uploads///steel imports

U.S. Steel Brings Steel Industry Woes to Congresspeople

By

Mar. 27 2015, Updated 3:06 p.m. ET

Steel industry woes

Previously in this series, we saw that U.S. Steel’s (X) share price has taken a beating on Wall Street over the last couple of months. The same is true for other steel companies, like Companhia Siderurgica Nacional (SID) and Timken Steel (TMST). The macro environment has been quite challenging for steel companies. A slowdown in global steel consumption, largely driven by China, has negatively affected the US steel industry.

Article continues below advertisement

Rising imports

On March 26, top executives of U.S. Steel, Nucor (NUE), and ArcelorMittal (MT) presented their case before a team of congresspeople from major steel-producing states. In particular, they briefed the congresspeople on the surge of steel imports in the United States.

Steel imports as a percentage of domestic consumption have reached alarmingly high levels. The chart above shows the increase in US steel imports. More steel imports have also negatively affected the performance of the SPDR S&P Metals and Mining ETF (XME). It’s ~35% invested in steel plays.

Anti-dumping duties

The Department Of Commerce (or DOC) had imposed anti-dumping duties on steel imports from several countries. One of the most important trade actions was the imposition of anti-dumping duties on “oil country tubular good” (or OCTG) products from Korea. The US International Trade Commission also ratified the DOC ruling. Steel imports, however, continue to increase.

A massive increase in steel imports has been the single biggest risk for the US steel industry. U.S. Steel faces challenges in its tubular segment also. The segment produces OCTG products. These products are used by the energy industry. Tenaris (TS) is also a leading supplier to the energy sector. In the next part of this series, we’ll discuss how U.S. Steel’s tubular segment faces turbulent times.

Advertisement

More From Market Realist

  • SemiLEDS logo over LED lighting
    Company & Industry Overviews
    There's Still Time to Get in on SemiLEDS (LEDS) Stock
  • Trader on the NYSE
    Company & Industry Overviews
    What Are the Most Expensive Stocks Ever?
  • Michelob Ultra beer
    Company & Industry Overviews
    AB InBev Is the Top Beer Brand Worldwide—Is It a Monopoly?
  • Businesswoman looking out a window
    Company & Industry Overviews
    Shifting Focus: Three Women Investing Funds in 2021
  • CONNECT with Market Realist
  • Link to Facebook
  • Link to Twitter
  • Link to Instagram
  • Link to Email Subscribe
Market Realist Logo
Do Not Sell My Personal Information

© Copyright 2021 Market Realist. Market Realist is a registered trademark. All Rights Reserved. People may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.