March 9, 2018 / 12:29 AM / 9 months ago

China metal producers urge Beijing to retaliate on U.S. tariffs

SHANGHAI/BEIJING (Reuters) - China’s steel and metals associations called on Friday for Beijing to retaliate against U.S. tariffs on aluminium and steel imports, as a widely read tabloid said the country will not be bullied by threats of a trade war with the world’s top economy.

FILE PHOTO: Workers check steel bars at a factory of Dongbei Special Steel Group Co., Ltd. in Dalian, Liaoning province, China November 27, 2017. REUTERS/Stringer/File Photo

In the most explicit threat yet in an escalating trade spat, two leading industry bodies said producers strongly oppose the duties, and urged the government to take “resolute measures” against U.S. imports ranging from stainless steel to coal and electronics.

U.S. President Donald Trump pressed ahead with the imposition of 25 percent tariffs on steel imports and 10 percent for aluminium on Thursday, to counter cheap imports, especially from China.

“Trump’s behaviour is a challenge to the global steel industry and will definitely encounter opposition from more countries,” the China Iron & Steel Association (CISA) said in a statement on its website.

“CISA appeals for the Chinese government to take resolute measures against imports of some U.S. products including stainless steel, galvanized sheet, seamless pipe, coal, agriculture products and electronic products,” the industry body said. Its comments were echoed in a separate statement by the China Nonferrous Metals Industry Association.

China’s Ministry of Commerce said the country would assess any damage caused by the U.S. move and “firmly defend its legitimate rights and interests.” It urged the United States to withdraw the measures as quickly as possible.

The dispute has fuelled concerns that soybeans, the United States’ most valuable export to the world’s No. 2 economy, might be caught up in the trade actions after Beijing launched a probe into imports of U.S. sorghum, a grain used in animal feed and liquor.

However, it is the first time that coal has been drawn into the spat. China has ramped up imports of U.S. coal over the past year, as its utilities have sought cheaper foreign fuel. That has helped to revive the fortunes of the U.S. industry.

In 2017, imports totalled 3.2 million tonnes, compared with 694 tonnes in 2016.

Trade tensions between the world’s two largest economies have risen since Trump took office. China accounts for only a small fraction of U.S. steel imports, but its massive industrial expansion has helped create a global glut of steel that has driven down prices.

In an editorial on Friday, the Global Times said China will not be bullied by Trump’s threat of a trade war.

“If the U.S. cannot adjust its own industrial structure to reduce its trade deficit and orders the world to follow its words, China and the rest of the world will have no choice but to meet the challenge head-on.”

The ramping up of rhetoric is a move away from the more conciliatory tone struck in recent weeks when Chinese President Xi Jinping’s top economic adviser, Liu He, visited Washington for trade talks.

Reporting by Adam Jourdan and Ruby Lian in SHANGHAI and Josephine Mason in BEIJING; editing by Richard Pullin

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