U.S. Steel Industry Group Provides Comments on China's Trade Barriers
12/01/2014 - The American Iron and Steel Institute (AISI) is urging the U.S.’s highest ranking trade officials to bring up the critical steel issues of China’s currency manipulation, overcapacity and non-market economy status when they meet with Chinese officials at the U.S.-China Joint Commission on Commerce and Trade (JCCT) on16–18 December in Chicago.
In an emphatic letter to Secretary of Commerce Penny Pritzker and U.S. Trade Representative (USTR) Mike Froman, who are co-chairing the meeting, AISI president and CEO Thomas J. Gibson said that while “the full range of Chinese barriers to trade and trade-distorting practices are too numerous to list, we ask these priority areas of concern to the U.S. steel industry be addressed.”
Gibson said that finished steel imports’ market share is estimated at 27% year to date, compared to 23% in 2013, and that finished steel imports from China have increased 70% through September 2014 compared to the same period last year. He said overcapacity in the Chinese steel industry and the fact that most of the Chinese industry is state owned or subsidized threatens even more injury to the North American steel industry, noting that more than 95% of the production of the top 20 steel groups in China is state-owned.
“One of the primary drivers of this surge in steel imports into the United States is the global overcapacity in steelmaking. China has enough excess steel capacity (361 million net tons) to produce annually almost four times as much steel as the entire U.S. industry produces,” said Gibson. “Direct government intervention in steel markets by China, and other countries following its example, is at the heart of the overcapacity problem plaguing the global steel industry and is a critical matter we believe the U.S. government should address with the Chinese government during the upcoming JCCT meetings.”
In addition, Gibson said the U.S. government has long sought to address concerns about currency manipulation through dialogue with the Chinese government, “but these discussions have yet to translate into acceptable results.” Gibson urged that Pritzker and Froman “consider new ways in which the Administration can take meaningful action to address this issue.”
Gibson also expressed concern that China is asking to be treated as a market economy under the U.S. antidumping law despite the fact that the Chinese economy continues to be under significant state control. He urged that these issues be primary topics at the meetings and that the U.S. government “vigorously defend the U.S. right” to continue to treat China as an NME.
Gibson said that finished steel imports’ market share is estimated at 27% year to date, compared to 23% in 2013, and that finished steel imports from China have increased 70% through September 2014 compared to the same period last year. He said overcapacity in the Chinese steel industry and the fact that most of the Chinese industry is state owned or subsidized threatens even more injury to the North American steel industry, noting that more than 95% of the production of the top 20 steel groups in China is state-owned.
“One of the primary drivers of this surge in steel imports into the United States is the global overcapacity in steelmaking. China has enough excess steel capacity (361 million net tons) to produce annually almost four times as much steel as the entire U.S. industry produces,” said Gibson. “Direct government intervention in steel markets by China, and other countries following its example, is at the heart of the overcapacity problem plaguing the global steel industry and is a critical matter we believe the U.S. government should address with the Chinese government during the upcoming JCCT meetings.”
In addition, Gibson said the U.S. government has long sought to address concerns about currency manipulation through dialogue with the Chinese government, “but these discussions have yet to translate into acceptable results.” Gibson urged that Pritzker and Froman “consider new ways in which the Administration can take meaningful action to address this issue.”
Gibson also expressed concern that China is asking to be treated as a market economy under the U.S. antidumping law despite the fact that the Chinese economy continues to be under significant state control. He urged that these issues be primary topics at the meetings and that the U.S. government “vigorously defend the U.S. right” to continue to treat China as an NME.
