Today, U.S. Senators Charles E. Schumer and Kirsten Gillibrand called on the International Trade Commission (ITC) to find evidence that Mexico and Turkey have been dumping cheap steel reinforcing bar – or “rebar” – into the U.S. market, which threatens to undermine companies like Nucor in Auburn. The ITC is currently considering whether there is evidence that the domestic industry has been materially injured by unfairly priced steel rebar from Mexico and Turkey. The Senators noted that domestic rebar industry is operating at only 60% capacity utilization, a historic low, and have been forced to close facilities and lay off workers due to foreign dumping.
Nucor, and rebar producers across the country brought up their case in September of last year. Senators Schumer and Gillibrand wrote a letter to the Department of Commerce in March regarding this case, urging a level playing field for Nucor and its over 300 workers. The Department of Commerce determined that Mexico’s rebar producers are dumping rebar into the U.S., but that companies from Turkey implicated in the case are not dumping. Commerce also found that at least one of Turkey’s major producers is receiving government subsidies. The ITC will make the final decision to determine if duties should be ordered. A duty order on steel rebar entering the U.S. from Mexico and Turkey would effectively level the playing field for U.S. producers. The ITC is scheduled to make a final determination on October 23. If the ITC makes affirmative final determinations that imports of rebar from Mexico and/or Turkey materially injure, or threaten material injury to, the domestic industry, Commerce will issue duty orders.
Schumer and Gillibrand, along with 34 other senators, wrote a letter to ITC Chairman Meredith Broadbent urging her to ensure that foreign subsidies and dumping are prevented from causing additional injury to an already weakened industry. In the letter, the Senators noted that unfairly priced imports have flooded the U.S. market since 2010 at the direct expense of U.S. producers, who have seen their share of the market drop dramatically. Schumer and Gillibrand noted that conditions have deteriorated to such an extent that some U.S. producers have been forced to close production, while others have had to lay off workers, slash hours, and cut pay to stay afloat.
“The International Trade Commission must level the playing field for Upstate New York manufacturers like Nucor in Central New York, which are upstanding companies forced to compete with artificially-cheap foreign imports,” said Senator Schumer. “American manufacturers play by the rules, and it is essential that we ensure foreign competitors are doing the same, and that is why I have urged the International Trade Commission to consider the substantial evidence of damage that is being caused by foreign dumping. It is clear that unfair foreign completion has inflicted harm on Central New York’s steel industry, including Nucor in Auburn, in addition to other companies throughout the state. Nucor employs 300 people in Auburn who should be able to rely on the federal government to protect them from unfair trade practices such as dumping, and I will continue to fight on their behalf.”
“To stimulate economic growth, we must make sure our manufacturers are on a level playing field with their foreign counterparts,” said Senator Gillibrand. “I want to see more Made in America, starting right here in New York with Nucor and other local steel manufacturers. But that can only happen if we protect New York steelworker’s jobs from predatory international practices – by making it harder for other countries to corner the market through unfair and illegal trade. I urge ITC to help end the dumping of cheaper products into the U.S. market, so we can save the jobs of thousands of steelworkers across New York.”
“We are urging the U.S. International Trade Commission to impose trade remedies on dumped and subsidized imports of steel rebar from Turkey and Mexico, and we commend Senators Schumer and Gillibrand for standing with us in this fight,” said Mary Emily Slate, Vice President and General Manager of Nucor Steel Auburn, Inc. “Trade relief is essential to our more than 300 teammates at Nucor Steel Auburn who have been injured by unfair foreign trade practices. We are not asking for special treatment. We are only asking that our government ensure a level playing field for thousands of hard-working Americans by enforcing the rules of international trade.”
Senators Schumer and Gillibrand were joined by the following Senators: John Boozman (R-AR), Lindsey Graham (R-SC), Roy Blunt (R-MO), Richard Burr (R-NC), Roger Wicker (R-MS), Jim Inhofe (R-OK), Mitch McConnell (R-KY), Thad Cochran (R-MS), Johnny Isakson (R-GA), Jeff Sessions (R-AL), David Vitter (R-LA), Tim Scott (R-SC), John Cornyn (R-TX), Richard Shelby (R-AL), Saxby Chambliss (R-GA), Deb Fischer (R-NE), Mark Pryor (D-AR), Sherrod Brown (D-OH), Chuck Schumer (D-NY ), Kirsten Gillibrand (D-NY), Debbie Stabenow (D-MI), Tom Harkin (D-IA), Amy Klobuchar (D-MN), Joe Manchin (D-WV), Kay Hagan (D-NC), Jeff Merkley (D-OR), Cory Booker (D-NJ), Al Franken (D-MN), Dick Durbin (IL), Claire McCaskill (D-MO), Tim Kaine (D-VA), Joe Donnelly (D-IN), Mark Begich (D-AK), Mark Warner (D-VA), Michael Bennet (D-CO), Patty Murray (D-WA).
Dumping is when a foreign company exports their goods into the United States below fair market value. The U.S. Department of Commerce investigates cases of potential dumping by calculating dumping margins, the difference between the US market price of a product and the price in the exporter’s home country, to determine is dumping as occurred. The dumping margins become a duty order if the ITC finds evidence of materially injury or threat of injury of the domestic industry from such dumping. The duty order is a type of tax on the import found to be undervalued, which brings the price of that import to fair value.
Rebar is one of the largest volume steel products produced in the U.S., employing more than 10,000 workers in over 30 states. Nucor Corporation is the largest domestic steel manufacturer in the United States. In 2001, Nucor invested $115 million to acquire what was then a failing steel-making facility in Auburn. In the decade since that acquisition, Nucor has invested an additional $40 million to modernize or upgrade the core components of the steel melting, casting and rolling operations. Nucor’s Auburn facility produces a range of carbon steel products including reinforcing bars and employs over 300 people. With nearly 7 million tons of domestic production, a healthy rebar industry is critical to a strong economy. However imports from Turkey and Mexico are surging into the U.S., nearly double from 2011 to 2013.
In light of these alarming concerns, Schumer and Gillibrand are urging the ITC to give careful consideration to the U.S. steel industry’s arguments regarding investigations involving Turkey and Mexico. Schumer and Gillibrand said that it is essential that foreign subsidies and dumping be addressed in order to prevent further harm to the U.S. rebar industry and the unwarranted loss of American jobs.
A copy of the Senators’ letter to International Trade Commission Chairman Meredith Broadbent is below:
Dear Chairman Broadbent:
We are writing to express support for the U.S. steel reinforcing bar (“rebar”) producers and their workers, and to encourage the International Trade Commission to ensure that foreign subsidies and dumping are prevented from causing additional injury to an already weakened industry.
As the Commission is aware, rebar is used primarily by the construction industry to strengthen concrete structures and is an essential component of American infrastructure. The domestic industry should be benefitting from the modest recovery in construction demand in the wake of the recession. Instead, the industry has faced a continuous onslaught of unfairly traded imports, which has had a negative impact on rebar producers and their families.
Since 2010, these imports have flooded the U.S. market at the direct expense of U.S. producers, who have seen their share of the market drop dramatically. Capacity utilization rates are at historically low levels – near 60 percent – and production levels have yet to recover from the recession. Profitability has collapsed and returns on investment have been inadequate. Indeed, conditions have deteriorated to such an extent that some U.S. producers have been forced to close production, while others have had to lay off workers, slash hours, and cut pay to stay afloat.
The U.S. rebar industry is a major segment of the U.S. steel industry with over seven million tons of production a year. The industry employs thousands of direct rebar workers in several dozen states, and supports tens of thousands of additional jobs throughout the country. These jobs are in jeopardy.
On behalf of the U.S. rebar industry and the workers and their families who depend on the full and fair enforcement of our trade laws for their survival, we urge you to give careful consideration to their arguments regarding investigations involving Turkey and Mexico. It is essential that foreign subsidies and dumping be addressed in order to prevent further harm to the U.S. rebar industry and the unwarranted loss of American jobs.
Thank you in advance for your time and consideration of this critical issue.
Charles E. Schumer and Kirsten Gillibrand
United States Senators