Iron pellet production in Mexico decreased 2.6 percent, year-over-year, in July to 549,900 metric tons (mt), driven by the 8.0 percent decline in the Altos Hornos de México (AHMSA) region, and by the 1.3 percent decrease in production in the controlled regions Ternium and ArcelorMittal, according to a SteelOrbis analysis of data from the national statistics agency Inegi.
The production of iron pellets is linked to the production of steel. In Mexico, steel production has accumulated eight consecutive declines from December 2022 to July.
Of the three large mining regions producing iron pellets in Mexico, the most important, with 61.4 percent of all production, is located in the western state of Colima. In that entity, there is the Peña Colorada mining complex, a joint venture of the Luxembourg-based steel companies: Ternium and ArcelorMittal.
In Colima, production was 337,533 mt, 1.3 percent or 4,548 mt less compared to July of last year. It was the second consecutive annual decline, although in the last 12 months, production decreased nine times.
In the region where ArcelorMittal México operates its Las Truchas mining complex in Lázaro Cárdenas, in the western state of Michoacán, production was 112,684 mt, 1.3 percent or 1,443 mt less than July of last year. It is the third consecutive annual decline.
Michoacán contributed 20.5 percent of all production in the seventh month of the year, according to Inegi data.
The greatest contraction in pellet production occurred in the northern state of Coahuila, headquarters to AHMSA. In July, production was 99,683 mt, a volume that represented a reduction of 8.0 percent or 8,707 mt compared to the same month last year. It is the sixth consecutive annual decline in Coahuila and the ninth decline in the last 12 months.
In July, the average value of the metric ton of pellets was MXN 1,376 pesos, a figure that at today's exchange rate represents $78.8/mt. In pesos, the price decreased 22.3 percent in nominal terms (without adjustment to eliminate inflation).