Sino-US rift set to grow as trade panel finds China aluminium ‘materially injured’ American industry, allows probe

US President Donald Trump ‘made it clear from day one that unfair trade practices will not be tolerated’, Commerce Secretary Wilbur Ross says

PUBLISHED : Saturday, 13 January, 2018, 7:04am
UPDATED : Saturday, 13 January, 2018, 6:23pm

The US Department of Commerce received a judicial ruling authorising it to continue its investigation into whether aluminium alloy sheet metal from China was being dumped or unfairly subsidised, adding to worries of a worsening rift between the world’s two largest economies.

The US International Trade Commission, a bipartisan, quasi-judicial federal agency in charge of administering US trade remedy laws, determined that US industry was “materially injured by reason of imports of common alloy aluminium sheet from China that are allegedly subsidised and sold in the United States at less than fair value”, according to a news release on Friday.

In November, the US Commerce Department launched a “self-initiated” anti-dumping investigation into Chinese aluminium alloy sheet – the first time the US had taken such an action against a trading partner since 1991.

All four ITC commissioners voted affirmatively in support of the government’s trade remedy claims and further action in its investigation.

US Secretary of Commerce Wilbur Ross, who launched the investigation into imports of Chinese aluminium alloy sheet, said US President Donald Trump “made it clear from day one that unfair trade practices will not be tolerated under this administration, and today we take one more step in fulfilling that promise”.

The US’s action drew an expression of “strong dissatisfaction” from China’s Ministry of Commerce.

In a statement, it said the continuing investigation would harm US-China aluminium products trade, hurting both countries’ interests.

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The ministry said also that it would adopt the necessary measures to safeguard Chinese firms’ legal interests.

The US commerce department’s preliminary countervailing duty determinations are set to be delivered about February 1, and its anti-dumping determinations on April 17, the news release said.

The department estimated in its preliminary findings that the dumping margins of such Chinese aluminium products into the US market are from 56.54 per cent to 59.72 per cent, indicating that the anti-dumping duty could be in the same range. No estimated subsidy rate has been specified.

In 2016, imports of common alloy sheet from China were valued at an estimated US$603.6 million.

China’s trade surplus with the US hit a record high last year, rising 8.6 per cent year on year to US$275.8 billion – or about 65 per cent of China’s total global trade surplus, China’s General Administration of Customs said on Friday in Beijing.

The ITC commissioners’ unanimous vote was applauded by the Aluminium Association, which represents producers of the metal and worked with the commerce department on the investigation.

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“US companies that make common alloy aluminium sheet have suffered extensive injury thanks to unfairly traded imports from China for many years,” the group’s president, Heidi Brock, said.

But the National Marine Manufacturers Association (NMMA) said the decision was bad news for aluminium boat makers, a big part of a US$3 billion recreational boating industry that claims to support 650,000 US jobs.

“The ruling is expected to significantly drive up the costs of aluminium used to manufacture more than 111,000 boats such as pontoons and fishing boats, which make up 43 per cent of new powerboat sales,” NMMA President Thom Dammrich said.

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Earlier this week, US aluminium products makers sought new protections against Chinese aluminium shipped through Vietnam, asking the commerce department to investigate allegations that China Zhongwang Holdings Ltd is circumventing US duties.

And next week, the commerce department is expected to send the White House the results of its investigation into whether rising aluminium imports are threatening US national security, a probe likely to provide Trump with an opportunity to levy broad tariffs or import quotas on the metal.

Additional reporting from Reuters