A lack of economic dynamism in the Latin America region mean that finished steel consumption has dropped 16% and production has fallen 10% during Q1 2016.

According to the Latin American Steel Association (Alacero) the trade balance of the region remains negative.

During Q1 2016 Latin America and the Caribbean produced 18.5Mt of crude steel, down 13% when compared to the same period last year. Brazil accounted for 53% of regional production (9.7Mt) and showed an annual contraction of 14%.

Where finished steel was concerned, the region produced 16.5Mt, down 10% on Q1 2015. Brazil produced 6.7Mt or 41% of Latin American output, and Mexico was second with 6.1Mt, which was 37% of regional output.

Finished steel consumption between January and April 2016 was 20.5Mt, down 16% when compared to last year, and Mexico recorded the largest increases in consumption in both absolute and percentage terms (an additional 93kt, up 1%). Honduras was up by 24kt, an increase of 32%, and Guatemala added 5kt, up 2%.

It’s not all good news. In Brazil finished steel consumption shrank 2.5Mt and was down 30% when compared to Q1 2015. Respective declines of 9%, 6% and 1% were seen in Argentina, Chile and Columbia.

Flat steel products account for 53% of Latin America’s total steel consumption, claims Alacero, with 46% long products and 1% seamless tubes.

Imported steel, however, dropped with finished steel down 21% when compared with Q1 2015. Imports during the period were 9Mt of which 66% were flat products, 32% long products and 2% seamless tubes.

Alacero claims that imports represent 35% of regional finished steel consumption.

Finished steel exports, on the other hand, were up 17% to 2.9Mt of which 54% was flat products, 38% long products and 7% seamless tubes.

In terms of finished steel, the region recorded a Q1 2016 trade deficit of 4.2Mt, 36% lower than for the same period in 2015. Brazil maintained a 1.3Mt trade surplus but Brazil recorded the largest deficit (-2.1Mt) followed by Columbia (-858kt); Peru (-560kt); and Chile (-523kt).

Figures for May 2016 show that crude steel production reached 4.8Mt, up 6% on the April 2016 figure and 13% down on May 2015. Between January and May this year the figure was 23.3Mt, down 13% on January to April 2015.

Finished steel production for May 2016 closed at 4.5Mt, 5% up on April 2016 and 3% less than May 2015.