NEW YORK The domestic grain-oriented electrical steel (GOES) industry praised the affirmative final ruling in an anti-dumping investigation of imports from three countries, but analysts warned that shifting end markets and continuing import penetration have dimmed the long-term outlook.
The Commerce Departments International Trade Administration this past week imposed final dumping margins ranging from 78.1 to 241.91 percent on GOES shipments from Germany, Japan and Poland (amm.com, July 17), unchanged from preliminary determinations in May. Commerces final rulings on GOES imports from China, the Czech Republic, Russia and South Korea are expected in September.
"This is a key step forward in this important case," said David A. Hartquist, a partner at Washington-based law firm Kelley Drye & Warren LLP and counsel to petitioners AK Steel Corp., Allegheny Technologies Inc. (ATI) and the United Steelworkers union. Commerces dumping margins against Germany, Japan and Poland "are locked in, and importers of GOES must continue paying the U.S. government cash deposits equal to the anti-dumping margins on imports into the U.S.," he said in a statement July 17.
The petitioners now turn to the U.S. International Trade Commission (ITC), which has scheduled a hearing July 24 to determine whether the imports have caused injury to U.S. producers, Hartquist said. The ITCs final determination on imports from Germany, Japan and Poland is due by Aug. 30.
However, enthusiasm within the domestic GOES industry may be tempered by speculation that foreign producers are already plotting ways around the duties. Commerces ruling against Germanys ThyssenKrupp Electrical Steel GmbH, in particular, may be in vain as the company is "planning on ramping up production" at its electrical steel manufacturing facility in France to avoid the duties imposed on German material, Ben Ehmcke, president of Statham, Ga.-based Ehmcke Consulting LLC, told AMM
"They are planning on shipping electrical steel into the U.S. from a country thats not named in the petitions," Ehmcke said, estimating the French mills capacity "in the 50,000- to 60,000-ton (per year) range."
A ThyssenKrupp spokesman said he was "not familiar" with any plans by the company to expand GOES production in France.
Commerce leveled a dumping margin of 241.91 percent on ThyssenKrupp, the highest margin imposed on any producer in the three countries in tnhis past weeks ruling.
The domestic GOES industry also is facing key end-market shifts, with transformer producers continuing to outsource GOES-based core manufacturing abroad. The imported core market in the United States has doubled since the original trade petitions were filed in September, Ehmcke said, adding that hes had discussions with several coremaking equipment manufacturers that have received orders for coremaking equipment to be shipped to facilities in Mexico.
"Japan is very much involved in the shipment of material to Mexico," Ehmcke said, noting that Japanese GOES manufacturers are "already shipping quantities into Canada for use by Canadian core manufacturers."
West Chester, Ohio-based AK Steel and Pittsburgh-based ATI accounted for all domestic GOES production in 2013. The two steelmakers joined the USW in filing trade petitions against GOES imports with Commerce and the ITC in September (amm.com, Sept. 18).