Tag Archives: U.S. commerce department

U.S. puts Chinese firms helping military on trade blacklist

WASHINGTON (Reuters) -The U.S. Commerce Department put a dozen Chinese companies on its trade blacklist on Wednesday citing national security concerns and in some cases their help with the Chinese military’s quantum computing efforts.

The department also said 16 entities and individuals from China and Pakistan were added to the blacklist for contributing to Pakistan’s nuclear activities or ballistic missile program.

In total, 27 new entities were added to the list from China, Japan, Pakistan, and Singapore.

Commerce Secretary Gina Raimondo said in a statement that the move will help prevent U.S. technology from supporting the development of Chinese and Russian “military advancement and activities of non-proliferation concern like Pakistan’s unsafeguarded nuclear activities or ballistic missile program.”

The Commerce Department said Hangzhou Zhongke Microelectronics Co. Ltd., Hunan Goke Microelectronics, New H3C Semiconductor Technologies Co. Ltd., Xi’an Aerospace Huaxun Technology, and Yunchip Microelectronics were placed on the Commerce Department’s entity list for their “support of the military modernization of the People’s Liberation Army.”

It also added Hefei National Laboratory for Physical Sciences at Microscale, QuantumCTek, and Shanghai QuantumCTeck Co. Ltd. to the list for “acquiring and attempting to acquire U.S.-origin items in support of military applications.”

Suppliers to these companies will need to apply for a license before selling to them, which is likely to be denied.

(Reporting by Chris Sanders and Karen Freifeld; Editing by Chizu Nomiyama and David Clarke)

Biden looks abroad for electric vehicle metals, in blow to U.S. miners

By Ernest Scheyder and Trevor Hunnicutt

(Reuters) – U.S. President Joe Biden will rely on ally countries to supply the bulk of the metals needed to build electric vehicles and focus on processing them domestically into battery parts, part of a strategy designed to placate environmentalists, two administration officials with direct knowledge told Reuters.

The plans will be a blow to U.S. miners who had hoped Biden would rely primarily on domestically sourced metals, as his campaign had signaled last autumn, to help fulfill his ambitions for a less carbon-intensive economy.

Rather than focus on permitting more U.S. mines, Biden’s team is more focused on creating jobs that process minerals domestically into electric vehicle (EV) battery parts, according to the people.

Such a plan would help cut U.S. reliance on industry leader China for EV materials while also enticing unions with manufacturing work and, in theory, reduce pandemic-fueled unemployment.

The U.S. Commerce Department is organizing a June conference to attract more EV manufacturing to the country. Biden’s proposed $1.7 trillion infrastructure plan earmarks $174 billion to boost the domestic EV market with tax credits and grants for battery manufacturers, among other incentives. The department declined to comment.

“It’s not that hard to dig a hole. What’s hard is getting that stuff out and getting it to processing facilities. That’s what the U.S. government is focused on,” said one of the sources.

The approach would see the United States rely on Canada, Australia, and Brazil – among others – to produce most of the critical raw materials needed, while it competes for higher-value jobs turning those minerals into computer chips and batteries, according to the two sources.

Securing the full supply chain from metals to batteries does not require the United States to be the primary producer of the raw materials, said one of the sources.

A full strategy will be finalized after a year-long supply chain review involving national security and economic development officials.

Biden officials want to ensure the administration’s EV aspirations are not imperiled as domestic mines face roadblocks, the sources said, both from environmentalists and even some Democrats.

“It rings hollow when I hear everyone use this as a national defense argument, that we have to build new mines to have a greener economy,” said U.S. Representative Betty McCollum, a Democrat who has introduced legislation that would permanently block Antofagasta Plc’s proposed Twin Metals copper mine in Minnesota.

Ali Zaidi, deputy White House national climate advisor, said the administration was focused on a strategy that “leverages our domestic resources in a way that’s responsible”, noting that included recycling in the supply chain.

While U.S. projects from small and large miners alike will feel the impact, the pain from any blocked projects will fall disproportionately on smaller, U.S.-focused companies. Many large miners also have global projects that could benefit from the administration’s plan.

“We can no longer push the production of the products we want to places we cannot see and to people we will never meet,” said Mckinsey Lyon of Perpetua Resources Corp, which is trying to develop Idaho’s Stibnite mine to produce gold and antimony used to make EV battery alloys.

INVESTMENTS

The U.S. government in April became the largest shareholder in mining investment firm TechMet, which controls a Brazilian nickel project, a Rwandan tungsten mine and is a major investor in a Canadian battery recycler.

Washington also funds research into Canadian cobalt projects and rare earths projects in Malawi, among other international investments.

The State Department’s Energy Resource Governance Initiative (ERGI) is one of the main programs Washington plans to use to help allies discover and develop lithium, cobalt and other EV metals. To be sure, Washington is not ignoring domestic mining.

The U.S. Department of Energy has awarded grants to help old coal mines find ways to produce rare earths. U.S. officials have also funded MP Materials Corp, which owns the country’s only rare earths mine, though it relies on Chinese processors.

But the bulk of Biden’s approach is designed to sidestep battles with environmentalists and save capital for other fights, according to one administration source. During a visit to a Ford Motor Co plant in Michigan on May 18, Biden called for government grants for new EV battery facilities. He mentioned Australia’s lithium reserves during the tour, but not large U.S. supplies of the key battery mineral.

Republicans say Biden’s EV plans will be impossible to achieve without more U.S. mines.

“These ‘not-in-my-backyard’ extremists have made clear they want to lock up our land and prevent the mining of minerals,” U.S. Representative Lauren Boebert, a Colorado Republican, told a House Natural Resources Committee forum held the same day as Biden’s Michigan visit.

PLACATING LABOR

Biden’s approach comes with risks, including angering political supporters within the labor movement who want the administration to have an openness to resource extraction and the attendant jobs.

“Let’s let Americans extract these minerals from the earth,” said Aaron Butler of United Association Local 469 union, which does work for Rio Tinto Ltd’s proposed Resolution copper mine project in Arizona and endorsed Biden in the elections. “These are good-paying jobs.” Many of the skills that labor unions would use to build mines, including concrete and electrical work, can also be used to build EV metal processing plants.

The National Mining Association, an industry trade group, has been lobbying the White House and Congress to support domestic projects, arguing that the coronavirus pandemic showed the importance of localizing supply chains.

Biden’s White House is now quietly working to enlist labor support as it tries to build a case that its green policies are creating jobs, ahead of the 2022 midterm elections that could determine whether the strategy wins congressional backing, according to two organized labor sources familiar with the campaign Biden officials have reached out to unions across the country asking for specific job-boosting projects the administration can take credit for, the labor sources said.

(Reporting by Ernest Scheyder in Houston and Trevor Hunnicutt in Washington; Editing by Amran Abocar and Marguerita Choy)

Share of U.S. workers holding multiple jobs is rising, new Census report shows

By Jonnelle Marte and Lucia Mutikani

(Reuters) – The share of Americans working more than one job to make ends meet has been growing over the past two decades, and the pay from second jobs make up a substantial share of workers’ earnings, according to a paper published by the U.S. Commerce Department on Wednesday.

An estimated 7.8% of U.S. workers had more than one job as of the first quarter of 2018, up from 6.8% in 1996, according to new data unveiled by the Census bureau, which provides a more detailed analysis of multiple job holders than was previously available. The findings were based on data from 18 states.

The earnings from the workers’ second jobs make up an average 28% of their total earnings, showing that workers are likely relying on that pay, researchers said.

In general, women were more likely to have multiple jobs than men, with 9.1% of women holding multiple jobs as of 2018, compared with 6.6% of men.

They also noted that multiple-job holding occurred at all levels of income, but was more common for low-wage workers. Those juggling more than one occupation earned less, on average, than people who had only one job.

People working in health care and food services were more prone to having more than one job than people working in other industries

The Census Bureau researchers looked at the number of people who held more than one job during in a quarter, holding at least one job for the entire three months.

(Reporting by Jonnelle Marte and Lucia Mutikanid; editing by Jonathan Oatis)

China supporting steel exports, U.S. imposes hefty tariffs

Columns of steel are stacked inside the China Steel production factory in Kaohsiung, southern Taiwan

By Ruby Lian and David Lawder

SHANGHAI/WASHINGTON (Reuters) – China said it would persist with controversial tax rebates to steel exporters to support the sector’s painful restructuring, defying a United States move to impose punitive import duties on Chinese steel products.

A worldwide steel glut has become a major trade irritant, with China under fire from global rivals who say it is dumping cheap exports after a slowdown in demand at home.

In a marked escalation of the spat, the United States on Tuesday said it would impose duties of more than 500 percent on Chinese cold-rolled flat steel, widely used for car body panels, appliances and in construction.

However, China’s Ministry of Finance said it would “continue to implement a tax rebate policy on steel exports” as it tries to finance a costly capacity closure plan.

By far the world’s largest steel producer, China plans to eliminate 100-150 million tonnes of annual production – more than the U.S. produces per year – over the next five years. The cabinet said central government-controlled firms will cut steel and coal production capacity by a tenth in 2016-17.

The finance ministry said China was making special funds available to curb overcapacity in both steel and coal and would reward local authorities for exceeding their targets and meeting them early.

The policy document, though dated May 10, was published just hours after the U.S. tariffs were announced. It is the latest policy announced by different departments including the Ministry of Human Resources and Social Security to push forward capacity cuts.

ON G7 MENU

The U.S. Commerce Department said the new duties effectively increase more than five-fold the import prices on Chinese-made cold-rolled flat steel products, which totaled $272.3 million in 2015. It found that products were being sold in the U.S. below cost and with unfair subsidies.

China’s Commerce Ministry expressed its “strong dissatisfaction” with the U.S. ruling, and said the United States should rectify its mistakes as soon as possible.

“The United States adopted many unfair methods during the anti-dumping and anti-subsidy investigation into Chinese products, including the refusal to grant Chinese state-owned firms a differentiated tax rate,” it said.

The Group of Seven rich nations plans to address the steel glut when it meets in Japan later this month, in a move seen likely to add to pressure on China.

Analysts said the potential closing off of the U.S. market would not substantially reduce China’s exports, accounting for just 2 percent of its total shipments.

“The duty will not have a big impact on China’s overall steel exports because the volume to the United States is very small… but because of anti-dumping, export destinations are becoming more and more dispersed,” said Kevin Bai, an analyst with CRU in Beijing.

CHINA DENIES FLOODING MARKETS

While a flood of cheap Chinese steel has been blamed for putting some overseas producers out of business, China denies its mills have been dumping their products on foreign markets, stressing that local steelmakers are more efficient and enjoy far lower costs than their international counterparts.

China has also denied there are any inducements in place that encourage steelmakers to sell their products overseas, saying trade flows are determined by the market.

“Global demand is increasing, and Chinese steel products are very competitive, so exports are increasing a little, but the steel sector is mainly used to satisfy domestic demand and there has never been any policy support for large volumes of exports,” China Iron and Steel Association (CISA) chairman Ma Guoqiang said at a conference this week.

However, a vaguely-worded statement from the central bank and several other government bodies last month said China would encourage exports and provide financing for steel and coal firms looking to move overseas.

While the government has offered as much as 100 billion yuan ($15 billion) to help handle worker layoffs, China’s debt-ridden steel sector cannot afford to abandon the financial lifeline provided by exports.

Foreign sales reached a record 112.4 million tonnes last year, up 19 percent, though total value fell 10.5 percent to $62.8 billion as a result of plunging prices.

More than half of large steel mills still made losses last year, according to the CISA.

Steelmakers have called on more proactive support for the export business, with Chen Ying, the general manager of Jiangsu Shagang, telling a conference on Monday that boosting foreign sales would help speed up the country’s restructuring efforts.

“China should support exports – steel product exports and moving projects and plants abroad,” she said.

(Reporting by Ruby Lian and David Lawder, with additional reporting by David Stanway and Michael Martina; Editing by Lincoln Feast and Ian Geoghegan)