December 31, 2009 in Business

Steel trade ruling backs U.S. industry

China’s subsidized exports a threat, commission says
Peter Whoriskey Washington Post
 
File Associated Press photo

A steelworker labors at a small-scale steel plant in Shenyang in northeast China’s Liaoning province in June. According to the six U.S. companies that filed a complaint along with the United Steelworkers, Chinese government subsidies to steelmakers allowed the Chinese firms to overwhelm their U.S. rivals.
(Full-size photo)

WASHINGTON – The U.S. International Trade Commission has ruled that a surge of subsidized Chinese steel has harmed or threatens to harm the U.S. industry, in one of the largest ever trade cases involving the two countries.

The volume of steel pipes imported from China more than tripled between 2006 and 2008, rising from $632 million to $2.6 billion, according to the Commerce Department.

The case means that the United States can collect duties on the Chinese imports.

“This is great news for the U.S. steel industry,” said Roger Schagrin, attorney for the U.S. steelmakers and the United Steelworkers union.

The case also promises to heighten trade tensions between the countries, which were aggravated earlier this year, when the Obama administration put a tariff on imported Chinese tires.

According to the six U.S. companies that filed the complaint along with the United Steelworkers, Chinese government subsidies to steelmakers allowed the Chinese firms to overwhelm their U.S. rivals. The U.S. companies alleged that their Chinese rivals received discounts on raw materials and loans from government-owned firms.

Citing preliminary decisions in the case, the Commerce Department in November imposed duties on the steel pipes from China ranging from 10 percent to 16 percent. The ITC decision allows the duties to remain in place.

The steel pipes at issue are used primarily by the oil and gas industry and are known as “oil country tubular goods.” By dollar volume of imports in the industry, the case represents the largest U.S.-China trade case ever, lawyers said.

Schagrin said about half of the workers involved in the particular type of steel in the case had been laid off “because of the massive flood of imports from China. That may now change.”


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