Iron pellet production in Mexico decreased 3.5 percent, year-over-year, in September to 514,389 metric tons (mt). This behavior was due to the declines registered in the regions of Altos Hornos de México (AHMSA) and ArcelorMittal. In the area where the Peña Colorada complex operates, it increased 7.5 percent, 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 accumulated 10 consecutive declines until September.
Of the three large mining regions producing iron pellets in Mexico, the most important, with 68.4 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 351,890 mt, 7.5 percent or 24,514 mt less compared to September of last year. It is the first increase after three consecutive drops. In addition, it is the fourth increase in the last 16 months (since June 2022).
In the region where ArcelorMittal México operates its Las Truchas mining complex in Lázaro Cárdenas, in the western state of Michoacán, production was 113,528 mt, a figure that represented an annual decrease of 0.9 percent compared to September of last year. It is the fourth drop in the first nine months of the year.
Michoacán contributed 22.1 percent of all pellet production in the ninth month of the year, according to Inegi data.
The greatest contraction in pellet production occurred in the northern state of Coahuila, the birthplace of the Altos Hornos de México steel company (AHMSA). In September, production was 48,971 mt, a volume that represented an annual drop of 46.1 percent or 41,885 mt compared to the same month last year.
It is the eighth consecutive annual decline in Coahuila and the 11th decline in the last 12 months. This volume is the lowest in the last 37 years, only surpassed by the almost 39,700 mt in January 1986.
In September, the average value of the metric ton of pellets was MXN 1,363 pesos, a figure that at today's exchange rate represents $77.2/mt. In pesos, the price decreased 15.6 percent in nominal terms (without adjustment to eliminate inflation).
In nominal pesos, in September the 12th annual drop in the average price was recorded. In real terms (pesos adjusted to eliminate the inflationary effect), the drop in price was 19.2 percent and is the 32nd consecutive annual drop.