Bridges Weekly Trade News Digest • Volume 14 • Number 8 • 3rd March 2010

US Imposes Duties on Chinese Steel Pipes

Discuss this articleShare your views with other visitors, and read what they have to say

The United States has announced new countervailing duties of between 11 and 13 percent on imports of Chinese steel pipes in the most recent episode in an ongoing trade feud between the two countries.

The 24 February announcement from the US Department of Commerce came in response to a petition requesting countervailing duties filed last October by US Steel and several other companies as well as the United Steelworkers union. They claimed the American steel industry had been significantly harmed by subsidies that China provides to its domestic manufacturers of certain steel pipes.

The petitioners were specifically concerned about imports of seamless carbon and alloy pipe with a diameter of 41 centimetres (16 inches) or less; such pipes are typically used in industrial piping systems. The US imported US$ 130 million of the pipe from China in 2007, but the amount nearly tripled to US$ 382 million in 2008.

The group of petitioners is also pushing the White House to impose additional anti-dumping tariffs on the same pipe of at least 60 percent. A decision on that request is expected in April.

Although the petitioners had been hoping for subsidy duties on Chinese steel pipe of 15 to 30 percent, Roger Schagrin, one of the group’s attorneys, said they were “still happy” with the duties announced last Wednesday because “they’re in the double digits.”

Beijing harshly criticised the tariff announcement the following day. “This is the United States abusing its own trade relief measures,” said Yao Jian, spokesman for China’s Ministry of Commerce.

As of time of writing, China had not launched a WTO dispute over the tariffs; however, such a move is widely expected. The US and China have been trading blows in a series of trade disputes over governmental subsidies, tariffs, and reputed dumping over recent months.

The disputes include Chinese anti-dumping duties on US poultry products, US anti-dumping duties on Chinese-made oil pipes, and US safeguard tariffs on Chinese tyre imports, among other issues. The multitude of trade disputes has heightened political tensions between the two major trading partners.

On 25 February, the day after the Commerce Department’s announcement, a bipartisan group of 15 US senators sent a letter to Commerce Secretary Gary Locke urging the Obama administration to investigate the Chinese government for effectively subsidising exports by its undervaluation of the yuan against the US dollar.

“China’s mercantilist policies are undermining the health of many US industries,” wrote the senators. “In the face of China’s actions to subsidise its exports at the expense of US manufacturers and workers, the Department [of Commerce] needs to act.”

“The bedrock of our international economic system is fairness and a level playing field, and China’s currency practices violate that principle six ways from Sunday,” said Senator Charles Schumer (D-NY), one of the signatories.

In light of the growing friction between Washington and Beijing, two senior US officials - Deputy Secretary of State James Steinberg and senior director for Asian affairs at the National Security Council Jeffrey Bader - went to Beijing on Tuesday to smooth over US-China political and economic relations.

“We’ve gone through a bit of a bumpy patch here,” said a State Department spokesman. “I think there’s an interest both within the US and China to get back to business as usual as quickly as possible.”

ICTSD reporting; “US Imposes Preliminary Duties on Chinese Steel Pipe,” BUSINESS WEEK, 24 February 2010; “US slaps duties on steel pipe from China,” REUTERS, 24 February 2010; “China says US abuses trade measures in steel case,” REUTERS, 25 February 2010; “American Envoys in Beijing to Mend Relations,” NEW YORK TIMES, 2 March 2010.