Manufacture This

The blog of the Alliance for American Manufacturing

More than 12,000 steelworkers have been laid off due to the steel imports crisis.

American steelworkers are finally starting to see some relief.

The Commerce Department on Tuesday set anti-dumping duties on cold-rolled flat steel imports from seven countries, a step forward for U.S. steelworkers and companies that have suffered because of the unprecedented surge in steel imports from places like China.

The preliminary order places duties of nearly 266 percent on cold-rolled steel from China, whose massive industrial overcapacity problem is driving the steel imports crisis. Duties were also placed on certain cold-rolled flat steel imports from Brazil, India, Korea, Russia, Japan and the United Kingdom.

The International Trade Commission is expected to issue a final decision on duty levels later this year.

“Steel has literally been the backbone of our great nation from the railroads that span America to the iron girders that support our office buildings, schools and bridges,” United Steelworkers (USW) President Leo Gerard said in a statement. “Today’s ruling is just one step in the fight to restore fair trade conditions for American-made cold-rolled steel products.”

Cold-rolled steel products are used in appliances, automotive products, containers, industrial equipment and construction, according to the USW. But these products aren’t the only steel goods impacted by the steel imports crisis. In fact, the Commerce Department announced a 256 percent tariff on corrosion-resistant steel imports from China in December 2015.

Steel overcapacity is a worldwide problem. China’s state-subsidized steelmakers continue to churn out massive amounts of steel at a time when that country’s economy is slowing down. As a result, there is currently 336 to 425 million metric tons of steel going unused there.

Much of it is being dumped on U.S. shores, at rock-bottom prices. It’s hugely unfair to U.S. steelmakers and workers who operate in an open market and by environmental and labor rules. As a result, more than 12,000 U.S. steelworkers have been laid-off or face layoffs as U.S. companies weather the crisis. Dozens of steel-making facilities in places like Minnesota, Indiana, Ohio, Michigan, Pennsylvania and Alabama have been idled.

Tuesday's ruling helps level the playing field for these American workers and companies. But it's only a start — and as Gerard noted, it isn’t just steel impacted by China. Other industrial goods makers also are facing hardships because of China’s overcapacity problems.

“The solution is not more talk, but strong rules and disciplines that are aggressively implemented and enforced by the U.S. government,” Gerard said. “Enforcing our trade laws isn’t a gift, it’s a right.” 

President Obama promised that his administration would use new tools in the Customs and Trade Enforcement Bill (which he signed into law last week) to take action to address the impact China’s overcapacity is having on American companies and workers. 

“They realize that they can’t forever sustain an export-driven growth model, but it’s going to take some time, and it’s temping for them to solve short-term problems by just dumping a bunch of state-subsidized goods into the U.S. market,” Obama said during the National Governors Association Winter Meeting on Feb 22. “And we’ve been very clear with them, that’s not going to work, we’re going to put in place tools to make sure it doesn’t work.”

While the Commerce Department ruling is a step forward, there are additional steps that can be taken to address the steel imports crisis. For example, Congress should ensure the Office of Enforcement and Compliance at the Commerce Department is properly funded. The Obama administration also should continue China’s non-market economy status beyond December 2016. In addition, the administration should finally name China a currency manipulator.

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