Furniture makers confident US dumping charges doomed

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Last updated at: (Beijing Time) Sunday, December 14, 2003

Furniture makers confident US dumping charges doomed

China's furniture manufacturers responded quietly to the US decision to start dumping investigations which they believe unreasonable, saying they have prepared for it.

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China's furniture manufacturers responded quietly to the US decision to start dumping investigations which they believe unreasonable, saying they have prepared for it.

The US Commerce Department said on Thursday it has accepted a complaint against wooden bedroom furniture imports from China and will launch an investigation that could lead to the imposition of dumping duties.

Chong Quan, the spokesman for the Ministry of Commerce, expressed his deep concern over the case, which involves a total value of US$1 billion, the largest sum the country has ever faced in a dumping case.

He rejected the claim by the US furniture makers that Chinese furniture manufacturing is a non-market economy industry.

"Most of the local furniture makers are privately-owned or foreign-funded. We expect the US authorities will grant them market economy treatment,'' Chong said.

The US furniture makers have asked for duties ranging from 158 per cent to 441 per cent on wooden bedroom furniture from China.

Local furniture makers said the US furniture makers move did not surprise them.

In recent months, the United States has used its trade protection laws to curb imports of textiles, television sets and other products from China.

Cao Yingchao, an official from the China Furniture Association, said domestic furniture exporters and makers have formed a special committee to deal with the case.

They have contributed US$1.6 million in funds to fight the case, Cao said.

Cao insists that the US charge is groundless, given the fact that the exported furniture brings in more profit than furniture sold domestically.

The US furniture makers have accused Chinese furniture makers of selling products at "below-market costs'' which they say has contributed to the closure of dozens of US furniture factories this year.

"We are not dumping. We export because the products can sell at higher prices than at home,'' said Cao.

The average profit on exports can be as much as 30 per cent, according to Cao.

Cao also noted that most of the exporters are private companies that have not been subsidized by the government.

"Chinese exporters can offer lower prices because of the low production costs in China, which is also the reason why so many foreign furniture makers either shift their production bases to China, or have their products made here and sold back home,'' he said.

Many US furniture importers, wholesalers and retailers make their lives on the Chinese furniture trade, which has created a lot of jobs in the United States, Cao said.

Two US furniture retailing chains, American Furniture Warehouse Co Inc, which has nine stores, and Value City Furniture, which has 80 stores, have announced that they have stopped buying bedroom furniture from companies whose executives signed a petition charging China with illegally dumping cheap furniture in the United States.

"We have decided that these are companies we do not want to do business with,'' said Andrew Zuppa, vice-president of marketing for American Furniture, "It is just protectionism. It is an archaic concept, especially in today's global marketplace.''

China exported US$2.8 billion worth of furniture to the United States last year, exports of wooden bedroom furniture making up half the figure. (China Daily)

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