US steel imports
US steel companies filed a series of trade cases last year to stem the flow of imported steel products into the United States. State support of steel mills in countries such as China and India has been cited as a frequent reason that US steel companies are finding it hard to compete.
Acting on the complaints of steelmakers, the US Department of Commerce has imposed preliminary duties on three key steel product categories: hot rolled, cold rolled, and corrosion-resistant steel products. Among the steelmakers that made complaints to the Department of Commerce are U.S. Steel Corporation (X), AK Steel (AKS), Nucor (NUE), and ArcelorMittal (MT).
The impact of these duties and aggressive stance of US steel companies in filing more trade cases is visible in the steel imports data. In February 2016, US steel imports fell to a four-year low, as you can see in the graph above. Let’s now see how steel imports played out in March.
According to the preliminary data released by the US Census Bureau, the country imported 2.3 million metric tons of steel products in March. This is 16% above the February preliminary imports and 13% more than the February final steel imports.
Although March steel imports represent a year-over-year (or YoY) decline of almost 29%, the YoY decline in steel imports has been pretty much factored in by the Market.
Markets (OEF) are more interested in seeing how steel imports change month-over-month. On the face of it, the increase in March steel imports as compared to the previous month could be an alarming sign for US steel industry. However, a breakdown of March steel imports data tells us that higher imports are not really a cause of worry. Continue reading the next part of this series to explore this in detail.