Washington – U.S. Senator Blanche Lincoln (D-Ark.) today went to bat for Arkansas’s steel workers, taking the stand at the International Trade Commission (ITC) to seek trade relief for Arkansas companies suffering because of dumped and subsidized steel pipe imports from China. The petitioners from Arkansas include Tenaris Hickman and TMK Ipsco.
Oil Country Tubular Goods (OCTG) are steel pipes used in the extraction of gas and oil. For years, dumped and subsidized imports of OCTG from China have flooded the U.S. market. From 2006 to 2008 alone, the volume of Chinese imports increased by 203 percent. The Department of Commerce has already made a preliminary finding that OCTG from China has been unfairly subsidized at rates ranging from 11 to 31 percent.
As these Chinese imports have been flooding the market, natural gas drilling and overall demand for OCTG has been collapsing. The combination of increased OCTG imports from China and collapsed demand for these products has led to a massive oversupply of inventory and the downfall of the domestic OCTG industry.
“Because of the dumped and subsided imports from China, many workers in Arkansas facilities including Maverick Tube Corporation and TMK IPSCO have lost their jobs, and those who have managed to hang on have seen their hours and wages fall dramatically,” Senator Lincoln said. “The economy of the whole state of Arkansas has suffered as a result.
“Nucor Corporation, which has two major mills in Mississippi County, supplies the two Arkansas OCTG facilities with much of their steel to make into OCTG. Nucor and its workers have suffered because dumped and subsidized imports of OCTG from China have slashed demand for Nucor’s steel. “I believe this case is a poster child for predatory foreign trade practices. Thousands of American jobs could be restored if a remedy is imposed and fair trade is restored. The link between trade relief and saving jobs is direct for Arkansas.”
Senator Lincoln was also joined by 12 of her Senate colleagues today in sending a letter to U.S. ITC Chairman Shara L. Aranoff, which expressed support for the domestic OCTG industry and urged the Commission to ensure that unfairly traded imports from China are not allowed to inflict additional harm on the domestic market.
“American workers and producers need and deserve a fair chance to compete in their own market,” the letter read. “Now more than ever, it is crucial that this Commission fully and effectively enforce our trade laws, and ensure that foreign producers refusing to play by the rules are not permitted to further injure American workers and companies.”
A full copy of the letter is attached.
Lincoln’s remarks as prepared for delivery
Thank you for the opportunity to testify today. I am here in support of the U.S. OCTG industry and its workers in their petition for trade relief from dumped OCTG imports from China.
Let me first discuss some of the facts of this case. The Department of Commerce recently completed its subsidy investigation, calculating final subsidy margins for OCTG imports from China between 10 and 15 percent.
This means that in 2008, the Government of China was giving Chinese OCTG producers a cost advantage over the U.S. industry equivalent to $168 per ton!
On the antidumping side, the Commerce Department recently determined that all Chinese producers but one dumped OCTG into the U.S. market at margins ranging from 36 percent to 99 percent. Indeed, the Department specifically identified almost 40 Chinese producers that had engaged in unfair trade.
Not surprisingly, imports of OCTG from China exploded as a result of these illegal trade practices. From 2006 to 2008, imports increased 203 percent. In fact, unfairly traded imports surged in the second half of 2008, just as the U.S. market was collapsing due to the economic crisis.
Judging from these findings, it is evident that China is dumping OCTG into our market, and the results have been devastating for the steel industry in Arkansas and the nation.
Two of the petitioners in this investigation, Maverick Tube Corporation and TMK IPSCO, have facilities in Mississippi County, Arkansas.
Because of dumped and subsidized imports from China, many of the workers in these two facilities have lost their jobs and even those who have managed to hang on have seen their hours and wages fall dramatically.
The economy of the entire area, and indeed of the whole State of Arkansas, has suffered as a result. Nucor Corporation, which has two major mills in Mississippi County, supplies the two Arkansas OCTG facilities with much of their steel to make into OCTG. Nucor and its workers have suffered because dumped and subsidized imports of OCTG from China have slashed demand for Nucor’s steel.
It is clear the Chinese OCTG industry is a creation of the Chinese government, which has pursued a deliberate policy of increasing the production and export of downstream, value-added steel products like OCTG.
As you’ve found, Arkansas is one of many states impacted by China’s unfair trading practices. I would like to submit to you a bipartisan letter from myself and 12 of my Senate colleagues urging the commission to ensure that our trading laws are enforced.
On a final note, unless the ITC finds injury or threat of injury, and a trade remedy is put in place, OCTG producers in China will continue to flood the U.S. market with unfairly traded OCTG.
Given the current weakness in the U.S. economy, the only possible outcome from this would be still more lost jobs and even greater hardship for the people of Arkansas, and indeed the whole United States.
I believe this case is a poster child for predatory foreign trade practices. Thousands of American jobs could be restored if a remedy is imposed and fair trade is restored. The link between trade relief and saving jobs is direct for Arkansas.
Steel workers in northeastern Arkansas are productive and innovative and can out-compete anyone if the competition is fair. These hard-working Arkansas families are not asking for any special treatment. They are simply asking that existing U.S. laws be enforced.
Their jobs and the well-being of their families literally depend on trade enforcement. Therefore, on behalf of the people of Arkansas, I urge you to take the first step in providing this industry and its workers relief. Thank you.
