Category: Mexico

“It is not by imposing tariffs that problems are resolved, but by talking and dialoguing,” President Claudia Sheinbaum said.

Muted demand from the auto industry took a particular toll later in the year.

The whole SMU team is packing up our laptops and our SMU polos/cardigans, loading up the PowerPoint slides, and preparing to make the trek down to Florida for the Tampa Steel Conference. There will be plenty to talk about!

The benefits from higher tariffs are speculative and unproven. The disruptions caused by tariffs and other trade restrictions are better documented and cannot be rationally denied. For the tariffs to be good policy, the Trump argument must therefore be sure that the benefits to the US exceed the cost of these disruptions. Otherwise, we have madness masquerading as policy.

The Trump administration will implement 25% tariffs on Canada and Mexico and 10% tariffs on China, according to a White House fact sheet and executive orders circulated on Saturday. The administration said that it would tariff “energy resources” from Canada at a lower rate – 10%. The tariffs will go into effect at 12:01 ET on Tuesday, according to an executive order. The White House documents made no mention of exemptions.

The scrap and metallics market has reacted to the tariffs potentially being implemented on our neighbors to the north and south. These could have a serious impact on the market, especially on Canada, unless these products are exempted.

On Jan. 18, Teck Resources announced that it expects its Trail smelter in Canada to produce 190,000 to 230,000 metric tons (mt) in 2025, down 10-25% from its 256,000 mt output in 2024. The company announced that the lower output was to maximize profitability and value amid the current tightness in zinc concentrate availability relative […]

North American auto assemblies dropped in December, a sharp 22.6% fall below November, reaching the lowest mark in over three years. Assemblies were also down 5.7% year on year (y/y), according to LMC Automotive data. December’s assemblies reached the lowest total since July 2021. Sentiment remains tempered as carmakers continue to downgrade and adjust vehicle […]

Hitting Canada with a 25% tariff could allow imported goods from other origins at proposed 10%-20% tariffs.

US light-vehicle (LV) sales jumped to an unadjusted 1.49 million units in December, a rise of 9.6% from November and 2% from a year ago, according to data from the US Bureau of Economic Analysis. On an annualized basis, LV sales were 16.8 million units in December, up from 15.6 million units the month prior […]

From one group of folks, I’ve heard that Trump might not wait until Feb. 1 – the date he threatened on to place tariffs on China, Canada, and Mexico. They say he could act as soon as Friday. And then there are those who don’t think anything will happen before April 1. That’s the deadline for Commerce, Treasury, and USTR to submit key reports on “America First Trade Policy” to President Trump.

Midwest HRC indices have been stuck in a tight range since last summer with the weekly CRU Midwest HRC price spending the past 32 weeks between $656 and $714 per short ton (st). The rolling Midwest HRC future has been rangebound between roughly $650 to $800 since last June. The rate at which the price of HRC futures move over a certain period or “volatility” has compressed dramatically over the past few months.

The Canadian Steel Producers Association (CSPA) has urged Canada to engage with the US administration to avoid the tariffs threatened by the Trump administration by Feb. 1. “The imposition of tariffs on Canadian goods will have an incredibly disruptive impact on our integrated North American supply chains and on our workers and their families,” François […]

USMCA is option 1 but will cost more or not be big enough

With construction seasonally soft, the flatbed market remains softer than the other main trailer types.

Mexican steel trade association Canacero said US steel exports represent “a threat to the Mexican steel industry.” Canacero also backed retaliatory measures if President Trump enacts 25% tariffs on Mexico by Feb. 1.

Earlier this week, SMU polled steel buyers on an array of topics, ranging from market prices, demand, and inventories to imports and evolving market events.

Trump made a clarification in a speech on Monday. Previously, he had declared the word “tariff” the most beautiful word in the dictionary. No longer.

“More needs to be done to ensure that these illegally dumped and subsidized imports do not continue to distort the American market in a road profitability," Nucor's CEO said.

Nucor Corp. posted sharply lower fourth quarter earnings on Monday driven in part by lower average selling prices at its steel mills. The Charlotte, N.C.-based steelmaker also warned that first-quarter results might not be much better in commentary released with earnings data. But Nucor said that it expected better times later in 2025. It also hinted at the possibility of ramped up trade restrictions – including more stringent Section 232 tariffs.

A majority of SMU survey respondents expect US prime scrap tags to land sideways in February. In our most recent survey last week, 51% said US prime scrap prices would be flat next month, and 46% anticipate rising prices; the small remainder think prices will fall. Recall that the January ferrous scrap market settled before […]

Less-than-fair-value investigations The US Commerce Department has agreed to postpone preliminary decisions in the corrosion-resistant steel (CORE) antidumping duty (AD) investigations. Commerce said in a Federal Register filing that it will now issue initial AD margin determinations by April 3. The deadline had previously been Feb. 12. The extension comes after domestic petitioners requested earlier […]

There is no doubt pig iron will be needed to fuel the expansion of flat-roll capacity in the US and Canada. Where will it come from? How much will it cost? What will be the quality? Is it a good business to produce merchant pig iron? The US imports between 4-6 million metric tons (mt) per year of […]

President Donald Trump on Sunday hammered Colombia with 25% tariffs and threatened to increase them to 50%. Trump in a post on Truth Social said he took the action not because of a trade dispute but because the South American nation had refused to accept planes carrying deported immigrants. The president also cited "national security" concerns, just as he did to justify 25% Section 232 tariffs on steel in his first term. Even the 50% threat echoes his first term. Turkish steel, like that of most nations, was assessed a 25% tariff in March 2018. Trump doubled Turkey's tariff to 50% via a tweet in August of that year over a matter unrelated to steel.

Day One of the second Trump administration did not bring tariffs, but it did signal that tariffs, and other major trade actions, are not far off.

Executive orders, LME volatility and more

We surveyed many of you this week and asked what you wanted to see from the new Trump administration. Responses were varied but fell largely into three groups: tariffs and trade policy, the Nippon-U.S. Steel deal, and those who are concerned about too much government sway in steel. Some also expressed hope that President Trump would continue the infrastructure spending that began under former President Biden.

Alan Kestenbaum was the featured speaker at SMU’s Community Chat on Wednesday, where he discussed US Steel, tariffs, climate policy and other topics.

Steel Dynamic Inc.’s profits narrowed in the fourth quarter of 2024 on lower prices, import competition, and continued losses from its sheet mill in Sinton, Texas. The Fort Wayne, Ind.-based steelmaker said results also suffered from an unplanned outage at its sheet mill in Butler, Ind. That reduced sales volumes by approximately 50,000 tons.

The US scrap market for February has a lot of moving parts that need to mesh before an accurate picture can emerge. However, the general opinion for next month is an increase of at least $20 per gross ton (gt), according to sources contacted by SMU. Among the issues are winter weather decreasing scrap flows, […]