The US Commerce Department may start a formal investigation concerning Chinese steel imported into the United States. The step seems to be taken in response to a warning issued by four major steel producing firms in the United States. The main issue relates to the steel imports routed through Vietnam.

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According to The Wall Street Journal, US steel manufacturers are concerned about Chinese steel flooding the market. They have also raised the allegation that China routes its steel through Vietnam, where the steel is subjected to some changes and consequently is regarded as Vietnamese steel. Such steel attracts lower tariffs when it arrives in the United States.

The department has received a letter written by lawyers representing some US-based steel manufacturers claiming that changes made to steel in Vietnam are too insignificant. The letter also stated that steel processing carried out in Vietnam does not add any component or mass.

The US government has already levied high tariff charges of up to 266 percent last year. The tariff is applicable to minimum four new categories of steel from China. The country also proposed duties ranging between 63.86 percent and 76.64 percent as the preliminary studies showed that the steel was getting dumped in the US market at less than fair value. US suspects that Chinese steel companies have started diverting their steel through Vietnam to avoid these duties.

The US Commerce Department's move has been criticized by several companies. Minmetals, Inc., a steel trading company based in New Jersey, said that coating amount to substantial transformation of steel. The four companies filing petition against Chinese steel are U.S. Steel Corp., NucorCorp.,  AK Steel Holding Corp. and  ArcelorMittal.

TagsUS Commerce Department, Vietnam, ArcelorMittal