WASHINGTON, DC — Domestic cabinet suppliers are rallying Congressional support in their bid for trade officials to impose duties on Chinese cabinet and vanity imports while awaiting a key Commerce Dept. decision into charges that unfair Chinese trade practices in cabinet manufacturing and exporting are undermining the businesses of U.S. firms.
Representatives of the American Kitchen Cabinet Alliance (AKCA) met last month with U.S. Sen. Mike Rounds (R-SD) to solicit support for an unfair-trade petition filed by the AKCA, a coalition of cabinet manufacturers seeking the imposition of antidumping and countervailing duties on imports of Chinese-made wooden cabinets, vanities and components.
Rounds, a member of the Senate Banking Committee, pledged his backing of the AKCA effort after meeting 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 serving as counsel for the AKCA.
“The kitchen cabinet industry plays a vital role in our economy, supporting more than 250,000 jobs across the U.S,” said Rounds, offering to support investigations “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.”
Foreign companies that price their products in the U.S. below the cost of production, or below prices in their home markets, are subject to antidumping duties. Companies that receive unfair subsidies from their governments are subject to countervailing duties aimed at countering those subsidies.
The AKCA, in its March petition, charged that as a result of Chinese trade practices – including loans, grants, tax incentives and other government programs – 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 domestic cabinet market.
The imports, if left unchecked, pose an existential threat to the U.S. cabinet trade, according to the ACKA, which said it continues to call on the U.S. International Trade Commission (ITC), Commerce Dept., Trump Administration and Congress “to stand up for American workers and the American wooden cabinet and vanity industry.”
As required under U.S. trade law, antidumping and countervailing duty investigations are underway by both the ITC and the Commerce Dept., which address 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 for Commerce to issue antidumping and countervailing duty orders.
The ITC has already determined 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 cleared the way for the Commerce Dept. to move ahead with its countervailing duty and antidumping investigations. If Commerce determines that dumping and/or unfair subsidization is occurring, then it will instruct U.S. Customs and Border Protection to start collecting cash deposits from all U.S. companies importing wooden cabinets and vanities from China. Commerce Dept. decisions are scheduled for Aug. 13 on the countervailing duty investigation, and Oct. 28 for the antidumping probe.
“We are pleased to have Sen. Rounds lend his support to our fight against China’s unfair-trade practices,” said 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,” added 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,” said 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 unfair-trade case has led to a sharp division within the cabinet industry, however, with the AKCA’s unfair-trade petition under fire 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 said, could effectively “wipe out” the RTA market segment from the U.S. marketplace “by taking advantage of anti-China trade sentiment.”
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