The value of metal scrap sales in Mexico by large collection depots decreased 12.8 percent in February, year-over-year, in real terms (adjusted for inflation). It is the 20th consecutive annual decline, a period that constitutes the worst recessionary scenario for that commercial sector, according to SteelOrbis' analysis of data from the national statistics agency Inegi.
In all of 2023, the sale of wholesale scrap in the Mexican steel market decreased 24.1 percent, compared to 2022. It is the worst percentage contraction in 14 years, only surpassed by the 28.6 percent drop in 2009. The largest increase was in 2021 with an increase of 38.2 percent.
The sale of metal scrap is of vital importance for the Mexican and global steel market. According to the steel company DeAcero, one of the largest steel companies in the country, 95 percent of the steel it produces is with that input.
Other steel companies that consume scrap in steel production are ArcelorMittal, Ternium, Grupo Acerero, Tyasa, Gerdau Corsa, Grupo Simec, TAMSA Tenaris, Frisa SuAcero, Altos Hornos de México (AHMSA), although the latter is paralyzed due to insolvency.
The Inegi information corresponds to the trade with wholesale sales of waste materials, which includes the sale of metal scrap, glass, plastic, paper and cardboard, among other reusable waste. The reported drop corresponds to the total activities. Of that total, metal scrap concentrated 68.4 percent of the total sales of said industry.