Trumped: How Seoul’s U.S. trade ‘coup’ left Korea steel in limbo as Japan marches on

SEOUL/TOKYO (Reuters) – As much as half of output capacity at some specialty South Korean steelmakers has ground to a standstill as an exemption to U.S. import tariffs they first hailed as a Seoul diplomatic coup turns out to be an quota bottleneck. Production lines are standing idle, people with knowledge of the matter say, even as data shows Japanese steel pipe makers have expanded U.S. exports despite having to cope with 25 percent tariffs. Japanese players have been boosted by offering high-tech pipes for the U.S. oil industry amid an output boom that can’t be easily be substituted by U.S. manufacturers, unlike Korean firms’ goods. South Korea was the first country to score the exemption back in March, agreed as President Donald Trump set out to level the manufacturing playing field with the rest of the world. The deal meant continued, tariff-free access to Korean steel’s 3rd-biggest export market. But what should have been a boon for specialty pipe exporters like Nexteel, Husteel (005010.KS) and Seah Steel (003030.KS) turned bust: The quota for 2018, set nearly a third below previous years’ volumes, was almost already used up by May when the new system kicked in, leaving Nexteel and Husteel… continue reading

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