TPT September 2008

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From the AmericaS
September 2008 134 ›
is already seeing annual sales of about $12.3 billion in Europe.
The European Commission has begun a formal antidumping
investigation that could lead to the imposition of punitive tariffs on
the US exports.
Because the US and the 27-member, single-market European
Union both subsidize their biodiesel industries, the dispute holds
potential for a tit-for-tat exchange on the lines of Boeing vs Airbus,
which seems set to go on endlessly. Here, however, there is an
added dimension: many environmental and antipoverty groups
bitterly oppose crop fuels that compete with food on grounds that
they promote famine and do little to fight global warming.
The process of chemical conversion of vegetable oils into
renewable ‘biodiesel’ yields methyl or ethyl ester. After washing
and filtering to meet prevailing standards, the product may be used
in the pure form or in blends with diesel fuel to power compression
ignition engines.
Europe is a net importer of diesel, including biodiesel made from
crops like soy in the US. The European producers charge their
US counterparts with double-dipping: accepting subsidies from
Washington to produce the biodiesel, and benefiting again – from
subsidies granted earlier by European governments to their own
producers – when the fuel is sold in Europe. According to the
European Union, American biofuel producers have increased their
exports to Europe from 7,000 tons in 2005 to about a million tons
in 2007.
The subsidies in question consist of federal excise and income
tax credits, along with grants for increases in production awarded
through a federal program. Raffaello Garofalo, the secretary general
of the European Biodiesel Board, whose complaint to EC trade
commissioner Mr Peter Mandelson in April led to the investigation,
summarized the European view of these boons: “The result is that
American producers are selling at a lower price than we can buy
raw materials. It’s as if they are selling bread cheaper than we can
buy flour.”
There was no immediate response from the National Biodiesel
Board, which represents the biodiesel industry in the United States.
But, while initial findings are not expected until mid-March of next
year, it should be a noisy interval. The European Commission
“will leave no stone unturned in this investigation and will act in
accordance with its findings,” said Peter Power, a spokesman for
Mr Mandelson.
Steel pipe
A new spiral-weld pipe plant is
going up on the West Coast
Work is under way in the California city of Pittsburg on the United
Spiral Pipe plant, a joint venture between United States Steel
Corp and two South Korean steel makers, Posco and SeAH Steel
Corporation. The facility will produce spiral-weld pipe from hot rolled
steel coils, to be delivered to the plant by rail and ship.
As reported on 3 July by Paul Burgarino of the East County Times
(San Jose, California), the factory will occupy 341,500ft2 adjacent
to a USS-Posco Industries plant that manufactures sheet metal
products. The pipe plant is scheduled for commissioning in March
2009 at an estimated cost of nearly $137 million.
Company officials said that North America is experiencing strong
demand for spiral welded pipe for new natural gas and oil lines.
They considered the Pittsburg site to be favourable for manufacture
on the scale projected: 100,000 net tons of linepipe in 2009 and
300,000 in 2010, the plant’s first full year of operation.
“We’re in a good position to be competitive in the North American
market,” said MS Lee, president of United Spiral Pipe.
The economic development director for the city of Pittsburg told Mr
Burgarino that he had put two years of work into bringing the project
to California, including several trips to Korea to help usher the Asian
companies through the city’s permitting process. The expectation
is that the plant will generate yearly tax revenue “in the high six
figures”, this official said.
If the name of the city evokes “the other” Pittsburgh, the home of
US Steel, that is intentional. The East County Times noted that the
original name of Pittsburg – Black Diamond – was changed when
the Columbia Steel Co started up there in 1910.
• American makers of steel pipe, who have complained about
a surge in imports from China, won a major victory when the
International Trade Commission on June 21 cleared the way
for the imposition of stiff penalty tariffs for the next five years.
The commission voted 5-0 that the domestic industry was being
injured by the import of circular welded carbon-quality steel
pipe that is subsidized by China and sold in the US at less than