Addressing trade inequities

U.S. Sens. Sherrod Brown and Rob Portman, both of Ohio, have introduced the Eliminating Global Market Distortions to Protect American Jobs Act, bipartisan legislation designed to strengthen U.S. trade remedy laws and ensure they remain effective tools against unfair trade practices. Their legislation would establish the new concept of “successive investigations” to improve the effectiveness of the U.S. trade remedy system in responding to repeat offenders and serial cheaters, a news release from the senators states.

Portman says, “Nowhere is China’s disdain for the free market more evident than in the steel overcapacity crisis. Twenty years ago, China produced 18 percent of the world’s supply of steel. Now it is roughly 50 percent. … This overcapacity is the result of deliberate choices by China to subsidize their industries and degrade the free market in pursuit of global market dominance, all at the expense of American jobs.”

The senators say the proposed legislation would strengthen trade remedy laws in part by establishing a process for successive and concurrent investigations at the International Trade Commission (ITC) and Commerce Department and by instructing the ITC to consider factors concerning the relationship between the successive investigation and concurrent or recently concluded investigations on the same imported product.

“If these protections are enacted, U.S. steel producers could be better positioned to benefit from proposed infrastructure investments.”

The proposed legislation has been endorsed by the American Iron and Steel Institute (AISI), Washington, and is supported by some steel producers, including Cleveland-Cliffs and Nucor.

Kevin Dempsey, president and CEO of AISI, says, “The American steel industry is the backbone of the economy but has faced repeated surges of unfairly traded steel in recent years. Domestic steelmakers have successfully sought relief under the U.S. trade remedy system, only to face new surges of steel imports of the same products from other countries not subject to the original anti-dumping or countervailing duty orders. This bill will help address the ‘whack-a-mole’ problem, when new imports immediately replace the old ones, by creating successive investigations and allowing for quicker relief than under the current system. The bill also tackles subsidization across borders, such as when Chinese steelmakers—subsidized through China’s Belt and Road Initiative—build new export-oriented steelmaking facilities in other Asian countries, including Indonesia, Vietnam and others.”

If these protections are enacted, U.S. steel producers could be better positioned to benefit from proposed infrastructure investments intended to stimulate our economy following the pandemic. With our electric arc furnace-based steel production, the U.S. already leads the world in producing “green” steel.