Measures are just trade protectionism, firms say

The probes into Chinese steel launched by the US are actually trade protectionism and Chinese steelmakers will take the necessary measures to protect their rights, domestic steelmakers said Thursday.

"The reckless moves by the US aim to block Chinese iron and steel imports. We have been investigated a dozen times in the past decade, and we won almost all the cases," Sun Jin, director of the international publicity office of Wuhan Iron & Steel Group, told the Global Times on Thursday.

China firmly opposes the US abuse of trade remedy measures and trade protectionism, China's Vice Finance Minister Zhu Guangyao said at a briefing on Thursday in Beijing, chinanews.com reported.

The US has launched a series of anti-dumping and countervailing duty investigations against Chinese iron and steel exports in recent years.

Most recently, the US Department of Commerce said Wednesday that China has been dumping certain iron mechanical transfer drive components in the US, with preliminary dumping margins of 2.17 percent to 401.68 percent, the Xinhua News Agency reported on Thursday.

On May 26, the US International Trade Commission announced that it would investigate a complaint by the US Steel Corporation of Pittsburgh, which said that Chinese steelmakers had conspired to fix prices, steal trade secrets and misrepresent the origins of certain carbon and alloy steel products being exported to the US.

"The steel industry is unlikely to involve intellectual property as it is a mature industry. And we do not have to steal secrets because we have our own research and development institutes and patented technology," Sun noted.

Baosteel Group strictly follows the laws and regulations of the countries and regions where it operates, and always focuses on self-dependent research and development, said a statement on the company's website in May.

The repeated investigations launched by the US to shield its industries are abusing WTO rules, the statement also said.

The US intends to protect its own industry by taking advantage of "the surrogate country system," Chen Weidong, a professor with the law school of the Beijing-based University of International Business and Economics, told the Global Times on Thursday.

The "surrogate country system" is a term used by the EU in anti-dumping probes, under which costs of products in a third country are used to estimate the value of those from non-market economies. This practice should come to an end by December 11, 2016, according to the agreement signed when China joined the WTO on December 11, 2001.

Relatively cheap Chinese steel is popular with importers, said Wu Chenhui, a Beijing-based independent industry analyst.

Cutting overcapacity

China produced 804 million tons of steel in 2015, down 2.3 percent from 2014, according to data released in February by the Ministry of Industry and Information Technology.

In the first four months of 2016, China exported 36.90 million tons of iron and steel, up 7.6 percent year-on-year, China's General Administration of Customs said on May 8.

The US accounts for 3 percent of Chinese steel exports, and the EU takes 4 percent, Reuters reported in March.

Given the relatively modest amount of imports from China, Chinese steel should not be blamed for the sluggish steel industry and layoffs in the industry in the US, insiders said.

"Iron and steel capacity is a global issue and Chinese steel producers are making efforts to deal with it. Wuhan Iron & Steel Group has cut its iron and steel capacity by 5 million tons and plans to cut another 7.6 million tons in the next few years," Sun noted.

There is still great demand for Chinese steel in the world and the prices are rising, which contributes to the improvement of the domestic steel sector, Wu told the Global Times Thursday.

He said domestic steelmakers should upgrade and produce more high-tech products.