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 In the letter published on Monday, the United States gave Russia 60
days notice of the termination and said anti-dumping duties would
then apply.
The so-called suspension agreement has sheltered Russian steelmakers
from anti-dumping duties as high as 184.56 percent on hot-rolled,
flat-rolled, carbon quality steel, instead setting a cap on imports
and a minimum price.
Duties will apply beginning Dec. 16, according to the letter from
Ronald K. Lorentzen, the Commerce Department's deputy assistant
secretary for enforcement and compliance, to Russia's economic
development ministry.
Severstal <CHMF.MM>, one of Russia’s top steel producers, blasted
the proposed move. It claimed there was “no objective reason” for it
because the price of hot-rolled coil in the U.S. market has actually
risen this year and it indicated it might appeal the decision to
“defend our interests.”
A spokesman for the Russian ministry told Reuters his office had
received the formal notice and was studying the issue.
The United States has intensified sanctions against Russia over its
intervention in Ukraine in recent months, moving from travel bans
and asset freezes for officials to targeting Russia's largest bank
and oil companies.
U.S. steel producers complained to Commerce in July that the 1999
agreement had not stopped Russian producers from undercutting local
prices or flooding the U.S. market.
Nucor Corp <NUE.N>, U.S. Steel Corp <X.N>, ArcelorMittal USA LLC [ARCMTR.UL]
and other companies said the reference price set in the agreement,
which also set a cap on imports, had been below U.S. market prices
since 2004.
"The deal did not comply with the legal requirements and obviously
the policy parameters have changed so there was no reason to give
Russia any special treatment," said Alan Price, an attorney from
Wiley Rein representing Nucor Corp.
Spokeswomen at Nucor and US Steel did not immediately respond to
requests for comment on the ruling.
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Severstal now faces anti-dumping duties of 73.59 percent. Other
Russian producers, such as Novolipetsk Steel and Magnitogorsk Iron
and Steel Works, face duties of 184.56 percent.
Cowen and Company analysts said the move might help to stabilize
hot-rolled coil prices, which had been falling in recent weeks.
The American Iron and Steel Institute (AISI) welcomed the decision
and said the agreement was no longer working.
"Our industry should not have to endure injury from surging imports
of Russian hot-rolled steel that are coming into this country under
a deal that no longer serves its intended purpose," AISI President
Thomas J. Gibson said.
Flat-rolled steel comes in rolls or sheets and is commonly used for
purposes such as car bodies, roofing, construction and consumer
appliances.
(Reporting by Krista Hughes in Washington, DC, Andrey Kuzmin in
Moscow and James Kelleher in Chicago Editing by W Simon, J Benkoe,
Marguerita Choy and David Gregorio)
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