Deacero announced on June 5 its commitment to invest approximately $600 million in a new steel plant slated to commence production in February 2026. This initiative is expected to augment the company's steel output by 1 million tonnes, supplementing existing production capacities across its facilities situated 182 miles from Laredo, Texas, a crucial port of entry for Mexican steel imported into the US.

Felix Bello, an analyst at Fastmarkets, remarked, "With that investment, Deacero is not only fully embracing green steel and adding to its Neutrum catalog, but also capitalizing on potential North American demand from near-shoring." The Neutrum brand signifies Deacero's lineup of reduced-carbon steel products, solidifying its position as a leading wire producer in Mexico.

"The move will allow Deacero to potentially meet and exceed legislative and regulatory requirements being placed on steel worldwide," added Bello. "All in all, it checks all the boxes for the challenges and opportunities that steel faces."

Known as Ramos 2, the project encompasses the construction of new steel production facilities and includes "a rolling mill to produce structural profiles of up to 27 inches," as detailed in the company's statement.

Deacero emphasized that production will rely on an electric-arc furnace (EAF), a process that utilizes scrap metal and results in significantly lower carbon dioxide (CO2) emissions compared to fossil energy-based blast furnaces.

"This expansion will cater to Mexican domestic demand for long steel products and reduce the need for imports," stated Deacero. The investment in the Ramos Arizpe facilities since 2011, which includes the new plant, totals up to $1.3 billion, the company confirmed in its June 5 announcement.

The structural profiles produced will serve various industries including manufacturing support, oil and gas, and ship construction, according to the statement.

In November 2023, Danieli, a leading equipment supplier, disclosed its selection to supply the project. Sources within Mexico's scrap metal industry anticipated potential impacts on scrap prices following the plant's operational launch, considering Deacero's substantial consumption as one of the country's major scrap metal consumers.

Currently, Deacero produces approximately 4.5 million tonnes annually of steel products such as rebar, wire rod, and other specialized items. Apart from Ramos Arizpe, its production footprint includes plants in Saltillo, Coahuila, and near Celaya, Guanajuato.