Steel and aluminum tariff

The Ministry of Economy (Mineco) confirmed that 25% tariffs approved by the United States to all imports of steel already aluminum, entered into force on March 12, 2025.

In the case of Guatemala, steel remains with the 25%rate, the same that had already been imposed in the first management of US President Donald Trump, while aluminum went from having a 10%rate at a rate of 25%, confirmed the Minister of Foreign Trade of Mineco, Héctor Marroquín.

The official explained that before 2018, steel imports and Guatemalan aluminum to that country were zero of tariff, but from that year, under disposition 232, the United States imposed 25% tariff for steel. Although there were some countries that had been excluded at the time, however, the disposition of 2025 is general for all countries.

And, for aluminum it was set at 10% in 2018, and with the provision that charged validity on March 12 is 25%.

This is a punitive tariff for countries that did not have it or that had a lower rate and now they have to climb, he explained.

“Our reading is that the tariff does not add to the rate that was already applied, but rises to 25%,” he added.

Asked about the effect for export levels from Guatemala, Marroquín, mentioned that steel exports decreasing substantially from the regulations of 2018, and in this context it is difficult for that situation to be reversed because the conditions have been modified, but not to give a preference to greater access, but on the contrary.

Trump protectionism

According to what they have said, the objective of the new provisions implemented are precisely to protect the US import market and seek to return to promote the industry of their country that in many sectors due to the same evolution and the integration of global value chains became dispersed in different parts of the world and what is being sought is to concentrate production in their country for consumption and eventually for export, perhaps, he added.

Guatemalan steel and aluminum that is imported to the United States no longer had tariffs based on the treaty of free trade between the United States, Central America and the Dominican Republic (DR-CAFTA).

When talking about tariffs in general, the official explained that a unilateral decision to place tariffs on a product can affect the FTA. Asked if that treaty was affected in 2018 when the United States imposed tariffs on these products and if any action was placed, he said that the country has not filed any demand.

He added that now that they are in the Administration, they collected information about what was done at the time, and it was observed that a series of actions were taken to understand the disposition, but that at the time the authorities of the Ministry of Economy practically accepted that provision, although they activated with a series of approaches with the authorities of the United States, office of the US commercial representative of the USA (UST), of the Department of Commerce.

Protect quality

For the Guatemaltec metallurgy industry, the stage does not change much with this new disposition since the effects were lived in the first implementation of the 2018 tariff when Guatemala Metallurgy union attached to that camera.

They explained that this commercial affectation occurred despite the fact that the DR-CAFTA agreement guarantees the exemption of tariffs in the export of steel and aluminum products to the United States, remembering that the measure had already been implemented by the United States government since March 2018, with an additional tariff of 10% and 25% respectively to imports of aluminum and steel products from all over the world under section 232 of the Commercial Expansion Law of 1962; arguing national security reasons.

The industry sought market diversification, indicated when consulted about what the sector can do.

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– Rosa María Bolaños (@Rollanos_PL) March 11, 2025

“It is important to highlight that Guatemala has a consolidated steel industry,” and according to Mineco, interannual exports grew 51% in 2024, the executive added.

It is added that the metallurgical industry generates around 50 thousand direct and indirect jobs in the country, and has a 3.9% contribution to GDP.

The CIG and the union, consider that having a national robust steel industry represents an indispensable factor for industrialization, however, they also mention that it faces several challenges, such as the lack of regulations and regulations that regulate the quality of unfair trade products and practices.

Therefore, they said, it is important to continue looking for the relevant approaches with the corresponding authorities of the government on duty “to promote regulations for the quality of construction products and, above all, to imports from different countries, with the objective that the products used for constructions in the country can comply with international quality regulations and standards in the matter”.

The CIG and the union also expose that the imposition of tariffs by that North American country will cause exporters from other countries that prior to that measure made their shipments to the United States, turn to see Guatemala to market. Therefore, they consider that “the competition of products of Guatemalan origin that lack effective protection” would be further violated, and as a country it must be ensured that the imported product meets the same national manufacturing standards since only this will ensure safe constructions for Guatemalans.

They expect more offer and what prices go down

On the other hand consulted Erwin Sanabria Ríos, vice president of the Guatemalan Importers and Steam Transformers (Gremat), attached to the Guatemalan Chamber of Commerce, said that in the country most companies in the steel sector are importers and transformers of different products depending on the industry in question.

Therefore, he said that being a mainly importer country the tariffs that the United States is putting, the impact will have little or void.

He indicated that some industries send material that was used as recyclable from the United States plants to continue their manufacturing processes.

Sanabria said that it has been analyzed in the trade union, that the steel offer of all producing countries will be re -infocated in other places where to place their products, so, for importing countries such as Guatemala, they could benefit them if there is an increase in offer because it could derive in that some prices experience modifications towards decline, although it said that it is very early to predict if that will be the behavior.

The Executive added that there is uncertainty because the president of the United States constantly changes their decisions and uses tariffs as a means of pressure.

However, “the expectation is that at least the world prices of steel should be maintained with the stability they have been at this time,” he added.

The union members buy steel outside with prices and quality that they need depending on the market line, so they import it and transform it, they also commercialize it in the local market or the Central America market, Sanabria explained. There are producers of several product lines such as cooling equipment, construction companies, warehouse construction, roof covers.

Sanabria said they consider that the new tariffs are punitive, that is, at the existing rate, the new 25%is added. This concept has also been handled by the firm EY. However, now the Mineco explains when implementing the new tariff rates, both products are 25%.

The export of Chinese steel worries

For the Metallurgy Industries Guild, attached to the Guatemalan Chamber of Industry, not only is the competition generated by the tariff imposition to other countries to steel and aluminum, but the unstoppable export of Chinese steel to Latin America, which in 2024 reached US $ 14.2 million, registering an increase of 129% compared to 2019, derived from the fact that the diversion of steel Potentializes countries that do not have defense measures such as ours.

The affected countries must look for new markets, leaving Central America as an option, especially Guatemala. In addition to this, the actions implemented by countries such as Mexico, Brazil and Chile to defend their industry against unfair trade, will imply a greater diversion of Chinese steel to regions such as ours, causing the closure of factories, production in fall, financial losses and the destruction of the value chain of the metalworking industry.

Likewise, it would imply more imports of products that do not meet the quality standards necessary for a seismic country like ours. Guatemala needs to industrialize to develop, and evidence shows that industrialization and development depend critically on a thriving steel sector. That is why we consider that the defense of the national industry is extremely important.

In figures

• In 2024, Guatemala exported to the United States steel and aluminum products for US $ 21.3 million. The main exported products include waste and aluminum waste and its manufactures, for US $ 9.9 million; flat iron and steel products without alloy, for US $ 8.5 million; and hollow tubes and profiles, soldiers, square or rectangular section of iron and steel, which added US $ 2.4 million, according to Mineco data.
• It also mentions other iron and steel manufactures, which totaled US $ 0.2 million, as well as hollow tubes and profiles, soldiers, circular section of iron and steel, with a value of US $ 0.1 million.
• While the country imported from the United States, US $ 79.8 million in steel and aluminum. According to the Mineco, these inputs are intended to supply various industries and services, such as the metallurgical and metal-mechanical industry, production of metal construction materials and household items, machines and domestic use devices.
• Imported supplies are used to make a variety of products, among others: Bars for the elaboration of bars of different sizes, zinc wire, wires of various thicknesses, profiles in L, H and T, sheets of different cool rolled thicknesses, and black sheet for the production of galvanized sheets with zinc. The diversification of imports in these industries allows us to explore new markets to supply the local supply chain, thus preventing the national industry from being affected by an increase in prices.