For the first time in 20 years, anti-dumping duty and countervailing duty cases against China have been self-initiated by the U.S. Commerce department which has used its discretionary powers to do so.
Imports worth $600 million of common alloy aluminum sheet from China would be at the center of investigations which have been initiated from Tuesday this week. The Tariff Act of 1930 empowered the Commerce secretary Wilbur Ross to self-initiate the investigations, explained commerce officials.
The basis of the cases was the election promise that the U.S. President Donald Trump had made towards the American businesses, workers and farmers, Ross said. “President Trump said he would vigorously enforce our trade laws and be more enforcement-minded than our predecessors. Today’s action shows that we intend to make good on that promise to the American people.”
Ross claimed to possess sufficient evidence of the Chinese government doling out unfair subsidies to manufacturers of aluminum sheet and proof that indicates that the American market was being flooded by Chinese made aluminum sheets that are priced at lower ends of the fair value spectrum and are mostly below the acceptable fair value for the products. “We have available evidence that also indicates U.S. producers of aluminum sheet are suffering injury caused by these imports,” stressed Ross.
According to the department, Japanese semiconductors export into the U.S. in 1985 was the last time that the self-initiated anti-dumping duty investigation was used.
“Imports of aluminum sheet from China into the United States have been significant since 2005 and have increased rapidly over the last three years,” said Ross. “In light of the systemic and significant over-capacity in the Chinese aluminum industry, U.S. producers face the potential for further increases in imports of aluminum sheet from China. We seek trade relationships that are free, fair, and reciprocal — simple principles all should support.”
He would be ready to offer “people power” to allow the department to self-initiate anti-dumping and countervailing duty cases, “By picking strategic cases and initiating them, it will send a message to the people on the other side that we are getting more serious about this,” because he thought of himself as an activist” for U.S. industries, Ross had told senators during his confirmation hearing in January.
There is an estimated demand of 60 million tons for Chinese aluminum globally this year which is more than half of the total demand according to the International Aluminum Institute. It can be recalled that it is about two weeks ago that both Ross and Trump visited China while visiting Asia.
All of the American companies that are importing cheap aluminum from China would have to pay cash deposits to the U.S. Customs and Border Protection in case the Commerce Department concludes that the dumping or unfair subsidization has taken place.
(Adapted from CNBC)