April 24, 2018 / 5:15 AM / 3 months ago

Japan steel industry head says new U.S. tariffs have not hit Asia market yet

TOKYO (Reuters) - The head of Japan’s steel industry federation said on Tuesday that new import tariffs on steel imposed by the United States have not yet hit the Asian steel market, but said the industry is monitoring the situation closely for any future impact.

Kosei Shindo, president of Nippon Steel & Sumitomo Metal Corp, makes a speech at a ceremony to welcome newly-hired employees in Tokyo, Japan April 3, 2017. REUTERS/Kim Kyung-Hoon/Files

“The steel market in China has been recovering from a temporary downturn after the U.S. sanctions while steel prices in ASEAN countries have been holding up,” Japan Iron and Steel Federation Chairman Kosei Shindo said at a news conference.

“We have not seen a situation where the supplies that were shut out by the U.S. market flow into Asia and weigh on local markets, but we’ll closely watch further development,” he said.

China’s steel rebar futures rose on Tuesday to their highest in a month-and-a-half.

Last month, the U.S. set duties of 25 percent on steel and 10 percent on aluminium, but provided a temporary exemption until May 1 for the European Union and six other nations. The exclusion included most U.S. allies, but not Japan.

U.S. President Donald Trump and Japanese Prime Minister Shinzo Abe held talks last week and said they had agreed to intensify trade consultations between the two longtime allies, with an aim to expand investment and trade between their countries.

Trump said the tariffs had brought many countries to the negotiating table and that he may take the duties off of Japanese steel and aluminium imports if the two countries can come to a trade agreement.

Shindo said Japanese steelmakers, meanwhile, are trying to seek item exemptions from the U.S. tariffs.

He said only about 165 applications to seek item exemption out of nearly 4,000 applications have been approved so far.

Reporting by Yuka Obayashi; Editing by Kenneth Maxwell and Christian Schmollinger

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