EAEU steel tariffs less broad than first feared

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EAEU steel tariffs less broad than first feared

The Eurasian Economic Union (EAEU) said it will exclude steel used in automobile production from safeguard measures, according to Korea’s Ministry of Trade, Industry and Energy.

The decision puts to rest concerns about the supply of Korean steel to a Hyundai Motor manufacturing plant in Russia.

The Trade Ministry said Wednesday that according to the EAEU’s final investigation on steel safeguard measures, the five-member economic union will only place hot-rolled steel under the measures and exclude cold-rolled and coated steel.

The EAEU - Russia, Kazakhstan, Kyrgyzstan, Belarus and Armenia - had conducted a safeguard investigation in response to worries that surplus steel could flood into the union after similar safeguard measures were imposed by the United States, European Union and Turkey last year.

The safeguard investigation from EAEU had led to worries that the supply of Korean coated steel plates used at Hyundai’s Russia plant could be limited.

According to the Trade Ministry, Korea exported $198 million worth of steel products of the sort under investigation to the EAEU last year. Coated steel took up the largest share, at 52 percent, with hot-rolled steel at 45.7 percent and cold-rolled steel at 2.3 percent.

The Trade Ministry played down the impact of the safeguard measures against hot-rolled steel, as the average imported amount by the EAEU from 2015 to 2017 will be exempt from tariffs and because the measure will be only in place for one year.

Imported hot-rolled steel imports that exceed 996,596 tons will be tariffed at a 25 percent rate.

The government said it had argued against the safeguard measures since October last year.

The EAEU is expected to report the final investigation result to the World Trade Organization soon and finalize the measures by August, according to the Trade Ministry.

BY CHAE YUN-HWAN [chae.yunhwan@joongang.co.kr]
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