Washington - Chinese and domestic hardwood plywood are vastly different, serve different market tiers that do not crossover and are therefore non-competitive with one another, argued members of the Alliance for Hardwood Plywood (AAHP) and the Kitchen Cabinet Manufacturers Association before the International Trade Commission (ITC). The ITC hearing is the latest stage of a federal investigation into imported Chinese hardwood plywood and its potential impact on domestic producers of hardwood plywood.
Samples of Chinese hardwood plywood were presented in comparison to domestic showing a clear difference in thin versus thick face veneer, while several manufacturers shared first hand the application differences.
"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," said Carl Spencer, Co-Owner of Spencer Cabinetry. " The key is 'fitness of use.'"
Additional cabinetmakers echoed the fundamental differences between Chinese and domestic plywood. The result of these differences is a two-tier market that has little crossover.
No cabinetmakers were represented on the side of the petitioners, which AAHP noted is telling of their intent. The protectionist attacks on imported Chinese hardwood plywood were initiated by just six domestic American companies who already control 80% of the domestic hardwood plywood market and seemingly seek to corner a market and crowd out overseas competition.
"Despite the claims of the petitioners, there has been no flood of imported hardwood plywood into the U.S. market," said AAHP Co-Chairman Greg Simon. "The U.S. plywood producers' market share has held firm in an expanding market. In fact, evidence the ITC confirms that China is actually losing market share to its offshore rivals."
AAHP argued that ruling in favor of the petitioners at the severe and unprecedented duty rates announced this week by Department of Commerce will shock the industry, American labor will shift overseas, where products like kitchen cabinets can be manufactured and shipped to the U.S. free of all import duties. Competition won't just come from China, but also from robust trade competitors like Canada and Mexico, which are primed to capture any U.S. market share.
The ITC commissioners listened intently, asked thoughtful questions and were engaged in the testimony as it related to the data collected over the past several months. The AAHP praised the ITC and urged them to practice due diligence in the proceedings, review the evidence closely and recognize that the arguments that they and the cabinetmakers representing hundreds of small manufacturing companies presented make the stronger case.
"The ITC is an independent, non-biased entity in this case and has an opportunity to balance a preponderance of our evidence against the motivations of the petitioners," Simon said. "We are hopeful that due process will win the day, the investigation will be terminated and this protectionist campaign will finally be brought to a close."
See Wall Street Journal op-ed by Greg Simon and Richard Titus, EVP of Kitchen Cabinet Manufacturers Association here: http://online.wsj.com/article/SB1000142412788732359500457906912193116824...
The American Alliance for Hardwood Plywood (http://www.aa-hp.org) is an organization of American importers, distributors and manufacturers of hardwood plywood, along with other U.S. companies that depend on the availability of global resources.
Source: American Alliance for Hardwood Plywood
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