The last few years have been particularly challenging for the economies in Latin America.  Slowing steel production and consumption in 2019 continue to concern local producers. Despite this, actions taken by some countries to renew infrastructure investments and to promote the steel sector give some hope that LatAm could improve its current situation. These were views expressed by steel industry participants from the region at the annual general assembly of the World Steel Association (worldsteel) in Monterey, Mexico attended by Kallanish.

 “We are moderately optimistic. Only some of the Latin American countries will slightly improve steel production in 2019, such as Brazil, Peru, Chile. That of other important players such as Argentina and Mexico are continuing to fall this year and outlook is not positive,” says Francisco Leal, the ceo of regional steel producers' association Alacero. Given the commercial tensions throughout the world and its consequences for Latin American industry, the regional steel sector needs to evaluate the impact of these, Leal suggests. It also needs to make decisions for the future to protect jobs and to modernise its production processes, he adds.

One of the main issues of concern to the regional steel market is the trade deficit with China. This is part of “… the great challenge” of maintaining production in the sector and contributing to the development of the region.

“China is taking steps to increase its presence in Latin America by investing in steel and mining projects. However, negotiations between local governments and potential Asian investors last too long or it turns out that their intentions are very uncertain. This political gap leaves much of the region unprotected from Chinese imports, while exports become unsustainable and as a result, the trade deficits with China grows,” Leal continues.

Executives from the leading steel producers in Latin America will meet in Buenos Aires in November for the Latin American Steel Conference, Alacero-60. Experts will discuss the challenges, new policies and improving scenarios in steel sector during the meeting.

The World Steel Association (worldsteel) says in its latest Short Range Outlook that Central and South American apparent steel demand will slip -0.4% in 2019, while it will rise by 3.9% y-o-y in 2020.