Mexican HDG end-users refuse to absorb potential price increases

Thursday, 13 February 2014 01:07:25 (GMT+3)   |  
       

Mexican domestic hot dipped galvanized (HDG) prices fell US$11/mt in the last three weeks to reach US$922/mt ex-mill.

In the domestic market, HDG, like other flat steel products, behaved inversely to expectations after the announcement of a 5 percent increase in plate prices a few weeks ago. End-use consumers sectors were not willing to absorb any increases.

Some automotive sector sources say that "the lack of domestic steel technology is hindering these companies from becoming providers of the growing automotive sector”. Each year, the industry imports about 4.4 million tons of highly specialized steel with specific calibers that are not yet manufactured in Mexico.

According to data from the Ministry of Economy and Canacero, imports to assemblers exceed 2 million tons, mainly coated plates for car bodies, and the rest to auto parts.

However, investments by Altos Hornos de México (AHMSA) and Ternium México seek to expand the portfolio of products offered in this niche market.


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