Global Fastener News

Europe Dumping Investigation Prompts Concern in China

Jason Sandefur

The European Commission investigation into alleged dumping of carbon steel fasteners from China has prompted serious concern among Chinese fastener manufacturers, who warn that tariffs could prompt a reversal of export subsidy cutbacks in China.
Since the EU does not recognize China as a market economy, the Commission is proposing to compare with prices in the Indian market instead of the normal comparison with domestic prices in the country of origin, Fastener & Fixing Europe editor Phil Matten reports.
If Chinese fastener companies are unable to demonstrate market economy status to EC investigators, tariffs are likely to be very high.
The issue worries Chinese fastener manufacturers, who claim that there is no dumping when export prices are compared with the fiercely competitive Chinese domestic market.
But EC investigators are likely to focus on whether the cost of wire rod used in production is subsidized.
“Despite substantial price increases during 2007 Chinese wire rod prices remain as much as 35% to 40% lower than their European equivalent,” Matten writes. This makes it “very difficult to see how Chinese authorities can argue that its steelmakers are operating on a market economy model.”
The antidumping complaint filed by the European Fastener Distributors Association argues that European manufacturers have some 300,000 tons annual capacity available to replace imported Chinese fasteners. European distributors, however, argue that much of the capacity could not be adapted to produce the standard specifications cited in the dumping complaint. �2007 FastenerNews.com and Fastener & Fixing Europe