The global steel industry is facing serious challenges.

Oversupply and Fierce Competition: The core issue is that production far exceeds consumption, a surplus estimated to reach 721 million tons by 2027. This leads to intense price competition, especially from China, a country with immense production capacity.

Strategic Importance: Steel is considered a “vital” material for the economic and national security of any country, a symbol of industrial power. This makes governments unwilling to reduce production despite the market surplus, creating a “dilemma.”

Challenges for Western Producers: Steel companies in Europe, such as Tata Steel (Netherlands and UK), are under heavy pressure. They face high production costs, outdated technology, environmental pressures (transitioning to green production), and competition from cheap Chinese steel. As a result, many plants are forced to cut capacity, lay off workers, and rely on government subsidies.

US Tariff Policy: The significant tariff policy of President Trump, initially 25% and later 50% on imported steel and aluminum, caused a “domino effect.” It not only reduced European countries’ exports to the US but also diverted the global steel surplus to other markets, especially Europe, worsening the competitive situation.

International Expert Opinions and Impact Analysis

United States US experts and officials often support protectionist policies, seeing them as necessary to protect the domestic steel industry from unfair competition.

Perspective: From the US viewpoint, high tariff policies (applied under Section 232 of the Trade Expansion Act) are a “national security” measure. The goal is to reduce reliance on foreign sources, particularly China, and ensure domestic steel production capacity can meet defense and infrastructure needs.
Impact Analysis:
- Positive (from a US perspective): This policy gives domestic steel producers like U.S. Steel and Nucor a competitive advantage, boosting jobs and domestic investment. It also creates a “wall” to block cheap steel from China and other countries, reducing “dumping.”
- Negative: Independent analysts and international trade experts (such as Elisabeth Braw from the Atlantic Council) point out that this policy can have unintended consequences. It increases costs for steel-consuming industries like automotive, construction, and equipment manufacturing. Furthermore, imposing high tariffs on allies like Europe, Japan, and South Korea can cause trade tensions and weaken strategic alliances.

China China, as the world’s largest steel producer, often denies allegations of dumping and argues that its production is a result of superior manufacturing capability.

Perspective: Chinese experts and the government argue that the production surplus is due to a decline in domestic demand after a construction boom, not intentional dumping. They also oppose US and European tariff measures, calling them unilateral protectionist measures that violate World Trade Organization (WTO) rules.
Impact Analysis:
- On the Global Market: The surplus of steel from China, combined with tariff barriers, creates a “domino effect,” as noted by Lucia Sali, Communications Director of the European Steel Association. Steel unable to enter the US market will find its way to other markets, pushing prices down even further.
- On China: Despite the tariffs, Chinese companies can maintain production thanks to their massive scale, low costs (especially for plants that don’t comply with strict environmental regulations), and strong government support. However, if tariff pressure from multiple countries increases, they will face difficulties in exporting.

Europe Experts and steel associations in Europe (such as Eurofer) often call for stronger protective measures to counter cheap Chinese steel while also opposing US tariff policies.

Perspective: Europe is in a “dilemma.” They want to protect domestic jobs and production capacity but must also adhere to environmental commitments. European experts see US tariff policies as a double threat: they reduce export markets while also causing the surplus steel to be “bottlenecked” into Europe.
Impact Analysis:
- Environmental Challenges: Being forced to compete on price with cheap steel means European companies lack the resources to invest in green technology (like hydrogen-powered electric arc furnaces), a process that is already very expensive and complex.
- Trade Tensions: US tariff policies cause tension with traditional allies, weakening economic alliances. This also complicates international cooperation efforts to address the overcapacity problem.

Other Asian Markets Outside of China Countries like Japan and South Korea are also major steel exporters and are being affected by both China and US tariff policies.

Perspective: Experts from Japan and South Korea argue that they are becoming “victims” of the trade war between superpowers. They produce high-quality steel and generally comply with international regulations but are still caught in a price race due to cheap Chinese steel flooding the market. At the same time, they are also affected by US tariffs.
Impact Analysis:
- Competitive Pressure: Steel from these countries loses its competitive edge in many markets, forcing them to seek new markets and accept lower prices, which reduces profits.
- Seeking Solutions: These countries may strengthen regional cooperation or seek separate negotiations with the US for tariff exemptions, as in the case of the United Kingdom.

The Influence of US Tariffs on the Future of the Steel Market

The US tariff policy could reshape the future of the global steel market in the following ways:

Strengthening Protectionist Trends: The US policy could encourage other countries to adopt similar protectionist measures to protect their industries. This would weaken free trade and globalization, leading to a more fragmented and less efficient steel market.
Accelerating Industry Restructuring: To cope with trade barriers, steel companies will be forced to reconsider their strategies. They may increase investment in advanced technologies, reduce costs, and focus on specialized, high-grade steel products that are less affected by price competition.
Creating New Trading Blocs: Countries may form new trade alliances to counter unilateral tariff policies. For example, Europe could strengthen anti-dumping measures and apply a Carbon Border Adjustment Mechanism (CBAM) to protect its producers, creating a separate trading bloc.
Promoting Green Steel Production: Although costly, environmental policies and market demands may push steel companies to accelerate their transition to green technology. However, this is only feasible with significant government support and subsidies.

In summary, the US tariff policy is not merely a protectionist measure but a catalyst that is exacerbating the existing problems of the global steel industry. It is pushing the industry into a period of major restructuring, with many challenges but also opportunities for businesses that can adapt to new technologies and more sustainable business models.

Source: According to Vietstock and sources compiled from the internet.