Mid-tier Korean steelmakers may soon be able to export more to
U.S. customers as the government is seeking revisions to the current quota
assigned for steel exports to the world’s biggest economy.
The Ministry of Trade, Industry and Energy plans to change
the criteria for the U.S. steel export quota to annual exports, from the
current system that’s based on 2015-2017 exports, according to documents
obtained by People Power Party lawmaker Ku Ja-keun. The ministry is seeking to
re-assign the quota on a yearly basis and expand export opportunities for
smaller companies.
Under the existing U.S. steel export system, the basic quota
accounts for 95 percent of shipment and the open quota for only 5 percent.
Exporters are allowed to export steel products depending on their shipments
made during 2015-2017, which is beneficial for large steelmakers. The open
quota is literally open to all new steelmakers who seek U.S. exports, but the
volume is relatively limited.
The trade ministry also plans to introduce a shared quota.
Companies that fail to fill up their quota under the basic plan, the unfilled
portion will be put under this new segment to give steelmakers additional
export opportunities starting in January 2024. Under this system, 90 percent
will be for basic quota, 5 percent shared quota and 5 percent open quota.
The existing quota assignment system has faced criticism from
small- and mid-tier steelmakers, as some large corporate steelmakers
practically eat up all of Korea’s allowed export quota, leaving very little
room for newcomers seeking to export to the U.S.
Steelmakers that fail to fill their quota will now see a
revised assignment of export volume, as they will fall into the shared quota
group, which is also a measure to give more opportunities to small- and
mid-tier steelmakers seeking U.S. customers. Under the existing quota
assignment system, those that failed to fill their export quota can still have
the same volume assignment the next year within the basic quota.