Steel Consumers Challenge Pro-Tariff Companies

By Tonya Vinas Two months from the first-year anniversary of the Bush Administration's imposition of steep steel tariffs, debate over those tariffs continues to rage among manufacturers. Most recently, a group representing steel-consuming companies is trying to block an effort to extend the tariffs, known as Section 201 tariffs, to 30 now-exempt developing countries plus Mexico. This week the Consuming Industries Trade Action Coalition Steel Task Force sent a letter to U.S. Trade Representative Robert Zoellick and Commerce Secretary Donald Evans urging them to reject a request by a group of steel-producing companies to extend the tariffs to the 31 countries. That request was sent earlier this month to Zoellick and Evans by Weirton Steel Corp., Nucor Corp., Gallatin Steel Co., IPSCO Steel Inc., Steel Dynamics Inc., WCI Steel Inc. and Rouge Steel Co. The exempt countries are benefiting from the tariffs while hurting U.S. steel companies, the steel producers say. According to the pro-tariff coalition, the 30 developing countries imported 1.2 million tons of steel into the United States in 2001. Through October 2002, the most recent data available, imports from these countries jumped to 1.6 million tons. Mexico's imports also increased. However, the steel-consuming task force says that those numbers are inflated because they don't include slab (semifinished) products. "In their letter, U.S. producers also blame developing country imports for falling prices in recent months and reduced capacity utilization, ignoring the fact that several dormant domestic steel mills have been restarted since the 201 tariffs, adding 8.5 million tons of steel production to the U.S. market," says William Gaskin, president of the Precision Metalforming Association and a member of the consuming-industries' task force. Many steel-consuming manufacturers have lost considerable business to foreign competitors that have access to lower-priced steel available in the international market, according to the anti-tariff group.

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