Point of view: Production of rolled steel in Mexico may recover in 2026
The Mexican flat-rolled steel market expects demand to recover in 2026 after almost two years of decline.
Steel consumption in Mexico dropped by 10% in the first 10 months of 2025 compared to the previous year, according to the Canacero Steel Chamber. This decline followed a 5% decline in demand throughout 2024, which was followed by a 14% increase in 2023, driven by both rising foreign investment and expanding domestic production.
As a result of lower levels of domestic and foreign investment, domestic steel demand in Mexico has declined for almost 22 consecutive months, leading to lower prices.
This is due to the fact that the United States, once the largest importer of Mexican steel, has effectively shut down the market, depriving the Mexican company of the necessary pressure. the market during internal recessions.
On March 12, 2025, the United States imposed duties of 25% on imported steel, which doubled to 50% on June 4. Mexico has been exempt from U.
S. steel import duties since 2019 under the U.
S.-Mexico-Canada Agreement (USMCA), until the U.
S. imposed global tariffs on steel imports. According to the latest data from Canacero, Mexican steel exports to the United States in January-October decreased by 27% to 1.9 million metric tons compared to the same period in 2024.
On December 11, the Mexican Congress voted to raise tariffs on more than 1,400 goods from countries participating in the non-trade cooperation Agreement (NTT), including some steel products and steel-consuming industries such as automobiles and auto parts, from January 1. For these NTT countries, including China, South Korea, and Japan, steel tariffs will rise to 20-50% from the current 0-50%, auto tariffs will rise to 50% from 15-20%, and auto parts tariffs will rise to 10-50% from the current range of 0-35%.
The import tariff for hot-rolled coils will increase from 25% to 35%, while the tariff for rebar will remain at 35%.
The tariffs, which mainly target China and other Asian countries accused of undermining domestic markets in Latin America, are part of efforts to boost domestic demand and counter U.
S. tariffs. Many also see them as an attempt to appease the United States ahead of the USMCA negotiations, as the United States has accused Mexico of serving as a conduit for tariff-free Asian steel to enter the U.
S. market.
The current market situation is expected to remain unchanged until the US tariffs are increased. They will be considered during the USMCA negotiations next summer or until domestic demand increases, which is not expected in the near term.
Tariffs increase headwinds
Although the US tariffs have only increased the pressure on domestic steel consumption, they have appeared