Japan says it shipped only what was ordered
By Staff -- Purchasing, 3/11/1999
Japan never intended to flood U.S. markets with steel exports, and its exports are now declining, says Trade Minister Kaoru Yosano. Meanwhile, Japan's Ministry of International Trade and Industry has decided against bilateral consultations with the U.S. government because new global trade rules say international arrangements must now be coordinated by the World Trade Organization.U.S. steelmakers have complained about a surge of imports at allegedly unfair prices. Japanese steel has been cited specifically as imports have exploded by 167%, making that country the largest steel exporter to the U.S. at 5.7 million metric tonnes. Yosano insists the sharp rise in Japanese steel exports to the U.S. last year was mainly due to strong demand for steel caused by robust North American economic growth.
On Capitol Hill, 37 congressmen have urged President Clinton to self-initiate a Section 201 case on steel imports to send a "clear signal that the U.S. will no longer tolerate cartel-like Japanese practices in steel trade," says Rep. John Dingell (D., Mich.). The congressman says that "since the Japanese have plainly indicated no interest in curtailing outdated economic practices, the President should impose trade restrictions on their steel imports."
However, the World Trade Organization in Geneva, Switzerland, has agreed to investigate the 1916 Anti-Dumping Act and other U.S. anti-dumping laws, which are under attack by the European Union. Now, a dispute-settlement panel will decide whether existing U.S. trade laws are in violation of the WTO treaty, which the U.S. has signed.
The Japan Steel Information Center has issued a position paper stating that U.S. manufacturers and steel mills ordered millions of tons of foreign steel, including Japanese products, to meet a high level of demand last year. "Business was so strong that at least 25% of the steel imported in 1998 was purchased by American steel-related companies to process into higher-value products to serve U.S. customers," according to the group's statement.
"Japan never intended to flood the U.S. with the Japanese steel," Yosano says, adding that Japanese steel exports to the U.S. have been declining since the end of last year. "In fact, Japanese steel exports have begun to drop since December of last year," he says, pointing to Census data that imports from Japan fell to 367,000 metric tons in December from 750,781 tonnes in November.
Based on order-data available in Japan, "we see a further decline in exports in the first quarter of 1999," says Shinya Okuda, director of the iron and steel division of miti's basic industries bureau. He points out that Japanese steel production in the first quarter was down substantially from previous quarters, and adds that "Japan produced 10.5% less steel in 1998 than it did in 1997."
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