The agreement between Mexico and the United States to exempt steel exports from Mexico to the US with steel melted and cast in Brazil from the 25 percent tariff on value is in the process of being formalized, Maximo Vedoya, the CEO of Ternium told investors. This contradicts the statement of the president of Mexico who assured, on July 11, that the exemption agreement had already been finalized.
The exemption in question aims to prevent transshipment or triangulation of steel imports from China to the United States via Mexico. Vedoya said that according to Federal Emergency Management Agency (FEMA) statistics, last year 144,000 metric tons (mt) of steel melted in China entered the United States through third countries.
The largest transshipment was through Thailand with 52 percent, 15 percent was exported by Oman and 13 percent through Canada and exports from Mexico only represented 0.2 percent of the total.
“Almost nothing. Mexico has shown a strong commitment to fight against unfair trade practices, mainly from Asian countries which truly harm the USMCA economy and Mexico continues to work on this issue. So to avoid misconception, US trade data plainly show that there's neither a surge nor China's transshipment in Mexico steel imports to the US market,” said Vedoya.