The 25% steel tariffs imposed by the US on March 12 led to a sharp decline in South Korean exports to the US. In March, steel shipments decreased by 18.9% y/y to USD 341 million. In terms of quantity, exports decreased by 14.9% to 250 thousand tons.
Industry representatives acknowledge that the tariffs have played a role in the decline, but say that the full extent of the impact will become clearer over time due to long-term contracts, fluctuating demand and general economic conditions.
Strategic Investment Steps by Korean Giants in the US
Preparing against protectionist trade policies, South Korean producers are developing new strategies to take long-term positions in the US market. Posco is reportedly considering becoming a partner in Hyundai Steel's planned USD 5.8 billion integrated plant investment in the US state of Louisiana. This possible cooperation could enable the two giant manufacturers to both survive in the US market and respond more quickly to global supply chains.
Decrease in Imports from China, New Tax Preparations
The South Korean steel industry is experiencing some relief domestically. Steel imports from China decreased by 19.7% to 679,853 tons in March. In the first quarter of the year, total imports originating from China decreased by 19% to 1.84 million tons.
The decline came just before the planned introduction of provisional anti-dumping duties on thick plate and hot rolled products imported from China, which could be as high as 38.02%. The anticipation of these taxes, which have not yet been implemented, and weakening demand have slowed shipments by Chinese manufacturers.
Expectations Remain Uncertain
The effects of the US' aggressive trade policies will become clearer in the coming months. The industry predicts that Korean producers will turn to new strategies both to compensate for the loss of exports and to gain resilience against fluctuations in the global market.
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