UAE steel producers don't expect major impact from Trump's doubling of import tariffs
UAE-based steel producers do not expect to see any major impact from the latest move by the US to double tariffs on steel imports.
US President Donald Trump has raised import duties on steel and aluminum imports to 50 per cent, from 25 per cent previously, starting on Wednesday, the White House said.
The new tariffs apply to all trading partners except the UK, which struck a preliminary trade agreement with the US last month.
However, steel manufacturers in the UAE don't anticipate a hard hit.
The US decision to double steel import tariffs "may have an indirect effect on market dynamics but is not expected to materially impact Emsteel's business", Michael Rion, chief commercial officer at Emirates Steel, part of Abu Dhabi listed Emsteel Group told The National.
The company has a "modest exposure" to the US market, with exports accounting for less than 2 per cent of total annual sales, he said.
"Given this proportion, the financial and operational impact of the new tariff regime is considered minimal.
"Our current US business model is opportunistic and margin-driven, not volume-dependent."
The company currently exports steel products to 70 markets around the globe.
Meanwhile, UAE-based steel products manufacturer Conares said it is diversifying its export markets across Asia, Africa and Europe.
"With the US potentially becoming less accessible, we foresee increased demand and strategic opportunities within the GCC and Mena regions," said Bharat Bhatia, founder and chief executive of Conares.
The company is also "actively strengthening its domestic footprint to meet infrastructure and construction growth locally", he said.
Conares has large steel plants in Jebel Ali Free Zone with an annual production capacity of 100,000 tonnes of steel products including rebars, pipes, and color-coated steel coils, strips and plates.
The latest move comes as the Trump administration continues with its trade protectionist policy.
'Foreign nations have been flooding the US market with cheap steel and aluminium subsidised by their governments," the White House said on Tuesday.
'President Trump is taking action to end unfair trade practices and the global dumping of steel and aluminium."
The White House said Mr Trump's tariffs in his first terms as President 'strengthened the US economy,' and 'led to significant reshoring' in industries like manufacturing and steel production.
'While the domestic steel industry briefly achieved 80 per cent capacity utilisation in 2021, subsequent trade pressure has depressed domestic production," it said.
In 2022 and 2023, capacity utilisation fell to 77.3 per cent and 75.3 per cent, respectively, with high import volumes being a "major factor in depressing domestic production volumes".
While Mr Trump announced sweeping tariffs across industries and nations two months back, Washington is currently holding talks to reach an agreement on lowering levies.
On May 12, the White House announced that China and the US struck a deal to suspend their tariffs for 90 days. Washington and Beijing lowered their levies to 30 per cent and 10 per cent, respectively from an initial announcement of 145 per cent and 125 per cent in April.
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