The US Commerce Department has denied all 19 of Borusan Mannesmann Pipe US' requests for Section 232 tariff exclusions that the company previously said would enable an expansion of operations at its mill in Baytown, Texas.
The company was seeking exemptions for imports of various sizes of oil country tubular goods from its parent company in Turkey, according to the department's docket.
The Texas facility's finishing capacity exceeds its production capacity, and part of the company's business model has been to import green tube from Turkey in order to provide a full range of size combinations to its US customers. Winning Section 232 exclusions would have helped the mill remain "economically viable" while it invested as much as $75 million toward becoming a fully domestic producer.
Company executives are "reviewing all of our options" after getting the bad news, Borusan Mannesmann Pipe US chief executive officer Joel Johnson said.
“Our company and our dedicated employees are very disappointed that the government did not accept our unique short-term application for a 232 steel tariff exemption in exchange for a significant financial investment and expansion in our Baytown, Texas, facility that would have created about 170 new well-paying jobs in the critical energy sector," Johnson told American Metal Market via email on Tuesday July 10.
The requested quantities in the exemptions would have totaled 65,000 tonnes of tubing and 70,000 tons of casing over a two-year period.
American Metal Market's pricing assessment for US domestic welded high-collapse P110 casing stands at $1,600-1,700 per ton fob mill, up 33.3% from $1,200-1,275 per ton at the start of this year.