February 4, 2025
As we enter the second month of 2025, let's dive into some key market updates.
What are the 3 Key Policy Concerns of the AISI?
Following the transition of administrations, The American Iron and Steel Institute (AISI) presented its 2025 policy priorities for the steel industry to key members of Congress and senior officials in the new administration.
AISI President and CEO Kevin Dempsey stated that 2025 offers a chance for the new administration and Congress to comprehensively address critical issues affecting steel manufacturing. He emphasized the importance of considering three key policy areas: trade, tax, and regulation, as policymakers work to bolster the economy and ensure national security.
AISI's recommendations include strengthening existing trade measures to combat inequitable foreign trade practices, implementing sensible regulations that promote innovation, and enacting tax policies that incentivize new and sustained investment.
Dempsey highlighted the crucial role of steel in various aspects of American life, from transportation infrastructure and household appliances to the energy sector. He asserted that these policy recommendations will support the continued success of the American steel industry and the jobs it sustains.
The policy priorities include expanding Section 232 steel tariffs to cover downstream products, maintaining or lowering the current 21% corporate tax rate, and broadening Section 301 tariffs to encompass all steel originally melted and poured in China, regardless of final processing location.
The complete list of AISI's policy priorities for the American steel industry is available here.
How do production stats compare to last year?
As of February 1, 2025, the adjusted year-to-date production of US domestic raw steel was 7.534 million net tons, up nearly 1% from 7.461 million net tons as of February 1, 2024, according the AISI. Capacity utilization rate was listed at 74%, compared to 73.3% during this period in 2024.
What’s the latest on tariffs?
The section 232 tariffs on steel imports, originally implemented in 2018, were reintroduced by the current administration. They call for a 25% duty on steel imports from most countries.
As of February 4, 2025, these tariffs on steel imports, along with the 25% tariffs on nearly all goods imported from Canada and Mexico, will be delayed for a minimum of 30 days, according to the president. The US still plans to impose at 10% tariff on Chinese imports.
What impact can tariff reintroduction have on the steel industry?
- Domestic products become more competitive
- Decreased volume of imported steel
- Shift in global steel trade flows
- Possible imposition of counter-tariffs on US steel
- Possible sector-specific changes in demand, namely automotive, construction, and energy
While domestic steel producers may benefit from increased prices, the long-term economic impact remains uncertain. As 2025 develops, industry stakeholders, policymakers, and economists will be exceedingly attentive to how these changes are affecting steel prices and market dynamics.
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Sources & Additional Information:
https://www.aist.org/aisi-outlines-key-steel-industry-priorities
