NEW YORK The
U.S. large-diameter line pipe market remains tepid, with
capacity utilization below 50 percent and producers recording
losses, according to counsel representing the domestic industry
in a sunset review of anti-dumping duties on imports from
"(The industry) has
massive excess capacity; its capacity utilization rates are
well below 50 percent," counsel from Washington law firm
Schagrin Associates wrote in a pre-hearing brief to the
International Trade Commission on behalf of American Cast Iron
Pipe Co., Birmingham, Ala.; Berg Steel Pipe Corp., Panama City,
Fla.; Dura-Bond Pipe LLC, Export, Pa.; Stupp Corp., Baton
Rouge, La.; and Houston-based Welspun Tubular USA LLC.
At the same time,
demand has been crimped by stalled approvals for proposed
pipelines such as the Keystone XL due to regulatory concerns,
while low natural gas prices have meant that others, like the
Alaskan North Slope project, have been put on hold
indefinitely, according to the filing.
Rail cars also have
increasingly taken the place of pipelines in transporting crude
oil, "an alternative that is in some ways more flexible and
attractive than capital-intensive dedicated pipeline
construction," lawyers wrote in the filing.
As a result,
profitability also has been crimped. "Profits and return on
investment have been falling for years, and in the first
quarter of 2013 the industry began losing money. Inventory
levels are high and prices are low," the lawyers wrote.
Some mills would face
closure if the anti-dumping duties are revoked and exports
start flooding the market, according to the filing. U.S.
industry maintains that the duties also should be kept in place
because Japanese producers have "enormous"
excess capacity as a result of Chinese
manufacturers taking market share, according to the filing.