Vietnam which has become one of the major destinations of steel exports especially over past two years is finding itself in a fix after the U.S. government’s announcement of steep tariffs on steel imports in the month of Mar’18.
These tariffs announcement by U.S. irked trade war between majority of nations as on 18 July EU (European Union) also announced temporary safeguard measure for 200 days in the form of quota on 23 categories of steel products imports from all the countries at an average of imports over the past three years, with a 25% tariff set for volumes exceeding those amounts.
On July 24, the Canadian International Trade Tribunal (CITT) released a final judgment about imported cold-rolled coil (CRC) steel from China, South Korea and Vietnam for domestic steel manufacturing.
The judgment was made based on the results of an investigation conducted in accordance with SIMA (Special Import Measures Act) and an investigation by CBSA (Canada Border Service Agency). CITT stated that there were signs of dumping and subsidizing cold-rolled steel products, which harms and threatens the Canadian domestic steel industry.
Currently, CBSA is carrying out a probe on whether the cold-rolled steel from the three countries is being dumped in the Canadian market and the final decision is expected to be released on 20 Aug’18.
Besides cold-rolled steel, CITT and CBSA are also investigating some carbon welded steel pipe products from Vietnam, the Philippines, Pakistan and Turkey. The final decision on the same is expected to be released on 18 Sep and 18 October 2018 from CITT and CBSA respectively.
In July 2018, DFT (Thai Department of Foreign Trade) initiated an investigation for the second extension of safeguard measures against non-alloy steel sheets. According to the Ministry of Industry and Trade, Vietnam is excluded from the list of countries subject to the safeguard measures because of the insignificant amount of exports. However, in the second investigation, if Vietnam’s exports account for more than 3% of Thailand’s total imports, DFT may not exclude Vietnam from the list.
Apart from tariffs announcement on steel imports from all the countries by U.S., in mid-June 2018, some steel manufacturers in the U.S. filed requests for investigating and applying measures to prevent circumvention of anti-dumping and anti-subsidy duty by non-corrosion steel imports from Vietnam.
The steel manufacturers alleged that after the U.S. carried out the anti-dumping and anti-subsidy investigations in 2015, steel imports from South Korea and Taiwan decreased, while imports from Vietnam increased rapidly. The manufacturers also accused Vietnam of importing hot-rolled steel from Taiwan and South Korea to manufacture products and supplying the same to U.S.
Subsequently, amid many anti-dumping investigations, Vietnamese steel manufacturers are experiencing hardships in exporting their products both via direct and indirect routes.
Also, amid rising trade tensions between U.S. and China, VSA (Vietnam Steel Association) has warned its steel manufacturers to not let Chinese exporters to change the product origin from China to Vietnam.
In 2017, Vietnam exported about 3.75 MnT of steel in 2017 recording a growth of 34% y-o-y basis whereas the country’s steel exports during Jan-May’18 surged by 61% y-o-y basis and are recorded at 1.91 MnT worth USD 1.4 billion. However as various protectionism measures on steel have been announced in June-July, their impact on Vietnam’s steel exports is likely to be seen the second half of 2018.
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