Steel: tougher tarrifs call

The UK’s steel industry unions, Unite, Community and GMB along with steel companies, trade associations, politicians and ministers attended the first meeting of the government’s newly formed Steel Council yesterday (March 3).

The steel unions highlighted the need for immediate action to help the steel industry in its time of crisis. Unions said it absolutely clear that the question Chinese steel imports had to be tackled as there was a “clear and imminent” danger of the collapse of the UK and EU industries.

Speaking after the meeting Unite assistant general secretary Tony Burke said there was a need for urgent and remedial steps to provide some breathing space for the industry – through the EU imposing much tougher tariffs on imported steel.

“I certainly hope the secretary of state at BIS got the message,” Burke noted. “I do not believe China will voluntarily reduce capacity in steel in the foreseeable future unless their hand is forced by the UK and EU.

‘Zombie’ plants

“China has ‘zombie’ steel plants producing steel for which there is little demand, depressing the price and destroying jobs in the bargain. Our arguments have wide support – as does opposition to granting China market economic status which will destroy jobs in manufacturing.”

The Steel Council meeting comes in the wake of 2,200 job losses after the closure of the SSI-owned steelworks in Redcar, 1,200 redundancies from Tata Steel in Scunthorpe and Lanarkshire, as well as 700 in Port Talbot, Wales. At the beginning of the year, Tata Steel confirmed another 1,050 job

 

Unite SIMA branch Shotton works chair Anthony Simpson explained just how dire the situation was at the Tata Steelworks in Shotton.

“We have mothballed a galvanising line with a number of redundancies at the  plant and we are hemorrhaging historically vital engineering skills which is very concerning as we have a lean experienced, skilled workforce with limited people to fill the holes this creates,” Simpson explained.

“This causes us great challenges for reliability and plant output and profit because without the skills to fix the plant it can’t continue to deliver world-class performance,” he added.

“All this is caused by the very serious issues the industry faces and the constant impotent reaction from the government elected to look after our country’s best interests, who clearly fail to realise that steel is a foundation industry for all manufacturing, infrastructure and defence.”

“It should also be clearly noted that the dumping of products from China is now having a knock on effect across other UK manufacturing industries such as ceramics and tyres and will soon cascade into other industries,” Simpson argued. “What worries me and my colleagues greatly is the clear lack off an industrial strategy.”

US steel duties

The Steel Council meeting came just as the US department of commerce announced on Tuesday (March 2) that it would impose preliminary duties on imports of cold-rolled steel from next week to combat dumping of foreign steel.

China is set to face a 265.79 per cent duty in the US, compared to a mere 13 per cent tariff in the EU. Other countries will also be hit with higher import duties in the US, including steel companies in Brazil, which will be hit with a 38.93 per cent tariff and Japanese steel companies with a 71.35 per cent duty.

The preliminary order will see US customs and protection requiring cash deposits based on the duty rates for imports from China and the six other countries facing higher tariffs on cold-rolled steel. A final decision on the new tariffs will be made by the international trade commission next year.

The US has faced a similar crisis in steel, with 12,000 steelworkers either being made redundant or under threat of redundancy as the country faces a deluge of cheap steel imports.

The United Steelworkers (USW) union, Unite’s partner union in the Workers Uniting global union, welcomed the decision by the US department of commerce.

“[Tuesday’s] ruling is just one step in the fight to restore fair trade conditions for American-made cold-rolled steel products,” said USW international president Leo W. Gerard.

“Other industrial goods are under similar attack from foreign dumping and subsidies,” Gerard added. “One of the main causes of this crisis is global overcapacity largely fuelled by China. The solution is not more talk, but strong rules and disciplines that are aggressively implemented and enforced by the U.S. government.”

Simpson expressed frustration that the US has acted to support its steel industry while the UK government has been slow to push for higher tariffs. He highlighted other measures that other EU countries such as Germany and Italy have taken to support their own domestic steel industries.

“This government needs to step up to the issue and stand with us, not behind us,” he said.