China may file WTO challenge to US steel tariffs of more than 200 percent

China could file a suit at the World Trade Organization against the US decision to impose high tariffs on Chinese steel imports, according to a statement by Ministry of Commerce on Tuesday.

"The difficulties in the iron and steel industry are a result of the international financial crisis. They could only be overcome by stronger coordination among governments and enterprises around the world. Strengthening trade protectionism does not help in finding the resolution to the problem," said the statement.

The US International Trade Commission said on Friday that imports of corrosion-resistant steel from China, India, Italy and South Korea were harming US producers.

It has decided to impose a 209.97 percent anti-dumping tariff and a 39.05 to 241.07 percent anti-subsidy tariff on corrosion-resistant steel imported from the Chinese mainland.

According to the ministry, cold-rolled sheet and galvanized sheet, two major types of corrosion-resistant steel, are of the largest volume among Chinese iron and steel products exported to the United States, accounting for more than half of the total exports.

The tariff increase will force the two products imported from China to completely withdraw from the US market. China's steel industry export interests will suffer a serious impact.

The ministry said that it is going to impose anti-dumping tariffs on carbon steel fastener imported from the European Union starting from Wednesday.

China's iron and steel export to the US, where anti-dumping and anti-subsidy cases are the most frequent, stayed around 1 to 2 million tons from 2009 to 2012, significantly lower than 5.02 million tons in 2008.

"Though China's exported iron and steel are of lower prices than the local products in the US and Europe, they are not of the lowest price among similar imported products and are not sold beneath their production costs. China has no intention to initiate malicious competition in these areas," said Li Xinchuang, president of China Metallurgical Industry Planning and Research Institute.

Li has suggested that Chinese iron and steel smelters should diversify their export destinations to reduce the risks. For instance, exploring emerging markets in Africa, the Middle East, South America and member countries of the Association of Southeast Asian Nations.

According to the statistics of China Iron and Steel Association, China's export to 10 member countries of ASEAN increased from 5 million tons in 2008 to 14.2 million tons in 2010. During the same period, China's exports to the European Union, the United States and Canada decreased by 6.86 million tons.

yangziman@chinadaily.com.cn