NEW YORK While the United
States and Russia have largely agreed on a tentative deal
concerning the existing suspension agreement on hot-rolled
steel, domestic producers argue that it still stands to favor
Under the new draft agreement
reached earlier this month, minimum prices for Russian steel
sold into the United States would be increased to "bring them
into alignment with current U.S. prices," which would
effectively raise prices by some 47 percent (
amm.com, Nov. 16).
Domestic interests, however,
argue that while the revised agreement is an improvement, they
have issues with the pact.
"The modified agreement would
continue to allow Russian producers to sell under a reference
price mechanism, an alternative generally available only to
non-market-economy countries, even though the (Commerce)
department has treated Russia as a market-economy country since
2002," petitioners ArcelorMittal USA LLC, Gallatin Steel Co.,
Nucor Corp., SSAB Americas, Steel Dynamics Inc. and U.S. Steel
Corp. said in comments submitted to Commerce. "In light of
these benefits, the department should treat with caution any
future claims by the Russian government that the modified
agreement is keeping Russian exports out of the U.S. market."
The petitioners added that there is "no requirement" that a
suspension agreement guarantee foreign producers a share of the
A number of market participants
told AMM last week that as a result of the revised
prices, imports of the Russian product likely would drop off
amm.com, Nov. 19).
Meanwhile, OAO Severstal,
Novolipetsk Steel, Magnitogorsk Iron & Steel Works and OJSC
OMK-Steel complained that the steel benchmark used in the
agreement is still inadequate as a basis for pricesan
argument first introduced during the preliminary comment period
amm.com, Aug. 13).
"Russian producers continue to
question the use of SteelBenchmarker either for purposes of
determining whether the current agreement is allowing price
suppression or as a basis for resetting the agreement," the
foreign interests said in their comments. "While accepting it
for purposes of resetting the reference price in the revised
agreement ... the Russian producers are hopeful that a
benchmark that actually corresponds to the level of trade and
selling conditions of the Russian producers is used."
Final revisions are set to be
signed by both governments Friday.