October 4, 2023
(This is a summary of the Press Release. Read the full press release here.)
In a significant move to protect the American aluminum industry, the U.S. Aluminum Extruders Coalition, together with the United Steelworkers (USW) union, has launched a legal battle against what they describe as illegal and unfair trade practices by 15 countries. This action, represented by Wiley Rein LLP, marks a pivotal moment in the ongoing struggle of American industries against global trade imbalances.
The Heart of the Matter: Unfair Trade Accusations
The petitions, filed with both the U.S. Department of Commerce and the U.S. International Trade Commission (USITC), allege that countries including China, India, Italy, Mexico, and several others have been flooding the U.S. market with aluminum extrusions priced below fair value, a practice known as dumping. The dumping rates are claimed to be as high as 256%, particularly from China.
Furthermore, the petitions highlight that producers in China, Indonesia, Mexico, and Turkey are benefiting from countervailable subsidies provided by their governments. These subsidies, which range from tax breaks to discounted land and raw materials, give these foreign producers an unfair advantage in the U.S. market.
Impact on the U.S. Aluminum Extrusion Industry
The American aluminum extrusion industry has reportedly faced significant challenges due to these practices. Despite a growing demand, U.S. producers have struggled to expand their production and sales, suffering notable declines in profitability. This situation has not only affected the companies but also the workers, including thousands in the USW, leading to a call for action to protect American jobs and manufacturing.
Legal Recourse: Antidumping and Countervailing Duties
The legal strategy revolves around the imposition of antidumping and countervailing duties. Antidumping duties aim to offset the impact of products sold at less than fair value, while countervailing duties are designed to counteract the unfair subsidies from foreign governments.
A Look at the Numbers: Alleged Dumping Margins
The petitions detail specific dumping margins for each accused country, with China leading at a staggering 256.58%. These figures form the basis of the legal argument presented to the U.S. authorities.
The Commerce Department is expected to decide whether to initiate investigations within 20 days, and the USITC will make a preliminary determination of material injury within 45 days. The entire process is anticipated to conclude around mid-2024, but duties could be imposed on imports of the subject aluminum extrusions much earlier if the circumstances are deemed critical.
Broader Implications and Industry Response
This case is more than just a trade dispute; it’s a stand for American manufacturing and workers. Jeff Henderson, President of the Aluminum Extruders Council, emphasized the need to confront these illegally traded products head-on. Robert DeFrancesco, a partner at Wiley’s International Trade Practice, echoed this sentiment, urging a thorough investigation into these unfair trade practices.
As the U.S. aluminum extrusion industry braces for a year-long legal battle, the outcome of these petitions could have far-reaching implications for trade relations and the global aluminum market. This move by the U.S. Aluminum Extruders Coalition and the USW union is a clear message that the American industry is ready to defend its ground against unfair global trade practices. The coming months will be crucial in shaping the future of the U.S. aluminum extrusion industry and its role in the global market.
Stay tuned for more updates on this developing story.
- Petitioners: The U.S. Aluminum Extruders Coalition and the United Steelworkers (USW) union, represented by Wiley Rein LLP.
- Allegations: Petitions filed against 15 countries (China, Colombia, Dominican Republic, Ecuador, India, Indonesia, Italy, Malaysia, Mexico, South Korea, Taiwan, Thailand, Turkey, UAE, and Vietnam) for unfairly traded imports of aluminum extrusions, causing material injury to the American industry.
- Claims of Unfair Trade:
- Dumping: Aluminum extrusions sold in the U.S. at less than fair value, with dumping rates up to 256%.
- Subsidies: Producers in China, Indonesia, Mexico, and Turkey benefit from countervailable subsidies (like tax breaks, discounted land, and raw materials).
- Impact on U.S. Industry:
- Significant sales losses to American extruders and workers due to these imports.
- Hindered growth and profitability of U.S. producers despite increasing market demand.
- Legal Action:
- Filed concurrently with the U.S. Department of Commerce and the U.S. International Trade Commission (USITC).
- Seeks investigation and application of trade laws against these practices.
- Antidumping and Countervailing Duties:
- Antidumping Duties: To offset products sold at less than fair value.
- Countervailing Duties: To offset unfair subsidies by foreign governments.
- Dumping Margins: Specific alleged rates for each country, with China at the highest (256.58%).
- Next Steps:
- Commerce Department to decide on initiating investigations within 20 days.
- USITC to make a preliminary determination of material injury within 45 days.
- Final determinations expected around mid-2024.
- Product Description:
- Covers a wide range of aluminum extrusions, regardless of form, finishing, or fabrication.
- Includes both assembled and unassembled products, coated or uncoated.
- Scope of the Case:
- Expands on an earlier case against China, covering additional extruded aluminum products.
- Petitioners’ Statement:
- Emphasize the need to protect American manufacturing and workers from these unfair trade practices.
This summary captures the essence of the press release, focusing on the key allegations, actions taken, and the potential impact on the U.S. aluminum extrusions industry.