The United States has extended the suspension of Section 232 tariffs on steel of Ukrainian origin. The move will also benefit European steel exporters. The United States extended the temporary suspension of tariffs on Ukrainian steel for another year.
This decision is expected to increase demand for Ukrainian steel in Europe, because if European steel producers use Ukrainian semi-finished products or raw materials to produce finished steel products, these products will be able to enter the United States. without paying import taxes.
The U.S. initially suspended Section 232 tariffs on steel from Ukraine in May 2022 following Russia's invasion of Ukraine earlier in the year.
A notice posted on the White House website on May 31 stated: “Steel products from a member state of the European Union, where the steel used to make the steel product is smelted and cast in Ukraine, are not subject to and do not count . against the intra-quota amount of the tariff quota set out in paragraph 1 of Decree 10328 of December 27, 2021 (Adjustment of Steel Imports to the United States).
The wording of the statement reflects the change in trade relations initiated in 2021, when the US and the EU agreed to replace tariffs on steel and aluminum in accordance with section 232 in relation to 27 countries of the bloc with tariff quotas.
“As a result, European steel pipe producers will be increasingly interested in Ukrainian hot-rolled coil, and rebar exporters in Ukrainian [steel] blanks,” a source in the EU told Fastmarkets.
“Demand for long products in the EU has been at a low level since the end of 2022, and the outlook for 2023 is disappointing, so for EU plants [the opportunity to increase the supply of rebar and wire rod in the US might be a [welcome] option,” said a second trade source in Europe.
The US imported 850,876 tons of carbon and alloy steel tubes and pipes from the EU in 2022, led by Germany, according to the US Steel Import Control Administration of the International Trade Administration, more than double 404,056 tons exported to the US in 2021.
EU exports of carbon and alloy steel rebar to the US totaled 51,719 tons in 2022, compared to 100,321 tons in 2022. But total long product exports from the EU to the US were 695,391 tons in 2022, up from 569,806 tons in 2021.
