US Importer Calls Ruling on Chinese Hardwood Plywood Inexplicable

Shelter Forest International Also Says Ruling Threatens More Jobs Than It Protects

PORTLAND, OR--(Marketwire - Mar 4, 2013) - In an effort to protect 1,800 US manufacturing jobs, the US Department of Commerce has inexplicably chosen to impose an exorbitant countervailing duty on most manufacturers of Chinese hardwood plywood even though a sampling of these mills indicated no basis for a duty. The action may also have inadvertently threatened the livelihoods of more than 20,000 US cabinet makers, boat builders, furniture makers and other American craftsmen and manufacturers according to the President of Shelter Forest International (SFI), a leading importer of hardwood plywood and Interested Party in the trade case.

SFI President Ryan Loe, said that the US Department of Commerce's Preliminary Determination in the Countervailing Duty (CVD) Investigation on hardwood plywood imports from China will result in steep duties on the majority of hardwood plywood imported and dramatically increase the cost of these materials for hardworking American craftsman and small businesses.

DOC unprecedented decision will benefit three companies at the expense of all others

"While more than 85 Chinese exporters fully complied with the Commerce Department's investigation, only three were chosen for intense examination as to whether countervailable subsidies were received by Chinese exporters. Based on a sampling of those three companies, the Agency determined there was no basis for imposing a countervailing duty," said Loe. "That is, the Commerce Department explicitly found based on its thorough investigations that the three sample Chinese producers had not received countervailable subsides. Yet inexplicably, Commerce decided to ignore its own finding and impose an exorbitant CVD duty (23%) on all other exporters who also fully complied with the Commerce Department's investigation. 

"It is baffling to me that after the Commerce Department preliminary investigation was completed and a determination was made that no duty was warranted based on a sampling of three mandatory responders, and yet somehow the Agency determined it was necessary to apply a steep duty on products imported by everyone else."

DOC decision threatens more US jobs than it protects

"In a misguided effort to protect American jobs within the domestic hardwood plywood manufacturing sector, the Commerce Department has now jeopardized the livelihoods of more than 20,000 US citizens who will be affected when the inevitable outsourcing of production occurs due to the burden in material costs that will affect American craftsmen and manufacturers." 

Loe cites previous testimony before the International Trade Commission, by such organizations such as the Kitchen Cabinet Manufacturers of America (KCMA), that have explained that the highly specialized hardwood plywood imported from China is not available from US manufacturers and that imposing steep duties would only shift production of finished cabinets overseas where more affordable access to the unique plywood would be available. (See link to Oct. 18th, 2012 KCMA testimony).

Said Loe, "The hole in the supply chain caused by this duty will not be filled with domestically produced materials, but rather shifted from the well-managed sustainable forests, back to the mismanaged old growth and ancient forests, utilizing endangered tropical species, resulting in a step back in the environmental advancements in sustainable forestry of the past few years." 

Shelter Forest International (SFI), an American company that manages the global supply chain for TigerPLY™ hardwood plywood, used by thousands of US manufacturers, has been working on building partnerships with wood fiber suppliers in China for the past decade. SFI's unique relationships have allowed the company to engineer specialty plywoods for a number of industries such as marine, recreational vehicles, furniture components and cabinet manufacturers.

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