Steel Pipe Companies Preparing for Trump Tariff Bombardment... Dark Horse in the 59 Trillion Won Energy Steel Pipe Market

SeAH Steel Hits 52-Week High
Domestic Steel Pipe Stocks Surge on U.S. Tariff Policy
Trump's Energy Policy and Import Tariffs Drive Up OCTG Prices
Local Production in the U.S. Helps Korean Companies Respond
Husteel and Nexteel Also Benefit from Rising U.S. Demand

The stock prices of seamless pipe manufacturers in the domestic stock market have been rising this year. Major domestic steel pipe companies such as SeAH Steel, Nexteel, and Husteel have already established or are constructing local production systems in response to U.S. import regulations.

This appears to be influenced by the sharp rise in steel prices, especially OCTG (Oil Country Tubular Goods) prices, in the U.S. following President Donald Trump's signing of an executive order imposing a 25% tariff on steel imports. IMARC Research Group projected that the global energy steel pipe market size will grow at an average annual rate of 5.7%, from $24.5 billion (approximately 36 trillion KRW) in 2023 to $40.7 billion (approximately 59 trillion KRW) by 2032.

According to the financial investment industry on the 4th, SeAH Steel's stock price has risen 42% since the beginning of this year. On the same day, SeAH Steel reached 172,000 KRW, setting a 52-week high. Nexteel and Husteel also rose 64% and 48%, respectively, this year.

SeAH Steel operates ‘SeAH Steel USA’ in Houston, Texas, capable of producing 250,000 tons of steel pipes.

Yujin Lee, a researcher at Eugene Investment & Securities, explained, "Tenaris, a steel pipe manufacturer, stated in its earnings report that drilling activity in North America is stable this year," and "the OCTG consumption per drilling rig has increased." She added, "U.S. hot-rolled steel producers are raising prices, so the rise in OCTG prices is expected to continue for the time being," and explained, "Considering the assumption that U.S. OCTG prices will continue to rise and that quotas will be lifted, allowing volumes to gradually increase, we are revising upward SeAH Steel's earnings estimates."

President Trump's energy policy (Drill, baby, drill) is expected to expand fossil fuel development in the U.S. The executive order imposing a 25% tariff on steel will take effect on the 4th. Reflecting concerns over reduced imports, U.S. OCTG prices have risen 30.6% compared to before the signing. President Trump has urged the construction of the Keystone Pipeline. Approvals for various pipeline constructions are expected to accelerate.

Seongbong Park, a researcher at Hana Securities, said, "With the reduction of steel pipe imports into the U.S., further increases in domestic prices are possible," and explained, "If a uniform 25% tariff on Canada and Mexico is finally confirmed, these countries could face an additional 25% tariff on top of the existing 25% steel tariff, potentially resulting in a total tariff of 50%."

Husteel is building an API steel pipe plant in the U.S. primarily producing 72,000 tons of OCTG. Completion is scheduled for the first half of this year. It is expected to benefit from escaping U.S. import regulations. Husteel has purchased land considering expansion and is reportedly reviewing an expansion of 180,000 tons. Researcher Park expressed expectations, saying, "This year, Husteel's price-to-earnings ratio (PER) has fallen to around 3 to 4 times, highlighting its undervaluation appeal."

Nexteel established the ‘Nexteel SAHA’ steel pipe plant on a 100,000-pyeong site in Houston, Texas, in 2017. It mainly produces 2 to 5-inch sizes for North American shale gas.