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Section 301 Investigation: China’s Acts, Policies, and Practices Related to Technology 

Transfer, Intellectual Property, and Innovation - Form to Request Exclusion of Product

When submitting a product exclusion request using this form, enter the specified 

information in the following fields and explain the basis and rationale for your statements. 

By completing this form, you certify that the information provided is complete and 

correct to the best of your knowledge.

1. Indicate whether the comment contains business confidential information (BCI), is a public 

document, or is a public version of a BCI document.

Public Version of BCI

2. Please provide a complete and detailed description of the product of concern:

The product of concern is a vertical looper. The vertical looper is made of welded steel and is used in the 

manufacture of coiled steel rebar. The machine consists of a looper frame mounted on a foundation frame, an 

idle persuader roller for loop formation (pneumatically operated), entry and exit hold-down idle rollers, and 

persuader and hold-down rollers. The function of the machine is to reduce the tension of the steel rebar during 

the spooling or wrapping cycle. This vertical looper is numerically controlled.

3. 10-digit HTSUS item number* for product you wish to address in this product exclusion 

request: *Use numerical characters only with no special characters (example: 1023456789). For help 

in finding the HTSUS item number associated with your product, see https://hts.usitc.gov/

8428900290

4. Requestor Information

Requestor Name (Last, First): Rossetto, Luca

Organization Name: Danieli Corporation

Note: Representatives submitting on behalf of an organization must enter information below.

Requestor Representative: James M. Smith, Covington & Burling LLP

5. Requestor’s relationship to the product: Importer

6. Does this submission in regulations.gov include additional attachments?

YES

7. Please indicate whether any additional attachment contains business confidential information 

(BCI), is a public document, or is a public version of a BCI document.

Public Document

8. Is this product, or a comparable product, available from sources in the United States? 

NO
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9. Is this product, or a comparable product, available from sources in third countries?

NO

10. Please provide the value and quantity (with units) of the Chinese-origin product of concern 

that you purchased for each calendar year specified. Limit this figure to the products 

purchased by your firm (or by members of your trade association) alone. Please provide 

estimates if precise figures are unavailable.

2017 Value: [ I ] 2017 Quantity: [ I ] units

2016 Value: [ I ] 2016 Quantity: [ I ] units

2015 Value: [ I ] 2015 Quantity: [ I ] units

11. Please provide information in support your request, taking account of the instructions 

provided in Section B of the Federal Register notice (note: text entered below can extend 

beyond the apparent size of this box).

As we explain in detail in the attached narrative, the Danieli Corporation (“Danieli”) based in 

Pennsylvania is a leading U.S. supplier of steel manufacturing equipment and plants for the domestic 

steel industry. Danieli has contracted with the Commercial Metals Company (“CMC”) to supply 

infrastructure and custom-built machinery for a planned expansion of CMC’s micro mill in Mesa, 

Arizona. However, the Section 301 tariffs recently imposed on imports from China directly threaten 

the timely completion of this project. 

In 2017, long before Section 301 tariffs were imposed, Danieli based production of the custom-built 

machinery to be delivered under the contract in China, after considering the specifications, schedule, 

and budget of CMC. There are no known U.S. suppliers of this equipment, and shifting to a third 

country would not be possible without substantial delay. Under these circumstances, imposing Section 

301 tariffs on vertical loopers and other machinery covered by the Mesa project would cause severe 

economic harm to Danieli and CMC. 

More broadly, the tariffs would also adversely impact the Administration’s efforts to expand and 

modernize domestic steel manufacturing capabilities. This harm to a key national security policy 

objective would come with no countervailing benefit, as custom-built steel manufacturing equipment 

for export is not the target of Chinese industrial policies such as Made in China 2025.

A narrow, temporary exclusion for the specific equipment to be installed at the Mesa mill would 

advance the U.S. interest in revitalizing and growing the domestic steel industry. 

For additional information, please see the attached narrative and exhibits. 
Danieli Corporation

600 Cranberry Woods Drive,

Suite - Cranberry Township,

PA 16066

P.O.Box 640039 Pittsburgh

PA 15264-0039

Phone (724) 778-5400

Fax (724) 778-5401

October 9, 2018 PUBLIC ATTACHMENT

VIA ELECTRONIC SUBMISSION

Ambassador Robert E. Lighthizer

U.S. Trade Representative

600 17th St. NW

Washington, DC 20508

Re: Docket No. USTR-2018-0025: Danieli Request for Exclusion of Machinery Supplied 

Under the CMC Contract From the Determination of Action Pursuant to Section 301

Dear Ambassador Lighthizer:

The Danieli Corporation (“Danieli”), which is based in Pennsylvania, respectfully 

requests the exclusion over the next year of certain highly customized, project-specific vertical 

loopers classified under HTSUS subheading 8428.90.0290 from the determination of action 

pursuant to Section 301 of the Trade Act of 1974.21

Danieli is a leading U.S. supplier of steel manufacturing equipment and plants to 

domestic steel producers. In 2017, long before the Section 301 tariffs were imposed, we 

contracted with Commercial Metals Company (“CMC”) to supply major steel infrastructure for a 

planned expansion of CMC’s micro mill in Mesa, Arizona.22 In connection with this contract, 

Danieli is set to supply equipment for a spooler that will produce hot-rolled, spooled rebar at the 

Mesa mill.23 This spooler, once installed, is expected to reduce CMC’s production costs and 

improve efficiency and yield.24 

 

21 Notice of Action and Request for Public Comment Concerning Proposed Determination of Action Pursuant to 

Section 301: China’s Acts, Policies, and Practices Related to Technology Transfer, Intellectual Property, and 

Innovation, 83 Fed. Reg. 28,710 (June 20, 2018), at Annex A.

22 Specifically, Danieli contracted to supply a crop shear machine, pinch roll machine, vertical looper, dividing 

shear, rotating bench, rotating fork, coil transport car, insulated chain conveyor, diverter, and runways. 

23 Commercial Metals Company, News Release, Commercial Metals Company Announces Second Investment in 

Spooled Rebar at its Arizona Micro Mill (Att. A); see also Mesa Now, Commercial Metals Company 

Groundbreaking for CMC Steel Arizona Spooler Expansion in Mesa (Apr. 25, 2018) (describing planned 63,000 

square foot expansion of the facility).

24 See Commercial Metals Company, Spooled Rebar: The Latest Innovation in Rebar from CMC (Att. A). CMC is 

the first and only producer of spooled rebar in the United States. See id.
PUBLIC ATTACHMENT

Rationale for Exclusion

October 9, 2018

Page 2

The Danieli Group, our parent, operates five production units for steelmaking equipment 

in Asia and Europe, and we select production units to fulfill contracts based on the needs and 

technical requirements of our purchasers. For the Mesa project, we made a determination in 

2017 to source the machinery from China. This decision predated the Section 301 action and 

reflected multiple factors, including capacity, delivery times, and cost. As a result, Danieli 

commenced production in China on the Mesa project in early 2018. Production has been 

ongoing since then, with delivery of the equipment currently slated to commence in Fall 2018.

The Section 301 tariffs imposed following the U.S. Trade Representative’s (“USTR”) 

investigation into Chinese intellectual property practices directly threaten the CMC project in 

Mesa. As we explain below, without exclusions from the Section 301 tariffs, the timely 

completion of the Mesa project will be in jeopardy. Danieli recognizes and appreciates the 

importance of fair and reciprocal trade. But we respectfully submit that tariff exclusions are 

needed for the Mesa project’s highly customized steel manufacturing equipment in order to 

avoid severe economic harm to U.S. interests, and also to promote the development of the 

domestic steel industry. 

I. Equipment Needed for CMC’s Mesa Project Is Not Manufactured in the United 

States and Cannot Cost-Effectively Be Sourced Now From Third Countries 

The vertical loopers for which Danieli seeks an exclusion are not commodity products. 

They are highly sophisticated, expensive machines that are custom built to order based on the 

purchaser’s specifications. The specifications, budget, and schedule for the CMC project did not 

allow Danieli to base production anywhere other than in China.

When Danieli was first awarded the CMC contract, we surveyed production options in 

multiple countries before concluding that production in Danieli’s China unit was the only 

feasible option. For example, Danieli considered whether production in the United States was 

possible. It was not. U.S. equipment producers do not have the facilities needed to manufacture 

the heavy machinery required by CMC at its micro mill. There is no potential U.S. source for 

the machines that CMC will install in Mesa.

Danieli has already commenced work on the CMC contract, meaning that it has devoted 

substantial resources to production in China. Moving production to a new facility at this stage 

would require that Danieli incur large losses and would significantly delay delivery of the CMC 

equipment. During the period of delay, efforts to revitalize U.S. steelmaking capacity would 

suffer. In the future, Danieli will not be seeking Section 301 exclusions for any new U.S. 

projects. But for the CMC project at this point, there may be no realistic alternative to sourcing 

machinery for the Mesa project from China.

II. Additional Duties Would Cause Severe Economic Harm to Danieli and CMC, and 

Would Undermine Broader U.S. Goals to Expand Domestic Steel Production

The continued imposition of Section 301 tariffs on machinery for the CMC project will 

cause severe economic harm to CMC and Danieli. Indeed, absent relief from the tariffs, the 

timely completion of the Mesa project is in peril. 
PUBLIC ATTACHMENT

Rationale for Exclusion

October 9, 2018

Page 3

If Danieli is not granted an exemption from the tariffs, we will be forced to delay delivery 

and production while we assess internally whether moving production outside of China is more 

economical than paying 25 percent tariffs on the multiple pieces of equipment to be delivered 

under the CMC contract. In either scenario, Danieli will incur major losses and CMC’s efforts to 

modernize its production machinery will be stalled.

Beyond causing significant harm to CMC and Danieli, imposing steep duties on this 

customized steel manufacturing equipment will undermine the broader U.S. interest in expanding 

domestic steel manufacturing.25 Following investigations carried out under Section 232 of the 

Trade Expansion Act of 1962, President Trump recently imposed tariffs on a wide range of steel 

imports. President Trump imposed this remedy to ensure the long-term viability of the U.S. steel 

manufacturing sector, citing the adverse effects of steel imports on national security.26 

Consistent with the Administration’s goals in the Section 232 investigations, Danieli has 

contracted with CMC—a significant U.S. steel producer—to establish new and improved steel 

manufacturing infrastructure in the United States.27 Yet this project, which is aligned with a key 

objective of the Administration, is directly threatened by the Section 301 tariffs.28 To avoid this 

conflict, we respectfully submit that narrow, temporary exclusions for the highly customized 

equipment being imported for the Mesa project are both necessary and appropriate.

III. Vertical Loopers Are Not A Priority of “Made in China 2025” or other Chinese 

Industrial Policies

Vertical loopers and other steel manufacturing equipment under the CMC contract are not 

strategically important to or a target of Chinese industrial policies, including Made in China 

2025. The Made in China 2025 initiative is forward-looking and targets emerging hightechnology industries, which steelmaking machinery is not. Although steel has long been 

considered a priority sector for industrial policy China, governmental intervention in this sector 

is and should be aimed at reducing rather than expanding capacity. In fact, China has announced 

that the addition of new steel capacity in China is “strictly prohibit{ed}.”29 Under these 

circumstances, the Chinese government has no incentive to strategically target manufacturers of 

 

25 See Procedures to Consider Requests for Exclusion of Particular Products From the Determination of Action 

Pursuant to Section 301: China’s Acts, Policies, and Practices Related to Technology Transfer, Intellectual 

Property, and Innovation, 83 Fed. Reg. 32,181, 32,183 (Dep’t of Commerce July 11, 2018) (inviting requestors to 

comment severe economic harm to the requestor “or other U.S. interests”).

26 See, e.g., Proclamation 9705; Adjusting Imports of Steel Into the United States, 83 Fed. Reg. 11,625 (Mar. 15, 

2018) 

27 See Press Release, CMC Steel (USA) Receives Board Approval for Plate Mill Modernization, Selects Danieli for 

the Project (June 19, 2017) (Att. B) (“‘This is the perfect time in U.S. history to implement our vision; we finally 

have an environment that supports the expansion and technological advancement of the domestic steel industry,’ 

Hritz added. ‘We at CMC (USA) feel this project is fully in sync with rebuilding the American infrastructure 

promoted by the Trump administration.’”). 

28 Tariffs on steel manufacturing equipment could have the unintended consequence of supporting steel production 

outside the United States to the detriment of steel production inside the United States.

29 See State Council Guiding Opinions on Reducing Overcapacity in the Iron and Steel Industry, State Council (Feb. 

4, 2016). 
PUBLIC ATTACHMENT

Rationale for Exclusion

October 9, 2018

Page 4

steelmaking machinery. Imposing Section 301 duties on such machinery would be neither 

“practicable” nor “effective” to “obtain the elimination of China’s {unfair} acts, policies, and 

practices.”30

Additionally, the injurious intellectual property practices that this Section 301 

investigation seeks to remedy are not an issue for Danieli or other firms that manufacture 

steelmaking equipment in China. Indeed, Chinese companies already have the technology to 

manufacture equipment similar to the machines covered by Danieli’s exclusion requests in 

support of the Mesa project. There is thus no need for the Chinese government to target this 

sector for intellectual property theft. 

* * * * *

For the foregoing reasons, Danieli respectfully requests that USTR grant a product 

exclusion for certain highly customized, project-specific vertical loopers imported under HTSUS 

subheading 8428.90.0290 from the determination of action pursuant to Section 301 of the Trade 

Act of 1974. We appreciate the Administration’s consideration of this request. 

I hereby certify that the information provided in this submission is complete and correct 

to the best of my knowledge.

Sincerely,

/s/ Luca Rossetto

Luca Rossetto 

CEO 

Danieli Corporation

 

30 See Notice of Determination and Request for Public Comment Concerning Proposed Determination of Action 

Pursuant to Section 301: China's Acts, Policies, and Practices Related to Technology Transfer, Intellectual 

Property, and Innovation, 83 Fed. Reg. 14,906, 14,908 (Apr. 6, 2018) (requesting comments from parties on 

whether “imposing increased duties on a particular product would be practicable or effective to obtain the 

elimination of China’s acts, policies, and practices . . . .”).
Danieli Corporation

600 Cranberry Woods Drive,

Suite - Cranberry Township,

PA 16066

P.O.Box 640039 Pittsburgh

PA 15264-0039

Phone (724) 778-5400

Fax (724) 778-5401

5

COMPANY CERTIFICATION

I, Luca Rossetto, acting as CEO for Danieli Corporation, certify that I prepared or otherwise 

supervised the preparation of the attached submission as well as the accompanying “Form to 

Request Exclusion of Product,” filed on October 9, 2018, in Section 301: China’s Acts, Policies, 

and Practices Related to Technology Transfer, Intellectual Property, and Innovation, Docket 

No. USTR-2018-0025. I certify that disclosure of the information bracketed in the business 

confidential version of the submission, and redacted from the public version, would endanger 

trade secrets or profitability, and that the information would not customarily be released to the 

public. 

Signature: /s/ Luca Rossetto

Date: October 9, 2018
ATTACHMENT A 

News Articles and Press Releases 
News Release 

COMMERCIAL METALS COMPANY ANNOUNCES SECOND INVESTMENT IN SPOOLED REBAR AT ITS 

ARIZONA MICRO MILL

Irving, TX – November 29, 2017 - Commercial Metals Company (NYSE: CMC) today announced that the 

company will invest in a second spooler to produce hot-rolled, spooled rebar at its micro mill in Mesa, Arizona.

This investment is in addition to the January 2017 announcement of the first spooler in the United States, which 

will be located at the company’s new micro mill in Durant, Oklahoma. The company expects to begin shipping 

spooled rebar from the Oklahoma mill in the spring of 2018 and from the Arizona mill about one year later.

“We are excited to expand our production capabilities of spooled rebar in the United States. The ability to 

produce and sell spooled rebar from both Oklahoma and Arizona will allow us to reach a broader geographic 

market. The micro mill technology lends itself well to spooled rebar production and allows us to offer spools 

from 1.5 to 4.8 tons. CMC remains committed to supporting and servicing the concrete reinforcing industry with 

new and innovative products.” commented Tracy Porter, Executive Vice President, CMC Operations.

About Commercial Metals Company

Commercial Metals Company and its subsidiaries manufacture, recycle and market steel and metal products, 

related materials and services through a network including four electric arc furnace (“EAF”) mini mills, an EAF 

Micro mill, a rerolling mill, steel fabrication and processing plants, construction-related product warehouses, 

metal recycling facilities and marketing and distribution offices in the United States and in strategic international 

markets.

Forward-Looking Statements

This news release contains forward-looking statements regarding the Company's expectations relating to U.S. 

construction activity and the Company's operating plans. These forward-looking statements generally can be 

identified by phrases such as we, CMC or its management "expects," "anticipates," "believes," "estimates," 

"intends," "plans to," "ought," "could," "will," "should," "likely," "appears" or other similar words or phrases. 

There are inherent risks and uncertainties in any forward-looking statements. Although we believe that our 

expectations are reasonable, we can give no assurance that these expectations will prove to have been correct, and 

actual results may vary materially. Except as required by law, the Company undertakes no obligation to update, 

amend or clarify any forward-looking statements to reflect changed assumptions, the occurrence of anticipated or 

unanticipated events, new information or circumstances or otherwise.

Media Contact:

Public Relations – Susan Gerber

214-689-4300
 	



	


	
 
In the spring of 2018, Commercial Metals Company will begin commercial shipments from our new minimill steelmaking facility in Durant, 

Oklahoma. In addition to producing straight-length rebar, this state-of-the-art facility will be the first and only producer of SPOOLED REBAR 

in the United States.

For the rebar fabrication industry, using traditional loose-wound coiled rebar on automatic bending machines was an improvement in 

production over straight-length rebar fabrication. While coiled rebar has benefits, it also presents a wide range of challenges including small, 

size-limited coils, twisting of the rebar causing difficulty feeding bending machines, difficulty straightening twisted bar, frequent tangles 

during de-coiling, unstable stacking and storage concerns and varying linear feet of rebar from coil to coil.

CMC’s new and improved SPOOLED REBAR alleviates these challenges. Until now, domestically-produced rebar for automatic bending 

machines was only available in loose coils. CMC’s spooled rebar will be available in sizes #3 to #6 and in 1.5 up to 4.8 ton spools allowing you 

to choose the spool size that best fits your shop’s capabilities.

SPOOLS PROVIDE A COMPETITIVE ADVANTAGE

Larger spools decrease change-out downtime thus increasing production uptime and output per 

hour, material yield and safety. In addition, production is positively impacted with no twisting

during straightening allowing multi-stranding which increases productivity while producing truer 

shapes with minimal need to further refine final fabricated product. Safety is improved with more 

stable, tighter stacks that are easier to store, stage, load and transport compared to loose coil. 

Spooled rebar gives fabricators an added competitive edge with the precise measurement of

rebar linear footage per spool allowing you to optimize production by knowing the exact linear

feet you purchased.

SIZES AND GRADES

Our hot-rolled, spooled rebar will be produced in #3 thru #6 bar to ASTM specifications.

By adhering to CMC’s Guiding Principle of “Placing the Customer at the Core of All We Do”,

we continue to work with our customers to find innovative ways to better serve them. For more 

information, visit our website at cmc.com/spooledrebar, email spooledrebar@cmc.com or

contact your local CMC sales representative.

COMMERCIAL METALS COMPANY

SPOOLED REBAR

The Latest Innovation in Rebar from CMC.

RECYCLING | MILLS | FABRICATION | MARKETING & DISTRIBUTION | WWW.CMC.COM

A CENTURY OF INDUSTRY EXPERIENCE Founded in 1915, Commercial Metals Company and its subsidiaries recycle, manufacture and market steel, metal products and related materials through a network of facilities 

throughout the United States and around the globe. As a publically traded company (NYSE: CMC) on the Fortune 1000 list, our long-standing professionalism and exceptional level of service have been recognized among 

the best in our industry. We set the standard for being an environmentally responsible, efficient, high quality, and low cost metal recycler, steel manufacturer and fabricator.

BENEFITS OF SPOOLED REBAR

Twist-free spools:

> Result in safer, tangle-free de-coiling

> Reduce waste due to improved bar

straightness resulting in fewer rejects

> Increase productivity by multi-stranding

twist-free bar

Larger spool sizes:

> Minimize yield loss from increased linear

feet per spool

> Increase productivity rates by reducing

change-out downtime

High-tonnage and ultra-compact spools:

> Minimize inventory storage space needs

> Minimize handling and transportation costs

> Improve safety in shipping, handling and

machine loading