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Latin America steps into 2026 navigating a steel market reshaped by Mexico’s sweeping tariff package on more than 1,400 imported categories — steel included — and by a region that spent the past year searching for firmer defenses against the influx of Chinese material.
With Mexico at the center of global steel trade shifts in 2025, Fastmarkets expanded its presence in the country to provide specialized coverage of local prices and market dynamics.
Fastmarkets launched its Mexican coverage in June 2025, starting in Monterrey, amid nearshoring trends and a rapidly changing North American tariff landscape, which has given the market clearer signals, offering much-needed structure to an increasingly complex environment — yet the broader picture remains far from settled.
Fastmarkets’ latest calculation of the steel hot-rolled coil index, delivered Monterrey, Mexico was 13,638.36 Mexican pesos ($762) per tonne on Friday January 2, down marginally from 13,688.97 pesos per tonne a week earlier on December 26.
Fastmarkets’ price assessment for steel reinforcing bar (rebar), delivered Monterrey, Mexico was 14,800-15,200 pesos per tonne on Friday, unchanged from a week earlier.
Fastmarkets’ steel hot-rolled coil index, delivered Bajio, Mexico was calculated at 14,093.88 pesos per tonne on Friday, down from 14,225.15 pesos per tonne on December 26.
Fastmarkets’ price assessment for steel reinforcing bar (rebar), delivered Bajio, Mexico was 14,700-15,000 pesos per tonne on Friday, steady from the previous week.
Across Latin America, steelmakers insist that the wave of Chinese imports has reached a structural level, rather than a temporary market imbalance.
“China now accounts for more than 50% of the world’s steel output, and this keeps expanding,” Ezequiel Tavernelli, executive director of the Latin American Steel Association (Alacero), told Fastmarkets during an exclusive interview on December 11. “Approximately 40% of the steel consumed in Latin America is imported — and most of it comes from China. From 2024 to 2025 alone, China’s share in the Latin American market increased by more than 20%, while the region’s steel production continued to decline.”
He pointed to the vast gap between China’s installed capacity and the demand from its domestic market — a mismatch Tavernelli described as the root of a “permanent export pressure” that Latin America is absorbing at increasingly distorted prices.
This distortion, according to the Alacero’s executive, has already translated into a visible process of industrial erosion. The region’s manufacturing share has fallen steadily over the past decades, with sectors such as automotive, construction, white goods and machinery losing competitiveness as subsidized imports displace domestic material.
As Tavernelli put it: “Today, we are fully supplied in primary products — minerals, soybeans, energy — but we import an increasing number of cars, components, refrigerators and machinery. This takes away jobs and delays the eradication of poverty in the region.”
The broader regional debate also revolves around strategy: should Latin America respond collectively, or should each country advance its own measures at its own pace? For Tavernelli, reality is pragmatic: integration remains desirable, but the region is fragmented into different trade agreements and uneven institutional capacities.
“Every measure helps,” he said. “We need to level the playing field. That’s the whole point.”
Tavernelli stressed that regional fragmentation is eroding competitiveness: “In Europe, for example, measures are swift and coordinated. Here, we lag behind. Two countries — Mexico and Brazil — account for 80% of the region’s anti-dumping measures.”
In his view, this creates asymmetries that allow subsidized steel to continue entering through countries with weaker rules.
There is a sense of opportunity underlying the warning signs, according to sources, and apparent steel use in Latin America has room to grow, with per-capita consumption far below that of mature economies.
Large-scale projects in energy, logistics, ports, highways and renewable capacity could lift demand. “We can compete with any producer in the world,” Tavernelli said. “What we can’t do is compete against subsidies.”
He noted that the region has a real environmental advantage, standing out for low carbon emissions and strong renewable energy capacity.
“More than 60% of energy in Latin America is renewable. Our steel has an environmental impact 25% lower than the rest of the world and more than 30% lower than China’s,” the director said. “But when we import steel, we are importing carbon.”
No country has drawn more attention than Mexico. After a year marked by US tariff shifts, volatile import flows and a constant push-and-pull between domestic supply and foreign competition, the market looks very different from where it started. With the dust settling, the central question now is: how is Mexico really doing, one year on?
In 2025, the Mexican steel industry has seen an overall decline in consumption following pressure from the US Section 232 tariffs on steel, which halted the flow of exports to Mexico’s largest trading partner. Steel consumption fell 10.5% year on year in October, according to the latest report from Mexico’s National Chamber of the Iron and Steel Industry (Canacero).
Exports to the US between January-October 2025 are down by 26.9% from 2024. The share of Mexican exports destined to the US has fallen from 77% to 57.7% during October in 2025.
Lower cost steel from Asia also pressured the Mexican steel market in 2025, but sweeping trade defense measures undertaken by President Claudia Sheinbaum’s administration have led to the decline of underpriced imports to the region, Canacero data shows.
On December 10, Mexico’s Congress approved a package of tariffs aimed at countering lower‑priced Asian steel — the latest trade measure by the government. One producer source said the move could “support the goal of regionalizing the North American supply chain, which the three USMCA countries have been working to strengthen.”
“I think they [the tariffs] are in response to Mexican industry’s request for protection from Chinese exports of overcapacity. They’re a good first step, but not enough, as Chinese export prices keep decreasing and the RMB [Chinese Yuan] is severely undervalued,” Jorge Guajardo, former Mexican ambassador to China, told Fastmarkets in December.
The ambassador also added: “[The tariffs] sets the country on the right path of putting a stop to this onslaught of Chinese exports that threaten to deindustrialize entire sectors.”
Would a 100% tariff be necessary? According to Guajardo, “at least, yes.” “There is room, momentum and incentive for domestic mills to grow,” Guajardo added.
The move brings Mexico more closely in line with the US geopolitical stance as the two countries prepare for the USMCA review scheduled for July 1, 2026.
The tariffs are expected to weigh more heavily on flat steel than on long steel, which is rarely imported. Short-term effects on flat steel prices are likely to be limited, although the automotive sector may face pressure as lower-priced material becomes less available, sources said.
Amid US pressure to curb transshipment from China and other countries, Mexico has stepped up trade actions ahead of the 2026 USMCA renegotiation, moves that sources said help align the country more closely with the US.
Market participants do not expect any impact on Mexican steel exports until mid-2026. “The USMCA review will likely open discussions around Section 232 measures on Mexican steel, but alignment will take time,” a producer told Fastmarkets.
In Alacero’s view, Mexico’s move follows a broader global trend toward tighter trade policies. Tavernelli added that Latin America should see Mexico and the United States “as opportunities for productive integration, not as rivals.”
Mexico’s role as a major hub for automotive, construction and home-appliance manufacturing continues to underpin demand, reinforcing the importance of the rebar and HRC markets in Monterrey.
In November 2025, Fastmarkets’ expanded its Mexican coverage into the Bajío region, marking the official launch of the HRC index and the rebar price assessment there.
As the central Mexican market, Bajío region is a main hub for steel market activity in Mexico due to its proximity to ports on the Atlantic and Pacific coast. The many producers in the region (one blast furnace, 12 electric furnaces, four rolling mills and over 10 big traders, according to 2025 data from Canacero), encompasses producers, distributors, service centers and many end-use consumers.
In the hot-band market, prices steadily fell from June as US tariffs pressured demand for Mexican hot-rolled coil. Prices ranged between 13,200-13,600 during July-August before hitting 12,740.01 pesos per tonne on September 11, the lowest value since the index launched.
North Mexico HRC prices hovered around 12,800-12,900 for the remainder of September through October, increasing slightly during the two-month period, with gains made by the Mexican pesos against the US dollar propping up the prices slightly. But demand remained lackluster and activity was minimal during the timeframe.
HRC prices held mostly stable around 12,950-13,050 in November as subdued demand kept the market stagnant, but rising US hot-band prices led Mexican producers to push through a $25 per tonne during the first week of December. Prices reached 13,270.36 pesos per tonne, the highest since August.
Since the launch of the central Mexico hot-rolled coil assessment in November, prices were mostly steady in line with North Mexico values. But they dropped sharply from 15,051.15 pesos per tonne on November 20 to 14,122.49 pesos per tonne on December 1, weighed down by weak holiday demand.
Hot-rolled coil prices are expected to rise in 2026 as the Mexican tariffs curb imported supply and typically seasonal patterns increase demand in the new year, sources say. Mills have already elevated prices by $50 per tonne in December on supply constraints, which should be exacerbated by the tariff implementation on January 1.
Mexico’s rebar market struggled through most of 2025 to translate mill-led price hikes into sustained gains, with demand capped by weak construction activity and political uncertainty.
Mills repeatedly pushed for increases of 1,000–1,500 pesos per tonne through midyear, but sluggish demand and aggressive distributor offers kept Monterrey mostly around 13,600–14,200 pesos per tonne, while the Bajío market held slightly lower on ample regional supply.
A brief rally in late July — triggered by ArcelorMittal’s force majeure at its Lázaro Cárdenas long-steel unit — lifted prices close to 15,000 pesos per tonne, but the move quickly faded as restocked inventories and soft consumption capped momentum.
Through August, September and early October, rebar values gradually slipped back toward 13,700–13,900 pesos per tonne despite rising scrap costs, underscoring that fundamentals, not inputs, were dictating direction.
Conditions shifted only toward year-end. Seasonal restocking, infrastructure work linked to the 2026 soccer World Cup and tighter supply allowed mills to regain leverage, pushing prices higher in late November and December.
The year closed with mills largely sold out into early 2026 and discussions of further increases under way — signaling that the market entered the new year from a position of tightening supply rather than weakening demand.
For Alacero, price sustainability will depend on the ability to contain unfair imports.
“We have to do everything necessary to maintain the productive chain in the region. If we do not implement the right measures now, we run the risk of losing everything,” Tavernelli warned.
Heading into the new year, Mexico enters at a turning point for its steel market, shaped by growing political pressure to curb Chinese material and reinforce North American supply chains.
Brazil’s steel market in 2025 was shaped largely by a renewed surge in imports, particularly from China, which continued to place pressure on domestic prices and margins.
Market participants repeatedly flagged the volume and pricing of imported flat and long products as misaligned with local cost structures, reinforcing concerns over unfair competition and the erosion of domestic producers’ market share. In late December, the Brazilian steel industry association Aço Brasil reinforced its calls for protection.
“Given the scenario we see of several countries adopting measures [to protect themselves from imports], there will be increasing trade diversion, and our concern is that this material will come to Brazil,” André Johannpeter, chairman of the board of Gerdau and chairman of the board of directors of Aço Brasil, said during an exclusive press conference in São Paulo on December 16.
Market participants closely monitored discussions around potential new anti-dumping measures and adjustments to trade instruments, although both domestic producers and importers said the investigation processes lacked visibility and clear timelines.
“The worst part is not knowing anything, it’s this uncertainty about what will or won’t happen with anti-dumping measures. If we knew, at least we could play by the rules of the game,” a trader source told Fastmarkets.
As the market heads into 2026, sentiment remains closely tied to macroeconomic conditions — such as Brazil entering an election year — and trade policy signals, with market forecasts pointing to growing apparent steel consumption in the country and the prospect of greater clarity on new anti-dumping measures.
Other Latin America’s steel markets also faced a year of structural strain in 2025, reinforcing Alacero’s warning that the region is undergoing a broad industrial retreat.
“The region’s most important economies — Chile, Brazil, Argentina, Colombia, Peru and Mexico — have lost 4% of their industrial power between the 1990s and now,” Tavernelli, Alacero’s director, said. “When we look at each country, Chile, which has just lost its Huachipato steel industry, lost 7.8% in industrial value added; Brazil lost 7%. That is a lot — we are losing manufacturing capacity.”
Chile felt this most acutely after the closure of Huachipato, its largest mill. “Any industrial closure is bad news,” Tavernelli said, calling the shutdown a significant blow to regional sovereignty.
Despite the setback, he noted that Chile retains technical capability through remaining producers such as ASA and could return to higher-quality domestic output if long-term investment materializes.
Argentina took a different path by easing export duties, a move Tavernelli framed cautiously as finding “an intelligent equilibrium”, considering its historically closed economy, in its gradual market opening, stressing that the country’s industry remains competitive but requires coordination with government policy. Local producers welcomed the fiscal relief, citing improved margins and an opportunity to regain competitiveness abroad.
Colombia, meanwhile, accelerated its path toward industrial diversification. Besides lobbying for exemptions to the US 25% tariff — which local chambers warned would distort input costs and undermine competitiveness — the country also imposed steep anti-dumping duties of up to 94.64% on Chinese coated products and advanced plans for its first flat-steel mill.
The initiative, long discussed and now formally under feasibility review, signals a structural ambition: reducing reliance on imported flat steel, which currently covers 100% of domestic demand.
Peru followed a similar defensive trajectory, launching multiple anti-dumping investigations in early 2025 — including probes into welded pipe, wire rod and stainless steel sinks from China — underscoring its increasingly assertive stance after imports surged and domestic margins eroded.
Bolivia, typically small in regional production, opened its first steelmaking complex at Mutún, aiming to replace up to half of its rebar and wire rod imports. Although modest in scale, the project exemplifies Latin America’s broader shift toward strategic self-sufficiency and industrial recovery after years of erosion, sources said.
Across all these developments, Tavernelli said the central theme is common: “We are all losing industry — all of us. That is why every country must take the measures necessary to defend its market. If one does nothing, the entire region feels the impact.”
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