HONG KONG (Reuters) -China’s Iron and Steel Association said the 25% tariff increase on all steel and aluminum exports to the United States would have an adverse impact on the supply chain of the global steel industry, including China’s steel industry, state broadcaster China Central Television reported on Thursday.
U.S. President Donald Trump substantially raised tariffs on steel and aluminum imports on Monday to a flat 25% “without exceptions or exemptions” in a move he hopes will aid the struggling industry in the United States but which also risks sparking a multi-front trade war.
“In the short term, the impact on China’s steel exports is limited. However, in the long run, the United States may drive other countries to follow suit, thereby reducing the competitiveness of China’s steel exports,” the association said.
China exported 508,000 net tons of steel to the United States last year, or 1.8% of total American steel imports.
Zhang Longqiang, deputy secretary-general of the China Iron and Steel Association, said that it firmly opposed the tariff hike and said it was not conducive to “healthy and fair trade and market competition.”
“In the medium to long term, the increase in tariffs will have an adverse impact on the industrial chain and supply chain of the global steel industry, including China’s steel industry,” he said.
While China exports only tiny volumes of steel to the United States, it is responsible for much of the world’s excess steel capacity, according to Washington.
It says subsidised production in China forces other countries to export more and leads to trans-shipment of Chinese steel through other countries into the United States to avoid tariffs and other trade restrictions.
(Reporting by Farah Master and the Beijing newsroom; Editing by Muralikumar Anantharaman and Emelia Sithole-Matarise)
