A move by US steel pipe producers to seek duties on imports from China is "irresponsible," an official at the China Iron and Steel Association said on Friday. US steel pipe producers asked the US Commerce Department on Thursday to impose steep duties on competing imports from China, which they said are being sold at unfairly low and subsidised prices.
"The world steel market is so good, why would they sell at lower prices than they need to? Wouldn't they lose money this way?" said Qi Xiangdong, vice secretary general of the association. "If there's a problem, we can discuss through proper channels. But to act this way is very irresponsible and out of order."
Jiang Zengwei, vice minister of commerce, declined to comment on the request on Friday. The case follows a recent US Commerce Department decision that angered Beijing by allowing US companies to seek an additional category of duties against Chinese imports.
In that case, involving coated paper, the Commerce Department reversed a longstanding policy and agreed to impose duties to offset Chinese government subsidies in addition to duties against unfair pricing or dumping. It had previously held that government subsidies have no impact on company pricing decisions in "non-market economies."
Following that precedent, six US producers of welded standard steel pipes and the United States Steelworkers union filed petitions on Thursday asking for anti-dumping duties ranging up to 88 percent and additional unspecified countervailing duties to negate a range of alleged subsidies.
China's crude steel output expanded by 20 percent last year, leading to an increase in exports as the domestic market failed to absorb the excess production. Beijing is encouraging companies to produce more value-added products such as steel pipes.
China has made a series of reductions in tax rebates enjoyed by exporters, and raised taxes on a range of low-end steel products, to reduce profits from exports and curtail excessive growth in the steel industry. But cheap land, credit and labour still keep input costs low for state-owned heavy industries.
US steel pipe producers blame a 6,800 percent increase in imports from China between 2002 and 2006 for the loss of more than 500 jobs and the closing of four US plants.
The US International Trade Commission will make a preliminary determination in July on whether the low-priced imports are harming US producers. A positive decision would set the stage for the Commerce Department to announce preliminary anti-dumping and countervailing duties in the fourth quarter of the year.