April 10, 2009 / 12:36 PM / 10 years ago

UPDATE 1-China to hit back if US launches steel case -paper

* Industry official vows action if U.S. takes up complaint

* Chinese Commerce Ministry says watching steel case

(Adds comments by ministry spokesman)

BEIJING, April 10 (Reuters) - China will hit back if the United States chooses to investigate a complaint that China is dumping steel pipes in the U.S. market, the China Daily quoted a senior industry official as saying on Friday.

Seven U.S. steelmakers have complained to U.S. trade bodies that China has flooded the U.S. market with steel pipes, with exports rising from 900,000 tonnes to 2.2 million tonnes last year, worth an estimated $2.7 billion [ID:nPEK340535]

The official, from the China Chamber of Commerce of Metals, Minerals and Chemicals Importers and Exporters, said China’s steel industry associations would “take up cudgels on behalf of producers” if the U.S. government launched a probe into the case, the newspaper reported.

The official, identified only by the surname Chen, said trading enterprises as well as manufacturers could be affected if the U.S. government imposed punitive duties on certain Chinese steel products.

Commerce Ministry spokesman Yao Jian said later on Friday that Beijing was paying close attention to the case.

The current difficulties of the U.S. steel industry were the result of the slowdown in demand brought about by the financial crisis and should not be blamed on importers, Yao said in a statement on the ministry’s website.

“Looking for trade protection cannot solve the true problems faced by American industry,” Yao said, adding that China hoped the U.S. administration would “resist protectionism and avoid sending the wrong message to the rest of the world”.

The complaint by the U.S. steelmakers and the United Steelworkers union centres on welded and stainless steel pipes known as oil country tubular goods (OCTG), which are used in oil and gas drilling.

The petitioners include U.S. Steel Corp (X.N), Evraz Rocky Mountain Steel Mills HK1q.L and TMK IPSCO (TRMK.MM).

Despite the world economic slowdown, Chinese steelmakers are producing at a faster rate than last year, spurred on by a $585 billion government stimulus plan and hopes of China’s economy picking up speed again in the second half of this year.

The steelmakers’ complaint to the U.S. Department of Commerce and the U.S. International Trade Commission said Chinese producers of OCTG benefited from government subsidies and dumping margins of 40-90 percent, threatening the livelihoods of about 6,000 U.S. OCTG workers.

The U.S. steelmakers’ statement said the U.S. International Trade Commission would make a preliminary injury determination no later than May 26 and the Department of Commerce would issue a preliminary subsidy finding by Sept. 8 and a preliminary dumping finding by Nov. 6.

It also said Chinese OCTG pipe was subject to very high anti-dumping duties in Canada and that the European Union, which imported over 600,000 tonnes in 2008, made a preliminary dumping determination of margins of 35-51 percent on Chinese seamless pipe on Wednesday, which could divert more to the U.S. market. (Reporting by Tom Miles and Jason Subler, editing by Anthony Barker)

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