Mexican domestic hot rolled coil (HRC) prices fell US$5/mt in the last two weeks to settle at US$704/mt ex-mill. Nevertheless, sources say the HRC market is relatively stable, as strong demand from the automotive industry is expected.
Based on the construction and expansion plans of at least five new automotive complexes, the country will soon have the capacity to assemble more than 4 million units per year, which could overtake the Brazilian automotive sector in the coming years, according to automotive industry sources.
Financial sources stated that Mexico has great opportunities to increase its global market share, given the proximity to the United States and value chains that have been generated by the emergence of clusters in certain regions. And, they said, access to high quality providers such as local steel producers helps reduce costs for assemblers, such as inventory cost, risk, time of delivery, transport, among others.