ITC to continue probe into China PC strand

U.S. Commission issues unanimous affirmative preliminary decision in trade action against PC strand from China.

The U.S. International Trade Commission today preliminarily determined that unfairly traded imports of prestressed concrete steel wire strand ("PC strand") from China are threatening material injury to the domestic PC strand industry. The Commission issued a unanimous finding, with all six members of the Commission voting in the affirmative. The trade action was filed on May 27, 2009, by American Spring Wire Corp., Insteel Wire Products Co, a wholly-owned subsidiary of Insteel Industries, Inc., and Sumiden Wire Products, Corp., alleging injurious unfair trade practices by imports of PC strand from China. The Commerce Department initiated an antidumping investigation on June 16, 2009, citing estimated margins of dumping ranging from 140.16 to 314.59 percent. Commerce simultaneously initiated a countervailing duty investigation against PC strand from China, identifying over 30 programs as providing potential subsidies to Chinese PC strand producers and exporters. According to information submitted by petitioners, imports from China alone have surged to levels far in excess of collective import volumes from five other countries - Brazil, India, Korea, Mexico, and Thailand - found to cause injury to the PC strand industry in 2003. Imports from China have captured 40 percent of the U.S. market at the expense of competing U.S. producers. Petitioners assert that these import gains by China were based on widespread underselling practices. As a result, the domestic industry has seen its operating profit to sales ratio fall from a double-digit profit in 2006 to a double-digit loss by the first quarter of 2009. H. O. Woltz III, President and CEO of petitioner Insteel Wire Products, stated: "We applaud the Commission's preliminary decision in our favor as a first step toward remedying the problems we have suffered due to these unfairly traded imports. Our industry has lost substantial sales volume to China and has seen huge declines in our production, shipments and employment as Chinese imports use dumping behavior and government subsidies to undercut our prices." The next step in the trade action will be the issuance of preliminary determinations as to dumping and subsidies by the Commerce Department. The current deadline for the imposition of these preliminary decisions is August 28, 2009, in the countervailing duty case and November 3, 2009, in the antidumping case. If affirmative preliminary decisions are issued by Commerce, importers must begin to post cash deposits or bonds on all future entries of PC strand from China in the amount of the subsidy or dumping margin calculated by Commerce. Thus, as of late August, importers of PC strand may be liable for significant duties if Commerce confirms the subsidy allegations by the petitioners. PC strand is a steel strand produced from brite wire of carbon steel, suitable for use in prestressed concrete. The petitioners are American Spring Wire Corp. of Bedford Heights, Ohio; Insteel Wire Products Co. of Mt. Airy, North Carolina, a wholly-owned subsidiary of Insteel Industries, Inc.; and Sumiden Wire Products Corp. of Dickson, Tennessee. Petitioners are represented in these actions by Kathleen W. Cannon and Paul C. Rosenthal of the law firm Kelley Drye & Warren, LLP.