As in his first term (2017-2021), he US President aspires to protect the American industry of steel undergoing imported metalwith customs rates of 25% that govern since March 12.
The United States imports 25 million tons per year of metal. Canada is its main individual supplier, followed by Brazil and Mexico, with products for other industries such as automaker or construction.
The American industry “needs to supply” products with “special technologies (…), steels that has always bought in Latin America,” said Ezequiel Tavernelli, executive director of the Latin American Steel Association (winger) at AFP.
Therefore, in a framework of overproduction of steel in the world, with China at the head, tariffs will be a great distortion for the market: “The only thing it would bring is a flood of steel due to commerce diversion of that steel that went to the United States (…) to less protected regions (and) with less defense capacity”, such as Latin America, the executive said.
To explain the severity of the threat, he recalled that in 2000 China exported less than 100,000 tons of steel to Latin America. “Today is above 14 million. (Growth) is exponential,” he said.
The production of steel in Latin America has been falling for three years. In 2024 the decline was 3.6% to 56 million tons in a consumption of 73 million. The China part in the total used in the region is growing.
For Trump tariffs Latin American producers would not only lose admission to the United States. The loss of market parts against Chinese steel in their own countries would also be accentuated.
When it rains, flood
The numbers are raw.
The world has a production capacity of 2,480 million tons per year. Of that total, China represents 1 thousand 140 million, more than 45%. The Asian giant uses most, but there are plenty of 140 million tons that go to the international market at dumping prices, according to Alacero.
“One of the countries that has the greatest overcapacity and floods our steel markets is China, and also does it in a unfair way,” with prices below the cost thanks to official subsidies ranging from energy to credits, Tavernelli remarked.
23% of the steel produced in excess in the world comes from China.
In September of last year, the Chileans lived in their own flesh the impact of this situation that Tavernelli described with concern: Huachipato, the largest steel industry in the country, turned off their furnaces. In a matter of hours, with the smoke that stopped leaving the chimneys, almost 75 years of history were volatilized.
He did not reach with the surcharge resolved by the authorities. Chinese steel is 40% cheaper than Chilean. The competition became impossible.
Work as a team
Acerero argued that the “regionalization” of the production chain, that is, that the United States appeals to the steel of its neighbors, is “the best defense action against the unfair trade in China and the countries of Southeast Asia.”
Or, as the Vice President of Brazil, also Minister of Development, Industry, Commerce and Services, Geraldo Alckmin, the objective is the “economic complementarity.” Brazil, like Mexico, negotiate alternatives to avoid Trump tariffs, a path that has already worked during their first presidency.
To read more: what are tariffs, how they work and how they can impact their purchases
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 pointed out that “the regional benefit must be a priority before the threat of the excess capacity of China and the Southeast Asian.”
Likewise, the Argentine Steel Chamber (CAA) said that although it includes “the need to establish defense measures against unfair competition against China’s advance as the main steel producer in the world, the response must be coordinated.”
In this context of tension, the risk is that there are more cases such as Huachipato, “from companies with history, with years of production, with great category, (which) lose and have to close,” Tavernelli warned, who insists on working coordinatedly in the Americas to avoid it.