During 2012, Latin America received 4.6Mt of finished steel from China which made it the second most important destination for such exports after South Korea, and moved the European Union into third place.
In the case of steel containing products (indirect trade), Latin America experienced an increase of imports from China of 11%, while the flow from China to the rest of the world grew just 6%.
In contrast, China is importing less steel and steel containing products from Latin American countries. During the past three years, Latin American trade deficit grew continuously to reach 41% for steel containing goods and 29% for steel products, comparing 2012 data versus 2010.
Figures show that Latin America attracts Chinese steel exports at quantities above the global average.
The story is different for raw materials. Between 2006 and 2011, the trade balance for raw materials increased 6-fold in favour of Latin America. However, the slowdown of the Chinese economy in 2012 resulted in weaker demand for raw materials.
In 2012, Latin America accumulated a surplus of US$26.359bn in raw materials sales to China but a deficit of $46.067bn on steel and steel containing products. Thus the value of exports of raw materials accounted for only 57% of the cost of imports from China. This shows the vulnerability of a model that is strongly focused on natural resources over one that promotes regional industrialisation.
The Latin American Steel Association has published the 7th Edition of the Yearbook ‘China- Latin America Foreign Trade Yearbook’. Available for purchase at www.alacero.org or free to Alacero members at Alacero´s Extranet.