FYI, for meeting w/ McMahon on Monday. Lisa
----- Forwarded by Lisa Yoho/NA/Enron on 03/23/2001 03:13 PM -----

Chris Long
03/22/2001 12:18 PM

To: Lisa Yoho/NA/Enron@Enron
cc:
Subject:

No. 56
Thursday March 22, 2001 Page A-19
ISSN 1523-567X
Regulation, Law & Economics

International Trade
U.S. Steel Producers Make
Concerted Push for Section 201 Case

U.S. steel industry officials appearing before the House Steel Caucus March
21 were unanimous in calling for an investigation under Section 201 of the
1974 Trade Act but some officials warned that any limits on steel imports
must be comprehensive so that circumvention does not occur.
"To be effective, the [import relief] must cover all imports, including
semifinished products," Nucor Corp. Chief Financial Officer Terry Lisenby
urged.
Terrence D. Straub, vice president, government affairs, USX-US Steel Group,
said that the industry needs a sustained period of import stability to
recover from damage and to address structural issues. "The restraints [which
could be imposed under Section 201] should reduce finished steel imports
across the board from non-[North American Free Trade Agreement] countries to
pre-crisis levels, and they should remain in force until the fundamental
structural problems have been successfully addressed," he said. The
restraints must not replace relief under the antidumping and countervailing
duty laws, he said.
Section 201, known as the safeguard statute, allows the president to
temporarily restrict imports of an investigated product if the International
Trade Commission finds that surging imports are a substantial cause of
serious injury to the U.S. industry. U.S. Trade Representative Robert B.
Zoellick has said that the Bush administration is seriously considering a
Section 201 investigation in steel .
The U.S. steel industry was broadsided by an unprecedented import surge in
1998. Imports dropped in 1999 but began rising again in 2000.
George Becker, former president of the United Steel Workers of America,
called for immediate passage of H.R. 808-a bill that would roll back steel
imports for five years. If immediate relief is not provided to the steel
industry, "there will simply be no more steel industry," he said.
Rep. Pete Visclosky (D-Ind.), vice chairman of the caucus and a key sponsor
of H.R. 808, announced that the measure had garnered over 100 cosponsors.
H.R. 808 would also enhance the Steel Loan Guarantee program by providing
cash strapped steel firms with loans.
While expressing support for other provisions of H.R. 808, Nucor's Lisenby
said that inefficient mills should be allowed to go out of production. Nucor
opposes any bail out of legacy costs of these firms or any other type of
subsidies, he said.
Witnesses agreed that world steel overcapacity was a major problem for the
industry. Specialty Steel Industry of North America Chairman H.L. Kephart
warned that foreign steel producers are planning to add 7.4 million tons of
new production capacity in the next five years. "This is three times the
total annual U.S. consumption of stainless steel coming online by 2005," he
said. Since most of this new production cannot be absorbed by foreign
markets, the United States will be targeted for large increases in stainless
steel imports, he said.

By Rossella Brevetti

Copyright , 2001 by The Bureau of National Affairs, Inc., Washington D.C.