China accused of steel dumping

China accused of steel dumping. by David R. Butcher At a time when the worldwide steel market is falling, many steel producers worry China is poised to dump more cheap steel into the U.S. market. The United States is no longer the steel giant it once was, ranking third in the world for production in 2008, behind Japan and China. The first country ever to produce more than 550 million metric tons in a year, China out-produces the U.S., Japan and Russia combined, producing one-third of the world's steel, according to the World Steel Association (worldsteel). In a statement from the USW union, the steelmakers argue that Chinese mills benefit from subsidies for oil-country tubular goods (OCTG) sold in the U.S. The petition further alleges that Chinese-made OCTG, used to extract oil or gas from drill wells, are being "dumped" on American shores on margins ranging from 40 percent to 90 percent. Subsidized OCTG imports have nearly tripled in volume between 2006 and 2008, U.S. Steel spokesperson Erin DiPietro told the Pittsburgh Business Times this month. In the first quarter of 2008, an estimated 600,000 net tons from China came to the U.S., she said. In 2008, U.S. Steel and other parties filed "a similar case against China regarding circular welded line pipe, also used in the energy industry," the Pittsburgh Business Times reports. Last month the ITC unanimously found evidence of material injury from dumping, clearing the way for tariff duties on the product. The EU currently charges "anti-dumping duties on some Chinese steel imports to protect its steel from below-cost imports," Forbes reports. Last month eight major steel associations from Europe, the U.S., Canada and Central and South America joined to submit comments to the Chinese government on China's current steel industry development plan, voicing concerns regarding the state-sponsored support for China's steel industry. From the recent American Iron and Steel Institute's conference in Phoenix, Purchasing.com reported comments made by company executives protesting steel dumping: Nucor Corp. Chairman and CEO Dan DiMicco and others called for trade agreements to be strictly enforced. DiMicco said U.S. trading partners, especially China, have to be responsible — that they must adhere to agreed-upon rules and not unfairly undercut domestic steel producers. DiMicco said steel companies already have appealed to trade officials and that the government must ensure competition. U.S. Steel, Nucor and AK Steel Holding Corp. recently said "higher import tariffs are needed to help them survive the global recession and the shakeout in the U.S. car industry — one of its biggest customers," the Wall Street Journal reported in February. WTO rules allow countries to raise import tariffs if they can prove dumped goods have directly hurt sales of domestic competitors. The USW and the seven steel producers accusing China of unreasonably low pricing tactics are now calling for U.S. tariff increases of about 37 percent to 99 percent on the OCTG. On April 15, Yao Jian, a Chinese Commerce Ministry spokesperson, stated, "China was highly concerned about the suit and would send a delegation to the U.S. to discuss the matter," according to Xinhuanet. Yao said the U.S. should resist protectionism as it deals with the anti-dumping complaints. "The Chinese business community and the government are highly concerned about this case ... and will take suitable responsive measures," Yao said. (Source: The Sharon Herald) The ITC said in a bulletin that it found "a reasonable indication" that the U.S. industry was materially injured or threatened with material injury from oil country tubular goods from China. The positive determination advances the case to the Commerce Department, which is tentatively scheduled to issue a preliminary countervailing duty finding on July 2 and a preliminary anti-dumping determination on Sept. 15.