Commerce Deparment Concludes Study on Effect of Imports of Iron Ore and Semi-finished Steel on U.S. National Security

Washington, DC - In a report released today, the Commerce Department concluded that the United States produces sufficient quantities of iron ore and semi-finished steel domestically to satisfy U.S. national security requirements.

The report summarizes the findings of a nine-month investigation into the effect of imports of iron ore and semi-finished steel on U.S. national security. The investigation was requested on January 16, 2001, by Representative James Oberstar (MN) and Representative Bart Stupak (MI) under Section 232 of the Trade Expansion Act of 1962.

The 56-page report, submitted to the President, finds that iron ore and semi-finished steel – both used in manufacturing finished steel – are important to U.S. national security, but that imports of these two items do not threaten to impair U.S. national security.

These conclusions, reached in consultation with the Department of Defense, take into account the events of September 11 and the related military operations resulting therefrom.

The investigation revealed that the United States produces approximately three times the maximum amounts of iron ore and semi-finished steel that might be required for national security purposes. The report also finds, based on the analysis of the Department of Defense, that national defense needs for iron ore and semi-finished steel have declined in recent years and are likely to remain flat for at least the next five years.

Imports account for approximately 20 percent and 7 percent, respectively, of total U.S. consumption of iron ore and semi-finished steel. Most imports of these items derive from Canada, Mexico, and Brazil – countries deemed to be "safe" suppliers for national security purposes.

The Section 232 investigation is separate from the investigation recently conducted by the International Trade Commission under Section 201 of the Trade Act of 1974. The Section 232 investigation was focused on the narrow issue of the effect on national security of imports of two particular products. The Section 201 proceeding covers many types of steel imports and addresses the broader issue of whether these imports are a substantial cause of serious injury to competing U.S. producers.

For more information: www.bxa.doc.gov