The US Commerce Department has recommended that President Donald Trump impose steep curbs on steel and aluminium imports from China and other countries, ranging from global and country-specific tariffs to broad import quotas, according to proposals released on Friday.
China's Commerce Ministry responded by saying the report was "baseless" and did not accord with the facts, and that it will take necessary steps to protect its interests if the final decision affects China.
The long-awaited unveiling of Commerce's 'Section 232' national security reviews of the two industries contained global tariff options of at least 24 per cent on all steel products from all countries, and at least 7.7 per cent on all aluminium products from all countries.
Trump authorised the probes under a 1962 trade law that has not been invoked since 2001. He has until April 11 to announce his decision on steel import curbs and by April 20 to decide on aluminium restrictions.
Commerce Secretary Wilbur Ross emphasised that Trump would have the final say, including on whether to exclude certain countries, such as NATO allies, from any actions.
"The president has the discretion to modify any of these or to come with something totally different," he told reporters on a conference call.
He said a global tariff would cover every steel and aluminium product entering the American market from China.
China's Commerce Ministry urged the United States to exercise restraint in using trade protection tools, respect the rules of multilateral trade and make a positive contribution to the international economic and trading order.
"If the final US decision affects China's interests, China must take necessary measures to protect its own reasonable interests," the ministry added, without giving details.
Steel stocks soared with US Steel closing up 14.7 per cent, AK Steel up 13.7 per cent, Nucor ended up 4.5 per cent and the broader S&P 1500 steel index 5.3 per cent higher.
Century Aluminum shares closed up 8.3 per cent, while Alcoa, which has operations across the globe, ended off 0.44 per cent.
Alcoa said in a statement the US trade actions should focus on Chinese overcapacity and not penalise nations that abide by the rules.
Ross said he would not be surprised if countries challenged the measures at the World Trade Organisation.
Trump met with a bipartisan group of US senators and representatives at the White House last week, signalling he would take at least some action to restrict imports of the two metals.
Some US lawmakers and steel and aluminium users have urged caution in any restrictions to avoid disruptions or price spikes in the raw materials, used in everything from autos to appliances and aircraft and construction.
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