Imports of steel, which have been a pressing problem faced by the beleaguered American steel industry, dropped roughly 8% from the previous month in August, according to the American Iron and Steel Institute ("AISI"). The decline – a positive for the domestic steel industry – follows a roughly 5% rise in July.
AISI – an association of North American steel makers – said that, based on preliminary U.S. Census Bureau data, total U.S. steel imports for August was 3,016,000 net tons, an 8.2% decline from a month ago. That number includes finished steel imports of 2,439,000 net tons, which also fell 6.7% from July.
Market share of finished steel imports also fell on a monthly basis in August. Estimated market share of finished steel imports for the month was 26%, down from 27% in July. But year-to-date finished steel import market share was estimated at 31%, which is still higher than 28% recorded for full-year 2014.
The U.S. steel industry saw a year over year rise in finished steel imports for the first eight months of 2015. Finished steel imports for the period went up 7% year over year to roughly 22.91 million net tons. However, total imports for the same period fell 2% to around 28.02 million net tons.
Major finished steel products that showed a significant import increase on a monthly comparison basis in August are wire rods (up 45%), hot rolled sheets (up 29%), oil country goods (up 15%) and standard pipe (up 14%).
Biggest volumes of finished steel imports in August were from South Korea with 303,000 net tons (down 1% from July), Japan with 215,000 net tons (up 20%), Brazil with 211,000 net tons (up 124%), China with 157,000 net tons (down 45%) and Turkey with 153,000 net tons (down 41%).
Three biggest offshore suppliers for the eight-month period were South Korea with 3,670,000 net tons (up 1% year over year), Turkey with 2,020,000 net tons (up 55%) and China with 1,961,000 net tons (down 3%).
While the August import data paints an encouraging picture, the U.S. steel industry remains under the threat of cheaper imports in the wake of a stronger dollar.
American steel producers are still struggling to defend themselves against an influx of cheap steel imports from foreign manufacturers. A recovering economy coupled with a mightier greenback has made the U.S. a dumping ground for unfairly-traded, subsidized steel. Cheap imports are still flowing into the American market due to foreign producers’ overcapacity.
Steel products are being illegally dumped by foreign producers in the U.S. market at unfairly low prices that significantly undercut the prices of domestic steel makers. Low costs of production have enabled overseas producers to sell their products at cheaper rates, leading to an industry-wide price decline, hurting margins of U.S. steel makers.
China, which has built up a massive excess steel capacity, continues to pose a serious threat to the U.S. steel industry. China’s move to devaluate its currency has triggered fears of accelerated steel exports from the country amid waning domestic demand.
China’s steel exports swelled 26.5% year over year to 71.87 million tons in the first eight months of 2015, per data released by the General Administration of Customs. According to Global Trade Information Services, Chinese steel exports are expected to top 100 million metric tons in 2015. China – the world’s top steel producer – accounts for around half of global steel output.
Major U.S. steel producers including Nucor NUE, U.S. Steel X, AK Steel AKS, Steel Dynamics STLD and ArcelorMittal USA – a part of ArcelorMittal MT – have taken a series of steps (in the form of anti-dumping and countervailing duty petitions) in the recent past in their ongoing efforts to repel the tide of cheap imports.
American steel makers, last week, cheered the U.S. International Trade Commission’s (USITC) preliminary determination of injury on a trade case that was filed In August. The USITC found reasonable indications that a barrage of subsidized imports of certain hot-rolled steel flat products from seven countries is causing material injury to the U.S. steel industry. Earlier this month, the USITC also concluded that imports of certain cold-rolled steel flat products from seven foreign producers are causing or threatening to cause significant injury to the domestic industry.
U.S. steel makers continue to actively press Congress to stop unfair trade practices and enforce new trade laws to rescue the struggling American steel industry.
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