PITTSBURGH The United States must address foreign scrap export restrictions and invest in infrastructure if mini-mills are to remain competitive, industry players said in testimony Friday before the Congressional Steel Caucus.
"Excessive foreign purchases of U.S. scrap are hollowing out our domestic scrap supply, while other countries own scrap export restrictions distort markets and discourage the development of needed recycling networks," Jim Anderson, general manager of Steel Dynamics Inc. (SDI)-owned the Techs, testified during the session on behalf of the Steel Manufacturers Association (SMA).
Anderson told the five lawmakers present at the meeting that they appear to be indifferent to the foreign appetite for U.S.-based scrap.
Ferrous scrap exports totaled nearly 24.3 million tonnes in 2011, according to U.S. Commerce Department data, which represented about one-third of all of the material generated in the country for the year.
While the United States freely sells its scrap offshore, 26 foreign governments have imposed scrap barriers. Russia, the latest country to initiate such action, has now restricted exports through two ports, Anderson noted.
"These measures could deny the U.S. and other World Trade Organization (WTO) members the benefits of commitments that Russia has made in connection with its accession to the WTO," he said at the meeting, arranged by Rep. Tim Murphy (R., Pa.) to hear how policymakers can help support the steel industry.
"Pervasive foreign government controls have distorted world markets for both steel and raw materials that are used in steelmaking. Governments that provide subsidized investment and control the movement of raw materials through trade barriers directly violate WTO agreements," Anderson added.
SDI owns OmniSource Corp., the Fort Wayne, Ind.-based producers scrap arm.
Anderson also recommended that lawmakers step up their investment in infrastructure improvements, which would require the use of steel. He expressed support for a proposed National Infrastructure Bank, an entity that could leverage hundreds of billions of dollars in private capital to make needed investments, calling the concept "an idea whose time has come."