Export pipe producer benefiting from Trump trade policies, president says
Aggressive trade policies by the Trump administration are starting to have a positive impact on domestic steel pipe producers, said the head of an Export-based company.
Dura-Bond Industries is better positioned to compete for oil and gas industry projects requiring large-diameter welded pipe under tariffs imposed this year, said Jason Norris, company president.
“In general, we support President Trump’s efforts to try and negotiate better trade deals with our trading partners,” Norris said. “We are very optimistic that trade issues will be sorted out and there will be a more-level playing field in the future.”
Dura-Bond was part of a small group of pipe producers that petitioned the Trump administration this year to impose tariffs and take other actions to end the glut of foreign steel. Specifically, Dura-Bond asked that steel pipe be included in the 25 percent tariff on imported steel and the 10 percent tariff on imported aluminum announced in March.
Under the new tariffs, U.S. companies are allowed to seek exemptions if domestic companies do not make metals needed for their projects or if those metals can’t be produced to the desired quality or quantity or within a specific timeframe.
The steel tariff is starting to have its desired effect, Norris said.
“Companies are more willing to come in and evaluate us after the reduction in supply from foreign mills,” he said.
Dura-Bond makes and coats large-diameter steel pipe mostly for use by the oil and gas industry at facilities in Export, Duquesne, McKeesport and Steelton.
In late 2016, Dura-Bond acquired the idled assets of the U.S. Steel McKeesport Tubular Operations in order to repurpose it for the manufacture of smaller, midstream pipe. The plant is fully operational now that it has received an American Petroleum Institute certificate covering diameters from 8 5 ⁄ 8 inches to 20 inches, Norris said.
“As a startup mill in McKeesport, I do not think we would have the opportunities we have had (without the Trump policy),” Norris said. “We are moving forward with large investments in the mill to improve efficiency and to stay ahead of the ever-increasing quality standards that the market demands.”
Trump’s tariffs have prompted hundreds of waiver requests from U.S. companies claiming that the steel product they need is not available domestically. The U.S. Commerce Department recently approved such tariff exclusions for Shell and Chevron.
The Commerce Department, however, denied a waiver for the Houston-based Plains All American Pipeline LP, which is building the Cactus II crude oil pipeline — a $1.1 billion project being built in West Texas — with pipe from Greece. Dura-Bond and two other pipeline producers objected to the waiver request.
Plains All American stated in its request that 26-inch diameter pipe is not available in the United States, but Dura-Bond manufactures 26-inch pipe at its plant in Steelton, Norris said.
This week, the Commerce Department revealed that of 26,400 exclusion requests submitted, 267 have been approved, 452 were denied and 3,385 were rejected for being improperly completed, Reuters reported .
The American Petroleum Institute, a national trade association representing the oil and gas industry, on warned Tuesday that denying tariff exclusions for imported steel could negatively impact the U.S. natural gas and oil industry and affordable energy available to consumers.
“The administration’s decision-making is not serving the interests of energy consumers and American businesses, as these tariffs are expected to increase the cost of sourcing steel for the oil and natural gas companies, which in turn could increase the cost of energy to consumers,” said Marty Durbin, API’s executive vice president. “This is not the way to achieve the administration’s commendable goal of U.S. energy dominance.”
API appeared to react to the Plains All American denial without actually naming the company.
Dura-Bond also recently received a favorable ruling from the Commerce Department in its antidumping/countervailing duty complaints against China, India, South Korea and Turkey.
Producers from those countries are accused of “dumping” steel pipe — that is, selling the product at less than fair market value — in the United States and of receiving unfair subsidies from foreign governments.
In February, Dura-Bond and four other producers asked the Commerce Department to investigate the four countries, as well as Greece and Canada, and to take action in the form of antidumping duties.
In June, the Commerce Department issued a preliminary ruling against the countries, asking U.S. Customs and Border Protection to levy duties to offset the negative effects of the subsidies. A final ruling is expected by Nov. 6.
A preliminary ruling on the companion antidumping complaint is expected by Aug. 20, Norris said.
Stephen Huba is a Tribune-Review staff writer. You can contact Stephen at 724-850-1280, firstname.lastname@example.org or via Twitter @shuba_trib.