By John Forbes, NWFA
The Coalition of Fair Trade of Hardwood Plywood has successfully petitioned the U.S. Department of Commerce and the U.S. International Trade Commission (ITC) to reopen antidumping and countervailing duty investigations on the imports of certain hardwood and decorative hardwood plywood products being imported from China. The Department of Commerce initiated the investigation Dec. 9, 2016, and a preliminary determination from the International Trade Commission is expected Jan. 3, 2017.
According to this fact sheet issued by the Department of Commerce, the investigation will include hardwood and decorative plywood, as well as certain veneered panels. The investigation excludes structural plywood, products which have a face and back veneer of cork, and multilayered wood flooring, as described in the antidumping duty and countervailing duty orders on the Multilayered Wood Flooring from the People’s Republic of China.
Not unlike Chinese-made engineered wood flooring products, hardwood and decorative hardwood plywood products have steadily gained U.S. market share since 2013. Annual sales of hardwood and decorative plywood were over $2 billion in 2015, and approximately half of that market was captured by Chinese imports. The Coalition of US Plywood Manufacturers asserts that illegal government subsidies such as tax breaks, discounted lands, and raw materials allow these Chinese hardwood plywood products to be sold at below market prices in order to gain an unfair competitive advantage.
The Coalition is requesting a 105.94 anti-dumping duty to cover the gap between the fair market value of the imported hardwood plywood, and the price that the Chinese plywood is actually being sold at.
Not everyone is in agreement on imposing this duty however. The American Alliance For Hardwood Plywood consists of a group of U.S. customers for hardwood plywood made in China that are pushing back against this effort to block less expensive imports. Manufacturers opposed to this tariff are concerned that high duties will limit supplies of plywood they have come to rely on, which will make them less competitive in the global marketplace.
If this all sounds familiar, it is because three years ago, the Coalition successfully petitioned the Department of Commerce to investigate the dumping of Chinese made hardwood plywood products that were substantially the same. The Commerce Department agreed that there were government subsidies, and finalized anti-dumping duties. The ITC however, ruled that the dumped and subsidized products were not damaging or threatening to U.S. producers. The established duties were therefore not imposed.
Stay tuned to see if the Commerce and ITC see it the same way this time around.