abril 29, 2026

Agreement to Promote the Mexican Steel Industry: Closing the Door to Foreign Steel

On April 29th, 2026, Mexican President Claudia Sheinbaum signed the Agreement to Promote the Mexican Steel Industry as part of Plan Mexico. According to the federal government, this agreement serves as a tool to strengthen domestic steel production and consolidate domestic supply chains. The central message of the presidential address is clear: the steel purchased by the government must, as a priority, be steel produced in Mexico.

The agreement was signed by 19 federal government institutions and three chambers: the National Chamber of the Iron and Steel Industry (Canacero), the National Chamber of the Housing Development and Promotion Industry (Canadevi), and the Mexican Chamber of the Construction Industry (CMIC). This agreement marks a new approach to active industrial policy directly linked to public procurement.

Strategic objetive of the agreement

In general, the agreement to promote the Mexican steel industry seeks to strengthen domestic production of steel products, reduce dependence on imports, protect jobs and investments in the steel sector, and link public procurement policy with an industrial and import substitution strategy.

From the government’s perspective, this is a mechanism to ensure that “where the government buys, the people win,” aligning industrial development with social welfare. In this regard, the construction sector consumes around 60% of the steel used nationwide.

Furthermore, CANACERO estimates that the steel industry accounts for nearly 90,000 direct and indirect jobs in the country. Additionally, it is estimated that the Federal Government will use approximately 150,000 tons of reinforcing steel and 50,000 tons of structural steel for the infrastructure program in 2026 alone.

The pillars of the agreement

Public procurement

This pillar establishes mechanisms to prioritize domestic content in government steel procurement through working groups between agencies and producers, business meetings between public buyers and steelmakers, and incentives (points and percentages) in tenders to favor domestic steel and sustainability criteria.

In practice, this new agreement means that supplier companies must demonstrate domestic origin and supply capacity to compete for public works contracts.

Industrial policy

From an industrial policy perspective, the agreement to promote the Mexican steel industry represents an effort to reduce foreign imports. Steel consumption in the country was approximately 28 million tons in 2025, of which 50% came from abroad.

Consequently, the aforementioned agreement constitutes an explicit import substitution strategy in a key sector. This can translate not only into prioritizing domestic products but also into increased enforcement against alleged unfair trade practices (dumping and subsidies) by other steel-producing countries.

In our view, the signing of the agreement may lead to greater scrutiny of Asian steel imports and a potential increase in defensive trade policy actions. It is worth noting that the Ministry of Economy already has numerous anti-dumping and countervailing duty investigations into steel products from China, Vietnam, and Malaysia.

Financing

The agreement provides financial incentives for infrastructure projects to incorporate Mexican steel, linking public financing to domestic content requirements.

Private sector commitments

Regarding the participation of domestic steel companies, the industry committed to guaranteeing product quality, ensuring sufficient supply and timely deliveries, offering competitive prices under market conditions, and promoting greater use of domestic steel in public projects.

Relevance for domestic and foreign companies

For Mexican companies, the signing of the agreement to promote the steel industry opens a strategic window for supplying the public sector and strengthens investment certainty in steelmaking and steel processing.

For foreign companies, however, it implies an attempt to curb the flow of imports and their participation in key sectors. It will be necessary to evaluate rules of origin, production schemes in Mexico, and local partnerships.

Insights

This agreement represents a structural shift in Mexican procurement and industrial policy, with direct effects on foreign trade, public procurement, and investment planning. Companies participating in infrastructure supply chains must anticipate adjustments to their sourcing strategies, regulatory compliance, and production localization. From a foreign trade perspective, the message is clear: Mexico is committed to producing more steel domestically and purchasing it with public funds.