Vote May Lead to Stiff Tariff on Japanese Steel
A U.S. trade panel on Friday ruled that hot-rolled-steel imports from Japan are injuring domestic companies, a decision that clears the way for the Commerce Department to impose duties that could price the foreign steelmakers out of that market.
The 6-0 vote by the International Trade Commission handed the U.S. steel industry its latest triumph in a campaign to drive out imports it contends are sold at unfairly low prices, forcing the companies to idle plants and eliminate thousands of jobs.
“I’m pleased we had a victory,” said Keith Busse, president and chief executive of Steel Dynamics Inc. of Fort Wayne, Ind., one of 12 companies, including Bethlehem Steel Corp. and LTV Corp., that filed the case in September. “Justice was served.”
Kawasaki Steel Corp. of Japan will have its shipments slapped with a 67.14% tariff, Nippon Steel Corp. faces duties of 19.65%, and NKK Corp. must pay 17.86% more, the Commerce Department said in April.
Those duties--retroactive to February and to be in effect five years--couldn’t be collected until the ITC, an autonomous government agency that monitors the effects of trade on U.S. industries, decided the imports harmed the domestic industry.
Hot-rolled steel, a basic variety of the metal used in pipe and finished into more expensive steel for use in appliances and auto parts, makes up 20% of steel imports. U.S. companies have also pursued actions that could lead to duties on steel plate and cold-rolled steel and lobbied the Clinton administration and Congress for other restrictions on imports.
Japanese steelmakers attacked the ruling, saying it reflected rising protectionism in the U.S.
“The decision is unjustified, ill-conceived and counterproductive,” said Masaki Sato, president and chief executive of Nippon Steel USA Inc., a division of Nippon Steel, the world’s second-largest steelmaker. “Facing the overwhelming political pressures, the commissioners ignored the facts.”
Sato said the decision is unfair because Japanese companies sold hot-rolled steel to U.S. steelmakers themselves last year. Also, the Japanese industry has invested heavily in the U.S. and has joint ventures with U.S. companies across the country.
Japan’s steel shipments to the U.S. soared to record levels last year, partly because the U.S. economy was able to absorb the imports. Imports from Japan have since declined and were 56.2% lower in April than a year earlier by volume, according to the Commerce Department.
Japan is the biggest steel exporter to the U.S., with shipments totaling $4.1 billion last year, according to its Ministry of Finance. More than a quarter of the hot-rolled steel the U.S. imported last year came from Japan.
Nippon Steel may file a lawsuit against the U.S. with the U.S. Court of International Trade and is considering lodging a complaint with the World Trade Organization, Sato said. The company contends that increased competition among U.S. producers, not increased imports, made steel prices fall.
U.S. steelmakers blame steel imports, which rose 33% to 37.7 million metric tons last year, for a decline in profits.
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