Steel companies hail ruling versus China
By LARRY RINGLER and CHRISTOPHER KROMER Tribune Chronicle
POSTED: June 21, 2008
Union and company officials at Wheatland Tube, which has plants in Howland and Niles, hailed a unanimous ruling Friday by the U.S. International Trade Commission to impose antidumping tariffs on certain Chinese steel pipe.
The 5-0 decision followed an affirmative ruling by the U.S. Department of Commerce May 30, which identified illegal Chinese subsidies. Friday’s decision states those subsidies have had an adverse affect on American pipemakers.
The ITC’s decision will allow duties ranging from 69.20 percent to 85.55 percent for five years, the industry said. The decision also will result in a countervailing duty order imposing duties that range from 29.57 percent to 615.92 percent, with an average subsidy rate of 37.22 percent.
The pipe case is the first to clear all the government hurdles for the tariffs to go into effect. Last year, the Commerce Department imposed penalty tariffs on imports of Chinese glossy paper, but the trade body blocked the tariffs by ruling that the domestic industry had not proven it was being materially harmed by the imports.
Wheatland was one of six manufacturers, along with the United Steelworkers, that filed the initial petition to protect domestic makers of the pipe used in plumbing, heating/air conditioning systems and sprinklers, among other things.
The companies and union said Chinese pipe imports rose from 10,000 tons in 2002 to 750,000 tons in 2007, causing U.S. plant closures and the loss of 500 jobs.
Bill Kerins, president of Wheatland Tube Co., which has 1,340 area workers, said he hopes the decision will spark a turnaround for domestic steel producers.
‘‘Certainly Wheatland and the industry as a whole are pleased,’’ Kerins said. ‘‘We’re looking at this as an opportunity to regain lost sales to China to benefit not only the company but our employees as well.’’
At a news conference Friday at the company’s Wheatland, Pa., factory, Dennis Bowser, president of the 171-worker USW Local 9306 at Wheatland Tube Co.’s Howland plant, said the ruling should give his members job security. ‘‘Hopefully, we can look for expansion. We can compete with anyone.’’
Mark Spina, whose 50 members at Wheatland’s Niles plant are linked to Local 1375 in Warren, said everyone’s ‘‘morale is looking up, especially when I tell them about the decision.’’
They said China had been selling galvanized circular welding pipe in the United States for $580 a ton. Domestic companies like Wheatland were paying $600 for steel and $200 for zinc alone, before starting any production, union officials said.
A spokesman for U.S. Rep. Timothy J. Ryan, D-Niles, said the undervaluation of Chinese currency may have played a part in providing China an unfair competitive advantage.
‘‘The fact that China can produce, ship and sell their tube for the same price it costs Wheatland Tube to buy their raw materials is proof enough to us that their currency valuation has played a role in this,’’ the spokesman said. ‘‘If we get a level playing field, our workers can compete with anyone in China, India and abroad. That’s why the congressman is 100 percent committed to fighting these issues.’’
In a conference call with reporters, Leo W. Gerard, international president of the United Steelworkers, said he hoped the decision would highlight failings in American trade policy.
‘‘This is a tremendous victory, and it should be a lesson to members of the House and Senate that we need a new trade policy,’’ Gerard said.
The circular welded pipe case is one of a number that already have been filed accusing the Chinese of providing their manufacturers with unfair subsidies. Other cases involve different types of pipe as well as tires, lightweight thermal paper and laminated woven sacks.
The U.S. trade deficit with China hit an all-time high of $256 billion last year, an amount equal to one-third of the total U.S. trade deficit and the largest imbalance ever recorded with a single country. Critics contend that the soaring trade deficits have played a major role in the loss of more than 3 million U.S. manufacturing jobs since 2001.
Unfair Chinese subsidies, experts claim, ranged from loans at preferential interest rates from government-controlled banks to Chinese companies to government subsidies aimed at reducing energy overhead costs for Chinese businesses.
The companies bringing the pipe case were Allied Tube & Conduit, IPSCO Tubulars Inc., Northwest Pipe Co., Sharon Tube Co., Western Tube & Conduit Corp. and Wheatland Tube Co.
Steelworkers spokesman Michael ‘‘Mickey’’ Bolt said China is believed to have provided energy subsidies worth $25 billion over five years to its steel industry alone.
‘‘If we want to maintain a manufacturing base, we have to stop their subsidies or get subsidies here,’’ he said.
The Associated Press contributed to this report.
ckromer@tribtoday.com
lringler@tribtoday.com
