Steel Dynamics Comments On Department Of Commerce Preliminary Determination Regarding Corrosion-Resistant Flat Roll Steel Imports

Steel Dynamics, Inc. (NASDAQ/GS: STLD) commented that the company is very pleased with yesterday's announcement by the Department of Commerce (DOC) concerning preliminary countervailing duties against imports of corrosion-resistant steel from China and also accepting of the findings related to India and Italy. The company had anticipated minimal results for Taiwan and Korea. The company produces corrosion-resistant steel including hot-dipped galvanized, Galvalume(R), and painted steel at two facilities located in Indiana, one facility located in Mississippi and three facilities located in Pennsylvania. Steel Dynamics is the largest non-automotive producer of galvanized flat roll steel in the United States. The product is used in many construction applications, automotive parts and numerous consumer products. The DOC found subsidy rates ranging from 26% to 236% against imports from China, the biggest source of corrosion-resistant steel imports into the United States in 2014. The Chinese companies with 236% duties will also have these duties applied retroactively by 90 days because of a preliminary affirmative critical circumstances finding by the DOC as the result of recent import surges from China. Imports from India, the third largest source of U.S. corrosion-resistant steel imports in 2014, were subjected to subsidy findings of 2.85% to 7.7%. One of the largest Italian producers was given a subsidy rate of 38.4% and was also subject to retroactive duty assessment under critical circumstances. Not unexpected, Korea, the fourth largest source of corrosion-resistant steel imports in 2014, was given negligible subsidy findings and Taiwan, the second largest, received no subsidy findings. The DOC will finalize its subsidy findings by the end of January 2016, unless the petitioners request an alignment of the subsidy final determinations with final antidumping duty determinations. That decision has not yet been made. The DOC will issue preliminary antidumping determinations against these same five countries on December 22, 2015. On Friday, October 30, the Department made preliminary critical circumstances findings based upon import surges from China, Korea and Taiwan. Total 2014 corrosion-resistant flat roll steel imports from these five countries were $2.2 billion, representing more than 50% of total 2014 corrosion-resistant steel imports. For these duties to eventually go into effect, the International Trade Commission will need to make affirmative determinations of injury or threat of injury in 2016.