The agreement with Russia, announced by the US commerce secretary William Daley, would limit Russia's export of hot-rolled (HR) steel, a basic industry product, to 1996 levels and set a minimum price that Russian exporters could charge. Russia also agreed to cap exports to the US of other steel products at 1997 levels, he added. Daley said the deal, which is subject to a public comment period, would help the domestic industry recover from a flood of cheap imports last year while avoiding damage to the struggling Russian economy. "All these actions are intended to provide much needed relief to the US steel industry and workers, who have faced dramatic surges in unfairly traded imports over the past year," Daley said.But, he said the US "did not want to bring Russia to itsknees." Steel represents about 7 per cent of the Russian economy, he said. The steel makers in the country said they were angry over the deal and may sue the US government.

"I have spoken with other steel industry leaders and that would be an option we would consider," said Paul Wilhelm, president of the US Steel, the nation's largest steel maker. Wilhelm said in Pittsburgh that he was "very disappointed and very upset with the Clinton administration." The industry could challenge the decision in the US court of International Trade, but it could take as long as a year for a ruling. "We're very disappointed," said a spokesman for LTV Corp, the third largest US integrated steel manufacturer. The country's steel imports last year soared to record levels in the face of a strong economy and weak demand in crisis-stricken Asia, Latin America and Russia. The steel industry in the country had accused Russia of dumping steel in the US market, selling it at less-than-fair value. The complaint involving HR steel alsoincluded Japan and Brazil. The industry since has filed other anti-dumping complaints against more countries and products.

The Commerce Department said earlier this month it found evidence Japan and Brazil were dumping steel and also said that the latter was subsidising its exports to the US. It set hefty preliminary anti-dumping and subsidy duties against imports. Brazil has approached the US with an offer to make a deal similar to the one with Russia. Brazil would restrict exports to the country in exchange for an end to the proposed duties. Daley said he received a letter from Brazilian foreign minister Luiz Felipe Lampreia and said that Washington would talk about a deal with Brazil.