Mexican supplier upends Southwest market
Aug 09, 2013 | 04:52 PM
| Samuel Frizell
NEW YORK A Mexican merchant bar supplier near the California border is changing the regional market by selling steel to end-users and fabricators, detouring around many of the Southwests traditional distributors.
The supplier, Aceros Corsa Ticoman, is the distribution arm for Mexican mill Aceros Corsa SA, which once supplied U.S. service centers in the region and now competes with former customers. The lower-priced imports, sold to service centers traditional customers in partial truckloads, have compressed margins for steel merchant bar distributors in Arizona, California and Nevada, sources said, and eroded the older distributors long-standing customer base.
"You have a Mexican distributor selling to the same people weve been selling to for years and their customers and then their customers, and its all gone," said a source at a steel service center in California. "Ive seen our market share shrink big time."
Mexican merchant bar prices have been very low in recent months, sources said, with a large increase in supply coming on to the market with the startup of Mexican long steel products producer Deacero SA de CVs new mill in March, softening prices and causing distributors like Ticoman to expand their customer base.....
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