This morning in metals news, Canada could respond to the U.S. steel tariff with a broad global tariff of its own, the governor of Texas says the metals tariffs could harm the oil and gas sectors, and India could be the recipient of a flood of redirected Chinese steel.
Canada Weighs Broad Tariff Option
The Canadian government is considering slapping tariffs or quotas on some steel imports from all of its trading partners, the Wall Street Journal reported.
The measures would seek to protect the Canadian industry from materials flooding the market as a result of the U.S.’s 25% steel tariff and subsequent redirected supplies.
Texas Gov. Warns of Tariffs’ Impact on Oil, Gas
Texas Gov. Greg Abbott, in a letter to President Trump, argued the steel and aluminum tariff enacted by the current administration will negatively impact the oil and gas sectors, the Texas Tribune reported.
“Our country’s steel and aluminum workers are a vital part of the national workforce, and creating jobs in that industry must be a top priority,” he said in the letter, according to the report. “But attempting to protect these jobs through the new tariffs could jeopardize the livelihoods of hundreds of thousands of Texans and other Americans employed in the oil and gas industry.”
The U.S. tariff on steel only discourages imports — of course, it doesn’t make those physical totally disappear into the ether.
With that in mind, one asks: where will steel products previously destined for America now go in this post-Section-232 world? Particularly, where will Chinese inventory go?
According to Bloomberg, India could be the destination for much of that supply. According to the report, as much as 80 million tons of steel (17% of global supply) could be diverted to other markets, including the fast-growing India.