AD/CV Investigations on China Hardwood Plywood to Continue as ITC Finds Preliminary Injury
Antidumping and countervailing duty investigations on hardwood and decorative plywood from China will continue after the International Trade Commission voted unanimously that U.S. industry is injured by dumped and subsidized imports. The ITA is set to issue its preliminary determination on Dec. 12 for the CV duty investigation, and March 6 for the AD duty investigation, although both deadlines are extendable.
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“The outcome of this case before the ITC will have a far reaching effect on your supply chain and create a level of tremendous uncertainty in the market place for at least five years,” said the American Alliance for Hardwood Plywood, which opposes the imposition of AD/CV duties. “If the petitioned tariff is approved, up to half the world’s supply of hardwood plywood would be unavailable to U.S. manufacturers, creating an economic advantage for overseas producers of these products.”
Chinese hardwood plywood is used by producers of furniture and cabinetry; componentry for marine, aircraft, and recreational vehicles; and hundreds of other products that are painted or laminated, AAHP said. The Chinese plywood is substantially different from the decorative hardwood plywood produced domestically. The Chinese product is made from fast growing, short rotation hardwoods that can be harvested in as few as six years, it said, and is stronger and lighter than domestic plywood. The domestic product is typically produced with softwood cores and decorative face veneers made from woods available only in North America, said AAHP.
The AD petition, which was filed by the Coalition for Fair Trade of Hardwood Plywood, alleges dumping rates of 310.02 percent. “Because of significant underselling by unfairly traded imports from China, U.S. producers have lost a substantial volume of sales, resulting in extremely low rates of capacity utilization and a razor thin profit margin,” said CFTHP in the petition.
According to CFTHP, the share of the U.S. hardwood plywood market captured by imports from China has grown from single- or low double-digits to about 50 percent over the last several years. The increased market share is the result of Chinese dumping and subsidization, it said. Chinese dumping and subsidization “present a fundamental, if not insurmountable, obstacle to the domestic industry’s ability to recover its competitive footing, even when underlying economic conditions in this country turn more favorable,” CFTHP said in a statement released alongside the filing of the AD/CV petitions.
(See ITT’s Online Archives 12102314 for summary of the ITA’s initiation of the investigations.)