Published by: Robert England<>
24 Mar 2025 @ 22:00 UTC

Morgan Stanley issued a research report on Monday March 24 that calls for the US to implement a full ban on all imports of semi-finished steel as a way to further strengthen trade protections for the American steel industry.
“We believe that an outright ban of imports of semi-finished steel would ensure that steel is not only rolled in the US, but also melted and poured domestically,” wrote report authors Carlos De Alba, Alain Gabriel, Ariana Salvatore, Eric N. Zurmuehle, Justin A. Ferrer, Adahna Ekoku and Bradley Tian — equity analysts and strategists in the US and the UK.
“If the US placed a ban on semi-finished products, many US re-rollers would have to change the feedstock to rely on domestic steelmakers’ slab production for their finishing lines,” the report stated.
Morgan Stanley Research estimated that the US imports $3 billion of semi-finished products from all countries. The largest exporter is Brazil, accounting for 3.5 million tonnes per year of material in 2024, or about 60% of semi-finished steel imports, the report stated.
But the research authors noted that Brazil did not exceed its quota limits under Section 232 tariffs, in the years during the time the quota was in effect.
Brazil’s quota was eliminated on February 10 with President Donald Trump’s executive order that ended exclusions, restoring the the full 25% tariff under Section 232.
A full ban would “move one step beyond then-President Biden’s 2024 policy, which stated that steel imported from Mexico should be ‘melted and poured’ within the borders of Mexico, Canada or the United States to be eligible for certain tariff exemptions.”
The report states the “melted and poured” rule was designed to prevent exporters from circumventing US tariffs from steel producers outside North America that ship materials to Mexico or Canada “to be minimally processed” and then exported into the US.
The United States-Mexico-Canada Agreement (USMCA) required 70% of automotive steel be melted and poured in North America by 2027.
The Morgan Stanley report stated that billet and bloom imports have increased materially since the implementation of Section 232 tariffs in 2018, led by Romanian exports of 400,000 tonnes per year, representing 50% of all billet and bloom imported into the US.
The large increase in billet and bloom imports “is reshaping the semi-finished good market for long products,” the report stated.
Morgan Stanley stated in a note within the report that it “is acting as financial adviser to US Steel Corporation in connection with a potential arrangement under which SunCoke Energy, Inc. would acquire US Steel’s two blast furnaces at Granite City Works and build a 2-million-ton granulated pig iron production facility. Upon completion of the proposed facility, SunCoke would supply US Steel access to 100% of the pig iron production for the next ten years.”
“The proposed transaction is contingent upon several conditions, including the negotiation and execution of a definitive agreement, approval by the US Steel board of directors and receipt of all appropriate regulatory approvals. US Steel has agreed to pay fees to Morgan Stanley for its financial services that are contingent upon consummation of the proposed transaction,” the note stated.
SunCoke announced in October that it extended its coke-making contract with US Steel until June 30 amid delays in its Granite City granulated pig iron (GPI) project.
While not commenting on the Morgan Stanley proposal directly, the Steel Manufacturers Association (SMA) praised Trump’s efforts to eliminate exemptions and exclusions from the Section 232 tariffs.
President Trump’s actions are revitalizing the steel industry. The bold decision to eliminate any of the loopholes that previously weakened the 232 tariffs enhances an already powerful presidential tool,” SMA president Philip Bell said.
“SMA has long been a supporter of a melted-and-poured requirement for North American steel. What the administration is doing updates the 232 tariffs to make them more effective and aligned with the original intent. The SMA and our members will continue to work with the administration on methods to combat unfair trade.