Steel Industry Reaction Mostly Favorable

Several steel company executives have offered their views on the Bush Administration’s Section 201 tariffs, and most comments are favorable.

“This president is a leader who keeps his word,” states Dan DiMicco, CEO of Nucor Corp., Charlotte, N.C. “He has acted to correct the injustices perpetrated on this industry, our workers, and our communities.”

Nucor, an electric arc furnace (EAF) mini-mill operator, is likely to benefit from the tariffs in some of the segments in which it operates. The company is also not considered to be burdened with the “legacy” (pension and retiree health care) costs that integrated steelmakers were hoping would be addressed by the 201 remedies.

EAF steelmaker IPSCO Inc., Regina, Sask., Canada, was doubly pleased by the remedies, because the tariffs should help the company enhance its profit margins in some segments, and because Canadian (as well as Mexican) products were exempted from the tariffs. “This decision, particularly if coupled with Canadian vigilance against offshore imports, will allow IPSCO to continue [to be] a long-term viable supplier to the North American industry,” says IPSCO president and CEO David Sutherland.

An IPSCO release also notes that the exclusion of tariffs against NAFTA partners Canada and Mexico means the Bush Administration, “recognizes the integrated nature of these steel markets,” and, “will allow the movement of steel between Canada and the U.S. to continue within normal trading patterns.”

Several integrated steelmakers also expressed hopes that the tariffs would help them return to profitability. “In the face of strong and vocal opposition, President Bush did what was right,” says James G. Bradley, President and CEO of Wheeling-Pittsburgh Steel Corp., Wheeling, W. Va., in reference to the 18 percent to 30 percent tariffs.

The issue of global steelmaking overcapacity has yet to be addressed though, according to Bradley, nor has the drive for domestic steelmaking consolidation. “For the long-term health of the domestic steel industry, these issues will need to be addressed,” says Bradley.

Bethlehem Steel Corp., Bethlehem, Pa., is an integrated steelmaker working to emerge from bankruptcy. Company CEO Robert “Steve” Miller released a statement thanking “the entire Bush Administration for realizing the critical role that a strong domestic steel industry can and will play as a basic building block of both our national economy and our national security.”