US Customs and Border Protection is investigating three hardwood plywood importers to determine whether they avoided paying anti-dumping and countervailing duties by misdeclaring the origin of Chinese materials and then transshipping them through Cambodia.
The agency on Oct 1. notified InterGlobal Forest, American Pacific Plywood, and US Global Forest that it was investigating the companies for possibly evading anti-dumping margins and countervailing duties, which are 183.36 percent and up to 23 percent, respectively. The investigation comes after Customs in March announced it had identified more than $600,000 in hardwood plywood misclassified as ready-to-assemble kitchen cabinets.
Since the anti-dumping and countervailing duties were announced in November 2017, the imports of hardwood plywood from China have fallen from 1.1 million cubic meters in 2017 to about 181,300 cubic meters in 2018, according to the Coalition for Fair Trade of Hardwood Plywood. The coalition made the allegations against the three companies in June 26.
Chinese shipments of hardwood plywood to Cambodia more than quadrupled to approximately 152,000 cubic meters between 2017 and 2018, the coalition stated. In the same period, hardwood plywood shipments from Cambodia to the United States more than doubled to about 53,800 cubic meters. The coalition noted that Cambodia in 2016 only used 30,000 cubic meters of plywood and produced 27,000 cubic meters.
Some Chinese goods imported into the US are being transshipped through Vietnam and misdeclared as having originated from there, according to the Wall Street Journal and Bloomberg. But analysts quoted in those reports do not believe the tariff workarounds will be on any significant scale, with customs authorities on both sides of the Pacific cracking down on the practice.
US imports from China declined 5 percent in the first six months of the year against the same period in 2018, while imports from Vietnam were up 30.5 percent, according to data from PIERS, a JOC.com sister company within IHS Markit.