Following increased international investments in the Mexican automotive industry, as well as the country’s strategic importance in the North American market, Mexico represents “a dynamic market with substantial growth opportunities”, says Ternium.
 
According to the Latin American steelmaker’s latest report seen by Kallanish, orders from local industries are expected to grow over the coming months, especially in the automotive sector where the company estimates a progressive increase in demand for coated steel.
 
Positive expectations over the country’s steel demand are also on account of increased volume of investments related to the new National Infrastructure Plan and energy reform. The latter is also expected to create numerous opportunities for private investors.
 
As of today, the Latin American steel manufacturer produces nearly 5.6 million tonnes/year of steel products in Mexico, or approximately 60% of its total output. The country’s mines also provide 50% of the group’s iron ore consumption.
 
According to the company’s strategic plan, the group aims to secure its position as the largest supplier for the Mexican automotive industry, with 25% of its total output destined for this sector.
 
By end-2015, high-end products will comprise 20% of the company’s output, compared to the 6% recorded in 2010, while 49% of production will remain in the construction market. In the latter segment, hot-rolled products (36%) and rebar (20%) will be more than a half of the company’s business.
 
In the last years the group invested $1.1 billion (€1 billion) in the development of a steel complex located in Pesqueria, Nuevo Leon region, with an output of 1.5m t/y of cold rolled steel and 400,000t of galvanized steel. The project includes the construction of a 900MW combined cycle power plant, expected to be operational by late 2016. It is owned by Ternium (40%), Tecpetrol (30%) and Tenaris (22%).