ANN ARBOR, MI — KraftMaid Cabinetry will increase prices of its cabinets by up to 12 percent right before Christmas, mainly due to duties being levied on hardwood plywood the company imports from China.
KraftMaid's announcement comes on the heels of last week's decision by the U.S. Department of Commerce that Chinese hardwood plywood was sold in the United States at dumping margins ranging from 55.76 percent to 121.65 percent. The DOC also set countervailing subsidies, ranging from 13.58 percent to 27.16 percent for all but three Chinese hardwood plywood makers.
Kraftmaid, a division of Masco Cabinetry, said the DOC's anti-dumping duties and counterveiling duties totaling 73.04 percent was largely responsible for its decision to raise its cabinet prices by up to 12 percent effective Dec. 23. Inflationary increases on particleboard, cardboard and hard and soft lumbers also are contributing to the planned price increases, which will vary based on cabinet configuration and options.
“The anti-dumping and countervailing duties announced (last) week significantly increase raw material costs for manufacturers, such as KraftMaid Cabinetry,” said Rick Roetken, president of Masco Cabinetry. “As a consequence we regret to announce that it is necessary to increase our prices at this time.”
KraftMaid and Masco are members of the Kitchen Cabinet Manufacturers Association (KCMA). The KCMA joined with a coalition of hardwood plywood importers that has battled against the antidumping action under the umbrella name, American Alliance of Hardwood Plywood (AAHP).
At a hearing before the International Trade Commission last week, the AAHP argued that domestic hardwood plywood and hardwood plywood from China are vastly different products and for the most part do not compete head to head in the U.S. market.
Several AAHP witnesses, including representatives of the KCMA, testified that Chinese hardwood plywoods use thinner veneers and are used mainly for non-decorative parts of cabinets, while domestic hardwood plywood is used for decorative exterior parts.
Carl Spencer, co-owner of Spencer Cabinetry, said, "Cabinetmakers have drawn a clear distinction between the primary wood used for the decorative exterior parts, and secondary wood used for out-of-sight interior structural parts. Face frames and doors are made from primary wood, and unseen case parts are made from secondary wood. No one in our industry would confuse these two materials as the same thing. The key is 'fitness of use.'"
The hardwood plywood antidumping action was initiated September 2012 by the Coalition for Fair Trade of Hardwood Plywood (CFTHP). The CFTHP, comprised of six domestic hardwood plywood producers, has said that sales of their products have been negatively impacted by hardwood plywood made in China being sold in the U.S. below market prices.
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