Japan's steel industry urges Trump to make careful trade decision

TOKYO (Reuters) - Japan's steel industry said on Monday the U.S. Commerce Department proposal to President Donald Trump to impose curbs on steel imports violate the principles of free trade, calling for Washington to make a careful and appropriate decision.

The U.S. Commerce Department recommended on Friday that 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.

"The recommendations violate the principles of free trade, which are the foundation for development and prosperity of the global economy," Japan Iron and Steel Federation Chairman Kosei Shindo said in a statement.

"We hope Trump would make a careful and appropriate judgement," said Shindo, who also heads Japan's biggest steelmaker Nippon Steel & Sumitomo Metal Corp.

Yasuji Komiyama, director of the metal industries division of Japan's Ministry of Economy, Trade and Industry, on Monday declined to comment on the U.S. Commerce Department's proposal, saying a U.S. final decision has not been reached.

"But Japan believes any steel and aluminium imports by the U.S. from Japan do not pose any threat to the U.S. national security," he said.

Japan exports about 2 million tonnes of steel products a year to the United States, only about 5 percent of its total steel shipments abroad, but the nation's steelmakers are concerned over the U.S. trade policy.

"My biggest fear is how far President Trump will close down trade," Eiji Hayashida, president of JFE Holdings Inc, Japan's No.2 steelmaker, said last week.

"If the U.S. takes action (to curb imports), it may trigger retaliation by other countries. What is most troublesome is to see the world heading to protectionism," he said.

Nippon Steel's senior executive also said the company is worried that U.S. trade action could flood Asia with steel products as there is nowhere else for them to go.

"I don't know if a U.S. move would really make U.S. steelmakers, steel users and consumers happy," Kiyoshi Imamura, Managing Director at Tokyo Steel Manufacturing, Japan's top electric-arc furnace steelmaker, said on Monday.

Some U.S. lawmakers and steel and aluminium users have urged caution in taking any trade actions that could cause disruptions or price spikes in raw materials that are found in everything from autos to appliances and aircraft and construction.

(Reporting by Yuka Obayashi; Editing by Tom Hogue)