News from our correspondent On August 15 local time, the Mexican government announced a new tariff plan, stating that it will temporarily impose import duties ranging from 5% to 25% on 392 tax items from countries that have not signed free trade agreements with the country. To protect the Mexican domestic market, 74 steel products will be subject to a 25% import tariff (previously about 10%), valid from August 16, 2023 to July 31, 2025.
South Korea is not among the countries that have a free trade agreement with Mexico. According to statistics from the Korean Iron and Steel Association, of the 26 million tons of steel exported by South Korea last year, exports to Mexico accounted for 2 million tons, accounting for about 7.8%, and were worth about 2.7 billion US dollars. On August 22, the Ministry of Industry, Trade and Resources of Korea held a meeting on “Relevant to Mexico’s Tariff Increase” with representatives of 7 related parties including Pohang Steel, Hyundai Steel, and Dongguk Steel at the office of the Korea Iron and Steel Association in Seoul. Iron and Steel Industry Countermeasure Conference”. At the meeting, the Korean Iron and Steel Association stated that 85% of the country’s steel products shipped to Mexico will be exempted from tariffs because it relies on Mexico’s Industrial Promotion Policy (PROSEC). The tariff increase will have limited impact on Korean steel companies in the short term, however Whether PROSEC can continue to be implemented is still uncertain, so the Korean government and local steel companies need to make preparations in the long run.
In an interview with the Korean media “Green Economy News” (greened.kr), a related person from Hyundai Steel said that the company supplies automobile steel plates to related companies in Mexico. Because it enjoys the right to exemption from tariffs for a certain period of time, the Mexican government is currently making a new decision. Announced plans have less of an impact on it. Hyundai Steel also stated that it will continue to pay attention to future trends. A related person from Dongguk Steel said that about 20% of its exported color steel plates are sent to Mexico, mainly processed color steel plates for home appliances, so they are not subject to tariffs, but the color steel plates it produces will be subject to the tariffs. certain influence. To this end, Dongguk Steel plans to increase the sales share of products mainly based on high value-added products to meet unknown challenges.