Articles in Category: Anti-Dumping

The backdrop for presumptive republican presidential nominee Donald Trump might have said more than the bombastic businessman and reality show host yesterday. Trump gave a speech at the Monessen, Pa., plant of Alumisource, a company that provides shredded aluminum products and fines used in the production of deoxidation, desulphurization and artificial slag conditioners to the steel industry.

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Talking about trade with piles of shredded scrap and fines surrounding him, Trump called the North American Free Trade Agreement a “disaster” and said he would renegotiate it to get a better deal “by a lot, not just a little,” for American workers. He also threatened to withdraw the U.S. from the deal if his proposals aren’t agreed to.

Scrap processing line? Or Campaign backdrop? Source: Alumisource.

Aluminum scrap processing line? Or Campaign backdrop? Source: Alumisource.

Trump’s rhetoric was welcomed by a mostly receptive audience in the Rust Belt city of 7,500. As a native Western Pennsylvanian, it’s understandable, to me, that both Monessen and Alumisource could accurately portray the image of a “manufacturing city” that the campaign is trying to convey and whose voters it’s trying to reach.

Trade War Rhetoric

“We already have a trade war,” Trump said. “And we’re losing badly.”

Trump then pivoted to dealing with China and other countries that manipulate their currencies to increase exports and said he would use “every tool under American and international law to end these abuses”.

He painted democratic presumptive nominee Hillary Clinton as a NAFTA supporter, a globalist and an agent of the status quo. There will no doubt be a rhetorical back-and-forth between Trump and the Clinton campaign. Western Pennsylvania is still strong union country and most are supporting Clinton, including the United Steelworkers. Yet the fact that companies such as Alumisource are now being sought out as campaign stops shows how much more important American manufacturing is seen to be, as an issue, this election cycle than it has been since at least 2000. Read more

The European Union is to meet this week — all 27 of them without their 28th member, the rebellious U.K. — to discuss the implications of its voters’ momentous decision to leave the political and economic pact in a national referendum last week.

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Most say the decision to leave will hurt the U.K. economy. The Bank of England said before the vote the economic hit on the country will be considerable, with permanent loss of economic growth, higher unemployment and lower tax receipts.

Banks Gird for Policy Battle

The New York Times quoted sources that said British economic growth could be zero or negative in the short and medium term, with a secondary impact over time as London’s financial services sector, which makes up about 12% of the economy — which is more than manufacturing — begins to move staff members and headquarters to Frankfurt, Paris or Dublin.

The web of international banking could be disrupted if there are tighter restrictions on U.K. labor. Image: Adobe Stock/Sergey Givens.

The web of international banking could be disrupted if there are tighter restrictions on U.K. labor. Image: Adobe Stock/Sergey Givens.

London’s banks have lost no time in applying for banking licenses in the above cities and identifying staff they could move to overseas branches if negotiations do not look like they will guarantee continued open access. Read more

Last week, the U.S. International Trade Administration rescinded the Department of Commerce’s request to 124 Chinese aluminum extruders to participate in the 2014 administrative review of anti-dumping and countervailing duties previously levied against them.

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One of those companies was China Zhongwang Group, the world’s second-largest producer of aluminum extrusions. Last year, Zhongwang was accused of evading U.S. import duties by shipping extruded aluminum products — including pallets and 5050 alloy extrusions — into the country without paying the duties.

“Mounting evidence from private investigators, testimony from former employees, data from online import and export databases, and anecdotal evidence from a variety of reporters and other sources made it clear that ZW has consistently and systematically been exporting aluminum extrusions that are simply welded together into what are essentially aluminum slabs,” U.S. industry group the Aluminum Extruders Council wrote in a statement at the time.

“While they claim these so-called ‘deep-processed’ extrusions are aluminum pallets, there is no evidence that Zhongwang or any of its U.S.-based operations market such a product. It is simply incomprehensible that a company would export hundreds of millions of pounds of these extrusions into the U.S. without even marketing them,” the statement continued.

The Aluminum Extruders’ Council stressed that the administrative review has no bearing on the ongoing Zhongwang scope and circumvention cases. Commerce sends notices and requests to Chinese extruders inviting them to participate in that year’s administrative review every year. Zhongwang’s invitation was simply rescinded with all of the others as a matter of protocol.

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However, Commerce did announce its preliminary rates for the administrative review. The countervailing duty rates for aluminum extrusions are staying at 20% and the anti-dumping duty rates have been maintained at 86% for 2017. These are preliminary decisions and Commerce will announce final determinations in December.

Vietnam and Thailand placed tariffs on Chinese steel exports. China’s Southeast Asian neighbors are joining an international effort to limit its massive steel industry’s influence on world prices led by Europe and the U.S.

Low oil prices forced OPEC’s accounts to dip into deficit for the first time since 1998.

China’s Neighbors Are Sick of Steel Dumping, Too

Countries such as Vietnam, Indonesia and Thailand are challenging a flood of imports from China. They are retooling their steelmaking technology and imposing tariffs as a construction boom spurs steel demand across Southeast Asia

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Steel from China is expected to dominate the market for many years, but swelling demand is driving efforts in countries such as Vietnam and Indonesia to build more modern plants, impose tariffs and better compete with China’s vast mills.

Vietnam imposed temporary anti-dumping tariffs ranging from 14% to 23% on steel imports from China and elsewhere in March. It recently slapped additional import duties of up to 25% on more Chinese steel products that will last until October 2019.

Thailand’s commerce ministry is working on the final draft of an anti-dumping law. The government there expects to propose the draft for approval by end-2016, according to a spokeswoman.

OPEC Accounts Fall into Deficit, First Time Since 1998

OPEC’s 2015 oil export revenues slumped 46% to a 10-year low, the group said in a report published on Wednesday, underlining the impact on producers’ income from a collapse in prices.

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Oil prices are at about $50 a barrel, half their mid-2014 level after being pressured by oversupply. OPEC’s decision in November 2014 to not cut supply, hoping a drop in prices would curb supply from competitors, deepened that decline.

The fallout from the U.K.’s vote to leave the European Union is still being felt as lawyers and politicians begin to try to untangle the regulatory mess the eventual move will make and steel imports into the U.S. are up.

Brexit Creates Legal Chaos

Lawyers and lawmakers braced on Friday for uncertainty following the U.K.’s vote to exit the European Union, leaving London to redefine and rewrite its trade and legal ties with the EU, with the U.S. and the rest of the world.

Steel Imports Up in May

Based on preliminary Census Bureau data, the American Iron and Steel Institute (AISI) reported that the U.S. imported a total of 2,786,000 net tons of steel in May 2016, including 2,077,000 nt of finished steel (up 12.2% and 1.8%, respectively, vs. April final data).

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On the year-to-date through five months of 2016 total and finished steel imports are 12,795,000 and 10,544,000 nt, both down 31% vs. the same period in 2015.

Annualized total and finished steel imports in 2016 are 30.7 and 25.3 million nt, down 21% and 20% respectively vs. 2015. Finished steel import market share was an estimated 23% in May and is estimated at 24% on the year-to-date.

The Commerce Department has placed preliminary countervailing duties on imports of biaxial integral geogrid products from China. Geogrids are used in road construction for ground stabilization but also in buildings foundations for the same reason.

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They usually consist of a grid made from an extruded polymer, usually polypropylene or high density polyethylene that’s filled with aggregate to stabilize a road or foundation surface. Commerce preliminarily determined that many producers/exporters in China received countervailable subsidies ranging from 16.60% to a huge 128.27%.

Tensar_biaxial_550_062016

Biaxial geogrid product being used in road construction. Credit: Tensar.

This is the second-time this year that geogrids from China have been tariffed. Georgia-based Tensar International Corp. filed petitions last year over imports of Chinese biaxial integral geogrid products, asserting that the Chinese grids are receiving illegal government subsidies and being unfairly dumped on the U.S. market. The ITC made a preliminary injury finding in January that marked the clearance of the first procedural hurdle in the case. Now that both the ITC and Commerce have made affirmative initial dumping rulings, final determinations should be expected soon.

How to Protect Intellectual Property?

Although geogrid products are a relatively obscure construction input, the financial stakes of the case are considerable, as Commerce has said that U.S. imports of Chinese biaxial integral geogrid products tallied $1.5 billion in 2014. It’s an example of the difficulty U.S. manufacturers face, including those of metals, in developing products —Tensar invented the biaxial geogrid that’s now been used in millions of construction projects worldwide — and then defending their products from mass production by Chinese producers.

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“The volume, price effect and impact of the subject imports have been both significant and harmful,” Tensar said in its filing. “Accordingly, the commission should find that subject imports have caused material injury to the domestic industry.”

Recently, the Department of Commerce announced affirmative preliminary determinations in the anti-dumping duty investigations of imports of circular welded carbon-quality steel pipe from Oman, Pakistan, United Arab Emirates, and Vietnam.

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Pakistan got hit with 11.8% initial anti-dumping duties, Oman’s Al Jazeera Steel Products (and all other producers) received 7.86% duties from U.S. Customs and Border Protection when attempting to import its products, producers in the UAE received dumping rates from 6.10% to 9.25%, Pakistan was judged to deserve dumping margins of 11.8% and Vietnam received a whopping nationwide dumping rate of 113.18%.

drillpipe stacked near rig

Why is Al Jazeera Steel fighting dumping margins of just 11.8%? Source: Adobe Stock

This isn’t the first time circular welded carbon-quality steel pipe has come up in the dumping wars. It’s not even Pakistan’s first turn at the welded carbon steel pipe dumping merry go round. Read more

This week, the Car Wars got hot again as General Motors, on behalf of its Chevy Silverado truck line, started running ads about how weak the rival Ford F-150’s aluminum bed really is.

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GM literally poked holes into the idea that aluminum could be a strong as steel.  They even had Howie Long rub it in.

GM-youtube_Ford_F150_550_060716

The advantage Ford holds, and the reason the automaker pursued aluminum for truck beds in the first place, is that their F-150 is still much lighter and conforms more easily to federal corporate average fuel economy (CAFE) standards. Perhaps Ford should break out the scales and do a fuel economy comparison to strike back at GM? Or should it just keep repeating “military grade aluminum?”

While the automakers were duking it out about who’s truck is tougher, actual steelmakers turned their attention to Beijing where the U.S.-China Strategic and Economic Dialogue took place. U.S. Treasury Secretary Jack Lew called on China to, again, cut excess steel production capacity. China said they would. Again.

The steelmakers gave that a hearty “put or show up.” Well, the American Iron and Steel Institute used more words but that was, essentially, the gist. Our own Stuart Burns also noted that steel is just one of many things that China overproduces and there really might not be much that Beijing can actually do to rein in the wealth of tiny producers of steel and refiners of diesel fuel in its far-flung provinces.

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So, trade wars, car wars and tariffs. Just another week in steel.

Steel, aluminum, cement, what will China flood the world with next?

Free Download: The May 2016 MMI Report

Oh yes, refined petroleum products, or to be more exact diesel fuel is the prime culprit at the moment. According to the Financial Times, China has in the region of 100 million metric tons of excess refining capacity and is adding more. Read more

The American Iron and Steel Institute recently reacted to the conclusion of discussions of the Economic Track of the U.S.-China Strategic and Economic Dialogue, specifically about how the discussions pertain to China and the international steel overcapacity problem.

Free Download: The May 2016 MMI Report

AISI and its member domestic steel producers were not impressed by a commitment by China’s central government to curb steel overcapacity, a promise made to Treasury Secretary Jack Lew at the talks.

“We appreciate the continued efforts of our government to engage China at the highest levels on the steel overcapacity issue and welcome the new commitments by Chinese leaders to adopt measures to strictly contain steel capacity expansion, reduce net steel capacity, eliminate outdated steel capacity, and dispose of ‘zombie enterprises’ through restructuring, bankruptcy and liquidation, as appropriate,” Thomas J. Gibson, AISI president and CEO, said.

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Gibson continued, “China’s participation in further efforts to address global excess capacity at the Organization for Economic Cooperation and Development Steel Committee is also positive. But these commitments will only be meaningful if they lead to real results that produce a significant net reduction in excess steel capacity in China. We appreciate Secretary Lew’s commitment to keep the pressure on to ensure that progress is made in addressing this crisis.”