (22,993) (162) (1,907) (35,555) Remeasurements 33,322 (2,346) - 1,236 32,212 Foreign exchange effect 3,853 4,571 46 2,119 10,589 Balances as of December 31, 2019 283,994 533,286 107,413 62,442 987,135 Additions 5,670 185,116 175 43,862 234,823 Disposals - Remeasurements 111 12,548 69 9,693 Foreign exchange effect 26,748 37,809 340 15,747 80,644 Balances as of December 31, 2020 301,940 738,330 120,476 120,944 1,281,690 Machines, equipment, Data electronic Accumulated depreciation Land and buildings and installations equipment Others Total Balances as of January 1, 2019 - - - - - Depreciation (50,080) (127,399) (15,419) (21,873) (214,771) Disposals 1,330 4,250 32 976 6,588 Foreign exchange effect (733) (128) (9) (768) (1,638) Balances as of December 31, 2019 (49,483) (123,277) (15,396) (21,665) (209,821) Depreciation Disposals 8,601 13,453 - 1,027 23,081 Foreign exchange effect Balances as of December 31, 2020
Schedule of leasing payables	The payment schedules of leasing are as follows: 2020 2019 2020 - 202,536 2021 231,703 172,870 2022 193,314 121,379 2023 140,019 85,878 2024 90,812 58,866 2025 on 200,626 162,740 856,474 804,269 Leasing payable Current 231,703 202,536 Non-current 624,771 601,733 Financial expense for the year ended on December 31, 2020 and 2019 61,727 83,620

TRADE ACCOUNTS PAYABLE (Tables)

TRADE ACCOUNTS PAYABLE (Tables)	12 Months Ended
	Dec. 31, 2020
TRADE ACCOUNTS PAYABLE
Schedule of trade accounts payable	2020 2019 Trade accounts payable - domestic market 3,941,924 2,701,246 Trade accounts payable - debtor risk 726,045 376,093 Trade accounts payable - intercompany 8,958 4,283 Trade accounts payable - imports 761,026 681,146 5,437,953 3,762,768

SHORT-TERM DEBT AND LONG-TERM_2

SHORT-TERM DEBT AND LONG-TERM DEBT (Tables)	12 Months Ended
	Dec. 31, 2020
SHORT-TERM DEBT AND LONG-TERM DEBT
Schedule of loans and financing	Annual charges (*) 2020 2019 Working capital 1,178,557 107,312 Financing of property, plant and equipment and others 333,797 843,099 Ten/Thirty Year Bonds 13,100,580 12,188,412 Total Loans and Financing 14,612,934 13,138,823 Current 1,424,043 1,544,211 Non-current 13,188,891 11,594,612 Principal amount of loans and Financing 14,413,188 12,958,565 Interest accrued of loans and Financing 199,746 180,258 Total 14,612,934 13,138,823 (*)
Schedule of loans and financing by currency	2020 2019 Brazilian Real (BRL) 1,245,988 111,492 U.S. Dollar (USD) 13,366,946 12,960,521 Other currencies - 66,810 14,612,934 13,138,823
Schedule of amortization of long term loans and financing	2020 2019 2021 - 1,221,361 2022 5,210 105,137 2023 2,108,324 1,243,774 2024 1,813,225 1,531,163 2025 682,422 1,642,664 2026 on 8,579,710 5,850,513 13,188,891 11,594,612

DEBENTURES (Tables)

DEBENTURES (Tables)	12 Months Ended
	Dec. 31, 2020
DEBENTURES
Schedule of debentures	General Quantity as of December 31, 2020 Issuance Meeting Issued Held in treasury Maturity 2020 2019 14th August 26, 2014 20,000 20,000 August 30, 2024 - - 15th November 09, 2018 1,500,000 - November 21, 2022 1,500,985 1,504,436 16th - A April 25, 2019 600,000 - May 6, 2023 600,759 602,847 16th - B April 25, 2019 800,000 - May 6, 2026 800,673 803,761 Total Consolidated 2,902,417 2,911,044 Current 7,463 18,015 Non-current 2,894,954 2,893,029
Schedule of amortization of long term debentures	2020 2019 2022 1,497,760 1,496,591 2023 598,960 598,530 2027 on 798,234 797,908 2,894,954 2,893,029

FINANCIAL INSTRUMENTS (Tables)

FINANCIAL INSTRUMENTS (Tables)	12 Months Ended
	Dec. 31, 2020
FINANCIAL INSTRUMENTS
Summary of market value of financial instruments	2020 2019 Book Fair Book Fair value value value value Assets Short-term investments 3,041,143 3,041,143 3,652,949 3,652,949 Related parties 134,354 134,354 95,445 95,445 Fair value of derivatives - - 2,846 2,846 Other current assets 591,523 591,523 618,769 618,769 Other non-current assets 590,864 590,864 464,169 464,169 Liabilities Loans and Financing 14,612,934 17,014,948 13,138,823 14,288,142 Debentures 2,902,417 2,775,619 2,911,044 2,864,950 Related parties 22,855 22,855 - - Fair value of derivatives 971 971 - - Obligations with FIDC 987,406 987,406 1,018,501 1,018,501 Other current liabilities 797,082 797,082 666,858 666,858 Other non-current liabilities 514,886 514,886 449,375 449,375
Summary of capital management risk	Net debt/EBITDA From 1.0 to 1.5 times Gross debt limit R$ 12 billion Average maturity more than 6 years
Schedule of maturity of long-term loans and financing, and debentures	2020 Contractual obligations Total Less than 1 year 1-3 years 4-5 years More than 5 years Trade accounts payable 5,437,953 5,437,953 - - - Loans and financing 21,962,204 2,131,402 3,465,577 3,531,312 12,833,913 Debentures 3,077,960 66,145 2,174,184 32,604 805,027 Related parties 22,855 - - - 22,855 Obligations with FIDC 987,406 944,513 42,893 - - Other current liabilities 797,082 797,082 - - - Other non-current liabilities 514,886 - 41,805 - 473,081 32,800,346 9,377,095 5,724,459 3,563,916 14,134,876 2019 Contractual obligations Total Less than 1 year 1-3 years 4-5 years More than 5 years Trade accounts payable 3,762,768 3,762,768 - - - Loans and financing 20,061,659 2,312,877 2,659,844 3,793,164 11,295,774 Debentures 3,457,033 152,928 1,764,003 686,732 853,370 Obligations with FIDC 1,018,501 - - - 1,018,501 Other current liabilities 666,858 666,858 - - - Other non-current liabilities 449,375 - 20,079 - 429,296 29,416,194 6,895,431 4,443,926 4,479,896 13,596,941
Schedule of sensitivity analysis of financial instrument	Assumptions Percentage of change 2020 2019 Foreign currency sensitivity analysis 15,057 112,355 Interest rate sensitivity analysis 10 bps 85,147 70,891 Sensitivity analysis of changes in prices of products sold 438,147 396,440 Sensitivity analysis of changes in raw material and commodity prices 269,454 258,906 Sensitivity analysis of Swap of interest rate 50bps - 408 Sensitivity analysis of NDF (Non Deliverable Forwards) 3,703 -
Schedule of financial instruments per category	Financial asset at fair Financial asset at fair 2020 Financial asset at value through proft or value through other Assets amortized cost loss comprehensive income Total Short-term investments - 3,041,143 - 3,041,143 Related parties 134,354 - - 134,354 Other current assets 591,523 - - 591,523 Other non-current assets 530,864 60,000 - 590,864 Total 1,256,741 3,101,143 - 4,357,884 Financial income (expenses) 487,631 109,396 - 597,027 Financial liability at fair value through profit or Financial liability at Liabilities loss amortized cost Total Loans and financing - 14,612,934 14,612,934 Debentures - 2,902,417 2,902,417 Related parties - 22,855 22,855 Obligations with FIDC (current liabilities) - 944,513 944,513 Other current liabilities - 797,082 797,082 Obligations with FIDC (non-current liabilities) 42,893 42,893 Other non-current liabilities - 514,886 514,886 Fair value of derivatives 971 - 971 Total 971 19,837,580 19,838,551 Financial income (expenses) (1,632) (2,294,102) (2,295,734) Financial asset at fair Financial asset at fair 2019 Financial asset at value through proft or value through other Assets amortized cost loss comprehensive income Total Short-term investments - 3,652,949 - 3,652,949 Fair value of derivatives - - 2,846 2,846 Related parties 95,445 - - 95,445 Other current assets 618,769 - - 618,769 Other non-current assets 464,169 - - 464,169 Total 1,178,383 3,652,949 2,846 4,834,178 Financial income (expenses) 279,843 92,759 - 372,602 Financial liability at fair value through profit or Financial liability at Liabilities loss amortized cost Total Loans and financings - 13,138,823 13,138,823 Debentures - 2,911,044 2,911,044 Obligations with FIDC - 1,018,501 1,018,501 Other current liabilities - 666,858 666,858 Other non-current liabilities - 449,375 449,375 Total - 18,184,601 18,184,601 Financial income (expenses) (20,636)
Summary of derivative instruments	Notional value Amount receivable Amount payable Contracts Position 2020 2019 2020 2019 2020 2019 Swap of interest rate Maturity in 2020 CDI 111.50% - R$ 50.0 million - 2,846 - - Swap of interest rate Maturity in 2021 buyed in US$ US$ 9.9 milion - - - (971) - Total fair value of financial instruments - 2,846 (971) -
Summary of effectiveness testing of derivative financial instruments	Fair value of derivatives 2020 2019 Current assets - 2,846 - 2,846 Fair value of derivatives Current liabilities 971 - 971 - 2020 2019 Net Income Gains on financial instruments 858 5,518 Losses on financial instruments (1,632) (20,636) (774) (15,118) Other comprehensive income (Losses) Gains on financial instruments (1,972) 3,502 (1,972) 3,502
Schedule of financial assets and liabilities measures at fair value on recurring basis	Fair Value Measurements at Reporting Date Using Quoted Prices in Non-Active Markets for Similar Assets Balance per financial statements (Level 2) 2020 2019 2020 2019 Current assets Short-term investments 3,041,143 3,652,949 3,041,143 3,652,949 Fair value of derivatives - 2,846 - 2,846 Other current assets 591,523 618,769 591,523 618,769 Non-current assets Related parties 134,354 95,445 134,354 95,445 Other non-current assets 590,864 464,169 590,864 464,169 4,357,884 4,834,178 4,357,884 4,834,178 Current liabilities Short-term debt 1,424,043 1,544,211 1,424,043 1,544,211 Debentures 7,463 18,015 7,463 18,015 Fair value of derivatives 971 - 971 - Obligations with FIDC 944,513 - 944,513 - Other current liabilities 797,082 666,858 797,082 666,858 Non-current liabilities Long-term debt 13,188,891 11,594,612 13,188,891 11,594,612 Debentures 2,894,954 2,893,029 2,894,954 2,893,029 Related parties 22,855 - 22,855 - Obligations with FIDC 42,893 1,018,501 42,893 1,018,501 Other non-current liabilities 514,886 449,375 514,886 449,375 19,838,551 18,184,601 19,838,551 18,184,601
Summary of changes in liabilities of cash flow from financing activities	Cash transactions Non cash transactions Interest expense on loans and Interest on Balances as of Proceeds/(Repayment) Interest paid on loans with related Exchange variation Balances as of December 31, 2019 from financing activities loans and financing parties and others December 31, 2020 Related parties, net (95,445) (7,777) - (8,277) - (111,499) Leasing payable 804,269 (247,914) (61,727) 61,727 300,119 856,474 Debt, Debentures and Losses/Gains on financial instruments, net - Derivative instruments 16,047,021 (1,963,283) (1,079,981) 1,022,460 3,490,105 17,516,322 Cash transactions Non cash transactions Interest expense on loans and Interest on Balances as of Proceeds/(Repayment) Interest paid on loans with related Exchange variation Balances as of December 31, 2018 from financing activities loans and financing parties and others December 31, 2019 Related parties, net (26,589) (64,089) - (4,767) - (95,445) Leasing payable 836,368 (161,824) (83,620) 83,620 129,725 804,269 Debt, Debentures and Losses/Gains on financial instruments, net - Derivative instruments 14,878,542 700,490 (945,027) 938,120 474,896 16,047,021 Cash transactions Non cash transactions Exchange variation, Interest expense on operations with loans and Interest on subsidiaries and Balances as of Proceeds/(Repayment) Interest paid on loans with related associate company and Balances as of January 01, 2018 from financing activities loans and financing parties others December 31, 2018 Related parties, net (51,839) 25,755 - (545) 40 (26,589) Debt, Debentures and Losses/Gains on financial instruments, net - Derivative instruments 16,510,851 (3,439,644) (1,162,364) 1,177,686 1,792,013 14,878,542

TAXES PAYABLE (Tables)

TAXES PAYABLE (Tables)	12 Months Ended
	Dec. 31, 2020
TAXES PAYABLE
Schedule of taxes payable	2020 2019 Payroll charges 100,301 75,385 ICMS (state VAT) 99,430 47,244 COFINS (tax on revenue) 51,444 6,654 IPI (federal VAT) 38,153 13,252 IVA (value-added tax) and others 310,761 290,453 600,089 432,988

TAX, CIVIL AND LABOR CLAIMS A_2

TAX, CIVIL AND LABOR CLAIMS AND CONTINGENT ASSETS (Tables)	12 Months Ended
	Dec. 31, 2020
TAX, CIVIL AND LABOR CLAIMS AND CONTINGENT ASSETS
Schedule of provisions for tax, civil and labor claims	2020 2019 a) Tax provisions 706,104 396,821 b) Labor provisions 428,821 357,130 c) Civil provisions 37,586 55,348 1,172,511 809,299
Schedule of changes in the tax, labor and civil provisions	2020 2019 2018 Balance at the beginning of the year 809,299 770,305 827,883 (+) Additions 559,513 249,868 177,684 (+) Monetary correction 104,473 70,788 85,626 (-) Reversal of accrued amounts (304,678) (282,239) (319,719) (+) Foreign exchange effect on provisions in foreign currency 3,904 577 (1,169) Balance at the end of the year 1,172,511 809,299 770,305
Schedule of judicial deposits related to tax, labor and civil lawsuits	2020 2019 Tax 1,597,995 1,837,967 Labor 95,234 113,379 Civil 132,562 40,369 1,825,791 1,991,715

RELATED-PARTY TRANSACTIONS (Tab

RELATED-PARTY TRANSACTIONS (Tables)	12 Months Ended
	Dec. 31, 2020
RELATED-PARTY TRANSACTIONS
Schedule of intercompany loans	Maturity 2020 2019 Assets Joint venture Gerdau Corsa SAPI de C.V. January 1, 2021 117,092 73,607 Others Fundação Gerdau December 31, 2022 17,262 21,838 134,354 95,445 Liabilities Joint venture Bradley Steel Processors Inc. August 1, 2021 (22,855) - (22,855) - 2020 2019 2018 Net financial income 8,277 4,767 545
Summary of guarantees granted	Original Related Party Relationship Object Amount Maturity 2020 2019 2018 Gerdau Corsa S.A.P.I. de C.V. Joint-venture Financing Agreements 1,750,249 Oct/22 - Oct/24 2,242,865 1,784,868 1,933,929 Gerdau Summit Aços Fundidos e Forjados S.A. Joint-venture Financing Agreements 130,164 Aug/25 30,125 37,285 41,571 Gerdau Metaldom S.A. e Gerdau Corsa S.A.P.I. de C.V Joint-venture Financing Agreements 274,560 Feb/20 - 241,842 198,619
Schedule of key management compensation	2020 2019 Available at beginning of the year 6,717,872 6,375,547 Granted 733,218 1,083,116 Exercised (937,325) (627,076) Cancelled (64,112) (38,553) Others 6,595 (75,163) Available at the end of the year 6,456,248 6,717,872

EMPLOYEE BENEFITS (Tables)

EMPLOYEE BENEFITS (Tables)	12 Months Ended
	Dec. 31, 2020
EMPLOYEE BENEFITS
Schedule of total assets and liabilities of all types of employee benefits granted	2020 2019 Plan assets - Defined contribution pension plan 39,196 45,381 Total assets 39,196 45,381 Actuarial liabilities - Defined benefit pension plan 1,441,592 1,138,592 Acturial liabilities - Post-employment health care benefit 362,944 298,989 Retirement and termination benefit liabilities 56,903 32,863 Total liabilities 1,861,439 1,470,444 Current 208 495 Non-current 1,861,231 1,469,949
Post-employment defined benefit pension plans
EMPLOYEE BENEFITS
Summary of sensitivity analysis	1% Increase 1% Decrease Discount rate (17,965) 12,482
Defined benefit pension plan
EMPLOYEE BENEFITS
Schedule of current expenses of benefit plans	2020 2019 2018 Cost of current service 69,323 54,518 60,803 Interest expense 191,326 189,544 82,513 Return on plan assets (156,475) (163,148) (59,692) Past service cost 3,967 2,302 7,065 Settlement (11,609) (4,712) 3,220 Interest cost on unrecoverable surplus 7,413 16,247 20,023 Net pension cost 103,945 94,751 113,932
Schedule of reconciliations of assets and liabilities of benefit plans	2020 2019 Present value of defined benefit obligation (5,921,285) (4,601,965) Fair value of plan assets 4,652,000 3,656,891 Asset ceiling restrictions on recognition of net funded assets (172,307) (193,517) Net (1,441,592) (1,138,591) Defined benefit obligation (1,441,592) (1,138,591)
Schedule of variation of plan obligations and assets	2020 2019 2018 Variation of the plan obligations Obligation at the begining of the year 4,601,965 4,391,251 4,314,592 Cost of service 69,323 54,518 60,803 Interest expense 191,326 189,544 188,729 Payments of the benefits (434,650) (309,817) (318,198) Past service cost 3,967 2,302 7,065 Supplementary amounts of the plan - - 17,078 Settlement (190,948) (498,493) (61,369) Acturial remeasurements 467,106 546,911 (370,083) Exchange Variance 1,213,196 225,749 552,634 Obligation at the end of the year 5,921,285 4,601,965 4,391,251 2020 2019 2018 Variation of the plan assets Fair value of the plan assets at the begining of the year 3,656,891 3,568,934 3,456,613 Return of the plan assets 156,475 163,148 165,908 Contributions from sponsors 224,979 162,650 197,828 Settlement (179,339) (493,781) (64,868) Payments of benefits (434,650) (309,817) (318,198) Remeasurement 334,675 386,767 (253,301) Exchange Variance 892,969 178,990 384,952 Fair value of plan assets at the end of the year 4,652,000 3,656,891 3,568,934
Summary of actuarial gains and losses recognized in other comprehensive income	2020 2019 2018 Remeasurements (334,675) (386,767) 253,301 Actuarial Remeasurements 467,106 546,911 (370,083) Restriction recognized in Other Comprehensive Income (42,317) (94,198) (43,197) Remeasurements recognized in Other Comprehensive Income 90,114 65,946 (159,979)
Summary of historical actuarial remeasurements	2020 2019 2018 2017 2016 Present value of defined benefit obligation (5,921,285) (4,601,965) (4,391,251) (4,314,592) (4,174,653) Fair value of the plan assets 4,652,000 3,656,891 3,568,934 3,456,613 3,292,890 Surplus (Deficit) (1,269,285) (945,074) (822,317) (857,979) (881,763) Experience adjustments on plan liabilities (Gain) 467,106 546,911 (370,083) 235,549 186,905 Experience adjustments on plan assets (Gain) (334,675) (386,767) 253,301 (232,214) (109,153)
Summary of allocation for plan assets	2020 Brazilian Plans American Plans Fixed income Variable income - Others Total 2019 Brazilian Plans American Plans Fixed income Variable income - Others Total
Summary of assumptions	2020 Brazilian Plan North America Plan Average discount rate 2.25% - 2.50% Rate of increase in compensation Not applicable Mortality table AT-2000 per sex RP-2006 and MP-2020 Mortality table of disabled AT-2000 per sex RP-2006 and MP-2020 Rate of rotation Null Based on age and/or the service 2019 Brazilian Plan North America Plan Average discount rate 3.00% - 3.25% Rate of increase in compensation Not applicable Mortality table AT-2000 per sex RP-2006 and MP-2019 Mortality table of disabled AT-2000 per sex RP-2006 and MP-2019 Rate of rotation Null Based on age and/or the service
Post-employment health care benefit
EMPLOYEE BENEFITS
Schedule of current expenses of benefit plans	2020 2019 2018 Current service cost 4,964 3,302 4,144 Interest expense 11,311 10,656 11,082 Past service cost (660) (2,717) (40,740) Net cost pension benefit 15,615 11,241 (25,514)
Schedule of reconciliations of assets and liabilities of benefit plans	2020 2019 Present value of obligations (362,944) (298,989) Total net liabilities (362,944) (298,989)
Schedule of variation of plan obligations and assets	2020 2019 2018 Change in benefit obligation Benefit obligation at beginning of the year 298,989 272,959 316,364 Cost of service 4,964 3,302 4,144 Interest expense 11,311 10,656 11,082 Past service cost (660) (2,717) (40,740) Contributions from participants 2,349 2,088 1,496 Payment of benefits (20,870) (15,331) (18,655) Remeasurements (23,533) 11,202 (40,841) Exchange variations 90,394 16,830 40,109 Benefit obligation at the end of the year 362,944 298,989 272,959 2020 2019 2018 Change in plan assets Contributions from sponsors 19,150 13,243 17,159 Contributions from participants 2,349 2,088 1,496 Payments of benefits (21,499) (15,331) (18,655) Fair value of plan assets at end of the year - - -
Summary of actuarial gains and losses recognized in other comprehensive income	2020 2019 2018 Losses / Gains on actuarial obligation (23,533) 11,202 (40,841) Actuarial losses recognized in Equity (23,533) 11,202 (40,841)
Summary of historical actuarial remeasurements	2020 2019 2018 2017 2016 Present value of defined benefit obligation (362,944) (298,989) (272,959) (316,364) (305,447) Deficit (362,944) (298,989) (272,959) (316,364) (305,447) Experience adjustments on plan liabilities (23,533) 11,202 (40,841) (14,452) (3,673)
Summary of assumptions	2020 2019 Average discount rate 2.25% - 2.50% 3.00% - 3.25% Health treatment - rate assumed next year 6.10% - 6.50% 5.80% - 6.70% Health treatment - Assumed rate of decline in the cost to achieve in the years of 2028 to 2041 4.00% - 4.40% 4.00% - 4.40%
Summary of sensitivity analysis	1% Increase 1% Decrease Effect over total service costs and interest costs 2,739 (2,171) Effect over benefit plan obligations 43,331 (34,975)

ENVIRONMENTAL LIABILITIES (Tabl

ENVIRONMENTAL LIABILITIES (Tables)	12 Months Ended
	Dec. 31, 2020
ENVIRONMENTAL LIABILITIES
Schedule of provision for environmental liabilities	2020 2019 Provision for environmental liabilities 297,094 112,308 Current 125,992 60,913 Non-current 171,102 51,395

EQUITY (Tables)

EQUITY (Tables)	12 Months Ended
	Dec. 31, 2020
EQUITY
Schedule of reconciliations of common and preferred outstanding shares	2020 2019 2018 Common shares Preferred shares Common shares Preferred shares Common shares Preferred shares Balance at beginning of the year 571,929,945 1,127,010,827 571,929,945 1,124,233,755 571,929,945 1,137,327,184 Acquisition of Treasury shares - - - - - (16,000,000) Exercise of long-term incentive plan - 2,220,660 - 2,777,072 - 1,597,235 Transfer of shares - - - - - 1,309,336 Balance at the end of the year 571,929,945 1,129,231,487 571,929,945 1,127,010,827 571,929,945 1,124,233,755
Schedule of ownership of shares	Shareholders 2020 Shareholders Common % Pref. % Total % Metalúrgica Gerdau S.A. * 557,898,901 97.3 2,147,800 0.2 560,046,701 32.6 Brazilian institutional investors 3,397,955 0.6 227,262,531 19.8 230,660,486 13.4 Foreign institutional investors 3,142,148 0.5 492,076,396 42.9 495,218,544 28.8 Other shareholders 7,490,941 1.3 407,744,760 35.6 415,235,701 24.1 Treasury stock 1,697,538 0.3 16,799,758 1.5 18,497,296 1.1 573,627,483 100.0 1,146,031,245 100.0 1,719,658,728 100.0 Shareholders 2019 Shareholders Common % Pref. % Total % Metalúrgica Gerdau S.A. * 557,898,901 97.3 69,852,184 6.1 627,751,085 36.5 Brazilian institutional investors 3,068,614 0.5 241,698,143 21.1 244,766,757 14.2 Foreign institutional investors 3,875,655 0.7 427,735,548 37.3 431,611,203 25.1 Other shareholders 7,086,775 1.2 387,724,952 33.8 394,811,727 23.0 Treasury stock 1,697,538 0.3 19,020,418 1.7 20,717,956 1.2 573,627,483 100.0 1,146,031,245 100.0 1,719,658,728 100.0 Shareholders 2018 Shareholders Common % Pref. % Total % Metalúrgica Gerdau S.A. * 557,898,901 97.3 95,469,922 8.3 653,368,823 38.0 Brazilian institutional investors 2,383,207 0.4 224,073,547 19.6 226,456,754 13.2 Foreign institutional investors 4,836,488 0.8 410,387,290 35.8 415,223,778 24.1 Other shareholders 6,811,349 1.2 394,302,996 34.4 401,114,345 23.3 Treasury stock 1,697,538 0.3 21,797,490 1.9 23,495,028 1.4 573,627,483 100.0 1,146,031,245 100.0 1,719,658,728 100.0 *
Schedule of changes in treasury stocks	2020 Common shares R$ Preferred shares R$ Opening balance 1,697,538 557 19,020,418 241,985 Exercise of long-term incentive plan - - (2,220,660) (13,233) Closing balance 1,697,538 557 16,799,758 228,752 2019 Common shares R$ Preferred shares R$ Opening balance 1,697,538 557 21,797,490 279,869 Exercise of long-term incentive plan - - (2,777,072) (37,884) Closing balance 1,697,538 557 19,020,418 241,985 2018 Common shares R$ Preferred shares R$ Opening balance 1,697,538 557 8,704,061 75,528 Repurchases - - 16,000,000 243,396 Exercise of long-term incentive plan - - (1,597,235) (27,433) Transfer of shares - - (1,309,336) (11,622) Closing balance 1,697,538 557 21,797,490 279,869
Schedule of effects of interest changes in subsidiaries	December 31, 2020 Attributed to parent Non-controlling company’s interest interests Total (i) Other changes - 12,776 12,776 Effects of interest changes in subsidiaries - 12,776 12,776 December 31, 2019 Attributed to parent Non-controlling company’s interest interests Total (i) Other changes - (1,586) (1,586) Effects of interest changes in subsidiaries - (1,586) (1,586) December 31, 2018 Attributed to parent Non-controlling company’s interest interests Total (i) Other changes - (85,483) (85,483) Effects of interest changes in subsidiaries - (85,483) (85,483) (i) Other changes in subsidiaries without losing control, which may include among others, capital increases, other acquisitions of interests and dilutions of any nature.
Schedule of dividend amounts considered as distributed using the balance of the Investments and Working Capital Reserve	2020 2019 2018 Net income 2,365,763 1,203,736 2,303,868 Constitution of legal reserve (109,649) (55,876) (115,193) Constitution of the tax incentives reserve (172,792) (86,216) (17,051) Net income before dividends and interest on capital 2,083,322 1,061,644 2,171,624 Dividends and interest on capital (714,487) (356,539) (765,339) Net income before constitution of investments and working capital reserve 1,368,835 705,105 1,406,285 Constitution of investments and working capital reserve (1,368,835) (705,105) (1,406,285)
Schedule of dividends and interest on capital	Dividends and interest on capital in the years Outstanding shares Period Nature R$ /share (thousands) Credit Payment 2020 2019 2018 1st quarter Dividends - - - - - 118,803 - 1st quarter Interest - - - - - - 136,152 2nd quarter Dividends - - - - - 118,817 - 2nd quarter Interest - - - - - - 238,293 3rd quarter Dividends 0.12 1,701,161 11/6/2020 11/19/2020 204,139 67,951 221,278 4th quarter Dividends - - - - - 50,968 169,616 4th quarter Interest 0.17 1,701,161 12/21/2020 3/25/2021 289,197 - - 4th quarter Interest 0.13 1,701,161 3/11/2021 3/25/2021 221,151 - - Proposed Interest and Dividends 714,487 356,539 765,339 Credit per share (R$) 0.42 0.21 0.45

EARNINGS (LOSS) PER SHARE (EP_2

EARNINGS (LOSS) PER SHARE (EPS) (Tables)	12 Months Ended
	Dec. 31, 2020
EARNINGS (LOSS) PER SHARE (EPS)
Schedule of basic and diluted earnings (loss) per share	Basic 2020 Common Preferred Total (in thousands, except share and per share data) Basic numerator Allocated net income available to common and preferred shareholders 795,617 1,570,146 2,365,763 Basic denominator Weighted-average outstanding shares, after deducting the average tresuary shares 571,929,945 1,128,700,478 Earnings per share (in R$) — Basic 1.39 1.39 2019 Common Preferred Total (in thousands, except share and per share data) Basic numerator Allocated net income available to common and preferred shareholders 405,607 798,129 1,203,736 Basic denominator Weighted-average outstanding shares, after deducting the average tresuary shares 571,929,945 1,125,408,180 Earnings per share (in R$) — Basic 0.71 0.71 2018 Common Preferred Total (in thousands, except share and per share data) Basic numerator Allocated net income available to common and preferred shareholders 774,279 1,529,589 2,303,868 Basic denominator Weighted-average outstanding shares, after deducting the average tresuary shares 571,929,945 1,129,851,598 Earnings per share (in R$) — Basic 1.35 1.35 Diluted 2020 2019 2018 Diluted numerator Allocated net income available to Common and Preferred shareholders Net income allocated to preferred shareholders 1,570,146 798,129 1,529,589 Add: Adjustment to net income allocated to preferred shareholders in respect to the potential increase in number of preferred shares outstanding, as a result of long-term incentive plans of Gerdau. 5,524 2,884 6,515 1,575,670 801,013 1,536,104 Net income allocated to common shareholders 795,617 405,607 774,279 Less: Adjustment to net income allocated to preferred shareholders in respect to the potential increase in number of preferred shares outstanding, as a result of long-term incentive plans of Gerdau. (4,782) (2,884) (6,515) 790,835 402,723 767,764 Diluted denominator Weighted - average number of shares outstanding Common Shares 571,929,945 571,929,945 571,929,945 Preferred Shares Weighted-average number of preferred shares outstanding 1,128,700,478 1,125,408,180 1,129,851,598 Potential increase in number of preferred shares outstanding in respect of long-term incentive plan of Gerdau 10,821,083 12,157,614 14,440,860 Total 1,139,521,561 1,137,565,794 1,144,292,458 Earnings per share — Diluted (Common and Preferred Shares) 1.38 0.70 1.34

NET SALES (Tables)

NET SALES (Tables)	12 Months Ended
	Dec. 31, 2020
NET SALES
Schedule of net sales revenues	2020 2019 2018 Gross sales 49,658,208 44,558,309 51,861,423 Taxes on sales (4,377,135) (3,819,812) (3,793,516) Discounts (1,466,412) (1,094,487) (1,908,429) Net sales 43,814,661 39,644,010 46,159,478

LONG-TERM INCENTIVE PLANS (Tabl

LONG-TERM INCENTIVE PLANS (Tables)	12 Months Ended
	Dec. 31, 2020
LONG-TERM INCENTIVE PLANS
Summary of changes in restricted and performance shares	Balance on January 1, 2018 18,975,084 Granted 2,411,345 Cancelled (3,150,635) Exercised (3,974,293) Balance on December 31, 2018 14,261,501 Granted 2,647,995 Cancelled (2,104,754) Exercised (1,786,335) Balance on December 31, 2019 13,018,407 Granted 3,146,696 Cancelled (1,777,100) Exercised (1,918,669) Balance on December 31, 2020 12,469,334
Summary of stock options by exercise price	2020 2019 2018 Average exercise Average exercise Average exercise Number of shares price in the year Number of shares price in the year Number of shares price in the year R$ R$ R$ Available at beginning of the year - - 15,480 16.72 292,391 17.91 Options Exercised - - - - (33,499) 14.86 Options Forfeited - - (15,480) 16.72 (243,412) 18.62 Available at the end of the year - - - - 15,480 16.72

SEGMENT REPORTING (Tables)

SEGMENT REPORTING (Tables)	12 Months Ended
	Dec. 31, 2020
SEGMENT REPORTING
Schedule of company's segment information classified according to the business segments	Business Segments 2020 North America South America Special Steel Eliminations and Brazil Operation Operation Operation Operation Adjustments Consolidated Net sales 17,752,823 17,458,318 3,831,406 6,096,471 (1,324,357) 43,814,661 Cost of sales (14,179,991) (16,212,757) (3,015,189) (5,794,666) 1,318,501 (37,884,102) Gross profit 3,572,832 1,245,561 816,217 301,805 (5,856) 5,930,559 Selling, general and administrative expenses (562,019) (476,518) (116,479) (179,822) (195,547) (1,530,385) Other operating income (expenses) 31,500 97,751 16,684 55,097 916,667 1,117,699 Impairment of non-financial assets - (342,355) - (69,570) - (411,925) Impairment of financial assets (23,177) (36,286) (2,436) (2,233) - (64,132) Equity in earnings of unconsolidated companies (1,287) 23,512 99,341 8,899 22,104 152,569 Operational income before financial income (expenses) and taxes 3,017,849 511,665 813,327 114,176 737,368 5,194,385 Financial result, net (442,972) (206,405) (60,787) (215,433) (773,110) (1,698,707) Income (Loss) before taxes 2,574,877 305,260 752,540 (101,257) (35,742) 3,495,678 Income and social contribution taxes (652,126) (178,447) (195,440) 13,229 (94,840) (1,107,624) Net income (Loss) 1,922,751 126,813 557,100 (88,028) (130,582) 2,388,054 Supplemental information: Net sales between segments 1,149,618 60,370 41 114,328 - 1,324,357 Depreciation/amortization 1,135,294 777,369 142,143 444,298 - 2,499,104 Investments in associates and joint ventures 10,186 908,338 976,046 231,152 145,907 2,271,629 Total assets 21,099,735 18,583,439 5,448,922 11,233,676 6,757,237 63,123,009 Total liabilities 7,469,541 5,261,820 1,360,098 1,994,575 15,951,765 32,037,799 Business Segments 2019 North America South America Special Steel Eliminations and Brazil Operation Operation Operation Operation Adjustments Consolidated Net sales 16,122,171 14,656,028 3,259,253 6,701,900 (1,095,342) 39,644,010 Cost of sales (14,363,253) (13,351,209) (2,762,157) (6,167,502) 1,203,395 (35,440,726) Gross profit 1,758,918 1,304,819 497,096 534,398 108,053 4,203,284 Selling, general and administrative expenses (539,344) (444,326) (119,627) (170,170) (156,989) (1,430,456) Other operating income (expenses) 295,818 44,660 17,416 35,571 55,734 449,200 Impairment of financial assets (2,012) (14,612) (1,906) (2,513) - (21,044) Equity in earnings of unconsolidated companies (828) (110,959) 66,468 6,776 21,493 (17,050) Operational income before financial income (expenses) and taxes 1,512,552 779,582 459,447 404,062 28,291 3,183,934 Financial result, net (520,821) (99,029) (163,459) (109,116) (616,789) (1,509,214) Income (Loss) before taxes 991,731 680,553 295,988 294,946 (588,498) 1,674,720 Income and social contribution taxes (214,400) (188,458) (100,341) (60,749) 106,115 (457,833) Net income (Loss) 777,331 492,095 195,647 234,197 (482,383) 1,216,887 Supplemental information: Net sales between segments 920,659 62,196 - 112,487 - 1,095,342 Depreciation/amortization 1,008,713 571,015 120,462 374,105 - 2,074,295 Investments in associates and joint ventures 11,472 681,807 748,392 224,201 146,527 1,812,399 Total assets 17,195,824 15,178,053 4,562,604 8,597,180 8,469,309 54,002,970 Total liabilities 4,686,686 4,506,771 996,876 1,604,885 15,034,625 26,829,843 Business Segments 2018 North America South America Special Steel Eliminations and Brazil Operation Operation Operation Operation Adjustments Consolidated Net sales 15,745,161 19,927,390 3,801,210 8,158,626 (1,472,909) 46,159,478 Cost of sales (13,044,433) (18,164,834) (3,230,952) (7,064,608) 1,494,727 (40,010,100) Gross profit 2,700,728 1,762,556 570,258 1,094,018 21,818 6,149,378 Selling, general and administrative expenses (569,595) (602,351) (132,245) (180,251) (168,438) (1,652,880) Other operating income (expenses) (33,814) 19,114 (11,421) 10,081 (18,952) (34,992) Impairment of financial assets 5,564 (5,230) (4,462) (5,786) - (9,914) Gains and losses on assets held for sale and sales of interest in subsidiaries - - - - (414,507) (414,507) Equity in earnings of unconsolidated companies (1,700) (77,872) 51,648 15,629 22,436 10,141 Operational (Loss) income before financial income (expenses) and taxes 2,101,183 1,096,217 473,778 933,691 (557,643) 4,047,226 Financial result, net (442,966) (37,351) (117,270) (112,109) (1,180,099) (1,889,795) Income (Loss) before taxes 1,658,217 1,058,866 356,508 821,582 (1,737,742) 2,157,431 Income and social contribution taxes (410,651) (224,897) (86,667) (191,386) 1,082,552 168,951 Net income (Loss) 1,247,566 833,969 269,841 630,196 (655,190) 2,326,382 Supplemental information: Net sales between segments 1,280,770 84,335 4,988 102,816 - 1,472,909 Depreciation/amortization 951,826 511,154 88,537 340,297 - 1,891,814 Investments in associates and joint ventures 3,250 301,271 701,233 213,899 148,149 1,367,802 Total assets 17,473,039 14,659,926 4,421,487 8,825,830 5,900,747 51,281,029 Total liabilities 8,072,380 4,935,210 1,053,007 1,736,085 9,545,776 25,342,458
Schedule of company's geographic information classified according to the geographical region	Geographic Area Brazil Latin America (1) North America (2) Europe/Asia Consolidated 2020 2020 2020 2020 2020 Net sales 18,798,384 4,996,434 20,019,843 - 43,814,661 Total assets 28,752,629 7,042,462 27,327,918 - 63,123,009 Geographic Area Brazil Latin America (1) North America (2) Europe/Asia Consolidated 2019 2019 2019 2019 2019 Net sales 17,573,278 4,201,165 17,869,567 - 39,644,010 Total assets 26,124,159 5,781,527 22,097,284 - 54,002,970 Geographic Area Brazil Latin America (1) North America (2) Europe/Asia Consolidated 2018 2018 2018 2018 2018 Net sales 17,284,473 4,785,281 23,524,381 565,343 46,159,478 Total assets 26,283,287 5,251,637 19,746,105 - 51,281,029 (1) Does not include operations of Brazil (2) Does not include operations of Mexico

INSURANCE (Tables)

INSURANCE (Tables)	12 Months Ended
	Dec. 31, 2020
INSURANCE
Schedule of types of insurance	Type Scope 2020 2019 Assets Inventories and property, plant and equipment items are insured against fire, electrical damage, explosion, machine breakage and overflow (leakage of material in fusion state). 82,836,077 61,187,789 Business Interruption Net income plus fixed expenses 11,146,083 11,381,183 Civil Liability Industrial operations 711,948 652,973

EXPENSES BY NATURE (Tables)

EXPENSES BY NATURE (Tables)	12 Months Ended
	Dec. 31, 2020
EXPENSES BY NATURE
Schedule of expenses classified by nature	2020 2019 2018 Depreciation and amortization (2,499,104) (2,074,295) (1,891,814) Labor expenses (5,867,265) (5,175,373) (5,724,352) Raw material and consumption material (26,945,440) (25,890,618) (29,623,418) Freight (2,572,293) (2,300,439) (2,770,516) Impairment of non-financial assets (411,925) - - Gains and losses on assets held for sale and sales of interest in subsidiaries - - (414,507) Other expenses/income, net (476,818) (1,002,301) (1,697,786) (38,772,845) (36,443,026) (42,122,393) Classified as: Cost of sales (37,884,102) (35,440,726) (40,010,100) Selling expenses (512,950) (476,339) (570,431) General and administrative expenses (1,017,435) (954,117) (1,082,449) Other operating income 1,763,684 636,847 235,421 Other operating expenses (645,985) (187,647) (270,413) Impairment of financial assets (64,132) (21,044) (9,914) Impairment of non-financial assets (411,925) - - Gains and losses on assets held for sale and sales of interest in subsidiaries - - (414,507) (38,772,845) (36,443,026) (42,122,393)

FINANCIAL INCOME (Tables)

FINANCIAL INCOME (Tables)	12 Months Ended
	Dec. 31, 2020
FINANCIAL INCOME
Schedule of financial income	2020 2019 2018 Income from short-term investments 108,057 87,241 68,721 Interest income and other financial income 86,035 135,972 135,279 Financial Income 194,092 223,213 204,000 Interest on debt (1,022,460) (938,120) (1,177,686) Monetary variation and other financial expenses (426,001) (531,634) (401,655) Financial Expenses (1,448,461) (1,469,754) (1,579,341) Bonds repurchases (239,273) - (223,925) Exchange Variation, net (204,291) (247,555) (322,621) Gains and losses on derivative financial instruments, net (774) (15,118) 32,092 Financial result, net (1,698,707) (1,509,214) (1,889,795)

SUMMARY OF SIGNIFICANT ACCOUN_3

SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES (Details)	12 Months Ended
	Dec. 31, 2019shares
Dividends and Interest on equity
Minimum annual mandatory dividend (as a percent)	30.00%
Legal reserve, as a percent of net income	5.00%
Earnings per Share
Antidilutive shares excluded from calculation of diluted EPS	0

CONSOLIDATED FINANCIAL STATEM_3

CONSOLIDATED FINANCIAL STATEMENTS - Subsidiaries (Details)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Gerdau GTL Spain S.L.
Significant consolidated subsidiaries
Equity Interests (as a percent)	100.00%	100.00%	100.00%
Gerdau Internacional Empreendimentos Ltda. - Grupo Gerdau
Significant consolidated subsidiaries
Equity Interests (as a percent)	100.00%	100.00%	100.00%
Gerdau Ameristeel Corporation and subsidiaries
Significant consolidated subsidiaries
Equity Interests (as a percent)	100.00%	100.00%	100.00%
Gerdau Acominas S.A. and subsidiary
Significant consolidated subsidiaries
Equity Interests (as a percent)	99.86%	99.83%	99.83%
Gerdau Aos Longos S.A. and subsidiaries
Significant consolidated subsidiaries
Equity Interests (as a percent)	99.82%	99.82%	99.78%
Gerdau Steel Inc.
Significant consolidated subsidiaries
Equity Interests (as a percent)	100.00%	100.00%	100.00%
Gerdau Holdings Inc. and subsidiary
Significant consolidated subsidiaries
Equity Interests (as a percent)	100.00%	100.00%	100.00%
Paraopeba - Fixed-income investment fund
Significant consolidated subsidiaries
Equity Interests (as a percent)	89.26%	96.96%	91.40%
Percent of participation in investment fund	92.58%	98.07%	98.60%
Gerdau Hungria Holdings Limited Liability Company
Significant consolidated subsidiaries
Equity Interests (as a percent)	100.00%	100.00%	100.00%
GTL Equity Investments Corp.
Significant consolidated subsidiaries
Equity Interests (as a percent)	100.00%	100.00%	100.00%
Empresa Siderurgica del Peru S.A.A. - Siderperu
Significant consolidated subsidiaries
Equity Interests (as a percent)	90.03%	90.03%	90.03%
Gerdau Gtl Mexico S.A. de C.V. and subsidiaries
Significant consolidated subsidiaries
Equity Interests (as a percent)	100.00%	100.00%	100.00%
Seiva S.A. Florestas e Industrias
Significant consolidated subsidiaries
Equity Interests (as a percent)	97.73%	97.73%	97.73%
Gerdau Laisa S.A.
Significant consolidated subsidiaries
Equity Interests (as a percent)	100.00%	100.00%	100.00%
Sipar Gerdau Inversiones S.A.
Significant consolidated subsidiaries
Equity Interests (as a percent)	99.99%	99.99%	99.99%
Sipar Aceros S.A. and subsidiary
Significant consolidated subsidiaries
Equity Interests (as a percent)	99.98%	99.98%	99.98%
Sizuca - Siderurgica Zuliana C.A.
Significant consolidated subsidiaries
Equity Interests (as a percent)	100.00%	100.00%	100.00%
GTL Trade Finance Inc.
Significant consolidated subsidiaries
Equity Interests (as a percent)	100.00%	100.00%	100.00%
Gerdau Trade Inc.
Significant consolidated subsidiaries
Equity Interests (as a percent)	100.00%	100.00%	100.00%

CONSOLIDATED FINANCIAL STATEM_4

CONSOLIDATED FINANCIAL STATEMENTS - Joint ventures (Details) - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Joint ventures
Net income	R$ 2388054	R$ 1216887	R$ 2326382
Total comprehensive income (loss)	4,653,996	1,589,369	2,713,308
Joint ventures
Joint ventures
Net income	249,158	(21,548)	(16,403)
Total comprehensive income (loss)	R$ 249158	R$ 21548	R$ 16403
Bradley Steel Processors
Joint ventures
Equity Interests (as a percent)	50.00%	50.00%	50.00%
MRM Guide Rail
Joint ventures
Equity Interests (as a percent)	50.00%	50.00%	50.00%
Gerdau Corsa S.A.P.I de C.V.
Joint ventures
Equity Interests (as a percent)	70.00%	70.00%	50.00%
Capital increase		R$ 463990
Gerdau Metaldom Corp.
Joint ventures
Equity Interests (as a percent)	50.00%	50.00%	50.00%
Gerdau Summit Acos Fundidos e Forjados S.A.
Joint ventures
Equity Interests (as a percent)	58.73%	58.73%	58.73%
Diaco S.A.
Joint ventures
Equity Interests (as a percent)	49.87%	49.87%	49.87%
Juntos Somos Mais Fidelizacao S.A.
Joint ventures
Equity Interests (as a percent)	27.50%	27.50%	27.50%

CONSOLIDATED FINANCIAL STATEM_5

CONSOLIDATED FINANCIAL STATEMENTS - Associate companies (Details) - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Interest in Associate companies
Net income	R$ 2388054	R$ 1216887	R$ 2326382
Total comprehensive income	4,653,996	1,589,369	2,713,308
Associate companies
Interest in Associate companies
Net income	42,008	31,249	31,806
Total comprehensive income	R$ 42008	R$ 31249	R$ 31806
Dona Francisca Energtica S.A.
Interest in Associate companies
Equity Interests (as a percent)	51.82%	51.82%	51.82%
Corsa Controladora, S.A. de C.V.
Interest in Associate companies
Equity Interests (as a percent)			49.00%

CONSOLIDATED FINANCIAL STATEM_6

CONSOLIDATED FINANCIAL STATEMENTS - Acquisition of subsidiary (Details) - Siderurgica Latino-Americana SA ("SILAT") T in Thousands, R$ in Thousands	1 Months Ended
	Nov. 30, 2020BRL (R$)T
Fair value upon acquisition
Cash and cash equivalents	R$ 33419
Trade accounts receivable - net	13,190
Inventories	24,160
Other current assets	11,091
Property, plant and equipment	486,757
Other non-current assets	34,410
Current liabilities	(26,638)
Deferred income taxes	(86,093)
Other non-current liabilities	(359)
Non-controlling interest	(11,495)
Assets (Liabilities)	478,442
Bargain purchase	(2,481)
Fair value upon acquisition	475,961
Total consideration paid	475,961
Less: Cash and cash equivalents of acquired subsidiary	(33,419)
Total	R$ 442542
Gerdau Acos Longos S.A.
Acquisition of subsidiary
Percentage of equity interest acquired (as a percent)	96.35%
Fair value upon acquisition
Fair value upon acquisition	R$ 475961
Gerdau Acos Longos S.A. | Long steel rolled
Acquisition of subsidiary
Production capacity (in tons) | T	600

CONSOLIDATED FINANCIAL STATEM_7

CONSOLIDATED FINANCIAL STATEMENTS - Gains and losses on assets held for sale and sale of interest in subsidiaries (Details) R$ in Thousands, $ in Millions

Nov. 05, 2018USD ($)item

Oct. 31, 2018USD ($)

Jul. 31, 2018BRL (R$)item

Jun. 29, 2018USD ($)Plant

Mar. 30, 2018USD ($)

Mar. 30, 2018BRL (R$)

Dec. 31, 2020BRL (R$)

Dec. 31, 2019BRL (R$)

Dec. 31, 2018BRL (R$)

Nov. 05, 2018BRL (R$)

Oct. 31, 2018BRL (R$)

Jun. 29, 2018BRL (R$)

Gains and losses on assets held for sale and sales of interest in subsidiaries

Expenses attributable to assets held for sale and sales of interest in subsidiaries | R$

R$ 0

R$ 0

R$ 414507

Optimus Steel LLC

Gains and losses on assets held for sale and sales of interest in subsidiaries

Proceeds from sale

$ 99.5

R$ 330700

Aza Participacoes SpA and subsidiaries

Gains and losses on assets held for sale and sales of interest in subsidiaries

Proportion of ownership interest in subsidiary sold

100.00%

Number of production plants | Plant

3

Total value of sale

$ 154.1

R$ 594200

Cacu and Barra dos Coqueiros hydroelectric plants

Gains and losses on assets held for sale and sales of interest in subsidiaries

Number of hydroelectric plants | item

2

Proceeds from sale | R$

R$ 835000

Gerdau Hungria KFT Y CIA Sociedad Regular Colectiva

Gains and losses on assets held for sale and sales of interest in subsidiaries

Proportion of ownership interest in subsidiary sold

98.89%

Total value of sale

$ 120

R$ 490200

Gerdau Hungria KFT Y CIA Sociedad Regular Colectiva | INDIA

Gains and losses on assets held for sale and sales of interest in subsidiaries

Proportion of ownership interest in subsidiary sold

100.00%

Sale of production units and distribution centers in the U.S.

Gains and losses on assets held for sale and sales of interest in subsidiaries

Number of rebar-producing mills | item

4

Total value of sale

$ 600

R$ 2222900

CASH AND CASH EQUIVALENTS, AN_3

CASH AND CASH EQUIVALENTS, AND SHORT AND LONG-TERM INVESTMENTS (Details) - BRL (R$) R$ in Thousands	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
CASH AND CASH EQUIVALENTS, AND SHORT AND LONG-TERM INVESTMENTS
Cash	R$ 9060	R$ 12302
Banks and immediately available investments	4,608,144	2,629,350
Total cash and cash equivalents	4,617,204	2,641,652	R$ 2890144	R$ 2555338
Short-term investments	R$ 3041143	R$ 3652949

TRADE ACCOUNTS RECEIVABLE - Sum

TRADE ACCOUNTS RECEIVABLE - Summary (Details) - BRL (R$) R$ in Thousands	Dec. 31, 2020	Dec. 31, 2019
TRADE ACCOUNTS RECEIVABLE
Trade accounts receivable	R$ 3737270	R$ 2672370
Gross | in Brazil
TRADE ACCOUNTS RECEIVABLE
Trade accounts receivable	2,081,740	1,193,971
Gross | exports from Brazil
TRADE ACCOUNTS RECEIVABLE
Trade accounts receivable	26,121	117,274
Gross | outside of Brazil
TRADE ACCOUNTS RECEIVABLE
Trade accounts receivable	1,766,555	1,459,204
Accumulated impairment losses
TRADE ACCOUNTS RECEIVABLE
Trade accounts receivable	R$ 137146	R$ 98079

TRADE ACCOUNTS RECEIVABLE - Acc

TRADE ACCOUNTS RECEIVABLE - Accounts receivable by aging (Details) - BRL (R$) R$ in Thousands	Dec. 31, 2020	Dec. 31, 2019
TRADE ACCOUNTS RECEIVABLE
Trade accounts receivable	R$ 3737270	R$ 2672370
Accumulated impairment losses
TRADE ACCOUNTS RECEIVABLE
Trade accounts receivable	(137,146)	(98,079)
Current | Gross
TRADE ACCOUNTS RECEIVABLE
Trade accounts receivable	3,466,000	2,226,121
Past due: Up to 30 days | Gross
TRADE ACCOUNTS RECEIVABLE
Trade accounts receivable	259,756	381,999
Past due: From 31 to 60 days | Gross
TRADE ACCOUNTS RECEIVABLE
Trade accounts receivable	48,905	58,972
Past due: From 61 to 90 days | Gross
TRADE ACCOUNTS RECEIVABLE
Trade accounts receivable	9,355	30,202
Past-due: From 91 to 180 days | Gross
TRADE ACCOUNTS RECEIVABLE
Trade accounts receivable	13,636	15,384
Past-due: From 181 to 360 days | Gross
TRADE ACCOUNTS RECEIVABLE
Trade accounts receivable	15,899	16,739
Past due: Above 360 days | Gross
TRADE ACCOUNTS RECEIVABLE
Trade accounts receivable	R$ 60865	R$ 41032

TRADE ACCOUNTS RECEIVABLE - Cha

TRADE ACCOUNTS RECEIVABLE - Changes in impairment (Details) - Trade accounts receivable - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Changes in the impairment on financial assets on financial assets
Balance, beginning of year	R$ 98079	R$ 158157	R$ 179702
Impairment on financial assets during the year	(148,548)	(81,243)	(111,900)
Recoveries in the year	84,416	60,199	101,986
Write-offs	36,210	78,635	39,943
Exchange variation	(11,145)	2,487	(5,136)
Assets held for sale			(3,348)
Balance, end of year	R$ 137146	R$ 98079	R$ 158157

INVENTORIES - Summary (Details)

INVENTORIES - Summary (Details) - BRL (R$) R$ in Thousands	Dec. 31, 2020	Dec. 31, 2019
INVENTORIES
Inventories	R$ 9169417	R$ 7659737
Gross
INVENTORIES
Finished products	3,894,698	3,302,569
Work in progress	2,045,158	1,426,607
Raw materials	1,934,958	1,611,334
Storeroom supplies	786,401	974,412
Imports in transit	514,321	384,123
Accumulated impairment losses
INVENTORIES
Inventories	R$ 6119	R$ 39308

INVENTORIES - Allowance for adj

INVENTORIES - Allowance for adjustment to net realizable value of inventories (Details) - Inventories - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Allowance for adjustment to net realizable value of inventories
Balance, beginning of year	R$ 39308	R$ 13704	R$ 3556
Provision for the year	(6,562)	(46,693)	(11,943)
Reversal of adjustments to net realizable value	47,259	22,028	3,715
Exchange rate variation	(7,508)	(939)	(871)
Assets held for sale			(1,049)
Balance, end of year	R$ 6119	R$ 39308	R$ 13704

TAX CREDITS - Current and Non-c

TAX CREDITS - Current and Non-current (Details) - BRL (R$) R$ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Disclosure of Tax credits
Tax credits - current	R$ 1201312	R$ 504302
Tax credits - non-current	664,045	465,549
Tax credits
Disclosure of Tax credits
Tax credits - current	1,201,312	504,302
Tax credits - non-current	664,045	465,549
Tax credits - current and non-current	1,865,357	969,851
ICMS (state VAT)
Disclosure of Tax credits
Tax credits - current	297,926	279,483
Tax credits - non-current	64,163	51,615
Social security financing
Disclosure of Tax credits
Tax credits - current	632,927	104,704
Tax credits - non-current	441,111	331,435
Financing of social integration program
Disclosure of Tax credits
Tax credits - current	171,724	26,198
Financing of social integration program and others
Disclosure of Tax credits
Tax credits - non-current	158,771	82,499
IPI (federal VAT)
Disclosure of Tax credits
Tax credits - current	38,174	26,173
IVA (Value-added tax)
Disclosure of Tax credits
Tax credits - current	24,500	41,958
Others
Disclosure of Tax credits
Tax credits - current	R$ 36061	R$ 25786

TAX CREDITS - Realization of no

TAX CREDITS - Realization of non-current tax credits (Details) - BRL (R$) R$ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Estimates of realization of non-current tax credits
Tax credits - non-current	R$ 664045	R$ 465549
Tax credits
Estimates of realization of non-current tax credits
Tax credits - non-current	664,045	465,549
Tax credits | 2021
Estimates of realization of non-current tax credits
Tax credits - non-current		190,773
Tax credits | 2022
Estimates of realization of non-current tax credits
Tax credits - non-current	584,145	106,271
Tax credits | 2023
Estimates of realization of non-current tax credits
Tax credits - non-current	22,433	83,371
Tax credits | 2024
Estimates of realization of non-current tax credits
Tax credits - non-current	8,054	65,000
Tax credits | 2025 and after
Estimates of realization of non-current tax credits
Tax credits - non-current	R$ 49413	R$ 20134

INCOME AND SOCIAL CONTRIBUTIO_3

INCOME AND SOCIAL CONTRIBUTION TAXES - Reconciliation (Details) - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Reconciliations of taxes at statutory rates to amounts presented in the Statement of Income
Income (loss) before income taxes	R$ 3495678	R$ 1674720	R$ 2157431
Statutory tax rates	34.00%	34.00%	34.00%
Income and social contribution taxes at statutory rates	R$ 1188531	R$ 569405	R$ 733527
Tax adjustment with respect to:
Difference in tax rates in foreign companies	530,715	75,428	663,116
Equity in earnings of unconsolidated companies	51,873	(5,797)	3,448
Interest on equity	98,739	69	128,418
Tax credits and incentives	31,800	8,852	9,531
Deferred tax assets not recognized	(592,861)
Recognition of previously unrecognized tax losses	4,944	1,097	47,545
Other permanent differences, net	(44,303)	31,923	50,420
Income and social contribution taxes	(1,107,624)	(457,833)	168,951
Current	(908,051)	(240,400)	(629,209)
Deferred	R$ 199573	R$ 217433	R$ 798160
Income taxes
Reconciliations of taxes at statutory rates to amounts presented in the Statement of Income
Statutory tax rates	25.00%	25.00%	25.00%
Social contribution taxes
Reconciliations of taxes at statutory rates to amounts presented in the Statement of Income
Statutory tax rates	9.00%	9.00%	9.00%
Foreign subsidiaries | Minimum
Reconciliations of taxes at statutory rates to amounts presented in the Statement of Income
Foreign tax rate	23.00%	23.00%	23.00%
Foreign subsidiaries | Maximum
Reconciliations of taxes at statutory rates to amounts presented in the Statement of Income
Foreign tax rate	34.00%	34.00%	34.00%
Foreign subsidiaries with mainly financial activities
Reconciliations of taxes at statutory rates to amounts presented in the Statement of Income
Foreign tax rate	0.00%	0.00%	0.00%

INCOME AND SOCIAL CONTRIBUTIO_4

INCOME AND SOCIAL CONTRIBUTION TAXES - Changes in net deferred asset (liability) (Details) - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Breakdown and changes in deferred income and social contribution tax assets and liabilities at statutory tax rates
Balance as of beginning of the year	R$ 3553806	R$ 3755686	R$ 2971707
Recognized in income	(199,573)	(217,433)	798,160
Others		(36,226)	31,103
Effect of selling of subsidiary and Others	(86,093)
Comprehensive Income	63,652	51,779	(45,284)
Balance as of end of the year	3,331,792	3,553,806	3,755,686
Tax loss carryforward
Breakdown and changes in deferred income and social contribution tax assets and liabilities at statutory tax rates
Balance as of beginning of the year	1,341,464	1,339,933	973,638
Recognized in income	(157,207)	4,781	341,664
Others		(36,226)	36,445
Comprehensive Income	36,228	32,976	(11,814)
Balance as of end of the year	1,220,485	1,341,464	1,339,933
Social contribution tax losses
Breakdown and changes in deferred income and social contribution tax assets and liabilities at statutory tax rates
Balance as of beginning of the year	350,810	337,258	355,782
Recognized in income	(60,534)	13,552	(18,524)
Balance as of end of the year	290,276	350,810	337,258
Provision for tax, civil and labor liabilities
Breakdown and changes in deferred income and social contribution tax assets and liabilities at statutory tax rates
Balance as of beginning of the year	242,794	270,417	275,463
Recognized in income	140,871	(27,848)	(5,214)
Others			168
Comprehensive Income	1,798	225
Balance as of end of the year	385,463	242,794	270,417
Benefits granted to employees
Breakdown and changes in deferred income and social contribution tax assets and liabilities at statutory tax rates
Balance as of beginning of the year	294,031	286,494	282,803
Recognized in income	(6,848)	(29,739)	(16,564)
Others			67,184
Comprehensive Income	105,074	37,276	(46,929)
Balance as of end of the year	392,257	294,031	286,494
Other temporary differences
Breakdown and changes in deferred income and social contribution tax assets and liabilities at statutory tax rates
Balance as of beginning of the year	575,719	525,818	410,300
Recognized in income	(114,627)	73,067	93,094
Others			17,177
Comprehensive Income	40,022	(23,166)	5,247
Balance as of end of the year	501,114	575,719	525,818
Deferred exchange variance
Breakdown and changes in deferred income and social contribution tax assets and liabilities at statutory tax rates
Balance as of beginning of the year	1,177,428	1,284,377	1,060,527
Recognized in income	(119,178)	(106,640)	223,850
Comprehensive Income	(709)	(309)
Balance as of end of the year	1,057,541	1,177,428	1,284,377
Provision for losses
Breakdown and changes in deferred income and social contribution tax assets and liabilities at statutory tax rates
Balance as of beginning of the year	23,618	83,837	110,728
Recognized in income	11,740	(75,142)	(33,165)
Others			(12)
Comprehensive Income	162	14,923	6,286
Balance as of end of the year	35,520	23,618	83,837
Fair value adjustments on businesses acquired
Breakdown and changes in deferred income and social contribution tax assets and liabilities at statutory tax rates
Balance as of beginning of the year	(452,058)	(372,448)	(497,534)
Recognized in income	106,210	(69,464)	213,019
Others			(89,859)
Effect of selling of subsidiary and Others	(86,093)
Comprehensive Income	(118,923)	(10,146)	1,926
Balance as of end of the year	R$ 550864	R$ 452058	R$ 372448

INCOME AND SOCIAL CONTRIBUTIO_5

INCOME AND SOCIAL CONTRIBUTION TAXES - Classification of net deferred asset (liability) (Details) - BRL (R$) R$ in Thousands	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
INCOME AND SOCIAL CONTRIBUTION TAXES
Total	R$ 3331792	R$ 3553806	R$ 3755686	R$ 2971707
Non-current assets	3,393,354	4,071,219	3,874,054	3,054,393
Non-current liabilities	R$ 61562	R$ 517413	R$ 118368	R$ 82686

INCOME AND SOCIAL CONTRIBUTIO_6

INCOME AND SOCIAL CONTRIBUTION TAXES - Estimated recovery and reversal of income and social contributions tax assets and liabilities (Details) - BRL (R$) R$ in Thousands	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Deferred income and social contribution tax assets and liabilities at statutory tax rates
Non-current assets	R$ 3393354	R$ 4071219	R$ 3874054	R$ 3054393
Non-current liabilities	(61,562)	(517,413)	R$ 118368	R$ 82686
2020
Deferred income and social contribution tax assets and liabilities at statutory tax rates
Non-current assets		605,657
2021
Deferred income and social contribution tax assets and liabilities at statutory tax rates
Non-current assets	616,409	467,153
Non-current liabilities	(8,558)	(98,449)
2022
Deferred income and social contribution tax assets and liabilities at statutory tax rates
Non-current assets	399,248	422,863
Non-current liabilities	(8,192)	(110,031)
2023
Deferred income and social contribution tax assets and liabilities at statutory tax rates
Non-current assets	391,610	464,514
Non-current liabilities	(14,815)	(90,703)
2024
Deferred income and social contribution tax assets and liabilities at statutory tax rates
Non-current assets	348,139	472,734
Non-current liabilities	(3,145)	(79,022)
2025 and after
Deferred income and social contribution tax assets and liabilities at statutory tax rates
Non-current assets	1,637,948	1,638,298
Non-current liabilities	R$ 26852	R$ 139208

INCOME AND SOCIAL CONTRIBUTIO_7

INCOME AND SOCIAL CONTRIBUTION TAXES - Unrecognized deferred income tax assets (Details) - BRL (R$) R$ in Thousands	Dec. 31, 2020	Dec. 31, 2019
INCOME AND SOCIAL CONTRIBUTION TAXES
Tax assets which have no expiration date	R$ 764845	R$ 263491
Foreign subsidiaries
INCOME AND SOCIAL CONTRIBUTION TAXES
Tax credits on capital losses for which no deferred tax asset recognised	1,180,067	668,729
Tax losses of state credits for which no deferred tax asset recognised	R$ 1623459	R$ 1384598

INVESTMENTS IN ASSOCIATES AND_3

INVESTMENTS IN ASSOCIATES AND JOINT VENTURES (Details) - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
INVESTMENTS IN ASSOCIATES AND JOINT VENTURES
Balance at beginning of year	R$ 1812399	R$ 1367802	R$ 1280299
Equity in earnings	152,569	(17,050)	10,141
Other comprehensive income	358,816	55,038	125,719
Capital increase	42,782	470,990	7,000
Capital reduction		(20,344)
Dividends/Interest on equity	(94,937)	44,037	55,357
Balance at end of year	2,271,629	1,812,399	1,367,802
Investments in North America
INVESTMENTS IN ASSOCIATES AND JOINT VENTURES
Balance at beginning of year	681,807	301,272	346,080
Equity in earnings	23,494	(111,637)	(77,909)
Other comprehensive income	165,479	28,182	33,101
Capital increase	42,782	463,990
Dividends/Interest on equity	(5,223)
Balance at end of year	908,339	681,807	301,272
Investments in South America
INVESTMENTS IN ASSOCIATES AND JOINT VENTURES
Balance at beginning of year	748,392	701,233	584,899
Equity in earnings	99,913	66,468	51,648
Other comprehensive income	195,286	21,282	96,045
Capital reduction		(20,344)
Dividends/Interest on equity	(67,546)	20,247	31,359
Balance at end of year	976,045	748,392	701,233
Investments in Special Steel
INVESTMENTS IN ASSOCIATES AND JOINT VENTURES
Balance at beginning of year	224,201	213,899	199,647
Equity in earnings	8,900	6,779	15,629
Other comprehensive income	(1,949)	3,523	(1,377)
Balance at end of year	231,152	224,201	213,899
Investments In Brazil
INVESTMENTS IN ASSOCIATES AND JOINT VENTURES
Balance at beginning of year	11,473	3,250
Equity in earnings	(1,288)	(828)	(1,700)
Other comprehensive income		2,051	(2,050)
Capital increase		7,000	7,000
Balance at end of year	10,185	11,473	3,250
Others
INVESTMENTS IN ASSOCIATES AND JOINT VENTURES
Balance at beginning of year	146,526	148,148	149,673
Equity in earnings	21,550	22,168	22,473
Dividends/Interest on equity	(22,168)	23,790	23,998
Balance at end of year	R$ 145908	R$ 146526	R$ 148148

PROPERTY, PLANT AND EQUIPMENT -

PROPERTY, PLANT AND EQUIPMENT - Changes (Details) - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
PROPERTY, PLANT AND EQUIPMENT
Balance, beginning of the year	R$ 15901493	R$ 15546481
Impairment of non-financial assets	(411,925)	0	R$ 0
Balance, end of the year	R$ 17252915	R$ 15901493	R$ 15546481
Average rate of capitalized interest	3.80%	6.00%	5.70%
Gross
PROPERTY, PLANT AND EQUIPMENT
Balance, beginning of the year	R$ 43291837	R$ 41072186	R$ 39940317
Additions	1,650,778	1,746,600	1,194,934
Capitalized interest	24,622	24,676	23,999
Disposals	(888,140)	(367,685)	(349,749)
Business Combination	486,757
Impairment of non-financial assets	(411,925)
Transfer to assets held for sale			(1,899,000)
Effects of IAS 29 adoption			699,724
Foreign exchange effect	4,941,281	816,060	1,461,961
Balance, end of the year	49,095,210	43,291,837	41,072,186
Accumulated depreciation
PROPERTY, PLANT AND EQUIPMENT
Balance, beginning of the year	(27,390,344)	(25,525,705)	(23,496,575)
Depreciation	(1,905,637)	(1,577,182)	(1,584,878)
Disposals	860,610	290,935	299,132
Transfer to assets held for sale			637,929
Effects of IAS 29 adoption			(265,654)
Foreign exchange effect	(3,406,924)	(578,392)	(1,115,659)
Balance, end of the year	(31,842,295)	(27,390,344)	(25,525,705)
Land and buildings
PROPERTY, PLANT AND EQUIPMENT
Balance, beginning of the year	4,399,481	4,518,944
Balance, end of the year	4,795,317	4,399,481	4,518,944
Land and buildings | Gross
PROPERTY, PLANT AND EQUIPMENT
Balance, beginning of the year	8,912,943	8,700,749	9,085,698
Additions	50,848	28,449	13,739
Transfers	207,551	115,452	140,334
Disposals	(226,920)	(54,699)	(45,290)
Business Combination	275,076
Impairment of non-financial assets	(198,196)
Transfer to assets held for sale			(784,464)
Foreign exchange effect	918,554	122,992	290,732
Balance, end of the year	9,939,856	8,912,943	8,700,749
Land and buildings | Accumulated depreciation
PROPERTY, PLANT AND EQUIPMENT
Balance, beginning of the year	(4,513,462)	(4,181,805)	(3,915,023)
Depreciation	(413,252)	(295,615)	(291,315)
Transfers			18,341
Disposals	223,174	38,826	29,944
Transfer to assets held for sale			105,787
Foreign exchange effect	(440,999)	(74,868)	(129,539)
Balance, end of the year	(5,144,539)	(4,513,462)	(4,181,805)
Machines, equipment, and installations
PROPERTY, PLANT AND EQUIPMENT
Balance, beginning of the year	9,189,797	9,242,177
Balance, end of the year	9,366,248	9,189,797	9,242,177
Machines, equipment, and installations | Gross
PROPERTY, PLANT AND EQUIPMENT
Balance, beginning of the year	31,031,208	29,608,998	28,016,604
Additions	98,372	76,756	66,764
Transfers	695,512	884,161	802,664
Disposals	(505,580)	(165,139)	(285,860)
Business Combination	173,453
Impairment of non-financial assets	(213,729)
Transfer to assets held for sale			(749,425)
Effects of IAS 29 adoption			699,724
Foreign exchange effect	3,621,233	626,432	1,058,527
Balance, end of the year	34,900,469	31,031,208	29,608,998
Machines, equipment, and installations | Accumulated depreciation
PROPERTY, PLANT AND EQUIPMENT
Balance, beginning of the year	(21,841,411)	(20,366,821)	(18,576,836)
Depreciation	(1,354,559)	(1,136,040)	(1,128,138)
Transfers		(20)	5,234
Disposals	497,434	145,019	258,609
Transfer to assets held for sale			286,204
Effects of IAS 29 adoption			(265,654)
Foreign exchange effect	(2,835,685)	(483,549)	(946,240)
Balance, end of the year	(25,534,221)	(21,841,411)	(20,366,821)
Data electronic equipment
PROPERTY, PLANT AND EQUIPMENT
Balance, beginning of the year	72,127	66,132
Balance, end of the year	64,468	72,127	66,132
Data electronic equipment | Gross
PROPERTY, PLANT AND EQUIPMENT
Balance, beginning of the year	802,549	753,078	711,638
Additions	9,765	13,955	11,811
Transfers	13,653	24,037	457
Disposals	(11,487)	(1,890)	(5,641)
Business Combination	29
Transfer to assets held for sale			(14,914)
Foreign exchange effect	107,634	13,369	49,727
Balance, end of the year	922,143	802,549	753,078
Data electronic equipment | Accumulated depreciation
PROPERTY, PLANT AND EQUIPMENT
Balance, beginning of the year	(730,422)	(686,946)	(622,234)
Depreciation	(37,616)	(33,143)	(34,814)
Transfers			158
Disposals	11,169	1,818	2,609
Transfer to assets held for sale			11,667
Foreign exchange effect	(100,806)	(12,151)	(44,332)
Balance, end of the year	(857,675)	(730,422)	(686,946)
Property, plant and equipment under construction
PROPERTY, PLANT AND EQUIPMENT
Balance, beginning of the year	1,515,729	1,021,247
Balance, end of the year	2,254,205	1,515,729	1,021,247
Property, plant and equipment under construction | Gross
PROPERTY, PLANT AND EQUIPMENT
Balance, beginning of the year	1,515,729	1,021,247	950,680
Additions	1,369,947	1,506,343	983,519
Capitalized interest	24,622	24,676	23,999
Transfers	(939,231)	(1,038,693)	(949,888)
Disposals		(40,314)	(3,352)
Business Combination	36,563
Transfer to assets held for sale			(49,579)
Foreign exchange effect	246,575	42,470	65,868
Balance, end of the year	2,254,205	1,515,729	1,021,247
Other
PROPERTY, PLANT AND EQUIPMENT
Balance, beginning of the year	724,359	697,981
Balance, end of the year	772,677	724,359	697,981
Other | Gross
PROPERTY, PLANT AND EQUIPMENT
Balance, beginning of the year	1,029,408	988,114	1,175,697
Additions	121,846	121,097	119,101
Transfers	22,515	15,043	6,433
Disposals	(144,153)	(105,643)	(9,606)
Business Combination	1,636
Transfer to assets held for sale			(300,618)
Foreign exchange effect	47,285	10,797	(2,893)
Balance, end of the year	1,078,537	1,029,408	988,114
Other | Accumulated depreciation
PROPERTY, PLANT AND EQUIPMENT
Balance, beginning of the year	(305,049)	(290,133)	(382,482)
Depreciation	(100,210)	(112,384)	(130,611)
Transfers		20	(23,733)
Disposals	128,833	105,272	7,970
Transfer to assets held for sale			234,271
Foreign exchange effect	(29,434)	(7,824)	4,452
Balance, end of the year	R$ 305860	R$ 305049	R$ 290133

PROPERTY, PLANT AND EQUIPMENT_2

PROPERTY, PLANT AND EQUIPMENT - Useful Lives (Details) - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
PROPERTY, PLANT AND EQUIPMENT
Amount of property, plant and equipment pledged as collateral for loans and financing	R$ 0	R$ 0	R$ 90463
Buildings | Minimum
PROPERTY, PLANT AND EQUIPMENT
Useful lives of property, plant, and equipment	10 years	10 years	10 years
Buildings | Maximum
PROPERTY, PLANT AND EQUIPMENT
Useful lives of property, plant, and equipment	33 years	33 years	33 years
Machines, equipment, and installations | Minimum
PROPERTY, PLANT AND EQUIPMENT
Useful lives of property, plant, and equipment	10 years	10 years	10 years
Machines, equipment, and installations | Maximum
PROPERTY, PLANT AND EQUIPMENT
Useful lives of property, plant, and equipment	20 years	20 years	20 years
Furniture and fixture | Minimum
PROPERTY, PLANT AND EQUIPMENT
Useful lives of property, plant, and equipment	5 years	5 years	5 years
Furniture and fixture | Maximum
PROPERTY, PLANT AND EQUIPMENT
Useful lives of property, plant, and equipment	10 years	10 years	10 years
Vehicles | Minimum
PROPERTY, PLANT AND EQUIPMENT
Useful lives of property, plant, and equipment	3 years	3 years	3 years
Vehicles | Maximum
PROPERTY, PLANT AND EQUIPMENT
Useful lives of property, plant, and equipment	5 years	5 years	5 years
Data electronic equipment | Minimum
PROPERTY, PLANT AND EQUIPMENT
Useful lives of property, plant, and equipment	2 years 6 months	2 years 6 months	2 years 6 months
Data electronic equipment | Maximum
PROPERTY, PLANT AND EQUIPMENT
Useful lives of property, plant, and equipment	6 years	6 years	6 years

PROPERTY, PLANT AND EQUIPMENT_3

PROPERTY, PLANT AND EQUIPMENT - Impairment (Details) - BRL (R$) R$ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Land, buildings and construction
PROPERTY, PLANT AND EQUIPMENT
Carrying value of impaired assets	R$ 345087	R$ 124761
Machines, equipment, and installations
PROPERTY, PLANT AND EQUIPMENT
Carrying value of impaired assets	710,476	504,287
Property, plant and equipment under construction
PROPERTY, PLANT AND EQUIPMENT
Carrying value of impaired assets	R$ 543726	R$ 543726

GOODWILL - Changes in Goodwill

GOODWILL - Changes in Goodwill (Details) - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Changes in goodwill
Goodwill at beginning of the year	R$ 9469311	R$ 9112390	R$ 7891142
Foreign exchange effect	2,634,208	356,921	1,221,248
Impairment	0	0	0
Goodwill at end of the year	12,103,519	9,469,311	9,112,390
Gross
Changes in goodwill
Goodwill at beginning of the year	17,445,205	16,783,958	14,500,381
Foreign exchange effect	4,976,383	661,247	2,283,577
Goodwill at end of the year	22,421,588	17,445,205	16,783,958
Accumulated impairment losses
Changes in goodwill
Goodwill at beginning of the year	(7,975,894)	(7,671,568)	(6,609,239)
Foreign exchange effect	(2,342,175)	(304,326)	(1,062,329)
Goodwill at end of the year	R$ 10318069	R$ 7975894	R$ 7671568

GOODWILL - Goodwill by segment

GOODWILL - Goodwill by segment (Details) - BRL (R$) R$ in Thousands	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Goodwill by segment
Goodwill	R$ 12103519	R$ 9469311	R$ 9112390	R$ 7891142
Brazil
Goodwill by segment
Goodwill	373,135	373,135	373,135
Special Steel
Goodwill by segment
Goodwill	3,828,841	2,969,752	2,854,888
North America
Goodwill by segment
Goodwill	R$ 7901543	R$ 6126424	R$ 5884367

INTANGIBLE ASSETS - Changes in

INTANGIBLE ASSETS - Changes in intangible assets by type (Details) - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
INTANGIBLE ASSETS
Balance at beginning of the year	R$ 673262	R$ 836096	R$ 972089
Foreign exchange effect	127,770	19,195	107,434
Acquisition	154,250	100,313	67,388
Disposal			(3,879)
Amortization	(332,704)	(282,342)	(306,936)
Balance at end of the year	622,578	673,262	836,096
Supplier relationships
INTANGIBLE ASSETS
Balance at beginning of the year	21,415	26,719	32,786
Amortization	(4,637)	(5,304)	(6,067)
Balance at end of the year	16,778	21,415	26,719
Software development
INTANGIBLE ASSETS
Balance at beginning of the year	364,812	415,640	490,829
Foreign exchange effect	42,890	6,137	28,598
Acquisition	154,250	100,313	67,388
Disposal			(3,791)
Amortization	(188,083)	(157,278)	(167,384)
Balance at end of the year	R$ 373869	364,812	415,640
Estimated useful lives	7 years
Customers contracts and relationships
INTANGIBLE ASSETS
Balance at beginning of the year	R$ 283423	387,299	440,774
Foreign exchange effect	83,806	12,586	77,593
Disposal			(88)
Amortization	(136,525)	(116,462)	(130,980)
Balance at end of the year	230,704	283,423	387,299
Others
INTANGIBLE ASSETS
Balance at beginning of the year	3,612	6,438	7,700
Foreign exchange effect	1,074	472	1,243
Amortization	(3,459)	(3,298)	(2,505)
Balance at end of the year	R$ 1227	R$ 3612	R$ 6438
Estimated useful lives	5 years
Minimum | Supplier relationships
INTANGIBLE ASSETS
Estimated useful lives	5 years
Minimum | Customers contracts and relationships
INTANGIBLE ASSETS
Estimated useful lives	5 years
Maximum | Supplier relationships
INTANGIBLE ASSETS
Estimated useful lives	20 years
Maximum | Customers contracts and relationships
INTANGIBLE ASSETS
Estimated useful lives	20 years

INTANGIBLE ASSETS - Intangible

INTANGIBLE ASSETS - Intangible assets by segment (Details) - BRL (R$) R$ in Thousands	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Composition of other intangible assets by segment
Other intangible assets	R$ 622578	R$ 673262	R$ 836096	R$ 972089
Brazil
Composition of other intangible assets by segment
Other intangible assets	220,303	238,243	295,107
Special Steel
Composition of other intangible assets by segment
Other intangible assets	156,557	132,934	136,910
South America
Composition of other intangible assets by segment
Other intangible assets	1,534	1,729	1,441
North America
Composition of other intangible assets by segment
Other intangible assets	R$ 244184	R$ 300356	R$ 402638

LEASING - Right-of-use assets (

LEASING - Right-of-use assets (Details) - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Summary of changes in the Right-of-use assets
Balance at beginning of the year	R$ 777314
Balance at end of the year	815,311	R$ 777314
Gross
Summary of changes in the Right-of-use assets
Balance at beginning of the year	987,135	836,368
Additions	234,823	143,521
Disposals	(30,605)	(35,555)
Remeasurements	9,693	32,212
Foreign exchange effect	80,644	10,589
Balance at end of the year	1,281,690	987,135
Accumulated impairment losses
Summary of changes in the Right-of-use assets
Balance at beginning of the year	(209,821)
Depreciation	(260,761)	(214,771)
Disposals	23,081	6,588
Foreign exchange effect	(18,878)	(1,638)
Balance at end of the year	(466,379)	(209,821)
Land and buildings | Gross
Summary of changes in the Right-of-use assets
Balance at beginning of the year	283,994	243,250
Additions	5,670	14,062
Disposals	(14,583)	(10,493)
Remeasurements	111	33,322
Foreign exchange effect	26,748	3,853
Balance at end of the year	301,940	283,994
Land and buildings | Accumulated impairment losses
Summary of changes in the Right-of-use assets
Balance at beginning of the year	(49,483)
Depreciation	(51,451)	(50,080)
Disposals	8,601	1,330
Foreign exchange effect	(5,286)	(733)
Balance at end of the year	(97,619)	(49,483)
Machines, equipment, and installations | Gross
Summary of changes in the Right-of-use assets
Balance at beginning of the year	533,286	436,401
Additions	185,116	117,653
Disposals	(14,846)	(22,993)
Remeasurements	(3,035)	(2,346)
Foreign exchange effect	37,809	4,571
Balance at end of the year	738,330	533,286
Machines, equipment, and installations | Accumulated impairment losses
Summary of changes in the Right-of-use assets
Balance at beginning of the year	(123,277)
Depreciation	(166,741)	(127,399)
Disposals	13,453	4,250
Foreign exchange effect	(8,091)	(128)
Balance at end of the year	(284,656)	(123,277)
Data electronic equipment | Gross
Summary of changes in the Right-of-use assets
Balance at beginning of the year	107,413	106,787
Additions	175	742
Disposals		(162)
Remeasurements	12,548
Foreign exchange effect	340	46
Balance at end of the year	120,476	107,413
Data electronic equipment | Accumulated impairment losses
Summary of changes in the Right-of-use assets
Balance at beginning of the year	(15,396)
Depreciation	(15,459)	(15,419)
Disposals		32
Foreign exchange effect	(70)	(9)
Balance at end of the year	(30,925)	(15,396)
Other | Gross
Summary of changes in the Right-of-use assets
Balance at beginning of the year	62,442	49,930
Additions	43,862	11,064
Disposals	(1,176)	(1,907)
Remeasurements	69	1,236
Foreign exchange effect	15,747	2,119
Balance at end of the year	120,944	62,442
Other | Accumulated impairment losses
Summary of changes in the Right-of-use assets
Balance at beginning of the year	(21,665)
Depreciation	(27,110)	(21,873)
Disposals	1,027	976
Foreign exchange effect	(5,431)	(768)
Balance at end of the year	R$ 53179	R$ 21665

LEASING - Leasing payable (Deta

LEASING - Leasing payable (Details) - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Leasing payable
Leasing payable	R$ 856474	R$ 804269
Current	231,703	202,536
Non-current	624,771	601,733
Financial expense for the year	R$ 61727	R$ 83620
Minimum
Leasing payable
Discount rate	3.70%	5.10%
Maximum
Leasing payable
Discount rate	10.80%	10.80%
2020
Leasing payable
Leasing payable		R$ 202536
2021
Leasing payable
Leasing payable	R$ 231703	172,870
2022
Leasing payable
Leasing payable	193,314	121,379
2023
Leasing payable
Leasing payable	140,019	85,878
2024
Leasing payable
Leasing payable	90,812	58,866
2025 on
Leasing payable
Leasing payable	R$ 200626	R$ 162740

TRADE ACCOUNTS PAYABLE (Details

TRADE ACCOUNTS PAYABLE (Details) - BRL (R$) R$ in Thousands	Dec. 31, 2020	Dec. 31, 2019
TRADE ACCOUNTS PAYABLE
Trade accounts payable	R$ 5437953	R$ 3762768
Domestic market
TRADE ACCOUNTS PAYABLE
Trade accounts payable	3,941,924	2,701,246
Debtor risk
TRADE ACCOUNTS PAYABLE
Trade accounts payable	726,045	376,093
Intercompany
TRADE ACCOUNTS PAYABLE
Trade accounts payable	8,958	4,283
Imports
TRADE ACCOUNTS PAYABLE
Trade accounts payable	R$ 761026	R$ 681146

SHORT-TERM DEBT AND LONG-TERM_3

SHORT-TERM DEBT AND LONG-TERM DEBT - Summary (Details) - BRL (R$) R$ in Thousands	Dec. 31, 2020	Dec. 31, 2019
LOANS AND FINANCING
Total Loans and Financing	R$ 14612934	R$ 13138823
Current	1,424,043	1,544,211
Non-current	R$ 13188891	11,594,612
Weighted average
LOANS AND FINANCING
Annual charges (as a percent)	5.34%
Working capital
LOANS AND FINANCING
Total Loans and Financing	R$ 1178557	107,312
Working capital | Weighted average
LOANS AND FINANCING
Annual charges (as a percent)	3.44%
Financing of property, plant and equipment and others
LOANS AND FINANCING
Total Loans and Financing	R$ 333797	843,099
Financing of property, plant and equipment and others | Weighted average
LOANS AND FINANCING
Annual charges (as a percent)	3.27%
Ten/Thirty Year Bonds
LOANS AND FINANCING
Total Loans and Financing	R$ 13100580	R$ 12188412
Ten/Thirty Year Bonds | Weighted average
LOANS AND FINANCING
Annual charges (as a percent)	5.41%

SHORT-TERM DEBT AND LONG-TERM_4

SHORT-TERM DEBT AND LONG-TERM DEBT - Principal and Interest (Details) - BRL (R$) R$ in Thousands	Dec. 31, 2020	Dec. 31, 2019
SHORT-TERM DEBT AND LONG-TERM DEBT
Principal amount of loans and Financing	R$ 14413188	R$ 12958565
Interest accrued of loans and Financing	199,746	180,258
Total Loans and Financing	R$ 14612934	R$ 13138823

SHORT-TERM DEBT AND LONG-TERM_5

SHORT-TERM DEBT AND LONG-TERM DEBT - By Currency (Details) - BRL (R$) R$ in Thousands	Dec. 31, 2020	Dec. 31, 2019
LOANS AND FINANCING
Total Loans and Financing	R$ 14612934	R$ 13138823
Brazilian Real (BRL)
LOANS AND FINANCING
Total Loans and Financing	1,245,988	111,492
U.S. Dollar (USD)
LOANS AND FINANCING
Total Loans and Financing	R$ 13366946	12,960,521
Other currencies
LOANS AND FINANCING
Total Loans and Financing		R$ 66810

SHORT-TERM DEBT AND LONG-TERM_6

SHORT-TERM DEBT AND LONG-TERM DEBT - Amortization schedules (Details) - BRL (R$) R$ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Amortization schedules of long-term loans and financing
Long-term debt	R$ 13188891	R$ 11594612
2021
Amortization schedules of long-term loans and financing
Long-term debt		1,221,361
2022
Amortization schedules of long-term loans and financing
Long-term debt	5,210	105,137
2023
Amortization schedules of long-term loans and financing
Long-term debt	2,108,324	1,243,774
2024
Amortization schedules of long-term loans and financing
Long-term debt	1,813,225	1,531,163
2025
Amortization schedules of long-term loans and financing
Long-term debt	682,422	1,642,664
2026 on
Amortization schedules of long-term loans and financing
Long-term debt	R$ 8579710	R$ 5850513

SHORT-TERM DEBT AND LONG-TERM_7

SHORT-TERM DEBT AND LONG-TERM DEBT - Additional disclosures (Details) R$ in Thousands, $ in Millions	Dec. 31, 2020USD ($)	Dec. 31, 2020BRL (R$)	Dec. 31, 2019BRL (R$)	Oct. 31, 2019BRL (R$)
LOANS AND FINANCING
Loans and financing		R$ 14612934	R$ 13138823
Working capital
LOANS AND FINANCING
Loans and financing		1,178,557	R$ 107312
Global Credit Line
LOANS AND FINANCING
Amount of outstanding balance credit facility	$ 40	207,000
Maximum borrowing capacity		4,157,000		R$ 800000
Bonds | Gerdau Acos Longos and Gerdau Acominas
LOANS AND FINANCING
Principal amount | $	$ 300
Amount outstanding		R$ 1175

DEBENTURES - Summary (Details)

DEBENTURES - Summary (Details) R$ in Thousands	12 Months Ended
	Dec. 31, 2020BRL (R$)instrument	Dec. 31, 2019BRL (R$)
DEBENTURES
Total Debentures	R$ 2902417	R$ 2911044
Current debentures	7,463	18,015
Non-current debentures	R$ 2894954	2,893,029
14th
DEBENTURES
Quantity Issued | instrument	20,000
Quantity Held in treasury | instrument	20,000
15th
DEBENTURES
Quantity Issued | instrument	1,500,000
Total Debentures	R$ 1500985	1,504,436
16th - A
DEBENTURES
Quantity Issued | instrument	600,000
Total Debentures	R$ 600759	602,847
16th - B
DEBENTURES
Quantity Issued | instrument	800,000
Total Debentures	R$ 800673	R$ 803761

DEBENTURES - Amortization sched

DEBENTURES - Amortization schedule (Details) - BRL (R$) R$ in Thousands	Dec. 31, 2020	Dec. 31, 2019
DEBENTURES
Non-current debentures	R$ 2894954	R$ 2893029
2022
DEBENTURES
Non-current debentures	1,497,760	1,496,591
2023
DEBENTURES
Non-current debentures	598,960	598,530
2027 on
DEBENTURES
Non-current debentures	R$ 798234	R$ 797908

DEBENTURES - Additional disclos

DEBENTURES - Additional disclosures (Details)	Dec. 31, 2020	Dec. 31, 2019
Debentures | CDI | Average
DEBENTURES
Interest rate (as a percent)	2.90%	6.18%

FINANCIAL INSTRUMENTS - Fair va

FINANCIAL INSTRUMENTS - Fair value of financial instruments (Details) - BRL (R$) R$ in Thousands	Dec. 31, 2020	Dec. 31, 2019
FINANCIAL INSTRUMENTS
Financial assets	R$ 4357884	R$ 4834178
Financial liabilities	19,838,551	18,184,601
Loans and Financing
FINANCIAL INSTRUMENTS
Financial liabilities	14,612,934	13,138,823
Financial liabilities, at fair value	17,014,948	14,288,142
Debentures
FINANCIAL INSTRUMENTS
Financial liabilities	2,902,417	2,911,044
Financial liabilities, at fair value	2,775,619	2,864,950
Related parties
FINANCIAL INSTRUMENTS
Financial liabilities	22,855
Financial liabilities, at fair value	22,855
Fair value of derivatives
FINANCIAL INSTRUMENTS
Financial liabilities	971
Financial liabilities, at fair value	971
Obligation with FIDC
FINANCIAL INSTRUMENTS
Financial liabilities	987,406	1,018,501
Financial liabilities, at fair value	987,406	1,018,501
Other current liabilities
FINANCIAL INSTRUMENTS
Financial liabilities	797,082	666,858
Financial liabilities, at fair value	797,082	666,858
Other non-current liabilities
FINANCIAL INSTRUMENTS
Financial liabilities	514,886	449,375
Financial liabilities, at fair value	514,886	449,375
Short-term investments
FINANCIAL INSTRUMENTS
Financial assets	3,041,143	3,652,949
Financial assets, at fair value	3,041,143	3,652,949
Related parties
FINANCIAL INSTRUMENTS
Financial assets	134,354	95,445
Financial assets, at fair value	134,354	95,445
Fair value of derivatives
FINANCIAL INSTRUMENTS
Financial assets		2,846
Financial assets, at fair value		2,846
Other current assets
FINANCIAL INSTRUMENTS
Financial assets	591,523	618,769
Financial assets, at fair value	591,523	618,769
Other non-current assets
FINANCIAL INSTRUMENTS
Financial assets	590,864	464,169
Financial assets, at fair value	R$ 590864	R$ 464169

FINANCIAL INSTRUMENTS - Exchang

FINANCIAL INSTRUMENTS - Exchange rate risk (Details) - Foreign currency risk - R$ / $	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
FINANCIAL INSTRUMENTS
Closing foreign exchange rate	5.1967	4.0307
Percentage of devaluation of Brazilian Real against the U.S. Dollar	22.44%

FINANCIAL INSTRUMENTS - Capital

FINANCIAL INSTRUMENTS - Capital management risk (Details) - Capital management risk R$ in Billions	12 Months Ended
	Dec. 31, 2020BRL (R$)
FINANCIAL INSTRUMENTS
Average maturity	6 years
Minimum
FINANCIAL INSTRUMENTS
Net debt/EBITDA	1
Maximum
FINANCIAL INSTRUMENTS
Net debt/EBITDA	1.5
Gross debt limit	R$ 12

FINANCIAL INSTRUMENTS - Liquidi

FINANCIAL INSTRUMENTS - Liquidity risk (Details) - Liquidity risk - BRL (R$) R$ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Disclosure of maturity analysis for financial liabilities held for managing liquidity risk
Contractual obligations	R$ 32800346	R$ 29416194
Less than 1 year
Disclosure of maturity analysis for financial liabilities held for managing liquidity risk
Contractual obligations	9,377,095	6,895,431
1-3 years
Disclosure of maturity analysis for financial liabilities held for managing liquidity risk
Contractual obligations	5,724,459	4,443,926
4-5 years
Disclosure of maturity analysis for financial liabilities held for managing liquidity risk
Contractual obligations	3,563,916	4,479,896
More than 5 years
Disclosure of maturity analysis for financial liabilities held for managing liquidity risk
Contractual obligations	14,134,876	13,596,941
Trade accounts payable
Disclosure of maturity analysis for financial liabilities held for managing liquidity risk
Contractual obligations	5,437,953	3,762,768
Trade accounts payable | Less than 1 year
Disclosure of maturity analysis for financial liabilities held for managing liquidity risk
Contractual obligations	5,437,953	3,762,768
Loans and Financing
Disclosure of maturity analysis for financial liabilities held for managing liquidity risk
Contractual obligations	21,962,204	20,061,659
Loans and Financing | Less than 1 year
Disclosure of maturity analysis for financial liabilities held for managing liquidity risk
Contractual obligations	2,131,402	2,312,877
Loans and Financing | 1-3 years
Disclosure of maturity analysis for financial liabilities held for managing liquidity risk
Contractual obligations	3,465,577	2,659,844
Loans and Financing | 4-5 years
Disclosure of maturity analysis for financial liabilities held for managing liquidity risk
Contractual obligations	3,531,312	3,793,164
Loans and Financing | More than 5 years
Disclosure of maturity analysis for financial liabilities held for managing liquidity risk
Contractual obligations	12,833,913	11,295,774
Debentures
Disclosure of maturity analysis for financial liabilities held for managing liquidity risk
Contractual obligations	3,077,960	3,457,033
Debentures | Less than 1 year
Disclosure of maturity analysis for financial liabilities held for managing liquidity risk
Contractual obligations	66,145	152,928
Debentures | 1-3 years
Disclosure of maturity analysis for financial liabilities held for managing liquidity risk
Contractual obligations	2,174,184	1,764,003
Debentures | 4-5 years
Disclosure of maturity analysis for financial liabilities held for managing liquidity risk
Contractual obligations	32,604	686,732
Debentures | More than 5 years
Disclosure of maturity analysis for financial liabilities held for managing liquidity risk
Contractual obligations	805,027	853,370
Related parties
Disclosure of maturity analysis for financial liabilities held for managing liquidity risk
Contractual obligations	22,855
Related parties | More than 5 years
Disclosure of maturity analysis for financial liabilities held for managing liquidity risk
Contractual obligations	22,855
Obligation with FIDC
Disclosure of maturity analysis for financial liabilities held for managing liquidity risk
Contractual obligations	987,406	1,018,501
Obligation with FIDC | Less than 1 year
Disclosure of maturity analysis for financial liabilities held for managing liquidity risk
Contractual obligations	944,513
Obligation with FIDC | 1-3 years
Disclosure of maturity analysis for financial liabilities held for managing liquidity risk
Contractual obligations	42,893
Obligation with FIDC | More than 5 years
Disclosure of maturity analysis for financial liabilities held for managing liquidity risk
Contractual obligations		1,018,501
Other current liabilities
Disclosure of maturity analysis for financial liabilities held for managing liquidity risk
Contractual obligations	797,082	666,858
Other current liabilities | Less than 1 year
Disclosure of maturity analysis for financial liabilities held for managing liquidity risk
Contractual obligations	797,082	666,858
Other non-current liabilities
Disclosure of maturity analysis for financial liabilities held for managing liquidity risk
Contractual obligations	514,886	449,375
Other non-current liabilities | 1-3 years
Disclosure of maturity analysis for financial liabilities held for managing liquidity risk
Contractual obligations	41,805	20,079
Other non-current liabilities | More than 5 years
Disclosure of maturity analysis for financial liabilities held for managing liquidity risk
Contractual obligations	R$ 473081	R$ 429296

FINANCIAL INSTRUMENTS - Sensiti

FINANCIAL INSTRUMENTS - Sensitivity analysis (Details) - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Foreign currency risk
Sensitivity analysis
Percentage of change	5.00%	5.00%
Impact on income statement based on change in assumption	R$ 15057	R$ 112355
Impact on income statement based on change in assumption, after effects of changes in net investment hedge	R$ 15047
Foreign currency risk | Non-Deliverable Forwards
Sensitivity analysis
Percentage of change	5.00%
Impact on income statement based on change in assumption	R$ 3703
Interest rate risk
Sensitivity analysis
Interest rate change (as a percent)	0.10%	0.10%
Impact on income statement based on change in assumption	R$ 85147	R$ 70891
Interest rate risk | Interest Rate Swap
Sensitivity analysis
Interest rate change (as a percent)	0.50%	0.50%
Impact on income statement based on change in assumption		R$ 408
Products sold price risk
Sensitivity analysis
Percentage of change	1.00%	1.00%
Impact on income statement based on change in assumption	R$ 438147	R$ 396440
Raw materials and commodity price risk
Sensitivity analysis
Percentage of change	1.00%	1.00%
Impact on income statement based on change in assumption	R$ 269454	R$ 258906

FINANCIAL INSTRUMENTS - Financi

FINANCIAL INSTRUMENTS - Financial instruments per category (Details) - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
FINANCIAL INSTRUMENTS
Financial assets	R$ 4357884	R$ 4834178
Financial liabilities	19,838,551	18,184,601
Financial income (expenses) from assets	597,027	372,602
Financial income (expenses) from liabilities	(2,295,734)	(1,881,816)
Loans and Financing
FINANCIAL INSTRUMENTS
Financial liabilities	14,612,934	13,138,823
Debentures
FINANCIAL INSTRUMENTS
Financial liabilities	2,902,417	2,911,044
Related parties
FINANCIAL INSTRUMENTS
Financial liabilities	22,855
Obligations with FIDC (current liabilities)
FINANCIAL INSTRUMENTS
Financial liabilities	944,513
Obligation with FIDC
FINANCIAL INSTRUMENTS
Financial liabilities	987,406	1,018,501
Other current liabilities
FINANCIAL INSTRUMENTS
Financial liabilities	797,082	666,858
Obligations with FIDC (non-current liabilities)
FINANCIAL INSTRUMENTS
Financial liabilities	42,893
Other non-current liabilities
FINANCIAL INSTRUMENTS
Financial liabilities	514,886	449,375
Fair value of derivatives
FINANCIAL INSTRUMENTS
Financial liabilities	971
Financial liability at fair value through profit or loss
FINANCIAL INSTRUMENTS
Financial liabilities	971
Financial income (expenses) from liabilities	(1,632)	(20,636)
Financial liability at fair value through profit or loss | Fair value of derivatives
FINANCIAL INSTRUMENTS
Financial liabilities	971
Financial liabilities at amortized cost
FINANCIAL INSTRUMENTS
Financial liabilities	19,837,580	18,184,601
Financial income (expenses) from liabilities	(2,294,102)	(1,861,180)
Financial liabilities at amortized cost | Loans and Financing
FINANCIAL INSTRUMENTS
Financial liabilities	14,612,934	13,138,823
Financial liabilities at amortized cost | Debentures
FINANCIAL INSTRUMENTS
Financial liabilities	2,902,417	2,911,044
Financial liabilities at amortized cost | Related parties
FINANCIAL INSTRUMENTS
Financial liabilities	22,855
Financial liabilities at amortized cost | Obligations with FIDC (current liabilities)
FINANCIAL INSTRUMENTS
Financial liabilities	944,513
Financial liabilities at amortized cost | Obligation with FIDC
FINANCIAL INSTRUMENTS
Financial liabilities		1,018,501
Financial liabilities at amortized cost | Other current liabilities
FINANCIAL INSTRUMENTS
Financial liabilities	797,082	666,858
Financial liabilities at amortized cost | Obligations with FIDC (non-current liabilities)
FINANCIAL INSTRUMENTS
Financial liabilities	42,893
Financial liabilities at amortized cost | Other non-current liabilities
FINANCIAL INSTRUMENTS
Financial liabilities	514,886	449,375
Short-term investments
FINANCIAL INSTRUMENTS
Financial assets	3,041,143	3,652,949
Fair value of derivatives
FINANCIAL INSTRUMENTS
Financial assets		2,846
Related parties
FINANCIAL INSTRUMENTS
Financial assets	134,354	95,445
Other current assets
FINANCIAL INSTRUMENTS
Financial assets	591,523	618,769
Other non-current assets
FINANCIAL INSTRUMENTS
Financial assets	590,864	464,169
Financial asset at amortised cost
FINANCIAL INSTRUMENTS
Financial assets	1,256,741	1,178,383
Financial income (expenses) from assets	487,631	279,843
Financial asset at amortised cost | Related parties
FINANCIAL INSTRUMENTS
Financial assets	134,354	95,445
Financial asset at amortised cost | Other current assets
FINANCIAL INSTRUMENTS
Financial assets	591,523	618,769
Financial asset at amortised cost | Other non-current assets
FINANCIAL INSTRUMENTS
Financial assets	530,864	464,169
Financial asset at fair value through profit or loss
FINANCIAL INSTRUMENTS
Financial assets	3,101,143	3,652,949
Financial income (expenses) from assets	109,396	92,759
Financial asset at fair value through profit or loss | Short-term investments
FINANCIAL INSTRUMENTS
Financial assets	3,041,143	3,652,949
Financial asset at fair value through profit or loss | Other non-current assets
FINANCIAL INSTRUMENTS
Financial assets	R$ 60000
Financial assets at fair value through other comprehensive income
FINANCIAL INSTRUMENTS
Financial assets		2,846
Financial assets at fair value through other comprehensive income | Fair value of derivatives
FINANCIAL INSTRUMENTS
Financial assets		R$ 2846

FINANCIAL INSTRUMENTS - Swap Co

FINANCIAL INSTRUMENTS - Swap Contracts (Details) R$ in Thousands, $ in Millions	12 Months Ended
	Dec. 31, 2020BRL (R$)USD ($)	Dec. 31, 2019BRL (R$)
Swap Contracts
Amount receivable		R$ 2846
Amount payable	R$ 971
Interest Rate Swap
Swap Contracts
Notional value | $	9.9
Interest Rate Swap | Maturity in 2020
Swap Contracts
Notional value		50,000
Amount receivable		R$ 2846
Interest Rate Swap | Maturity in 2020 | CDI
Swap Contracts
Percentage of basis used to calculate interest rate	111.50%	111.50%
Interest Rate Swap | Maturity in 2021
Swap Contracts
Amount payable	R$ 971

FINANCIAL INSTRUMENTS - Effecti

FINANCIAL INSTRUMENTS - Effectiveness testing for derivatives (Details) - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
FINANCIAL INSTRUMENTS
Current assets	R$ 0	R$ 2846
Total derivative assets		2,846
Current liabilities	971	0
Total derivative liabilities	971
Net Income
Gains on financial instruments	858	5,518
Losses on financial instruments	(1,632)	(20,636)
Total gains (losses) on financial instruments	(774)	(15,118)	R$ 32092
Other comprehensive income
(Losses) Gains on financial instruments	(1,972)	3,502	R$ 11947
Total (losses) gains on financial instruments	R$ 1972	R$ 3502

FINANCIAL INSTRUMENTS - Net inv

FINANCIAL INSTRUMENTS - Net investment hedge (Details) R$ in Thousands, $ in Billions	12 Months Ended
	Dec. 31, 2020USD ($)	Dec. 31, 2020BRL (R$)	Dec. 31, 2019BRL (R$)	Dec. 31, 2018BRL (R$)
Net investment hedge
Gain (loss) on net investment hedge, recognized in OCI		R$ 2504914	R$ 322948	R$ 1491534
Ten/Thirty Years Bonds
Net investment hedge
Gain (loss) on net investment hedge, recognized in income			R$ 322948000
Ten/Thirty Years Bonds | Hedges of net investment in foreign operations
Net investment hedge
Gain (loss) on net investment hedge, recognized in OCI | $	$ 2.1
Gain (loss) on net investment hedge, recognized in income		R$ 2504914000

FINANCIAL INSTRUMENTS - Measure

FINANCIAL INSTRUMENTS - Measurement of fair value (Details) - BRL (R$) R$ in Thousands	Dec. 31, 2020	Dec. 31, 2019
FINANCIAL INSTRUMENTS
Total financial assets	R$ 4357884	R$ 4834178
Total financial liabilities	19,838,551	18,184,601
Fair Value - Measured at Fair Value on a Recurring Basis
FINANCIAL INSTRUMENTS
Total financial assets	4,357,884	4,834,178
Total financial liabilities	19,838,551	18,184,601
Short-term debts | Fair Value - Measured at Fair Value on a Recurring Basis
FINANCIAL INSTRUMENTS
Current financial liabilities	1,424,043	1,544,211
Long-term debt | Fair Value - Measured at Fair Value on a Recurring Basis
FINANCIAL INSTRUMENTS
Non-current financial liabilities	13,188,891	11,594,612
Debentures
FINANCIAL INSTRUMENTS
Total financial liabilities	2,902,417	2,911,044
Debentures | Fair Value - Measured at Fair Value on a Recurring Basis
FINANCIAL INSTRUMENTS
Current financial liabilities	7,463	18,015
Non-current financial liabilities	2,894,954	2,893,029
Fair value of derivatives
FINANCIAL INSTRUMENTS
Total financial liabilities	971
Fair value of derivatives | Fair Value - Measured at Fair Value on a Recurring Basis
FINANCIAL INSTRUMENTS
Current financial liabilities	971
Related parties
FINANCIAL INSTRUMENTS
Total financial liabilities	22,855
Related parties | Fair Value - Measured at Fair Value on a Recurring Basis
FINANCIAL INSTRUMENTS
Non-current financial liabilities	22,855
Obligation with FIDC
FINANCIAL INSTRUMENTS
Total financial liabilities	987,406	1,018,501
Obligation with FIDC | Fair Value - Measured at Fair Value on a Recurring Basis
FINANCIAL INSTRUMENTS
Non-current financial liabilities	42,893	1,018,501
Lease liabilities
FINANCIAL INSTRUMENTS
Current financial liabilities	944,513
Other current liabilities
FINANCIAL INSTRUMENTS
Total financial liabilities	797,082	666,858
Other current liabilities | Fair Value - Measured at Fair Value on a Recurring Basis
FINANCIAL INSTRUMENTS
Current financial liabilities	797,082	666,858
Other non-current liabilities
FINANCIAL INSTRUMENTS
Total financial liabilities	514,886	449,375
Other non-current liabilities | Fair Value - Measured at Fair Value on a Recurring Basis
FINANCIAL INSTRUMENTS
Non-current financial liabilities	514,886	449,375
Short-term investments
FINANCIAL INSTRUMENTS
Total financial assets	3,041,143	3,652,949
Short-term investments | Fair Value - Measured at Fair Value on a Recurring Basis
FINANCIAL INSTRUMENTS
Current financial assets	3,041,143	3,652,949
Fair value of derivatives
FINANCIAL INSTRUMENTS
Total financial assets		2,846
Fair value of derivatives | Fair Value - Measured at Fair Value on a Recurring Basis
FINANCIAL INSTRUMENTS
Current financial assets		2,846
Related parties | Fair Value - Measured at Fair Value on a Recurring Basis
FINANCIAL INSTRUMENTS
Non-current financial assets	134,354	95,445
Other current assets
FINANCIAL INSTRUMENTS
Total financial assets	591,523	618,769
Other current assets | Fair Value - Measured at Fair Value on a Recurring Basis
FINANCIAL INSTRUMENTS
Current financial assets	591,523	618,769
Other non-current assets
FINANCIAL INSTRUMENTS
Total financial assets	590,864	464,169
Other non-current assets | Fair Value - Measured at Fair Value on a Recurring Basis
FINANCIAL INSTRUMENTS
Non-current financial assets	590,864	464,169
Quoted Prices in Non-Active Markets for Similar Assets (Level 2) | Fair Value - Measured at Fair Value on a Recurring Basis
FINANCIAL INSTRUMENTS
Total financial assets	4,357,884	4,834,178
Total financial liabilities	19,838,551	18,184,601
Quoted Prices in Non-Active Markets for Similar Assets (Level 2) | Short-term debts | Fair Value - Measured at Fair Value on a Recurring Basis
FINANCIAL INSTRUMENTS
Current financial liabilities	1,424,043	1,544,211
Quoted Prices in Non-Active Markets for Similar Assets (Level 2) | Long-term debt | Fair Value - Measured at Fair Value on a Recurring Basis
FINANCIAL INSTRUMENTS
Non-current financial liabilities	13,188,891	11,594,612
Quoted Prices in Non-Active Markets for Similar Assets (Level 2) | Debentures | Fair Value - Measured at Fair Value on a Recurring Basis
FINANCIAL INSTRUMENTS
Current financial liabilities	7,463	18,015
Non-current financial liabilities	2,894,954	2,893,029
Quoted Prices in Non-Active Markets for Similar Assets (Level 2) | Fair value of derivatives | Fair Value - Measured at Fair Value on a Recurring Basis
FINANCIAL INSTRUMENTS
Current financial liabilities	971
Quoted Prices in Non-Active Markets for Similar Assets (Level 2) | Related parties | Fair Value - Measured at Fair Value on a Recurring Basis
FINANCIAL INSTRUMENTS
Non-current financial liabilities	22,855
Quoted Prices in Non-Active Markets for Similar Assets (Level 2) | Obligation with FIDC | Fair Value - Measured at Fair Value on a Recurring Basis
FINANCIAL INSTRUMENTS
Non-current financial liabilities	42,893	1,018,501
Quoted Prices in Non-Active Markets for Similar Assets (Level 2) | Lease liabilities
FINANCIAL INSTRUMENTS
Current financial liabilities	944,513
Quoted Prices in Non-Active Markets for Similar Assets (Level 2) | Other current liabilities | Fair Value - Measured at Fair Value on a Recurring Basis
FINANCIAL INSTRUMENTS
Current financial liabilities	797,082	666,858
Quoted Prices in Non-Active Markets for Similar Assets (Level 2) | Other non-current liabilities | Fair Value - Measured at Fair Value on a Recurring Basis
FINANCIAL INSTRUMENTS
Non-current financial liabilities	514,886	449,375
Quoted Prices in Non-Active Markets for Similar Assets (Level 2) | Short-term investments | Fair Value - Measured at Fair Value on a Recurring Basis
FINANCIAL INSTRUMENTS
Current financial assets	3,041,143	3,652,949
Quoted Prices in Non-Active Markets for Similar Assets (Level 2) | Fair value of derivatives | Fair Value - Measured at Fair Value on a Recurring Basis
FINANCIAL INSTRUMENTS
Current financial assets		2,846
Quoted Prices in Non-Active Markets for Similar Assets (Level 2) | Related parties | Fair Value - Measured at Fair Value on a Recurring Basis
FINANCIAL INSTRUMENTS
Non-current financial assets	134,354	95,445
Quoted Prices in Non-Active Markets for Similar Assets (Level 2) | Other current assets | Fair Value - Measured at Fair Value on a Recurring Basis
FINANCIAL INSTRUMENTS
Current financial assets	591,523	618,769
Quoted Prices in Non-Active Markets for Similar Assets (Level 2) | Other non-current assets | Fair Value - Measured at Fair Value on a Recurring Basis
FINANCIAL INSTRUMENTS
Non-current financial assets	R$ 590864	R$ 464169

FINANCIAL INSTRUMENTS - Changes

FINANCIAL INSTRUMENTS - Changes in liabilities from Cash Flow from financing activities (Details) - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Related parties, net
Changes in liabilities from Cash flow from financing activities
Beginning of year	R$ 95445	R$ 26589	R$ 51839
Cash transactions
Proceeds/(Repayment) from financing activities	(7,777)	(64,089)	25,755
Non cash transactions
Interest expense on loans and Interest on loans with related parties	(8,277)	(4,767)	(545)
Exchange Variation, Operations with Subsidiaries and Associate Company and Others			40
End of year	(111,499)	(95,445)	(26,589)
Leasing payable
Changes in liabilities from Cash flow from financing activities
Beginning of year	804,269	836,368
Cash transactions
Proceeds/(Repayment) from financing activities	(247,914)	(161,824)
Interest paid on loans and financing	(61,727)	(83,620)
Non cash transactions
Interest expense on loans and Interest on loans with related parties	61,727	83,620
Exchange variation and others	300,119	129,725
End of year	856,474	804,269	836,368
Debt, Debentures and Losses/Gains on financial instruments, net - Derivative instruments
Changes in liabilities from Cash flow from financing activities
Beginning of year	16,047,021	14,878,542	16,510,851
Cash transactions
Proceeds/(Repayment) from financing activities	(1,963,283)	700,490	(3,439,644)
Interest paid on loans and financing	(1,079,981)	(945,027)	(1,162,364)
Non cash transactions
Interest expense on loans and Interest on loans with related parties	1,022,460	938,120	1,177,686
Exchange variation and others	3,490,105	474,896
Exchange Variation, Operations with Subsidiaries and Associate Company and Others			1,792,013
End of year	R$ 17516322	R$ 16047021	R$ 14878542

TAXES PAYABLE (Details)

TAXES PAYABLE (Details) - BRL (R$) R$ in Thousands	Dec. 31, 2020	Dec. 31, 2019
TAXES PAYABLE
Payroll charges	R$ 100301	R$ 75385
ICMS (state VAT)	99,430	47,244
COFINS (tax on revenue)	51,444	6,654
IPI (federal VAT)	38,153	13,252
IVA (value-added tax) and others	310,761	290,453
Taxes payable	R$ 600089	R$ 432988

TAX, CIVIL AND LABOR CLAIMS A_3

TAX, CIVIL AND LABOR CLAIMS AND CONTINGENT ASSETS - Provisions (Details) - BRL (R$) R$ in Thousands	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Other provisions disclosures
Provision for tax, civil and labor liabilities	R$ 1172511	R$ 809299
Legal proceedings provision
Other provisions disclosures
Provision for tax, civil and labor liabilities	1,172,511	809,299	R$ 770305	R$ 827883
Tax Provisions
Other provisions disclosures
Provision for tax, civil and labor liabilities	706,104	396,821
Labor provisions
Other provisions disclosures
Provision for tax, civil and labor liabilities	428,821	357,130
Civil provisions
Other provisions disclosures
Provision for tax, civil and labor liabilities	R$ 37586	R$ 55348

TAX, CIVIL AND LABOR CLAIMS A_4

TAX, CIVIL AND LABOR CLAIMS AND CONTINGENT ASSETS - Changes in Provisions (Details) - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Changes in the tax, labor and civil provisions :
Balance at the beginning of the year	R$ 809299
Balance at the end of the year	1,172,511	R$ 809299
Legal proceedings provision
Changes in the tax, labor and civil provisions :
Balance at the beginning of the year	809,299	770,305	R$ 827883
Additions	559,513	249,868	177,684
Monetary correction	104,473	70,788	85,626
Reversal of contingent liabilities, net	929,711
Reversal of monetary update of contingent liabilities	(369,819)
Reversal of accrued amounts	(304,678)	(282,239)	(319,719)
Foreign exchange effect on provisions in foreign currency	3,904	577	(1,169)
Balance at the end of the year	R$ 1172511	R$ 809299	R$ 770305

TAX, CIVIL AND LABOR CLAIMS A_5

TAX, CIVIL AND LABOR CLAIMS AND CONTINGENT ASSETS - Tax contingencies (Details) - Tax contingencies - BRL (R$) R$ in Thousands

Dec. 31, 2020

Dec. 30, 2020

Dec. 17, 2020

Dec. 15, 2020

Dec. 07, 2020

Dec. 01, 2020

Nov. 17, 2020

Nov. 03, 2020

Oct. 15, 2020

Sep. 29, 2020

Jul. 07, 2020

Jul. 01, 2020

Jun. 23, 2020

Mar. 02, 2020

Dec. 27, 2019

Dec. 05, 2019

May 17, 2019

Apr. 29, 2019

IPI credit on inputs | Pending

Contingencies

Estimated financial effect of contingent liabilities

R$ 357974

Non-approval of compensation of credits on inputs | Pending

Contingencies

Estimated financial effect of contingent liabilities

1,016,764

Social security contributions | Pending

Contingencies

Estimated financial effect of contingent liabilities

138,369

Other Taxes | Pending

Contingencies

Estimated financial effect of contingent liabilities

614,647

Withholding Income Tax | Special Appeal, Filed

Contingencies

Estimated financial effect of contingent liabilities

R$ 197082

R$ 158723

Goodwill Deductibility | Pending

Contingencies

Estimated financial effect of contingent liabilities

436,443

R$ 143799

Goodwill Deductibility | Special Appeal, Filed

Contingencies

Estimated financial effect of contingent liabilities

24,375

Goodwill Deductibility | Voluntary Appeal, Pending

Contingencies

Estimated financial effect of contingent liabilities

198,703

Goodwill Deductibility | Voluntary Appeal, Filed

Contingencies

Estimated financial effect of contingent liabilities

69,566

Gerdau Acominas S.A., Gerdau Acos Longos S.A., and Gerdau Acos Especiais S.A. | Goodwill Deductibility | Administrative collection

Contingencies

Estimated financial effect of contingent liabilities

7,984,187

Gerdau Acos Longos S.A. and Gerdau Acominas S.A. | ICMS (State Value Added Tax) | Pending

Contingencies

Estimated financial effect of contingent liabilities

458,801

Gerdau Acos Longos S.A. and Gerdau Acominas S.A. | Goodwill Deductibility | Voluntary Appeal, Filed

Contingencies

Estimated financial effect of contingent liabilities

5,371,636

Gerdau Acos Longos S.A. | Withholding Income Tax

Contingencies

Estimated financial effect of contingent liabilities

1,256,016

Gerdau Acos Longos S.A. | Withholding Income Tax | Pending

Contingencies

Estimated financial effect of contingent liabilities

R$ 57659

R$ 192245

Gerdau Acos Longos S.A. | Withholding Income Tax | Special Appeal, Filed

Contingencies

Estimated financial effect of contingent liabilities

R$ 140076

R$ 137743

R$ 130047

Gerdau Acos Longos S.A. | Withholding Income Tax | Voluntary Appeal, Filed

Contingencies

Estimated financial effect of contingent liabilities

R$ 242441

Gerdau Acos Longos S.A. | Goodwill Deductibility | Embargo to Enforcement, Filed

Contingencies

Estimated financial effect of contingent liabilities

R$ 141444

Gerdau Acos Longos S.A. | Goodwill Deductibility | Motion for clarification filed

Contingencies

Estimated financial effect of contingent liabilities

R$ 295064

Gerdau Acos Longos S.A. | Goodwill Deductibility | Notice of judgment received

Contingencies

Estimated financial effect of contingent liabilities

R$ 317710

Gerdau Acos Longos S.A. | Goodwill Deductibility | Pending

Contingencies

Estimated financial effect of contingent liabilities

557,927

R$ 67904

Gerdau Acos Longos S.A. | Goodwill Deductibility | Special Appeal, Filed

Contingencies

Estimated financial effect of contingent liabilities

4,289

R$ 499483

Gerdau Acos Longos S.A. | Goodwill Deductibility | Voluntary Appeal, Filed

Contingencies

Estimated financial effect of contingent liabilities

486,175

Gerdau Internacional Empreendimentos Ltda. and Gerdau Acos Especiais S.A | IRPJ - Corporate Income Tax and CSLL - Social Contribution Tax [Member] | Pending

Contingencies

Estimated financial effect of contingent liabilities

1,286,160

Gerdau Internacional Empreendimentos Ltda | IRPJ - Corporate Income Tax and CSLL - Social Contribution Tax [Member] | Embargo to Enforcement, Filed

Contingencies

Estimated financial effect of contingent liabilities

R$ 168184

Gerdau Internacional Empreendimentos Ltda | Tax Foreclosure | Voluntary Appeal, Filed

Contingencies

Estimated financial effect of contingent liabilities

859,699

Gerdau Internacional Empreendimentos Ltda | Corporate Income Tax and Social Contribution Tax | Notice of judgment received

Contingencies

Remaining tax contingency liability from a notice

R$ 35886

Gerdau Internacional Empreendimentos Ltda | Corporate Income Tax and Social Contribution Tax | Pending

Contingencies

Estimated financial effect of contingent liabilities

1,068,796

Gerdau Acos Especiais S.A. | Goodwill Deductibility | Special Appeal, Filed

Contingencies

Estimated financial effect of contingent liabilities

107,190

Gerdau Acos Especiais S.A. | Goodwill Deductibility | Special appeal, pending

Contingencies

Estimated financial effect of contingent liabilities

R$ 135365

Gerdau Acos Especiais S.A. | Corporate Income Tax and Social Contribution Tax | Embargo to Execution, Filed

Contingencies

Estimated financial effect of contingent liabilities

R$ 222391

TAX, CIVIL AND LABOR CLAIMS A_6

TAX, CIVIL AND LABOR CLAIMS AND CONTINGENT ASSETS - Civil Contingencies, Labor Contingencies and Administrative proceedings (Details) R$ in Thousands	Aug. 01, 2013BRL (R$)	Sep. 23, 2005BRL (R$)item	Dec. 31, 2019item	Dec. 31, 2020BRL (R$)
Civil contingencies | Antitrust Legislation
Contingencies
Number of civil construction unions | item		2
Fine for existence of cartel on gross revenues (in percentage)		7.00%
Fine for existence of cartel		R$ 245070
Fine for existence of cartel updated by judicial accounting	R$ 417820
Number of lawsuits that challenged the investigation | item			2
Civil contingencies | Other Demands Of a Civil Nature
Contingencies
Estimated financial effect of contingent liabilities				R$ 316054
Labor Contingencies
Contingencies
Estimated financial effect of contingent liabilities				R$ 153459

TAX, CIVIL AND LABOR CLAIMS A_7

TAX, CIVIL AND LABOR CLAIMS AND CONTINGENT ASSETS - Judicial Deposits (Details) - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Jan. 07, 2021	Nov. 18, 2020	Jun. 29, 2020	May 27, 2020	Apr. 13, 2020	Dec. 31, 2019	Dec. 18, 2019	Sep. 16, 2019	Jul. 19, 2019
Disclosure of other provisions [line items]
Tax	R$ 1597995						R$ 1837967
Labor	95,234						113,379
Civil	132,562						40,369
Judicial deposits	1,825,791						R$ 1991715
Balance judicial deposits	1,504,582
Amount of deposits for which replacement has been requested						R$ 1700000
Final and unappealable decision, first lawsuit
Disclosure of other provisions [line items]
Amount of undue payments before proposed action										R$ 122000
Amount of undue payments before proposed action, net of related expenses										R$ 79000
Right to withdraw judicial deposits									R$ 179000
Procedure to collect differences, amount		R$ 100000
Final and unappealable decision, second lawsuit
Disclosure of other provisions [line items]
Amount of undue payments before proposed action								R$ 280000
Amount of undue payments before proposed action, net of related expenses								R$ 185000
Right to withdraw judicial deposits					R$ 189000
Final and unappealable decision, third lawsuit
Disclosure of other provisions [line items]
Amount of undue payments before proposed action				R$ 147000
Amount of undue payments before proposed action, net of related expenses				135,000
Right to withdraw judicial deposits				R$ 193000
Final and unappealable decision, fourth lawsuit
Disclosure of other provisions [line items]
Amount of undue payments before proposed action			R$ 940000
Amount of undue payments before proposed action, net of related expenses			902,000
Right to withdraw judicial deposits			R$ 3000
Lawsuits for the repetition of undue payments awaiting unappealable decision
Disclosure of other provisions [line items]
Amount of undue payments before proposed action	773,000
Judicial deposits raised	1,300,000
Legal proceedings provision
Disclosure of other provisions [line items]
Reversal of provision for tax liabilities, net	929,711
Reversal of interest on provision for tax liabilities, net	R$ 369819

TAX, CIVIL AND LABOR CLAIMS A_8

TAX, CIVIL AND LABOR CLAIMS AND CONTINGENT ASSETS - Contingent Assets (Details) R$ in Millions	Dec. 30, 2020BRL (R$)	Dec. 22, 2020BRL (R$)	Jul. 03, 2020BRL (R$)	Jun. 30, 2020BRL (R$)	Dec. 31, 2020BRL (R$)kW
TAX, CIVIL AND LABOR CLAIMS AND CONTINGENT ASSETS
Minimum industrial consumers monthly electricity consumption limit (in Kilo watt hour) | kW					2,000
Maximum period to return the compulsory loan to taxpayers					20 years
Claims receivable from monetary correction of principal, interest, moratory and others due to compulsory loans					R$ 113.0
Gain on settlement of litigation, net of expenses incurred				R$ 436.0
Amounts raised	R$ 43.6	R$ 39.7	R$ 206.0
Amount of other pending lawsuits					R$ 1350.0

RELATED-PARTY TRANSACTIONS - In

RELATED-PARTY TRANSACTIONS - Intercompany loans (Details) - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
RELATED PARTY TRANSACTIONS
Assets	R$ 134354	R$ 95445
Liabilities	(22,855)	0
Net financial income	8,277	4,767	R$ 545
Fundacao Gerdau
RELATED PARTY TRANSACTIONS
Assets	17,262	21,838
Gerdau Corsa S.A.P.I de C.V.
RELATED PARTY TRANSACTIONS
Assets	117,092	R$ 73607
Bradley Steel Processors
RELATED PARTY TRANSACTIONS
Liabilities	R$ 22855

RELATED-PARTY TRANSACTIONS - Op

RELATED-PARTY TRANSACTIONS - Operations with related parties (Details) R$ in Thousands	12 Months Ended
	Dec. 31, 2020BRL (R$)installment	Dec. 31, 2019BRL (R$)	Dec. 31, 2018BRL (R$)
Associate companies and joint ventures
RELATED PARTY TRANSACTIONS
Sales to related parties	R$ 887945	R$ 1572618	R$ 1382584
Purchases from related parties	208,948	198,636	129,513
Sales to related parties, net of purchases	678,997	1,373,982	1,253,071
Controlling shareholders
RELATED PARTY TRANSACTIONS
Sale of property to related party	R$ 21204
Number of annual installments | installment	6
Annual installment amount	R$ 3534
Accounts receivable from sale of property to related party	17,670
Rental income from related party	R$ 524	R$ 554	R$ 445
Guarantee fee percentage	0.95%	0.95%	0.95%
Expenses resulting from debenture guarantees		R$ 68	R$ 194

RELATED-PARTY TRANSACTIONS - Gu

RELATED-PARTY TRANSACTIONS - Guarantees granted (Details) - Joint-venture - Financial guarantees - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Gerdau Corsa S.A.P.I de C.V.
Guarantees granted
Original Amount	R$ 1750249
Carrying Amount	2,242,865	R$ 1784868	R$ 1933929
Gerdau Summit Acos Fundidos e Forjados S.A.
Guarantees granted
Original Amount	130,164
Carrying Amount	30,125	37,285	41,571
Gerdau Metaldom S.A; Aceros Corsa S.A De C.V
Guarantees granted
Original Amount	R$ 274560
Carrying Amount		R$ 241842	R$ 198619

RELATED-PARTY TRANSACTIONS - Ke

RELATED-PARTY TRANSACTIONS - Key Management compensation and other information from related parties (Details) R$ in Thousands	12 Months Ended
	Dec. 31, 2020BRL (R$)EquityInstruments	Dec. 31, 2019BRL (R$)EquityInstruments	Dec. 31, 2018EquityInstruments
Key Management
RELATED PARTY TRANSACTIONS
Salaries, variable compensation and benefits | R$	R$ 41165	R$ 32359
Contributions to defined contribution pension plans | R$	1,416	1,687
Cost of long-term incentive plan | R$	39,766	26,631
Fundacao Gerdau, Instituto Gerdau and Fundacao Ouro Branco
RELATED PARTY TRANSACTIONS
Contributions to defined contribution pension plans | R$	R$ 104322	R$ 96191
Restricted and Performance Shares | Key Management
Restricted shares granted to Management
Balance, beginning of year	6,717,872	6,717,872	6,375,547
Granted	733,218	1,083,116
Exercised	(937,325)	(627,076)
Cancelled	(64,112)	(38,553)
Others	(6,595)	75,163
Balance, end of year	6,456,248	6,717,872	6,717,872

EMPLOYEE BENEFITS - Summary (De

EMPLOYEE BENEFITS - Summary (Details) - BRL (R$) R$ in Thousands	Dec. 31, 2020	Dec. 31, 2019
EMPLOYEE BENEFITS
Plan assets	R$ 39196	R$ 45381
Total liabilities	1,861,439	1,470,444
Current	208	495
Non-current	1,861,231	1,469,949
Defined contribution pension plan
EMPLOYEE BENEFITS
Plan assets	39,196	45,381
Defined benefit pension plan
EMPLOYEE BENEFITS
Total liabilities	1,441,592	1,138,592
Post-employment health care benefit
EMPLOYEE BENEFITS
Total liabilities	362,944	298,989
Retirement and termination benefits
EMPLOYEE BENEFITS
Total liabilities	R$ 56903	R$ 32863

EMPLOYEE BENEFITS - Post-employ

EMPLOYEE BENEFITS - Post-employment defined benefit pension plan (Details) - BRL (R$) R$ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Post-employment defined benefit pension plans
EMPLOYEE BENEFITS
Accumulated other comprehensive income	R$ 1173010	R$ 1120938
North-American defined benefit plans | Discount rate
EMPLOYEE BENEFITS
Increase in actuarial assumption (as a percent)	1.00%
Decrease in actuarial assumption (as a percent)	1.00%
Increase (decrease) in defined benefit obligation due to increase in actuarial assumption	R$ 17965
Increase (decrease) in defined benefit obligation due to decrease in actuarial assumption	R$ 12482

EMPLOYEE BENEFITS - Defined ben

EMPLOYEE BENEFITS - Defined benefit pension plan - Current expenses (Details) - Defined benefit pension plan - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Current expenses of the defined benefit pension plans
Cost of current service	R$ 69323	R$ 54518	R$ 60803
Interest expense	191,326	189,544	82,513
Return on plan assets	(156,475)	(163,148)	(59,692)
Past service cost	3,967	2,302	7,065
Settlement	(11,609)	(4,712)	3,220
Interest cost on unrecoverable surplus	7,413	16,247	20,023
Net pension cost (benefit)	R$ 103945	R$ 94751	R$ 113932

EMPLOYEE BENEFITS - Defined b_2

EMPLOYEE BENEFITS - Defined benefit pension plan - Reconciliation of plan assets and liabilities (Details) - Defined benefit pension plan - BRL (R$) R$ in Thousands	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Reconciliations of assets and liabilities of the plans
Net	R$ 1441592	R$ 1138591
Defined benefit obligation	(1,441,592)	(1,138,591)
Present value of the defined benefit obligations
Reconciliations of assets and liabilities of the plans
Net	(5,921,285)	(4,601,965)	R$ 4391251	R$ 4314592
Plan assets
Reconciliations of assets and liabilities of the plans
Net	4,652,000	3,656,891	R$ 3568934	R$ 3456613
Asset ceiling restrictions on recognition of net funded assets
Reconciliations of assets and liabilities of the plans
Net	R$ 172307	R$ 193517

EMPLOYEE BENEFITS - Defined b_3

EMPLOYEE BENEFITS - Defined benefit pension plan - Variation of the plan obligations (Details) - Defined benefit pension plan - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
EMPLOYEE BENEFITS
Obligation at the beginning of the year	R$ 1138591
Cost of service	69,323	R$ 54518	R$ 60803
Interest expense	191,326	189,544	82,513
Past service cost	3,967	2,302	7,065
Obligation at the end of the year	1,441,592	1,138,591
Present value of the defined benefit obligations
EMPLOYEE BENEFITS
Obligation at the beginning of the year	4,601,965	4,391,251	4,314,592
Cost of service	69,323	54,518	60,803
Interest expense	191,326	189,544	188,729
Payment of benefits	(434,650)	(309,817)	(318,198)
Past service cost	3,967	2,302	7,065
Supplementary amounts of the plan			17,078
Settlement	(190,948)	(498,493)	(61,369)
Gain (loss) on remeasurement	467,106	546,911	(370,083)
Exchange Variance	1,213,196	225,749	552,634
Obligation at the end of the year	R$ 5921285	R$ 4601965	R$ 4391251

EMPLOYEE BENEFITS - Defined b_4

EMPLOYEE BENEFITS - Defined benefit pension plan - Variation of the plan assets (Details) - Defined benefit pension plan - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
EMPLOYEE BENEFITS
Fair value of the plan assets at the beginning of the year	R$ 1138591
Return of the plan assets	156,475	R$ 163148	R$ 59692
Fair value of plan assets at the end of the year	(1,441,592)	(1,138,591)
Plan assets
EMPLOYEE BENEFITS
Fair value of the plan assets at the beginning of the year	3,656,891	3,568,934	3,456,613
Return of the plan assets	156,475	163,148	165,908
Contributions from sponsors	224,979	162,650	197,828
Settlement	(179,339)	(493,781)	(64,868)
Payment of benefits	(434,650)	(309,817)	(318,198)
Remeasurement	334,675	386,767	(253,301)
Exchange Variance	892,969	178,990	384,952
Fair value of plan assets at the end of the year	4,652,000	3,656,891	R$ 3568934
Value of shares included in fair value of plan assets	R$ 8745	R$ 10221

EMPLOYEE BENEFITS - Defined b_5

EMPLOYEE BENEFITS - Defined benefit pension plan - Actuarial gains and losses (Details) - Defined benefit pension plan - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Amounts recognized as actuarial gains and losses in the statement of comprehensive income
Restriction recognized in Other Comprehensive Income	R$ 42317	R$ 94198	R$ 43197
Remeasurements recognized in Other Comprehensive Income	90,114	65,946	(159,979)
Plan assets
Amounts recognized as actuarial gains and losses in the statement of comprehensive income
Gain (loss) on remeasurement	(334,675)	(386,767)	253,301
Present value of the defined benefit obligations
Amounts recognized as actuarial gains and losses in the statement of comprehensive income
Gain (loss) on remeasurement	R$ 467106	R$ 546911	R$ 370083

EMPLOYEE BENEFITS - Defined b_6

EMPLOYEE BENEFITS - Defined benefit pension plan - Historical actuarial remeasurements (Details) - Defined benefit pension plan - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Historical actuarial remeasurements
Present value of defined benefit obligation	R$ 5921285	R$ 4601965	R$ 4391251	R$ 4314592	R$ 4174653
Fair value of plan assets	4,652,000	3,656,891	3,568,934	3,456,613	3,292,890
Surplus (Deficit)	(1,269,285)	(945,074)	(822,317)	(857,979)	(881,763)
Present value of the defined benefit obligations
Historical actuarial remeasurements
Experience adjustments on plan liabilities	467,106	546,911	(370,083)	235,549	186,905
Plan assets
Historical actuarial remeasurements
Experience adjustments on plan assets	R$ 334675	R$ 386767	R$ 253301	R$ 232214	R$ 109153

EMPLOYEE BENEFITS - Defined b_7

EMPLOYEE BENEFITS - Defined benefit pension plan - Allocation of plan assets (Details)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Brazil
Allocation for plan assets
Fixed income	99.10%	98.00%
Others	0.90%	2.00%
Total	100.00%	100.00%
North America
Allocation for plan assets
Fixed income	46.60%	54.90%
Variable income	47.10%	42.20%
Others	6.30%	2.90%
Total	100.00%	100.00%
Defined benefit pension plan
Allocation for plan assets
Target allocation of shares (as a percent)	50.00%
Target allocation of debt securities (as a percent)	40.00%
Target allocation of alternative securities (as a percent)	10.00%

EMPLOYEE BENEFITS - Defined b_8

EMPLOYEE BENEFITS - Defined benefit pension plan - Assumptions used to calculate defined benefit plans (Details) - Defined benefit pension plan	Dec. 31, 2020	Dec. 31, 2019
Brazil
Summary of assumptions used to calculate the defined benefit plans
Average discount rate	6.56%	7.16%
North America
Summary of assumptions used to calculate the defined benefit plans
Rate of increase in compensation	3.00%	3.00%
North America | Minimum
Summary of assumptions used to calculate the defined benefit plans
Average discount rate	2.25%	3.00%
North America | Maximum
Summary of assumptions used to calculate the defined benefit plans
Average discount rate	2.50%	3.25%

EMPLOYEE BENEFITS - Post-empl_2

EMPLOYEE BENEFITS - Post-employment defined contribution pension plan (Details) - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Defined contribution pension plan
EMPLOYEE BENEFITS
Total cost	R$ 133963	R$ 118283

EMPLOYEE BENEFITS - Post-empl_3

EMPLOYEE BENEFITS - Post-employment health care benefit plan - Net periodic costs (Details) - Post-employment health care benefit - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Net periodic costs of post-employment health care benefits
Cost of current service	R$ 4964	R$ 3302	R$ 4144
Interests expense	11,311	10,656	11,082
Past service cost	(660)	(2,717)	(40,740)
Net pension cost (benefit)	R$ 15615	R$ 11241	R$ 25514

EMPLOYEE BENEFITS - Post-empl_4

EMPLOYEE BENEFITS - Post-employment health care benefit plan - Funded status (Details) - Post-employment health care benefit - BRL (R$) R$ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Funded status of the post-employment health benefits plans
Total net liabilities	R$ 362944	R$ 298989
Present value of the defined benefit obligations
Funded status of the post-employment health benefits plans
Total net liabilities	R$ 362944	R$ 298989

EMPLOYEE BENEFITS - Post-empl_5

EMPLOYEE BENEFITS - Post-employment health care benefit plan - Change in obligation (Details) - Post-employment health care benefit - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
EMPLOYEE BENEFITS
Cost of service	R$ 4964	R$ 3302	R$ 4144
Interest expense	11,311	10,656	11,082
Present value of the defined benefit obligations
EMPLOYEE BENEFITS
Obligation at the beginning of the year	298,989	272,959	316,364
Cost of service	4,964	3,302	4,144
Interest expense	11,311	10,656	11,082
Past service cost	(660)	(2,717)	(40,740)
Contributions from participants	2,349	2,088	1,496
Payment of benefits	(20,870)	(15,331)	(18,655)
Gain (loss) on remeasurement	(23,533)	11,202	(40,841)
Exchange variations	90,394	16,830	40,109
Obligation at the end of the year	R$ 362944	R$ 298989	R$ 272959

EMPLOYEE BENEFITS - Post-empl_6

EMPLOYEE BENEFITS - Post-employment health care benefit plan - Change in plan assets (Details) - Post-employment health care benefit - Plan assets - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
EMPLOYEE BENEFITS
Fair value of the plan assets at the beginning of the year	R$ 0	R$ 0
Contributions from sponsors	19,150	13,243	R$ 17159
Contributions from participants	2,349	2,088	1,496
Payment of benefits	(21,499)	(15,331)	(18,655)
Fair value of plan assets at the end of the year	R$ 0	R$ 0	R$ 0

EMPLOYEE BENEFITS - Post-empl_7

EMPLOYEE BENEFITS - Post-employment health care benefit plan - Gains and losses (Details) - Post-employment health care benefit - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Historical actuarial remeasurements
Present value of defined benefit obligation	R$ 362944	R$ 298989	R$ 272959	R$ 316364	R$ 305447
Surplus (Deficit)	(362,944)	(298,989)	(272,959)	(316,364)	(305,447)
Experience adjustments on plan liabilities	(23,533)	11,202	(40,841)	R$ 14452	R$ 3673
Amounts recognized as actuarial gains and losses in the statement of comprehensive income
Losses on actuarial obligation	(23,533)	11,202	(40,841)
Pension Plan
Amounts recognized as actuarial gains and losses in the statement of comprehensive income
Actuarial losses recognized in Equity	R$ 23533	R$ 11202	R$ 40841

EMPLOYEE BENEFITS - Post-empl_8

EMPLOYEE BENEFITS - Post-employment health care benefit plan - Assumptions (Details) - Post-employment health care benefit	Dec. 31, 2020	Dec. 31, 2019
Minimum
Summary of assumptions used to calculate the defined benefit plans
Average discount rate	2.25%	3.00%
Health treatment - rate assumed next year	6.10%	5.80%
Health treatment - Assumed rate of decline in the cost to achieve in the years of 2028 to 2041	4.00%	4.00%
Maximum
Summary of assumptions used to calculate the defined benefit plans
Average discount rate	2.50%	3.25%
Health treatment - rate assumed next year	6.50%	6.70%
Health treatment - Assumed rate of decline in the cost to achieve in the years of 2028 to 2041	4.40%	4.40%

EMPLOYEE BENEFITS - Post-empl_9

EMPLOYEE BENEFITS - Post-employment health care benefit plan - Sensitivity Analysis (Details) - Post-employment health care benefit - Discount rate R$ in Thousands	Dec. 31, 2020BRL (R$)
Sensitivity analysis
Increase in actuarial assumption (as a percent)	1.00%
Decrease in actuarial assumption (as a percent)	1.00%
Total service costs and interest costs
Sensitivity analysis
Increase (decrease) in defined benefit obligation due to increase in actuarial assumption	R$ 2739
Increase (decrease) in defined benefit obligation due to decrease in actuarial assumption	(2,171)
Present value of the defined benefit obligations
Sensitivity analysis
Increase (decrease) in defined benefit obligation due to increase in actuarial assumption	43,331
Increase (decrease) in defined benefit obligation due to decrease in actuarial assumption	R$ 34975

EMPLOYEE BENEFITS - Other retir

EMPLOYEE BENEFITS - Other retirement and termination benefits (Details) - BRL (R$) R$ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Retirement and termination benefits
EMPLOYEE BENEFITS
Total obligation	R$ 56901	R$ 32863

ENVIRONMENTAL LIABILITIES (Deta

ENVIRONMENTAL LIABILITIES (Details) - BRL (R$) R$ in Thousands	Dec. 31, 2020	Dec. 31, 2019
ENVIRONMENTAL LIABILITIES
Provision for environmental liabilities	R$ 297094	R$ 112308
Current	125,992	60,913
Non-current	R$ 171102	R$ 51395

OBLIGATIONS WITH FIDC - INVES_2

OBLIGATIONS WITH FIDC - INVESTMENT FUND IN CREDIT RIGHTS (Details) - BRL (R$) R$ in Thousands	Dec. 31, 2020	Dec. 31, 2019
OBLIGATIONS WITH FIDC - INVESTMENT FUND IN CREDIT RIGHTS
Current obligations with FIDC	R$ 944513	R$ 0
Non-current obligations with FIDC	R$ 42893	R$ 1018501

EQUITY - Common and preferred s

EQUITY - Common and preferred shares outstanding (Details) - shares	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
EQUITY
Shares exercise period, excluding public offerings	30 days
Shares exercise period for public offering	10 days
Common shares
EQUITY
Authorized capital	1,500,000,000
Reconciliations of common and preferred outstanding shares
Balance at beginning of the year	571,929,945	571,929,945	571,929,945
Balance at end of period	571,929,945	571,929,945	571,929,945
Preferred shares
EQUITY
Authorized capital	3,000,000,000
Reconciliations of common and preferred outstanding shares
Balance at beginning of the year	1,127,010,827	1,124,233,755	1,137,327,184
Acquisition of Treasury shares			(16,000,000)
Exercise of stock options	2,220,660	2,777,072	1,597,235
Transfer of shares			1,309,336
Balance at end of period	1,129,231,487	1,127,010,827	1,124,233,755

EQUITY - Ownership of shares (D

EQUITY - Ownership of shares (Details) - BRL (R$) R$ in Thousands	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
EQUITY
Shares subscribed and paid up	1,719,658,728	1,719,658,728	1,719,658,728
Ownership of shares, as a percentage of total issued shares	100.00%	100.00%	100.00%
Total capital	R$ 19249181	R$ 19249181
Common shares
EQUITY
Shares subscribed and paid up	573,627,483	573,627,483	573,627,483
Ownership of shares, as a percentage of total issued shares	100.00%	100.00%	100.00%
Preferred shares
EQUITY
Shares subscribed and paid up	1,146,031,245	1,146,031,245	1,146,031,245
Ownership of shares, as a percentage of total issued shares	100.00%	100.00%	100.00%
Treasury Stocks
EQUITY
Shares subscribed and paid up	18,497,296	20,717,956	23,495,028
Ownership of shares, as a percentage of total issued shares	1.10%	1.20%	1.40%
Treasury Stocks | Common shares
EQUITY
Shares subscribed and paid up	1,697,538	1,697,538	1,697,538
Ownership of shares, as a percentage of total issued shares	0.30%	0.30%	0.30%
Treasury Stocks | Preferred shares
EQUITY
Shares subscribed and paid up	16,799,758	19,020,418	21,797,490
Ownership of shares, as a percentage of total issued shares	1.50%	1.70%	1.90%
Metalurgica Gerdau S.A.
EQUITY
Shares subscribed and paid up	560,046,701	627,751,085	653,368,823
Ownership of shares, as a percentage of total issued shares	32.60%	36.50%	38.00%
Metalurgica Gerdau S.A. | Common shares
EQUITY
Shares subscribed and paid up	557,898,901	557,898,901	557,898,901
Ownership of shares, as a percentage of total issued shares	97.30%	97.30%	97.30%
Metalurgica Gerdau S.A. | Preferred shares
EQUITY
Shares subscribed and paid up	2,147,800	69,852,184	95,469,922
Ownership of shares, as a percentage of total issued shares	0.20%	6.10%	8.30%
Brazilian institutional investors
EQUITY
Shares subscribed and paid up	230,660,486	244,766,757	226,456,754
Ownership of shares, as a percentage of total issued shares	13.40%	14.20%	13.20%
Brazilian institutional investors | Common shares
EQUITY
Shares subscribed and paid up	3,397,955	3,068,614	2,383,207
Ownership of shares, as a percentage of total issued shares	0.60%	0.50%	0.40%
Brazilian institutional investors | Preferred shares
EQUITY
Shares subscribed and paid up	227,262,531	241,698,143	224,073,547
Ownership of shares, as a percentage of total issued shares	19.80%	21.10%	19.60%
Foreign institutional investors
EQUITY
Shares subscribed and paid up	495,218,544	431,611,203	415,223,778
Ownership of shares, as a percentage of total issued shares	28.80%	25.10%	24.10%
Foreign institutional investors | Common shares
EQUITY
Shares subscribed and paid up	3,142,148	3,875,655	4,836,488
Ownership of shares, as a percentage of total issued shares	0.50%	0.70%	0.80%
Foreign institutional investors | Preferred shares
EQUITY
Shares subscribed and paid up	492,076,396	427,735,548	410,387,290
Ownership of shares, as a percentage of total issued shares	42.90%	37.30%	35.80%
Other shareholders
EQUITY
Shares subscribed and paid up	415,235,701	394,811,727	401,114,345
Ownership of shares, as a percentage of total issued shares	24.10%	23.00%	23.30%
Other shareholders | Common shares
EQUITY
Shares subscribed and paid up	7,490,941	7,086,775	6,811,349
Ownership of shares, as a percentage of total issued shares	1.30%	1.20%	1.20%
Other shareholders | Preferred shares
EQUITY
Shares subscribed and paid up	407,744,760	387,724,952	394,302,996
Ownership of shares, as a percentage of total issued shares	35.60%	33.80%	34.40%

EQUITY - Treasury stocks (Detai

EQUITY - Treasury stocks (Details) - BRL (R$) R$ / shares in Units, R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Value of shares
Balance at beginning of period	R$ 27173127	R$ 25938571	R$ 23861554
Repurchases			243,723
Exercise of stock options	9,596	29,411	23,354
Transfer of shares			18,984
Balance at end of period	R$ 31085210	R$ 27173127	R$ 25938571
Common shares
Number of shares
Balance at beginning of the year	571,929,945	571,929,945	571,929,945
Balance at end of period	571,929,945	571,929,945	571,929,945
Preferred shares
Number of shares
Balance at beginning of the year	1,127,010,827	1,124,233,755	1,137,327,184
Repurchases			16,000,000
Exercise of long-term incentive plan	2,220,660	2,777,072	1,597,235
Transfer of shares			1,309,336
Balance at end of period	1,129,231,487	1,127,010,827	1,124,233,755
Treasury Stocks
EQUITY
Average acquisition cost	R$ 13.62	R$ 12.72	R$ 12.84
Value of shares
Balance at beginning of period	R$ 242542	R$ 280426	R$ 76085
Repurchases			243,396
Exercise of stock options	13,233	37,884	27,433
Transfer of shares			11,622
Balance at end of period	R$ 229309	R$ 242542	R$ 280426
Treasury Stocks | Common shares
Number of shares
Balance at beginning of the year	1,697,538	1,697,538	1,697,538
Balance at end of period	1,697,538	1,697,538	1,697,538
Value of shares
Balance at beginning of period	R$ 557	R$ 557	R$ 557
Balance at end of period	R$ 557	R$ 557	R$ 557
Treasury Stocks | Preferred shares
Number of shares
Balance at beginning of the year	19,020,418	21,797,490	8,704,061
Repurchases			16,000,000
Exercise of long-term incentive plan	(2,220,660)	(2,777,072)	(1,597,235)
Transfer of shares			(1,309,336)
Balance at end of period	16,799,758	19,020,418	21,797,490
Value of shares
Balance at beginning of period	R$ 241985	R$ 279869	R$ 75528
Repurchases			243,396
Exercise of stock options	(13,233)	(37,884)	(27,433)
Transfer of shares			(11,622)
Balance at end of period	R$ 228752	R$ 241985	R$ 279869

EQUITY - Reserves (Details)

EQUITY - Reserves (Details)	12 Months Ended
	Dec. 31, 2020
EQUITY
Minimum legal reserve transfer as a percentage of net income	5.00%
Maximum legal reserve balance as a percentage of total paid-in capital	20.00%
Investments and working capital reserve, annual percentage	5.00%

EQUITY - Operations with non-co

EQUITY - Operations with non-controlling interests (Details) - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Effects of changes in ownership interests in subsidiaries
Effect of interest changes in subsidiaries	R$ 12776	R$ 1586	R$ 85477
Total Parent company's interest
Effects of changes in ownership interests in subsidiaries
Effect of interest changes in subsidiaries	0	0	6
Non-controlling interests
Effects of changes in ownership interests in subsidiaries
Other changes	12,776	(1,586)	(85,483)
Effect of interest changes in subsidiaries	R$ 12776	R$ 1586	R$ 85483

EQUITY - Dividends and interest

EQUITY - Dividends and interest on capital (Details) - BRL (R$) R$ / shares in Units, R$ in Thousands

3 Months Ended

12 Months Ended

Dec. 31, 2020

Sep. 30, 2020

Dec. 31, 2019

Sep. 30, 2019

Jun. 30, 2019

Mar. 31, 2019

Dec. 31, 2018

Sep. 30, 2018

Jun. 30, 2018

Mar. 31, 2018

Dec. 31, 2020

Dec. 31, 2019

Dec. 31, 2018

Dividends and interest on capital

Minimum annual mandatory dividend (as a percent)

30.00%

Related tax benefit arising from the recording of interest on shareholders' capital as financial expense for tax purposes

R$ 98327

R$ 0

Appropriation of retained earnings

Net income

2,365,763

1,203,736

R$ 2303868

Constitution of legal reserve

0

0

0

Constitution of the tax incentives reserve

0

0

0

Dividends and interest on capital

(779,662)

(370,167)

(770,363)

Constitution of investments and working capital reserve

R$ 0

0

0

Credit: November 6, 2020

Dividends and interest on capital

Dividends paid (in R$/share)

R$ 0.12

Outstanding shares

1,701,161

Credit: December 21, 2020

Dividends and interest on capital

Interest on capital paid (in R$/share)

R$ 0.17

R$ 0.17

Outstanding shares

1,701,161

1,701,161

Credit: March 11, 2021

Dividends and interest on capital

Interest on capital paid (in R$/share)

R$ 0.13

R$ 0.13

Outstanding shares

1,701,161

1,701,161

Retained earnings

Appropriation of retained earnings

Net income

R$ 2365763

1,203,736

2,303,868

Constitution of legal reserve

(109,649)

(55,876)

(115,193)

Constitution of the tax incentives reserve

(172,792)

(86,216)

(17,051)

Net income (loss) before dividends and interest on capital

2,083,322

1,061,644

2,171,624

Dividends and interest on capital

(714,487)

(356,539)

(765,339)

Net income (loss) before constitution of investments and working capital reserve

1,368,835

705,105

1,406,285

Constitution of investments and working capital reserve

(1,368,835)

(705,105)

(1,406,285)

Total Parent company's interest

Appropriation of retained earnings

Constitution of legal reserve

0

0

0

Constitution of the tax incentives reserve

0

0

0

Dividends and interest on capital

(714,487)

(356,539)

(765,339)

Constitution of investments and working capital reserve

0

0

0

Dividends and interest on capital

Dividends

R$ 50968

R$ 118817

R$ 118803

R$ 169616

Interest

R$ 238293

R$ 136152

Interest and Dividends

R$ 714487

R$ 356539

R$ 765339

Credit per share (R$)

R$ 0.42

R$ 0.21

R$ 0.45

Total Parent company's interest | Credit: November 6, 2020

Dividends and interest on capital

Dividends

R$ 204139

R$ 67951

R$ 221278

Total Parent company's interest | Credit: December 21, 2020

Dividends and interest on capital

Interest

R$ 289197

Total Parent company's interest | Credit: March 11, 2021

Dividends and interest on capital

Interest

R$ 221151

EARNINGS (LOSS) PER SHARE (EP_3

EARNINGS (LOSS) PER SHARE (EPS) - Basic (Details) - BRL (R$) R$ / shares in Units, R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Basic numerator
Net income	R$ 2365763	R$ 1203736	R$ 2303868
Basic denominator
Earnings per share (in R$) - Basic	R$ 1.39	R$ 0.71	R$ 1.35
Common shares
Basic numerator
Net income	R$ 795617	R$ 405607	R$ 774279
Basic denominator
Weighted-average outstanding shares, after deducting the average treasury shares	571,929,945	571,929,945	571,929,945
Earnings per share (in R$) - Basic	R$ 1.39	R$ 0.71	R$ 1.35
Preferred shares
Basic numerator
Net income	R$ 1570146	R$ 798129	R$ 1529589
Basic denominator
Weighted-average outstanding shares, after deducting the average treasury shares	1,128,700,478	1,125,408,180	1,129,851,598
Earnings per share (in R$) - Basic	R$ 1.39	R$ 0.71	R$ 1.35

EARNINGS (LOSS) PER SHARE (EP_4

EARNINGS (LOSS) PER SHARE (EPS) - Diluted (Details) - BRL (R$) R$ / shares in Units, R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Allocated net income available to Common and Preferred shareholders
Net income	R$ 2365763	R$ 1203736	R$ 2303868
Weighted - average number of shares outstanding
Earnings per share - Diluted (Common and Preferred Shares)	R$ 1.38	R$ 0.70	R$ 1.34
Common shares
Allocated net income available to Common and Preferred shareholders
Net income	R$ 795617	R$ 405607	R$ 774279
Adjustment to net income allocated to preferred shareholders in respect to the potential increase in number of preferred shares outstanding, as a result of long-term incentive plans of Gerdau.	(4,782)	(2,884)	(6,515)
Net income available to owners of parent including effects of dilutive shares	R$ 790835	R$ 402723	R$ 767764
Weighted - average number of shares outstanding
Weighted-average number of shares outstanding	571,929,945	571,929,945	571,929,945
Preferred shares
Allocated net income available to Common and Preferred shareholders
Net income	R$ 1570146	R$ 798129	R$ 1529589
Adjustment to net income allocated to preferred shareholders in respect to the potential increase in number of preferred shares outstanding, as a result of long-term incentive plans of Gerdau.	5,524	2,884	6,515
Net income available to owners of parent including effects of dilutive shares	R$ 1575670	R$ 801013	R$ 1536104
Weighted - average number of shares outstanding
Weighted-average number of shares outstanding	1,128,700,478	1,125,408,180	1,129,851,598
Potential increase in number of preferred shares outstanding in respect of long-term incentive plan of Gerdau	10,821,083	12,157,614	14,440,860
Total	1,139,521,561	1,137,565,794	1,144,292,458

NET SALES (Details)

NET SALES (Details) - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
NET SALES
Gross sales	R$ 49658208	R$ 44558309	R$ 51861423
Taxes on sales	(4,377,135)	(3,819,812)	(3,793,516)
Discounts	(1,466,412)	(1,094,487)	(1,908,429)
Net sales	R$ 43814661	R$ 39644010	R$ 46159478

LONG-TERM INCENTIVE PLANS - Res

LONG-TERM INCENTIVE PLANS - Restricted Shares and Performance Shares (Details) - Restricted Shares and Performance Shares R$ in Thousands	12 Months Ended
	Dec. 31, 2020BRL (R$)EquityInstrumentsshares	Dec. 31, 2019BRL (R$)EquityInstruments	Dec. 31, 2018BRL (R$)EquityInstruments
LONG-TERM INCENTIVE PLANS
Balance, beginning of year	13,018,407	14,261,501	18,975,084
Granted	3,146,696	2,647,995	2,411,345
Cancelled	(1,777,100)	(2,104,754)	(3,150,635)
Exercised	(1,918,669)	(1,786,335)	(3,974,293)
Balance, end of year	12,469,334	13,018,407	14,261,501
Expense from equity-settled long-term incentive plan | R$	R$ 62801	R$ 43895	R$ 41186
Awards granted in 2016 and prior
LONG-TERM INCENTIVE PLANS
Grace period	5 years
Awards granted in 2017 and later
LONG-TERM INCENTIVE PLANS
Grace period	3 years
Preferred shares
LONG-TERM INCENTIVE PLANS
Treasury shares | shares	16,799,758

LONG-TERM INCENTIVE PLANS - Sto

LONG-TERM INCENTIVE PLANS - Stock option activity (Details) - Stock options	12 Months Ended
	Dec. 31, 2019OptionsR$ / shares	Dec. 31, 2018OptionsR$ / shares
Number of shares
Balance, beginning of year | Options	15,480	292,391
Options Exercised | Options		(33,499)
Options Forfeited | Options	(15,480)	(243,412)
Balance, end of year | Options		15,480
Average exercise price in the year
Beginning of year | R$ / shares	R$ 16.72	R$ 17.91
Options Exercised | R$ / shares		14.86
Options Forfeited | R$ / shares	16.72	18.62
End of year | R$ / shares		R$ 16.72

SEGMENT REPORTING - Summary (De

SEGMENT REPORTING - Summary (Details) - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Segment reporting as per business segments
Net sales	R$ 43814661	R$ 39644010	R$ 46159478
Cost of sales	(37,884,102)	(35,440,726)	(40,010,100)
GROSS PROFIT	5,930,559	4,203,284	6,149,378
Selling, general and administrative expenses	(1,530,385)	(1,430,456)	(1,652,880)
Other operating income (expenses)	1,117,699	449,200	(34,992)
Impairment of non-financial assets	(411,925)	0	0
Impairment of financial assets	(64,132)	(21,044)	(9,914)
Gains and losses on assets held for sale and sales of interest in subsidiaries	0	0	(414,507)
Equity in earnings of unconsolidated companies	152,569	(17,050)	10,141
INCOME BEFORE FINANCIAL INCOME (EXPENSES) AND TAXES	5,194,385	3,183,934	4,047,226
Financial result, net	(1,698,707)	(1,509,214)	(1,889,795)
INCOME (LOSS) BEFORE TAXES	3,495,678	1,674,720	2,157,431
Income and social contribution taxes	(1,107,624)	(457,833)	168,951
Net income	2,388,054	1,216,887	2,326,382
Depreciation/amortization	2,499,104	2,074,295	1,891,814
Investments in associates and jointly-controlled entities	2,271,629	1,812,399	1,367,802	R$ 1280299
Total assets	63,123,009	54,002,970	51,281,029
Total liabilities	32,037,799	26,829,843	25,342,458
North America
Segment reporting as per business segments
Impairment of non-financial assets	(342,355)
Special Steel
Segment reporting as per business segments
Impairment of non-financial assets	(69,570)
Operating Segments | Brazil
Segment reporting as per business segments
Net sales	17,752,823	16,122,171	15,745,161
Cost of sales	(14,179,991)	(14,363,253)	(13,044,433)
GROSS PROFIT	3,572,832	1,758,918	2,700,728
Selling, general and administrative expenses	(562,019)	(539,344)	(569,595)
Other operating income (expenses)	31,500	295,818	(33,814)
Impairment of financial assets	(23,177)	(2,012)	5,564
Equity in earnings of unconsolidated companies	(1,287)	(828)	(1,700)
INCOME BEFORE FINANCIAL INCOME (EXPENSES) AND TAXES	3,017,849	1,512,552	2,101,183
Financial result, net	(442,972)	(520,821)	(442,966)
INCOME (LOSS) BEFORE TAXES	2,574,877	991,731	1,658,217
Income and social contribution taxes	(652,126)	(214,400)	(410,651)
Net income	1,922,751	777,331	1,247,566
Depreciation/amortization	1,135,294	1,008,713	951,826
Investments in associates and jointly-controlled entities	10,186	11,472	3,250
Total assets	21,099,735	17,195,824	17,473,039
Total liabilities	7,469,541	4,686,686	8,072,380
Operating Segments | North America
Segment reporting as per business segments
Net sales	17,458,318	14,656,028	19,927,390
Cost of sales	(16,212,757)	(13,351,209)	(18,164,834)
GROSS PROFIT	1,245,561	1,304,819	1,762,556
Selling, general and administrative expenses	(476,518)	(444,326)	(602,351)
Other operating income (expenses)	97,751	44,660	19,114
Impairment of non-financial assets	(342,355)
Impairment of financial assets	(36,286)	(14,612)	(5,230)
Equity in earnings of unconsolidated companies	23,512	(110,959)	(77,872)
INCOME BEFORE FINANCIAL INCOME (EXPENSES) AND TAXES	511,665	779,582	1,096,217
Financial result, net	(206,405)	(99,029)	(37,351)
INCOME (LOSS) BEFORE TAXES	305,260	680,553	1,058,866
Income and social contribution taxes	(178,447)	(188,458)	(224,897)
Net income	126,813	492,095	833,969
Depreciation/amortization	777,369	571,015	511,154
Investments in associates and jointly-controlled entities	908,338	681,807	301,271
Total assets	18,583,439	15,178,053	14,659,926
Total liabilities	5,261,820	4,506,771	4,935,210
Operating Segments | South America
Segment reporting as per business segments
Net sales	3,831,406	3,259,253	3,801,210
Cost of sales	(3,015,189)	(2,762,157)	(3,230,952)
GROSS PROFIT	816,217	497,096	570,258
Selling, general and administrative expenses	(116,479)	(119,627)	(132,245)
Other operating income (expenses)	16,684	17,416	(11,421)
Impairment of financial assets	(2,436)	(1,906)	(4,462)
Equity in earnings of unconsolidated companies	99,341	66,468	51,648
INCOME BEFORE FINANCIAL INCOME (EXPENSES) AND TAXES	813,327	459,447	473,778
Financial result, net	(60,787)	(163,459)	(117,270)
INCOME (LOSS) BEFORE TAXES	752,540	295,988	356,508
Income and social contribution taxes	(195,440)	(100,341)	(86,667)
Net income	557,100	195,647	269,841
Depreciation/amortization	142,143	120,462	88,537
Investments in associates and jointly-controlled entities	976,046	748,392	701,233
Total assets	5,448,922	4,562,604	4,421,487
Total liabilities	1,360,098	996,876	1,053,007
Operating Segments | Special Steel
Segment reporting as per business segments
Net sales	6,096,471	6,701,900	8,158,626
Cost of sales	(5,794,666)	(6,167,502)	(7,064,608)
GROSS PROFIT	301,805	534,398	1,094,018
Selling, general and administrative expenses	(179,822)	(170,170)	(180,251)
Other operating income (expenses)	55,097	35,571	10,081
Impairment of non-financial assets	(69,570)
Impairment of financial assets	(2,233)	(2,513)	(5,786)
Equity in earnings of unconsolidated companies	8,899	6,776	15,629
INCOME BEFORE FINANCIAL INCOME (EXPENSES) AND TAXES	114,176	404,062	933,691
Financial result, net	(215,433)	(109,116)	(112,109)
INCOME (LOSS) BEFORE TAXES	(101,257)	294,946	821,582
Income and social contribution taxes	13,229	(60,749)	(191,386)
Net income	(88,028)	234,197	630,196
Depreciation/amortization	444,298	374,105	340,297
Investments in associates and jointly-controlled entities	231,152	224,201	213,899
Total assets	11,233,676	8,597,180	8,825,830
Total liabilities	1,994,575	1,604,885	1,736,085
Eliminations and Adjustments
Segment reporting as per business segments
Net sales	(1,324,357)	(1,095,342)	(1,472,909)
Cost of sales	1,318,501	1,203,395	1,494,727
GROSS PROFIT	(5,856)	108,053	21,818
Selling, general and administrative expenses	(195,547)	(156,989)	(168,438)
Other operating income (expenses)	916,667	55,734	(18,952)
Gains and losses on assets held for sale and sales of interest in subsidiaries			(414,507)
Equity in earnings of unconsolidated companies	22,104	21,493	22,436
INCOME BEFORE FINANCIAL INCOME (EXPENSES) AND TAXES	737,368	28,291	(557,643)
Financial result, net	(773,110)	(616,789)	(1,180,099)
INCOME (LOSS) BEFORE TAXES	(35,742)	(588,498)	(1,737,742)
Income and social contribution taxes	(94,840)	106,115	1,082,552
Net income	(130,582)	(482,383)	(655,190)
Investments in associates and jointly-controlled entities	145,907	146,527	148,149
Total assets	6,757,237	8,469,309	5,900,747
Total liabilities	15,951,765	15,034,625	9,545,776
Eliminations and Adjustments | Brazil
Segment reporting as per business segments
Net sales	(1,149,618)	(920,659)	(1,280,770)
Eliminations and Adjustments | North America
Segment reporting as per business segments
Net sales	(60,370)	(62,196)	(84,335)
Eliminations and Adjustments | South America
Segment reporting as per business segments
Net sales	(41)		(4,988)
Eliminations and Adjustments | Special Steel
Segment reporting as per business segments
Net sales	R$ 114328	R$ 112487	R$ 102816

SEGMENT REPORTING - Revenues by

SEGMENT REPORTING - Revenues by Geographical Region (Details) - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Segment reporting as per geographical areas
Net sales	R$ 43814661	R$ 39644010	R$ 46159478
Total assets	63,123,009	54,002,970	51,281,029
Brazil
Segment reporting as per geographical areas
Net sales	18,798,384	17,573,278	17,284,473
Total assets	28,752,629	26,124,159	26,283,287
Latin America
Segment reporting as per geographical areas
Net sales	4,996,434	4,201,165	4,785,281
Total assets	7,042,462	5,781,527	5,251,637
North America
Segment reporting as per geographical areas
Net sales	20,019,843	17,869,567	23,524,381
Total assets	R$ 27327918	R$ 22097284	19,746,105
Europe/Asia
Segment reporting as per geographical areas
Net sales			R$ 565343

INSURANCE (Details)

INSURANCE (Details) - BRL (R$) R$ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Assets
INSURANCE
Amount of assets or liabilities covered under insurance contracts	R$ 82836077	R$ 61187789
Business Interruption
INSURANCE
Amount of assets or liabilities covered under insurance contracts	11,146,083	11,381,183
Civil Liability
INSURANCE
Amount of assets or liabilities covered under insurance contracts	R$ 711948	R$ 652973

IMPAIRMENT OF ASSETS (Details)

IMPAIRMENT OF ASSETS (Details) R$ in Thousands	12 Months Ended
	Dec. 31, 2020BRL (R$)segment	Dec. 31, 2019BRL (R$)	Dec. 31, 2018BRL (R$)
Impairment of assets
Impairment of property, plant and equipment	R$ 411925	R$ 0	R$ 0
Impairment of goodwill	R$ 0	R$ 0	R$ 0
Number of operating segments | segment	4
Period for projecting the cash flows for the goodwill impairment test	P5Y
Discount rate
Impairment of assets
Sensitivity analysis, percent of increase	0.50%	0.50%
Perpetuity growth rate
Impairment of assets
Sensitivity analysis, percent of decrease	0.50%	0.50%
North America
Impairment of assets
Impairment of property, plant and equipment	R$ 342355
Perpetuity growth rate	3.00%	3.00%
Pre-tax discount rate	8.25%	10.00%
Amount by which unit's recoverable amount is (below) exceeds its carrying value	R$ 6202000	R$ 2690000
North America | Discount rate
Impairment of assets
Sensitivity analysis, amount above (below) book value	4,589,000	1,884,000
North America | Perpetuity growth rate
Impairment of assets
Sensitivity analysis, amount above (below) book value	4,914,000	R$ 2098000
Special Steel
Impairment of assets
Impairment of property, plant and equipment	R$ 69570
Perpetuity growth rate	3.00%	3.00%
Pre-tax discount rate	8.75%	10.50%
Amount by which unit's recoverable amount is (below) exceeds its carrying value	R$ 2509000	R$ 2813000
Special Steel | Discount rate
Impairment of assets
Sensitivity analysis, amount above (below) book value	1,568,000	2,207,000
Special Steel | Perpetuity growth rate
Impairment of assets
Sensitivity analysis, amount above (below) book value	R$ 1754000	R$ 2369000
South America
Impairment of assets
Perpetuity growth rate	3.00%	3.00%
Pre-tax discount rate	11.25%	14.25%
Amount by which unit's recoverable amount is (below) exceeds its carrying value	R$ 4141000	R$ 521000
South America | Discount rate
Impairment of assets
Sensitivity analysis, amount above (below) book value	3,757,000	414,000
South America | Perpetuity growth rate
Impairment of assets
Sensitivity analysis, amount above (below) book value	R$ 3867000	R$ 455000
Brazil
Impairment of assets
Perpetuity growth rate	3.00%	3.00%
Pre-tax discount rate	9.75%	11.25%
Amount by which unit's recoverable amount is (below) exceeds its carrying value	R$ 13424000	R$ 4015000
Brazil | Discount rate
Impairment of assets
Sensitivity analysis, amount above (below) book value	11,348,000	2,810,000
Brazil | Perpetuity growth rate
Impairment of assets
Sensitivity analysis, amount above (below) book value	R$ 11809000	R$ 3115000

EXPENSES BY NATURE - Classified

EXPENSES BY NATURE - Classified by nature (Details) - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
EXPENSES BY NATURE
Depreciation and amortisation	R$ 2499104	R$ 2074295	R$ 1891814
Labor expenses	(5,867,265)	(5,175,373)	(5,724,352)
Raw material and consumption material	(26,945,440)	(25,890,618)	(29,623,418)
Freight	(2,572,293)	(2,300,439)	(2,770,516)
Impairment of non-financial assets	(411,925)	0	0
Gains and losses on assets held for sale and sales of interest in subsidiaries	0	0	(414,507)
Other expenses/income, net	(476,818)	(1,002,301)	(1,697,786)
Total Expenses	R$ 38772845	R$ 36443026	R$ 42122393

EXPENSES BY NATURE - Classifi_2

EXPENSES BY NATURE - Classified by function (Details) - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
EXPENSES BY NATURE
Cost of sales	R$ 37884102	R$ 35440726	R$ 40010100
Selling expenses	(512,950)	(476,339)	(570,431)
General and administrative expenses	(1,017,435)	(954,117)	(1,082,449)
Other operating income	1,763,684	636,847	235,421
Other operating expenses	(645,985)	(187,647)	(270,413)
Impairment of financial assets	(64,132)	(21,044)	(9,914)
Impairment of non-financial assets	(411,925)	0	0
Gains and losses on assets held for sale and sales of interest in subsidiaries	0	0	(414,507)
Total Expenses	R$ 38772845	R$ 36443026	R$ 42122393

FINANCIAL INCOME (Details)

FINANCIAL INCOME (Details) - BRL (R$) R$ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
FINANCIAL INCOME
Income from short-term investments	R$ 108057	R$ 87241	R$ 68721
Interest income and other financial income	86,035	135,972	135,279
Financial Income	194,092	223,213	204,000
Interest on debt	(1,022,460)	(938,120)	(1,177,686)
Monetary variation and other financial expenses	(426,001)	(531,634)	(401,655)
Financial Expenses	(1,448,461)	(1,469,754)	(1,579,341)
Bonds repurchases	(239,273)	0	(223,925)
Exchange Variation, net	(204,291)	(247,555)	(322,621)
Gains and losses on derivative financial instruments, net	(774)	(15,118)	32,092
Financial result, net	R$ 1698707	R$ 1509214	R$ 1889795