The US is the world's third top steel producer, and the Steele industry is worth around $130 billion annually. That being said, this area has some challenges, with new tariffs being introduced and a potential global trade war that could damage this industry. Many different industries rely on a credible steel industry to be cost-effective. The primary sector impacted by this is the construction business, where steel is the commodity they heavily rely upon. Importing this from other countries could prove expensive; therefore, ensuring that the internal price of steel reSteel at a reasonable rate is even more critical for the construction industry.
Where is Steel in the US?
When buildings are being constructed, it would be scarce for there not to be an element of steel assaulted with it. If you look at companies such as Armstrong Steel that do their entire business out of this, the negative impact of steel prices would severely hit this company and potentially put them out of business. Armstrong Steel uses steel to build all types of buildings, from annexes of homes to large steel buildings.
Over Production
Specifically, in places like China, where there is a lot of steel business, there is evidence of over-production, which reduces steel prices significantly. This directly impacts US steel's cost as people will import it from China. The tariffs then applied by the US to try and offset this is significant enough to make an impact. China has then responded with similar taxes on other goods, and a trade war erupts. Where does excess steel not be sold go? It then gets sold for a loss, which hurts the whole industry.
Low Steel Prices Risk
This is the most significant risk for the US steel industry; however, with the recent global tariffs, this is likely to affect this and bring a level of control internally in the US (although the taxes will have other impacts). Correcting the balance when this becomes an issue is quite tricky. Clearly, consumers are looking to purchase steel at the lowest price possible; however, it needs to be a viable, sustainable business that is healthy for all.
US Steel Companies
Internally, in the US, many big players in the steel industry oversee the government responses regarding tariffs. There is a positive response to the latest government action regarding business viability and share prices. Although this helps the US steel business internally, it can affect any exports it makes, and other countries may get involved in the trade war. There are some problematic steel companies with some financial difficulties; overall, there is a period of growth in this area, and forecasters predict that this will continue in the years to come.
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