During his participation in the Steel Market Update (SMU) Summit 2023 -the most important forum on steel and steel industry trends in North America-, the president of Ternium Mexico addressed issues such as the effects of nearshoring in the region and the projection of a high demand for steel in the coming years.
On August 22, during the second day of SMU Summit activities, Michael Cowden, Managing Editor of SMU, interviewed César Jiménez. In the conversation, in addition to explaining the US$3.2 billion investment in Pesqueria with a view to start operations in 2026, Jiménez talked about the nearshoring phenomenon in the region, where he mentioned that new investments have been announced in Mexico thanks to its geographic advantage, its highly skilled labor force and shorter delivery times.
"We learned the hard way, with the trade war against China, the war between Russia and Ukraine and all the logistics problems we had, that it is very risky to have a supply chain so far away. We have to get closer to the end market, to be closer to our end customers. I think this trend will continue and will bring additional demand to the whole region, not just Mexico," he told more than 1,300 attendees, including U.S. steel industry leaders, customers, suppliers, officials and the media.
He mentioned that Ternium sees many opportunities for steel to be the material of the future: renewable projects, such as solar panels and wind farms, will bring greater steel consumption, as well as decarbonization processes and even the transition from combustion to EV, which will occur at different rates in each country. As for the challenges facing the industry in Mexico, he explained that there are logistical problems such as the need for greater transportation capacity, which implies more trucks, trains and new ways of distributing products between countries in the region, in addition to the availability.
"The good news is that I think the Mexican government is realizing that energy is a critical part of Mexico's future, and they are changing investment plans, creating more renewable projects and increasing capacity.”
Regarding Ternium's participation in Usiminas, he said, "We are very hopeful that the Brazilian economy will start recovering, as well as steel consumption, so part of Ternium Brazil's slabs will go to Usiminas, another part will go to Mexico. We will have our own slab production plant and we will also continue to buy part of it in the market.
Jiménez concluded the interview by thanking customers and pondering the best way to create the value offering they need: "We have been investing and will continue to do so in order to try to be the best supplier and give them the best possible solution in quality, service, price, experience and all the things that are important for their business. Ternium's success is based primarily on our customers.”
The Steel Market Update Summit (or SMU SUMMIT 2023) represents North America's most important forum on steel trends, industry and an important meeting point to generate new business. This event has grown considerably from 434 attendees in 2016 to more than 1300 in this edition, with representation from more than 480 steel industry companies in the region.
In the series of conferences, one-on-one interviews, and specialist panels, relevant topics for the industry were discussed, such as new generations of steels and raw materials, volatility of steel markets and prices, new technologies applied to the steel industry, the effects of decarbonization on trade policies, and nearshoring in the industry.