September 6, 2007
A leading copper industry expert has called for the U.S. International Trade Commission to conclude that China has failed to meet its obligations to the World Trade Organisation, and intervene to ensure there is fair competition in the global copper industry.
Warren E. Bartel, Chairman of the US Copper & Brass Fabricators Council, Inc. (CBFC) and Senior Vice-President and Senior Advisor at Luvata testified today before the U.S. International Trade Commission in connection with its investigation on “China: Description of Selected Government Practices and Policies Affecting Decision-Making in the Economy.”
Mr. Bartel gives some background: “China’s copper and brass mills have benefited from subsidies from the Chinese Government for some time. These have provided a tremendous boost to their operations at the expense of U.S. copper and brass mills. At the same time, China has been importing scrap copper, again with Government incentives, to supplement low indigenous copper reserves.”
U.S. copper scrap exports to China in the first half of 2007 were more than 321,000 metric tons, compared to only 214,000 tons in all of 2000. In contrast, the U.S. exported just 1.223 million pounds of copper-based, semi-fabricated products to China in June 2007, in the same month China exported 13.175 million pounds of such products to the U.S. When considered on an annual basis, this yields a discrepancy of 143.42 million pounds*.
Mr. Bartel explains the reasons for his testimony: “I strongly believe that healthy and vibrant brass and copper mills can only be maintained by market forces. This is not currently the case. The imbalances being created by China’s policies are significantly eroding the U.S. copper and brass mill industry and raising important questions about what such a weakening portends for the U.S. economy.
“As China’s subsidized capacity to produce copper based products rises, unfair competition can only be expected to worsen. Increasing capacity will translate into larger quantities of low-priced semi-fabricated exports to both the United States and Europe in the future.
“It is my belief that only by ensuring that all fabricators across the globe compete fairly can the industry as a whole thrive and succeed.”
Formerly known as Outokumpu Copper Products, and acquired from Outokumpu OYJ in 2005 by Nordic Capital, Luvata is the leading international supplier of solutions, services, components and materials in a variety of metals for manufacturing and construction. Luvata’s solutions are used in industries such as power generation, architecture, automotive, transport, medicine, air-conditioning, industrial refrigeration, clothing, consumer products and construction. Employing over 8,700 staff in 19 countries, Luvata works in partnership with customers such as Siemens, Toyota, CERN, Shaaz, and DWD International. Please see www.luvata.com for more information.
About The CBFC:
The CBFC is a trade association whose members manufacture more than 80% of the copper and brass mill products produced in the U.S.