United States Steel Corp., in a move expected to draw immediate retaliation from the Carter administration, announced yesterday that it will file dumping charges against seven European steel makers.
The company said it would file the charges with the Commerce Department today against companies producing steel in France, Great Britain, West Germany, Belgium, Itlay, Luxembourg and the Netherlands.
The Carter administration has repeatedly warned the industry that it would abandon its Trigger Price Mechanism if dumping charges were filed. Commerce Department officials said yesterday that they would not comment further until the complaints acutally were filed.
The announcement by U.S. Steel, the nation's largest steel maker, came less than 24 hours after the Commerce Department left the trigger prices for second-quarter imports unchanged. Steel industry officials had warned the administration they would file the dumping charges unless they received some additional trigger price relief.
Suspension of the trigger prices, which set minimum prices for steel imports based on the costs of the most efficient foreign producer (Japan), could plunge both the foreign and domestic steel industries into turmoil.
Some industry leaders, however, said that many foreign steel producers concerned about receiving a finding in their favor, would'nt rush to dump their steel on U.S. markets. Steel importers would also be wary of contracting for more foreign steel because of the possibility the U.S. government would decide that import prices were too low and have injured the domestic market. In the case, dumping duties would be charged to the foreign producers, Commerce Department officials said.
U.S. Steel said that at 9 a.m. today it will file 80 cartons of materials stacked five feet high with the Commerce Department and the International Trade Commission outlining its allegations that the foreign steel producers injured the domestic steel market by selling steel here during the last five years at less than fair value.
The products named in the complaints are mainly used in the construction of automobiles, appliances and buildings.
Most of the nation's leading steel makers yesterday had little to say about U.S. Steel's move, which will affect their business as well as that of U.S. Steel. But some like officials at Armco Inc., the No 3 domestic steel producer, said that trigger pricing has been ineffective.
The Trigger Price Mechanism was conceived as an alternative to major antidumping cases and was created by the Carter administration to head off the Carter administration to head off a possible trade war when American steel producers filed numerous antidumping cases about three years ago.
The trigger prices last were raised in November to affect the first quarter of this year, which began in January. At that time the prices were increased by about 5 percent.
"United States Steel has no alternative but to file these charges with the hope that the processing of these cases will result in equitable treatment under our trade laws," said U.S. Steel President David Roderick. "The announcement of second quarter trigger prices being continued at the same level as first quarter prices underscores the structural inadequacy of the Trigger Price Mechanism.
Roderick added later that "the trigger prices being kept at the same level as the first quarter further magnifies the inequities, structural defects and understatements of costs inherent" in the Trigger Price Mechanism.
Commerce officials at a press briefing Wednesday said that the trigger prices wouldn't be changed because they were reviewing complaints and suggestions about the program. The department had recently been given the Treasury Department's authority over the program as part of President Carter's trade reorganization plan.
But industry sources contended yesterday that Commerce acted politically. If it had raised trigger prices, it would have been deemed inflationary contravening the president's new anti-inflation program, they said.
U.S. Steel's Roderick blamed "unfairly priced steel imports" for part of the steel industry's woes. "The country's steelworkers have lost and are losing jobs and, along with their families, have their lifestyles harmed," Roderick said. "Over 100,000 unemployed steelworkers have been granted federal unemployment assistance because their jobs were lost to imports."
Roderick failed to mention, however, that the U.S. steel industry uses equipment that is old, obsolete and inefficient.
Dumping complaints, can be expensive and laborious even with the streamlined trade laws, because the industry must prove that the steel is being sold in the United States at prices lower than it is being sold in the home country -- and that domestic workers and companies are being injured by the imports.
The first major break in the complaint process won't come until about five or possibly seven months. At that time the Commerce Department will make a preliminary finding that import prices are too high or too low, and dumping fees could be established.
If import prices are found to be below the fair value, final decisions by the ITC and Commerce could take several months more.