U.S. Department of Commerce Finds That Chinese Producers of Oil Country Tubular Goods Are Dumping at Substantial Margins

On April 9, 2010, the United States Department of Commerce issued its final determination in its investigation into whether Chinese producers of oil country tubular goods (OCTG) were being dumped into the U.S. market.  In its final determination, the Department found that Chinese OCTG producers are dumping OCTG into the U.S. market at margins of between 30 and 99 percent.

The case was brought by seven domestic OCTG producers, United States Steel Corporation, Maverick Tube Corporation, V&M Star LP, V&M Tubular Corporation of America, TMK IPSCO, Evraz Rocky Mountain Steel and Wheatland Tube Corporation, as well as the United Steel Workers Union.  The case alleged that dumped and illegally subsidized OCTG imports from China had materially injured and threatened the U.S. industry with further injury.

Prior to today’s determination, the Department of Commerce determined that Chinese OCTG producers also received illegal subsidies in the amount of 10 to 16 percent of the value of the product.  In January of 2010, the U.S. International Trade Commission determined that the illegally subsidized OCTG from China threatened the U.S. industry with material injury.

Today’s determination by the Department establishes the final dumping margins in the antidumping phase of the investigation.  This determination revises the Department’s earlier preliminary determination, in which the Department preliminarily calculated a 0.0 percent dumping margin for one of the mandatory Chinese respondents.  In the final phase of its investigation the Department found that the Chinese respondent’s preliminary margin was based on fraudulent documents provided to the Department during the course of the investigation.  As a result, the Department assigned the respondent an adverse final dumping margin of 99 percent.

Alan Price, head of Wiley Rein’s International Trade Practice and counsel to Maverick Tube Corporation, and one of the petitioners in this case, stated that, “We are pleased by the Department’s final determination, which confirms the substantial dumping by the Chinese producers.”  He went on to state that “We believe that this determination also sends a clear signal that manipulation of documents in an attempt to shop for the most advantageous facts will not be tolerated.”

Collection of cash deposits in the amount of the antidumping duty margins will begin when the U.S. International Trade Commission issues an affirmative injury determination, which is expected in early May of this year.