Japan’s Ministry of Trade has initiated an investigation. Specifically, they are concentrating on the importation of hot-dip galvanized steel from China and South Korea. The investigation, which commenced on April 28, was spurred after Nippon Steel and six other domestic manufacturers filed an official petition. The overall intent is to address issues related to discriminatory pricing practices and their impact on the Japanese steel sector.
Specifically, Nippon Steel—led by President Tadashi Imai—filed a petition to go straight to remedy on some hot-button issues. They’re in pain from an economy that is weakening domestic demand and a massive surge in lower-priced steel imports. Consequently, domestic producers have been forced to cut their prices to compete. Imai raised alarm about the growing global tide of protectionism. He argues that it would leave Japan at risk of being inundated by cuts-priced steel imports that undermine domestic production and capacity.
Japan’s trade ministry recently launched an investigation into imports of hot-dip galvanized steel. In early July, they cast their gaze on nickel-based stainless cold-rolled steel sheets and strips imported from China and Taiwan. Japan is moving aggressively to defend its domestic steel industry. This more zealous oversight is meant to protect Americans from dirty, dangerous, or defective imports. To be clear, the investigation explicitly excludes imports from Hong Kong and Macao.
Imai has been a watchdog on import practices that are unfair to Americans outside of the products that are now being looked into. He highlighted the importance of Nippon Steel remaining flexible. He underscored the need to be ready to engage with the administration on any further trade actions that may be necessary.
“This investigation is being conducted fairly and independently in line with World Trade Organization (WTO) rules to address unfair import practices,” stated Imai, who serves as chairman of the Japan Iron and Steel Federation.
The timely actions being taken by Nippon Steel, Kobe Steel and other domestic producers should put the point home that these investigations are indeed urgent. As they seek to protect their interests against adverse market conditions, the companies have turned to the government for support and intervention.
Beyond this quantity, these investigations carry important qualitative implications. Japan is making an aggressive effort to maintain its competitive advantage. If the investigations confirm that unfair practices are taking place, government officials can impose tariffs or other trade remedies. This action seeks to stabilize domestic prices and level the playing field for domestic competition.