Secretary Wilbur Ross released reports on the U.S.
Department of Commerce’s investigations into the impact on our national
security from imports of steel mill products and from imports of wrought
and unwrought aluminum. These investigations were carried out under
Section 232 of the Trade Expansion Act of 1962, as amended. All classified
and business confidential information in the reports was redacted before
the release.
“I am glad that we were able to provide this
analysis and these recommendations to the President,” said Secretary
Ross. “I look forward to his decision on any potential course of
action.”
The Department of Commerce found that the
quantities and circumstances of steel and aluminum imports “threaten to
impair the national security,” as defined by Section 232.
The reports are currently under consideration by
the President, and no final decisions have been made with regard to their
contents. The President may take a range of actions, or no action, based
on the analysis and recommendations provided in the reports. Action could
include making modifications to the courses of action proposed, such as
adjusting percentages.
The President is required to make a decision on the
steel recommendations by April 11, 2018, and on the aluminum
recommendations by April 19, 2018.
Key Findings of the Steel Report:
·
The United States is the world’s largest importer of steel. Our imports
are nearly four times our exports.
·
Six basic oxygen furnaces and four electric furnaces have closed since 2000
and employment has dropped by 35% since 1998.
·
World steelmaking capacity is 2.4 billion metric tons, up 127% from 2000,
while steel demand grew at a slower rate.
·
The recent global excess capacity is 700 million tons, almost 7 times the
annual total of U.S. steel consumption. China is by far the largest
producer and exporter of steel, and the largest source of excess steel
capacity. Their excess capacity alone exceeds the total U.S. steel-making
capacity.
·
On an average month, China produces nearly as much steel as the U.S. does
in a year. For certain types of steel, such as for electrical
transformers, only one U.S. producer remains.
·
As of February 15, 2018, the U.S. had 169 antidumping and countervailing
duty orders in place on steel, of which 29 are against China, and there
are 25 ongoing investigations.
Recommendations of the Steel Report:
Secretary Ross has recommended to the President
that he consider the following alternative remedies to address the problem
of steel imports:
1.
A global tariff of at least 24% on all steel
imports from all countries, or
2.
A tariff of at least 53% on all steel imports from
12 countries (Brazil, China, Costa Rica, Egypt, India, Malaysia, Republic
of Korea, Russia, South Africa, Thailand, Turkey and Vietnam) with a quota
by product on steel imports from all other countries equal to 100% of
their 2017 exports to the United States, or
3.
A quota on all steel products from all countries
equal to 63% of each country’s 2017 exports to the United States.
Each of these remedies is intended to increase
domestic steel production from its present 73% of capacity to
approximately an 80% operating rate, the minimum rate needed for the
long-term viability of the industry. Each remedy applies measures to all
countries and all steel products to prevent circumvention.
The tariffs and quotas would be in addition to any
duties already in place. The report recommends that a process be put in
place to allow the Secretary to grant requests from U.S. companies to
exclude specific products if the U.S. lacks sufficient domestic capacity
or for national security considerations. Any exclusions granted could
result in changed tariffs or quotas for the remaining products to maintain
the overall effect.
source:
www.commerce.gov
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