Post on 15-Jul-2018
transcript
Infrastructure Investment
• Trump Plan: $1 trillion – Tax credit for private
investment
– Only $150 billion taxpayer money
– Compare to 2015 Highway Bill = $300 billion direct spending
– 50 Million Tons of Steel Needed
Future of NAFTA
• 23-Year Old Agreement
• Opportunity to fix things
• NAFTA will continue to be an important trading relationship
Sources: OECD, WorldSteel, AISI, Fitch Ratings
0
200
400
600
800
1000
1200
1400
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Estimated Steelmaking Capacity & Apparent Finished Steel Use (ASU)
U.S. CHINA U.S. ASU CHINA ASU
Mill
ion
s o
f N
et T
on
s
Section 201 Steel Tariff Ends
(Dec. 2003)
Over 500 Million Tons > Internal Use
China’s Capacity Explosion
The Overcapacity Crisis
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Global Steel Capacity
Global Steel Production
China Steel Capacity
China Steel Production
700 Million
Tons Overcapacity
400 million
500
1000
1500
2000
2500
0
NAFTA Production vs. China’s Exports
0
20
40
60
80
100
120
2016
Cru
de
Stee
l Pro
du
ctio
n (
Mill
ion
s o
f M
etri
c To
ns)
NAFTA Steel Production
United States Canada Mexico
Sources: NAFTA – WorldSteel Summary 2017; China – Worldsteel China Monthly 120
2016
Fin
ish
ed S
teel
Exp
ort
s (
Mill
ion
Met
ric
Ton
s)
Chinese Steel Exports
China
110 mmt 110 mmt
Our industry and nations thrive in a system of free and RULES-BASED trade.
We all lose if we don’t fight trade cheaters and state-supported overcapacity.
The Value of Free Markets
Global Steel Forum
• G20 Summit led to formation of Global Forum on Steel Excess Capacity
• Progress report on the Global Forum expected in 2017
• Key outcomes needed:
– Timeline for capacity reductions
– System of verification
North America - Strong by Nature
• World’s Largest Capital Market
• Self-Sufficiency in Raw Materials
• Abundant & Affordable Energy
• Large Domestic Consumer Market
• Highly Productive Workforces
Trade Laws Must Be Enforced
• Enforcing the rules of free trade is not protectionism
• Trade remedies are key to creating a global free market economy
• We must use the tools available to us to stop illegal imports
• We must pursue new tools when existing remedies fail
Source: US Commerce Dept., AISI
0
50
100
150
200
250
300
350
400
450
Jan-14
Feb-14
Mar-1
4
Ap
r-14
May-14
Jun
-14
Jul-1
4
Au
g-14
Sep
-14
Oct-1
4
No
v-14
De
c-14
Jan-15
Feb-15
Mar-1
5
Ap
r-15
May-15
Jun
-15
Jul-1
5
Au
g-15
Sep
-15
Oct-1
5
No
v-15
De
c-15
Jan-16
Feb-16
Mar-1
6
Ap
r-16
May-16
Jun
-16
Jul-1
6
Au
g-16
Sep
-16
Oct-1
6
No
v-16
De
c-16
U.S
. Im
po
rts (
Th
ou
san
ds o
f N
et
To
ns)
Chinese & Vietnamese Finished Steel Imports (Monthly Totals, 2014-2016)
Vietnamese imports steadily
displaced China’s in 2016!
China
Vietnam
Circumvention Investigation
China Is Still a Nonmarket Economy
• China is making its case to be considered a market economy under the terms of its agreement to join the World Trade Organization (WTO)
• After 15 years, China continues to operate as a non-market economy
• We continue to work with the our governments and our allies to ensure China remains a non-market economy until they make the necessary reforms
NAFTA Finished Steel Imports
11,829,756
15,718,296
18,265,536
23,430,096
21,383,304
30,901,272 30,190,776
24,716,796
0
5,000,000
10,000,000
15,000,000
20,000,000
25,000,000
30,000,000
35,000,000
2009 2010 2011 2012 2013 2014 2015 2016
Met
ric
Ton
s Fi
nis
hed
Ste
el Im
po
rt (
Extr
a-N
AFT
A)
North American Steel Trade Committee, NAFTA Steel Trade Monitor
Imports from outside NAFTA are down 20%
since 2014, but still well above the 5 prior years