SSINA: Chinese steel tests embargo.
For two years now, the Specialty Steel Industry of North America has asked the U.S. government to investigate potential abuses of the embargo, but to no avail.
"Nickel is one of the most important alloys in the production of stainless steel, and our industry is concerned that there is a lot of Cuban nickel in Chinese steel exports to the United States," said attorney Laurence Lasoff of the prominent Washington law firm of Kelley Drye & Warren.
Lasoff represents the Specialty Steel Industry of North America, half of whose 10 member companies are based in Pennsylvania (see box at right) .
"Over 90% of Cuba's nickel production is ultimately exported to China," Lasoff told CubaNews. "We believe China is getting a significant benefit by the fact it can source Cuban nickel and U.S. producers cannot. So we have this dilemma. In order to have some degree of parity here, either we enforce the embargo against Chinese imports, or it's time to remove the embargo so that U.S. stainless steel producers are not put at a disadvantage."
Anywhere from 15% to 25% of American consumption of stainless steel is currently imported, and China consistently ranks as one of the world's top three suppliers to the U.S. market, along with Mexico and Taiwan.
From January to August 2010, according to SSINA statistics, Mexico shipped 55.8 million kg of long and flat stainless-steel products to the United States, or 15.73% of all imported steel. In 2nd place was China, supplying 45.4 million kg, or 12.82% of the total, followed by Taiwan, Germany and Sweden.
"We are concerned. There's a long history of our industry being highly import-sensitive," said Lasoff, noting that China is now getting into the super-alloy market, which has a number of applications in aerospace and defense.
"The embargo regulations make it explicit that not only does it extend to goods of Cuban origin, but also to materials bearing Cuban nickel," Lasoff explained. "In the 1980s, the U.S. banned imports of stainless steel from the Soviet Union because they refused to certify that the product did not contain Cuban nickel."
In testimony submitted earlier this year to the House Ways & Means Committee, SSINA officials demanded to know why the Treasury Department's Office of Foreign Assets Control (OFAC) has not pursued a more aggressive policy against Chinese companies that export stainless steel to the United States.
"Indeed, the U.S. previously entered into bilateral agreements with respect to stainless steel producers in Japan, Italy and France, to ensure that imports from those producers did not contain Cuban nickel," said SSINA Chairman Sunil Widge, who's also senior vice-president at Carpenter Technology in Reading, Pa.
Widge complained that "a failure to enforce the embargo ... places the domestic specialty metals industry at a distinct disadvantage by allowing China to avail itself of the world's largest nickel reserves, while simultaneously denying the U.S. industry the same access."
OFAC spokeswoman Marti Adams did not return phone calls seeking comment.
Details: Larry Lasoff, Kelley Drye & Warren, 3050 K St. NW, Washington, DC 20007. Tel: (202) 342-8530. URL: www.ssina.com.
The following 10 companies are members of the Specialty Steel Industry of North America (SSINA), which wants to investigate U.S. imports of Chinese stainless steel due to potential Cuban nickel content: Allegheny Ludlum (Pittsburgh, PA); ATI Allvac (Monroe, NC); Carpenter Technology (Reading, PA); Electralloy (Oil City, PA); Latrobe Specialty Steel (Latrobe, PA); North American Stainless (Ghent, KY); Outokumpu Stainless (Schaumburg, IL); Talley Metals Technology (Hartsville, SC); Universal Stainless & Alloy Products (Bridgeville, PA), and Valbruna Slater Stainless (Fort Wayne, IN).
2010 2008 Phase One of an expansion project ureases Moa Nickel plant capacity to 37,000 tons per year. Further expansion is tied to market prices and temporarily halted. 2007 Record-high world nickel prices prompt various expansion and development projects involving Chinese, Venezuelan, Australian and Canadian investors. They are later shelved as prices collapse. 2000 After a last effort to finish Las Camariocas project with Russia's Norilsk Nickel failed, the plant is permanently abandoned. 1994 With production at its lowest in 30 years, Sherritt International Corp. joints Cuba's Compania General del Niquel to operate the Pedro Soto plant (renamed Moa Nickel S.A.). 1991 Soviet Union vanishes. Las Camariocas project is halted at 70% completion. 1990 The Ernesto Guevara plant temporarily shuts down to save fuel. 1986 The Ernesto Guevara plant begins operations using 6.5 times more fuel than the old Moa plant. 1903 Construction of a fourth plant starts at Las Camariocas, Moa with capacity of 30,000 tons per year. 1980 1974 The future Ernesto Guevara plant breaks ground at Moa. 1972 Cuba enters the CMEA group of communist economies. 1970 1961 The new plat at Moa, renamed Pedro Soto, begins production. 1960 Cuba's nickel industry is nationalized without compensation. 1957 A new plant built by Freeport Sulphur Co. breaks ground at Moa. 1952 Nicaro restarts during the Korean War. Through 1959 it yields 118,114 tons of nickel oxide. 1950 1947 The pioneering plant at Nicaro is shut down and mothballed after the end of World War II. 1943 Cuba's first nickel plant opens at Nicaro during World War II to supply war metal needs. In five years it delivers 31,300 tons to the United States. 1940 11.2 Production record per decade (in thousands of tons)
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|Date:||Sep 1, 2010|
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