As US President Donald Trump prepares to slap stiff tariffs on imported steel and aluminium products, New Zealand Commerce Minister Kris Faafoi has rejected New Zealand Steel's bid for similar protection.
The local steelmaker had applied to have anti-dumping duties imposed on imported Chinese and Malaysian steel reinforcing bar and coil, but Faafoi said the products have minimal government subsidies and aren't being dumped on the local market.
Faafoi chose not to impose anti-dumping duties, and separately found Chinese subsidies on those products to be at "de minimis levels" meaning they weren't causing material injury to domestic rivals. The March 3 decisions were published in the government's New Zealand Gazette today.
New Zealand Steel general manager John Nolan said the company was "very disappointed" with the investigation and Minister’s decision, saying all it wanted was a level playing field and a fair trade environment.
"The findings are out of line with those of other similar jurisdictions (eg Canada, Australia, Europe and the US)," the company said. "We back ourselves to compete with anyone... But we will continue to object to unfairly traded goods, from anywhere."
He didn't say whether NZ Steel will appeal the decision.
The Ministry of Business, Innovation and Employment started investigating the products after getting an application from Australian-owned New Zealand Steel last year with enough evidence to warrant a probe. The ministry's early work found no grounds to impose provisional measures, which needed "reasonable cause" to believe Chinese subsidies were causing material injury to local industry.
MBIE's preliminary investigation reports said it needed "to establish to a higher standard of proof that dumped imports are causing material injury" before it would recommend imposing duties.
The application was NZ Steel's second. The company, which is owned by ASX-listed BlueScope Steel, last year sought to have duties imposed on Chinese imports of galvanised steel. Former Commerce Minister Jacqui Dean, on advice from MBIE, turned down that application, which NZ Steel is appealing via a judicial review in the High Court.
MBIE's final report into the earlier complaint found Chinese imports were undercutting NZ Steel prices, but that it couldn't be blamed on government support for Chinese manufacturers, which was minimal at most.
Chinese steel exports have been a bone of contention around the world, with US and European producers saying that subsidies and overproduction were undercutting their local industries. Last week US President Donald Trump announced plans to impose a 25 percent tariff on imported steel in an effort to support American industry and deliver on his Make America Great Again rhetoric during his 2016 presidential campaign.
Trump could sign off on his tariffs as early as tomorrow, despite more than 100 Republican lawmakers saying urging him to drop the plans. US commentators say steel tariffs introduced under George W. Bush in 2002 were a disaster, sparking retaliation from trading partners in the EU and Japan, and having a serious impact on American companies which relied on imported steel.