Higher steel costs for U.S. manufacturers and a drop in high-value exports are a potential outcome of an executive order by President Donald Trump to abandon the Trans-Pacific Partnership (TPP) trade pact, said consultancy Wood Mackenzie.
"Surprisingly despite the headlines, the reversal of this policy is not an entirely positive outcome for the U.S. steel industry," analysts wrote in a note released on Jan. 26.
Trump said the decision was aimed at keeping jobs in the U.S., but Wood Mackenzie noted the country has gained more from its steel exports than what it spent on imports.
In 2015, around 30 percent, or 11 million tonnes, of all steel imported into the U.S. came from the countries in the TPP at a value of approximately $11 billion. At the same time, 89 percent or around 9 million tonnes of all steel exported from the US was destined to these countries– at a value of approximately $12 billion.
The value of the exported material was also over 40 percent higher than what was imported with the shipped material averaging $1,400 a metric ton while what was imported cost $972 a ton.