labels: Trade, World economy
US steel makers, union file anti-dumping case against China news
09 April 2009

Seven US steel manufacturers and the United Steelworkers union (USW) today filed an anti-dumping and countervailing duty trade case against China with the US Department of Commerce (DOC) and the US International Trade Commission (ITC) for dumping certain types of tubular and pipe steel in the country last year.

In the biggest ever anti-dumping case filed by the US against China, the US steel manufacturers allege that Chinese producers benefit from massive government subsidies and dumping margins ranging from 40 to 90 per cent.

The increase in Chinese imports of tubular and pipe steel has hit the US steel industry, already reeling under the global recession that increases the impact on jobs in the steel and pipe manufacturing sector.

USW International President Leo Gerard said that, ''There are more than 2,000 workers currently on layoff at companies making tubular and pipe steel. We cannot let China get away with targeting these family-supportive and skilled jobs through predatory trade practices.''

US steel companies have filed many anti-dumping cases against China in the past two years and were successful in winning four cases in the tubes and pipes case against China.

Although the US steel manufacturers win more anti-dumping cases than they lose against China, the end result is that either a quota is applied or at times extra surcharges.

The seven steel manufacturers who filed the anti-dumping case are US Steel Corp., Pittsburgh, Pa.; Maverick Tube Corp., Hickman, Ark.; Evraz Rocky Mountain Steel, Pueblo, Colorado.; TMK IPSCO, Downers Grove, Ill.; V&M Star, LLP, Houston, Tx.; V&M TCA, Houston, Tx.; and Wheatland Tube Corp., Beachwood, Ohio as well as the USW.

With Chinese steel being heavily subsidised by its government, Chinese steel imports into the US have tripled from 750,000 tons in 2006 to 2.2 million tons in 2008 and have continued increasing in the first quarter of this year.

These imports significantly undersold the US steel manufacturers, who already have a huge inventory build up due to the declining demand in the US since buyers such as automakers, equipment manufacturers, builders and commercial construction companies have drastically reduced their orders, due to a slump in their respective industry.

According to Roger Schagrin, trade counsel representing the seven domestic companies and the United Steelworkers union, said, ''Tubular and pipe steel imports from China are subject to very high antidumping and countervailing duties in Canada, the world's second largest market.''

Schagrin also said the European Union also made a preliminary dumping determination of margins ranging from 35 to 51 per cent against China imports of seamless pipe.

China exported over 600,000 tons to the EU last year, much of which China could potentially now shift towards the US, since this product gets a better price in the US than other parts of the world.

Under US trade law the ITC must make a preliminary injury determination no later than 26 May, 2009. The DOC is expected to issue a preliminary subsidy finding by Sept. 8, 2009, and a preliminary dumping finding by 6 November, 2009.

Indian action
In December, India also launched an antidumping investigation into imports of stainless cold-rolled flat steel products and hot-rolled steel products from China and other countries. (See: India to probe steel dumping allegations)

In November, India's steel imports jumped more than 70 per cent to 14 lakh tonnes against 8 lakh tonnes in the same month a year ago, and the sharp rise in imports was due to low-priced shipments coming from China, Thailand and Ukraine into India at $450-500 per tonne, 25 per cent cheaper than the international price, then ruling at $600-700 per tonne.

Until July last year, the US steel industry was enjoying a boom, fuelled by the high demand for steel in China that led to unprecedented profit levels for steel companies. As a result shares of US Steel traded almost $192 a stock, while that of Nucor peaked at a 52-week high of $83.56 in May.

However, by August, orders for steel products from China, North America and Europe started to subside, causing prices of some steel product to decrease by up to 40 per cent, while shares of US Steel plummeted 68 per cent.

By mid-December domestic raw steel production was down 44 per cent compared to 2007 figure, while steel mills operated at slightly less than 50 per cent of their capacities, according to the American Iron and Steel Institute and the US steel industry was seeking a bailout, similar to the one given to the auto industry. (See: Now, US steel industry asks for government bailout)

So the plant closings have been mostly at the integrated mills, whose 50,000 workers - roughly 40 per cent of the nation's steelworkers - are represented by the United Steelworkers. The union says that early this year it expects 20,000 workers to be on furlough, of which half have already been affected.


 search domain-b
  go
 
US steel makers, union file anti-dumping case against China