U.S. President Joe Biden has ordered a threefold increase in tariffs on Chinese steel and aluminum, causing the stock prices of domestic companies expected to benefit from this to surge.
As of 10:13 a.m. on the 18th, Posco Steelion, a subsidiary of the Posco Group, was trading at 8,450 KRW, up 20.54% from the previous day's closing price. It initially hit the upper price limit before undergoing some correction. Posco Steelion produces and sells aluminum, zinc-coated steel sheets, and color steel sheets. It also owns a plating and color steel sheet subsidiary in Myanmar. Domestic production capacity is 960,000 tons, with Myanmar accounting for 70,000 tons.
High Steel, which manufactures steel pipe products, went straight to the upper price limit from the start of trading, triggering the Volatility Interruption (VI) mechanism. Aluminum manufacturers Joil Aluminum (11.46%), Sama Aluminum (8.46%), and Namseon Aluminum (7.33%) also showed sharp gains.
Small and medium-sized steelmakers Daedong Steel (23.84%), Shin Steel (21.38%), and Geumgang Steel (13.37%) also recorded significant increases. Munbae Steel (6.14%), Nexteel (4.67%), KG Steel (7.06%), TCC Steel (7.66%), and Buguk Steel (3.17%) were also on the rise.
The White House announced on the 17th (local time) that President Biden instructed the U.S. Trade Representative (USTR) to consider implementing a policy to raise tariffs on steel products, criticizing China’s unfair trade practices.
The average tariff on certain Chinese steel and aluminum products is currently 7.5%, but the rate directly recommended by President Biden is reported to be as high as 25%.
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