The U.S. Steel Corporation's proposal to purchase low-priced, semifinished steel from the British Steel Corp. is now opposed by the Reagan administration, as well as the United Steelworkers of America and U.S. Steel's competitor, Bethlehem Steel Corp.
Lionel H. Olmer, Commerce undersecretary for International Trade, told a House subcommittee hearing Thursday that the U.S. Steel-British Steel proposal would undoubtedly cause the demise of a key U.S.-European agreement that resolved a trade confrontation between American and European steelmakers by limiting foreign steel shipments in 10 major categories.
"We would then be faced with the same trade problems we worked so hard to resolve last year," said Olmer.
While the administration would not try to block the proposal now, Olmer said that if it took effect, the Commerce Department could request licensing of semifinished steel shipments to the United States and "may be compelled to self-initiate an unfair trade case."
Bethlehem chairman Donald H.Trautlein, told a House Foreign Affairs subcommittee that his company is prepared to file trade complaints with the administration and lawsuits against U.S. Steel to block the deal if the administration does not act.
U.S. Steel has proposed to import 3 million tons of semifinished steel slabs annually from the British Steel Corp. to be finished at the American company's Fairless Works outside Philadelphia. British Steel would also invest between $150 million and $600 million in the U.S. plant, although the amount remains under negotiation.
But U.S. Steel says it would close the Fairless furnaces that have produced slab steel in the past because they are too outdated and inefficient to remain in operation. That will cost the jobs of 3,000 of the company's employes, the Steelworkers complain.
Trautlein said the U.S. Steel proposal, and a similar one by Wheeling-Pittsburgh Steel Co. to import semifinished steel from Brazil, are evidence of a serious new import threat to the American industry, particularly from the Third World.