Source: The Sydney Morning Herald
Australian steelmaker BlueScope is unsure whether it will be spared under US President Donald Trump's crackdown on steel imports after a delegation led by Prime Minister Malcolm Turnbull left Washington unable to secure assurances from the White House.
The steel company's new chief executive, Mark Vassella, told investors on Monday that Bluescope officials and the federal government had been lobbying for special treatment for the company, including exemptions from tough new proposed steel import tariffs or quotas, but no commitment had yet been secured.
The case they were making to Trump administration, Mr Vassella said, was that the Melbourne-based BlueScope was not "just a straight exporter", as its steel from Australia was converted into higher-value product at its US west-coast operations.
He said Bluescope employed about 3000 American workers and had nearly $3 billion in local assets.
"We have been working hard through [the Department of Foreign Affairs and Trade], through the prime minister, through Minister [Steven] Ciobo, through Joe Hockey in Washington, the ambassador, to plead our case," he said.
"Lots of work has gone into that, but we're not sure what the outcome is going to be."
The Trump administration is weighing whether to impose punitive tariffs of 24 per cent on steel imports and 7.7 per cent on aluminium, after the proposal was given the all-clear from the US Commerce Department this month. The department found the influx of foreign metals had the potential to impair national security.
One of Mr Trump's strongest campaign pledges was to revive American heavy manufacturing and he has invoked national security imperatives as a reason to protect the country's domestic steel making capacity.
''They're dumping steel and destroying our steel industry, they've been doing it for decades and I'm stopping it," he said last year adding there were "two ways" to so "quotas and tariffs, maybe I'll do both".
Since last year's G20 summit in Hamburg it had been widely reported that American officials had signalled to their Australian counterparts that proposed tariffs were mainly targetting China and would not affect BlueScope.
In the latest discussions on the matter, Mr Ciobo, the federal trade minister, renewed calls for a Bluescope exemption while meeting counterparts in Washington DC over the weekend.
"Nothing's firm until it's decided," Mr Vassella said on Monday. "We've been supported strongly by Minister Ciobo ... and I would say we've put our best foot forward."
While unveiling BlueScope's half-year results, including a 23 per cent jump in net profit, Mr Vassella said the Trump administration's proposed steel import crackdown would affect its Australian steel exports and US west-coast operations, but could benefit the BlueScope-owned North Star steel mill in the US state of Ohio.
"That would have some impact on our west-coast business and exports out of Australia, but also potentially would be quite positive for North Star," he said.
BlueScope's North Star mill, which produces two million tons of steel a year and employs nearly 400 people, was "extremely profitable business", he said.
BlueScope's underlying earnings dipped 11 per cent to $516 million over the six months to December, but the company said it expected second-half earnings to be "around 25 per cent higher".
The company said it was heading to its second successive year of earnings exceeding $1.1 billion.
Shares in BlueScope rose more than 2 per cent, or 35¢ following the results, to finish the day at $15.84.