International Steel Mills

Ternium CEO sees healthy demand buoying HRC price slide

February 21, 2024

Falling steel prices at present are not a symptom of demand but of imports arriving into the US and to some parts of Mexico, Ternium’s CEO Maximo Vedoya said this week.

Vedoya addressed falling hot-rolled coil prices and where prices are headed in the current quarter on an earnings conference call with analysts on Wednesday. “It’s not a problem of the demand, but it is a problem of imports that are coming mainly to the US and some part also to Mexico. That’s the main reason” for the price declines of the last three or four weeks, he said.

“The good news is that demand is still there,” he added.

He told analysts that he doesn’t see prices going down much further in the near future because of this, noting that he sees a new, higher floor for HRC prices in North America.

He said that imports should begin to ease starting in May.

On the last couple of conference calls, “we were always talking about when the recession is coming,” Vedoya said. “And to be honest, today, we don’t see that in the demand. We see healthy demand in both countries, in the US and in Mexico,” he said.

Vedoya said on the call that “we expect shipments in Mexico to maintain the strong level reported in the fourth quarter of 2023.” The company reported shipping 2.12 million metric tons of steel in Mexico in Q4’23.

“Growth in Mexico’s steel market has been strong,” he stated on the call, noting that steel consumption in the country grew by double digits from 2022 to an all-time high of more than 18 million tons in 2023. And while he doesn’t see consumption growing by as much this year, he noted that the World Steel Association forecasts 2% growth in Mexico.

“The market environment in Mexico continues to be healthy,” he said, citing strong industrial activity, automotive production, non-residential construction activity, and reshoring of manufacturing. Residential construction was the only segment in which he noted weakness due to it being negatively affected by rising construction costs.

Laura Miller

Laura Miller is a reporter and editor for Steel Market Update. She has held a variety of positions within the steel industry since 2007, including reporting and editing for Steel Business Briefing/Platts, the Association for Iron and Steel Technology, and Kallanish Commodities, as well as marketing for what was then known as ThyssenKrupp Steel USA (now AM/NS Calvert). After a five-year hiatus working across other industries, she returned to steel in 2021 and has covered the flat rolled, tubular, and trade areas of the industry. She is a member of the Association of Women in the Metal Industries and a past-president of the AWMI Pittsburgh Chapter. She holds a BA in Latin American Studies from Edinboro University of Pennsylvania. She can be reached at laura@steelmarketupdate.com or 724-759-7869.