April 9 (Bloomberg) -- Seven steel manufacturers, including U.S. Steel Corp., filed a petition with U.S. trade agencies accusing China of illegally dumping pipes used to extract oil and gas.

The steelmakers, in a petition to the U.S. Department of Commerce and the U.S. International Trade Commission, argue that Chinese mills benefit from subsidies for so-called oil-country tubular goods which are sold in the U.S., according to a statement yesterday by the United Steelworkers, a union representing staff at the companies. China Iron and Steel Association’s Vice Chairman Qi Xiangdong declined to comment.

U.S. Steel, the largest U.S. steelmaker by 2008 sales, has idled steelmaking capacity and cut spending to contend with a drop in demand. The recession has put more steel-manufacturing jobs at risk and more jobs still may be lost because of U.S. imports of Chinese-manufactured steel products, the union said.

“Nearly one-third of the pipe manufacturing organizations we represent are experiencing layoffs,” Gary Hubbard, a spokesman for the union, said in a phone interview. “China continues to divert its products to our market, and if we sit back and do nothing we’ll lose our production capacity.”

The petition, he said, seeks “to assure we’ll have the jobs when the market comes back from the current recession.”

Steel pipe imports from China increased from 900,000 tons in 2007 to last year’s level of 2.2 million tons, worth an estimated $2.7 billion, according to the United Steelworkers. The union also joined the petition.

The petition filed at the U.S. International Trade Commission is U.S. Steel Corp. v. People’s Republic of China, No. 2659.

By Joel Rosenblatt

To contact the reporter on this story: Joel Rosenblatt in San Francisco at jrosenblatt@bloomberg.net.Last Updated: April 9, 2009 01:49 EDT

Source: www.bloomberg.com