U.S. steelmakers go on offensive

August 05, 1993|By New York Times News Service

WASHINGTON -- American steelmakers, stunned by a federal commission's ruling last week that eliminated many tariffs on imported steel and knocked $1.1 billion off the value of their stocks in 90 minutes, began a broad campaign this week to reverse the decision.

Led by major companies such as Bethlehem Steel Corp., LTV Steel Company Inc. and USX Corp., the domestic industry is putting pressure on Congress, the White House and the International Trade Commission.

It wants the commission to vote again on its tariff decisions, is asking the White House to replace a commissioner who voted RTC against the American steelmakers and is urging Congress to review the rulings soon. Steel industry lawyers are also preparing to appeal the rulings to the Court of International Trade, a federal court in New York City.

A dozen American steel companies filed a petition Tuesday night with the International Trade Commission, asking that it vote again next Monday because the companies' stocks have tumbled so drastically.

Late last month, the commission ruled that in 42 of 72 cases the domestic industry had not been hurt significantly by imports and therefore was not entitled to continued protection from a broad range of imported steel used for construction and machinery.

The decision was expected to have an "adverse effect" on Bethlehem Steel's Sparrows Point steel mill if it stands, Curtis H. Barnette, Bethlehem's chairman and chief executive, said at the time.

Citing their slumping stocks, the steelmakers contended in their petition that "the dramatic behavior" of investors on whom the industry depended confirmed "the injurious effects of unfairly traded hot-rolled and cold-rolled imports."

Paula Stern, a former chairwoman of the commission who now advises U.S. manufacturing companies that rely on imported steel, said that in the commission's 77-year history no industry had ever sought such a reconsideration.

Commission officials declined to comment, pending a review of the steel industry's petition.

Sixty House members sent a letter this week to President Clinton requesting a meeting soon and asking that he immediately replace Commissioner Anne E. Brunsdale, who cast the deciding vote in 11 of the 42 cases that the industry lost. Her nine-year term expired June 16, but federal law specifies that a commissioner may serve until a replacement has been nominated by the president and confirmed by the Senate.

Despite aggressive lobbying by the steel industry, no replacement has yet been nominated.

The steel industry is likely to refile these cases once a new commissioner has been named, said Alan W. Wolff, a former deputy U.S. trade representative who is now advising the domestic steel industry. The refilings would constitute new cases, rather than reconsideration of old ones.

A White House official said the administration had taken no position on the ruling by the trade commission, which is independent of the executive branch. But it plans to nominate a replacement to Ms. Brunsdale soon, the official said.

Michelle Galanter Applebaum, a Salomon Bros. steel analyst, said the financial effect of the current maneuvering was unclear, but the U.S. industry would be in trouble if it did not have the rulings overturned.

"No one knows how bad it could get if you have an unlimited supply of imports into a market when most other markets are protected by cultural or legal barriers," she said.

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