NEW YORK U.S.
Steel Corp. said it has struggled to make an adequate return on
its $2.1-billion investment in welded oil country tubular goods
(OCTG) producer Lone Star Technologies Inc. in 2007 due to a
rise in unfairly traded imports.
"U.S. Steel properly
saw that demand for these products was growing, and it made a
massive investment to take advantage of that fact," attorneys
at Washington-based law firm Skadden, Arps, Slate, Meagher
& Flom LLP wrote in a post-hearing brief filed with the
International Trade Commission (ITC) in an anti-dumping
and countervailing case against nine OCTG-producing
However, the domestic
market was hit first by an influx of dumped OCTG from China,
and, after the successful filing of a trade case, by another
wave of unfair imports from the nine countries, all of which
increased their exports to the United States by "huge
percentages" during the 2010-12 investigation at "very low
As a result, even as
domestic OCTG consumption is on pace to grow to 6.5 million
tons this year, profit margins for domestic producers have
fallen over the last three years, lawyers for the
Pittsburgh-based steelmaker wrote.
If prices of imports
from the nine countries had been 5 percent higher between 2010
and 2012, domestic revenues would have increased by $793
million to $1.3 billion, Dr. Michael Whinston, professor of
economics and management at the Massachusetts Institute of
Technology, testified during an ITC staff conference July 23,
according to the filing.
"In short, the record
contains overwhelming evidence that during three of the best
years in recent history for OCTG demand, subject imports
deprived U.S. mills of the money that they could have made in a
fair market," the lawyers wrote.