Seven domestic oil country tubular goods (OCTG) producers and the United Steelworkers (USW) have filed an antidumping and countervailing duty trade case against China imports with the U.S. Department of Commerce and the U.S. International Trade Commission.
According to Roger Schagrin, trade counsel for the USW's petition, China imports of OCTG pipe from China are subject to very high antidumping and countervailing duties in Canada, the world's second-largest market.
Schagrin also said the European Union made a preliminary dumping determination this week of margins ranging from 35 to 51% against China imports of seamless pipe.
China exported over 600,000 tons to the E.U. last year. Once the EU’s new margins are in place, China could potentially shift much of that 6000,000 tonnes toward the U.S.
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Petitions filed by the USW and domestic companies allege that Chinese producers benefit from massive government subsidies and dumping margins that range from 40 to 90%.
Petitioners for the case include U.S. Steel Corp., Pittsburgh, Pa.; Maverick Tube Corp., Hickman, Ark.; Evraz Rocky Mountain Steel, Pueblo, Colo.; TMK Ipsco, Downers Grove, Ill.; V&M Star, LLP, Houston, Texas; V&M TCA, Houston, Texas; and Wheatland Tube Corp., Beachwood, Ohio. The USW was also a co-petitioner.
“Dumped and subsidized imports from China have tripled from 750,000 tons in 2006 to 2.2 million tons in 2008 and have continued increasing in the first quarter of this year,” noted Rob Simon, Vice President and General Manager of Evraz Rocky Mountain Steel Mills. “These imports significantly undersold our producers and have created a huge inventory build up in the U.S. market.”
According to the USW, the increase in Chinese imports of OCTG are made worse by the global recession, which further intensifies the impact on jobs in the steel and pipe manufacturing sector.
“There are more than 2000 workers currently on layoff at companies making OCTG,” said USW International President Leo W. Gerard. “We cannot let China get away with targeting these family-supportive and skilled jobs through predatory trade practices. China must be stopped from cheating on trade with illegally dumped and subsidized products that destroy our ability to drill for oil and gas in the U.S.”
Tom Conway, USW International Vice President, who oversees the union's pipe sector, added, "Because of the astonishing volume of unfairly traded drill pipe from China, we have large numbers of laid-off workers at world-class production facilities that need strict enforcement of our trade laws before it’s too late and we lose the capacity to make this critical product."
Under U.S. trade law, the ITC is to make a preliminary injury determination no later than May 26, 2009. The Department of Commerce is expected to issue a preliminary subsidy finding by September 8, 2009, and a preliminary dumping finding by November 6, 2009.
The USW is the largest union representing production workers employed by the petitioner companies that make OCTG. Total OCTG employment is estimated at 6000 workers.
OCTG includes welded and stainless steel pipes that are used to extract oil or gas from a drill well.