The top official at Nucor Corporation (NYSE: NUE), which operates two locations in Central New York, is applauding the U.S. International Trade Commission’s (ITC) decision on some foreign imports of steel.
The ITC has voted to place duties on foreign companies that were exporting “unfairly subsidized and artificially cheap” steel to the U.S., products that hurt domestic steelmakers, according to a Friday news release that the office of U.S. Senator Charles Schumer (D–N.Y.) released.
The duties are on corrosion-resistant and cold-rolled steel.
The Democrat’s office called it “unfair trade practices,” noting the ITC vote places New York steelmakers and their workers “on a level playing field.”
“These final determinations by the International Trade Commission confirm that the U.S. steel industry has suffered harmful effects from imports of dumped and subsidized corrosion-resistant steel,” John Ferriola, chairman, president and CEO of Nucor Corporation, said Schumer’s news release. “[The] decision and the [one last] week in two of the cold-rolled steel cases are important steps in returning fair trade to the U.S. flat rolled steel market. Our government is sending a clear message that all countries must play by the rules of international trade and will be held accountable for failure to do so.”
Nucor Corporation is headquartered in Charlotte, North Carolina. The company employs a total of 579 workers in New York, according to Schumer’s office. The locations include Nucor Steel Auburn Inc. in Auburn and Vulcraft of New York Inc. in Chemung, according to the Nucor website.
Nucor’s Auburn facility produces a range of carbon steel products including reinforcing bars and employs more than 310 people, the Democrat’s office said.
The unanimous ruling is “great news” for Nucor and other steelmakers, Schumer said. “We could not afford to let our steel manufacturing base melt away because China refuses to play by the rules,” Schumer said in the news release. “That’s why I went to bat for our New York steel industry and pushed the ITC and the [U.S.] Department of Commerce to implement new duties to guard against this unfair foreign competition.”
Schumer’s argument
A “massive” volume of Chinese steel has entered global markets, including the U.S., “harming” American steel producers and the communities that rely on these manufacturers, like those in Central New York where Nucor has two locations.
Schumer’s office cited the Washington, D.C.–based American Iron and Steel Institute (AISI) as saying steel facilities averaged roughly 70 percent capacity utilization in 2015, which the AISI considers “well below” the levels necessary to generate a profit, invest in plant and equipment, or hire new workers.
Data from the U.S. Bureau of Labor Statistics indicates that employment in the steel industry has declined by more than 12,000 jobs over the last 12 months for which data are available.
In 2015, imports of corrosion-resistant steel from China, India, Italy, Korea, and Taiwan were valued at an estimated $500.3 million, $219.6 million, $110 million, $509.1 million, and $534.4 million, respectively, according to Schumer’s office.
The duties put in place on this steel are as high as 450 percent for China; 34 percent for India; 92 percent for Italy; 47 percent for Korea; and 3.7 percent for Taiwan, it added.
Schumer explained that China’s government, especially, is providing massive subsidies to its steel and aluminum sectors, which are primarily state-owned, in order to export high volumes of steel and aluminum.
These steel and aluminum products are sold at artificially low prices in the U.S. markets and foreign market where U.S. producers export, putting jobs at local companies at risk. In addition, Schumer urged the Office of the United States Trade Representative and the U.S. Department of Commerce to implement and enforce previous laws that he has already supported, like the Level The Playing Field Act, which strengthens Commerce’s ability to defend American workers and producers against predatory trade practices.
Contact Reinhardt at ereinhardt@cnybj.com