WASHINGTONSept. 17 is the next major milestone in the antidumping and countervailing duty investigation against certain passenger and light truck tire imports from China, according to the U.S. Department of Commerce, although the final determination of dutiesif so orderedwon't be until mid-January for dumping duties and April for countervailing duties.
On Sept. 17, Commerce is scheduled to make its preliminary determination on the amount of subsidies the Chinese government gives to Chinese tire makers, the agency said.
A final determination on subsidies is due from Commerce Dec. 1, the same day the agency is scheduled to make a preliminary determination on dumping marginsthat is, the percentages below which Chinese tire makers may be undercutting the prices of U.S. tire manufacturers.
If Commerce makes affirmative findings in both cases, the International Trade Commission (ITC) will make a final determination Jan. 15, 2015, on whether the U.S. tire industry is being materially injured by Chinese imports. If the ITC finds material injury, it will issue a countervailing duty order Jan. 22, 2015.
In the case of antidumping duties, the ITC will make a final determination on material injury March 31, 2015, and issue antidumping duty orders April 7, 2015.
The United Steelworkers (USW) union petitioned the ITC for relief June 3 under Sections 701 and 731 of the Trade Act, asking for antidumping and countervailing duties against certain Chinese consumer tire imports. Commerce decided July 15 to initiate an investigation, and the ITC voted 6-0 on July 22 to continue the investigation.
USW International President Leo W. Gerard said he was pleased by the commission vote.
Today's decision by the ITC to proceed on the Steelworkers' petitions seeking relief from unfairly traded Chinese tires is critical to the thousands of workers in this industry.
However, Tire Industry Association Executive Vice President Roy Littlefield said the trade group is disappointed but not surprised. We had feared from the beginning that this was on a fast political track.
Attorneys representing the China Rubber Industry Association and the China Chamber of Commerce of Metals, Minerals & Chemical Importers could not be reached for comment on the ITC vote.
In an analysis accompanying its July 15 decision to initiate the investigation, Commerce found preliminary dumping margins of 45.8 to 87.99 percent on selected Chinese tires, as well as subsidy rates above de minimis.
De minimis, according to the agency, is a subsidy of less than 1 percent for developed countries and less than 2 percent for developing countries.
The ITC found that imports comprised 47 percent of the value of the U.S. consumer tire market in 2013, or $10.5 billion of a total market of $22.3 billion.
Chinese imports accounted for $2.3 billion, or nearly 22 percent, of the import total, with Canada, South Korea and Japan also major importers.
The ITC's figures differ slighly from data published by Commerce. Those data show the value of the combined passenger/light truck tire imports last year at $9.83 billion, with China accounting for $2.09 billion.
The ITC reported there are nine tire manufacturers in the U.S., operating factories in 14 statesAlabama, Arkansas, Georgia, Illinois, Indiana, Kansas, Mississippi, New York, North Carolina, Ohio, Oklahoma, Pennsylvania, South Carolina, and Virginiawith a combined employment of approximately 29,000.
The USW represents about 22,000 tire industry workers.
Shandong Provincehome to about 70 tire manufacturers, would be seriously impacted if U.S. anti-dumping tariffs are passed, according to Fang Xiaojie, head of the fair trade division of the Department of Commerce of Shandong Province.
In 2013 Shandong exported $1.7 billion worth of tire-related products to the U.S., accounting for 51 percent of the country's total, Mr. Xiaojie said, adding that although the new tariffs would cause great damage with almost doubled export price to the U.S., it's unlikely to lead to many closedowns.
A majority of relevant companies still focus on the domestic market and also have export business to Africa and the Middle East.
The China Rubber Industry Association declined to comment on the anti-dumping investigation. However, China's Ministry of Commerce opposes the duties, saying the move breaches the rules of the World Trade Organization and U.S. laws.
The ministry issued its position statement July 18 but did not attribute it to any one individual.
The U.S. investigation was initiated despite serious flaws in the application for the investigation and opposition from the U.S. tire industry and related sectors, according to the statement. The ministry said it believes the 2009-12 tariffs case resulted in serious harm to China-U.S. trade ties, the official said.
The facts show that the special safeguard measures taken by the United States have brought about substantial damage to its tire industry, the statement said, and it has harmed others without benefiting itself to take protectionist measures to restrict free trade and market competition.
China is against the abuse of trade remedy measures and hopes the United States can learn lessons and prudently handle the case so as to not harm trade and cooperation between the two countries.
China's Ministry of Commerce Gao Hucheng, in a speech delivered July 17, accused the U.S. of being a serial abuser of international trade rules when it comes to applying anti-dumping and countervailing trade measures against Chinese products. As a result, Mr. Hucheng is urging the U.S to inject more positive vigor into the development of China-U.S. trade and economic relations.
This story is based on reporting by Miles Moore, Senior Washington reporter, and Tire Business staff members.