Putting up Steel Bars – Dumping, Protectionism Ramp Up for Global Steel
Adam Henige
June 26, 2009
With the Chinese Ministry of Commerce officially launching an investigation into steel dumping by Russian and U.S. companies, the global steel market could be in for some turmoil in the months ahead. At issue at the moment is the MOC´s case against Novolipetsk Steel, who produces one fifth of the world´s transformer steel.
The Russians admit no wrongdoing, but China has continued pushing forward with the investigation. The question, however, is whether this is truly directed at Novolipetsk or a reaction to recent anti-dumping policies being fought for in the U.S. (led by Russian and American companies) against Chinese steel.
President Obama finds himself in an interesting predicament as organized labor, whose vote he courted throughout this past election. Will he back up his aggressive rhetoric both on support for organized labor as well as unfair trade practices against China. This seems to stand in opposition to his pro trade agenda, and the follow through may be telling as to how the future of this administration´s policy will in fact play out. So will global leaders place steel bar, i.e. protectionist strategies, to protect domestic interests?
In many instances, it would seem that global protectionism, surprisingly to many, is gaining momentum. Historically, Europe´s steel industry has been able to use protectionist policies to defend their steel suppliers against lower cost alternatives from places like China. As the EU moves to a more globalized role in the world economy, anti-dumping policies linger, as in the U.S. According to the WTO, in the first half of 2008 43.5% of anti-dumping cases were targeted against China. Undoubtedly, there is a standoff coming in terms of the steel industry across the globe, whether China´s complaints stand up in the face of long protected markets, and the effects of such policy, remains to be seen.
The Russians admit no wrongdoing, but China has continued pushing forward with the investigation. The question, however, is whether this is truly directed at Novolipetsk or a reaction to recent anti-dumping policies being fought for in the U.S. (led by Russian and American companies) against Chinese steel.
President Obama finds himself in an interesting predicament as organized labor, whose vote he courted throughout this past election. Will he back up his aggressive rhetoric both on support for organized labor as well as unfair trade practices against China. This seems to stand in opposition to his pro trade agenda, and the follow through may be telling as to how the future of this administration´s policy will in fact play out. So will global leaders place steel bar, i.e. protectionist strategies, to protect domestic interests?
In many instances, it would seem that global protectionism, surprisingly to many, is gaining momentum. Historically, Europe´s steel industry has been able to use protectionist policies to defend their steel suppliers against lower cost alternatives from places like China. As the EU moves to a more globalized role in the world economy, anti-dumping policies linger, as in the U.S. According to the WTO, in the first half of 2008 43.5% of anti-dumping cases were targeted against China. Undoubtedly, there is a standoff coming in terms of the steel industry across the globe, whether China´s complaints stand up in the face of long protected markets, and the effects of such policy, remains to be seen.