SEOUL, Mar. 9 (Korea Bizwire) — South Korean steel exports to the United States will take a big hit from Washington’s move to slap heavy tariffs on imported steel, local industry sources said Friday.
Defying threats of retaliatory measures from major economies, U.S. President Donald Trump signed orders imposing 25 percent tariffs on steel imports, excluding those from Canada and Mexico. The move will go into effect in 15 days.
“We are worried about what will happen,” an industry source said on customary condition of anonymity. “When the tariffs are in place, it will deal a harsh blow to local steelmakers’ profitability and exports.”
Another source echoed his view.
“It will surely come as a big burden to steelmakers already struggling to cope with high U.S. import duties levied on their exports,” the source said.
America has already slapped anti-dumping and countervailing tariffs on 88 percent of South Korean steel products exported to the world’s largest economy.
With growing tariffs, South Korean exports of steel products to the U.S. came to 3.54 million tons in 2017, down a whopping 38 percent from three years earlier.
Currently, POSCO, South Korea’s leading steelmaker, is subject to import duties of 66.04 percent and 62.57 percent on its cold-rolled steel sheets and hot-rolled steel sheets, respectively.
The U.S. has also imposed import tariffs of 38.22 percent on cold-rolled steel sheets produced by Hyundai Steel Co.
In October last year, Washington imposed duties of up to 46.37 percent on oil country tubular goods — pipes and tubes for oil and gas drilling — manufactured by Hyundai Steel Co.
Nexteel, Seah Steel Corp. and Husteel are expected to be hit hard by the U.S. imposition of fresh tariffs as the companies depend heavily on America for their exports.
According to sources, local steelmakers are pinning their hopes on Seoul’s expected negotiations with Washington. Trump said the U.S. is willing to negotiate with any country on a possible exemption from the move during the 15-day period.
The sources expressed worries that South Korean steelmakers would be hit hardest, should Seoul not be exempted from the tariff imposition amid the exclusion of rival countries.