Foreign steel debate continues

Korean imports of oil and gas drilling pipes surged by 40 percent between 2010 and 2012, while domestic manufacturers’ margins fell by from 13.6 percent in 2010 to 9.8 percent in 2012, according to International Trade Commission testimony Tuesday.

U.S. Sen. Sherrod Brown testified before the commission, urging the agency to protect American steel manufacturers and the jobs they support by adding tariffs to the imports.

Testimony before the ITC came as the latest step of an ongoing foreign trade case that originated in December when nine U.S. producers of Oil Country Tubular Goods, or OCTG, argued that nine foreign countries were using unfair trade practices that were so serious it could ultimately shut them down.

The complaints came from Vallourec Star in Youngstown, TMK IPSKO in Brookfield, U.S. Steel and six others.

The unfair competition also has affected Warren’s JMC Steel. All these companies make oil country tubular goods for a range of companies that drill for oil and gas.

On Friday, the U.S. Department of Commerce agreed with the companies, ruling that steel pipes dumped from the nine countries have adversely affected domestic operations.

Tuesday, the fight continued before the ITC.

If the ITC determines that steel dumping has materially injured American manufacturers, then trade tariffs can be levied against those imports.

“Two Korean OCTG producers named in the case represent the biggest share of imports flooding our market. But they have no domestic market of their own,” Brown testified.

“There is no drilling for oil and gas in the Korean market, and their entire business is for export to the United States.

“Even though we’re in the middle of a natural gas boom in this country, by some estimates as much as half of the pipe being used to drill for oil and gas is foreign produced.”

Brown argued that while the U.S. industry has invested millions in domestic facilities, producers remain unable to compete with the unfairly subsidized and dumped foreign-made products.

“Vallourec invested $1 billion in their OCTG mill in Youngstown, where they employ 350 employees. Even with this state-of-the-art investment, the mill is struggling to compete against Korean OCTG in the U.S. market,” Brown said.

The ITC is expected to make a decision on tariffs by early August.