2018 - Will Political Risks Trump Steel Cycles?

The year 2017 proved a bit “odd” as the threat of political action against foreign steel worked against the domestic steel mills. Early in the year, newly crowned President Trump authorized the U.S. Department of Commerce, led by former steel magnate Wilbur Ross, to investigate if the steel industry is essential to the U.S. for reasons of national security, and thus should be shielded from unfairly traded foreign imports.

Although supported by the U.S. steel mills, the Section 232 investigation was not requested by the domestic producers who had already won victories utilizing antidumping and countervailing duty rulings on corrosion resistant, cold rolled, hot rolled and plate steels during calendar year 2016. Those rulings took monthly foreign steel imports, which had been as high as 4 million net tons, down to 2.4-2.6 million tons in the second half of 2016.