WCA January 2013

From the americas

between Washington and Beijing, the WTO ruling gave President Barack Obama a timely win as he defended himself against accusations by his Republican opponent, Mitt Romney, that he is soft on China. In fact Mr Obama had already won WTO victories against Beijing in areas ranging from intellectual property rights to financial services to raw materials trade, and launched several other challenges – including a case against Chinese export restrictions on rare earth materials. Mr Obama also created an interagency trade enforcement unit to devote more resources to ensuring that China and other countries abide by global trade rules. Elsewhere in steel . . . ❖ ❖ In other news of AK Steel, the West Chester, Ohio company raised its spot market base prices for all carbon flat-rolled steel products by $40 per ton, effective 17 th October. The company produces flat-rolled carbon, stainless, and electrical steels, largely for the automotive market. ❖ ❖ Scrap steel prices in the US were down last year – some 26 per cent through late October. But on 26 th October a risk manager at INTL FCStone Inc told Bloomberg News that he saw a rebound dead ahead. In a telephone interview from New York, Spencer Johnson said, “Mills are already raising prices for finished steel, and part of the reason may be that they’re expecting higher costs” for scrap metal. Mr Johnson reasoned that producers, having met with at least some success in a bid to charge more for finished steel, were likely to renew the push for higher prices as early as November. Citing Steel Business Briefing data, Bloomberg reporter Joe Richter noted that the US average price of shredded steel scrap fell 3.7 per cent in September to $392.50 a long (2,240lb) ton. Recycled metal surged 12 per cent last year, after a 40 per cent increase in 2010. ❖ ❖ McNeilus Steel Inc (Dodge Center, Minnesota), a full-line steel distributor and processor, broke ground in October on a $15 million coil processing facility in Fond du Lac, Wisconsin. On completion by August 2013, the 96,000-square-foot addition to an existing service centre will deliver steel coil to Minnesota via CN Railroad. Greg Head, the company’s general manager, said that the Fond du Lac expansion would make that location “self-sufficient”, processing coil product from 16 gauge to 5/8-inch thick. It will also, he told the Fond du Lac Reporter (8 th October), “save us on freight from the mill and from processing the coils in Minnesota.” In addition to Dodge Center and Fond du Lac, McNeilus Steel has a service centre in Fargo, North Dakota.

Progress : The forging press has been installed and production set for early this year. The building that will house the ladle refiner is in place and some equipment has arrived. Additional equipment is expected by midyear, and production should start in 2014. Site preparation and building construction for the vertical caster have begun, Timken spokesman Dan Minnich said. Equipment will have arrived by midyear, and production should start in 2014. Project : Charter Steel said in October that it would expand the electric arc furnace at its Cuyahoga Heights mill by about 25 per cent. Progress : Construction was set to start in January during regularly scheduled downtime. The expanded furnace should be running before the end of this year. The World Trade Organization hands the US a victory over China in a case involving Chinese duties on speciality steel exports The World Trade Organization on 18 th October barred China from imposing duties on US exports of grain-oriented electrical steel, used in the cores of high-efficiency transformers, electric motors, and generators. The WTO sided with Washington in a dispute with Beijing over the speciality steel, produced by AK Steel Corp of Ohio and ATI Allegheny Ludlum of Pennsylvania. The US brought the case in September 2010, after China accused American exporters of dumping the steel on the Chinese market and levied punitive duties on the imports. The tariffs, which AK Steel said averaged about 19.5 per cent on its products, potentially affected hundreds of millions of dollars’ worth of grain-oriented electrical steel. China imposed the duties after state-owned steel firms Baosteel Group and Wuhan Iron and Steel Group complained about material coming in from the US and Russia, which was not yet a WTO member and not involved in the case. The Chinese companies objected to “Buy America” provisions of the American Recovery and Reinvestment Act of 2009 and to various state government procurement laws. The WTO appeals judges on 18 th October upheld an original ruling, published in June, rejecting China’s claims that the three-person panel judging the case at that time had misinterpreted the WTO rules. As noted by Reuters, the decision of the earlier panel, which was chaired by New Zealand’s ambassador to the WTO, John Adank, received one of the most ringing endorsements by the appellate body in recent years. ❖ ❖ Reuters also observed that, although the speciality steel case is “tiny” compared with other trade disputes

Dorothy Fabian Features Editor

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Wire & Cable ASIA – January/February 2013

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