1. Overview of Mexico

The United Mexican States (Spanish: Los Estados Unidos Mexico), abbreviated as "Mexico", has a territory of 1.9644 million square kilometers, making it the third largest country in Latin America and ranks 14th in the world. The capital is Mexico City. In 2024, Mexico's total population will be 131 million.

Mexico is a Latin American economic power, a member of the US-Mexico-Canada Agreement (formerly North American Free Trade Zone), one of the world's most open economies, and has signed a free trade agreement with 50 countries. In 2024, the GDP was US$1.85 trillion, an increase of 1.2% year-on-year, and the per capita GDP was US$13,800.

Ink mainly exports crude oil, industrial products, petroleum products, clothing, agricultural products, etc. The main export target countries are the United States, Canada, the European Union, Central America, China, etc.; the main imports of food, pharmaceutical products, communication equipment, etc., and the main import sources are the United States, China, Germany, Japan, South Korea, etc. The total foreign trade volume in 2024 was US$1242.41 billion, of which the export volume was US$617.1 billion and the import volume was US$625.31 billion, an increase of 4.3%, 4.1% and 4.5% year-on-year respectively.

2. Overview of Mexican Steel

Mexico is currently the 15th largest steel producer in the world and the second largest steel producer in Latin America, occupies an important position in the global steel industry. In 2023, about 30 million tons of iron ore will be mined, 1 million tons of pig iron, 16.2 million tons of crude steel, and 19.9 million tons of steel. In 2024, the crude steel output will be about 13.7 million tons, downward details.

Mexico widely adopts the electric furnace continuous casting production process, and the finished steel is mainly structural alloy steel, special alloy steel and tool alloy steel.

The apparent consumption of Mexican steel is generally showing a volatile growth trend. The total apparent consumption of steel is 24.4 million tons, 21.9 million tons, 25.5 million tons, 29 million tons and 27.6 million tons respectively from 2019 to 2024. According to the World Iron and Steel Association's forecast, it will be 29.3 million tons in 2025. At present, Mexico's per capita steel consumption has exceeded the global per capita level, with 221kg in 2024.

Mexico is a net importer of steel. In 2024, 4.5 million tons of steel were imported, and the main sources of imports were the United States (32.5%), South Korea (15.7%), Japan (14.5), China (9.7%), etc.; 2.1 million tons of steel were exported, and the main destinations were the United States (77%) and other Latin American countries.

3. Major Mexican steel enterprises

Steel production is mainly concentrated in northern and central Mexico, and the country's major steel companies include AHMSA, Deacero, Grupo Acerero, Grupo Simec, etc.

（1） AHMSA

Mexican steel giant Altos Hornos de Mexico (AHMSA) is one of the largest state-owned enterprises in Mexico, involving steel production and related businesses. The annual production capacity of crude steel exceeds 5.5 million tons. It is located in Monclova, Coahuila, Coahuila. It was founded in 1942 and mainly uses coal and iron ore steelmaking in Coahuila and Chihuahua.

The steel giant ceased operations in 2023 due to insolvency, and the steel company, along with its own mines, will be sold as a whole, with the Mexican judiciary allocating funds from the sale to repay creditors. It is worth noting that Minosa has high-quality iron ore with proven reserves of 1.2 billion tons, which may become a key bargaining chip to attract strategic investors in the context of high international mine prices.

（2）Deacero

Deacero, one of Mexico's largest steel companies, is a member of ISRI and BIR. It has 3 smelting plants in Mexico with a total production capacity of 4.5 million tons. It has set up 18 large freight yards and multiple distribution centers throughout Mexico. Since 2009, it has been involved in the scrap metal industry, and has used its excellent hardware conditions to recycle large quantities of scrap metals including scrap copper, scrap aluminum, scrap steel and other scrap metals.

Customers are located in China, the United States, Canada, Japan, South Korea and Europe. Deacero uses scrap steel raw materials to produce steel products and export them to the United States, Europe, Central America, South America and the Caribbean. DEACERO recycles scrap metals to 50% of Mexico's national level.

（3） Grupo Acerero

Founded in 1995, it is a comprehensive steel and steel manufacturer. It is a steel plant located in San Luis Potosi, Mexico. It uses electric arc furnace (EAF) technology and an annual production capacity of more than 1.5 million tons. Like Deacero, it uses scrap steel raw materials to produce steel products. Mexico is the fifth largest steel bar manufacturer and also the Mexican steel plate manufacturer. Mainly exported to the Americas.

（4）Grupo Simec

Group Simec was incorporated in Mexico on August 22, 1990 and is headquartered in Guadalajara, Mexico. The company is a diversified manufacturer, processor and distributor of special bar quality, wire, rebar, structural steel and other products. It is the largest special bar steel (SBQ) manufacturer in North America, conducting production and commercial operations in the United States, Mexico and Canada.

Simec is an important manufacturer of Mexican structural and light structural steel products. The company's SBQ products are used in a wide range of highly engineered end-user applications, including axles, hubs and crankshafts, machine tools and off-highway equipment for automotive and light trucks. The company's structural steel products are mainly used in the non-residential construction market and other construction applications.

（5）ArcelorMittal Mexico

The steel mill of steel manufacturer ArcelorMittal Mexico is located in Lázaro Cárdenas, Michoacán, Mexico. The annual crude steel production capacity is about 6.4 million tons per year. At the same time, as Mexico's largest rebar producer, ArcelorMittal's Mexican branch has a market share of 18.9%, with a production of approximately 491,400 tons.

4. Mexican steel structure optimization and continuous expansion of output

In 2025, the Mexican steel industry is undergoing a stable capacity transfer, and investment projects are steadily advancing across the entire value chain from upstream to downstream processing. With demand increasing and companies intend to reduce their dependence on imports, several Mexican steel producers are promoting capacity expansion and technology upgrades.

（1） Deacero

Deacero plans to complete the upgrade of a 2.8 million ton/year steelmaking workshop and two wire plants by 2025, thus fulfilling its sustainable development commitment to reduce carbon dioxide emissions by 56% by 2030. Danieli supplies a new zero-basket arc furnace with a horizontal continuous scrap charge system to replace the existing No. 2 arc furnace, improving operational efficiency and minimizing environmental footprint by improving energy utilization and continuous productivity. In addition to the furnace body, the Q-Melt automatic process control components and Q3-intelligence technology, it also includes a technologically advanced sixth generation billet welded headless rolling (EWR) equipment and a new 130t/h high-speed bar finishing line, equipped with two Danieli HTC high-speed dual-channel systems and five automatic bar counting systems, which ultimately enables the Deacero 1.7 million tons/year wire plant to stably produce 9.5mm high-quality steel bars at a rolling speed of 40m/s.

In addition, Deacero also installed a new dual-module high-speed shearing machine for automatic rod cutting head and tail for the 1 million tons/year wire plant, as well as an oil film bearing wire spinning machine using Danieli patented technology. After the wire spinning machine is installed in the finishing mill unit, the unit allows a stable wire rolling speed of up to 120m/s. Advanced Danieli automation systems and technology packages will replace and update the original system, ensuring production control over the entire short-process plant.

In the first quarter of 2026, a short-process steel plant near the Arispe factory in Ramos is expected to be officially launched. The plant will use high-end environmentally friendly technology to produce long-material products. The factory has a 150-ton arc furnace, which has automatic raw material processing capacity, can carry out uninterrupted scrap steel loading, a double-station ladle furnace and a six-stream casting machine with a radius of 10m, equipped with a crystallizer stirrer and two cold beds. Also installed by Danieli, advanced automation solutions include a large Hi-Profile laser profiler for detecting typical rolling defects on the steel surface and a high-performance water-cooled vector-controlled driver for the steel rolling mills—the Q-Drive medium-voltage drivetrain. The plant can produce 1.5 million tons of steel per year and can reach 702mm in size. It is expected to help the development of Mexican manufacturing, petroleum industry and industrial construction sectors in the future.

（2） Grupo Acerero

Grupo Acerero is planning to start slab production and operations at a new steel plant in San Luis Potosi in September 2025. The $650 million project includes the installation of a new electric arc furnace (EAF), a ladle refining furnace (LF), a slab continuous casting machine with an annual output of 650,000 tons, and a medium-thickness plate production line with an annual output of 650,000 tons. According to the capacity improvement plan, the production scale in 2025 is expected to be 150,000 tons, and will gradually increase to 650,000 tons by 2028.

By then, the company will eliminate its import dependence on slabs that currently account for 85% of its production costs, and truly achieve a full supply chain integration from scrap steel to medium and thick plates.

（3）Suacero

In the third quarter of 2025, Suacero's new advanced wire rolling mill in San Luis Potosi will be put into production, thereby expanding its product portfolio. The factory is designed by the Italian Danieli Group and is equipped with a 10-pass BGV rapid finishing mill (using Multidrives M2 technology), Danieli structural control device, and a wire cooling line that can achieve quenching and tempering treatment. Other facilities include a vertical coil transportation system and baler provided by Danieli's Sund Birsta Company. The factory has an annual production capacity of 500,000 tons and will produce a variety of steel types including wire mesh steel. At present, the installation project has entered the final stage.

（4） Talleresy Aceros (TYASA)

In Ixtasocketland, Veracruz, the newly built steel rolling mill in Talleresy Aceros (TYASA) is scheduled to be put into production by the end of 2025 or early 2026. The factory is provided by Danieli and will produce 350,000 tons of annual production of special steel bars in the automotive and industrial sectors to replace imports. The factory adopts advanced heating, rolling and finishing technologies, including sizing machines, rack-step cold beds and cover-type annealing equipment. TYASA's current special steel production capacity is 20,000 tons per year. Through this expansion, the company strives to become a strategic supplier to first-class automobile and machinery manufacturers in Mexico.

（5）Ternium SA

By the end of 2025, Ternium SA will start a new hot-dip galvanizing production line at a new integrated steel plant in Pesqueria, Nova Leon. This production line with an annual capacity of 600,000 tons will process hot and cold rolled steel coils with thicknesses of 4.5 mm and widths of 1854 mm. The products are used in construction and non-exposed automotive parts. The production line is equipped with an automated steel coil processing system, advanced cleaning and annealing equipment, leveling machines, tension straightening machines and comprehensive visual inspection systems, and optimizes operations through predictive modeling and automation technology. The upstream smelting and flat material rolling facilities are scheduled to be put into production in 2026, and the entire industrial chain integration of the factory will be improved.

（6） End

After all the above projects are implemented, Mexico's total steelmaking capacity will increase by about 4 million tons to about 28 million tons, while the potential production capacity of long-form rolling will increase by more than 2.7 million tons, exceeding 17 million tons.

As various new and expanded steel projects continue to advance, Mexico will further consolidate its position as a competitive steel producer in the Americas. The emphasis on supply chain localization, capacity expansion and advanced technology integration shows Mexico's intention to maintain long-term resilience and transition to industrial modernization.

5. Mexico strengthens protection of local steel industry

The Mexican government unveiled a strategy to protect and strengthen the national steel industry in May 2025 as part of its "Made in Mexico" campaign launched in June.

The Mexican Ministry of Economic Affairs said the strategy aims to protect the domestic steel industry and thus protect Mexico's employment. It is reported that as part of the new policy, importing steel products from any country now requires registration with the Ministry of Economic Affairs in advance. This registration must include the details of the steel plant that supplies the steel to meet the necessary regulatory standards. The measure is intended to prevent traders and importers from using fake registration books to bring steel into the country.

6. Mexico's industrial development momentum is good

In 2024, more than 2,000 Chinese companies moved their production bases to Mexico, covering electronics, textiles, machinery and other fields. Mexican workers’ hourly wages are $3.8, compared with US$29.5 and China’s $6.67, the cost advantage is obvious, only 12.7% of the United States and 58% of China. In addition, the freight time from Mexico to the United States only takes 3-5 days, and the convenience of logistics makes Mexico a new market entry for Chinese companies.

Mexico attracted foreign direct investment (FDI) of up to US$36.9 billion, of which the manufacturing industry accounted for 53%, mainly concentrated in industries such as automobiles, electronics and pharmaceuticals. This trend has attracted many well-known companies to invest in and build factories, such as Tesla and BMW. Tesla plans to invest $10 billion in Mexico to build a factory, with production capacity expected to reach 1 million electric vehicles by 2025. In addition, BMW also announced an investment of 800 million euros to build a battery factory in Mexico.

Mexico also benefits from the implementation of USMCA policies. The USMCA policy has enhanced the competitiveness of Mexico's manufacturing industry and made it more stable in the global industrial chain. For example, at least 75% of automotive parts need to be produced in North America, a regulation that brings new development opportunities to Mexico's automobile manufacturing industry.

It is expected that by 2026, Mexico will attract up to US$48 billion in foreign capital, and the scale of "near-shore manufacturing" will also exceed US$1.2 trillion. However, with the rise of countries such as India and Vietnam, the competitive pressure on Mexico in the manufacturing sector has gradually increased. In order to maintain a leading position, Mexico must continuously improve its technical strength and supply chain resilience.

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