Mexico-based Aceroteca, distributor and processor of steel in Nuevo Leon, identified an important business area with the start-up of Steel Dynamics in Sinton, Texas and decided with two other partners to invest $10 million in a warehouse to store up to 10 thousand metric tons (mt) of steel and process 3,000 mt per month in Seguin, Texas, said in an interview with SteelOrbis, the general director of the company Hector Morales.
With that service center, customers will be able to save between $100 and $150 in logistics costs, plus tax savings, Morales said, adding that the new Mexican investment will be located in the vicinity of the Tesla gigafactory in Texas and the Caterpillar plant.
The investment in Texas by Grupo Aceroteca México is through its subsidiary company Aceroteca Metals LLC.
Morales commented that the start-up of the Steel Dynamics plant in Sinton, Texas opened up an area of opportunity for investment. The US steel company inaugurated this year a plant with a production capacity of 3.0 million mt of steel with electric arc technology (EAF).
“Who is going to process part of those 3 million tons of Steel Dynamics? Currently the main steel processing centers are in Houston or Dallas. That is why we are going to invest there, it is an area of opportunity. We are going to take advantage of the market and the geographical location to serve clients at the border, mainly locals with faster services,” said Morales.
"At the border, customers can be served without the issue of taxes by Inmex," added the Mexican businessman. Aceroteca is a company with 30 years in the steel market.
Inmex is the governmental Program for the Manufacturing, Maquiladora and Export Services Industry (Inmex) that allows deferring the payment of the general import tax, the Value Added Tax and, where appropriate, compensatory duties, according to data from the Ministry of Economy.
In addition to tax advantages, Aceroteca will offer savings in logistics costs, according to Morales. The processing center that is estimated to start operations no later than January 2024 is located 38 miles east of San Antonio and 64 miles south of Austin.
According to Morales, currently the rival processing centers, to serve that area, have to take the steel to the north and bring it back. Just one way freight is between $40-$50 per ton. When considering the return, it is $100 or more extra charge.
"The savings with our service center will be between 5% and 10% in the logistics cost of steel," said Morales.
He stressed that his processing center in Nuevo León is also located in the vicinity of the Tesla gigafactory in Nuevo Leon-Mexico, Santa Catarina.