Ternium Mexico logs record volumes in Q3 as Pesqueria expansion ramps up

During the third quarter, Luxembourg-based Ternium achieved record-high sales volumes in Mexico and reached key milestones at its Pesqueria industrial center, the largest project in the Latin American steelmaker’s history.

Third-quarter earnings and outlook

In its quarterly earnings report on Wednesday, Ternium reported a 14% year-over-year decline in Q3 sales to $4.48 billion. At the same time, net income jumped to $93 million after significant losses of more than $700 million in both the previous and year-ago quarters.

Quarterly profits of $93 million were significantly higher sequentially and compared to last year. Affecting those earlier quarters were litigation expenses and charges related to its increased stake in Brazilian-based Usiminas, respectively.

A healthy Mexican steel market helped push steel shipments to a record high of 2,167,000 tons in the quarter, Ternium said. In Q4, it anticipates a seasonal decline in shipments but improved margins.

CEO Maximo Vedoya has confidence in the company’s 2025 performance.

“I believe our main markets will offer several opportunities for our company with the strength of the neutral market in Mexico, the recovery of steel consumption in Brazil, and the significant reforms to Argentina’s economy,” he said on a conference call on Wednesday.

He added that, with lower raw material and slab costs, margins should gradually improve throughout the year.

Pesqueria project update

The continued ramp-up of Ternium’s Pesqueria industrial center also assisted in the record quarterly shipment level.

The project’s new 550,000-ton-per-year (tpy) pickling line and three of five finishing lines began operating in Q3’24. Vedoya said that the two remaining finishing lines will start up in the next two months.

Work on the 600,000-tpy galvanizing line and 1.6-million-tpy cold-rolling mill is progressing steadily. Vedoya said the galv line will start operating at the end of 2025 and the cold mill in early 2026.

Ternium will begin making slabs in Mexico in mid-2026. Construction work continues on the 2.6-million-tpy slab facility in Pesqueria. Vedoya said that once completed, it will ensure a steady supply of slabs for downstream processing and reduce its dependency on external suppliers.

Vedoya noted that the company is highly focused on completing the Pesqueria project in the next two years. He said it’s the biggest project in Ternium’s history and will be the first steel shop of its kind.

Ternium was formed in 2005 after the consolidation of Mexico’s Hylsa, Argentina’s Siderar, and Venezuela’s Sidor. It now operates 18 production centers in Mexico (its main market), the US, Argentina, Brazil, Columbia, and Guatemala, manufacturing various flat and long steel products, as well as welded tubing.

Election clarity and moving forward

Vedoya was upbeat about the clarity the outcome of the US presidential election provides and the opportunities a second Trump administration will offer.

He pointed out that Mexico also has a new presidential administration, and it’s just a month into the job. Claudia Sheinbaum was sworn in as the country’s 66th president on Oct. 1.

“So, I think that’s something good because now people can start talking and can start working together,” he said.

Both administrations share concerns about China’s overcapacity and unfair trade practices, presenting a prime opportunity to strengthen the North American supply chain, he said.

As most regions of the world have already started implementing actions against China, Vedoya believes regional markets will be critically important in the future.

“The North American region is a very competitive region to produce steel, especially low-carbon intensity steel,” he remarked.

Additionally, he emphasized that many companies here, Ternium included, are investing in new capacities and will be “able to better supply all the needs of the region in a competitive way.”