As per the latest updates, U.S. has raised import tariffs on galvanised steel plates coming from South Korea in its preliminary ruling.
On August 8, the U.S. Department of Commerce imposed a 10.32% preliminary tariff on Hyundai Steel’s galvanized steel plates in an annual review. The tariffs have been risen by 2.43% against the previously imposed original trial whereas tariffs on the products of Dongkuk Steel has been reduced from 8.75% to 4.14%.
Galvanized steel plates are post-processed cold-rolled steel sheets mainly used as steel sheets for automobiles and exterior building materials.
Hyudndai Steel usually supplies galvanised plates to its sister concern Hyundai Motors Alabama plant and another company called Kia Motors in Georgia in U.S. Thus higher tariffs on Hyundai Steel will add to the burden on Hyundai Motor and Kia Motors as well as Hyundai Steel itself. On the other hand, Dongkuk Steel has been stepping up its efforts to lower the tariffs further, as the U.S. market accounts for 10% of its total sales.
After the U.S. government announced 25% tariffs on steel imports in the month of Mar’18, South Korea and U.S. entered into an agreement where South Korea received a quota of about 2.68 MnT of steel exports, or 70% of the annual average Korean steel exports to the United States between 2015-2017 and became the first ally of U.S. to receive exemption from steep tariffs of 25%. However, this increase in import tariffs on galvanised steel plates means that the duty will be imposed on the galvanised plates quantity imported under quota imposed.
Korean steelmaker cannot be rest assured that this will be the final rate of tariffs until next review as unlike a preliminary ruling in which the U.S. Department of Commerce determines a tariff rate based on submitted documents, the U.S. Department of Commerce carries out a due diligence inspection for the final ruling and it is being anticipated that tariffs may surge in the final judgement.
In 2017, Korean steel companies exported USD 440.61 million worth of galvanized steel sheets to U.S. According to the data with SteelMint, in terms of volume, South Korean exports of galvanised steel were recorded at 6.84 MnT with exports to U.S. being recorded at 0.52 MnT (7.63% in S.Korea total galvanised steel export). In 2016, U.S. was the second highest importer of South Korean galvanised steel with quantity being recorded at 0.65 MnT (9.95%).
In 2018 from Jan to Jul’18, South Korea exported about 4.18 MnT of galvanised steel plates with 0.26 MnT being supplied to U.S. (6.15%). For U.S., South Korea is the third largest galvanised steel exporter in 2017, whereas it inched down to the fourth rank during the first seven months of 2018.
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