The American Iron and Steel Institute (AISI) on May 7 urged the Office of the US Trade Representative (USTR) to consider cumulative tariffs against the "worst actors" among 16 economies under Section 301 investigation for structural excess capacity, citing record Chinese steel exports and surging shipments from India, Indonesia, Korea, Japan and Mexico.
Testifying on the third day of USTR's hearing in Washington, AISI senior vice president, policy and general counsel, Jeremy Hekhuis said China alone accounts for over half of global excess steel capacity, with annual exports reaching a record 131 million mt in 2025, which is more steel than North America consumed last year. Hekhuis described the impact as a cycle in which Chinese exports redirect trade flows globally. Chinese imports met 60 percent of Southeast Asia's steel demand last year, while the region's own finished steel exports rose 54 percent in the same period.
Regarding India, Hekhuis stated that the country was "taking a page out of China's well-worn playbook" through heavy state subsidies and reported robust 2025 export growth, despite India's stated focus on domestic demand. Indonesia was singled out for export restrictions on nickel and other steel inputs, which he said disadvantage US producers twice, first by limiting raw material access and secondly forcing them to compete with subsidized Indonesian output.
Looking at South Korea, Mr. Hekhuis said weak domestic demand and rising Chinese imports have pushed South Korean producers to export as much as 40 percent of their output in recent years. Japan produced 84 million mt of steel in 2024 and exported 34.4 million mt of that, including roughly one million mt to the US, compared to just 10,864 mt of US steel shipped into Japan.
AISI estimated that approximately 75 percent of steel imports into Mexico now originate outside North America, citing reporting from The Rio Times that Mexican steel output declined in 2025 amid a surge of Chinese-origin material. Mr. Hekhuis also flagged a 26 percent rise in indirect steel exports, meaning steel-intensive downstream goods not covered by trade measures, over the decade ending 2024. He states this to be a volume equivalent to 93 percent of direct steel exports. He pointed to Chinese auto exports as the clearest example, noting Mexico is now the world's top importer of Chinese-made vehicles, up from less than one percent of Mexican vehicle sales five years ago.
USTR initiated the Section 301 investigation on March 11 against China, the EU, Singapore, Switzerland, Norway, Indonesia, Malaysia, Cambodia, Thailand, Korea, Vietnam, Taiwan, Bangladesh, Mexico, Japan and India. Hearings run through May 8.
Should USTR make an affirmative determination, Section 301 authorizes additional tariffs that would stack on top of the existing 50 percent Section 232 duty on steel articles. While USTR has not signaled specific rates, a 10 percent baseline consistent with President Trump's stated tariff floor and the expiring Section 122 duty would push total ad valorem rates on steel mill products from worst-actor countries to roughly 60 percent. A China standard 25 percent 301 layer would push it to 75 percent.
Tariffs would take effect within 30 days of an affirmative determination, with the administration targeting July 24, when Section 122 authority expires, for completion of the investigation.
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