When the United States doubled tariffs on Mexican steel and aluminum this year, it sent a ripple of concern through Nuevo León’s steel industry. For a region that supplies a large chunk of Mexico’s steel exports, the higher duties are squeezing small producers, disrupting supply chains, and forcing local businesses to scramble for new markets.
In early 2025, the U.S. raised its import duties on Mexican-made steel and aluminum from 25% to 50%, under Section 232. That increase came after the earlier 25% rate was reinstated in March.
The result? Mexican steel exports to the U.S. tumbled. In the first half of 2025, steel shipments dropped 16.6% compared with the same period last year.
Aluminum exports also declined sharply, by about 20%. For a steel hub like Nuevo León, these figures are more than statistics, they represent shrinking demand and mounting pressure.
Nuevo León is no stranger to steel production, and its mills have traditionally relied on strong demand from the U.S. market.
But under the shadow of the new tariffs, smaller steelmakers are feeling the squeeze the most. According to Canacero, Mexico’s national steel chamber, the 50% rate disproportionately hits Mexican producers and weakens their competitiveness.
Logistics companies are also taking a hit. Truckers report fewer shipments of steel coils and profiles destined for U.S. plants, citing both the higher export prices and the reduced demand. This slowdown affects the entire supply chain — from mills to transport to downstream manufacturers.
The tariffs don’t just hurt steelmakers, they ripple outward across Mexico’s economy. The construction sector, for example, is already grappling with higher input costs. Some estimates suggest the price of building materials could rise by 3–4% as steel becomes more expensive to source.
Moreover, the Mexican government has pushed back, arguing that the tariffs are unfair given that the U.S. runs a steel trade surplus with Mexico.
Economy Minister Marcelo Ebrard called the move “unjustified.” Canacero echoed that sentiment: instead of undermining regional integration, it said the two countries should work more closely, especially within the USMCA framework.
Despite the immediate pain, the steel industry in Nuevo León isn’t standing still. Backed by optimism about future demand, Mexican steel companies have pledged a massive US$8.7 billion investment to expand domestic capacity. The plan includes boosting production at plants in Nuevo León so that more steel can be absorbed locally or sold to other international markets.
Still, the shift is risky. Mexican mills must find outlets for new production even as the U.S. market remains uncertain. Analysts warn that weaker demand at home and abroad could leave some of this capacity underused.
For Nuevo León, long known for its strong industrial base, the weight of U.S. protectionism is a wake-up call. Steelmakers face a difficult balancing act: restructure and invest or scale back and risk losing relevance in a changing global landscape. The threat to smaller firms is real, and the once-steady trade flows are suddenly volatile.
At the same time, the tariffs are testing Mexico’s broader economic strategy. By pushing for negotiations rather than retaliation, the Mexican government is signaling that it prefers cooperation over confrontation. But with exporters feeling the squeeze, the pressure to protect domestic business is growing.
The Nuevo León steel industry finds itself caught in a difficult moment. U.S. tariffs have slashed demand, raised costs, and threatened the survival of small producers.
In response, the sector is launching a bold investment drive to strengthen internal production, even as Mexico presses Washington to reconsider the steep duties. What happens next could reshape steel manufacturing in Mexico and, by extension, the future of regional trade.
