Steelmakers, union object to WTO ruling against steel tariffs

The World Trade Organization has ruled that the United States violated trade rules by imposing steel and aluminum tariffs of 25% across the board in 2018.

Steelmakers and the United Steelworkers union decried the ruling against the duties, which were imposed by the Trump administration on the argument they were justified on the grounds of national security, to preserve the steelmaking capacity that supplies plate and other steel products used for defense purposes.

"Making steel in America is critical to our national and economic security, and U. S. Steel commends the Biden Administration for strongly defending American steelmaking at the World Trade Organization. U.S. courts have repeatedly upheld the Section 232 statute and the Section 232 steel action," U.S. Steel said in a statement. "The World Trade Organization should not get to decide U.S. national security policy. We are confident that this World Trade Organization opinion will not affect the Section 232 policy, and it will remain in place. "

The blanket tariffs impose an extra 25% cost on steel and aluminum imports into the United States. They were imposed at a time when foreign imports were gaining market share and caused steel prices to soar to record highs.

The price of steel has since fallen back to earth as the economy cooled.

The U.S. steel industry argues that the tariffs are still needed amid a glut of global steelmaking overcapacity.

"A WTO dispute panel has once again gone beyond its mandate. Each member of the WTO has the right to determine what action it considers necessary to protect its own national security and today's panel ruling disregards this central feature of the WTO system," American Iron and Steel Institute President and CEO Kevin Dempsey said. "The tariffs and quotas on steel were instituted by the president following a determination by the secretary of commerce that high levels of steel imports and continuing global excess capacity in steel threatened to impair U.S. national security as defined in section 232 of the Trade Expansion Act of 1962. The WTO has no authority to second guess the U.S. government on matters of our national security. This decision highlights once again why significant and systemic reform of the WTO dispute settlement system is essential to ensure that all WTO members' rights are fully protected."

The United States can block the WTO ruling by vetoing it as a member state.

United Steelworkers International President Tom Conway argued trade protections are still needed to preserve good-paying American steelworker jobs.

"Over many years, the WTO sought to restrain the use of U.S. trade law and impose obligations we never negotiated. Now, once again, the WTO overstepped its mandate and authorities. The United States was right to ensure that we could meet our national security and critical infrastructure needs in steel and aluminum with domestic production. But instead, the WTO is trying to tell America how we can protect ourselves," he said.

The United States has since worked out quota agreements with some of its biggest trade partners. But the tariffs otherwise remain in place and prevent dumping of steel in the United States, Alliance for American Manufacturing President Scott Paul said.

"A thriving domestic steel sector is essential to national security. The long-term trends of high volumes of imports and subpar capacity utilization erode the capabilities and competitiveness of American steel. That's why the Section 232 action taken under the last administration was fully justified, and why the Biden administration must vigorously defend it," he said.