Not trade barriers, domestic market conditions also prevent Chinese steel from reaching US, but reduced growth from protectionism will lead to a bigger threat of demand destruction
In the latest salvo between the two warring titans, the US House of Representatives recently passed a $716-billion Defence appropriations Bill that includes language to tighten regulations on Chinese investments in the United States and prohibits the US government from buying products from major Chinese telecoms firms, including ZTE.
In the longish stand-off which the world has been witnessing between the United States and China, who will be the bigger loser? Does rising protectionism impact China despite being the giant it is in terms of its hold on global markets and the size of its domestic consumption?
Putting aside the S232 and S301 tariffs (brought on by the Trump administration) for the moment, there are currently around 430 active anti-dumping (AD) or countervailing duty (CVD) orders in place by the United States government.
Around 128 – or almost a third of these – relate to iron and steel mill products. If we include pipes and other steel products, then the number rises to 223 or a little over half of all cases.
If we track the countries which have cases against them, and the number of those cases currently in place then we will see that most have been levied against China, with 16 currently in place, and 26 if we include Taiwan within this bracket. Of these 26, there are 18 AD orders and 8 CVD orders. Behind China, South Korea has 16 orders against it, India 13, Japan 11 and Brazil 6 amongst the top of the table.
“So I think it’s fair to say that Asian exporters of steel products have been targeted, though others in Europe and other continents have been too, including Turkey, Italy, South Africa, Russia, and closer to home, Brazil,” remarked Chris Houlden, Research Manager, CRU, while speaking at a recent steel conference organised by mjunction services limited.
This story is from the August 2018 edition of Steel Insights.
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This story is from the August 2018 edition of Steel Insights.
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