AIIS Sees Continued Decline in Steel Imports Due to Falling Oil Prices

The most notable decrease was in imports from South Korea, which fell 10.6 percent from November to 418,000 net tons. Russia had the most significant increase – 28.7 percent to 376,000 net tons, which was more than double the December 2013 total. Several of the United States’ major Western Hemisphere trading partners increased their steel shipments to the U.S., with Canada up 3.4 percent to 487,000 net tons, Brazil 7.2 percent to 430,000 net tons, and Mexico 2.3 percent to 270,000 net tons. Imports from the European Union, however, fell 5.2 percent to 677,000 net tons. Steel imports from Japan, meanwhile, increased nearly 16 percent to 225,000 net tons.

For all of last year, imports of 44.32 million net tons were 37.8 percent higher than they were in 2013. Canada accounted for more than any other single country – 6.05 million net tons, 10.4 percent more than a year earlier. South Korea was next at 5.48 million net tons (a 43.7 percent increase), followed by Brazil at 5.03 million net tons (20.8 percent), Russia at 4.69 million net tons (152.7 percent), and Mexico at 3.71 million net tons (16.2 percent). Imports from the European Union increased 46.8 percent to 7.14 million net tons.

Semifinished imports totaled 679,000 net tons in December, up nearly 10 percent from a year earlier, and 10.59 million net tons in 2014, up 44.6 percent from the previous year.

Notwithstanding the slowdown in November and December, 2014 was clearly a strong year for steel imports. This resulted, at least in part, from a strengthening U.S. economy and sluggish economic performance in many other parts of the world. We may see some significant changes in the U.S. energy sector in 2015, though, as falling oil prices lead companies to roll back drilling and fracking projects, reducing the demand for oil country tubular goods and line pipe. This could mean that the downward trend in steel imports that started in November will continue, and, when combined with weak demand outside the United States, this has the potential to push down the global price of steel this year.