US Steel ‘Guaranteed’ to Stay US-Owned, Biden Tells Steelworkers

(Bloomberg) —

President Joe Biden vowed to keep United States Steel Corp. American-owned and called for higher tariffs on Chinese steel and aluminum as he sought to woo union workers ahead of November’s election.

“US Steel has been an iconic American company for more than a century. And it should remain a totally American company — American-owned, American-operated by American union steelworkers, the best in the world,” Biden told a crowd of union members Wednesday at the headquarters of the United Steelworkers in Pittsburgh.

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“And that’s going to happen, I promise you,” Biden added on the second day of a three-day swing through battleground Pennsylvania.

President Biden Speaks At United Steel Workers Headquarters

The union is strongly against a bid by a Japanese company, Nippon Steel Corp., to acquire US Steel for $14.1 billion, and the president last month ratcheted up his opposition as well.

Ahead of his remarks, a steelworker shouted out to Biden, “Let’s keep US Steel in America!” to which the president responded “guaranteed.” The USW has endorsed Biden, although his Republican rival, Donald Trump, also has support among the group’s rank and file.

“Trump simply doesn’t get it,” Biden said Wednesday. “For years I’ve heard many of my Republican, even Democratic friends say that China’s on the rise and America’s been failing behind. You may have noticed the last two years I’ve been the only one disagreeing with that. I’ve always believed we’ve got it all wrong. America’s rising.”

Shares of US Steel fell 1.3% at 2:50 p.m. in New York, after earlier touching an intraday low of $39.20.

China Tariffs 

The new tariffs Biden is pushing — meant to shore up the American steel sector and court its workers — would impose 25% levies on certain Chinese steel and aluminum products. They would be applied as part of an ongoing review, while the US also launches a formal probe into China’s shipbuilding industry.

But analysts said the steps would have minimal economic impact. Imports of Chinese steel and aluminum totaled roughly $1.7 billion in 2023, a small sliver of the overall market.

“There is effectively no market impact – this is a political statement,” said Colin Hamilton, managing director of commodities research at BMO Capital Markets Ltd, noting that only 2% of steel and 4% of aluminum imports were from China last year.

Still, US officials said the announcements were designed to head off an expected surge and safeguard the US market. The broadside comes as the administration continues its review of Trump-imposed tariffs on China that Biden has largely kept in place.

“Folks, instead of importing foreign products and exporting American jobs, we’re exporting American products and creating American jobs,” Biden said.

The president is calling for raising Section 301 tariffs on a wide range of Chinese steel and aluminum  — namely, products that currently have 0% or 7.5% tariffs should be each raised to 25%. Rates on products already subject to 25% tariffs wouldn’t change.

Kevin Dempsey, president of the American Iron and Steel Institute, said the industry was “very concerned about the recent significant increase in Chinese steel exports to world markets and welcomes President Biden’s actions.”

The final decision would rest with the US Trade Representative, Katherine Tai, and come after the ongoing review of Section 301 tariffs is concluded, an official familiar with the plans said, speaking to reporters on condition of anonymity. The administration hopes to see the results soon, the official said.

The increase in metal tariffs on China comes as imports from the nation for years have been uneconomic for domestic buyers. The combination of current tariffs under Section 301, Trump-era tariffs under Section 232 and other existing anti-dumping and countervailing duties effectively eliminated Chinese imports of steel and aluminum.

Chinese steel imports topped out at nearly 3 million tons in 2014, US Census Bureau data show. But the country accounted for just 600,000 metric tons of steel imports in 2023, for a value of $900 million, out of total US steel imports of 25.6 million tons.

“Chinese steel has been subject to some very high US anti-dumping and countervailing duties for many years now, and what products continue to flow are largely quite niche high-value items like seamless tubes or packaging steels,” said Matthew Watkins, an analyst at CRU.

“I can’t see an increase in tariffs on China making a significant difference to current US steel import patterns,” Watkins added.

Tai’s office will also launch a formal review of China’s maritime, logistics and shipbuilding sector, a probe that a group of five major union groups sought last month.

China’s government called the investigation a mistake “based on the need of domestic politics.”

–With assistance from Jack Ryan and Jacob Gu.

(Updates with additional quotes, background starting in sixth paragraph)

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