The Impact of AD & CVD on the U.S. Hardwood Plywood Industry

US importers need to be very careful while sourcing goods and items from China. The two recent decisions taken by the U.S. Commerce Department on expanding antidumping (“AD”) and countervailing duty (“CVD”) on hardwood plywood to cover ready to assemble cabinets will likely to take its toll on the US importers of the Chinese products. The high 183.36 percent antidumping duties, together with additional countervailing duties of 22.98 percent for most companies, will apply to the unique hardwood plywood made by China that cannot be produced in the United States.

From the month of September 2018, the U.S. Commerce Department issued a final scope ruling on Ready To Assemble (“RTA”) Cabinets in the Hardwood Plywood AD and CVD case, finding no exclusion for RTA cabinets. As a result of today’s decisions, Commerce will instruct U.S. Customs and Border Protection (CBP) to collect cash deposits from importers of hardwood plywood products from China based on the final rates. Based on affirmative final determinations by the Department of Commerce (Commerce) and the International Trade Commission (ITC), Commerce is issuing the countervailing duty order on certain hardwood plywood products (hardwood plywood) from the People’s Republic of China (China).

The Impact of Countervailing Duty (“CVD”) on Hardwood Plywood-

Such evasion can include transshipment of products subject to AD/CVD orders through third countries, misrepresentation of foreign supplier names, and failure to properly identify imported goods as subject to AD/CVD orders. Critically, evasion findings can be retroactive to a date before a target even becomes aware of the existence of an investigation because there is no public announcement of initiation. The antidumping duties address unfair pricing tactics and the countervailing duties address Chinese government subsidization of Chinese manufacturers. Foreign companies that price their products in the U.S. market below the cost of production or below prices in their home markets are subject to AD duties. The International Wood Products Association (IWPA) is disappointed to report that the U.S. International Trade Commission voted 4-0 in favor of the Petitioners in the Chinese Plywood antidumping and countervailing duty (AD/CVD) case.

The antidumping and countervailing duty cases were filed on behalf of the Coalition for Fair Trade of Hardwood Plywood, a group of six producers and manufacturers that are committed to safeguarding the U.S. hardwood plywood industry and its thousands of workers.

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