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Will Steel Be on the Agenda in the Upcoming G20 Meeting?

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Part 2
Will Steel Be on the Agenda in the Upcoming G20 Meeting? PART 2 OF 6

Steel Imports or North Korea: Which Is a Bigger Security Threat?

National security

As we noted in the previous article, President Donald Trump’s administration has ordered a Section 232 investigation to discover whether steel imports are a threat to US national security. A similar probe has been launched into aluminum imports as well. Steel does find its way into some defense applications, but according to a BloombergQuint report citing Jefferies, national defense accounts for only about 3% of US steel consumption (MT).

Steelmakers including U.S. Steel Corporation (X), AK Steel (AKS), and Nucor (NUE) rallied after the probe was announced in April 2017. Steelmakers again saw upward price action in June amid reports that the probe would be completed much sooner than the maximum stipulated period of 270 days.

Steel Imports or North Korea: Which Is a Bigger Security Threat?

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North Korea

We’ll have to wait for the results for the Section 232 probe to find out whether steel imports are a threat to US national security. However, there’s another burning issue that looks like a real security threat to the United States (SPY) (SPX-INDEX).

Just as Americans were getting ready to celebrate Independence Day, North Korea did a test launch of a ballistic missile. According to North Korea, it was an intercontinental ballistic missile. According to some reports, the missile is capable of reaching Alaska.

North Korea doing a weapons test around key global events is nothing new. The country’s pursuit of weapons—both conventional and nuclear—represents a challenge to the United States. In the G20 meeting, we could see a tough line drawn on North Korea’s missile program.

Is there a connection between North Korea and the US steel import probe? We’ll find out in the next article.

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