Ternium sees demand stabilizing in Mexico

Ternium SA expects steel demand in Mexico to keep improving through the second quarter as destocking fades and new industrial policies take hold.

Executives on a first-quarter earnings conference call on Wednesday said the commercial market is leading the recovery, supported by tighter trade defenses and early activity on infrastructure projects.

Apparent steel demand in Mexico declined about 10% in 2025, but the Luxembourg-based Latin American steelmaker said it is now seeing normalization across the supply chain.

Ternium highlighted that Mexico has been taking steps to align with US trade policy, including imposing tariffs on non-FTA steel, advancing new measures against unfair imports from Asia, and signing an agreement with domestic producers to prioritize Mexican steel in public procurement. These steps are now redirecting volumes toward local mills, according to the company.

“I don’t expect the investments to start in the next quarter or the following,” CEO Máximo Vedoya commented. “But I think that by year-end, all this effort that the government is doing will have an impact in demand.”

“Taken together, these policies support our expectation of a recovery in Mexican steel demand,” he added.

He also pointed to Plan México, which aims to increase domestic content and strengthen regional supply chains. Ternium expects these policies to support demand as the year progresses.

Vedoya said Mexico’s recent trade actions represent a structural shift aimed at reducing dependence on Asian steel. He expects these measures to strengthen the competitive environment once US-Mexico Section 232 issues are resolved.

Regarding the upcoming USMCA review, the CEO anticipates a renewal with stricter automotive rules of origin. But he warned the timeline may extend beyond July. He said Mexico is pushing for relief from Section 232 steel and automotive tariffs during the negotiations.

“There is no compatibility between Section 232 and USMCA… it doesn’t make sense,” Vedoya stated.

An analyst asked whether Ternium would consider building a production facility in the US to obtain Section 232 tariff relief. “We are not thinking in making some production or increased production in the US now. We don’t have that as a plan today,” Vedoya announced in response.

Pesquería ramp-up

Executives on the call provided an update on the status of its Pesquería complex. The ramp-up of the new 1.6-million-ton-per-year cold-rolling mill and 600,000-tpy galvanizing line is running ahead of schedule, they said. Both lines are expected to reach near full capacity by October. Other finishing lines and a 550,000-tpy push-pull pickling line are now operational.

Work on the new slab mill is also advancing as planned. The new 2.6-million-tpy steel shop and 2.1-million-tpy DRI module are scheduled to begin ramping up late this year and early next year. Full automotive qualifications are targeted for 2028.

Ternium said the upstream expansion will reduce its reliance on purchased slabs. Slab prices have risen due to higher fuel and raw material costs. The company continues buying slabs on the market, though volumes are lower due to internal supply from Usiminas in Brazil, said Vedoya.

Laura Miller

Laura Miller is a reporter and editor for Steel Market Update. She has held various editorial positions with steel industry publications, associations, and mills since 2007. She joined the SMU team in 2022. She is a member of the Association of Women in the Metal Industries and a past-president of the AWMI Pittsburgh Chapter. She holds a BA in Latin American Studies from Edinboro University of Pennsylvania.