BEIJING/SINGAPORE, Apr 19 (Reuters): US President Joe Biden's push to triple tariffs on Chinese steel imports strikes a mostly symbolic blow on an industry facing bigger concerns over faltering local demand and threats of even stronger blowback against China's surging exports.
Steel consumption in the world's second-largest economy is poised to shrink again this year as a protracted property crisis has yet to find bottom and as infrastructure demand growth slows after 12 indebted regions were ordered to halt certain projects.
The state-backed China Metallurgical Industry Planning and Research Institute (MPI) forecasts a 1.7 per cent drop in China's steel demand this year, following a 3.3 per cent decline in 2023.
While China's steel exports last year climbed more than a third to their highest since 2016 at 90.26 million metric tons, about 9 per cent of its total crude steel output, just 598,000 tons of the shipments went to the United States. That was down 8.2 per cent from volumes shipped to the US the previous year and less than 1 per cent of total Chinese steel exports worth $85 billion in 2023.
China, the world's biggest producer and exporter of steel, is just the seventh-largest shipper of steel to the US, softening the blow of Biden's proposal to raise to 25 per cent the tariffs imposed by his predecessor Donald Trump on certain steel and aluminium products.
"We do not think there will be any big impact as the main destinations for China's steel exports are Japan, South Korea, and Middle East countries," said an analyst at a China-based steel trader who declined to be named as he was not authorised to speak with media.
Spurred by low local prices, Chinese steelmakers and traders are on track to match or surpass last year's exports, with domestic information provider Lange Steel lifting its forecast to more than 100 million tons for 2024 after March shipments beat expectations.
China's cheap steel products are also stoking complaints from beyond the United States.
Late last year, India imposed anti-dumping duties on some Chinese steel imports while Mexico announced a nearly 80 per cent tariff. Thailand has launched a probe into Chinese rolled steel imports, and Brazilian steelmakers are urging their government to impose a 25 per cent tariff on imports.
A report from a Chinese state-backed research agency identified a total of 112 statements from countries regarding anti-dumping and anti-subsidy moves on Chinese steel products in 2023, a rise of around 20 from 2022.
"We are expecting more trade frictions this year," said David Cachot, research director at consultancy Wood Mackenzie.
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