Steel Prices: US Steel Import Investigation Findings Pending

The U.S. Commerce Department’s report on its investigation into whether cheap steel imports are a matter of national security could be released in a matter of days.

The Section 232 investigation, part of the Trade Expansion Act of 1962, allows the president to implement tariffs or penalizing quotas on imports if it is found that they pose a threat to national security. In the case of the steel investigation, the argument is that cheap steel imports have hurt America’s ability to make steel products essential to national security.

While the end result of what to do with the investigation is in the president’s hands, the Trump administration has already indicated that it will take action once it receives the Commerce Department’s report.

The investigation is garnering the attention of trading partners around the globe. European members of Nato have mounted a lobbying campaign against the expected crackdown on steel imports, arguing it will hit American allies rather than the intended target: China. According to The Financial Times, in private conversations, the European members have discussed retaliation including targeting US agriculture exports and/or they could lodge a complaint with the World Trade Organization.

Officials from Canada and Mexico have also been seeking an exemption from any new tariffs. With the North American Free Trade Agreement to be renegotiated, any sudden moves from the Trump Administration could backfire. The trading relationship between the US and Canada has become strained in the recent weeks after Texas lawmakers passed a “Buy American” bill that could negatively impact Canadian steel companies.

Leia Toovey has a B.Sc. in geology from Simon Fraser University, and her degree had a focus on resource economics. Out of school, she started working in the booming mining industry of Vancouver, Canada, covering junior mining stocks and commodities including potash, copper, nickel, oil and gold. Then she moved to New York and worked as a commodities analyst covering a breadth of commodities, from the Baltic Dry Index through the softs. As a geologist she has a greater understanding of the exploration and extraction side of commodities, and how changes in technology and the depletion of resources impact pricing. At Economic Calendar she covers a variety of commodities, providing daily technical and fundamental analysis and assessing major market developments.