China's Steel Exports Surge, Impacting ASEAN Markets
Via Metal Miner
There's no doubt that China is desperately seeking new markets to hawk its goods and commodities after the U.S. trade tariffs kicked in. This is especially true when it comes to the country's steel industry. In fact, even prior to the trade war, Beijing was actively looking at expanding its access to steel markets.
So, as anticipated, there are now reports of Chinese steel being dumped in Indian and ASEAN countries. While India quickly responded with a 12% safeguard duty, ASEAN countries like Malaysia and Vietnam now find themselves recipients of millions of tons of cheap Chinese exports.
The boost in exports to ASEAN was clearly evident in the Q1 20245 export-import figures for steel, which showed a 32% year-on-year increase totaling 36.55 million tons. According to reports, the figure represented about 70% of China's total exports during that period, while only about 30% was earmarked for countries in other regions.
Malaysia, for example, saw an uptick of 71.3%, while Vietnam experienced a hike of 68.5%. The high export figures have since sent the ASEAN Steel Committee into a tizzy as they sought to protect local steel markets. As per figures by the General Administration of Customs, China's rebar export touched 839,687 tons in Q1, up by 112% year-on-year. Meanwhile, wire rod exports added another 1.43 MT, up by 55% year on year. Finally, billet exports totaled 1.44 MT, a 10-fold year-on-year increase.
However, the real caveat is that all of this happened when these steel products had yet to be impacted by the tariff war, though the clouds had certainly started to show on the horizon.
ASEAN nation policymakers now have a tough call to make. For a long time, this group enjoyed the fruits of China's growth, including the country's re-laying and re-aligning of the global supply chain. Even in earlier times, when the U.S.-China trade relations ran into a dispute, this part of the world remained isolated from the fallout, sometimes even benefiting from the adverse conditions.
According to one think tank's analysis, the fact that China's industrial capacity continues to outpace itself has put the ASEAN nations bang in the middle of an economic crisis. Reports indicate that exports to ASEAN by Beijing started moving upwards from 2023, sometimes even exceeding the export numbers of the U.S. and the European Union. In 2024, ASEAN total export figures from China increased by 12%, and from all available indications, they are set to rise even more in 2025.
On the other hand, exports from ASEAN nations to China have declined by 3% since 2022, leading to a significant regional trade deficit. The aforementioned report indicates that part of the export growth was intermediate goods, thus propping up the export story of many an ASEAN nation.
But today, final goods make up much of the exports, thus affecting employment and local economies. The current fear is that China's 'oversupply' could affect the ASEAN region's larger economic and industrial health, and could also have a cascading effect down the supply chain for the rest of the world.
Where India is concerned, the demand to impose an anti-dumping duty on steel coming in from China has been there for some time now. In the wake of the U.S.-China tariff war, the government of India put a 12% safeguard duty on non-alloy and alloy steel flat products in April.
According to the Ministry of Finance, the decision came after a probe by the Directorate General of Trade Remedies, which falls under the Ministry of Commerce and Industry. The report by the latter revealed that there had been a startling rise in imports, retaining the potential to hit India's local steel industry particularly hard. The new tariff will be in effect for 200 days.
By Sohrab Darabshaw
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