U.S SLAPS DUTIES ON BEIJING STEEL PIPE IMPORTS / THE FINANCIAL TIMES ( RECOMMENDED READING )

US slaps duties on Beijing steel pipe imports

By Sarah O’Connor in Washington

Published: November 6 2009 00:17

The US hit China with another big trade action on Thursday as it slapped ­preliminary anti-dumping duties on $2.6bn worth of Chinese pipe imports.

The commerce department’s decision to impose duties of up to 99 per cent on imports of some steel pipes is the latest in a string of trade spats between over tyres, cars and chickens. It comes less than a fortnight before President Barack Obama’s first visit to China.
The ruling will affect more imports by value than Mr Obama’s recent move to impose duties on Chinese tyres, which sparked an international row in which Beijing accused the US of “rampant protectionism”.

The decision was a victory for steel companies, including US Steel Corporation, that petitioned for the duties in April. The United Steelworkers union said the decision was “an overdue message for thousands of American laid-off workers that trade laws are being enforced”. It says nearly half the domestic industry’s workers have been laid off.

“China’s government and exporters are being told we are fed up with their cheating on our fair-trade laws, and penalties for these transgressions are long overdue,” said Leo Gerard, USW president.

Anti-dumping duties are used when companies sell their products unfairly cheaply into foreign markets. Imports of the Chinese pipes, which are used in oil-drilling, surged 203 per cent between 2006 and 2008, according to the commerce department.

The duties range from 36.53 per cent for a select group of Chinese companies to 99.14 per cent for the rest. One manufacturer, Jiangsu Changbao Steel Tube Co, was exempted from the ruling.

It follows commerce deppartment’s decision in September to impose so-called “countervailing duties” on the pipes, which are aimed at offsetting government subsidies.

Although it is only a preliminary ruling, US customs will now start collecting a cash or bond deposits on imports based on the rates set yesterday. A final decision will not be made until March.

In another sign of its muscular approach on trade with China, the US this week asked for a World Trade Organisation disputes panel to investigate Chinese restrictions on exports of specialised raw materials used in industry. It was joined by the European Union and Mexico in claiming that China’s restraints on some raw materials were driving up the cost of end products.

China recently struck back at the US, announcing it would investigate whether Washington was unfairly subsidising its car-makers.

The tit-for-tat takes place against a backdrop of high-level talks between the two countries. They struck a positive tone last week at a trade summit in the Chinese city of Hangzhou, where they resolved some outstanding US complaints over imports of pork and windpower equipment.

Copyright The Financial Times Limited 2009.