The United States exempts Mexican steel products from tariffs - Oradel
The IMF forecasts a lower GDP contraction in the Mexican economy
14 December, 2020
Exporting and producing health supplies is a strategic pillar for the economy
14 December, 2020

The United States exempts Mexican steel products from tariffs

Mexican steel will be exempt from tariffs totaling more than 1.2 billion dollars following an agreement between the Ministry of Economy (SE) and the U.S. Government.

Currently, Mexico is the fifteenth largest steel producer in the world with 18.4 million liquid tons per year. The Mexican steel sector exports 3.5 million tons of finished products per year, with more than 62% of sales directed to the United States, according to data from the National Chamber of the Iron and Steel Industry (Canacero)

With this agreement, Mexico is excluded from tariffs being imposed on U.S. electric steel product imports, which are mostly used to manufacture transformers. 

According to the Ministry of Economy, this agreement provides the Mexican manufacturing industry with certainty since it includes a monitoring system for exports of such products to the United States to avoid triangulation. 

In turn, the U.S. Department of Commerce indicated that the products exempt from these tariffs are: laminations, stacked cores and rolled cores to be used for transformers, as well as electrical transformers and transformer regulators made of grain-oriented electrical steel (GOES). 

The decision regarding tariff exemptions originated with an investigation launched on May 11 by the U.S. Department of Commerce, based on section 232 of the Trade Expansion Act of 1962, and requested by the U.S. industry producing the GOES as well as by several members of the U.S. Congress. 

In a previous investigation, carried out by the same agency on global steel imports, between April 2017 and January 2018, 25% tariffs were applied to exports from Mexico during the period from July 1, 2018 to May 20, 2019. However, this time, the involvement of the Ministry of Economy, along with the national industry, resulted in the exclusion of Mexican products under investigation of GOES products. 

According to the SE, this exclusion confirms Mexico’s relevance as the main trade partner of the United States. It also reiterated that both governments can resolve trade differences and promote technical cooperation for a common regional challenge.

In addition, the United States and Mexico will, on a regular basis, discuss the implementation of these measures, as well as on the bilateral trade situation and market conditions concerning Mexican steel. 

Oradel Industrial Center is located a few minutes away from the international bridges with the United States benefiting the foreign trade operations for the companies located within the industrial park. 

Open chat