Mexico Metals Report 2016
BMI View: Mexico is one of the largest producers and consumers of steel in the world, yet the country'ssteelmakers have found themselves faced with increasing competition from a recent surge in cheap steelimports from abroad while global steel prices have also fallen dramatically. While we believe the industryis robust enough to withstand these headwinds, a number of producers have moved to limit capacity andstreamline their workforces. We nevertheless expect output to begin expanding again from 2016 as a strongeconomy and robust demand drive growth.
2016 should see growth in Mexico's crude steel production following an estimated contraction in output ofjust under 2% in 2015. Like those in many other countries, Mexico's steelmakers have been negativelyaffected by a growing Chinese steel surplus and, more specifically, by a significant increase in exports ofcrude and some refined steel products from the country over recent quarters.
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