Testimony

Linda Andros, Legislative Counsel

UNITED STEELWORKERS (USW)

before the

U.S. INTERNATIONAL TRADE COMMISSION (USITC)

Third Sunset Review Hearing

CERTAIN WELDED PIPE AND TUBE

From Brazil, India, Korea, Mexico, Taiwan, Thailand and Turkey

May 3, 2012
Washington, DC

Good morning, Chairman Okun and members of the Commission.  My name is Linda Andros and I am the Legislative Counsel for the United Steel, Paper and Forestry, Rubber, Manufacturing Energy, Allied Industrial and Service Workers International Union or the USW.  The USW is the largest industrial union in North America with 1.2 million active and retired members.  USW members produce raw materials and industrial products that run the gamut, including the circular welded pipe products at issue.

This case, as every case, is important to the USW.  You have heard from executives of likely the four largest producers of these pipe products in the United States -- Allied, TMK IPSCO, U.S. Steel and Wheatland Tube.  The USW represents them all.  In fact, members working in this industry from Ill and PA are here today.  I’d ask that they stand and be recognized. 

Your staff report shows that there are about 1,500 workers currently in this industry, down from over 2,000 earlier in the relevant period.  Most of the workers who lost those jobs were USW members.  Our members are the workers who also suffered when Wheatland shut down plants in Sharon, Pennsylvania and Little Rock, Arkansas and when Allied shut down a plant in Pine Bluff, Arkansas.  We suffered more job losses when Allied shut down a plant in Morrisville, Pennsylvania in March 2012.

While I understand the Commission must focus on the workers making the pipe covered by in these orders, I’d like to note that we do have USW members also producing the main input – flat-rolled steel – and also members mining iron ore, another critical input, so continuing the orders against the various countries that were found dumping would be very helpful for these members, as well.

Of course, for our members working in the circular welded pipe industry, maintaining the orders on the countries at issue is a matter of grave importance, as it potentially means their very livelihoods.  These plants provide good-paying jobs with benefits and that means that our members have the opportunity to provide a decent standard of living for their families and to contribute positively to their communities.  Some of these plants are in tough urban areas like the Allied plant just outside of Chicago, IL.  Without the plants, it’s fair to say that there would be no comparable jobs for people who live in these areas and no comparable opportunities to enter the middle class and provide for their families with dignity.  

Some of the data from your record are troubling, as they are representative of many problems we see in manufacturing generally and steel pipe in particular.  For example, according to the public record, the U.S. circular welded pipe industry’s share of its own market -- the United States -- is less than two-thirds.  The capacity utilization rate of these pipe mills is only at about 50 percent.  Yet, these are world-class pipe producers.  These pipe mills can operate flat out seven days a week but, unfortunately they are not doing so, even though unlike most of our global competitors, the United States is self-sufficient in iron ore, metallurgical coal and also scrap, three important inputs in producing steel and circular welded pipe.

You  have to wonder in these circumstances how overall imports were able to take one-third of the U.S. market, which caused reductions in shifts and thus reductions in work and outright job losses.  Needless to say, USW members could man those extra shifts.  The hard reality is that the U.S. circular welded pipe industry has been at such significant unused capacity as pipe imports have taken so much market share.

Obviously, we are also concerned with the profitability of the circular welded pipe industry.  At U.S. Steel, for example, profits mean profit-sharing checks to our workers.  No profits mean no profit-sharing checks.  Also, at many of the plants that supply steel to these U.S. pipe producers, such as ArcelorMittal - no profits mean no contributions for retiree health care either.  So when we see that the circular welded pipe industry had only a meager one percent profit margin in 2011 it scares me – we fear for the future of our members and retirees, who devoted a lifetime of hard work.

In fact, you have heard from Mr. Kurasz that his new owners told him that if some of the plants don’t make money, they will be sold or shut down.  In an industry like the circular welded pipe where the industry is averaging just one percent profit margin, it stands to reason there must be plants that aren’t making any profit at all.  So we are very worried.  

From the facts on the public record it seems pretty much common sense that if the orders were to be terminated on the foreign producers at issue, unfairly dumped imports would be very likely to enter the U.S. market and cause harm yet again to U.S. circular pipe producers and workers making these products, including – importantly -- USW members –especially as U.S. mills are already underutilized -- and producers are barely breaking even now.  The result of
increased imports of unfairly traded circular welded pipe from the countries at issue would be just like what happened before the orders were imposed; it would result in harm, as U.S. pipe producers would yet again very likely be forced to cut back on more shifts and shut down more lines or even entire plants.  These actions would be extremely harmful for our members who already have suffered immensely from the dumped pipe imported from these countries.

I am here today on behalf of the USW to say that our workers in the circular welded pipe industry need a fair chance to compete in a fair market – their livelihoods depend upon it.  We urge you to make affirmative determinations in these sunset reviews. 

Thank you.

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