Wire rods that could not be shipped are piled up in the wire rod warehouse within POSCO Pohang Steelworks, Jecheol-dong, Nam-gu, Pohang-si, Gyeongbuk. [Image source=Yonhap News]
The steel industry is facing a challenging environment due to factors such as the super weak yen, global oversupply, and strengthened protectionism, prompting the government and industry to come together to devise countermeasures.
On the 17th, the Ministry of Trade, Industry and Energy held a 'Steel Export and Import Issue Review Meeting' at the Korea Chamber of Commerce and Industry in Jung-gu, Seoul, attended by seven steel companies including POSCO, Hyundai Steel, Dongkuk Steel, SeAH Steel, Nexteel, and Korea Steel, as well as the Korea Iron & Steel Association.
Recently, the steel industry has been struggling due to increased steel exports from China, heightened tariff barriers in major countries such as the United States and Latin America, and the weak yen.
In particular, China triggered a global oversupply by exporting surplus steel at low prices to overseas markets after domestic steel demand declined due to a slowdown in its construction sector. According to the Ministry of Trade, Industry and Energy, China's steel exports increased by about 40% last year compared to the previous year.
For these reasons, the United States recently decided to raise tariffs on Chinese steel products from the current 7.5% to 25% under Section 301 of the Trade Act, thereby increasing tariff barriers.
Earlier, Chile in Latin America also decided to impose anti-dumping duties of up to 33.5% on Chinese steel after its domestic steel industry faced difficulties such as production halts due to the low-priced Chinese steel offensive.
Domestic companies are also struggling against the low-priced Chinese steel invasion and the competitive Japanese steel products backed by the weak yen.
At the meeting, the Ministry of Trade, Industry and Energy listened to opinions from the steel industry and discussed ways to maintain competitiveness against the Chinese steel offensive. While the steel industry agreed that low-priced Chinese steel products are disrupting the domestic market order, it is reported that they remain cautious about actively responding through measures such as anti-dumping petitions.
Lee Seung-ryeol, Director of Industrial Policy at the Ministry of Trade, Industry and Energy, said, "The government will actively respond to trade issues affecting the domestic steel industry through dialogue with major countries and will establish a system that allows fair competition with foreign steel companies in the mid to long term."
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
