South Korean media: The US will increase the steel import tariff to 50%, and the Korean industry is "hard to bear" The road for South Korean steel industry, which has already fallen into a slump, to export to the US continues to narrow. As US President Trump significantly raised the steel import tariff from 25% to 50%, while major steel exporting countries such as Canada and the EU have expressed protests, pessimistic opinions of "hard to bear" have been heard in South Korea's industry. On the 30th of last month, President Trump announced the plan to raise steel tariffs at an American steel plant in Pennsylvania. Regarding this tax increase measure, he stated, "It will make the American steel industry stronger." Previously, President Trump had imposed a 25% tariff on foreign steel products in March under Section 232 of the Trade Expansion Act. After about two months, he announced that the rate would be doubled. After the speech, President Trump posted on his social media Truth Social, stating, "The tariff increase will begin on Wednesday, June 4." This tariff increase was interpreted as a move to force global steel enterprises to invest more in the US steel industry. On the same day, President Trump announced that Nippon Steel, which is acquiring US Steel Corporation, has decided to invest $14 billion (approximately 19.4 trillion Korean won) in the US, calling it "the largest single investment in history, and the largest single-day investment in US steel history," and "this will create over 100,000 jobs in the US." Analysts pointed out that the previous 25% tariff implemented by the US was not enough to stop foreign steel imports, so the rate was further increased. Since Chinese low-priced steel cannot enter the US market, local steel prices have remained relatively high, and overseas companies have been willing to bear the tariff to maintain exports to the US. According to data from the Korea International Trade Association, South Korean steel exports to the US reached 252,000 tons in April after the US imposed the tariff, an increase of 11.7% year-on-year. Lee Jae-in, director of the Carbon Neutrality Industrial Transformation Research Office at the Korea Institute for Industrial Economics and Trade, said, "Due to the US steel market being 20 to 30% higher than the global market, most previous predictions suggested the impact on exports would be limited." "If the tariff is raised to 50%, the losses caused by the decline in exports will significantly impact the domestic industrial chain." The South Korean steel industry is currently facing an urgent situation. According to last year's data, the US market accounted for approximately 13.1% (4.347 billion USD) of South Korea's total steel exports (33.282 billion USD), making it the largest export destination. In last month's economic outlook report released by the Bank of Korea, it was analyzed that if a 25% tariff is imposed, South Korean steel exports to the US this year will decrease by 1.4%. With the tariff further increasing, the decline in exports is expected to be even more significant. The two leading South Korean steel companies, POSCO and Hyundai Steel, are planning to counter the tariff by setting up a joint venture factory in the US. Following Hyundai Steel's announcement in March to invest $5.8 billion (approximately 8 trillion Korean won) to build a steel mill in Louisiana, POSCO decided to participate and jointly invest. However, this steel mill is expected to only begin commercial production in 2029, during which time the tariff impact will be difficult to avoid. Industry insiders said, "What we are most concerned about right now is whether we can continue to export products to the US market while bearing a 50% tariff," "We are closely monitoring the impact of the tariff and considering various response measures, including accelerating the start-up time of the US steel mill and exploring alternative markets." Experts suggest reducing the impact of specific product tariffs through bilateral negotiations. Previously, in the US-UK trade negotiations, an agreement was reached to impose only a 10% tariff on UK imports of up to 100,000 vehicles annually, rather than the originally planned 25%. Jang Sang-jik, director of the International Trade Research Institute at the Korea International Trade Association, pointed out, "South Korea should focus on negotiating with the US around industries such as shipbuilding and energy, where there is cooperation potential, to争取 obtain preferential low-tariff quotas." Source: JoongAng Ilbo Original article: https://www.toutiao.com/article/1833794355418247/ Disclaimer: This article represents the author's personal views.