The latest ruling by the World Trade Organization appeals panel against China for deliberately limiting its exports of raw materials for the steel and chemicals industries could have a far reaching impact on the rest of our nation’s imports, particularly for those in the woodworking industry.

Not only could it set a precedent for the U.S. and other countries to challenge China’s export restrictions on other materials, but it could also lead to other rulings that would ultimately level the playing field for the entire manufacturing sector.

The woodworking industry is no stranger to this battle. It has fought for, and won, rulings to stop dumping of low-cost imports into this country. Late last year, the U.S. issued antidumping and countervailing duty orders on multilayered wood flooring from China. Those decisions were based on final determinations by the Department of Commerce and on an “affirmative decision of material injury to a U.S. industry” by the International Trade Commission. Previously, antidumping duties were issued against Chinese manufacturers of wood bedroom furniture for making “sales to the United States at prices below normal value.” That multi-year investigation named dozens of China wood furniture manufacturers that are facing retroactive tariffs from 16 percent to more than 200 percent.

In 2010, China exports of furniture to the United States increased 24.5 percent to $20.0 billion, according to information from the U.S.-China Business Council. Overall, furniture was the fifth largest segment exported from China to the United States, and its sixth largest export product worldwide.

Bringing Business Back to North America

Recent efforts to level the playing field, including the creation of the Trade Enforcement Unit are already having a positive impact on U.S. manufacturing as a whole. On the home front, signs of an improving economy appear to bode well for those involved in both residential and commercial constructions. A general consensus by representatives of the major woodworking market segments is for 2012 sales to match or beat the mark set in 2011.

“In general, retailers appear to have adequate cash on their balance sheets to fund both ongoing renovations and new store openings in 2012. And to date, the consumer appears to be cooperating with increased spending, which bodes well for the future,” said Klein Merriman, executive director of the Association for Retail Environments.

“2012 is projected to bring a rebound in housing starts, a decline in foreclosures and attractive mortgage levels,” said Andy Counts, CEO of the American Home Furnishings Alliance. “Combined with lower home prices, this creates an excellent opportunity for residential housing turnover. This is an important factor for residential furniture sales.”

The increased demand for sustainable products also presents an opportunity for some U.S. manufacturers to grow their businesses. “We continue to see customers looking for increasingly sustainable product alternatives,” said Tom Reardon, executive director of the Business & Institutional Furniture Manufacturers Assn.

Read more state of the industry projections in the February issue of Wood & Wood Products.

Read more of Karen's blogs.

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