South Korea seeks to restrict Chinese H-beam imports

SteelOrbis Shanghai South Korea is currently trying everything possible to deal with the rapid growth in Chinese H-beam imports in an attempt to counter the seriously negative effects its own producers are experiencing. At a meeting held between the two sides on the H-beam issue a few days ago, South Korea proposed that China rein in its H-beam exports to below the 250,000 mt level for 2007. However, China responded in the negative and so the meeting concluded without agreement. The Korea Iron and Steel Association has indicated that Chinese H-beam exports to South Korea will have reached 800,000 mt by the end of this year, accounting for 20 percent of the market share. China currently exports standard size H-beam to South Korea at around $450/mt CFR, and large size at $470-480/mt CFR. Both size categories are $80-100/mt lower than the price of H-beam in the South Korean domestic market. In addition, South Korea's second biggest steel mill, Hyundai Steel Co., is considering making an application to the relevant Korean authorities for an anti-dumping investigation focusing on H-beam against the Chinese steel mills. However, the prospects for such an anti-dumping investigation in the current conjuncture are reported to be unfavorable. One of the reasons is that the brisk demand in South Korea is in need of Chinese products to make up for its current supply deficiency. Meanwhile, it has also been reported that a new production line of Korean giant Dongkuk Steel will commence production by the end of 2006 or in early 2007.