Commerce finds China subsidizes plywood exports
The Commerce Department has determined the Chinese government subsidizes hardwood and decorative plywood production which is then exported to the United States.
Specifically, the department determined on Feb. 27 that producers/exporters from China have received countervailable subsidies ranging from 0.22 percent (de minimis) to 27.16 percent. Linyi City Dongfang Jinxin Economic & Trade Co., Linyi San Fortune Wood Co., and Shanghai Fancywood Inc. (or Shanghai Senda Fancywood Industry Co.) have each received countervailable subsidies that are de minimis, according to responses received from these companies by Commerce.
For each of the 15 companies that did not respond to Commerce’s Quantity and Value Questionnaires, which is used for purposes of respondent selection, the department has applied a rate of 27.16 percent ad valorem based on adverse facts available for their failure to provide the requested information. All other Chinese producers/exporters have been assigned a preliminary subsidy rate of 22.63 percent ad valorem which reflects an average of the de minimis rates and the adverse facts available rates.
Commerce will now instruct U.S. Customs and Border Protection to collect a cash deposit based on these preliminary rates. Imports that are produced and exported by Dongfang, San Fortune and Senda will not be subject to cash deposit requirements because the subsidy rate for these companies is de minimis which results in a preliminary negative determination for them, the department said.
The petitioner for this Commerce investigation is the Coalition for Fair Trade of Hardwood Plywood, whose members include Columbia Forest Products, Greensboro, N.C.; Commonwealth Plywood Inc., Whitehall, N.Y.; Murphy Plywood, Eugene, Ore.; Roseburg Forest Products Co., Roseburg and Dillard, Ore.; States Industries, Eugene, Ore.; and Timber Products Co., Springfield, Ore.
Hardwood and decorative plywood is a flat panel composed of two or more layers or plies of wood veneers in combination with a core. The veneers, along with the core, are glued together to form a finished product. The plywood panel must have face and back veneers which are composed of one or more species of hardwoods, softwoods, or bamboo.
In 2011, imports of this plywood from China were valued at $616.5 million.
Meanwhile, there's a companion U.S. antidumping investigation on Chinese hardwood and decorative plywood imports. The preliminary determination in that investigation is due at the end of April. Because the deadline for the final determination in the countervailing duty investigation has been aligned with the deadline for the final determination in the antidumping investigation, the due date for both final determinations is currently July, but that date can be extended, Commerce said.
If Commerce makes an affirmative final determination, and the U.S. International Trade Commission makes a similar decision that imports of hardwood and decorative plywood from China unduly harm the domestic industry, Commerce will issue countervailing duty and antidumping orders. If either Commerce or the ITC’s final determination is negative, no orders will be issued.