Steel Industry Wins Mixed Victory From Trade Panel : Tariffs: The International Trade Commission finds 16 countries guilty of dumping. But dozens of complaints are denied.

In one of the most closely watched trade cases of recent years, the International Trade Commission cleared the way Tuesday for the Clinton Administration to permanently impose punitive tariffs on steel produced in 16 countries accused of dumping their products in U.S. markets.

The action by the independent six-member commission, an agency of the U.S. government, was only a partial victory for the steel industry, which had sought blanket action against its biggest competitors. In cases where the commission found no evidence of injury, temporary duties will be lifted.

Ultimately, the decisions are expected to cause the price of some types of domestic steel--and the industrial and consumer products made from them--to rise, and could prompt retaliatory actions by Germany, Canada and other affected countries.

Their immediate effect, however, was to send the price of steel stocks plummeting. Disappointed investors knocked 13% off the market value of USX’s U.S. Steel Group, which closed at $31.875, down $4.75 in New York Stock Exchange trading.

The commission endorsed an earlier Commerce Department ruling that the 16 countries had put American steel companies at an unfair disadvantage through their pricing or subsidy policies.

At the heart of the dispute is the U.S. steelmakers’ accusation that overseas competitors sold $3.2 billion worth of steel in this country at unlawfully low prices.

The readiness of the Commerce Department to extend temporary penalties last month, pending the International Trade Commission’s decision, was seen as a signal that the Clinton Administration was willing to take a protectionist approach in a controversial trade matter.

The punitive tariffs, which in some cases go as high as 109%, can be appealed to the U.S. Court of International Trade in New York.

So too can the commission’s decisions that no dumping occurred in some cases about which the big U.S. steel companies complained.

The commission found unfair practices in fewer than half of the cases investigated, ruling that dumping or excessive subsidies occurred in 32 of 74 instances it reviewed.

One result of the rulings could be an increase of $1 billion a year in the prices that manufacturers pay for the steel they use to make kitchen appliances, automobiles, computers, telephones and other products--much of which may be passed along to consumers, said Kim Elliott, a policy analyst at the Institute for International Economics, a research organization in Washington.

Under U.S. law, foreign companies are prohibited from selling products here at less than “fair-market value,” a price that takes into consideration the cost of production, with 10% added for overhead and 8% added for profit.

In such cases, penalties can be applied if the Commerce Department determines that sales below the fair-market price have occurred and the International Trade Commission determines that the dumping has damaged U.S. competitors.

In the short term, such determinations protect the sales of U.S. companies and the jobs of their workers. In the longer run, they can raise a serious obstacle to foreign companies that would use their lower prices to permanently knock U.S. companies out of a market.

Before announcing his vote, Commissioner David B. Rohr said the panel--made up of three Democrats and three Republicans--had conducted an investigation of “mammoth proportions.” He insisted that politics had “no bearing on today’s results,” though the issue was of extreme interest to consumers, workers and the steel industry.

The mixed decision did little to resolve a dispute over whether the greatest threat to the once-thriving and now rebounding big steel industry in this country is from the new, smaller and technologically advanced U.S. steel producers known as “mini-mills” or foreign competitors.

The countries cited were Australia, Belgium, Brazil, Britain, Canada, Finland, France, Germany, Japan, Korea, Mexico, the Netherlands, Poland, Romania, Spain and Sweden.

Those named in the complaints but not cited by the commission, were Argentina, Austria, Italy and New Zealand.