The US has raised its import duties on Chinese steelmakers by more than five-fold after accusing them of selling their products below market prices.
The taxes specifically apply to Chinese-made cold-rolled flat steel, which is used in car manufacturing, shipping containers, and construction.
The US Commerce Department ruling comes amid heightened trade tensions between the two sides over several products, including chicken parts.
Steel is an especially sensitive issue.
US and European steel producers claim China is distorting the global market and undercutting them by dumping its excess supply abroad.
The politics behind the move – Karishma Vaswani, Asia Business
correspondent, BBC News
The ruling itself is only directed at what is small amount of steel from China and Japan and won’t have much of an impact – but it is the politics of the ruling that’s worth noting.
It is an election year, and US presidential candidates have been ramping up the rhetoric on what they say are unfair trade practices by China.
US steel makers say that the Chinese government unfairly subsidises its steel exports. Meanwhile, China has been under pressure to save its steel sector, which is suffering from over-capacity issues because of slowing demand at home.
China’s Ministry of Finance has not directly responded to the US ruling but on its website this morning it has said that China will maintain its tax rebate policy for steel exports as part of its efforts to help the bloated steel sector recover.
These tax rebates are seen as favourable policies to shore up ailing steel companies in China, and to avoid massive job losses. Expect more fiery rhetoric from the US on China’s unfair trading practices soon.
A separate filing by major US steelmakers to the International Trade Commission is looking to completely ban all Chinese steel imports.
The US steel industry claims that around 12,000 workers have been laid off in the past year because of unfair Chinese competition.
China claims the weak economy is more responsible for the industry’s problems and that it has taken steps to reduce its steel production.
Last year, China’s exports of cold-rolled steel flat products to the US were valued at an estimated $272.3m (£188.5m).