The underlying problem is that several large steel-producing countries and regions operate their domestic industries in a state of perpetual overcapacity. If domestic sales are good, they cut back on exports. If demand from local customers falls, they try to export more. This is easy when it comes to exporting more steel to the U.S. Because these producers are always making some sales in America, the organizational infrastructure is in place to service imports. Dock operators and customs brokers are familiar with steel.
Trading companies have permanent offices from which to service customers.
And a goodly number of steel buyers have already qualified off-shore mills as suppliers. The mission to sell more foreign steel in the U.S. is thus quite easy. The trading company contacts the already developed customers, which are more than willing to buy more in return for a price cut. The increased imports drag down prices. As we saw in the 1998 surge, foreign suppliers competed with one another to unload their excesses first, which drove down prices even more.