AIIS: Imports Fall for Second Month in a Row

Imports totaled 3.59 million net tons in March, 3.4 percent less than in February, but 10.9 percent more than in March 2014. South Korea, at 561,000 net tons, was the leading seller of steel to the United States during the month. This marked an increase of 16.6 percent from February and 62.6 percent from the previous March. Canada sent 530,000 net tons of steel south in March, 17.5 percent more than in February and 10 percent more than a year earlier. Most other major trading partners, though, recorded sharp decreases. Imports from the European Union were down 8.7 percent from February and 9 percent from a year earlier to 500,000 net tons, while Russia recorded the biggest decline, with imports from that country falling 60 percent from February and 75.7 percent from the previous March to 112,000 net tons. Imports from Brazil were down more than 30 percent from February and more than 20 percent from March 2014 to 317,000 net tons, and imports from Mexico fell 40.6 percent from February and 32.4 percent from the previous March to 176,000 net tons.

Despite the recent month-to-month decreases, year-to-date imports of 11,692,000 net tons were still 20.2 percent higher than the January-to-March 2014 total. Imports from South Korea were up 61 percent to 1.88 million net tons, imports from Brazil increased 37.4 percent to 1.5 million net tons, and imports from the European Union grew 22.7 percent to 1.75 million net tons. Among the United States’s North American Free Trade Agreement (NAFTA) partners, imports from Canada increased 7.2 percent to 1.47 million net tons, while imports from Mexico dipped 7.4 percent to 758,000 net tons. Imports from Russia plummeted nearly 60 percent to 506,000 net tons.

Semifinished imports totaled 429,000 net tons in March, 46 percent less than in March 2014. Through the first three months of the year, semifinished imports were down more than 22 percent to 2 million net tons.

The South Korean numbers marked a stark rebound after imports from that country fell 42.6 percent from January to February. Falling prices in the energy sector, and the resulting slowdown in oil and gas exploration projects, are, however, likely to continue to put downward pressure on imports from South Korea, which is a major provider of oil country tubular goods to the United States and other countries. The strong dollar may have mitigated what would otherwise have been a steeper decline in imports since last fall. While imports are still growing relative to a year earlier, the difference is shrinking. October 2014 imports were nearly 42 percent higher than in October 2013. By March 2014, however, the month-over-month growth was just 10.9 percent. If this trend continues – and there are few, if any, signs that it will not – yearly growth in imports could soon turn negative.