Message to Congress: Illegal Dumping Puts Steel Jobs At Risk

By Elizabeth Brotherton-Bunch
Mar 26 2015 |
Nucor Corporation President John Ferriola, U.S. Steel Corporation President Mario Longhi and United Steelworkers International Vice President Tom Conway testify before the Congressional Steel Caucus. | Photo by Holly Hart

Industry and labor representatives deliver a dire warning to the Congressional Steel Caucus.

Thousands of good-paying steel jobs already have been lost and 150,000 more are at risk because of unprecedented levels of foreign steel dumping by countries such as China, steel industry representatives told Members of Congress on Thursday.

At the annual State of Steel hearing, chief executives from the country’s leading steel companies told Members of the Congressional Steel Caucus that the U.S. government needs to get serious about enforcing its trade laws in order to save steel jobs, if not the entire U.S. steel industry. United Steelworkers International Vice President Tom Conway echoed those concerns, noting that current remedies for addressing unfair trade practices simply aren’t working.

The Commerce Department and the International Trade Commission found significant steel dumping by countries such as South Korea in 2014, for example, eventually issuing tariffs on Oil Country Tubular Goods (OCTG). But getting to that conclusion took a long time — and workers and companies suffered during the process.

“The simple truth is, when we win a case, we simply stabilize the market — we rarely get back to where we were,” Conway testified. “We are ratcheting down our industrial sectors into oblivion. In the process, we hemorrhage good jobs just like is happening right now in the steel industry.”

Foreign steel imports increased by 36 percent from 2013 to 2014, and as a result, American steel mills are running at just 69 percent of their capacity, John Ferriola, chairman and president of the Nucor Corporation, testified. The reason for this sharp increase? Many foreign countries and their producers are ignoring the rules of international trade, and the Obama administration has “been far too soft” on enforcement, Ferriola added.

Nearly 6,000 jobs have been lost in the past year due to the surge of steel imports, Michael Rippey, chairman of Arcelor Mittal USA, testified. Just Wednesday, U.S. Steel announced it would temporarily idle operations at its facility in Granite City, Iliinois due to steel imports, issuing layoff warnings to 2,080 workers.

Mario Longhi, president and CEO of U.S. Steel, told caucus members that the company remains committed to the Granite City plant and hopes to bring it back online as soon as possible. But Longhi also noted that the company is facing tremendous obstacles, as it must prove significant harm from foreign steel dumping before it can seek any remedy.

“American steel companies are being irreparably harmed by illegal trade practices,” Longhi testified. “When Congress incorporated the injury standard, it did not intend for companies or workers to suffer severe, persistent harm before they can seek relief. A 1979 colloquy between the late Sens. [H John] Heinz and [Abraham] Ribicoff made abundantly clear that it would be perverse to insist that an American company experience grievous harm before coming entitled to the full protection of its nation’s laws.”

The import problem could get worse, the witnesses cautioned, if proposed trade agreements such as the Trans-Pacific Partnership (TPP) do not include strong, enforceable language prohibiting currency manipulation by countries such as Japan. Ferriola also was among those who noted that as Congress prepares to debate the Trade Promotion Authority, Members should use the debate as an opportunity to strengthen trade laws.

Members of Congress at the hearing appeared largely sympathetic, with caucus Chairman Tim Murphy (R-Pa.) noting that the testimony was “sobering and alarming, but something Congress has to deal with.” Rep. Peter Visclosky (D-Ind.) said that “we simply cannot afford to tolerate unfair and illegal trading practices” while Rep. Mike Doyle (D-Pa.) noted that the TPP would be “a joke” unless it includes strong currency language.

Witnesses also called upon Congress to pass long-term funding for infrastructure investment, which would create millions of jobs and make the United States more competitive on the international stage. They also urged Members to invest more in science, technology, engineering and math (STEM) education, which will be crucial in the coming years for job recruitment and industry innovation.