As the global trade environment becomes increasingly protectionist, U.S. tariff policies have taken center stage in shaping the fortunes of international steel players. In this blog, we explore the impact of these tariffs on the Indian steel industry and what the future might hold.
Key Information:
- Date: Effective from March 12, 2025
- Policy: The United States has imposed a flat 25% tariff on all steel imports
- Impact: It ends all country-specific exemptions, meaning India is no longer excluded from these tariffs
Indirect Impact: Rising Imports
India imposed a provisional 12% safeguard duty in April 2025 to protect domestic producers amid falling steel prices.
Japan & South Korea are redirecting steel exports to India, increasing import competition. These countries supply over 50% of India’s steel imports.
Why the direct impact is limited ?
- India exports only 95,000 tonnes of steel to the US annually.
- This volume represents:
- Less than 0.07% of India’s total steel production
- Only 6% of its total steel exports
- The direct impact of the new 25% US tariff on Indian steel exports is minimal because the US is not a significant export destination for Indian steel.
- The chart on the right (Steel | CR Coil: 1Y Trend) shows a temporary price dip around Jan 2025, possibly reflecting market sentiment or anticipation of the policy change. However, it recovers by May 2025.
