YOUNGSTOWN, Ohio -- The U.S. Department of Commerce announced Tuesday that oil country tubular goods, or OCTG, pipe that is manufactured in China but undergoes minor processing in other countries is also subject to antidumping and countervailing penalties according to U.S. trade law.
The decision prompted applause from Ohio's two U.S. senators, Republican Rob Portman and Democrat Sherrod Brown.
"The Commerce Department's ruling is excellent news for Ohio's workers and manufacturers like U.S. Steel and Vallourec Star," Brown said. "This decision makes it clear that countries like China can't use loopholes to circumvent international law and evade antidumping and countervailing duties."
Portman also supported the decision, calling it an "important step forward in ensuring that American manufactured goods can compete with their global competitors on a level playing field. This is good news to the thousands of American workers who were threatened from the risk of watered-down projections which would have allowed cheap Chinese products to flood our domestic markets."
In 2010, the Obama administration approved measures that placed countervailing and antidumping duties on OCTG pipe manufactured in China and imported to the United States. The International Trade Commission had earlier ruled that evidence existed to prove that China was "dumping" large quantities of low-cost OCTG pipe on the U.S. market, threatening pipe and tube producers in this country.
To subvert this law, Chinese companies began to ship their pipe to other countries where it would undergo minor alterations before it was shipped to the United States, thus masking the pipe's true country of origin.
The Commerce Department's ruling states that such minor alterations do not justify changing the pipe's country of origin import status. Therefore, these products would face the same trade penalties as if they were shipped directly from China.
Companies such as Vallourec Star, which constructed a new $1 billion fine quality mill in Youngstown, are among the major suppliers of OCTG pipe in the United States. The company employs nearly 800 in Youngstown.
Published by The Business Journal, Youngstown, Ohio.
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