Comparisons of Export Pricing Explanation of the Data Sources. Table 4.19 contains the relative prices of steel exports in terms of domest...
Comparisons of Export Pricing Explanation of the Data Sources. Table 4.19 contains the relative prices of steel exports in terms of domestic steel prices. The nrelative export pricen of'ã steel commodity is r;-,. ,-:: defined as its export price divided by its domestic price. The data used for domestic prices are those in table 4.18. The sources we employed for export prices were as follows: For the United States unit values were used; they were obtained from the U.S. Department of Commerce, Bureau of the Census, publication FT 410 U.S. Exports: Commodity by Country. 73/ The bar product selected was concrete reinforcing bars, while uncoated plates was the plate choice. In all cases for all countries domestic and export, carbon steel products were selected. For the EC, the unit values used were for steel exports published in the Statistical Office of the European Community's (SOEC) biannual Yearbook of Iron and Steel. This was the same source employed for domestic prices in the EC.
For Japanese export pr ices we used the data available in the publication The Summary Report: Trade of Japan. This is a Ministry of Finance document published by the Japa~ Tariff Association. Thus, virtually all the data are in unit values. l!/ The selection of unit values was made for two fundamental reasons: First, in general, unit values are the best approximation ava ilable for steel pr ices. On the theOret ical level, products .~ ~ such as concrete reinforcing bars or cold rolled carbon sheets are standardized products compared with most finished products. They should, therefore, be subject to fewer product mix difficulties than other unit value indexes of finished products. On the empir ical level, the index of steel expor t pr ices of continental European producers published in Metal Bulletin (and reprinted in a number of statistical publications) is widely regarded as an excellent source of pr ice data. The data are obtained confidentially by Metal Bulletin currespondents on the basis of actual prices and transactions. ~/ However, the Wage and Price Stability Council's A Study of Steel Prices (5, pp. 44, 451 has shown that unit values taken from 74/ The exception is recent Japanese domestic prices, for Which unit value data are unavailable. 75/ For example, see the assessment of these data in the ãñnual statistical publication of the Organization for Economic Cooperation and Develppment entitled The Iron and Steel Industry, and in Krav1s and Lipsey (16, p. 2141. -224- U. S. Customs data follow the Metal Bulletin price series with a lag of several months. Thus the Council's comparison leads to the conclusion that unit values of steel exports reflect actual steel export pr ices fairly well, provided that one adjusts for the several months' lag in unit value indexes. A second reason for selecting unit values throughout was to ma intain compar abil i ty. Generally speak ing, no better source was available. However, the Met~l &ulletin index of European export pr ices is a better source for actual pr ices than the SOEC index of un it expor t pr ices. No source comparable to Metal Bulletin is available, however, for domestic European prices. Therefore, had the Metal Bulletin data been chosen, the relative export pr ices of the EC would have contained biased fluctuations because the export index is more responsive to actual pr ices than the SOEC domest ic index.
Consequently, SOEC un i t value indexes were used for both EC export prices and domestic prices. In the case of Japan, this difficulty could not be avoided for recent years. The unit value data are unavailable, so Metal Bulletin's assessment of Japanese domestic prices for the 1970's were used. Tests and Analysis of Export Pricing Data: Dumping. Recently, a number of authors have alleged that foreign producers "dump" steel. It is argued that dur ing recessions, Japanese and European producers export steel at low prices compared with the ir home markets, bu t dur ing booms steel is exported at high I prices compared with their home markets. For the 1955-67 period, i -225- Lennart Friden (7) computed relative export prices for selected steel products in a manner analogous to that used in table 4.19. He found that the United States was the only cOuntry whose steel industry did not price its exports below its domestic prices at any time. Friden concluded that other countries have a dual pricing structure with exports priced ø ~ both above and below domestic prices, depending on the time period. Thus, the Friden data appear tò"support the contention of the American Iron and Steel Institute: The Japanese labor system, 1 ike that in Europe, has the effect of making a large part of labor costs fixed costs. In the past, this has resulted in continu ing pressure on the Japanese steel industry to maintain operations by exporting at low prices during periods of weakening domestic steel consumption (2, p. 19). The view that import prices fluctuate in a cyclical pattern is also stated in Paul Marshall's summary of the steel pricing symposium held by the Council on Wage and Price
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