Mexicana Aceroteca to Inject $10 Million into Texas Steel Processing Center

12 June, 2023 by

Aceroteca, a Mexico-based steel distributor and processor located in Nuevo Leon, has seized a lucrative business opportunity by partnering with two other entities to invest $10 million in a state-of-the-art warehouse and processing facility in Seguin, Texas. In an interview with SteelOrbis, Hector Morales, the company's general director, revealed that the facility will have a storage capacity of up to 10,000 metric tons (mt) of steel and a monthly processing capacity of 3,000 mt.

Morales emphasized the strategic advantages of the new service center, which is situated in close proximity to the Tesla gigafactory in Texas and the Caterpillar plant. By utilizing the center, customers will enjoy significant cost savings of approximately $100 to $150 in logistics expenses, in addition to tax benefits. Morales expressed his excitement about tapping into the market and meeting the demands of local clients, particularly those at the border, with expedited services.

The inauguration of the Steel Dynamics plant in Sinton, Texas has created an attractive investment opportunity, as the company's production capacity of 3.0 million mt of steel, utilizing electric arc technology (EAF), requires efficient processing centers. Presently, the main steel processing hubs are located in Houston or Dallas, prompting Aceroteca's decision to invest in the area. Morales highlighted the advantage of serving clients at the border without tax concerns due to the Inmex program, a governmental initiative that allows deferring import taxes and value-added tax payments.

In addition to tax advantages, Aceroteca aims to deliver significant savings in logistics costs. The processing center, expected to commence operations no later than January 2024, is strategically situated 38 miles east of San Antonio and 64 miles south of Austin. Morales estimated that rival processing centers currently face additional costs of $40 to $50 per ton for transportation. With Aceroteca's center, customers can expect savings of 5% to 10% in logistics expenses, resulting in substantial benefits.

Aceroteca, with 30 years of experience in the steel market, is well-positioned to capitalize on this investment. Notably, their existing processing center in Nuevo León, Mexico, is also conveniently located near the Tesla gigafactory in Nuevo León-Mexico, Santa Catarina.

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