The US Department of Commerce has launched price dumping proceedings against foreign steel firms, including two German producers, suspecting they may be selling stock at unfairly low prices to undercut US producers.

In response to the measure, former German economy minister and current foreign minister Sigmar Gabriel urged Brussels to push the US to respect World Trade Organization (WTO) rules when judging the case.

In a letter to EU trade commissioner Cecilia Malmström he said German manufacturers had "nothing to fear" from fair competition on global steel markets, and added: "US competitors may hope that the new US government would be ready to allow them unfair dumping competition, even when that infringes the rules. We Europeans can't allow that."

In Gabriel's judgment, it was "extremely important to take a clear position and not to start transatlantic trade dialogue with the new US government with a negative and unjustified decision."

If EU steelmakers are found to be selling steel at unfair prices and forced to pay high tariffs in the US, they could face massive disadvantages in international competition, Gabriel fears.

'America first'

President Donald Trump has vowed to bring manufacturing jobs back to the US, if necessary by imposing heavy tariffs on imported goods. However, the plan runs counter to long-standing global consensus on free trade outlined in WTO rules.

Indication of Trump's willingness to act through on his "America first" policy could be seen at last week's finance ministers meeting of the G20 which failed to get Washington to sign off on a traditional pledge to reject protectionism.

Meanwhile, both the US and the EU have sought to protect domestic steelmakers in recent months by slapping tariffs on some Chinese steel products.

China makes more than half the world's steel but a slowdown in its economy and sagging global demand has left the industry with huge excess capacity. It has been accused of dumping its production on world markets, sinking prices and violating international trade agreements.

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uhe/mds (AFP, dpa)