Ternium Urges USMCA Rule Changes Amid Steel Tariff Disputes

Ternium, a major steelmaker with significant operations in Mexico, is pushing for tougher trade terms under the U.S.-Mexico-Canada Agreement (USMCA) ahead of its scheduled review. Despite ongoing headwinds from steep U.S. steel tariffs, the company is advocating for stricter "rules of origin" to curb unfair competition, particularly from Chinese steel dumped into the region.

Under USMCA, Mexican steel shipments to the U.S. are currently exempt from some tariffs. However, steel products still face a hefty 50% U.S. tariff. Negotiations between the U.S. and Mexico are ongoing to ease these tariffs for steel imports up to a certain threshold, according to recent Reuters reporting.

Ternium argues that tighter rules would help prevent foreign steel—particularly from China—from entering North America disguised as regional product. Dumping practices, where steel is sold below market value, have long been a concern among U.S. and Mexican steelmakers. Often, such products are rerouted through third countries, making their true origin difficult to trace.

In a recent analyst presentation in New York, Ternium emphasized the importance of reinforcing regional protections in the face of global economic challenges. J.P. Morgan analysts noted that Ternium views the current U.S. tariffs as a long-term advantage for a more balanced globalization.

In 2024, the U.S. exported 2.28 million metric tons more steel to Mexico than it imported, Ternium reported. Meanwhile, U.S. officials have criticized Mexico for oversupplying its own market.

Looking ahead, Ternium aims to expand its share in Mexico’s domestic steel market. In Brazil, however, it continues to face pressure from cheap Chinese imports. While an acquisition of the remaining shares in Brazil’s Usiminas is a possibility, Ternium’s management indicated it's not a near-term priority.