Senators introduce federal bill designed to strengthen trade remedy laws

U.S. Sens. Sherrod Brown and Rob Portman, both of Ohio, have introduced 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 and protect American workers. 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, helping to level the playing field for American workers, according to a news release from the senators.

“For too long, trade cheats have shuttered plants across our state, put Ohioans out of work and distorted global markets,” Brown says. “This bipartisan legislation will strengthen our trade remedy laws, make clear the U.S has the tools to fight back against these harmful practices and will help keep Ohio workers on the job.”

“This bipartisan bill will strengthen our antidumping and countervailing duty laws to challenge China’s unfair trade practices and protect American jobs in sectors that are important to Ohio,” 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. Today it is steel, but tomorrow it could be electric vehicles or semiconductors. 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 Eliminating Global Market Distortions to Protect American Jobs Act will strengthen trade remedy laws in part by:

• establishing a process for successive and concurrent investigations at the International Trade Commission (ITC) and U.S. Department of Commerce (Commerce Department) and instructing the ITC to consider certain factors concerning the relationship between the successive investigation and concurrent or recently concluded investigations on the same imported product;

• requiring the Commerce Department to issue preliminary determinations in these repeat offender cases to ensure quicker relief for U.S. manufacturers and workers, thereby strengthening the ability of the U.S. government to enforce antidumping and countervailing duty laws;
• addressing the growing problem of cross-border subsidization, as foreign governments subsidize their own manufacturers not only at home but in third-country markets as well; and
• clarifying the Commerce Department’s authority for antidumping and countervailing duty proceedings, helping to crack down on importers that attempt to evade antidumping or countervailing duties, and allowing the Commerce Department to require importers to provide certification upon entry of an article into the United States that the imported article is not subject to an antidumping or countervailing duty order. 

The Eliminating Global Market Distortions to Protect American Jobs Act, has been endorsed by the American Iron and Steel Institute (AISI), Washington, and is supported by a number of steel companies with operations in Ohio, including Nucor, SSAB Americas, Wheatland Tube of Niles and Warren, Ohio, Cleveland-Cliffs Inc. and ArcelorMittal North America. The legislation is also supported by other Ohio manufacturers, including Mullet Cabinets of Millersburg, Ohio.  

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 antidumping 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. This bill will go a long way in fighting against these unfair subsidies which can injure U.S. producers.”

Dempsey also applauds the provisions of the bill addressing the statutory timelines for anti-circumvention inquiries, clarifying the standards by which the Commerce Department will investigate allegations of currency undervaluation as a subsidy and other provisions to combat trade distortions in the steel market.

“By strengthening the effectiveness of the U.S. trade laws, this bill will help give the American public confidence that their government has every tool available to fight for a level playing field for every American worker. We appreciate the continued leadership of Sens. Brown and Portman in support of the American steel industry and urge senators to quickly support this bill,” he adds.  

“Cleveland-Cliffs greatly appreciates the strong leadership of Sen. Brown and Sen. Portman in championing this legislation, which will provide new tools to combat distortion and circumvention of our U.S. trade laws,” Lourenco Goncalves, chairman, president and chief executive officer at Cleveland-Cliffs Inc., which is headquartered in Cleveland, says. “Cleveland-Cliffs is the largest producer of flat-rolled steel in the United States, employing more than 25,000 highly skilled workers. We rely on strong and modern trade laws to confront unfair trade practices in order to preserve and create more good-paying, middle-class union jobs in the United States.”

Eric Mitchell, vice president and general manager at Nucor Steel Marion in Marion, Ohio, says, “This bill would close many of the loopholes that have allowed foreign steel producers to circumvent our trade laws. It would give U.S. agencies clear authority to take proper enforcement measures against illegal subsidies, duty evasion and other practices that have injured U.S. steelmakers for years.”

Kevin Kelly, president of Wheatland Tube, says, “[O]ur company and employees have benefitted from remedies provided by the  AD/CVD laws and we thank the Senators for their ongoing work to ensure the laws remain accessible and strong. These laws ensure that Wheatland can continue to compete and be part of the nation's economic recovery.”

“This legislation will strengthen the tools available to U.S. manufacturers to fight foreign dumping and subsidies, including currency manipulation,” says John L. Brett, CEO of ArcelorMittal North America.

"Our company and our employees recognize the importance of having strong trade laws in place to challenge unfairly traded imports. As a U.S. kitchen cabinet manufacturer and a family-owned business, we know firsthand how the trade laws have worked to provide relief to our company and our employees,” says Vince Mullet, president of Mullet Cabinets of Millersburg, Ohio.

“In Kentucky, North American Stainless employs more than 1,500 American steelworkers who, if given a level playing field, can compete and win in the global market,” says Cris Fuentes, chief executive officer at North American Stainless. “Importantly, this bill closes a loophole in our trade law by giving Commerce the authority to investigate, consider and act on subsidies offered by countries to producers located elsewhere.” He added, “We must put an end to ongoing attempts to undermine America’s national security and destabilize our critical manufacturing industry.”

Based on preliminary Census Bureau data, the AISI reported that the U.S. imported a total of 1.89 million net tons of steel in February 2021, including 1.42 million net tons of finished steel (down 22 percent and up 15 percent, respectively, compared with January final data). Through the first two months of 2021, total and finished steel imports are 4.31 million and 2.66 million net tons, down 7.5 percent and 11.1 percent, respectively, compared with the same period in 2020. Annualized total and finished steel imports in 2021 would be 25.9 and 16 million net tons, up 17.4 percent and down 1 percent, respectively, compared with 2020. Finished steel import market share was an estimated 18 percent in February and is estimated at 17 percent over the first two months of 2021, AISI says.

Key finished steel products with a significant increase in imports in February compared with January are tin plate (up 158 percent), cold-rolled sheets (up 69 percent), hot-rolled sheets (up 63 percent), line pipe (up 38 percent), mechanical tubing (up 19 percent) and wire rods (up 17 percent), AISI notes. A product with a significant year-to-date increase versus the same period in 2020 was structural pipe and tubing, which is up by 13 percent.