Global Fastener News

December 7, 2009 FIN – The unanimous U.S. International Trade Commission decision to terminate the antidumping investigation into standard fastener imports from China and Taiwan was prompted by at least two factors, a new report reveals.
First, standard fastener imports did not gain more market share from 2006 to 2008. Secondly, Nucor Fastener “failed to provide adequate details” to support allegations that it was losing sales and revenues to cheaper imports, according to the ITC.

Imports ‘Stable’ Despite Widespread Underselling
The ITC’s 137-page public report, “Certain Standard Steel Fasteners from China and Taiwan,” shows that the Commission rejected Nucor Fastener’s petitions for antidumping and countervailing duties because standard fastener imports, by volume, have increased less than 2% in the past three years.
U.S. consumption of standard fasteners, by quantity, declined about 3% over the last three years – from 661.3 million pounds in 2006 to 642.4 million pounds in 2007 and 641.6 million pounds in 2008 and was 343.5 million pounds during the first six months of 2008 and 225 million pounds in the first half of 2009, the ITC found.
In recent years standard fastener import market share, by quantity increased slightly, from 51.3% in 2006 to 53% in 2007, before dropping to 51.8% in 2008.
“At the same time, the domestic industry’s U.S. shipments of (standard fasteners) decreased from 155.3 million pounds in 2006 to 150.1 million pounds in 2007 and then increased to 155.6 million pounds in 2008.”
The ITC found “pervasive underselling” by imports from China and Taiwan, but concluded imports had no “significant adverse price effects.”
“The underselling did not lead to significant price depression or suppression or to a significant gain in market share by the subject imports at the expense of the domestic industry.”
The domestic industry’s cost of goods sold as a share of net sales was essentially stable.
“Steadily improving unit sales values between 2006 and 2008 offset (in 2007) and then augmented (in 2008) fluctuations in sales quantities, resulting in a 22% increase in the absolute value of sales.”
Operating income followed suit, with the domestic industry increasing its unit sales values by several cents per pound more than the $0.14 per-pound increase in unit operating costs largely attributable to raw materials.
“The improvement in financial results between 2006 and 2008 was widespread, as eight of the nine domestic producers reported increases in the absolute value of operating profits and the unit value of sales, and seven reported increases in the absolute value of sales and in their operating margin.”
The ITC noted a lack of correlation between the steady volume of low-priced imports and either domestic prices or the domestic industry’s condition.
“We therefore do not find that there is a reasonable indication that cumulated subject imports from China and Taiwan are having an adverse impact on the domestic industry.”

U.S. Producers Couldn’t Prove Lost Sales
Although Nucor Fastener alleged losing sales and revenue to standard fastener imports from China and Taiwan, the company “failed to provide adequate details to support these allegations,” the ITC concluded.
“Nucor at times claimed that it does not keep detailed information on lost sales/lost revenues or does not receive detailed reasons for its lost sales/lost revenues from the distributors to whom it sells,” the ITC reported.
“At other times, however, Nucor reported that it could supply the Commission with more detailed information concerning its losses, but then submitted only incomplete or untimely data.”
Other domestic producers reportedly provided limited information about lost sales and lost revenue allegations, which ITC investigators could not verify.
“Overall, the record … reflects favorable or even improving performance indicators for the domestic industry,” the ITC wrote. “The domestic industry maintained substantial and increasing operating profits from 2006 to 2008, despite slightly declining demand conditions, significant subject import market share, and significant underselling by subject imports from China and Taiwan.”
The domestic industry’s standard fastener production went from 162.3 million pounds in 2006 to 170.3 million pounds in 2008.
“Total U.S. shipments of (standard fasteners) followed similar trends, declining somewhat at the end of the period examined consistent with declines in apparent U.S. consumption.”
By quantity, the domestic industry’s share of the U.S. market rose slightly from 2006 to 2008, from 23.5% to 24.2%.
The domestic industry’s net sales, by quantity, went from 163.2 million pounds in 2006 to 166.0 million pounds in 2008. By value, the domestic industry’s sales went from $158.2 million in 2006 to $192.5 million in 2008.
“The record as a whole contains clear and convincing evidence that there is no reasonable indication of material injury by reason of cumulated subject imports of (standard fasteners) from China and Taiwan and that no likelihood exists that contrary evidence would arise in any final-phase investigations.”
Nucor Fastener has until mid-December to file a notice of appeal, and an additional 30 days to outline its complaint. The appeal would be heard by the U.S. Court of International Trade. ©2009/2014 Fastener Industry News.
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