Impact won't be severe in Valley

Democratic and GOP lawmakers both said the repeal came too soon.
By CYNTHIA VINARSKY
VINDICATOR BUSINESS WRITER
A weak dollar, a growing economy and a strong order book give WCI Steel officials confidence that the Warren steelmaker won't be badly hurt by President Bush's decision to repeal the steel tariffs.
At least not any time soon.
"We feel in the short term that removing the tariffs won't have any serious impact on WCI or the domestic steel industry," said Tim Roberts, a spokesman for the Mahoning Valley's largest steelmaker.
"The dollar is weak, and that's a disincentive to imports. The economy is improving. The demand for steel is good, and our order book is very strong," he said.
China is another major factor. Roberts said the giant Asian country has become an "extraordinary consumer of steel" and is snatching up all the excess foreign steel that formerly was being sold at cheap prices in the United States.
Steel is a cyclical industry, however, and Roberts said the import problem could show its ugly head again in the future. "We do hope the administration will quickly respond to any future import surges," he said.
Bush's plan, when the tariffs were established in 2002, included two other facets: federal officials were to negotiate with other countries to eliminate government subsidizing of steel mills, and to close old inefficient mills.
"We hope the administration will aggressively pursue those," Roberts said, "but with the tariffs gone, what are the incentives?"
A bigger risk for investors
Michael Rubicz, president of United Steelworkers of America Local 1375, which represents workers at WCI and several other Valley steel mills, said the tariffs provided some security for steel mill investors. Without them, he said, anyone investing in steel is taking a bigger risk.
That's significant for WCI, which needs additional financing as it works to emerge from Chapter 11 bankruptcy protection.
"The tariffs gave investors a certain guarantee that any imports would have to pay duties so there won't be a flood of imports coming in," Rubicz said. "Now its uncertainty. It's one more log on the fire, that's all. I feel a lot of people lost respect for Bush because of the way he handled this. He caved in to foreign pressure."
Wheatland Tube
The tariffs never had much of an impact on Wheatland Tube, so officials there aren't too concerned about the repeal, said Bill Kerins, vice president of operations. With three local plants in Sharon, Wheatland, Pa., and Warren, the steelmaker is another large local employer, with more than 1,300 workers.
"The tariffs did succeed in one way by contributing to the reorganization and restructuring of the domestic steel supplier base," Kerins said, "but we were disappointed that they did not reduce the flow of imported pipe into the United States."
Kerins said he's heard about Bush's plan to improve monitoring of illegal steel dumping and hopes it will benefit the tube maker. Imported pipe now controls about 60 percent of the standard pipe market, he said.
Legislators
Republican Sen. George Voinovich said he gives Bush credit for coming to steel's "rescue" by initiating the tariffs, but he's disappointed about the decision to repeal them "just as they've begun to work."
Voinovich said he'll push for continuation of the Steel Loan Guarantee program and hopes the Bush administration will offer other ideas to help stabilize the steel industry.
Congressman Ted Strickland issued a statement criticizing Bush for the tariff repeal, saying: "This is a sad day for American steel."
Strickland, D-6th, of Lisbon, said steelmakers are still working to restructure and needed the three-year tariffs the president had originally promised.
"Today we needed a strong president willing to stand up for American steel," he said. "Instead we witnessed an act of weakness and capitulation."
Congressman Tim Ryan, D-17th, of Niles, said he is extremely disappointed that Bush "broke his promise to the hardworking men and women of America's steel industry."
Ryan challenged the president's assertion that he is lifting the tariffs because the steel industry is healthy again.
"That claim defies all logic," Ryan said. "If the president thinks the steel industry is healthy, then he should pay more attention to all of the closed steel factories the next time he makes a fund-raising trip to Ohio."
vinarsky@vindy.com