Why your Chinese sinks cost more this year.

live_wire_oakMarch 8, 2013

From an article in the Chicago Tribune.

"Superte Kitchenware Co , Guangdong Dongyuan Kitchenware
Industrial Co received preliminary anti-dumping duties of 63.87
percent and 54.25 percent, respectively.

Nineteen Chinese exporters were hit with a 59.06 percent
preliminary duty. All other Chinese producers and e xporters
received a duty of 76.53 percent.

Companies are required to post bonds or cash deposits based
on the preliminary rates. That money would be refunded if a
separate agency, the U.S. International Trade Commission,
decides against the duties in a vote next year."

All of this is designed to make American companies be able to be more price competitive. So that's why Ticor and other direct importers of Chinese sinks have gone out of business or drastically raised their pricing structure.

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jansin62

Can you post the link to the original article. My job involves helping small companies. I'd like to post the link to my colleagues - very very interesting, and great that I can now justify the time I spend focusing on kitchens online as work-related.

TIA!

    Bookmark   March 8, 2013 at 9:49AM
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live_wire_oak

Sure, here you go. There are plenty of other articles in the trade magazines as well.

Here is a link that might be useful: Sets hefty duties on Chinese stainless steel sinks

    Bookmark   March 8, 2013 at 10:04AM
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brickeyee

"All of this is designed to make American companies be able to be more price competitive."

And to remove the advantage that foreign governments give their industries.

Free loans, stat up money, etc.

Labor is not the only expense in making products.

    Bookmark   March 8, 2013 at 11:01AM
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suzanne_sl

I wasn't clear what an "anit-dumping duty" was, so I looked it up. The short definition from Wikipedia:

A standard technical definition of dumping is the act of charging a lower price for the like goods in a foreign market than one charges for the same good in a domestic market for consumption in the home market of the exporter. This is often referred to as selling at less than "normal value" on the same level of trade in the ordinary course of trade. Under the World Trade Organization (WTO) Agreement, dumping is condemned (but is not prohibited) if it causes or threatens to cause material injury to a domestic industry in the importing country.[1]

From the website Investopedia:

Definition of 'Anti-Dumping Duty'
A protectionist tariff that a domestic government imposes on foreign imports that it believes are priced below fair market value. In the United States, anti-dumping duties are imposed by the Department of Commerce and often exceed 100%. They come into play when a foreign company is selling an item significantly below the price at which it is being produced. The logic behind anti-dumping duties is to save domestic jobs, although critics argue that this leads to higher prices for domestic consumers and reduces the competitiveness of domestic companies producing similar goods.

Personally, while I love getting a great price on things, I don't love putting Americans out of work due to foreign state sponsored price fixing, In this case China is accused of paying sink manufacturers an offset so the manufacturers can sell their products for less than it cost them to manufacture the product. The point is to bankrupt products produced elsewhere until the entire market is Chinese, at which point the price for the goods is raised as high as they care to charge.

    Bookmark   March 8, 2013 at 11:08AM
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may_flowers

Just to illustrate how it affects American business--

The article mentions SolarWorld. A few years ago Solarworld, a German company, invested millions in a new manufacturing facility that provided hundreds of good-paying jobs in the Portland, Oregon area. They had only been open about three years with plans for expansion when China started importing their cheap solar panels. Instead of expanding the workforce, SolarWorld had to lay off people. The duties on the imports probably saved them from closing the facility.

    Bookmark   March 8, 2013 at 11:50AM
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