Aluminium Extrusions Investigations

There was a time when the importation of aluminium extrusions was not seen as risky.  Only general duty rates applied and it didn’t really matter much whether the importation was seen as a mere profile or an unassembled structure.  That was before aluminium extrusions from China were subject to dumping duties of over 100%.  The old days are not coming back and there are currently 5 new investigation on foot that may extend the application, or increase the amount, of the dumping duties.

The new investigations and the actions to be taken are set out below.

Five more years of dumping duties on Chinese aluminium extrusions 

Dumping duties are in place for 5 years and automatically expire unless an application for continuation is made.  Dumping duties on Chinese exports of aluminium extrusions were due to expire in 2020.  However, the Australian industry has lodged an application for continuation of the duties.  The Anti-Dumping Commission (ADC) has in turn commenced a continuation inquiry.

The ADC will consider whether dumping from China is likely to continue and if so, would that dumping continue to cause injury to the Australian industry.  Given Chinese exports comprise over 50% of the aluminium extrusions exported to Australia and the last review found increasing levels of dumping, a continuation of the duties seems inevitable.  However, what is most important is that the ADC will use the inquiry as an opportunity to review the applicable rates.

A rate review could see a change in rates applying to:

  • specific named exporters (the top 5-6 exporters),
  • residual exporters (those that cooperate but do not receive their own rate); and
  • all other exporters (these are the exporters who currently have a rate of 101.9%).

Importers need to inform their suppliers of this inquiry and be urging their involvement.  Interested parties should also take the opportunity to make submissions regarding how dumping margins are calculated, whether the Australian industry is suffering loss and if so, are dumped imports from China the cause of that loss.

A more detailed update on this inquiry can be found here.

Two new investigations into Malaysian exports

There are currently dumping duties that apply to aluminium extrusions exported from Malaysia.  However, there are a number of exporters that have full exemptions from these duties.  We have heard many instances of importers moving supply from China to Malaysia to take advantage of these exemptions.

The Australian industry has lodged applications for two investigations into exports of aluminium extrusions from Malaysia that specifically target the exempt exporters.  One application covers mill finished goods and the other covers goods with surface finishes.  Generally there is only the one investigation that covers both mill finished and coated goods.

The Australian industry has alleged dumping duty rates of 57% for mill finished goods and 37% for surface finished goods.

This Investigation will raise interesting questions of what has caused loss to the Australian industry.  The majority of extrusion imports are from China and are subject to much larger dumping margins.  The ADC needs to properly isolate the impact of these imports. 

It will also be interesting to see whether splitting the applications into 2 works for, or against, the local industry.  The ADC will demand costing to the specific product level.  Some importers may not precisely capture the cost of different types of coating.  If this is the case, the ADC may reject that manufacturer’s costing information resulting in an adverse outcome.

The key point is for exporters and importers to be involved in the investigation.  Exporter questionnaires and initial submissions are due on 1 April 2020.  Submission can cover topics such as whether a particular good is covered by the proposed dumping duties, what has caused the alleged loss and the methodology for calculating dumping duties.

Aluminium micro extrusions from China

Earlier this month an investigation was commenced into aluminium micro extrusions exported from China.  Examples of micro extrusions are flyscreen frame profiles and tubes used for television aerials.  These goods are covered by the general dumping duties applying to Chinese aluminium.  However, this investigation focuses on 2 exempt exporters, being Guangdong Jiansheng Aluminium Co Ltd and Guangdong Zhongya Aluminium Co Ltd.

The applicant has estimated dumping duties of 60% – 90%, while the ADC’s own estimate is closer to 6%.  It is frustrating that the ADC has accepted an application where the applicant’s own view of the level of dumping and the ADC’s estimates are so very different.  The local industry alleges that dumping has caused it loss.  It is reasonable to ask whether that causation argument is based on the alleged 90% dumping or the ADC’s estimate of 6%. 

Importers from the named exporters are encouraged to review the claims of the Australian industry and determine the extent to which they agree or disagree with the claims.  For specialist types of goods it can often be the case that price is not the dominant factor. 

Exporter questionnaires and initial submissions are due by 25 March 2020.

Malaysia and Vietnam – Review of rates

In case the ADC did not have enough on its plate, the Minister has requested that it review the dumping duties applying to exports of aluminium extrusions from Vietnam and Malaysia.  This involves reviewing the normal value, exporter price and dumping margin for non-exempt exporters.

Only exporters involved in the review will receive a specific rate.  Those that elect to not participate will receive an all other exporter rate that will be effectively a penalty.  Those exporters will be stuck with those rates for at least 12 months.

It is important to appreciate that the Minister requested this review due to changed circumstances in the relevant markets.  A Minister is only going to request a review if he or she thinks it will result in higher dumping duties. 

Follow the investigations and rate changes

Even if you will not be participating in an investigation, it is importation to follow the investigations to obtain a sense of what the new rates may be, which exporters will be affected, and when those rates will come into effect.  This will help with supply chain planning, be it importing goods before a rate increase or changing suppliers.

Continued compliance activity

Audits of importations of aluminium extrusions continue to be the topic on which we receive the most calls.  The Australian Border Force will continue to focus on claims that importations should be classified as sets rather than individual items.  Customs brokers are encourage to carefully review any treatment of aluminium extrusions that does not result in the payment of dumping duties. 

There are instances where goods should be classified as set, mountings or furniture parts.  The facts supporting these claims should be supported by relevant documentation.  Further, while you cannot obtain a tariff advice as to whether dumping duty applies, you can obtain a ruling on classification.  For many products, classification will drive the application of dumping duties.

Note that the above article has been sourced from Freight & Trade Alliance.

Should you have any queries regarding aluminium extrusions and dumping, please kindly contact our customs team.