China's Tire Makers Not Deflated By Dumping Duties

Tag : chinese tires
HONG KONG -
The U.S. Commerce Department on Tuesday set final anti-dumpingduties of up to 210% on millions of Chinese-made off-road tires forbig trucks and other commercial/industrial vehicles. However,Chinese tire manufacturers are expected to see limited impact fromthe ruling amid a global shortage of such tires.
The Commerce Department found that the Chinese tires were beingsold in the United States at unfairly low prices and announcedfinal anti- dumping duties of up to 210.48%, as well as countervailing duties of up to 14%. "After a thorough investigation, the Department ofCommerce has found that Chinese exporters of off-the-road tireshave received government subsidies and sold at below the cost ofproduction in the United States," said Assistant Commerce SecretaryDavid Spooner.
The U.S. International Trade Commission could reduce the duties setby the Commerce Department if it determined that the off-road tireimports have not materially harmed U.S. producers. A final judgmentis expected to be made in August.

The Sino-American tire dispute began last year when Titan Tire, aDes Moines, Iowa-based company that makes off-road tires foragricultural, construction and industrial vehicles, together withthe United Steelworkers union, filed two cases asking for importrelief. Titan's complaints were seconded by the Nashville,Tennessee-based U.S. subsidiary of Japan's Bridgestone (other-otc: BRDCY - news - people ), the world's largest tire and rubber company.
The Commerce Department responded in December by settingpreliminary countervailing duties for Chinese tire exportersranging from 2.38% to 6.59% to match the subsidies it estimatedthey have received.

Although China protested the ruling , characterizing it as discrimination against its products, Chinesetire manufacturers did not see a drastic drop in their business.Chinese-fabricated off-road tires make up about four-fifths of U.S.imports, which amounted to about 12.4 million in 2005 and rose tonearly 15.0 million in 2006. After the Commerce Department imposedits initial preliminary anti-dumping duties, in 2007, importsdeclined only slightly, to 13.7 million that year.
In addition, the final duties announced Tuesday were in many caseslower than the preliminary levels. Xuzhou Xugong Tyre Co., whosepreliminary duty of 51.81% was knocked down to zero, saw thebiggest change. More than 40 other Chinese tire makers andexporters received a final anti-dumping duty of 9.48%, down from apreliminary rate of 24.75%. But an unspecified number of Chinesesuppliers will still face a 210.48% anti-dumping duty and anadditional 5.62 % countervailing duty on their exports.
The outlook for off-road tire manufacturers is propitious becausethere is a global shortage of giant tires up to 12 feet in diameteramid the boom in commodities and mining. Tire makers are speedingup their production of off-road tires to meet the rising demand.Bridgestone has decided to build a new plant at Kitakyushu, inJapan's Fukuoka prefecture. It aims to boost its output of largeand ultralarge radial tires by 40% by 2012.
-- Reuters contributed to this article.