Company News

UPDATE 1-China's export rebates hurt steel industry-US Steel

(Adds details, quotes)

NEW YORK, June 23 (Reuters) - China's move to cut export taxes for its steelmakers will increase its steel exports at the expense of other producers around the world, undermining the industry, said U.S. Steel X.N Chairman and Chief Executive Officer John Surma.

Speaking at a steel conference organized by American Metal Market on Tuesday, Surma called on China to comply with World Trade Organization rules.

“We believe China must comply with WTO rules. We believe subsidization seriously undermines the global steel industry,” Surma said, adding that recent Chinese export rebates would increase Chinese steel exports.

On Monday, China’s Ministry of Finance said it would cut taxes on some exported steel products by 5 percent to 10 percent starting July 1, to help domestic producers ease their excess supply.

Later, on the sidelines of the conference, Surma said the largest U.S. steelmaker was considering ramping up production since they have seen a slight pick up in orders.

“We have seen some modest improvements and higher order rates,” he said.

Surma did not give an exact time frame or details of an increase in production, but indicated the possible restart of a blast furnace in Granite City, Illinois.

The global economic downturn has forced most steel makers to reduce production in the face of slumping demand.

U.S. Steel’s stock was up 2.23 percent at $34.88 in afternoon trading on the New York Stock Exchange. (Reporting by Steve James and Humeyra Pamuk; Writing by Carole Vaporean and Marguerita Choy; Editing by Christian Wiessner)