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Steel Stock in Focus: Trump announced 25% tariff on steel, aluminum imports in latest trade growth
American tariff on steel
Shares of steel and aluminum companies, including Tata Steel, JSW Steel and Hindalco, declined by 4% on Monday, after the announcement of 25 percent of tariffs on all steel and aluminum imports by US President Donald Trump.
Other names like Steel Authority of India, Vedanta, NMDC, Nalco and Jindal Steel were also 3-4 percent below. The Nifty Metal Index was also more than 2 percent, making it the worst hit sectoral index.
NMDC, Hindustan Copper, Jindal Stainless, Wellspun Corporation, APL Apollo Tubes, Adani Enterprises, and Ratnamani metals were trading with a loss in range of 0.2 percent to 2.5 percent. Comparatively, the NSE Nifty Index was 130 points (0.55 percent) weak.
Trump also said that he would announce mutual tariffs on Tuesday or Wednesday, implement them in all countries and match the tariff rates of each country.
This step enhances concerns about a global trade war, with China’s retaliatory duties on American goods to be effective on Monday.
Last week, Trump first launched a trade war by putting tariffs on Mexico and Canada, then temporarily suspended them, but maintained duties on Chinese goods. This indicated a measured response from Beijing, indicating the possibility of interaction.
Who are the top steel suppliers in America?
So far, Canada – which Trump had earlier threatened with tariffs – according to America’s trade data, was the largest source of steel and aluminum imports in the US after Brazil, Mexico, South Korea and Vietnam. This latest policy threatens to ignite stress once again with American neighbors.
Earlier this month, both Canada and Mexico faced similar hazards when Trump threatened to impose 25 percent import duty on his products due to illegal immigration concerns. However, he later postponed the plan for 30 days until the beginning of March, after discussion with leaders of both countries.
During his first term, Trump imposed 25 percent tariff on steel imports and 10 percent tariff on aluminum imports from Canada, Mexico and European Union.
A year later, the United States signed an agreement with Canada and Mexico to raise those tariffs, although the European Union imported to 2021 until 2021.
Meanwhile, China’s Hot-Rold Coil (HRC) export prices remained a flat month-by-month (MOM) in December after a 6 percent decline in November. Steel prices in northern Europe, Japan and America fell by 1 percent, 2 percent and 5 percent of the mother, respectively.
In India, both primary long product prices and HRC prices fell by 3 percent mother in December.
By mid -January, HRC and primary long product prices were about 1 percent less than December average.
