Steel in Mexico Global vs Local Outlook Analysis¶
Global vs Local outlook¶
A comparison of the global and local outlooks for the steel value chain reveals several areas of convergence and divergence in trends and challenges for 2024 and 2025. Globally, the steel market is expected to experience a modest recovery in 2025 after a decline in 2024, driven by a rebound in developed economies like the US and EU, and continued strong growth in regions like India and Southeast Asia. [2, 5] However, overall consumption volumes are projected to remain below pre-pandemic levels. [1, 7, 13] Persistent economic uncertainty, high interest rates, and geopolitical tensions continue to weigh on demand in various regions, particularly in the construction and automotive sectors in Europe. [1, 7] Decarbonization and digitalization are significant global trends shaping the future of the steel value chain, driving investment in low-carbon technologies like EAF and hydrogen-based production, and increasing automation. [6, 14, 9] Supply chain restructuring and diversification of suppliers are also anticipated globally. [9, 15]
Locally, the Mexican steel industry's outlook is closely tied to domestic demand, fueled by infrastructure plans and the near-shoring of automotive supply chains. [Value Chain Report on the Steel Industry in Mexico] While facing challenges from import competition and energy costs, Mexican producers are strategically investing in capacity expansion and modernization, particularly in EAF technology due to abundant scrap availability. [Value Chain Report on the Steel Industry in Mexico] The focus on recycling and circular economy practices aligns with the global push for sustainability, though the pace and specific approaches may vary. [Value Chain Report on the Steel Industry in Mexico, 6] Mexico's strong ties to the North American market, particularly the US, influence its trade dynamics and investment decisions, contrasting with shifts in global trade flows away from China in some regions. [10, 12] The financial distress of a major local player like AHMSA represents a specific local challenge not mirrored as a widespread issue globally. [Value Chain Report on the Steel Industry in Mexico]
In essence, both global and local outlooks point to a challenging but potentially recovering market in 2025, with sustainability and technological advancements as key drivers. However, the specific regional economic conditions, trade relationships, and internal industry structures create distinct nuances in the trends and priorities observed in Mexico compared to the broader global landscape.
Trends detailing¶
| Trend | Global Outlook (2024-2025) | Local Outlook (Mexico, 2024-2025) | Similarities | Differences |
|---|---|---|---|---|
| Steel Demand | Modest recovery expected in 2025 after 2024 decline; driven by US, EU, India, Southeast Asia recovery; below pre-pandemic levels. [2, 5, 1, 7, 13] | Domestic consumption driven by infrastructure and near-shoring; apparent consumption impacted by imports. [Value Chain Report on the Steel Industry in Mexico] | Expectation of recovery in 2025. | Drivers of demand (near-shoring in Mexico vs. broader regional recovery globally); impact of imports on apparent consumption is significant locally. |
| Production Technology | Increasing adoption of EAF and hydrogen-based production for decarbonization; BF-BOF remains in cost-sensitive economies. [6, 8, 14] | Predominantly EAF route (93.5%); investments in new EAF capacity. [Value Chain Report on the Steel Industry in Mexico] | Shift towards EAF technology. | High existing reliance on EAF in Mexico; specific investments in EAF capacity locally. |
| Raw Materials | Tight supply of high-quality iron ore and metallics; increased regionalization of scrap; focus on securing supply. [3, 8] | Abundant scrap availability (local advantage); reliance on imported coking coal; challenges with scrap quality (copper content). [Value Chain Report on the Steel Industry in Mexico] | Importance of securing raw material supply. | Abundant local scrap (Mexico) vs. global concerns on high-quality ore; local scrap quality challenges. |
| Sustainability | Decarbonization through low-carbon technologies (hydrogen, EAF); increasing recycling; environmental regulations (CBAM). [6, 9, 14] | Scaling recycling infrastructure; accelerating energy transition (renewables for EAF); environmental compliance challenges (CBAM impact on exports). [Value Chain Report on the Steel Industry in Mexico] | Growing importance of sustainability and recycling; impact of environmental regulations. | Specific local investments in renewable energy for EAF; focus on scaling existing recycling infrastructure. |
| Supply Chain & Logistics | Supply chain restructuring and diversification; lead times expected to stabilize. [9, 15] | Logistics bottlenecks (rail congestion, highways); importance of efficient transportation. [Value Chain Report on the Steel Industry in Mexico] | Focus on supply chain efficiency. | Specific local infrastructure and logistics challenges. |
| Market Competition | Intense rivalry due to imports and domestic players; impact of geopolitical factors. [Value Chain Report on the Steel Industry in Mexico, 10] | Moderate to high rivalry among domestic players; significant pressure from imports; anti-dumping cases. [Value Chain Report on the Steel Industry in Mexico] | Presence of intense competition from imports and domestic players. | Specific local anti-dumping cases; impact of a major player's financial distress. |
| Investment Flows | Focus on capacity expansion, modernization, and green technologies. [9, 14] | Significant investments in new mill capacity, EAF integration, and downstream processing; focus on domestic market and near-shoring. [Value Chain Report on the Steel Industry in Mexico] | Investments aimed at capacity expansion and modernization. | Strong link between local investments and near-shoring opportunities; specific investments in EAF and downstream capacity locally. |
| Key End-Use Sectors | Construction, automotive, energy, machinery; uneven recovery across sectors and regions. [1, 7, 5] | Construction, automotive, energy, machinery, appliances; driven by infrastructure plans and near-shoring. [Value Chain Report on the Steel Industry in Mexico] | Similar key end-use sectors driving demand. | Influence of local infrastructure plans and near-shoring on specific sector demand (automotive, construction). |
References¶
Cámara Nacional de la Industria del Hierro y del Acero (CANACERO). “Comunicado: Reconocimiento a la Secretaría de Economía por negociaciones con EE. UU.” https://www.canacero.org.mx/ DEACERO. “Proceso de producción del acero en México: paso a paso.” https://www.deacero.com/es/blog/proceso-de-produccion-del-acero-en-mexico Mexico News Daily. “Mexican steel confirms US $8.7 billion investment.” https://mexiconewsdaily.com/business/mexican-steel-confirms-us-8-7-billion-investment/ RC Racks. “Manufactura del acero.” https://www.rcracks.com/blog/manufactura-del-acero Thermopanel México. “Descubre el proceso de fabricación del acero y sus fases.” https://www.thermopanel.com.mx/blog/proceso-fabricacion-acero Ternium México. “Industria del acero: generador de empleo en México.” https://mx.ternium.com/es/sala-de-prensa/noticias/industria-del-acero-generador-de-empleo-en-mexico Ulbrinox. “Proceso de fabricación del acero inoxidable.” https://www.ulbrinox.com/blog/proceso-de-fabricacion-del-acero-inoxidable Max Acero Monterrey. “Ciclo de vida del acero.” https://www.maxacero.com.mx/blog/ciclo-de-vida-del-acero One Planet Network. “Metalmecánico: diagnóstico de la cadena de valor.” https://www.oneplanetnetwork.org/ ResearchAndMarkets. “Mexico Steel Industry Research Report 2023-2032.” https://www.researchandmarkets.com/reports/steel-industry-mexico Ministerio de Producción, Argentina. “Informes de Cadenas de Valor – Acero.” https://www.argentina.gob.ar/produccion/observatorio/estudios-sectoriales Dialnet. Gómez-Martínez, J. (2016). “El estilo de gobernanza en la cadena de valor de la industria del acero en México.” https://dialnet.unirioja.es/ ResearchGate. García-López, R. (2020). “Los impactos de sostenibilidad en la cadena de valor de la industria del acero en México.” https://www.researchgate.net/ Eurofer. Economic and steel market outlook 2024-2025, fourth quarter. (2024-10-29). worldsteel. worldsteel Short Range Outlook October 2024. (2024-10-14). McKinsey & Company. The resilience of steel: Navigating the crossroads. (2023-04-18). Atradius. Metals and Steel Industry Trends May 2024. World Steel Association. Global steel demand outlook for 2024 and 2025: Challenges and recovery prospects. (2024-10-14). Wood Mackenzie. Challenges and opportunities for the steel value chain. (2024-08-21). Avocet Steel. Steel Industry Outlook for 2024-2025: Economic Trends and Strategic Insights for Precision Metals. (2024-10-25). Fastmarkets. 2025 crude steel production forecast: Global trends and insights. (2025-04-08). worldsteel. Megatrends and their influence on the global steel industry. (2023-03-31). ArcelorMittal. Steel Thoughts: Maximising value from an ever-evolving global steel market. (2024-06-20). Eurofer. Economic and steel market outlook 2025-2026, first quarter. (2025-02-06). Eurofer. Economic and steel market outlook 2024-2025, fourth quarter. (2024-10-02). Green Steel Transformation. Hydrogen-Based Production. India's Green Steel Mission. EU's CBAM.