Steel Prices: Macquarie Sees Further Pressure Due to Delayed Section 232 Findings

US steelmakers are still waiting on the findings of the U.S. Commerce Department’s Section 232 investigation into cheap steel imports. Even though these findings are already delayed by over two months, the Commerce Department continues to pursue additional trade suits.

On Wednesday, the U.S. Department of Commerce announced that it had started an investigation into possible dumping and subsidization of stainless steel flanges from China and India. Petitions filed by Core Pipe Products Inc of Illinois and Maass Flange Corp of Texas accused China of dumping steel flanges on the US market.

Meanwhile, while announcing this latest investigation, the U.S. Commerce Department on Wednesday said it made an initial finding that carbon and alloy steel wire rod from Belarus, Russia and the United Arab Emirates are being dumped in the U.S. market, and imposed duties of up to 756.93%.

Commenting on the decision, Commerce Secretary Wilbur Ross said in a statement: “The dumping of goods below market value in the United States is something the Trump administration takes very seriously.”

The trade action followed petitions filed on behalf of Gerdau Ameristeel US Inc of Florida, a unit of Metalurgica Gerdau SA, Nucor Corp of North Carolina, Keystone Consolidated Industries of Texas and Charter Steel of Wisconsin.

US steelmakers have been anxiously awaiting the results of the section 232 investigation, saying that a much tougher stance by the U.S. government when it comes to unfair trading practices is necessary for domestic steel makers to survive. US steelmakers shares have been under pressure amid the delayed 232 investigation, and Macquarie analysts David Lipschitz and Xiao Feng said that they believe near-term steel prices are likely to decline modestly due to the delay of Section 232 investigation.

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.