U.S. Slaps Tariffs on Steel From 12 Nations : Trade: The Commerce Department says the countries unfairly subsidize their imports.

The Commerce Department on Monday said that 12 countries, most in Europe, are unfairly subsidizing steel imported into the United States and ordered temporary duties as high as 90% on the foreign products.

The long-awaited decision comes against the backdrop of growing trade tension between the United States and Europe. An agricultural trade war was averted nearly two weeks ago by a U.S.-European farm subsidy agreement, but European farmers have continued to show their anger--on Monday pelting the U.S. Embassy in Madrid with fruit and potatoes.

The Commerce Department decision is expected to help the U.S. steel industry, which has been hoping to raise prices next year. But it could also mean higher prices for products that use foreign steel.

“This is real serious business,” said Selwyn Enzer, a USC business professor who specializes in international business issues. “They’re trying very desperately to level the playing field finally.”

A flurry of complaints was filed by the U.S. steel industry in June against foreign countries that it contended were competing unfairly by subsidizing their industries and by “dumping” steel products at prices below fair market value in the United States. The industry has said that unfair trade practices by foreign steel producers have cost tens of thousands of U.S. jobs and threaten thousands more.

Foreign steel accounted for about 18% of the U.S. market last year.

The department said steel producers in Austria, Belgium, France, Germany, Great Britain, Italy, Spain, Mexico, Brazil, Sweden, South Korea and New Zealand were enjoying unfair government subsidies ranging from less than 1% to as high as 90%. Four different kinds of steel--some of which is used in appliances, automobiles and construction--were involved.

The Commerce Department said it assessed duties on importers of the foreign steel to offset the price advantage caused by the subsidies.

U.S. steel producers said, in a joint statement, that the decision “confirms that foreign government subsidies on a massive scale are adversely affecting fair trade of steel in the U.S. market. . . . No one who believes in the established rules of free trade can possibly defend the market distortions which are documented in this ruling.”

But a spokeswoman for the European Community told the Associated Press that the U.S. government was using trade policy to solve structural problems in the domestic steel industry.

“The U.S. government is using legitimate trade policy instruments and exploiting them to harass foreign competitors and divert world trade flows, unduly blaming imports for what are primarily domestic problems of the American steel industry,” Ella Krucoff said.

If the duties hold, prices will be higher for imported steel and the products that use it, said Richard L. Drobnick, director of USC’s International Business Education & Research program.

“The person who buys it won’t like it, but in the U.S., we have certain rules” governing trade, Drobnick said.

Monday’s preliminary decision will not become final until the International Trade Commission determines that domestic producers have been injured. A decision is expected by mid-1993.

In the meantime, the government will collect the preliminary duties, requiring importers to post a cash deposit or bond to cover the duties within a week, a Commerce Department spokesman said.

The highest estimated subsidy, 90.09%, was provided by Mexico for one type of corrosion-resistant carbon steel product. The lowest was a 0.64% subsidy by Germany on one type of carbon steel plate.

The complaints were filed by Armco Steel Co., Bethlehem Steel, Geneva Steel, Gulf States Steel Inc., Inland Steel Industries Inc., Laclede Steel Co., LTV Steel Co., Lukens Steel Co., National Steel Corp., Sharon Steel Corp., USX Corp.’s U.S. Steel Group and Warren Consolidated Industries.

The department is still reviewing subsidy cases involving Argentina, Australia, Canada, Finland, the Netherlands, Poland and Romania. A preliminary decision on anti-dumping cases involving 19 countries is expected in January.