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The Associated Press
March 2, 2005
Steelmakers Clash with Other Manufacturers over Tariffs
By Malia Rulon
Lawmakers, steel companies and unions urged a trade panel Wednesday to keep steel tariffs on
some foreign imports for five more years. Carmakers and appliance manufacturers said it's time
to let competition back into the market.
The U.S. International Trade Commission is reviewing penalties put in place in 1999 to stop a
flood of low-priced hot-rolled steel from Brazil, Japan and Russia. A second wave of steel
imports from 11 other countries led to additional tariffs in 2002, which President Bush lifted in
late 2003.
"Unfortunately, unfairly traded imports of hot-rolled steel have continued to plague this industry
and continued to harm steel workers and their families," Rep. Ted Strickland, D-Ohio, told the
panel. "Now is not the time to terminate relief as the domestic hot-rolled steel industry has only
just begun to recover."
About two dozen other lawmakers from steel producing states, including Pennsylvania, West
Virginia, Michigan, North Carolina and Illinois, also testified in favor of keeping the tariffs.
But domestic manufacturers such as Ford Motor Co., General Motors Corp., Maytag Corp.,
Whirlpool Corp. and auto parts maker Dana Corp., told the trade panel that the tariffs are causing
higher steel prices and harming their business.
"We believe that the restitution in this case are no longer needed," said Jeff Engel, executive
director for American production purchasing at Ford. "The industry has consolidated, it is
competitive, it has recorded record profits and it is improving."
The U.S. steel industry has rebounded and reorganized since the tariffs were first ordered.
International Steel Group was born after merging several bankrupt steel companies, including
LTV and Weirton, while U.S. Steel and Nucor each acquired other companies.
In 2004, the industry turned its first profit in years. But steel companies and unions say one year
does not make a trend. They want the ITC to continue the tariffs so they can earn enough cash to
ensure financial viability, make capital investments and fund retiree benefits.
The Commerce Department already has determined that lifting the tariffs would result in more
imports from these countries. Trade commissioners at Wednesday's hearing are to decide by mid-
April whether those imports would harm the U.S. steel industry, a key finding that would
guarantee the continuation of the tariffs.
"It's almost impossible to imagine that if they acted as they did in 1998, that injury would not
occur," said Terrence Straub, vice president of public policy for U.S. Steel. "It could destabilize
the market."
But Rep. Joe Knollenberg, R-Mich., told commissioners that auto makers in his state are
struggling under higher steel prices and if they don't get a break soon, more manufacturers will go
bankrupt or move overseas.
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