UK steel firms cautious ahead of Trump export investigation
(ShareCast News) - Steelmakers in Britain are on alert as Donald Trump launches an investigation into steel dumping in the US and suggested new tariffs will be levied on imports.
The US President cited issues of national security during the announcement, which was made at the White House with a host of US steel executives present.
A group representing the UK's steel firms warned of the potential damage to the industry if such tariffs are introduced, with £350m worth of steel being delivered to the US annually. With the impact of Britain's impending departure from the EU, to which the firms send 70% of their exports, steel firms are wary of their ability to compete in the near future.
"Whilst the full details of the scope of this investigation are still unclear, this is undoubtedly a worrying development," said UK Steel Director Gareth Stace. "The UK sector is entirely supportive of measures taken to tackle dumping of steel products and unscrupulous trading practices but this move has the potential to go much further than necessary."
China has often been accused of importing vast amounts of steel to the US, undercutting domestic producers. However, Trump denied that the investigation was specifically targeted towards China.
A statement released by the commerce department affirmed that "the artificially low prices caused by excess capacity and unfairly-traded imports suppress profits in the American steel industry".
Stace added that a trend towards such trade policies would ultimately harm global trade in the long run.
"Trade defence instruments must be seen as a last resort to protect domestic industries and ultimately boost global free trade. This move at least has the potential to cross the line into protectionism which in the long term can only be harmful to the global sector."
Shares in United States Steel, Steel Dynamics, AK Steel Holding and Cliffs Natural Resources were among the corporations that rose strongly following the administration announcement.