US tariffs on steel and aluminum were doubled, but the metal markets appear to have quickly absorbed the impact.
Aluminum prices on the LME have already fully rebounded to approximately $2,440 per ton after a brief dip.
“The market therefore does not currently seem to expect any major impact on the global supply situation for the raw materials affected,” Thu Lan Nguyen, head of FX and commodity research at Commerzbank AG, said in a report.
According to experts, tariffs usually lead to a shift in demand to other substitutes.
An immediate increase in US production capacities for aluminum and steel is improbable, given their typically slow response times. Therefore, this trend is expected to be even more pronounced for these materials, according to Commerzbank.
The US steel market is, fortunately, not excessively tight.
US steel mills demonstrated strong capacity utilisation last year, operating at 72-78% during the first eight months. This high domestic output largely met consumption needs, evidenced by imports constituting a mere 13% of apparent consumption.
