The American Line Pipe Producers Association (ALPPA), a domestic coalition of large diameter line pipe producers, has challenged recent claims that US pipeline developers are unable to source large diameter welded pipe (LDWP) for their projects domestically and that steel Section 232 tariffs imposed by President Trump are placing US pipeline projects in jeopardy due to cost.
According to the ALPPA, there is no merit to claims by US pipeline developers and pipeline industry associations, such as INGAA and AOPL, that they cannot source their LDWP needs domestically. The US LDWP industry is now operating at a capacity utilisation rate of well under 40% – the lowest it's been in years – and, claims the ALPPA is "ready, able and eager to supply any pipeline operator if given the opportunity to do so". With this in mind, the ALPPA strongly opposes requests from pipeline operators to be excluded from Section 232 steel tariffs.
Tim Brightbill, trade counsel to the ALPPA, commented: “US producers can make virtually everything demanded for American pipeline projects, and they do so using domestic steel,“ he said. "Complaints by industry groups such as the Interstate National Gas Association of America (INGAA) and the Association of Oil Pipe Lines (AOPL) are completely unfounded. There is no reason why US pipeline projects should not be using US-manufactured large-diameter line pipe.”
The ALPPA said that allegations that US pipeline projects will be put on hold due to 232 tariffs are 'highly exaggerated'.
"While a tariff may increase the price of imported LDWP, it will not do so to the levels that pipeline operators are claiming as the cost for the pipes make up only around 20% of the total pipeline project cost," the ALPPA claims. "These operators have continued to rely on imports and US LDWP producers continue to lose bids, notwithstanding 232 tariffs. Pipeline projects continue to be highly profitable – much more so than the US welded pipe manufacturers supplying them, who have been injured due to dumped and subsidised imports of LDWP."
The ALPPA sides with the President and Commerce Department, who concluded that US producers of steel pipes are essential to US national security and critical infrastructure, and are threatened by imports of these products.
In January this year, the ALPPA and other domestic producers filed anti-dumping and countervailing duty cases against dumped and subsidised imports of LDWP from Canada, China, Greece, India, Korea, and Turkey and, according to the ALPPA, the International Trade Commission has already made a unanimous preliminary determination that the US LDWP industry has been materially injured or threatened due to these imports. Preliminary subsidy determinations are due later this month; preliminary anti-dumping determinations are due in August.
Washington DC-based law firm Wiley Rein LLP represent the ALPPA on trade-related matters.