U.S. steel imports tumble in May
Date: Monday, July 2, 2018
Source: American Shipper
Steel imports to the United States tumbled 16 percent in May to 2.89 million net tons, according to the latest figures from the American Institute for International Steel.
Of that total, U.S. companies purchased 710,000 net tons of steel from Canada, 585,000 net tons from the European Union, 364,000 net tons from Mexico, 293,000 net tons from Brazil, 110,000 net tons from South Korea and 114,000 net tons from Russia.
Volumes from South Korea and Russia were both down roughly two-thirds from May 2017 levels, while steel imports from Brazil were down more than 50 percent year-over-year. Steel imported from the EU, on the other hand, grew 22 percent and Canada and Mexico volumes were 25 percent each compared with the same month a year ago.
AIIS attributed the erratic market behavior — with import volumes from some regions plummeting while others rose significantly — primarily to the May 1 imposition of a 25 percent tariff on imports of steel to the United States. President Donald Trump announced the tariff in March following a Commerce Department investigation that found global imports of steel pose a threat to national security.
South Korea negotiated a deal with the Trump administration that swapped the tariff for a quota that will similarly limit import volumes, while imports from Russia and Brazil fell simply due to the increased price for U.S. buyers. The EU, Canada and Mexico were granted temporary exemptions from the additional duty and, according to AIIS, U.S. firms were stocking up in May in order to avoid paying more when those exemptions expired on June 1.
Through the first five months of 2018, steel imports have now fallen 2.5 percent year-over-year to 15.34 million net tons.
“The administration will probably celebrate the May data, but businesses and consumers will not,” AIIS said in a statement. “Adding 25 percent to the cost of nearly every ton of steel that is brought into the country is a shortsighted tactic that will do long-term harm to the U.S. economy.
“That is why the American Institute for International Steel is going to court to challenge the tariffs and the faulty national security rationale that is being used to justify them,” it added. “This administration may be unwilling to listen to economic arguments, but it will not be able to ignore legal ones.”
AIIS earlier this week filed a lawsuit in the U.S. Court of International Trade in New York City challenging the constitutionality of Section 232 of the Trade Expansion Act of 1962, the statute under which Trump is imposing the tariff.
The lawsuit alleges no wrongdoing on the part of Trump and his administration in imposing the tariff, nor does it take issue with Commerce’s finding that steel imports pose a potential threat to national security.
Rather, the plaintiffs argue that the statute itself violates the constitutional prohibition against Congress delegating its legislative powers to the president because it lacks any “intelligible principle” to limit the discretion of the president.
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