New Section 232 probe may increase GOES prices

Extending Section 232 tariffs onto imports of transformer laminations and cores may support higher prices for grain oriented electric steel (GOES) in the United States, according to analysts and market participants.

On Monday May 4, the US Department of Commerce initiated a Section 232 investigation into imports of "laminations for stacked cores for incorporation into transformers, stacked and wound cores for incorporation into transformers, electrical transformers, and transformer regulators," aiming to determine if the foreign items pose a threat to national security. Cleveland-Cliffs has said the importation of GOES and the laminations and cores poses a threat to the sustainability of its newly acquired AK Steel Butler Works and Zanesville Works and 1,400 jobs at the two mills.  AK Steel became the sole US producer of GOES in 2015, when Allegheny Ludlum exited the segment, according to an analyst note on Tuesday by Cowen Research. The Cowen analysts said AK Steel brings 250,000 tons of annual GOES capacity under the Cleveland-Cliffs banner and the product line represents about...

Published

Dom Yanchunas

May 07, 2020

23:24 GMT

New York