U.S. takes first steps against Korean steelmakers

U.S. President Donald J. Trump is taking his first significant protectionist action against foreign steelmakers since taking office.

According to industry sources and the Korea Trade-Investment Promotion Agency on Friday, the United States started an anti-dumping probe into carbon and alloy steel wire rods, and launched a national probe into whether steel imports threaten its security.

The anti-dumping probe into wire rods began on Tuesday, an expansion of past probes that used to be centered on hot-rolled and cold-rolled sheets, steel plates and steel pipes.

“Wire rod” refers to thick wire that can be processed into nails, screws and tire cords.

Korea exported $45.6 million worth of carbon and alloy steel wire rod to the United States last year, ranking fifth in terms of exports, according data from the World Trade Atlas. Exports from Korea account for about 9 percent of all imported wire rods based on 2015 data.

While the probe into wire rods is targeting 10 countries, Korea is the second largest exporter among them, after Ukraine.

Four major American steelmakers, including Gerdau Ameristeel US, filed petitions to the U.S. Department of Commerce last month, arguing that Korean companies saw at least 33.96 percent in dumping margins by pricing their products below fair market price.

As the nation’s largest steelmaker, Posco, is essentially the only supplier of wire rods to the United States, and it is focusing more closely on the case.

“Our wire rod products exported to the U.S. are mostly high-end products rarely produced by American companies,” said Kim Min-hee, a spokesperson for Posco. “We will explain our position thoroughly, so we can be exempted from anti-dumping tariffs.”

Posco exported 90,000 tons of wire rods to the United States last year. While it will take nearly a year until the final judgement on whether to impose anti-dumping tariffs, Posco is expected to respond before then.

Other local steelmakers, however, are not free from U.S.-powered risks.

According to the Financial Times on Friday, the United States decided to use a 1962 law that allows the government to “limit imports that threaten security readiness” of the country. Following this, a national probe on foreign imports to see whether they threaten U.S. economic or national security is now underway.

BY KIM JEE-HEE [kim.jeehee@joongang.co.kr]