Steel buyers and Chinese steelmakers object to U.S. Steel's attempt to get the federal government to block all unfairly subsidized Chinese steel imported into the United States.
The Pittsburgh-based steelmaker, which lost $1.5 billion amid the global import crisis last year, has asked the International Trade Commission to ban steel imports from China's largest steelmakers and their distributors. U.S. Steel has accused them of stealing trade secrets, conspiring to fix prices and misrepresenting where steel came from to dodge tariffs.
The American Iron and Steel Institute, the United Steelworkers Union, JMC Steel Group and other have backed U.S. Steel's petition to the federal government to ban Chinese steel, not just make it more expensive with tariffs.
"If U. S. Steel Corporation shuts down, are we willing to rely upon foreign steel producers?" JMC CEO Barry Zekelman wrote in a letter to the International Trade Commission. "As U. S. Steel CEO Mario Longhi has said, 'You cannot build a steel mill in a time of urgent need; you rely on it being there.'"
But Chinese steelmakers and steel buyers are urging the federal government to throw out the case. Pipe and can makers say U.S. steelmakers don't make the type of metal they need, and Chinese companies like Baosteel argue a ban is too broad and would hurt economic relations between the United States and China.
Hunan Valin, a Chinese company that makes 16 million tons of steel a year, argued in a letter that a ban would be a waste of judicial resources since the United States already imposes 27 anti-dumping and 15 countervailing duty orders tariffs against Chinese steel. It also argues U.S. Steel's beef is with the Chinese government when Hunan Valin is privately owned.
"Although located in China, around 10 percent of the company share is owned by global steel conglomerate, ArcelorMittal, which has 27 industrial operations in 13 US states and employs roughly 20,000 individuals in the United States– that is, 5,000 more than complainant employs domestically," Hunan Valin attorneys wrote in a letter to the International Trade Commission.
Steel buyers warned of higher prices and short supplies – in one case, no supply whatsoever. The Allstate Can Corp., a New Jersey company that employs 80, also asked for the case to be dismissed, saying U.S. Steel and ArcelorMittal don't furnish it with the metal it needs to manufacture tin cans, so it has to turn to China.
"Our largest customer requires a soft temper and thin gauge sheet," Vice President Michael Papera wrote. "We have been told by OCC that ArcelorMittal is not interested in supplying because 'they say they have to roll three coils to get one good one and that is not cost-effective.'"
U.S. Steel is asking its 300 suppliers to send letters of support, and already has several letters backing its Section 337 case, which has been described as a bold and unprecedented step in the war against cheap, and often illegally dumped or subsidized imports. USW President Leo Gerard wrote the federal government must intervene after the idling of mills like East Chicago Tin and the loss of more than 13,500 jobs.
"Tens of thousands of workers, directly employed in the sector and those depending indirectly on their employment, are at risk," he wrote in a letter. "The corrosive impact of these practices undermines wages and compensation with resulting serious adverse effects on our tax base and the provision of services across the nation. From education to emergency responders to public health, the adverse consequences cannot be overestimated."
Source: nwitimes
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