International Trade Law News

The U.S. Department of Commerce's Bureau of Industry and Security (BIS) has rejected the short supply petition on exports of copper and copper-alloy scrap that was filed on April 7, 2004 by the Copper & Brass Fabricators Council, Inc. and the Non-Ferrous Founders Society. The petition requested the U.S. government to impose monitoring and controls on exports of recyclable metallic materials containing copper pursuant to the short supply provisions of Section 7(c) of the Export Administration Act and Section 754.7 of the Export Administration Regulations. The short-supply petition alleged that China's demand copper-based scrap had led to shortages and high prices in the U.S. market. The petition indicated that major consumers of copper-based scrap, including the brass mill industry and brass and bronze foundries, have been particularly hard hit by the scarcity and high prices in the U.S. market.

After analyzing the petition, BIS determined that neither monitoring nor controls on exports of copper and copper-alloy scrap are necessary since the evidence failed to demonstrate an existence of a shortage and that the domestic price increases for copper products did not have a significant adverse effect on the national economy.

Although BIS failed to find sufficient evidence to warrant imposing monitoring or export controls, BIS indicated that it will work to refine the Schedule B classifications for copper and copper-alloy scrap in order to better delineate the varieties of scrap that are being exported. BIS also noted that it will work with the Office of the United States Trade Representative and the Department of State to address any foreign government practices that are distorting trade in copper and copper-alloy scrap.

In a related development, the Emergency Steel Scrap Coalition, a group that includes several large steel producers and several thousand steel consuming companies, recently announced plans to submit a short-supply petition to BIS on U.S. steel scrap exports. While overall scrap prices have fallen over the past few months, the price of certain types of steel scrap has recently skyrocketed. The Emergency Steel Scrap Coalition also is lobbying U.S. trade officials to convince a number of countries, including South Korea, Egypt, Taiwan, Mongolia and Venezuela, to remove taxes and other restrictions that have been imposed on the export of steel scrap.