Latin American steel demand to grow 4% in 2018: Alacero

Cancun, Mexico (Platts)--9 Nov 2017 455 pm EST/2155 GMT

Latin America steel demand in 2018 is expected to rise 4% over 2017, driven by significant growth in steel use in the main local markets, said Rafael Rubio, general manager of the Alacero regional steel association.

For 2017, Alacero projects apparent steel consumption in Latin America at 67.2 million mt and 69.9 million mt in 2018.

From the total expected for next year, Mexico, Brazil, Argentina and Colombia are expected to see the strongest growth. Projections released by Alacero showed these countries are to see demand jumping by 3%, 7%, 5.3% and 4%, respectively.

Half of the Latin American consumption by the construction sector and enhancing efforts in this activity would help the region's economies recover more rapidly, Alacero President Jefferson de Paula said at the group's Alacero-58 Congress in Cancun, Mexico. "I see there is a great deficit in housing and infrastructure. We will start working with the governments on this subject."

Another important subject raised by the association is the growing volume of steel imports coming from China. Imports have an increasing importance in Latin American consumption and these "enter, in many cases, under conditions of unfair trade, causing serious damage," Rubio said.

Alacero expects the region's imports of steel goods from China to jump by 11% over year in 2017, reaching 8.5 million mt.

"Around 35% of the consumption is [filled by] imports -- and apart from that there are strong imports of manufactured products too," de Paula said.

So far, Alacero's latest data showed Latin America's imports of steel from China totaling 5 million mt in the period between January and August. From this total, 4.4 million mt were rolled steel goods and the remainder 562,000 mt were end-user products.

Some 3.68 million mt of the total imported was flat steel products and 901,000 mt were long steel goods. The remainder was formed by seamless and welded tubes and end-user products.

Central America was the main destination receiving 1 million mt. Chile, the second on the list, received 916,000 mt and Peru 698,000 mt.

--Bruno Martins, --Edited by Richard Rubin,

Copyright © 2018 S&P Global Platts, a division of S&P Global. All rights reserved.