The U.S. agreed to exempt South Korea from 25% tariffs on steel but imposed a quota on steel imports, Reuters reported, citing the Asian country's trade ministry.
The third-largest steel exporter to the U.S. will have a quota of about 2.68 million tonnes of steel exports, or 70% of the annual average Korean steel exports to the U.S. between 2015 to 2017, which will be exempt from tariffs, the ministry said.
The agreement gives South Korea the first indefinite exemption, albeit with quota, on steel tariffs that took effect March 23. U.S. President Donald Trump temporarily excluded six trade partners, including Canada, Mexico, Australia and the EU.
South Korea's steel association expressed "relief" that South Korea was excluded from the steel tariffs, adding it was regrettable the country did not receive more quotas for steel exports. South Korean steelmakers' shares rose sharply March 26, led by Dongbu Steel Co. Ltd., which was up 5.09% as of 12:24 a.m. ET.
South Korea, meanwhile, agreed to give ground on automobile trade regulations by agreeing to changes in the bilateral free trade deal known as KORUS. South Korea and the U.S. agreed that U.S. tariffs on Korean pickup trucks will be extended until 2041 from the previous phase-out period of 2021, Reuters said.
Under the revisions, U.S. automakers will also be able to bring 50,000 vehicles annually into South Korea per automaker that passes U.S. safety standards, not necessarily Korean standards; double the previous number. South Korea also said it will "take into account U.S. standards and global trends" when the country finalizes its fuel economy and emissions rules.