Mexican domestic hot rolled coil (HRC) prices have continued their uptrend, increasing by US$4/mt in the last two weeks to settle at US$745/mt ex-mill.
While decent demand from the automotive sector is reflected in HRC prices, financial sources predict a slowdown in the Mexican automotive sector over the next few months. According to the Mexican Association of Automotive Industry (AMIA), the first seven months of the year showed a 4.1 percent growth in vehicle production compared with the same period of last year, although levels in July decreased 1.4 percent versus July 2012.
Additionally, domestic producers are concerned that Indian investors have shown interest in investing in the Mexican auto parts sector, especially in the State of Puebla, but the input of intermediate goods would turn into additional unfair competition from a country that already engages in steel product dumping.