Global steel market's fracturing order calls for new playbook: report

The global steel market, once characterized by open trade, is rapidly fragmenting into fortified regional enclaves, according to a report by the Korea Investors Service (KIS). Korean steelmakers are facing a challenging two-front battle due to the collapse of this global framework. On one front, they are struggling to maintain access to primary export markets as international tariffs continue to rise. On the other front, they are contending with a surge of low-cost Chinese imports threatening their domestic market.

The catalyst for this global reshuffling can be traced back to Washington, where the United States has systematically dismantled country-specific exemptions and quotas. Simultaneously, the U.S. has imposed a 50 percent tariff on steel imports. This move has triggered a protective domino effect across major demand hubs worldwide.

In response, the European Union has reduced its duty-free import quotas and matched the U.S. 50 percent out-of-quota tariff rate. Similarly, neighboring markets such as Canada, Mexico, India, and several Southeast Asian nations have introduced tighter controls on steel imports. This fragmentation of the global steel market presents significant challenges for Korean industrial giants.

They must navigate this new landscape, balancing their efforts to protect their domestic market while seeking alternative avenues to access primary export markets.