In a recent announcement on October 11, 2024, the U.S. Department of Commerce detailed its preliminary findings concerning countervailable subsidies on certain cold-rolled steel flat products imported from the Republic of Korea. This review, which focuses on the period from January 1, 2022, to December 31, 2022, has identified key players, including Hyundai Steel Company and POSCO/POSCO International Corporation, as the main respondents. The findings suggest that these firms benefited from specific financial contributions that qualify as subsidies, warranting further scrutiny and potential duties.
The review process was initiated on November 15, 2023, following requests for administrative review. The process included examining the financial practices of the mandatory respondents. On May 9, 2024, the Department extended the deadline for preliminary results, indicating the complexities involved in evaluating subsidy claims. By October 4, 2024, the preliminary results were set to be released, shedding light on the financial dynamics within the Korean steel industry.
In this review, the Department is also partially rescinding its administrative review for 45 companies, including those for which no suspended entries of subject merchandise were reported during the review period. This step highlights the importance of verifying actual trade activity when considering countervailing duties. On February 13, 2024, the petitioners, likely U.S. steel producers, withdrew their requests for reviews concerning these companies, thus prompting the Department to limit its inquiry.
The scope of the countervailing duty order encompasses cold-rolled steel products, which are vital for various manufacturing sectors, including automotive and construction. The Department’s methodology for determining subsidy rates involves assessing the financial benefits conferred to the producers by government authorities in Korea. These rates are crucial in establishing a level playing field for U.S. manufacturers, ensuring that imports do not unfairly undercut domestic prices.
Preliminary findings indicate that POSCO/POSCO International Corporation received a subsidy rate of 15.48%, while Hyundai Steel Company’s rate was set at 2.21%. Additionally, KG Dongbu Steel Co., Ltd. was assigned a subsidy rate of 1.73%. These figures represent the percentage of subsidy benefits relative to the value of the merchandise, known as ad valorem rates. Understanding these rates is essential for stakeholders in the steel industry, as they will impact pricing and market dynamics.
The public comment period following these preliminary results invites industry stakeholders to provide feedback and further insights. This step is crucial, as it allows for a more transparent process and ensures that all voices in the steel supply chain are heard. The Department plans to disclose its calculations and methodology, enabling interested parties to understand the basis for the assigned subsidy rates.
