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US President Donald Trump announced his much-anticipated decision on whether to impose trade sanctions under Section 232 before the deadline of April 11, bowing to pressure from US industrialists. The measure allows him to impose sanctions on imports thought to threaten national security.
The import tariff was not officially signed but Turkish steel exports to the US should continue if the tariffs are applied to the whole world, ÇIB chairman Namik Ekinci said.
Turkey is on the side of fair trade under World Trade Organization (WTO) rules, Ekinci said, and underlined the adverse effects of unfair protectionist actions on global steel trade.
“There should be no import tariff, of course. But if there must be an import tariff, then the right thing to do is to apply it equally to all countries. With the current decision, Turkish exports into the US, along with some other countries, will continue,” he added.
The internal US market will be the worst affected by the president’s decision, Ekinci said.
“All of the local steel prices have increased in the US following the US trade minister’s three import tariff suggestions [that were contained] within the Section 232 report. For example, rebar prices in the US domestic market went up to $850 per tonne, and are expected to exceed $900 per tonne soon,” he explained.
“As president, Trump should have been considering the effects on small industrialists and the general populace instead of only the steel industry. However, he took sides with domestic steel producers to the detriment of his people. This means transferring profits to US steel mills from the steel-consuming industries,” Ekinci said.
“Customers in the steel-consuming sectors – such as automotive, white goods, machinery and construction – will be hurt by rising prices. The US will not create any benefit for its steel industry but will cause much harm in the middle term,” he said.
“The US steel industry currently works unproductively due to outdated technology. Blocking incoming trade will allow local mills to be compete without making the necessary effort,” Ekinci added.
Market participants in Turkey agreed with the ÇIB chairman.
“I think Trump did not want to hurt either US local mills or exporters into the country. This decision will not change much,” a Turkish source said. “We will probably see prices climb in the short term.”