U.S. Producers Of Carbon And Certain Alloy Steel Wire Rod File Antidumping And Countervailing Duty Petitions Against China

A five-company coalition of U.S. producers of carbon and certain alloy steel wire rod ("wire rod") comprised of ArcelorMittal USA LLC, Charter Steel, Evraz Rocky Mountain Steel (aka EVRAZ Pueblo), Gerdau Ameristeel US Inc., and Keystone Consolidated Industries, Inc. ("the Coalition"), was joined by Nucor Corporation in filing an antidumping duty petition charging that unfairly traded imports of wire rod from China are causing material injury to the domestic wire rod industry. The dumping margins alleged by the domestic industry range from 100 to 110 percent. The domestic industry also filed a countervailing duty petition alleging that the Chinese Government provided significant subsidies to Chinese wire rod producers.  The petitions were filed concurrently with the United States Department of Commerce ("Commerce Department") and the United States International Trade Commission ("USITC").

The petitions were filed in response to large and increasing volumes of low-priced imports of wire rod over the past three years that have injured U.S. wire rod producers.  In 2012 and 2013, imports of wire rod from China surged into the U.S. market, rising from 144 tons in 2011 to over 614,000 tons in 2013. China is now the largest source of wire rod imports in the United States. The petitions allege that producers in China have injured the domestic industry by selling their products at unfairly low prices that significantly undercut U.S. producer prices. As a result of this unfair competition, the domestic industry has suffered declines in production, sales, and employment, and has seen its profitability diminish. The petition states that Chinese producers covered by the petitions have massive capacity to produce wire rod and pose a continuing threat to the health of the U.S. industry. If the cases are successful, import duties will be imposed, offsetting the unfair trade practices that have allowed the imports from China to injure the domestic industry.

As a result of the filing of the petitions, the Commerce Department will determine whether to initiate the antidumping and countervailing duty investigations within 20 days, and the USITC will reach a preliminary determination of material injury or threat of material injury within 45 days. The entire investigative process will take approximately one year, with final determinations of dumping, subsidization, and injury likely occurring in early 2015. (SOURCE Kelley Drye & Warren LLP)