Losses Beat Tariffs For Chinese Steel Wire Makers’ Exports — Panjiva
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Losses Beat Tariffs For Chinese Steel Wire Makers’ Exports

China 1758 Materials - Metals/Mining 482 Metals - Steel 360 Tariffs 1169 U.S. 3297

Steel producers in China may have made a monthly loss in profit terms for the first time in three years in October according to Reuters. That resulted from a mixture of surging production – which reached a record in October – leading to a collapse in prices. That’s likely led to a more recent increase in shipments of steel to other markets.

Notably export to the U.S. may have increased significantly. Steel imports by sea to the U.S. from around the world, with a handful of exemptions as outlined in Panjiva research of Nov. 5, are now subject to 25% duties. That likely drove an 11.8% reduction in seaborne imports in October vs. a year earlier, Panjiva data shows. Yet, October’s volumes had increased by 13.3% sequentially.

AMERICAN METALS IMPORTS TRIMMED, COULD BE MAKING A COMEBACK

Chart shows U.S. seaborne imports of steel products covered by section 232 duties.   Source: Panjiva

That increase was driven in large part by shipments from China which surged 25.3% higher sequentially. That may reflect Chinese suppliers’ need to find alternative markets and also meant shipments actually increased by 5.8% year over year.

STEEL SUPPLIES FROM CHINA AND JAPAN JUMP IN OCTOBER

Chart segments U.S. seaborne imports of steel products covered by section 232 duties by country.   Source: Panjiva

The fastest growing imports from China at a product level in October were steel wires including uncoated wire (HS 7217.10) which climbed 21.0% sequentially and coated steel wires (HS 7217.20) which climbed 53.6%. Other major products that saw accelerating shipments included welded non-alloy steel pipes (HS 7306.30) which increased by 33.3%.

WIRES AND PIPES CONNECT INCREASED CHINESE EXPORTS TO THE U.S.

Chart segments U.S. seaborne imports of steel products from China covered by section 232 duties by product.   Source: Panjiva

The increase in shipments of steel wire provide buyers with the opportunity to pick up lower cost resources, possibly to stockpile ahead of gaining exemptions from section 232 duties as well as use in day-to-day operations. Leading U.S. buyers of Chinese steel wire products (HS 7217 broadly) in the past 12 months by weight include Leggett & Platt and Masco’s Arrow Fastener.

LEGGETT RUNS MORE CHINESE STEEL AS ARROW’S IMPORTS SHOOT HIGHER

Chart segments U.S. seaborne imports of steel wire products from China by consignee.   Source: Panjiva

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