Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

Mexico and the US have reached an agreement to keep tabs on steel exports from the former to the latter to ensure they do not contain low-cost steel from countries outside North America.

 

The bilateral agreement that begins this quarter, focuses on the transshipment of grain-oriented electrical steel (Goes) from outside North America into the US through Goes-containing downstream products, the Mexican Secretariat of Economy said in a statement.

 

Under the agreement, Mexico will monitor the exports of these products to the US. Moreover, shipments of electrical transformers, laminations for stacked cores for incorporation into transformers, stacked cores for incorporation into transformers, and transshipment of Goes from Mexico to the US will not be subject to tariffs, thus excluding it from the recently imposed Section 232 on Goes.

 

Transformers are part of the US energy infrastructure, and electrical steel is necessary for power distribution transformers for all types of energy such as solar, nuclear, wind, coal, and natural gas across the US, according to data from the US Department of Commerce. Recently, Commerce imposed Section 232 tariffs on Goes from South Korea after a complaint filed by steelmaker Cleveland Cliffs.

 

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