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Japan oil well pipes to be exempted from Section 232

United States Department of Commerce has decided to exempt Japan’s oil well pipes exported to the US from the Section 232 of the Trade Expansion Act, responding to the requests from large US corporate customers, including Shell, Chevron, BP, and HESS. Japanese mills were particularly concerned whether their rail, oil well pipes, electrical steel sheet, and long products would be exempted. Some rail and grain-oriented electrical steel sheet have already been exempted, in addition to oil well pipes approved this time. Regarding long products, some of them have been exempted in a small quantity; and observers consider that they will be exempted over time, in particular those for processed goods. With these outcomes, the exemption-from-the-Section-232 issue seems to have passed its peak this year.

Of Japan-made oil well pipes, those with a diameter of 16 inches or larger are subject to anti-dumping duties, and those with a smaller diameter are subject to the exemption this time. Also, not all of the pipes in the latter category are exempted only those for large-sized customers. However, there have been cases where the DOC gave exemption after repeated requests; and therefore, US customers will likely to continue submitting applications for exemption. 

Japan’s exports of steel pipe products (including seamless pipes and electric resistance-welded pipes) to the US in the Jan-Aug period this year stood at 75,000 tons, up 36.6% year-on-year (y/y). With recovery in production at the oil and gas sectors, the effect of the Section 232 was, quantity-wise, negligible. At present, Japanese mills are continuing production of oil well pipes at full capacity.
Yaang Pipe Industry Co., Limited (www.yaang.com)

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