The Latin American Steel Association (Alacero) has issued an urgent warning about the critical state of the region's steel industry, which faces mounting pressure from Chinese overproduction and complex subsidy systems that distort global trade markets.
Industry decline accelerates
Latin America's crude steel production has dropped 13 percent between 2021 and 2024, while imported rolled steel now accounts for a record 40.3 percent of total regional consumption in the first half of 2025. Chinese steel exports to Latin America have exploded by 233 percent over the past 15 years, with indirect steel exports embedded in finished products surging 338 percent between 2008 and 2024.
China's unfair competitive advantage
Alacero stated that China's steel production operates outside normal market principles, prioritizing job creation over supply and demand. The country maintains interconnected subsidies covering land use, infrastructure, loans, tax exemptions, low-cost energy, and regulations limiting foreign competition. These subsidies are ten times higher than those in OECD countries, allowing China to sell steel products below actual production costs globally.
Deindustrialization threatens regional future
The crisis extends beyond steel, threatening Latin America's entire industrial base and 1.4 million high-value jobs that promote social mobility. Regional industrial GDP has declined four percent since the 1990s, while the share of manufacturing exports dropped from 52.8 percent (2000-2009) to 47.2 percent (2020-2023).
Calls for urgent action
"Governments must act more quickly and decisively, implementing trade defense measures that level the playing field and protect our industries from unfair practices," said Ezequiel Tavernelli, Alacero's executive director. He emphasized that current trade protection measures often prove slow or ineffective, with some countries absorbing exports originally destined for nations with stronger defense mechanisms.
"This is not about closing markets, but about ensuring fair competition. Latin America has the talent, resources, and capabilities to develop a sustainable and competitive industry," Tavernelli concluded.