A who’s who of the global steel industry spoke Wednesday in Washington, DC, regarding the US’ launch of an investigation into the security needs of the domestic steel industry, Kallanish reports.
The so-called section 232 investigation hearing featured comment from a variety of US steel mill executives – including executives from US Steel, Nucor, ArcelorMittal USA, Steel Dynamics Inc and AK Steel – as well as trade groups and representatives from the governments of China, Russia and the Ukraine.
Two main views emerged from the domestic groups represented at the hearing. Domestic primary steel producers espoused the need for strong protectionist measures to ensure stable steel supply and national security, while domestic steel traders and end-users said distorting US involvement in the global market will limit topline growth and possibly spark retaliatory measures from other countries.
“As one of the most open markets in the world, the United States is often the target of dumping by steel producers from countries around the world. In many cases, these foreign producers are also subsidised by their governments,” says American Iron and Steel Institute (AISI) ceo Thomas Gibson. AISI represents the bulk of domestic primary producers.
“To date, the US steel industry has relied on our trade laws to seek to address the impact of unfairly traded steel imports in our market,” he adds. “While the anti-dumping and countervailing duty laws have provided some relief, because the resulting orders are necessarily country and product specific, they leave openings for steel products not subject to orders to continue to surge into our market.”
Gibson’s testimony was countered by international trade counsel Gary Horlick of the American Institute for International Steel, which represents US importers.
“Finally, it is impossible to ignore the certainty that other countries will retaliate against US exports,” says Horlick in his testimony. “Let’s start with the obvious – the United States is the largest exporter of military equipment in the world, selling over $20 billion annually in recent years. But we have competitors for almost all our products – Russia is second, for example. This affects not only the jobs that are dependent on exports, but the entire economics of our defense base. The economics of great airplanes like the F-35 or the F-22 do not work unless they are sold to some of the same countries whose steel this proceeding might limit from entering the US.”
Horlick also noted that the US is relatively poor in iron ore, and domestic production cannot be indefinitely sustained without resorting to iron ore imports. Pro-actively shutting off steel imports could ultimately hurt national security if retaliatory iron ore export restrictions are eventually imposed by targeted countries.