There have been quite a few developments recently with respect to the President's Steel 201 program. WTO Rules Tariffs Illegal Probably of most impact was the World Trade Organization's recent preliminary ruling that the steel tariffs implemented by the Administration last year violate international trade rules (Articles 2.1 and 4.2 of the WTO's Safeguards Agreement and Article XIX of the General Agreement on Tariffs and Trade). Bush Administration officials declared that they would appeal the decision and that the steel safeguard would remain in place while the appeal was ongoing. An appeal would push the final decision back several months ? probably into November of this year, and halfway through the duration of the safeguards program. However, a final ruling against the US would allow the 15-nation European Union, Japan and other governments that brought the case to target US products with sanctions. The European Union has threatened to impose trade sanctions on US imports amounting to some $2.3 billion. The US lost on charges that it had failed to show an increase in imports, failed to adequately establish the link between imports and injury to its domestic steel industry; and had included import figures from NAFTA countries in its injury investigation even though it had excused Canada and Mexico from application of the safeguard remedy. Further, the WTO panel said the International Trade Commission (ITC) had not sufficiently established imports as a cause of serious injury separate from other factors. Ways and Means Requests 332 Investigation On another front, the House Ways and Means Committee Chairman Bill Thomas (R-CA) asked the US International Trade Commission (ITC) to examine the impact on steel-consuming industries of tariffs on some steel imports. Thomas asked the ITC to report by September on the likely impact on steel consumers of keeping the tariffs in place or repealing them by September 20, 2003 - 18 months earlier than planned. For this fact finding investigation (called a 332 investigation), the ITC will conduct its analysis along sectoral lines in order to assess the impact on differing segments of the US manufacturing sector and examine the data as it relates to steel products on which the President imposed steel safeguard measures. To the extent possible, the investigation will address the effects of the safeguard measures on steel consuming industries and on industries which rely on steel imports, such as ports. In its report, the ITC will consider:
In addition, as requested, the ITC will provide an analysis of the potential economy-wide effects of the safeguard measures (i.e., on costs borne by steel consumers, tariff revenues entering the US Treasury, income to steel producers, and the net effect on the US economy). The ITC is seeking input for its general fact finding report from all interested parties and requests that the information focus on the issues for which the ITC is requested to provide information and advice. The ITC will hold a public hearing in connection with the investigation on June 19, 2003. More Exclusions Announced An additional 295 products (out of a total of 661 requests) were excluded by USTR and the Commerce Department from the steel safeguards program on the grounds that they are not currently available in sufficient quantities from US producers and that excluding these products would not undermine the effectiveness of the safeguard on steel products. 208 of these requests were not objected to by domestic steel producers. These new exclusions cover about 400,000 tons of steel, 10% of the amount requested by steel consumers. This action brings to 995 the number of products spared duties. A quarter of the 13 million tons of steel imports originally covered by the tariffs had already been exempted in previous months. Another exclusion process will begin this November. Decisions on these requests will be made in March 2004. Stainless Producers Want India Included A group of stainless bar, angle, rod and wire producers have asked the Administration to add India to the steel safeguards program. Imports of stainless steel products from India have surged since the March 2002 announcement by the president that India would be excluded from the program. At that time, President Bush stated that if a surge in imports occurred from any of the excluded developing countries that undermined the effectiveness of the safeguard provision, the program could be modified to include that country's products. Imports of stainless steel wire from India have risen 159% over the last two years - from a monthly average in 2001 of 304 short tons to 78% average in January and February 2003. Tariffs Decline As per the safeguard program's guidelines, the top rate of 30% on plate, hot-rolled steel, cold-rolled steel, coated steel, tin mill products, hot-rolled bar and cold-finished bar declined to 24%. Tariffs for other products also declined, with the bottom rate of 8% on imports of stainless steel wire dropping to 7% for the second year of the program. Tariff levels will fall further in the third and final year of the program which begins in March 2004. The IAS Group is publishing the second edition of its "User's Guide to Section 201 Product Exclusions." This comprehensive listing of all exclusions allows the user to find in one place all the exclusions by product category. The detailed description of each exclusion appears next to the relevant Chapter 99 number. Items that are subject to caps are also clearly identified. All technical corrections to previously announced exclusions have also been made. Individual copies of this publication costs $450. Contact IAS at iasg@erols.com or by telephone at 202-296-6625 for more information.
 American Wire Producers Association |
