Cambria has announced that the company has filed a petition with the U.S. Department of Commerce and the U.S. International Trade Commission (USITC) claiming imported quartz from China violates antidumping laws. The full petition and supporting documentation are 3,526 pages in length and state that “certain quartz surface products imported from China are being or likely to be sold at less than normal value.”
The most notable allegations in Cambria’s Petition for the Imposition of Antidumping and Countervailing Duties are as follows:
- Quartz surfaces imported from China are likely to be sold at less than normal value in violation of U.S. law. The margin between value and export price is listed at 455.65 percent.
- Chinese quartz imports have negatively impacted domestic quartz manufacturers for several years.
- The material harm caused to U.S. quartz manufacturers is likely to continue if there is no remedial action.
- Chinese quartz producers have at least 20 government subsidy programs available to them, including land provisions, electricity, raw materials, tax breaks, grants and loans.
Marty Davis, president and CEO of Cambria released the following statement to the press:
“Cambria is taking this action to ensure the long-term best interests of our industry, American manufacturing, American workers and American business. Unfair trade practices have gone on for far too long. Fair trade and free trade are inseparable paradigms; you simply cannot have one without the other. We believe strongly in free trade – to protect it, we must demand fair trade.
“Cambria is pursuing existing trade laws to stop the unfair trading from China that is damaging our industry and to restore a level playing field. These fundamental virtues of fair trade and free trade are critical to the success of American capitalism, to our industry, its workers and to the communities and the customers we serve.
“We encourage other American companies to support fair trade, if only to protect the virtues of free trade, and in doing so, our country’s best interests. This is not an effort in protectionism, quite the opposite. Our efforts are to allow for open markets with free and open trade, based squarely on a market economy.”
The petition and its supporting documentation go on to list more than 300 Chinese exporters of quartz surfacing and more than 500 U.S. importers, all of which could be affected should the petition be approved. However, a great number of details have been redacted from the public version because the law allows petitioners the right to leave proprietary information unpublished.
According to the USITC, a preliminary conference will be held on the matter May 8, and action could be taken by September.
What This Means for the Industry
If both the USITC and Department of Commerce approve the petition, “preliminary relief from Chinese imports could be imposed in September 2018 with final duties imposed in June 2019.” Currently, quartz can be imported from non-embargoed countries duty free.
The imports from China alone have gone from only $6 million per year in 2010 to $460 million per year in 2017. If high tariffs are imposed on Chinese quartz, imports could drastically decline because of a slimmer profit margin, which would be on par with that of U.S. quartz producers. But this could also dramatically affect U.S. businesses that rely on Chinese quartz slabs, which includes both suppliers and fabricators.
Possible Quartz-Gate?
At the same time, history has shown us that Chinese exporters and some U.S. importers cannot be counted on to simply pay their duties and carry on business as usual. We could be headed directly from “Honey-Gate” to a new “Quartz-Gate” scandal.
In 2001, U.S. honey manufacturers introduced a very similar Petition for the Imposition of Antidumping and Countervailing Duties against Chinese honey exporters after it was found that they were dumping honey into the U.S. market at up 221 percent less than its value.
After duties were imposed on Chinese honey, exporters began falsifying records and pre-shipping honey to surrounding countries before re-shipping them to the U.S. Honey imports from these surrounding countries soared, and cheap, black-market honey containing fillers and banned antibiotics flourished.
Even though Congress tried to prevent this circumnavigation of import duties with the passing of the Trade Facilitation and Trade Enforcement Act of 2015, scandals continued to rock the industry, which was saved by enlightening the public on cheap honey and advertising the virtues of small-batch, family-farm products.
What Are Your Thoughts?
We always have an ear open for your thoughts on all matters concerning countertops, but this situation could impact the market than any other single event this decade. Is Cambria, with more than 50 percent of the U.S. market in its pocket, the only clear winner here, or will U.S. importers, fabricators and end users also benefit?
