In its petition to the US Department of Commerce filed on October 22, Mexichem alleges that subsidised R134a from China is being sold in the United States at less than fair value.
Imports of R134a from China are said to have increased from 4,369 tons in 2010 to 12,868 tons in 2012 before declining slightly in first half of this year. In addition to these significant increases, the imports entered at exceptionally low prices. Drawing on customs data, Mexichem maintains that import prices fell from $5,280 per ton in 2010 to $4,130 per ton in 2012 and then plummeted to $3,400 per ton in the first half of this year.
The US R134a industry is said to have suffered as a result, losing market share and being forced to cut prices at the expense of profit in an effort to compete.
“The massive Chinese overcapacity, Chinese government subsidies and Chinese underselling, combined with the US industry’s need to operate at high utilization levels makes the domestic industry quite vulnerable to a real and imminent threat of injury,” says Mexichem in its petition.
The US government must decide whether to introduce anti-dumping and countervailing duties on the Chinese imports. Anti-dumping duties are imposed to offset unfairly priced imports that materially injure or threaten to injure US industry. Countervailing duties are imposed to offset allegedly unfairly priced imports that are subsidised by national, state, or provincial governments that materially injure or threaten to injure the US industry.
On October 24, 2013, the United States International Trade Commission sent a letter to all U.S. R134a stakeholders requesting that they complete a questionnaire on R134a.
If approved, duty liability could begin as soon as January 16, 2014.