European Union trade chief plans to probe Chinese steel

Mills follow U.S. lead in seeking dumping duties

By Tom Stundza -- Purchasing, 11/28/2007 10:18:00 AM

European Union Trade Commissioner Peter Mandelson is leaning toward investigating a complaint by steelmakers ArcelorMittal and ThyssenKrupp about cheap imports of stainless steel cold-rolled sheet from China, South Korea and Taiwan. The two companies led a steelmakers lobby that last month asked the European Commission for punitive duties on the imports.

The steel group, called Eurofer, also says Chinese producers are selling hot-rolled sheet and zinc-coated coated sheet below European prices, a practice known as dumping. “We're likely to open a probe, as we're bound to do when presented with evidence of this kind,'' Mandelson told Bloomberg News in an interview yesterday.

The late-October demand by European steelmakers followed a petition in June by six North American steel producers for U.S. duties on welded steel pipe from China. The European and American companies say that by selling products cheaply, China risks returning the steel industry to a boom-and-bust pricing cycle. China, which was a net importer of steel in 2003, now produces a third of the world's steel and has expanded exports dramatically.

Just yesterday, the U.S. Commerce Department proposed preliminary 77.85% countervailing duties on imports of Chinese-made rectangular steel pipe, used for fencing and railings tubes. “The (Bush) administration is committed to aggressively enforcing U.S. trade laws to achieve a strong and fair trading relationship,'' David Spooner, assistant Commerce secretary, says in a statement.