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Decision Due From U.S. Trade Officials on Chinese Cabinet Imports Petition

WASHINGTON, DC — U.S. trade officials are expected to proceed to the next stage of deliberations into charges that Chinese trade practices in cabinet manufacturing and exporting are undermining the businesses of U.S. cabinet suppliers.

A decision by the U.S. Commerce Dept. was scheduled by Aug. 5 – prior to press time for this month’s issue of Kitchen & Bath Design News – on the question of whether to move ahead with the lengthy decision-making process regarding an unfair-trade petition filed in March by the American Kitchen Cabinet Alliance (AKCA), a coalition of cabinet manufacturers seeking the imposition of antidumping and countervailing duties on imports of Chinese-made wooden cabinets and vanities. A Commerce Dept. decision on the matter had previously been scheduled for May.

The U.S. International Trade Commission (ITC), which is also mulling the contentious trade case, has already determined that there is “a reasonable indication” that the U.S. cabinet industry “is materially injured” by imports of Chinese cabinets and vanities allegedly sold in the U.S. at less-than-fair market value. The ITC decision, which the AKCA termed “an important first win,” cleared the way for the Commerce Dept. to move ahead with its antidumping and countervailing duty investigations.

Representatives of the AKCA met in Washington last month with U.S. Senator Mike Rounds (R-SD), a member of the Senate Banking Committee, to discuss U.S.-China trade relations.

Rounds met with Mark Trexler, president and CEO of Master WoodCraft
Cabinetry; Stephen Wellborn, director of product and research for Wellborn Cabinet, and Timothy Brightbill, a partner at Wiley Rein LLP, the Washington, DC-based law firm that is serving as counsel for the organization, which said it continues to call on the ITC, the Commerce Department, the Trump Administration and Congress “to stand up for American workers and the American wooden cabinet and vanity industry.”

“The kitchen cabinet industry plays a vital role in our economy, supporting thousands of jobs in South Dakota and more than 250,000 jobs across the U.S,” said Rounds, pledging to support investigations by the Commerce and USITC “to address unfair-trading practices that are hurting U.S. kitchen cabinet workers.

“American businesses can compete with anyone in the world if they’re given an opportunity,” Rounds said. “We must make certain our kitchen cabinet industry is on a level playing field with its global competitors.”

“We are pleased to have Sen. Rounds lend his support to our fight against China’s unfair-trade practices, which threaten more than 250,000 American jobs,” said Stephen Wellborn. “The vast majority of these American kitchen cabinet jobs are in America’s heartland. If these hundreds of thousands of jobs go away, the impact will be devastating for our workers and their families.”

“With a level playing field, American kitchen cabinet manufacturers can
compete with any company or country in the world,” observed Trexler. “What we cannot compete with is China’s cheating. Our workers pride themselves in the tradition of American craftsmanship, and that tradition is under direct attack from China.”

“The U.S. cabinet and vanity industry and its workers have suffered for years due to dumped and subsidized imports from China,” added Brightbill. “We urge the Commerce Dept. and the ITC to continue to thoroughly investigate these unfair trade practices and to apply the trade remedy laws to dumped and subsidized Chinese products.”

The AKCA, in a March petition, charged that, as a result of unfair-trade practices, imports of illegally subsidized and dumped Chinese-made kitchen cabinets and vanities, sold at lower than market value, have risen sharply in recent years, and currently comprise more than one-third of the $9.5-billion U.S. cabinet market. The imports, if left unchecked, pose an existential threat to the U.S. cabinet trade, according to the ACKA.

The unfair-trade case, mirroring similar cases in other kitchen/bath product sectors – including quartz surfacing and ceramic and porcelain tile – has led to sharp divisions between industry alliances who have lined up on opposite sides of the issue (see related stories).

The AKCA’s charges, for example, are being contested by an alliance of distributors, dealers, contractors, installers and importers of ready-to-assemble cabinets. That alliance, known as the American Coalition of Cabinet Distributors (ACCD), was launched in May to fight the antidumping and countervailing duty petitions, since imposition of the duties, the ACCD says, could effectively “wipe out” the RTA market segment from the U.S. marketplace “by taking advantage of anti-China trade sentiment.”

As required under U.S. trade law, the antidumping and countervailing duty investigations are underway by the ITC and the Commerce Dept., both of which conduct preliminary and final phase investigations, addressing different aspects of the case. The ITC determines whether there is material injury or threat of injury to the U.S. industry by the imports. Commerce determines whether the alleged dumping and subsidization are occurring, and if so, at what levels. Both agencies must reach affirmative final determinations on the separate issues for Commerce to issue antidumping and countervailing duty orders. Decisions come at different points in the multi-stage investigatory process, which could take as long as a year to complete.

The unfair-trade case, as with those involving other kitchen and bath products, are independent of policy decisions regarding the broader issue of tariffs tied to the ongoing U.S.-China trade war (see related story).

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