Steel expansion to benefit local port; Ternium investing in Mexico plant

A $1 billion expansion of a steel plant in northern Mexico by the Port of Brownsville’s biggest steel customer can only mean good things for the port.

That’s according to Port Director and CEO Eduardo Campirano, who said the port is expected to through-put 3.6 million metric tons of steel slab from Brazil to the Ternium S.A. plant in Pesqueria, Mexico, near Monterrey.

“That would be certainly more than we did last year, and projections are to continue to ramp up through the next two or three years,” he said.

The Pesqueria facility, which came online in 2013, recently added a hot-rolling mill to serve the automotive, appliance and construction industries. The $1 billion investment will go toward expanding the complex, the company said last month. All steel slab processed by Ternium’s Pesqueria plant goes through the Port of Brownsville, with the port’s short-line railroad handing it off to Kansas City Southern de Mexico for shipment to Ternium, which is headquartered in Luxembourg.

“They have a facility that they own in Brazil, so we had already been seeing a shift to steel coming from Brazil, so we’re still receiving plenty of steel,” Campirano said.

The port is working on a rail-expansion project in collaboration with Ternium, the port’s Brownsville Rio Grande Valley International Railway, and port stevedore Gulf Stream Marine to maximize efficient loading of open-top gondola rail cars with slab bound for Pesqueria.

Although supply issues as a result of the pandemic has impacted Mexico’s auto manufacturing sector along with nearly every other industry, Campirano said things appear to be picking up again.

“I had asked (Ternium) some time ago,” he said. “They’re the premier steel supplier in Mexico. What they’re saying is they’re seeing more and more coming online. I think that the automobile industry in Mexico is ramping up. They’re saying they’re seeing an increase in demand for steel from the industry as well as construction projects.”

The news is mostly good despite lingering problems from the pandemic, Campirano said.

“I think there are still going to be issues,” he said. “We see them here. We see them globally. But for the most part, yeah, people are going back to work. Production is starting to ramp up. Recovery is on its way. Is it where it needs to be? Probably not, but at the end of the day, more and more is being done every day.”