This Morning in Metals: U.S., China Fire Tariff Salvos

Trade Tensions Rise

At midnight, $34 billion of the U.S.’s previously announced $60 billion tariff package on Chinese goods went into effect. As previously indicated, China responded in kind, placing $34 billion in tariffs on American goods.
According to the Xinhua news agency, China’s 25% tariff will include agricultural products, vehicles and aquatic products. A China Ministry of Commerce spokesperson said the U.S. has acted like a “trade bully” that poses a “great threat to the security of global industry and value chains.”
Echoing previous comments from Chinese government officials, Premier Li Keqiang said that no one will win a trade war, but that China is “prepared to take countermeasures in the face of unilateral moves.”

Steel Imports Hit 22% Market Share in June

According to the American Iron and Steel Institute’s (AISI) report on steel imports in June, import permit applications were down 3.7% compared with the previous month. Steel import permit applications for June totaled 2,894,000 net tons (NT).
The countries with the largest finished steel import permit applications in June were: South Korea (206,000 NT, up 88% from May preliminary), Japan (134,000 NT, up 11%), Germany (105,000 NT, down 25%), Taiwan (103,000 NT, up 32%) and Vietnam (88,000 NT, up 18%).

Thyssenkrupp CEO Offers Resignation

It’s been a busy week for the German steelmaker.
Heinrich Hiesinger, CEO of thyssenkrupp AG since 2011, has offered up resignation just days after the German company finalized a merger deal with Indian firm Tata Steel, Reuters reported (the deal would merge the firms’ European operations to create Europe’s second-largest steelmaker, behind ArcelorMittal).
“Today I informed the Supervisory Board that I would like to step down from my position as CEO of thyssenkrupp,” Heisinger said in a prepared statement. “I take this step very consciously to enable a fundamental discussion in the Supervisory Board on the future of thyssenkrupp. A joint understanding of Board and Supervisory Board on the strategic direction of a company is a key pre-requisite for successfully leading a company. The broad support of our shareholders and the Supervisory Board was the basis for the success of our Strategic Way Forward since 2011.
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“This path always balanced the interests of our customers, employees and shareholders. Today thyssenkrupp is a completely different company regarding culture, values and performance. The joint venture of our steel activities with Tata is the next significant step to turn thyssenkrupp into a strong industrial company. We can be proud of what we achieved until now. For this I would like to thank all employees. They are the most valuable capital of thyssenkrupp.”