CRU: Rising protectionism impacts global steel trade

US domestic sheet prices rose substantially month over month (m/m) as the announcement that Trump will reset Section 232 tariffs has caused a strong rebound in buying activity. Section 232 tariffs will be reinstated on March 12, placing 25% tariffs on all steel imports without any exceptions by country or company In addition to the new trade actions, stronger seasonal restocking over the past month also supported US sheet prices.

Longs import volumes into the US rose significantly in January, largely for rebar and wire rod on the back of tariff fears and tighter domestic wire rod supply, as Liberty Steel’s continued outage kept domestic availability limited.

Despite the price uptrend in the US market, Brazilian slab export prices remained stable m/m, as exporters confidence was impacted by the news that the previous tariff exemptions secured by the country will end on March 12.

Potential trade restrictions continue to limit EU import demand

European domestic sheet prices increased m/m, driven by seasonal restocking demand. Despite the higher regional prices, interest for imports remained subdued due to the ongoing review of trade restrictions by the European Commission and the potential risk of retroactive tariffs.

An antidumping investigation into HR coil imports from India, Japan, Vietnam and Egypt and a safeguard review are currently under way. The antidumping preliminary duties are expected to be announced on April 7 while the safeguard review is set to conclude by the end of the quarter, with any changes taking effect from April 1.

The uncertainty over impending tariffs limited European buyers’ interest in imports even though landed imports were available at a large discount. As of this week, the landed price of Indian HR coil imports to the EU was $70 /t below Italian local prices.

In Turkey, HR coil export prices declined over the past month as pressure on producers increased due to weakness in both domestic and overseas demand. In contrast, Turkish rebar export prices rose m/m supported by restocking activity in the domestic market, as well as higher scrap and billet prices.

APAC steel prices move variably amid slow demand recovery in China

In China, steel export prices edged up before the Lunar New Year. However, prices have been trending down since the market opened post holidays as domestic demand recovery has been slow.

In addition, futures prices retreated amid concerns about the reinstatement of Section 232 tariffs by the US. The slight depreciation of the yuan against the US dollar following this announcement also enabled Chinese exporters to lower offers.

In India, sheet export prices declined m/m impacted by the ongoing antidumping investigation in the EU and strong competition from Chinese offers in the Middle East. In Southeast Asia, sheet import prices have jumped significantly due to the absence of new offers from China amid Vietnam’s ongoing antidumping investigation into Chinese imports.

Editor’s note

This was first published by CRU. To learn about CRU’s global commodities research and analysis services, visit www.crugroup.com. Have any questions? Reach out to the author at josh.spoores@crugroup.com.