Economy

US slaps punitive penalties on Chinese steel pipes

(Xinhua)
Updated: 2010-04-10 14:33

WASHINGTON - The United States on Friday imposed anti-dumping duties ranging from 30 percent to 99 percent on imports of steel pipes used in oil and gas wells, a move that might escalate trade disputes between the two countries.

The Commerce Department said in a statement that prices for the Chinese pipes, or "oil country tubular goods (OCTG)," are 29.94 percent to 99.14 percent lower than fair value when it is sold in the US market.

According to the department, 37 Chinese firms will receive a final dumping rate of 29.94 percent, and all other Chinese exporters are subject to the final dumping rate of 99.14 percent.

However, the US International Trade Commission (ITC), an independent federal agency, could still cancel the anti-dumping duties if its members find in a vote that US domestic steel producers suffer no harm from the imported Chinese products, which were worth $1.1 billion in 2009.

The ITC is scheduled to issue its final injury determination on or before May 24.

In November 2009, the Commerce Department also set final countervailable duties (CVD) ranging from 10.36 percent to 15.78 percent on Chinese-made OCTG.

One month later, an ITC ruling paved the way for the imposition of duties.

The anti-dumping and countervailing petition case was filed in last April.

The case was boosted by the United Steel Union, which has served as a driving force in many recent trade actions against China, and other seven US producers: the United States Steel Corp, Maverick Tube Corp, Evraz Rocky Mountain Steel, TMK IPSCO, V &M Star LLP, V&M TCA and Wheatland Tube Corp.

China strongly opposed the US decision, saying it is a protectionist move.

"China expressed strong dissatisfaction and is resolutely opposed to this," Yao Jian, spokesman of China's Ministry of Commerce, said in a statement last year.

"This does not comply with WTO agreements on subsidies. The United States used an incorrect method to define and calculate the subsidies, which has resulted in an artificially high subsidy rate, hurting Chinese firms' interests," Yao said.

"We hope the United States can get rid of the bias and admit China's market economy status soon to tackle the double standards thoroughly and give Chinese enterprises equal and fair treatment," said the spokesman.

The US industries also expressed strong dissatisfaction with the trade case, saying such a protectionist move would hurt US companies.

The trade restrictions would "hurt US using industries by raising their costs and making sources of supply uncertain," Eugene Patrone, executive director of the Consuming Industries Trade Action Coalition told Xinhua.

He said the tariffs would make oil and gas exploration and production more expensive, and projects delayed. The results are against the US national goal of being less dependant on imported energy.

The onset of the global recession appears to have triggered an increase in trade disputes around the world.

Globally, new requests for protection from imports in the first half of 2009 were up 18.5 percent compared with the same period of 2008, according to the World Bank-sponsored Global Anti-dumping Database.

That increase followed a 44-percent increase in new investigations in 2008. And China has become the main target of rising protectionism.