US polyester producers complain of Chinese, Indian dumping

Mark Lane | 18th October 2018

WASHINGTON – Two leading US polyester producers, Unifi and Nan Ya Plastics, have filed petitions alleging that dumped and subsidised imports of polyester from China and India are damaging the domestic market. The petitions allege that producers in China and India are dumping polyester textured yarn in the US market at sizeable margins – by up to 68 per cent in the case of China and between 40 and 130 per cent in the case of India. The US Commerce Department will determine within the next few weeks whether to take the petitions forward.

At the start of 2018, the Department of Commerce took the decision to apply tariffs to fine denier polyester staple fibre imports from China, India, Korea and Taiwan after complaints of dumping. The decision was in-keeping with the increasingly protectionist rhetoric of the Trump administration and quite possibly sets an important precedent in this area which the current applicants will be well aware of.

The products affected by this case are made by Unifi at its production facilities in Yadkinville, North Carolina, and Madison, North Carolina, where Unifi employs approximately 1,100 and 470 people, respectively, and by Nan Ya at its production facility in Lake City, South Carolina, where Nan Ya employs approximately 900 people.

The petitions also allege that the Chinese polyester textured yarn industry benefits from at least 20 different Chinese government subsidies, and that the Indian polyester textured yarn industry benefits from at least 38 different Indian government subsidies.

The allegations identify a number of significant national and regional programmes, including preferential export financing, export loans, and export credits; preferential income tax treatment; tax exemptions, rebates, and credits on inputs and capital goods used in the production of polyester textured yarn; the provision of goods and services by the governments for less than adequate remuneration; and grants for polyester textured yarn producers to assist in the development of export market and to protect against commercial risk.

“The substantial increase in unfairly-traded polyester textured yarn from China and India has harmed US manufacturers and their workers,” according to Paul Rosenthal of Kelley Drye & Warren LLP, counsel for the petitioning companies.  “Trade relief is essential to ensuring that the domestic polyester textured yarn industry can recover from its injured and vulnerable state, thrive, and fairly compete.”

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