Metal Miner’s analyst has examined the impact of President-elect Trump’s China trade policy on grain-oriented electrical steel markets and prices, concluding that whichever policy the President-elect chooses, it should not significantly influence the U.S. GOES market.
Considering that Donald Trump is evidentlypro-steel and has officially spoken against China’s trade practices, U.S. analysists wonder how much will his China trade policy influence the prices in the U.S. GOES market.
According to Metal Miner, average grain-oriented electrical steel surcharges in the U.S. fell for the third year in a row.
Regarding the U.S.-China trade scenarios, Metal Miner analyst says we could see a scenario in which tough trade policies such as a tariffs could significantly limit Chinese imports, which currently make up about 10% of domestic steel demand according to a recent analysis by Stratfor.
Also, China could account for far less steel imports into the U.S. than it currently does (China has cut excess capacity already). But in terms of GOES, China does not represent the bulk of GOES imports into the U.S. – Japan, Russia and the U.K. are far bigger GOES exporters to the U.S.
So, regardless of which trade policy President Trump selects, it will likely have a bigger impact on the broader steel markets and a far less significant impact on the U.S. GOES market.
Source: Metal Miner