After weeks of negotiations, the United States and the European Union have agreed that the EU will not impose further tariff increases on US products. In exchange, the EU gets talks on excess capacities in steel and aluminum.
EU and US: Let’s talk about excess capacities in steel and aluminum
After it already looked as if the mutual tariffs on steel and stainless steel between the United States and the European Union could be dropped, it unfortunately turned out to be nothing more than a lot of warm air.
Only a doubling of certain tariffs has been suspended, which should make manufacturers of spirits and motorcycles in the USA breathe a sigh of relief.
Steel tariffs not yet affected
This means that there will still only be talk of excess capacities for steel and aluminum. There will be no change in steel tariffs for the time being. Here, relevant lobbyist groups are already positioning themselves, welcoming the commitment of the two governments and at the same time presenting initial figures.
Thorsten Gerber, CEO of Gerber Group said today only: “A rascal who thinks evil of it.“
Or as barrons.com so beautifully writes: “The biggest risk to steel stocks isn’t tariffs. It’s high prices. Steel prices are at multiyear highs, and any factors that drive them down, including increasing supply, have the potential to hurt the returns of steel stocks.”
Markets in wait-and-see mode
Many steel mills are currently looking for clarity on the markets before making new decisions. E.g. in Turkey with regard to the rapidly developing scrap prices, this is the case.
In other respects, too, the markets seem to be in a wait-and-see mode, waiting for a new trend. In any case, the German DAX is already shooting ahead and climbing to new record highs.
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- Stainless Espresso: Will EU-US steel tariffs fall on Monday?
- Stainless Espresso: Is the EC moving away from the EU steel lobby?
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