Latin America’s steel trade deficit with China has increased 26 percent in 2014 to $24.8 million, year-on-year, according to data released on Wednesday by the region’s steel association, Alacero.
According to Alacero, the region’s trade deficit has been increasing continuously in the past three years. In 2012, the region’s trade deficit with China was $19.7 million, an 82 percent increase when compared to 2011. A year later, in 2013, the trade deficit was stable at $19.6 million, but surged 26 percent to $24.8 million in 2014, according to Alacero.
The trade deficit for finished steel products in 2014 increased 39 percent to $5.4 million from $3.8 million a year ago.
According to Alacero, prices for iron ore and scrap have reached minimal levels in 2014. As a result, China benefited from those prices. According to Alacero, China bought 5 percent more raw materials from Latin America in 2014, but at prices that were 16 percent lower compared to 2013.
Iron ore was the product Latin America exported the most to China. About 199 million mt of the product were sent to the country in 2014, 5 percent more compared to 2013. 86 percent of these exports came from Brazil, which is home to iron ore giant Vale.
Chinese finished steel exports to Latin America increased 56 percent in 2014, year-on-year, to 8.3 million mt, while the region exported only 41,000 mt of the product to the Asian country. The amount is 3 percent lower compared to the volume registered in 2013.
China’s primary destinations for finished steel in 2014 were Brazil, which received almost 2 million mt of the product, Chile (1.2 million mt) and Central America (1.1 million mt). Mexico received about 790,000 mt of the product.
Flat steel imports from China accounted for 67 percent of all finished steel coming from the country in 2014, with a 5.5 million mt volume. Long steel imports by Latin America totaled 2.2 million mt, 79 percent up year-on-year.