When politicians and steel bosses in the U.S. complain about cheap Chinese imports, they’re pointing at a flood that’s already receding.
Shipments of iron and carbon steel to the U.S. last year slumped by about a third from a record in 2014 -- the first decline in five years -- even as total exports surged more than 20 percent to the most ever, according to data from China’s customs authority. Southeast Asian countries are soaking up the biggest portion of the deluge, taking at least 40 percent of China’s additional shipments last year. Exports to Vietnam jumped 55 percent to 9.7 million metric tons, dwarfing shipments to the U.S. at 1.9 million tons for the year.
“The Chinese steel industry has always looked at Southeast Asia as a more promising market long term for them, rather than the U.S. which is a bit more opportunistic,” said Daniel Hynes, senior commodities strategist at Australia & New Zealand Banking Group Ltd. in Sydney.
Both Republicans and Democrats have cited steel imports from China in raising the need for more trade protection. China is dumping “tremendous amounts” of steel into the U.S. and the government is subsidizing it, the Republican presidential candidate, Donald Trump, said at a rally last August.
U.S. producers including Nucor Corp., U.S. Steel Corp. and Steel Dynamics Inc. filed cases in June alleging that some products from China, India, Italy, South Korea and Taiwan had been dumped in the U.S., harming domestic companies. In November, the government said all those countries, except Taiwan, subsidized their domestic production by as much as 236 percent of its price. Last month, the U.S. Department of Commerce found that corrosion-resistant steel imports from China were sold at unfairly low prices and would be taxed at 256 percent.