US Trade Court Says South Korean OCTG Duties Must Be Recalculated

A court has called for a recalculation of sums underlying duties slapped last year on imports of steel pipes for the energy sector from South Korea, in a setback for domestic producers.

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The US Court of International Trade ruled on September 2 that the Department of Commerce should reconsider its calculation of profit, a key input in determining the level of duties.

The Commerce Department and the US International Trade Commission last year ruled that US-based steel companies, including United States Steel Corp., Maverick Tube Corp., Energex Tube, and the US subsidiaries of Russia’s TMK IPSCO and France’s Vallourec Star, were facing subsidized competition and “dumped” imports of oil country tubular goods. OCTG is a classification of tubes and pipes used mainly in oil and natural gas extraction.

South Korea was the biggest producer of allegedly subsidized OCTG in the case, which also covered imports from India, Taiwan, Turkey, Ukraine and Vietnam.

Commerce set duties on imports from South Korea’s Hyundai Hysco at 15.75%, Nexteel at 9.89% and all other South Korean producers at 12.82%. The companies argued the duties were too high.

“Commerce’s Final Determination is remanded in part … for it to reconsider its calculation,” the Court of International Trade said, although it upheld other parts of the decision.

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Commerce has until Nov. 2 to respond but, if the ruling stands, it’s a victory for the importers and another costly loss for US steel companies in the always expensive anti-dumping process. If the duties on the South Korean producers end up below 8% they likely would not be stiff enough to discourage use by oil and natural gas companies looking to keep their costs down. Many of these products are being sold below cost thanks to subsidies.

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