[Tariff Second Half] Steel Industry Faces Export Crisis Over 50% Tariff

Except for High Value-Added Products,
Most Exports Face Suspension
13.1% of Total Exports Go to the US
Industry Calls for Emergency Operating Funds
Requests for Domestic Logistics Cost Compensation
"Issue Must Be Readdressed at the Summit"

The steel industry is facing an emergency situation due to the United States' decision to maintain a high tariff rate of 50%. As export losses become a reality, voices are growing louder for diplomatic renegotiations as well as policy support measures. The industry is hoping that the issue of steel tariffs will be discussed at the upcoming South Korea-US summit, which is expected to be held in Washington, D.C. as early as mid-month.

Steel products are piled up at the export yard of Pyeongtaek Port, Gyeonggi Province. 2025.7.8. Photo by Kang Jinhyung

According to the industry on August 1, the previous day the United States decided to maintain a 50% tariff on Korean steel products, leading to a widespread demand for substantial support measures across the steel sector. The industry argues that government policy protection is necessary to ensure companies can survive in a situation where it is difficult to withstand export shocks. The prevailing view is that, under the current structure, most steel exports?except for high value-added products?are effectively on the brink of being suspended. For general hot-rolled or steel pipe products, the average profit margin is only around 10%. With a 50% tariff imposed, the analysis is that "the more you sell, the greater the loss."

For the domestic steel industry, the United States is an indispensable key market. According to the Korea International Trade Association, out of the total steel export value of $33.29 billion (about 46 trillion won) last year, $4.347 billion (about 6 trillion won), or 13.1%, was exported to the United States. POSCO exports 10% of its total exports to the US, while Hyundai Steel and SeAH Steel export approximately 33% and 36.5%, respectively, to the US market.

In the face of intensifying trade pressure, the industry is calling for emergency operating funds for export companies and compensation for domestic logistics costs. This is because the high tariff has blocked export routes, causing profitability to deteriorate rapidly and resulting in many small and medium-sized steel companies facing immediate difficulties in managing their finances. An industry official said, "Since we cannot give up on exports, we are forced to bear the losses," adding, "Government support to secure short-term liquidity is urgently needed." There are also concerns that if exports are blocked, excess supply will flood the domestic market, leading to a drop in steel prices and weakened bargaining power with client companies. As a result, there are calls for mid- to long-term measures such as supply-demand adjustment, improvement of distribution structures, and expansion of public sector demand to stabilize the domestic market.

There are also many voices calling for the swift passage of the "Special Act on Strengthening the Competitiveness of the Steel Industry and Transition to Green Steel Technology," which is currently being promoted. This bill centers on establishing a "Special Committee for Strengthening Steel Industry Competitiveness" chaired by the President and formulating the government's mid- to long-term support plan. Over 100 lawmakers from both ruling and opposition parties have participated in proposing the bill, emphasizing bipartisan support in the context of a 50% high tariff being applied to steel in Korea-US trade.

The industry also insists that the issue of steel tariffs must be revisited at the South Korea-US summit to be held in Washington, D.C. around mid-month. Since steel was effectively excluded from the negotiation table, the industry hopes that the matter will be directly addressed at the summit level. An industry official said, "Unlike other items, steel faces the greatest export difficulties due to the unprecedentedly high 50% tariff," adding, "As it is a symbol of global protectionism, we expect active negotiations between the two leaders."