The United States is thinking out loud about a possible carbon border tax. At the same time, however, they are making it clear that they do not want to harm the domestic economy. In addition, the Vietnamese government has called on domestic steel producers to reduce exports following a sharp rise in steel prices. And in Brazil, sales by steel distributors rose by over 100% in April.
United States considers carbon border tax, but sees risks
United States climate envoy John Kerry said Tuesday that Washington was exploring the possibility of imposing a fee on imports from countries that do not tax heavy polluters, but he warned that such a move could pose risks “downstream.”
Kerry said President Joe Biden had instructed U.S. officials to examine “what are the consequences, how do you do the pricing, what is the impact.”
U.S. govt wants to know impact of carbon border tax before introduction
In addition, Kerry made it clear that before implementing a tool similar to CBAM, the United States would want to know exactly what the impact might be on the “downstream.” This is so that any potential measures do not turn into damage to the domestic economy.
Thus, the United States seems to demonstrate greater foresight than the Europeans with their Carbon Border Adjustment Mechanism (CBAM).
Vietnam urges steelmakers to cut exports as domestic prices rise
The Vietnamese government has urged domestic steelmakers to increase production and limit exports to combat rising steel prices.
“We should prioritize supplies to the domestic market to ensure price stability,” Deputy Prime Minister Le Minh Khai said in a statement released earlier this month. Such an industry intervention by a top Communist Party official is considered highly unusual.
Steel prices in Vietnam up 50%
Import prices for hot-rolled coil steel, a staple for construction materials, have surpassed $1,000 per ton, reaching a high not seen in 13 years. Prices have risen 50% since the beginning of the year.
The main culprit behind the rising prices is China, which dominates most of the world’s steel production. Supplies from the Asian power have recently been declining.
Brazil’s flat steel distributor sales up 106.7% in April
Sales of flat steel by Brazilian distributors rose 106.69% in April compared with the corresponding period of 2020, amid a lower comparative base and stronger end-user demand, national distributors’ association Inda said Tuesday, May 18.
Distributors sold 343,100 tons in April, up from 166,000 tons a year earlier when there was a demand crisis due to the Covid 19 pandemic.Sales volumes also rose 5.44% month-on-month from 325,400 tons in March, Inda added.
Will steel prices rise again in Brazil?
In addition, there seem to be indications that Brazilian steelmakers may raise prices again, having already increased steel prices by 18% for May 2021.
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