Steel Mills

JSW USA Tariff Exclusion Case Moves to USITC

October 7, 2019

JSW USA has filed a challenge to a tariff exclusion denial with the U.S. Court of International Trade. In the first tariff exclusion case to reach the USCIT, JSW claims that Commerce ignored evidence presented regarding the domestic availability of steel slab. The company is requesting a refund of the tariffs it was required to pay.

JSW uses steel slab imported from its parent company in India and from Mexico to produce steel plate and large-diameter welded line pipe at its Baytown, Texas, facility. The company provided evidence that domestic steel mills do not produce or make available enough steel slab for JSW’s needs. JSW claims that Commerce did not verify steel slab production capabilities claimed by U.S. Steel, Nucor and AK Steel in their objection to JSW’s exclusion request. Commerce instead sided with the steel producers and issued boilerplate denials.

The Commerce Department denied the allegations in an Oct. 7 response to JSW’s lawsuit.

Should JSW prevail in its suit at the USCIT, it would “absolutely open the floodgates” to many similar court challenges, said Adams Lee, a trade lawyer with Harris Bricken in a comment to Bloomberg Law.

JSW USA has previously supported the administration’s Section 232 tariffs as a method to restrain steel imports and revitalize the U.S. steel industry. Then in August, the company announced it would put on hold its plans to install an electric arc furnace and slab caster at Baytown due to “current market conditions and the prevailing policy environment.”

At a September event with Prime Minister Narendra Modi, President Trump lauded the investment by JSW Steel in its U.S. division as a the “perfect example of strong business ties between India and the U.S.” No mention was made of the tariff dispute.

Parth Jindal, Director of JSW Steel USA, reiterated the company’s plan to move forward with its U.S. investments: “We are pleased to share our intention for additional investments in the U.S. It is our intention to further augment our capacity in Acero Junction over the next few years and to take the combined capacity of JSW USA to 4 MT per annum—3 MT at Acero and 1 MT at Baytown in Texas.”