{"id":1124,"date":"2025-04-01T15:34:06","date_gmt":"2025-04-01T15:34:06","guid":{"rendered":"https:\/\/grupollg.mx\/eng\/?p=1124"},"modified":"2025-04-01T15:34:06","modified_gmt":"2025-04-01T15:34:06","slug":"trumps-tariffs-put-latin-americas-steel-industry-on-the-ropes","status":"publish","type":"post","link":"https:\/\/grupollg.mx\/eng\/index.php\/2025\/04\/01\/trumps-tariffs-put-latin-americas-steel-industry-on-the-ropes\/","title":{"rendered":"Trump’s tariffs put Latin America’s steel industry on the ropes."},"content":{"rendered":"

In 2024, Chile’s largest steel mill, Huachipato, closed, defeated by cheap steel from China. Six months later,\u00a0\u00a0<\/span>Donald Trump’s tariffs<\/span><\/b>\u00a0\u00a0threaten the livelihoods of 1.4 million people working in this industry in Latin America.<\/span><\/p>\n

As in his first term (2017-2021), the US president aims to protect the American steel industry by making imported metal more expensive, with tariffs of 25% that have been in effect since March 12.<\/span><\/p>\n

The United States imports 25 million tons of the metal annually. Canada is its largest individual supplier,\u00a0\u00a0<\/span>followed by Brazil and Mexico<\/span><\/b>\u00a0, with products destined for other industries such as automotive and construction.<\/span><\/p>\n

The U.S. industry “needs to stock up” on products with “special technologies, steels that it has always purchased from Latin America,” Ezequiel Tavernelli, executive director of the Latin American Steel Association (Alacero), told AFP.<\/span><\/p>\n

Therefore, in a context of global steel overproduction, led by China, tariffs will be a major distortion for the market: “The only thing it would cause is a flood of steel due to the diversion of trade from that steel that was headed to the United States to less protected regions (and) with less defense capacity,” such as Latin America, the executive points out.<\/span><\/p>\n

To explain the seriousness of the threat, he recalls that in 2000, China exported less than 100,000 tons of steel annually to Latin America. “Today, it’s over 14 million. (The growth) is exponential,” he emphasized.<\/span><\/p>\n

Steel production in Latin America has been declining for three years. In 2024, the decline was 3.6% to 56 million tons, compared to a consumption of 73 million. China’s share of the total used in the region is increasing.<\/span><\/p>\n

Due to Trump’s tariffs, Latin American producers would not only lose access to the United States, but their loss of market share to Chinese steel in their own countries would also be exacerbated.<\/span><\/p>\n

When it rains, it pours<\/span><\/h2>\n

The numbers are stark.<\/span><\/p>\n

The world has an annual production capacity of 2.48 billion tons of steel. Of that total,\u00a0\u00a0<\/span>China accounts for 1.14 billion, more than 45 percent<\/span><\/b>\u00a0. The Asian giant uses most of it, but has about 140 million tons left over, which end up on the international market at dumped prices, according to Alacero.<\/span><\/p>\n

“One of the countries with the greatest overcapacity and flooding our markets with steel is China, and it does so unfairly,” with prices below cost thanks to government subsidies ranging from energy to credit, Tavernelli noted.<\/span><\/p>\n

23% of the world’s excess steel production comes from China.<\/span><\/p>\n

Last September, Chileans experienced firsthand the impact of this situation, which Tavernelli describes with concern: Huachipato, the country’s largest steel industry, shut down its furnaces. In a matter of hours, with the smoke that stopped rising from the chimneys, almost 75 years of history vanished.<\/span><\/p>\n

The surcharges imposed by the authorities weren’t enough.\u00a0<\/span>\u00a0Chinese steel is 40% cheaper than Chilean steel<\/span><\/b>\u00a0. Competition has become impossible.<\/span><\/p>\n

Working as a team<\/span><\/h2>\n

Alacero argues that the “regionalization” of the production chain\u2014that is, the United States sourcing steel from its neighbors\u2014is “the best defense against unfair trade from China and Southeast Asian countries.”<\/span><\/p>\n

Or, as Brazil’s Vice President and Minister of Development, Industry, Trade, and Services, Geraldo Alckmin, pointed out, the goal is “economic complementarity.”\u00a0\u00a0<\/span>Brazil, like Mexico, is negotiating alternatives\u00a0<\/span><\/b>\u00a0to avoid Trump’s tariffs, a path that already worked during his first presidency.<\/span><\/p>\n

Along the same lines, in Mexico, the National Chamber of the Iron and Steel Industry (Canacero) recalled in February “the high level of productive integration” with the United States and noted that “regional benefits must be a priority in the face of the threat of excess capacity in China and Southeast Asia.”<\/span><\/p>\n

Likewise, the Argentine Chamber of Steel (CAA) stated that while it understands “the need to establish defensive measures against unfair competition in the face of China’s rise as the world’s leading steel producer, the response must be coordinated.”<\/span><\/p>\n

In this context of tension, the risk is that there will be more cases like Huachipato, “of companies with a history, with years of production, with great standing, (that) lose and have to close,” warned Tavernelli, who insists on working together to avoid this.<\/span><\/p>\n

Trump’s tariffs put Latin America’s steel industry on the ropes.<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

In 2024, Chile’s largest steel mill, Huachipato, closed, defeated by cheap steel from China. Six months later,\u00a0\u00a0Donald Trump’s tariffs\u00a0\u00a0threaten the livelihoods of 1.4 million people working in this industry in Latin America. As in his first term (2017-2021), the US president aims to protect the American steel industry by making imported metal more expensive, with […]<\/p>\n","protected":false},"author":1,"featured_media":1125,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","footnotes":""},"categories":[3],"tags":[],"class_list":["post-1124","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-noticias"],"_links":{"self":[{"href":"https:\/\/grupollg.mx\/eng\/index.php\/wp-json\/wp\/v2\/posts\/1124","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/grupollg.mx\/eng\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/grupollg.mx\/eng\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/grupollg.mx\/eng\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/grupollg.mx\/eng\/index.php\/wp-json\/wp\/v2\/comments?post=1124"}],"version-history":[{"count":1,"href":"https:\/\/grupollg.mx\/eng\/index.php\/wp-json\/wp\/v2\/posts\/1124\/revisions"}],"predecessor-version":[{"id":1126,"href":"https:\/\/grupollg.mx\/eng\/index.php\/wp-json\/wp\/v2\/posts\/1124\/revisions\/1126"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/grupollg.mx\/eng\/index.php\/wp-json\/wp\/v2\/media\/1125"}],"wp:attachment":[{"href":"https:\/\/grupollg.mx\/eng\/index.php\/wp-json\/wp\/v2\/media?parent=1124"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/grupollg.mx\/eng\/index.php\/wp-json\/wp\/v2\/categories?post=1124"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/grupollg.mx\/eng\/index.php\/wp-json\/wp\/v2\/tags?post=1124"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}