CRU: Countries start protecting steel in world of 25% US tariffs

India

However, India’s Directorate General of Trade Remedies (DGTR) investigation into a surge in imports of non-alloy and alloy flat steel products dates back to last December following a complaint from the Indian Steel Association, which is concerned about the rise of deliveries from countries such as China, the Press Trust of India news agency reported.

The Directorate has preliminarily found the imports are causing, or threatening to cause, serious injury to the domestic industry. Delaying provisional safeguard measures would cause damage that would be difficult to repair, the DGTR argues. The finance ministry has the final say on the matter.

South Korea

Meanwhile, the South Korean government announced it would act to prevent the circumvention of AD tariffs on steel products to help protect the domestic industry amid greater global trade barriers.

Measures include revising customs regulations to allow the Korea Trade Commission (KTC) to investigate circumvention; the requirement of a mill test certificate with detailed information on a steel product’s country of origin; and the formation of a special team within the customs service to crack down on the practice of disguising imported goods as domestically produced.

At the same time, the Ministry of Trade, Industry and Energy will work to exempt duties on South Korean steel products by closely communicating with governments of major economies, including the US, Yonhap news agency reported.

In addition, the Ministry plans to devise a strategy later this year to bolster the domestic steel industry’s competitiveness to overcome the crisis sparked by the global trade war.

United Kingdom

Commenting on the 25% US tariffs, Tata Steel’s UK Chief Executive Rajesh Nair told members of Britain’s parliament: “Customers are spooked and the customers are wanting to go to other suppliers to make sure that they don’t get caught in the tariff warfare. So customers are already talking to us and wanting to cancel orders and, in some cases, are asking us for compensation for potential orders.” The damage to sales and profits could be significant, he added.

The country’s steel producers are also concerned that a flood of cheap steel could enter the UK as foreign sellers seek buyers to replace previous US orders, local media reported.

Allan Bell, chief commercial officer at longs producer British Steel, called for short-term measures “to protect what we have in the country” rather than retaliatory measures against the US.

While the European Commission is acting to block diverted steel from its market, the British government appears to be slower in acting, according to the executives. An apparent mismatch in policies meant that EU steel prices were £60 per metric ton ($77.80/mt, €71.40/mt) higher than the UK’s, Nair said.

As for the impact on the ~50,000 metric tons a year of products British Steel sells into the United States, Bell told the House of Commons Business and Trade Committee: “[Customers] are considering order cancellations. On some products, they are going to other [US] producers. Where there are other domestic producers, we have exited that business immediately. Other customers are worried about the impact of tariffs. Some customers where we are the sole supplier have said they will make moves to purchase that steel elsewhere.”

Also, US producers are developing tooling capabilities to replace British Steel-made products. “So it will not hurt us immediately, but there will be damage in circa nine months’ time,” said Bell.

This article was first published by CRU. To learn about CRU’s global commodities research and analysis services, visit www.crugroup.com.