Mexican authorities should impose permanent tariffs on steel slab imports from countries that do not have free trade agreements with Mexico, the legal director of ArcelorMittal in Mexico, Jorge Guzmán, tells Kallanish.

The executive says the company and the Mexican Secretariat of Economy (SE) are negotiating to increase the tariff and to include slab in the country’s permanent import taxes.

“Mexican slabs are without protection and we are working jointly and permanently with the SE to find a mechanism that could protect domestic production of slab from imports, which are impacting our ability to attend the domestic market,” says Guzmán.

The defence measure will encourage investment projects and provide protection for the national steel industry from the diversion of trade to the country as result of the new US tariffs, the legal director comments.

SE has applied temporary 15% anti-dumping duties on imports of slab, plate, wire rod, and cold and hot rolled sheet for renewed periods of up to six months since October 2015. This measure is applied to countries that do not have free trade agreements with Mexico. The measure was subject to four renewals and it expired indefinitely on 31 May.

As reported, earlier this month Mexico also announced the elimination of preferential treatment for US imports of steel and farm products, thereby applying tariffs of 15-25% to US steel imports.

ArcelorMittal has announced a major new investment programme at its Mexican operations. The main investment will be the construction of a new hot strip mill at Lázaro Cárdenas. The project will take approximately three years. Following the investments the steelmaker expects to have an output in Mexico of over 5 million tonnes of flat rolled steel, 1mt of slab and 1.8mt of long steel products.