U.S. Nail Producers File Anti-Dumping Suit Against China, UAE

Five U.S. producers of steel nails have filed antidumping duty petitions alleging that dumped imports of nails from China and the United Arab Emirates (UAE) are causing material injury to the domestic industry. The petitioners allege antidumping margins of 59 percent to 136 percent for China and 98 percent to 114 percent for the UAE.
The petitioners are Mid Continent Nail Corporation, Poplar Bluff, MO; Davis Wire Corporation, Irwindale, CA; Gerdau Ameristeel Corporation (Atlas Steel & Wire Division), Tampa, FL; Maze Nales (Division of W.H. Maze Company), Peru, IL; and Treasure Coast Fasteners, Inc., Fort Pierce, FL.

Domestic nail producers contend that unfairly priced imports of steel nails have injured the U.S. industry by undercutting their prices and taking sales based on unfair trading practices.

The petition requests that the U.S. government impose antidumping duties on nail imports from China and the UAE. Antidumping duties are intended to offset the amount by which a product is sold at less than fair value in the U.S. (i.e., the amount by which the product is sold below production costs or at a price that is below the price charged in a comparable market).

Dumped imports of steel nails from China and the UAE constitute a large and increasing share of the U.S. market. Imports of nails from China and the UAE surged from 411,980 short tons in 2004 to 698,460 short tons in 2006, or 70 percent. Chinese and UAE shipments accounted for 75 percent of all nail imports in 2006.

The petition covers certain steel nails that are produced from various grades of steel and that have a variety of finishes, heads, shanks, points and sizes. Certain steel nails may be sold in bulk or collated into strips or coils using materials such as plastic, paper, or wire. Steel roofing nails and nails for use in powder-actuated hand tools are not covered by the petition.

Imports from China and the UAE have flooded the U.S. market during the past three years, taking significant market share from the domestic producers," said Paul C. Rosenthal, the lead attorney for the petitioners. "The unfairly priced imports from China and the UAE have caused severe financial distress to the domestic industry, leading producers to reduce production, close divisions, and even completely shut down their nail operations.

"Domestic producers need relief from dumped imports to prevent further plant closures and to allow domestic producers to return to healthy profit levels."

The filing of the petition starts the process by which the U.S. International Trade Commission will determine if the U.S. nails industry has been materially injured, or threatened with material injury, and the U.S. Department of Commerce will determine whether dumping exists.

The USITC must reach its preliminary determination of material injury or threat of material injury within 45 days; the Commerce Department is required to announce preliminary antidumping duties in 160 days.

Once the Commerce Department makes its preliminary determination, U.S. Customs and Border Protection will require importers to pay a cash deposit or post a bond equal to the estimated dumping margin. The entire investigative process takes about one year. Final determinations will happen in mid-2008.