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Mexico’s foreign minister Marcelo Ebrard Casaubón has said that his country will not accept US’ proposal for steel and aluminum production under the new trade agreement. The new agreement proposes that 70pc of steel for automotive production must come from Mexico’s North American neighbor. 


Casaubón said that Mexico would accept this provision only if it was amended to come into effect more than five years after the start of the trade pact rather than immediately.


During a meeting on Sunday with senators to discuss details of negotiations for the United States- Mexico-Canada agreement (USMCA), Casaubón said that the proposal would put the country at a great disadvantage because cars produced in Mexico use steel components from other countries.


He noted that the country would also not accept any provision on aluminum because Mexico does not produce bauxite, an essential raw material to produce aluminum.


Mexico’s steel production fell by 3.6pc in October this year to 1.5mn mt. Automotive production in the country fell 16.3pc in October to 311,150 cars despite Mexico being one of the largest automobile producers and exporters in the world according to the Mexico Automotive Industry Association (AMIA).


In the first ten months of this year, car production fell by 2.5pc to 3.2mn cars, which represents a lower steel consumption to produce the units.


A delegation from the US is expected to reach an agreement on the USMCA deal with Mexico this week.


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