SÃO PAULO, Brazil (Dec. 26, 2025) — The growing import of Chinese steel into Latin America is putting pressure on local markets and industries, which say they are competing on an uneven playing field due to government subsidies and artificial pricing, a situation that has slowed the sector’s growth just as the region faces rising demand for construction inputs.
According to Ezequiel Tavernelli, president of the Latin American Steel Association (Alacero), the problem lies in the fact that the region is facing “a monster that competes under different rules” and that has “a tangled web of subsidies ranging from raw material procurement to working capital financing, subsidized and very long-term interest rates, (even) financing companies that operate at a loss.”
“We are no longer competing company against company; we are competing companies against a State, and there is no way to compete against a State,” Tavernelli told EFE. In 2024, according to Alacero data, global crude steel demand reached 1.87 billion tons, while China produced 1.005 billion tons and closed the year with excess capacity of 249 million tons available to be placed in international markets, a volume that exceeds the production needs of several regions of the world.
“The OECD informs us that with the investments China has underway through 2027, having begun investing in Southeast Asia, mainly in Malaysia and Indonesia, this excess capacity will exceed 720 million tons,” he revealed.
CHINESE STEEL IN LATIN AMERICA
Alacero notes that in Latin America, steel imports account for 39.7% of total consumption in 2025, meaning that four out of every ten kilograms of steel consumed are imported. China represents 45.4% of those imports. Between January and October 2025, according to data from the Chinese government, the country exported more than 59.316 billion dollars in steel and 87.522 billion dollars in steel-derived products. Of that total, 3.323 billion dollars came from shipments to Brazil, 1.612 billion to Chile, and 345 million to Argentina.
In Argentina, imports of Chinese steel through October exceeded the 248 million dollars recorded in 2024. The Metalworkers’ Union (UOM) told EFE that since the beginning of President Javier Milei’s term in December 2023, around 20,000 jobs have been lost across the union’s various branches. For the UOM, the increase in Chinese steel imports is only one of the factors affecting the sector’s crisis, amid a decline in economic activity that has reduced demand in key areas such as construction and the automotive industry.
Brazil’s steel industry, in the largest Latin American economy, warns of a “risk of collapse” in light of the record volume of steel imports, mainly from China (64%), which led the country to adopt a 25% tariff on steel through 2026. According to Instituto Aço Brasil, the industry association, predatory practices have caused the loss of more than 5,000 jobs and have cut more than 450 million dollars in investments.
COMPANIES AGAINST A STATE
In Chile, Chinese steel led in August 2024 to the closure of Huachipato, the country’s main steel producer, following a severe financial crisis and years of losses. The company accused China of “unfair competition,” and even the surtaxes imposed by the government of progressive President Gabriel Boric on these imports were unable to halt the company’s decline. In Mexico, the inflow of steel from China has also raised alarms, prompting the country to impose tariffs of up to 50% on products originating from the Asian giant.
These measures add to the 25% duty applied since August 2023 to various steel imports and have been ratified by the government of Claudia Sheinbaum. Colombia, another notable case, has accumulated 37 consecutive months of declines in steel production, according to the National Administrative Department of Statistics (DANE), facing a price gap of up to 40% compared with imported steel.
To protect the local steel industry, the country imposed in 2024 tariffs of 14.5% on imports of deformed steel bars from Andean Community countries, while countries without trade agreements, including China, were subject to a 30% duty.
A TARIFF DEFENSE
Tavernelli warns about the focus of exports on raw materials rather than value-added products, both in steel and in other goods, a domino effect that leads him to speak of the region’s “deindustrialization.” According to the expert, China’s strategy is no longer limited to the export of direct steel—such as coils or rolls—but has shifted toward indirect steel incorporated into manufactured goods, such as electric vehicles, refrigerators, and washing machines.
“They end up telling you: ‘don’t produce the car, I’ll send you everything myself’ (…) What the government of each country fails to realize is that they are breaking the fabric of social development,” he said. In that context, he raises the need to level the playing field through a tariff defense similar to that applied by the United States or the European Union (EU), at a time when the region faces growing infrastructure demand and debates who will capture its future growth.
With information from EFE
