Stuck in the middle
The Steel Survival Strategy meeting in New York in June was a trade battleground where countries fought over the grain of the manufacturing sector. Several years ago, it used to be a place of exchanging information and opinions on the direction of the steel market among CEOs of top steel companies such as ArcelorMittal, Nippon Steel and Posco. But this year, hardly any CEOs were in attendance.
Behind their absence is the undisguised trade protectionism of the United States. Notably, stars and stripes were all over the conference room in the Marriott Hotel in Times Square, Manhattan. The meeting has been held in New York every year, but this never happened. A Hyundai executive said that it didn’t look like a place to exchange information, and foreign attendees were coerced to take U.S. policies by the American steel industry.
Keynote speaker was John Ferriola of Nucor Corporation, a leading American steel company. He emphasized that China and other Asian countries pour steel at cheap prices into the international market while American steel workers lose their jobs. He mentioned President Trump’s executive order to the Department of Commerce in April to research foreign steel’s influence on the security of the United States and threatened that special measures will be taken on steel imports that threaten the industrial security of the United States. This could involve additional tariffs or the emergence of safeguards on imports.
The highlight was Li Xinchuang, the head of China Metallurgical Industry Planning and Research Institute. He seemed determined to criticize trade protectionism of the United States and prepared a long presentation. In the 19th century, the United Kingdom had a monopoly with 80 percent of worldwide steel production. In the 20th century until the 1970s, the United States took 40 percent of the market share of the steel industry. From 1996, China took the lead with a mere 20 percent market share, and Li questioned why the United States is turning to trade protectionism at this point. As trade protectionist regulations become tighter, customers will become more vulnerable and struggle due to higher prices, Li said.
Korea is the sixth-largest steel producer in the world, but on that day, Korea had little presence in the trade war between the powers. At the Korea-U.S. summit, steel was not mentioned. Trade protectionism is a reality, and we need to be vigilant.
JoongAng Ilbo, July 4, Page 30
*The author is the New York correspondent of the JoongAng Ilbo.