NEW YORK The U.S. Department of Commerce officially launched an investigation to determine preliminary dumping margins against rebar imports from Mexico and Turkey and countervailing duty investigations against Turkey Sept. 25.
U.S. rebar producers filed the long-anticipated trade complaint with Commerce and the U.S. International Trade Commission (ITC) earlier this month (amm.com, Sept. 4).
Meanwhile, in a separate but related phase of the process, representatives for Turkey and Mexico and domestic rebar producers presented their arguments before the ITC, which will decide in October whether Commerces investigation moves forward.
U.S. producers argued that they are being injured by cheap imports from Turkey and Mexico.
"Its untenable for us to continue to operate as a sustainable business without getting some kind of relief from these subsidized products (from Turkey and Mexico)," Jim Kerkvliet, vice president of commercial sales for Tampa, Fla.-based Gerdau Long Steel North America, told a panel of ITC staff at the conference. "As subject imports continue to pound the market, Gerdaus rebar operations have suffered. Weve been forced to operate our facilities at far below capacity."
"The domestic steel industry is currently being hammered by dumped and subsidized imports from Turkey and Mexico," said James Darsey, executive vice president of Nucor Corp., Charlotte, N.C. "These imports have surged into the U.S. market, doubling from 2010 to 2012 and taking significant market share from the U.S. industry. Mexican and Turkish rebar imports have continued to flow into the U.S. market in 2013, inflicting more damage on Nucor and other U.S. rebar producers."
Executives from rebar mills Commercial Metals Co., Irving, Texas, and Cincinnati-based Byer Steel Corp., as well as rebar distributors and fabricators, made a similar case at the ITCs headquarters in Washington.
The ITC is in the preliminary phase of its investigation. If the ITC finds the U.S. industry has been injured as the domestic mills argue, Commerce will continue the investigation to determine Turkish and Mexican dumping margins.
Counsel for Turkish and Mexican producers, as well as several executives from Mexicos Deacero SA de CV, said at the hearing that they are not dumping rebar into the United States, pointing out that the U.S. industry is largely unaffected by imports.
"U.S. producers are heavily insulated from competition due to a confluence of factors," said David Bond, counsel for Deacero. "U.S. producers market share was about 90 percent on average from 2010 to 2012. One must wonder, what market share will the U.S. industry be satisfied with?"
U.S. mills are also largely protected from imports because they sell much of their rebar to their own downstream rebar fabrication businesses, which serve as reliable business for the mills, foreign producers argued.
They also said that most Mexican and Turkish rebar shipments enter the United States in 20-foot lengths, a market that is not coveted by U.S. mills, and that much of the U.S. market is protected by Buy America laws, which require contractors to use domestic steel in certain publicly funded projects.
"The big three control a significant portion of the fabrication market and ensure that their mills have a steady, long-term book of orders," said Deacero rebar product manager Miguel Bazan. "They naturally prefer their own fabricators in terms of sourcing and pricing."
From 2010 to 2012, the period under investigation, U.S. mills saw increased sales and increased profits, foreign producers said.