As US-Cuba diplomatic relations were restored in 2015, giving hope of a lift on the embargo imposed by the US to the Caribbean island, steel sources question the country’s ability to use its strategic position to export steel to the US and elsewhere.
A source from Acinox, one of Cuba’s main steelmakers, said the company has the capacity to explore new markets and is open to do that.
“We’ve exported [billets] to a number of countries,” a source from Acinox said, despite not disclosing much details about the export deals. Acinox is said to have exported small quantities of rebar to countries like Venezuela.
A trader based in Belgium said it imported billet from Acinox in 2012, 2013 and 2014.
“I used to buy thousands of metric tons of billet from Acinox, but last year, they didn’t have capacity to sell the product overseas,” he said.
Sources declined to comment both domestic and import/export prices for Cuba, as the Caribbean economy isn’t globalized.
“As Cuba isn’t a globalized economy, it’s hard to define a price in USD,” the Acinox source said, while explaining the complex situation and form of trade within the Spanish-speaking nation.
Currently, Acinox doesn’t have enough capacity to supply its domestic market, the Acinox source explained. On the other hand, it’s hard for other steelmakers to export rebar to Cuba.
A trader said most Cuban rebar imports to supply its domestic market come from traders, as orders tend to be smaller and very specific.
“Cuba is out of the real world. We basically buy steel in EUR from European producers, which sell us steel with specific dimensions. We then sell that steel to Cuba. There are just a few companies selling directly to Cuba. Most Cuban imports come from traders,” the source said.
According to this source, most of its revenues comes from the specific, niche-focused trade with Cuba.
“Cuba’s situation is really complicated. They often have problems to buy basic feedstock materials. They probably would have more success selling billet to Central America,” said a source from a major global steelmaker, while commenting on the possibility of billet sales from Acinox to the US.
The Acinox source said Cuba has a plan to boost billet exports, however, it needs to analyze if it’ll have competitive costs to sell the product in the global markets.