An interesting news story recently reported on President Donald Trump’s investigation into steel dumping in the US. Potential effects of this investigation have largely been attributed to reduced trade with China. However, it could also have an adverse effect on the UK steel industry. In this article we will investigate the news story, and its possible effects.
The Story So Far
On the 21st of April, president Donald Trump launched an investigation into steel imports from outside the US. The move is designed to stop countries from outside the US flooding the market with cheap steel produce, which causes major disadvantages for local US suppliers. The move seems largely to be about Chinese imports, but the president has denied this. This investigation could lead to new tariffs being made on imports, effecting the viability of exporting to the US.
Protecting US manufacturing and becoming independent from Chinese goods supply has long been a campaign promise of president Trump. Cheap foreign steel is causing local steel production in the US to become uncompetitive, leading to job losses. Referencing the investigation, president Trump stated “Steel is critical to both our economy and our military. “This is not an area where we can afford to become dependent on foreign countries.”
Possible Ramifications for the UK Steel Industry
Although popular opinion suggests this investigation is aimed at China, it could have major impacts on the UK steel industry. The UK exports most manufactured goods to the US, and with the potential effects of Brexit, the UK’s reliance on trade with the US will become more and more important. Tariffs imposed upon steel exports would significantly affect the UK steel industry.
The investigation is still in its infancy, and the full extent of its effect on the UK is unclear, but it could severely disrupt steel exports to the US. A group representing steel firms of the UK has expressed concern over this. The director, Gareth Stace stated “The UK sector is entirely supportive of measures taken to tackle dumping of steel products and unscrupulous trading practices but this move has the potential to go much further than necessary.”