US raises tax on Chinese steel imports by 522%

The US commerce authority raised the duty on Chinese steelmakers more than fivefold after accusing them of selling their products below market prices.

Trade tensions have been escalating between the US and China, especially in the steel sector. Both American and European producers claim China has distorted world pricing by dumping excess output abroad as demand at home slows.

The new regulation came after five major US steel producers – United States Steel, AK Steel Corp, ArcelorMittal USA, Nucor Corp and Steel Dynamics Inc – filed a formal trade action in 2015, alleging foreign companies were selling steel at unfairly low prices. The companies claimed they had been forced to lay off 12,000 steel workers over the past year as a result.

The US Commerce Department found that Chinese companies were selling their excess steel output in the US market below cost with unfair subsidies.

The Commerce Department set final anti-dumping duties of 266% – and anti-subsidy duties of 256% – on cold-rolled flat steel from China. It also levied a 71% import tax on Japanese cold-rolled steel.

According to Reuters news agency, the import prices of Chinese-made cold-rolled flat steel products that are widely used in car manufacturing had totaled $272.3 million in 2015.

China called the fivefold increase of duty unfair, expressing strong dissatisfaction with the ruling.

China's Ministry of Finance said it would support steel exporters.

The ministry will continue to implement a tax rebate policy on steel exports, it said, adding that the ministry tries to finance a costly capacity closure plan.

The ministry said China was making special funds available to curb overcapacity in both the steel and coal sectors, and would reward local authorities for exceeding their targets and meeting them early.