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US aluminum producers request circumvention probe into Chinese common alloy sheet

Highlights

Domestic industry says China avoiding existing duties

AD, CVD orders put in place in 2018

The Aluminum Association and individual member producers have asked the Commerce Department to launch an investigation to determine if Chinese exporters are circumventing the existing US antidumping and countervailing duties on common alloy aluminum sheet.

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The Aluminum Association's Common Alloy Aluminum Sheet Trade Enforcement Group and its members allege that China is circumventing the existing duties by selling 4017 alloy aluminum sheet for applications typically reserved for 3003 and 3105 aluminum sheet.

In a July 7 filing addressed to Commerce Secretary Gina Raimondo and the International Trade Administration, the association called on Commerce to initiate a minor alternations inquiry.

The existing US antidumping and countervailing duty orders on common alloy aluminum sheet from China were first put in place in February 2019. At the time, the combined cash duty deposit rates for all Chinese exporters and producers were set at 96.33%-176.21%.

A lower cash duty deposit rate of 90.83% was later set for China's Jiangsu Alcha Aluminum and Yinbang Clad Material following an administrative review.

"Given these extremely high cash duty deposit rates, Chinese exporters and producers have a strong incentive to seek to circumvent the orders by altering merchandise in minor respects," lawyers representing the domestic aluminum industry said in the filing to Commerce.

US industry says 4107 imports on the rise

Since the original antidumping and countervailing duties were put into place, US imports of 3003 and 3105 from China have "declined dramatically," the Aluminum Association said.

"Recently, however, Chinese exporters and producers have been marketing and selling increasing volumes of 4017 aluminum sheet as substitutes for 3003 and 3105 alloy aluminum sheet," the group said. "The heavily overlapping chemistries of alloys 4017 and 3003/3105 indicate that Chinese exporters and producers are simply seeking a 'workaround' of the unfair trade orders."

The 4-series alloys typically are used in different applications than 3003 aluminum sheet as it has a higher silicon content, but the domestic industry alleges that Chinese exporters are marketing 4017 as a substitute for 3003. 3003 aluminum sheet is a high-volume product that is often sold to distributors for building and truck trailer applications.

US imports of 3003 aluminum sheet from China fell from 275,076 mt in the years spanning 2014-2017 to 29,315 mt from 2018 to the present following the launch of the trade case and implementation of duties, lawyers for the Aluminum Association said in the filing to Commerce.

Meanwhile, US imports of 4017 increased from zero in 2014-2017 to 11,247 mt in the years spanning 2018 to the present, according to the data submitted.

Public import statistics do not make a possible distinction between 3-series common alloy aluminum sheet imports and 4017 aluminum sheet as all aluminum sheet imports are classified under the same harmonized tariff schedule subheading.

Commerce did not immediately return a request for comment July 18.

The department self-initiated the original investigation into common aluminum sheet from China November 2017.