Metal Exporters Breathe Easy Amid US Tariff Exemptions

In a surprising turn of events, the White House has decided to exempt steel and aluminium from an additional 27% duty, much to the relief of metal exporters. This decision comes after a 25% tariff was imposed on these materials last month, which are crucial for manufacturing a wide range of products from automobiles to kitchen appliances.

Industry Reactions and Future Implications

Prashanth Kota, a lead analyst at Choice Broking, noted that the immediate impact on the sector is minimal, given India's modest exports to the US. However, he warned of potential secondary effects should a tariff conflict arise between the US and other major economies. Amar Ambani of Yes Securities highlighted how the unchanged tariffs could lead to increased domestic prices in the US, while also pushing exporters from countries like Vietnam, Japan, and South Korea towards India and the Middle East, potentially flooding these markets with cheap steel imports.

Looking Ahead: Copper and Safeguard Measures

While copper has been spared for now, future assessments may lead to similar tariffs, reshaping trade dynamics. Kota also mentioned the potential protective effect of India's proposed 12% provisional safeguard duty on steel, which could shield the sector from the spillover effects of ongoing tariff disputes.