US steel consuming industries have warned they will suffer from new US steel import tariffs.
President Bush announced on March 5th he would impose steep protective "Section 201" tariffs of eight to 30 per cent on imports of steel to protect ailing US steel makers.
Foreign steel producers from Europe to Japan and South Korea have condemned the tariffs, and US consumers such as car manufacturers say they will also suffer from higher prices for a key raw material.
"We believe that the tariffs will have a devastating impact on steel prices for individual steel consumers," said American Institute for International Steel (AIIS) chairman Mr Wilfried von Bulow.
Mr Bulow said: "Even these tariff levels will not save the weak companies". He said steel makers had argued a 40 per cent tariff would lead to a price rise of 8 to 9 per cent.
Steel prices had begun increasing in early 2002 as domestic shutdowns began to impact supply, and demand improved slightly, reversing a price-cutting war in a weak market, he said.
The real solution to the steel import problem, Mr Bulow said, was to eliminate excess capacity around the world and eliminate trade-distortions such as subsidies.
"Without subsidies, many of the weak US mills would have been shut down, eliminating the inefficient capacity and saving the efficient via the bankruptcy process," he said.
AFP