MEXICO CITY, Oct 31 (Reuters) - Mexico is on the right

path to develop its steel industry but Argentina and Brazil are

still falling short of their potential, top officials of three

regional producers said.

WHY IT MATTERS

The steelmakers - Ternium ( TX ), Gerdau ( GGB ), and the Brazil unit of

ArcelorMittal - have long complained of an unfair playing field

in the region, saying China engages in "dumping," or flooding

markets with material sold below market value.

In recent months, Mexico has slapped tariffs on some steel

imports and rolled out a program to track products' country of

origin, as producers say China ships steel through third

countries before it reaches Mexico.

CONTEXT

Latin America has huge potential to grow in steel demand,

said Jefferson de Paula, head of ArcelorMittal Brasil. However,

political and economic instability, as well as Chinese imports

of steel and finished products, pose headwinds, he said.

Governments have also been slow to adopt measures to combat

dumping practices, said Gustavo Werneck, chief executive of

Brazilian steelmaker Gerdau ( GGB ). This month, Brazil rolled out some

25% import tariffs.

WHAT'S NEXT

Mexican President Claudia Sheinbaum, who took office at the

beginning of October, has laid out a plan to work with industry,

said Maximo Vedoya, CEO of steelmaker Ternium ( TX ).

The country is also taking advantage of a supply chain

shift, he added, referring to a trend known as "nearshoring."

Brazil, however, is no longer the industrial powerhouse it

once was, he cautioned. "Brazil has the ability to enter the

Americas' supply chain, with all the capacity it has," Vedoya

said. "But it's far from benefiting from this regionalization

phenomenon."

Argentina must sort out its macroeconomic situation before

rolling out industrial policy, Vedoya added. "Argentina has

distorted costs for everything - taxes, labor, regulations," he

said. "If we want to have industry, we need to make it more

competitive."

KEY QUOTES

"The United States is leading the way (in measures to combat

Chinese steel)," Vedoya said. "Europe is next, India, Mexico.

Brazil is taking the first steps. The rest of Latin America

should follow."

Werneck said, "We (steelmakers in Latin America) are not

asking for any type of special treatment. We're asking for an

even playing field."

BY THE NUMBERS

Global steel consumption is about 223 kg (492 lbs) per

person, de Paula said. In Latin America, that number is less

than half.

Steel imports to Latin America leaped 14% in 2023, while

consumption was up just 5% from the previous year, data from

regional steel association Alacero shows.