By Christian Sandoval
International Desk (EFE).- Rising imports of Chinese steel are putting mounting pressure on Latin American markets and local producers, who warn they are competing on an uneven playing field due to Chinese state subsidies and artificially low prices, a trend that has stalled sector growth just as the region faces rising demand for construction materials.
Industry leaders say the influx of Chinese steel is undermining domestic production across several countries, prompting job losses, plant closures, and a wave of tariff measures aimed at shielding local industries.
According to Ezequiel Tavernelli, president of the Latin American Steel Association (Alacero), the core problem lies in China’s vast subsidized overcapacity.
“We are facing a monster that plays by different rules,” Tavernelli told EFE. “It has a tangled web of subsidies, from raw material acquisition to working capital financing, long-term subsidized interest rates, and even support for loss-making companies.”
“We are no longer competing company against company, but company against a State, and there is no way to compete with a State,” he added.
Alacero data show that global crude steel demand reached 1.87 billion tons in 2024, while China alone produced 1.005 billion tons.
That gap generated an estimated excess capacity of 249 million tons available for export, more than the total steel needs of several regions worldwide.
Citing the OECD, Tavernelli warned that China’s ongoing investments, including in Southeast Asia, could push excess capacity beyond 720 million tons by 2027.
Impact across the region
In Latin America, steel imports are projected to account for 39.7% of total consumption in 2025, meaning nearly four out of every ten kilograms of steel used in the region are imported. China represents 45.4% of those imports, according to Alacero.
Between January and October 2025, China exported more than 59.3 billion dollars worth of steel and 87.5 billion dollars in steel-related products, official Chinese data show. Of that total, 3.32 billion dollars went to Brazil, 1.61 billion dollars to Chile, and 345 million dollars to Argentina.
In Argentina, imports of Chinese steel surpassed 248 million dollars by October, exceeding full-year 2024 levels.
The metalworkers’ union, UOM, told EFE that around 20,000 jobs have been lost since President Javier Milei took office in Dec. 2023, amid falling demand and rising imports.
Brazil’s steel industry, the largest in Latin America, has warned of a “risk of collapse” due to record imports, 64% of which originate from China.
The country imposed a 25% tariff on steel imports through 2026. Industry group Instituto Aço Brasil said predatory practices have led to more than 5,000 job losses and over 450 million dollars in foregone investment.
In Chile, competition from Chinese steel contributed to the Aug. 2024 shutdown of Huachipato, the country’s largest steelmaker, despite safeguard measures imposed by Chilean President Gabriel Boric’s government.
Tariffs and industrialization fears
Mexico has also raised alarms, imposing tariffs of up to 50% on Chinese-origin steel products, in addition to a 25% levy in place since Aug. 2023 and upheld by Mexican President Claudia Sheinbaum’s administration.
Colombia, meanwhile, has recorded 37 consecutive months of declining steel production, according to official statistics, with price gaps of up to 40% between local steel and imported products.
In 2024, Bogotá imposed a 14.5% tariff on steel bar imports from Andean Community countries and a 30% duty on imports from non-trade partners, including China.
Tavernelli warned that the region risks deeper deindustrialization as exports remain focused on raw materials rather than value-added products.
He noted that China is increasingly exporting “indirect steel” embedded in manufactured goods such as electric vehicles and home appliances.
“They end up telling you: ‘Don’t produce the car, I’ll send you the whole thing,’” he said. “What governments fail to see is that this breaks the fabric of social development.”
Against that backdrop, industry leaders are calling for stronger tariff defenses similar to those applied by the United States and the European Union, as Latin America debates who will capture the benefits of its future infrastructure-driven growth. EFE
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