* S.Korean producers escape tariffs in preliminary ruling
* Shares fall in Vallourec, Tenaris, U.S. Steel and others
* Final decision by U.S. authorities expected in August
(Recasts, adds US steel comment and other details)
By Michel Rose and Silvia Antonioli
PARIS/LONDON, Feb 19 Shares in companies
producing steel tube for the oil and gas industry in the United
States tumbled on Wednesday after U.S. trade authorities decided
not to impose tariffs on the South Korean imports that compete
The U.S. Department of Commerce launched an investigation
last July in response to a petition from producers including
Europe's Tenaris, Vallourec North American
companies Northwest Pipe Company and U.S. Steel,
and Russia's TMK, all of which have production or
manufacturing sites in the United States.
The group complained that manufacturers in South Korea,
India and seven other countries were selling the kind of steel
pipe mainly used by oil and natural gas producers at unfairly
low prices in the United States.
In a preliminary decision dated Feb. 18, the Department of
Commerce said it had found dumping of imports from India, the
Philippines, Saudi Arabia, Taiwan, Thailand, Turkey, Ukraine and
Vietnam, but not from South Korea's Hyundai Hysco
and Nexteel Co.
U.S. imports of South Korean oil country tubular goods
(OCTG), used to drill for oil and gas, were at 894,000 tonnes in
2013, more than the imports from all eight other countries
combined, according to brokerage Cowen and Company.
Following the announcement, shares in the companies that
filed the petition fell.
"Many people in the market were thinking that the key for
improving the pricing power would be some reduction in the
imports coming from South Korea," Natixis analyst Julien Laurent
Tenaris and Vallourec shares were down by 7 percent and 4.5
percent respectively by 1536 GMT, making them the biggest losers
on Europe's broad STOXX 600 as traders cited the U.S.
anti-dumping ruling as hitting the sector.
"There was expectation that South Korea would be included,
which would have been good news," one Paris-based trader said.
Shares in U.S. Steel and Northwest Pipe Company were down by
6 percent and 1.5 percent respectively while shares in Russia's
TMK lost more than 10 percent.
Shares in Hyundai Hysco were 4.5 percent up.
France's Vallourec, which made 29 percent of its sales in
North America in 2012, is a big manufacturer of pipes in the
United States, having built a $650 million plant in Ohio to
capitalise on the U.S. shale gas boom. It had joined the case
against Asian-based manufacturers.
Tenaris owns U.S. manufacturer Maverick Tube Corporation and
TMK also produces steel pipes in the U.S through its subsidiary
A spokeswoman for Vallourec noted that the decision was a
preliminary ruling and said that "a counter investigation is
expected to be launched".
U.S. STEEL DISAPPOINTED
U.S. producers were asking for anti-dumping duties as high
as 240 percent on India, 158 percent on South Korea, 118 percent
on Thailand and 111 percent on Vietnam to offset what they said
was below-market pricing. They asked for lesser, but still
hefty, duties on the other countries.
Imports of oil country tubular goods (OCTG) from the nine
countries totalled nearly $1.8 billion in 2012, more than double
the 2010 total, as rising U.S. oil and natural gas production
"We are disappointed by the preliminary determinations at
the Department of Commerce and by its failure to deal with
important issues at this stage of the investigations," a
spokeswoman for U.S. Steel said.
"Having said that, the determinations do confirm the
existence of large-scale dumping in this market - something that
has caused extensive injury to the domestic industry. When all
of the facts come to light we are confident that we will prevail
with respect to all countries and exporters in the final
A final ruling by the Department of Commerce is expected "on
or about" July 8, it said in the statement. The U.S.
International Trade Commission (ITC) is then expected to give a
final decision on Aug. 21.
Under the U.S. system the Department of Commerce
investigates charges of unfair trade to determines whether
duties are appropriate and at what level, but the ITC has the
final word on whether duties are imposed.
(Additional reporting by Allison Martell, Stephen Eisenhammer,
Josephine Mason, Blaise Robinson and Raoul Sachs; Editing by
Andrew Callus and Tom Heneghan)