South Korea's Trade Commission is evaluating whether to impose provisional anti-dumping duties on certain Chinese plate products, following an investigation prompted by Hyundai Steel’s formal complaint. This investigation, which began on October 4, 2024, focuses on plate products imported from China under specific HS codes. Hyundai Steel, a major steel producer in South Korea, has claimed that Chinese plate products are being sold at unfairly low prices, alleging a dumping margin of 25.89%. If the investigation results in a favorable decision for Hyundai Steel, the provisional AD duties could come into effect as soon as February 2025.
The targeted products include various types of steel plate, such as hot-rolled plates and other flat-rolled products, which are commonly used in the automotive, construction, and manufacturing sectors. These products fall under several Korea-specific HS codes, including 7208.51.1000, 7208.51.9000, and 7225.40.9099, among others. The move to investigate these particular items comes amid growing concerns that the influx of cheap Chinese steel is undercutting local manufacturers and disrupting the domestic market.
In the first ten months of 2024, China exported nearly 1 million metric tons of these plate products to South Korea. While this volume represents a slight year-on-year decrease of 3.8%, China’s market share has continued to grow, accounting for 62.7% of South Korea’s total imports of these plate products. This increase in supply share has raised alarms within the South Korean steel industry, particularly as Chinese exports have historically been priced lower than domestically produced steel, potentially undermining fair competition.
Hyundai Steel’s complaint highlights the disparity in pricing between local South Korean steel products and Chinese imports, claiming that Chinese producers are selling steel at artificially low prices due to government subsidies, which would constitute unfair trade practices. The claim of a 25.89% dumping margin, if proven true, would indicate significant market distortions, putting local manufacturers at a competitive disadvantage. The potential imposition of AD duties is seen as a protective measure to level the playing field for South Korean steelmakers.
The potential duties would be an important development in the ongoing trade relations between China and South Korea, particularly in the steel sector. Both countries are major players in the global steel market, and their trade dynamics have often been marked by tensions over pricing practices and market access. South Korea’s steel industry has faced increasing competition from China in recent years, particularly as China ramps up its steel production and exports, often bolstered by state support.
If the Korea Trade Commission decides to implement the provisional duties, it could have far-reaching effects on trade between the two nations. South Korea’s steel industry could see relief from the influx of cheap Chinese imports, but it could also face retaliatory measures from China, which has historically been sensitive to anti-dumping tariffs. Additionally, the move could raise concerns among South Korea's other trading partners about the potential for protectionist measures, complicating global trade relations in the steel industry.
The AD investigation and the potential imposition of duties reflect broader global concerns about the impact of subsidized steel production and trade imbalances. As steel imports into South Korea continue to rise, the government and industry players are closely monitoring the situation to protect domestic producers while navigating the complex web of international trade laws and regulations. The outcome of this investigation could set a significant precedent for how South Korea deals with dumping issues in the future, especially as the country looks to maintain its competitive edge in the global steel market.
