Wire rod antidumping case: confusion reigns supreme

Wire rod antidumping case: confusion reigns supreme

Recently, there have been a few conflicting reports in the media on various aspects of the antidumping suit against wire rods from China, Turkey, and Germany. Let us take a moment to clarify some critical points. Firstly, it was misreported that Goodyear is upset that the Habas wire rod mill in Turkey was included in the suit since it is a major source for Goodyear's tire cord rod grades. Habas is in essence a low carbon rebar and wire rod mill. They may have ambitions to go into higher carbon grades but tire cord is out of their scope. At least it has been so far. In fact, looking at the average unit price of imported Turkish wire rods in 2005, it becomes clear that only low carbon rods have been supplied by Turkish mills. Also, a German steel federation spokesman has been quoted in the media that he was "surprised and disappointed" that German mills were included because - among other reasons – German wire rod exports consist mostly of "high quality" grades such as tire cord and that those grades are not readily available through US rod mills. The German Steel Association has to understand that the antidumping suit against German wire rod is aimed at the Riva-owned mill in Brandenburg, Germany. The numbers of the German wire rod exports to the US bear this out: On December 14, the US Census Bureau reported that Germany shipped 155'612 metric tons in the first nine months of 2005. Looking at the average unit price, only 9'369 mt were tire cord or other "high quality" grades. That leaves 146'243 mt in grades that can be readily supplied by the US rod industry and the vast majority of this amount were mesh grade rods that were primarily, if not exclusively, supplied by Brandenburg as far as Germany goes. Still, the Germans have a point. It was unconscionable that the tire cord grades were included in this suit (they had been excluded in the rod dumping action before this one). Petitioners will have a hard time to prove that they can adequately supply the tire cord market. We will not be too surprised if tire cord grades will be excluded at some point in the ongoing investigation. The next date to watch is Friday, December 23 when the International Trade Commission announces its preliminary injury decision. If they find no injury at this point, the investigation will be terminated. Unfortunately, at this early stage the commissioners almost always find injury.