President-elect Donald Trump's nominee for commerce secretary, Wilbur Ross, Wednesday said he planned to use the department's ability to self-initiate antidumping and countervailing duty investigations to send a message to foreign manufacturers -- a proactive stance that steel industry executives have long encouraged.
"I like the idea of occasionally using self-initiation by the Department of Commerce to bring these cases," Ross said at his televised confirmation hearing. "We're not going to self-initiate every case. We don't have the staffing to do it, but I think by picking strategic cases and initiating cases them it will ... send a message to the other side that we're getting more serious about this. Second, it would definitely accelerate the process."
Ross, 79, is an investor known helping to restructure companies, including steel companies, and has operated businesses in 23 countries.
At the hearing, Ross called himself "an activist," and said self-initiating antidumping and countervailing duty investigations would help small companies that have a harder time gathering the funding and data to bring forth a case. Self-initiating trade cases would send a message that the US government will more aggressively combat cheaters.
Antidumping and countervailing duty investigations have been a trade tool frequently utilized by the US steel industry. Senator Gary Peters, Democrat-Michigan, asked Ross about his willingness to self-initiate antidumping and countervailing duty investigations. Peters said the last self-initiated antidumping case may have been in the 1990s. President Reagan in 1985 ordered Commerce to self-initiate an antidumping investigation on Japanese semiconductor imports.
Typically, US manufacturers petition for antidumping and countervailing duty investigations to Commerce and the International Trade Commission. After the petition filing, the statutory timeline for countervailing duty investigations can last 205-300 days, while antidumping investigations may take 280-420 days, according to the ITC.
Of the 65 antidumping and countervailing duty investigations Commerce initiated in 2015, 46 or 71% were for steel products, according to analysis of Commerce data. In 2016, Commerce initiated 48 antidumping and countervailing duty investigations, of which 25 or 52% were for steel. Aside from steel products, US companies have petitioned for duties on ferrovanadium, paper products, wood products, chemicals, residential washers and truck and bus tires.
Ross Wednesday also said Commerce self-initiating trade cases could cut the amount of preparatory time needed to bring forward a trade case, but he would also seek to litigate trade cases faster.
"Historically, the people who have been the dumpers refuse to not comply on a timely basis with requests for information," he said. "If confirmed, I would not look very kindly on the perpetrators deliberately delaying cases by not providing information."
Ross said he would welcome additional resources to be able to assign more people to work on trade remedy actions.
Thomas Sneeringer, president of the Committee to Support US Trade Laws, said that's one reason why trade cases take so long.
"Some of the delays could be avoided if there were enough people to work on the cases on a real-time basis," Sneeringer told S&P Global Platts. Sneeringer thought US trade law enforcement agencies will gain the budget to support enhanced efforts, he added.
Steel mills and market sources have been supportive of Ross' nomination.
"AISI is encouraged by Secretary-designate Ross' clear focus on the challenges that the steel industry is facing, and his intent to use all of the tools at his disposal to ensure a level playing field," Tom Gibson, president and CEO of the American Iron and Steel Institute, said in a statement. "This includes his recognition of the utility of self-initiating cases where appropriate, in addition to his commitment to accelerate all cases. We strongly support his nomination and look forward to his swift confirmation as Secretary."
