2014 Steel Imports Outpace Declining Exports

Exports fell 2.3 percent month-to-month, and were 10.9 percent lower than they were in October 2013. The two major buyers of American steel – Canada and Mexico – both reduced their purchases in October, the former by 3.8 percent to 537,003 net tons, the latter by 1.2 percent to 348,804 net tons. Both marked double-digit decreases from the previous October. Exports to the European Union, however, increased by nearly 50 percent from September to 35,238 net tons, 28 percent more than a year earlier.

For the first 10 months of the year, exports were down 6.5 percent to 10,161,879 net tons. Exports to Canada, which represent more than half of the total, decreased 5.2 percent, while exports to Mexico, which account for more than one-third of the overall number, increased 1.5 percent. Notwithstanding the gains in October, exports to the E.U. are down 11.6 percent on the year. Year-to-date exports to nearly all of the United States’s’ minor trading partners have decreased significantly compared to 2013, with one notable exception being Venezuela, where exports have increased more than 88 percent to 53,972 net tons.

The decrease in exports in 2014 contrasts with a substantial increase in imports, which are up nearly 37 percent this year. There are several factors contributing to these two trends, including a U.S. economy that appears to be growing stronger while much of the rest of the world continues to struggle, massive exports from China, and the advantage that steel producers in many other countries have over domestic companies when competing on price. Such is the nature of a global market. The sale of steel – or any other commodity– is not a zero-sum game, however. Free trade is an economic force-multiplier that can shift the demand curve and benefit all producers, especially the most efficient ones.