Commission Extends Anti-Dumping Duties on Imported Steel

CHICAGO _ In a decision that will cheer domestic steel producers but disappoint U.S. manufacturers that buy steel to make their products, the U.S. International Trade Commission voted Wednesday to extend anti-dumping duties on hot-rolled steel imported from China and five other countries.

The fight over the import duties on hot-rolled steel represents the latest flashpoint between the U.S. steel industry and U.S. steel consumers.

The domestic steel industry argues that U.S. steelmakers need protection, in the form of “anti-dumping” and countervailing duties, from low-cost steel imports from China and certain other countries that don’t abide by U.S. trade rules.

But steel-consuming industries, including U.S.-based automakers and a host of other manufacturers, contend that the tariffs hurt the nation’s industrial sector, contribute to the migration of U.S. production jobs to Asia, and raise prices for Americans. The once deeply troubled U.S. steel sector has consolidated and enjoyed a solid rebound, tariff opponents add, and as a result the smaller U.S. steel industry doesn’t need the protections it once did.

The ITC’s “unfortunate” ruling on the controversial issue represents “another blow” to the struggling manufacturing sector, said the Precision Metalforming Association, a trade group that represents steel-purchasing companies.

“The ITC’s refusal to end the duties is further evidence that U.S. trade laws are badly in need of reform” echoed another such group, the Consuming Industries Trade Action Coalition.

Import duties, which protect domestic makers by raising the U.S. price of imported products, are normally established for a specified number of years, after which they routinely expire unless the ITC specifically votes to continue them.

The commission has in recent months been conducting a “sunset review” on whether or not to end existing duties on hot-rolled steel imports from 10 countries: China, India, Indonesia, Kazakhstan, Romania, South Africa, Taiwan, Thailand and Ukraine.

On Tuesday, the independent government agency said it decided to allow duties to lapse on imports from Argentina, Kazakhstan, Romania and South Africa.

It left the duties in place, however, on imports from leading import producer China, as well as India, Indonesia, Taiwan, Thailand and Ukraine.

Commissioners “correctly recognized” that such imports would injure the domestic steel industry if the duties were removed, said Alan Price, an attorney for Charlotte, N.C., steelmaker Nucor Corp. “China has a staggering amount of excess capacity,” he said, and the other countries covered by the decision “depend on exports to maintain production.”

But while Nucor’s legal counsel hailed the extension of the duties as being “critical to the domestic steel industry,” steel buyers were saying the tariffs distort the marketplace in order to help domestic steel makers.

The duties have “outlived their usefulness,” said CITAC executive director Steve Alexander.

“Today the U.S. steel industry by its own admission is healthy and will continue to be profitable for the foreseeable future, while America’s steel consuming industries, who employ nine million Americans, are struggling with steel supply problems and high prices.”

Under current U.S. trade law, CITAC noted, consuming industries are left out of the tariff-setting process, and the ITC doesn’t examine the impact trade restrictions have on U.S. industrial users of those products.

The steel-consumers’ group is pushing for approval of proposed legislation labeled the “American Manufacturing Competitiveness Act,” which would give industrial users full “interested party” standing in cases where the International Trade Commission is considering imposing import duties.

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(c) 2007, Chicago Tribune.

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