Allegheny Technologies Inc (ATI) confirmed reports that it expects delivery of a stainless slab shipment from Tsingshan’s factory in Indonesia to its Midland, Pennsylvania, cold-rolled coil mill operated by 50:50 joint venture Allegheny & Tsingshan Stainless (A&T Stainless).
But ATI disputes a claim by North American Stainless Inc (NAS) that this will be a "massive shipment” of Indonesian slab.
"The incoming supply of slab from Indonesia to A&T Stainless represents less than 1% of the annual US stainless production," ATI president and chief executive officer Robert Wetherbee said.
"A&T Stainless has long been scheduled to receive this modest quantity of stainless slabs in the second quarter to satisfy our customer orders through the end of June, when we idle the Midland facility," he added. "That supply will be subject to tariffs, just like everything received from Indonesia since March 2018."
Asked to respond to ATI's statement, NAS CEO Cristobal Fuentes said that "any import - no matter the amount - of Chinese-subsidized, Indonesian slab is a direct replacement of US-produced slab, harming domestic markets and American jobs."
From the outset of its joint venture with Tsingshan, ATI has asked the US Commerce Department for an exclusion that would eliminate the 25% Section 232 tariffs on its imports from Indonesia. Its original request to exclude 300,000 tonnes of imported slab was denied last fall, and ATI filed an amended petition for relief on 150,000 tonnes of imported material. Late last year, ATI also began to buy slab from domestic producers, including NAS.
ATI warned in January that it would have to close its Midland facility if it could not obtain tariff relief. So far, Commerce has not ruled on ATI’s amended request. The company last month announced that it intends to idle the plant at the end of June.
“Denying ATI’s request for a tariff exclusion is really a lose-lose for US manufacturing. ATI has invested over $4 billion in the US over the last decade, with more planned every year. No other stainless producer in the US – including the Spanish-owned North American Stainless – invests more profit back into their US operations than ATI,” Wetherbee told Fastmarkets.
Fuentes countered that NAS parent company Acerinox "has invested billions in our Kentucky operations."
Fastmarkets' monthly assessments for stainless 304 cold-rolled sheet and 304L cold-rolled stainless sheet, fob mill US both fell 2.5% to $117 per hundredweight and $119 per cwt respectively on April 13 from $120 per cwt and $122 per cwt in March, while that for 316L cold-rolled stainless sheet dropped by 3.8% to $154 per cwt from $160 per cwt in the same comparison.