Mexico Agrees To Enhance Monitoring Of Metals Imports
As Connecting the Dots reported at the time, back in July, U.S. Trade Representative Katherine Tai asked Mexican Secretary of Economy Raquel Buenrostro to address surges in imports of steel and aluminum products coming into the United States from Mexico. (Mexican exports of steel had increased 72 percent in 2022 compared with the 2015-2017 historical average while exports of aluminum rose significantly as well.)
Ambassador Tai’s request came after U.S Congressional Steel Caucus Chair Rick Crawford (R-Ark.) and Vice Chair Frank Mrvan (D-Ind.) sent a letter to President Joe Biden’s administration requesting immediate consultations to address the uptick in imports. That letter alleged the Mexican steel industry “appears to be taking advantage of its status” as a preferred trading partner by exporting steel to the United States that was produced in countries that remain subject to Section 232 tariffs — including Brazil, South Korea, and Russia — and is allowing this steel to enter the United States through Mexico duty free.
Regarding these claims, last week Ambassador Tai announced the Mexican government had agreed to work toward “the reinstatement of Mexico’s export monitoring regime.” No information was provided about timing or how the Mexican government would fulfill this promise.
As a reminder, under a 2019 agreement whereby the United States agreed to remove its Section 232 tariffs on Mexican steel and aluminum products, Mexico was to ensure greater transparency regarding steel and aluminum imports from third-party countries. Under that agreement, if imports surged “meaningfully beyond historic volumes of trade over a period of time,” the United States could request consultations. Following those consultations, the United States could then decide whether to reimpose duties on individual products where the surge took place.
As a reminder, when it comes to Section 232 tariffs, Connecting the Dots is reporting this development for members’ information only. MSCI consistently has argued that global overcapacity and other unfair trading practices, particularly by China, have harmed the U.S. steel and aluminum markets.
To address this circumvention, MSCI has advised federal officials to provide relief for producers up and down the supply chain and to consider the consequences of any new trade policy, including: the economic impact of global overcapacity on the entire domestic metals supply chain; transition times and implementation rules to any new policy; availability of domestic metals to meet U.S. national security needs, as well as general industrial and consumer demand; and trade flows under current free trade agreements, including the United States Mexico Canada Agreement (USMCA). MSCI also asked that Canada and Mexico be excluded from any trade penalties.
Click here to review all of MSCI’s advocacy on Section 232 tariffs.