Canacero reaffirms investment of $8.7 billion over five years

The Mexican steel industry reaffirmed investments of $8.7 billion over the next five years as part of Plan Mexico, which will allow it to manufacture steel in the North American region.

Celebrating its 77th anniversary, the National Chamber of the Iron and Steel Industry (Canacero) expressed its commitment to replacing imports from Asia: "It's time for steel made in Mexico."

Mexico is the world's 15th largest steel producer and the largest consumer of finished products in Latin America, accounting for 1.4% of GDP and 6.9% of manufacturing GDP.

"We reaffirmed strategic investments totaling $8.7 billion over the next five years, supporting Plan Mexico, in addition to the $6.4 billion invested during the previous six-year term," Canacero emphasized.

Faced with the possibility of imposing higher tariffs on imports under the Asian agreement, the national industry asserted that this is the best time to promote regional integration, import substitution, and domestic content.

"We have an opportunity to leverage synergies between Mexico and the United States. It's time to join forces and highlight what's Made in Mexico," he said.

China has used North America as its largest steel sales platform, resulting from the deindustrialization process it is undergoing.

In response, last February, US President Donald Trump, protected by the International Emergency Economic Powers Act (IEEPA), imposed 25% tariffs on imported products from China, which also included Mexico and Canada.

The Mexican steel industry faces a double tariff, as a 25% tariff on imported steel and some of its derivatives went into effect on March 12. The steel tariff doubled to 50% on June 4.

This tariff has affected the national industry in its shipments to the US, since our northern neighbor buys more than 70% of all "Made in Mexico" steel.

Faced with a complex global environment, the steel industry has asked the federal government to implement measures to defend Mexican production, promote competitiveness, and protect employment—fundamental pillars of the country's industrial development.

Recently, Canacero announced that she is ready to actively participate in the USMCA review process, a negotiation that is fundamental to the future of our country.

To this end, the industry is continuing its investments during Claudia Sheinbaum's six-year term, which will allow for an increase in finished steel product production to 30 million tons annually. If this goal is met, an average annual growth rate of 1.8% will be achieved in the 2024-2030 period, according to Tyasa.

"The idea is for steel produced in Mexico to meet and supply 100% of Mexico's domestic consumption. The projection is to reach 30 million tons annually by 2030."

Steel investments are aligned with the growth plans and demands of industries such as automotive, mining, construction, aerospace, household appliances, oil, gas, and electricity, among others.

“Steel is a strategic sector to support the development of the industrial value chain in Mexico and the North American region, with significant investments totaling more than $16.2 billion over the past 11 years (2012-2022), and $8.7 billion in investments have also been confirmed for this six-year term,” Canacero commented.

But Mexico is seeking to grow alongside its USMCA trading partners, the U.S. and Canada, and is planning to table the idea of ​​reviving a committee comprised of steel companies from both countries, as well as trade officials from both governments.