Commerce Initiates Circumvention Inquiry on Chinese Corrosion-Resistant Steel Routed Through Thailand
If circumvention is confirmed, Nucor and Steel Dynamics recover margin on CORE sales to automotive OEMs and appliance makers — but only if interim duties stick. The real constraint is Commerce's historical speed: circumvention inquiries average 14-16 months to final determination.
That window allows Thai mills to front-load shipments before duties lock in, a dynamic that will pressure Nucor's Q3 and Q4 2026 margins. A faster preliminary finding (within 6-8 months) would force Thai exporters to absorb costs or retreat, benefiting domestic producers immediately.
This signals Commerce is tightening enforcement against transshipment schemes — a tactic that has eroded the effectiveness of existing China trade barriers.
Nucor and Steel Dynamics, representing roughly 40% of U.S. CORE capacity, filed because the Thai workaround was undercutting their pricing on critical infrastructure steel (automotive, appliance, construction).
If Commerce confirms circumvention, it extends duties to Thai-origin CORE, closing a loophole that competitors have exploited for 18+ months. Watch whether Commerce issues preliminary findings by Q4 2026 — the timeline that would trigger interim duties before final determination.
Did Thai mills actually originate the components, or are they merely assembly points for Chinese-made coils? The distinction determines whether Commerce can legally extend duties to Thai producers or must target only the Chinese suppliers.
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