Steel Mills

US Steel Mills Mulling Challenge to Russian HRC Imports

June 18, 2014

The US steel industry is contemplating challenging a trade agreement with Russia that governs imports of hot rolled steel from Russia. A suspension agreement currently exempts Russian steelmakers from antidumping duties by setting a cap and minimum price on HRC imports.

According to a Reuters article on Tuesday, US steel companies say the HRC pricing is set too low and are considering urging the Administration to drop or adjust the exemptions.

Russian import of HRC increased 162 percent in the first three months of 2014 compared to the previous three month period.

“Given the volume of imports coming in, the industry is actively exploring its options to terminate or modify the agreement,” an attorney familiar with the Russian case said in the Reuters article. “We are in the process of preparing a filing for the U.S. government.”

A revision or termination of the agreement would benefit domestic steel companies like US Steel, Nucor and AK Steel.

The original 1999 agreement was made following an influx of Russian steel imports after the Cold War. It can be terminated with 60 days notice, or modified by negotiation.

The agreement was renegotiated two years ago increasing the minimum price for HRC imports. The current references prices range from $554.61 per ton to 709.90 per ton

Antidumping duties would be applied immediately should the agreement be terminated. Russian steelmaker Severstal, which is currently looking for buyers for its US-based mills, would face antidumping duties of 73.59 percent on its exports to the US. Other Russian steelmakers could face duties of 184.56 percent.

The challenge comes in the midst of tensions with Russia over the Ukraine conflict as well as a host of trade disputes with other global steelmakers.