Mexico’s government launches integrated trade protection mechanisms as rising steel tariffs impact Mexican-U.S. commercial relationships. The Mexican Senate details harsh counteractions against U.S. imports if Washington sustains a restrictive environment for Mexican steel. Industry representatives and government representatives work collectively on innovative mechanisms to maintain a balance for Mexican manufacturing while still upholding Mexican-U.S. commercial relations.
Senate readies response to U.S. tariffs
Mexico’s Senate underscored the pressing need for the implementation of reciprocal actions when the United States fails to lift tariffs applied on Mexican steel through the contentious Section 232. This tough stand is reflected in the Sectoral Diagnostic Summary of USMCA, to be presented to President Claudia Sheinbaum for consideration by the executive. The entire report indicates that the lifting of Section 232 tariffs is vital for the revival of free trade among North Americans; failure of which will result in the adoption of mutual actions on US exports.
Last November, seventeen Special Working Groups were established by the Joint Committees on Economy and USMCA Implementation Monitoring, led by Senators Emmanuel Reyes and Waldo Fernández, respectively. These groups highlighted the need for collective federal efforts to support the Mexican steel industry, including taking an active role in the USMCA Technical Committees on rules of origin, traceability procedures, energy policies, and the formulation of industrial strategies.
Industry leaders call for stronger government action
CANACERO president Víctor Martínez emphasized the dangers posed by U.S. tariffs to Mexico’s steel industry, citing that “there is no reason and no economic justification for these tariffs, since the U.S. has a surplus with Mexico in steel deals.” Section 232 tariffs, he explained, result from “political pressures to address overcapacity in Asia.”
U.S. imposes 50% steel tariffs, citing security concerns
The United States has applied a 50% tariff to Mexican steel imports, relying on national security as an excuse in accordance with Section 232 legislation, thereby creating major obstacles to Mexican exports. Indeed, according to the U.S. Senate Report, there are major flaws in the mechanisms of current rules of origin, which do not sufficiently encourage regional manufacturing or content development in North America’s manufacturing base.
The growing overcapacity in Asia, driven by subsidies, creates an unfair competition environment, thereby encouraging more imports of manufactured products that adversely affect manufacturing capacities in a wide range of industrial sectors in this region. Martínez points out that there are differing trends in the U.S. industry data, with steel prices falling in thirteen key products in Mexico while prices are increasing in the U.S. during the same time frames.
Policy response framework
- Preparation of senatorial countermeasures
- CANACERO Industry Coordination Initiatives
- Participation in USMCA technical committees
- Regional security approach development
Mexico favors tariffs on Asian steel imports
Though CANACERO is opposed to the tariffs imposed by the U.S. government against Mexican goods, it is in support of the new tariffs imposed by Mexico on nations that do not have trade agreements, especially Asian nations, which pour subsidized steel into the world market. CANACERO welcomed changes made by Congress related to the reform of the General Import and Export Tax Law proposed by President Sheinbaum, which imposed higher tariffs on imports of steel and other strategic goods.
The harmonized tariff regime enables the imposition of tariffs as high as 50% as of 2026 on a wide range of products, including sectors such as steel, autos, and aluminum manufacturing. After negotiations with the Mexican Economy Ministry, the proposed packages were adjusted to lower tariffs for certain goods in accordance with its most important trading partners.
Mexico’s unified actions also convey an expertise with modern trade wars that effectively strike a balance between defensive and partnership strategies. A trade policy focusing on integration and no distorting tariffs, as Mexico is promoting, means that Mexico can be regarded as a responsible trade partner that promotes sustainable economic development.
