SEOUL: South Korea’s Industry Ministry said on Monday (Jun 2) it will respond to the looming 50 per cent US tariff on steel products as part of its trade discussions with Washington in order to minimise the impact on industry.
US President Donald Trump said on Friday he planned to increase tariffs on imported steel and aluminium to 50 per cent from 25 per cent starting Wednesday, ratcheting up pressure on global steel producers and deepening his trade war.
South Korea is the fourth-biggest exporter of steel to the United States, behind Canada, Mexico and Brazil last year, according to American Iron and Steel Institute data.
South Korea’s Industry Ministry said in a statement that it had held an emergency meeting with officials from the country’s major steelmakers, including POSCO and Hyundai Steel .
Shares of South Korean steelmakers lost ground on Monday, with POSCO and Hyundai Steel falling 3 per cent and SeAH Steel Corp down 6.3 per cent in morning trade.
The 50 per cent tariffs will add challenge to Korean steel exporters which have refrained from sharply boosting exports to the US to avoid Washington scrutiny, despite rising US steel prices, an industry executive told Reuters.
“It will be a burden to exporting companies, if there are no additional steel price increases in the US,” he told Reuters, asking not to be identified due to the sensitivity of the issue.
Despite tariffs, South Korea’s steel shipments to the United States rose 12 per cent in April from a year earlier, according to trade data.
Steel and aluminium tariffs were among the earliest put into effect by Trump when he returned to office in January. The tariffs of 25 per cent on most steel and aluminium imported to the US went into effect on Mar 12.
Industry officials said the tariffs have increased steel prices in the United States, impacting several sectors, including home appliances, cars, and construction.
