Testimony Presented

Tom Conway, International Vice President (Administration) United Steelworkers (USW)

Final Hearing - Seamless Standard, Line and Pressure Pipe from China

September 14, 2010, 9:30 AM
U.S. International Trade Commission (ITC)

Good morning Chairman Okun and members of the Commission.  I am Tom Conway, the International Vice President of the United Steel, Paper and Forestry, Lumber, Manufacturing, Energy, Allied Industrial and Service Workers International Union -- the USW.  

I am here today on behalf of USW members who produce the seamless pipe products subject to these investigations at US Steel plants in Lorain, Ohio and Fairfield, Alabama, and at the TMK IPSCO plants in Ambridge and Koppel, Pennsylvania.  And for those members and for all the members of the USW, I want to state clearly that we can beat the import competition from any country so long as the competition is fair.   USW members work very hard and play by the rules; they expect others to do so, and if not, they expect our government to make them by enforcing the trade rules.  

Once again, the fate of USW members rests with the enforcement of our trade remedy laws.   As the largest industrial union in North America, the USW continually takes the brunt of deliberate Chinese government policies that are not based on market principles and signals but rather on a model of state capitalism grounded in strategic goals for achieving market share in export markets and in ensuring that it is creating jobs for its population.  

As petitioners in many CVD cases against China, including the case at hand on seamless pipe products, my members know first-hand the terrible effect of this anticompetitive model in action.  For example, in the recent CVD investigation of Oil Country Tubular Goods (OCTG), with which the Commission is familiar, the volume of imports from China tripled from 2006-2008 -- an incredible surge that continued even well into the severe economic recession.  During that latter period, 2,400 jobs were lost in the industry and hours worked were cut in half.   

The result is all too familiar, but nonetheless quite devastating to my members who suffer the consequences of the damage which happens when a flood of subsidized and dumped Chinese imports hit our shores in wave after wave.  This is even more devastating when the nation is facing an unemployment rate hovering at 10 percent in a national economy still struggling to regain its footing.  Not only have our members had to withstand the most severe economic contraction since the Great Depression – with the loss of 2.2 million manufacturing jobs since its start in December 2007 -- but in industry after industry we are being hammered by the negative impact of deliberate Chinese industrial policies, which have caused real harm to critical sectors of our industrial base, such as the seamless pipe sector subject to these investigations. 

With regard to the seamless pipe products under investigation from China, respondents benefit from a variety of subsidies, in particular State-Owned Enterprises like Baoshan, Tianjin Pipe Company, Hengyang and Valin.   This has let them flood our market with dumped imports that undersell our domestic producers.  We cannot (and should not) be expected to compete against such unfair import competition; it cannot be done no matter how hard we work and no matter how great the productivity gains.

While the Commission cannot broadly solve the nation’s unemployment problem, based on the evidence in this case, you can render an appropriate ruling -- that unfairly-traded imports of seamless pipe from China have injured, or threaten to injure, U.S. producers of the seamless pipe products under investigation and their workers.  Such a ruling would make a tremendous difference in the lives of USW members working in this industry and to the health of our economy.  Consider your affirmative determination in the recent OCTG case. 

Based on the Commission’s decision, workers in the OCTG industry and in flat-rolled mills that supply steel to OCTG producers were able to return to work.  To give just one example, US Steel reopened the former Lone Star mills in Texas and also the Granite City plant, which supplies hot-rolled steel to the Lone Star facilities.  Moreover, as you are aware, every steel job supports additional jobs in the communities where the plants are located.  It is no exaggeration to state that many, many men and women are at work today, all across America, because of the affirmative ruling in the OCTG investigation.

Yet unfortunately this is not the end of it.  There are more jobs at risk due to unfairly-traded imports of seamless standard, line, and pressure pipe.  These products are made on the same equipment and at the same kind of mills that Chinese producers use to make seamless OCTG.  The Chinese shipped almost 2.4 million tons of seamless OCTG to this market in 2008 and 2009.  With antidumping and countervailing duty orders now in place on OCTG from China, the temptation exists – and a tremendous economic incentive – to flood this market with seamless pipe products ,which in the OCTG case literally shut down the majority of our industry.  USW members producing seamless pipe products know only too well what that will mean:  more lost jobs, more lost hours, more suffering, more people forced to scramble for work in a poor economy, more people asking why they have to lose their jobs because of unfair Chinese policies. 

There can be no serious doubt that the same Chinese industry that flooded this market with OCTG and seamless pipe in 2008 would not resort to that same vast capacity – now with far fewer alternative outlets – to unleash that capacity on our seamless producers and my members.  Certainly, this presents a clear threat of injury from imports under the trade remedy laws.

Finally, I understand that Chinese respondents may claim that the domestic industry has not suffered material injury.  You should reject any such argument.  The domestic industry includes those who work in that industry and those workers have suffered terribly.  This industry was practically shut down for much of last year.

Hundreds of people lost their jobs.  Imagine being out of work for months at a time and the economic and emotional strain that puts on those working men and women and their families and communities.  That's what happened to many workers in this industry.  And let me  emphasize that all of this suffering occurs – not because of anything our workers or domestic producers have done wrong – but because of deliberate, mercantilist policies in China.  I urge the Commission to grant our workers and this industry the relief they need.  Thank-you.