On the 20th, the Trade Commission of the Ministry of Trade, Industry and Energy requested the Minister of Strategy and Finance to impose a dumping prevention tariff of 27.91% to 38.02% on Chinese steel products, suggesting that the Korean steel industry is expected to recover its price competitiveness. The domestic steel industry has been struggling due to a decrease in thick plate demand amid sluggish construction activity and the influx of low-priced Chinese products. The imposition of the tariff will be finalized within 50 days of the Trade Commission's recommendation.
As of the 14th, the distribution price of imported thick plates was 780,000 won per ton, which is 13.3% lower than the distribution price of Korean products at 900,000 won. Most imported thick plates come from Japan and China, with the price of Chinese thick plates reported to be around 750,000 won per ton.
If Acting President and Minister of Strategy and Finance Choi Sang-mok confirms the anti-dumping tariffs as recommended by the Trade Commission, the price of imported thick plates will rise to the range of 1 million to 1.07 million won. A representative from the steel industry noted, "Given that the actual damage to the domestic steel market has been confirmed, this action is seen as necessary for protecting the domestic industry."
Thick plates, defined as hot-rolled steel plates with a thickness of 4.5 mm or more, are primarily used in the shipbuilding and construction industries. Additionally, they are used in various applications, including molds for industrial machinery, pipelines, offshore structures in marine plants, low-temperature pressure vessels used for gas tanks, and defense products for armored vehicles and tanks.
Meanwhile, China has been sending low-priced goods overseas, resulting in a steady increase in the amount of Chinese thick plates entering the domestic market. Among 2.1 million tons of imported thick plates that entered the country last year, 1.38 million tons, or about 65.7%, were from China. The import quantity of Chinese thick plates was 810,000 tons in 2022. The influx of low-priced Chinese thick plates has led to a decrease in sales and an increase in inventory of domestic thick plates. According to the Korea Iron and Steel Association (KISCO), domestic sales of thick plates fell from 6.44 million tons in 2022 to 5.86 million tons last year, while production fell by 2% to 8.67 million tons, but inventory increased by 11% to 470,000 tons.
The steel industry is demanding additional measures. The shipbuilding industry, which has high demand for thick plates, is less likely to be affected by tariffs due to the prevalence of bonded zone workspaces. Lee Jae-yoon, head of the Carbon Neutral Industrial Transition Research Division at the Korea Institute for Industrial Economics and Trade, said, "The fact that the tariff imposed is higher than the industry expectation (above 20%) likely indicates that the difference in market share between imported and domestic thick plates has widened excessively. To revitalize domestic thick plates, measures to strengthen cooperation between the domestic shipbuilding and steel industries should be pursued."
A representative from the steel industry also noted, "The anti-dumping tariff should be viewed as a means of normalizing the market. There may continue to be an influx of thick plate products into Korea, so the imposition of provisional tariffs may also be necessary."