Best Bar attacks steel inquiry amid Arrium crisis [IMG] <img...

Best Bar attacks steel inquiry amid Arrium crisis
http://www.copyright link/content/dam/images/g/n/0/b/n/a/image.related.afrArticleLead.620x350.gn5j7n.png/1456631191846.jpg <img src="/content/dam/images/g/n/0/b/n/a/image.related.afrArticleLead.620x350.gn5j7n.png/1456631191846.jpg" alt="The Arrium/ OneSteel plant in Whyalla, South Australia, is under huge pressure." width="620" height="350" class="lazy620x350"/>
The Arrium/ OneSteel plant in Whyalla, South Australia, is under huge pressure. David Mariuz
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by Tim Binsted
Arrium is using its debt crisis to lobby for protections against imported steel which, if successful, could kill competition on the cusp of an infrastructure boom, Best Bar chief executive Grant Johnston said.
Last week Arrium said it had agreed to a rescue package from US vulture fund GSO to restructure its $2 billion debt as the listed steel, iron ore and mining consumables group battles for survival.
"They [Arrium] are painting a brush over this crisis and saying it is because of imported steel coming into Australia. The truth is they've got themselves into trouble and they are [using] it as a whip against the government for protectionism," Mr Johnston told Fairfax Media.
Just days before the GSO announcement, Federal Industry, Innovation and Science Minister Christopher Pyne said he had directed the Anti-Dumping Commissioner Dale Seymour to 'urgently' inquire into dumping of Asian steel.

Arrium's iconic Whyalla steelworks is a large regional employer in Mr Pyne's home state of South Australia. Both the Whyalla blast furnace and Arrium's South Australian iron ore business are under extreme stress in the current low commodity price environment.
"OneSteel [Arrium's steel arm] has tried for dumping tariffs on literally all reinforcing steel and wire rods into Australia. They've really gone mad with this," Mr Johnston said.
Best Bar is a cut and bend fabricator that imports its raw feed from a NatSteel mill in Singapore. The imported product is subsequently manufactured into finished reinforcing steel in Australia to supply construction projects such as roads, bridges, high rise buildings, and most recently, the massive Wheatstone and Gorgon LNG projects.
The company, which is already subject to a 3 per cent import duty, employs more than 300 people in Perth, Darwin, Adelaide, Melbourne and Sydney. It has an annual turnover of around $220 million.




Company Profile
International diversified mining and materials company comprising of three key businesses: Arrium Mining, Arrium Mining Consumables and OneSteel Steel & Recycling.
www.arrium.com

Dumping occurs when foreign producers land imported products at below the usual cost in their domestic market. Anti-dumping inquiries can lead to special tariffs that raise the price of imports.
Mr Johnston has attacked Arrium's aggressive push for dumping duties before, but he worries the company's current crisis could lead to rash anti-competitive decisions.
The South Australian government has already said it will make sure any steel used on its projects is "Australian standard steel".
Independent senators Nick Xenophon and John Madigan have proposed a 'buy our steel' policy that would consider factors like employment and local economic benefit when procuring materials, such as steel, for government use.

Last year the NSW government deferred $60 million in payroll taxes for BlueScope Steel when the company threatened to close its blast furnace at Port Kembla.
Mr Johnston said a huge wave of infrastructure projects is expected to commence in the next few years and he warns there will be no competitor for Arrium.
"We are the second-largest reinforcing company in Australia and we only have about 10 per cent market share . . . Arrium control about 80 per cent," he said.
"We go in to tender on some of these large projects, particularly in Sydney and Melbourne, and we're now being told unless we use Australian-made steel we can't qualify as a tender but construction companies still want our pricing to keep Arrium honest."

Through its OneSteel business Arrium is Australia's only manufacturer of steel long products with 2.5 million tonnes of capacity.

Global steel prices have been severely depressed by excessive production capacity around the world. China, which produces half the world's steel, has seen its exports rockets through 100 million tonnes a year as its economy and domestic steel demand have slowed.
The World Steel Association said last week that its 66 member countries produced 128 million tonnes of steel in January, down 7.1 per cent on last year, and utilised just 66 per cent of their steelmaking capacity.