Mexico steel industry seen advancing with USMCA

The recent signing of a modifying protocol as part of the USMCA agreement between the US, Mexico and Canada, is progressive and is expected to bring advances to Mexico's steel producing chain, according to Dolores Padierna, vice president of Mexico's chamber of deputies.

The legislator said that once the trade agreement went into force, the US sought to immediately apply the rule that states that 70% of the steel used by the Mexican industry should be supplied by producers in the North American continent, according to Mexican paper Milenio  

However, the modifying protocol gave a seven-year period to Mexico to adapt to the percentage rule.

"That would have affected Mexican industry, given that we currently import large quantities [of steel] from Brazil, so the achievement was to establish a seven-year period for this change. In this sense, Mexico will also have to develop this industry," Padierna was quoted as saying.

Carlos Salazar Lomelín, president of Mexican business organization CCE, said in a separate Milenio report that the new trade agreement will lead to more steel plants in the country.

"In the short term it will be complicated, but in the medium term we're going to have more steel mills in the country, which is positive," Lomelín was cited as saying.

Mexico produced 17.1Mt of steel during January-November, down 8% year-on-year, according to the latest data from the World Steel Association (worldsteel).

Photo: AFP