(Yicai) Feb. 5 -- The United States has raised tariffs on Chinese steel exports to 35 percent, but the impact on direct exports is expected to be limited, according to the chairman of steel information provider SteelHome.

Only a small portion of steel products are directly shipped to the US, making the impact of increased tariffs relatively minor, Wu Wenzhang told Yicai.

However, the new tariff measures also cover downstream products containing steel, such as construction machinery, home appliances, and new energy vehicles. If exports of these products are restricted due to higher tariffs, the indirect impact on steel exports could be more significant, Wu noted.

The Donald Trump administration's additional 10 percent tariffs on Chinese imports to the US took effect yesterday. This increase comes on top of last year's steel and aluminum tariff hike to 25 percent from as much as 17 percent.

China's steel exports to the US have been declining in recent years, with more steel being directly exported to members of the Association of Southeast Asian Nations and Gulf Cooperation Council nations, Ge Xin, deputy director at Lange Steel Information Research Center, told Yicai. The latter includes nations such as Qatar, Saudi Arabia, and the United Arab Emirates.

China exported 110.7 million tons of steel last year, a 23 percent increase from 2023, according to customs data. Vietnam received the largest share at almost 12 percent, followed by South Korea and the UAE at 7.4 percent and 5 percent, respectively. The US accounted for only 0.8 percent of the total.

The immediate effect on steel-containing products will be a profit decrease, but more profound impacts may emerge in the second half of this year, per Ge. Moreover, China and the US may impose additional tariffs on each other or even introduce other trade barriers, he said, adding that the US might pressure its allies to raise tariffs or impose anti-dumping duties on Chinese steel products, or restrict transit trade from third countries through origin tracing.

Editor: Emmi Laine