US announces anti-subsidy duties on steel from Mexico and China

US announces anti-subsidy duties on steel from Mexico and China

A month after sparking trade war fears by threatening tariffs on all Mexican exports, the US on Monday night fuelled tensions with its trade partners by announcing preliminary duties on imports of fabricated structural steel from Mexico and China it regards as unfairly subsidised. 

“Commerce will instruct US Customs and Border Protection to collect cash deposits from importers of FSS from China and Mexico,” the Department of Commerce said in a statement. It said a similar investigation into imports from Canada did not find FSS exports were unfairly subsidised to an extent that warrants new duties.

It was not immediately clear what impact the measures would have and the Mexican Steel Chamber could not be reached for comment.

The duties follow investigations which the DoC said allowed US business “to seek relief from the market-distorting effects caused by unfair subsidisation of imports into the US, establishing an opportunity to compete on a level playing field”. In 2018, FSS imports from China were valued at $897.5m and those from Mexico at $622.4m, the DoC said.

The investigation was at the behest of the American Institute of Steel Construction and began on January 4 this year. A final decision is due on or around November 19 this year.

Mexico’s economy ministry said in response that “these anti-subsidy duties have no relation whatsoever with the duties imposed on steel and aluminium under Section 232 which refers to US national security”. That referred to the duties previously imposed on Mexico and Canada, US partners in the Nafta free-trade pact and its successor USMCA, which has yet to enter into force. The duties, which were lifted on May 20, had triggered retaliatory action from Mexico.

“They also have nothing to do with the threat to impose tariffs on all Mexican exports to the US announced by President Donald Trump on May 30,” the ministry added. Mexico would continue to “participate actively” in anti-dumping procedures, the ministry said.

Mr Trump triggered panic in Mexico in May by threatening all Mexican exports with a schedule of rising tariffs unless the government of President Andrés Manuel López Obrador did more to curb the flow of migrants through its territory. 

Under a deal reached in early June, Mexico has until July 22 to satisfy Mr Trump with its progress and is confident it will do so after tripling migrant detentions in June to 29,153 compared with June 2018.

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