The U.S. Department of Commerce (DOC) has initiated new antidumping duty (AD) and countervailing duty (CVD) investigations to determine whether utility-scale wind towers from Canada, Indonesia, Korea and Vietnam are being dumped in the U.S., as well as to determine if producers in Canada, Indonesia and Vietnam are receiving unfair subsidies.
Although there is already an existing AD order on utility-scale wind towers from Vietnam, the petition was filed with respect to one company that was excluded from the current order, the DOC says in a press release.
These investigations were initiated based on petitions filed by the Wind Tower Trade Coalition (WTTC), the members of which are Arcosa Wind Towers Inc. of Dallas and Broadwind Towers Inc. of Manitowoc, Wis.
The parts covered by the scope of the investigations consist of certain wind towers, whether or not tapered, and sections thereof. Certain wind towers support the nacelle and rotor blades in a wind turbine in excess of 100 kW and with a minimum height of 50 meters. Excluded from the scope are nacelles and rotor blades, regardless of whether they are attached to the wind tower. Also excluded are any internal or external components that are not attached to the wind towers or sections thereof, unless those components are shipped with the tower sections.
The alleged dumping margins are as follows:
- Canada – 53.63% to 61.59%
- Indonesia – 26.00% to 47.19%
- Korea – 280.69% to 331.26%
- Vietnam – 39.97% to 65.96%
There are 30 subsidy programs alleged for Canada, eight subsidy programs alleged for Indonesia and 24 subsidy programs alleged for Vietnam.
If the DOC makes affirmative findings in these investigations, and if the U.S. International Trade Commission (ITC) determines that dumped and/or unfairly subsidized U.S. imports of utility-scale wind towers from Canada, Indonesia, Korea and/or Vietnam are causing injury to the U.S. industry, the DOC will impose duties on those imports in the amount of dumping and/or unfair subsidization found to exist.
In 2018, according to the department, imports of utility-scale wind towers from Canada, Indonesia, Korea and Vietnam were valued at an estimated $60.2 million, $37.4 million, $50 million and $21.4 million, respectively.
During the DOC’s investigations, the ITC will conduct its own investigations into whether the U.S. industry and its workforce are being harmed by such imports. The ITC is expected to make its preliminary determinations on or before Aug. 23. If the ITC preliminarily determines that there is injury or threat of injury, then the DOC’s investigations will continue, with the preliminary CVD determinations scheduled for Oct. 2, and preliminary AD determinations scheduled for Dec. 16, unless these deadlines are extended.
If the DOC preliminarily determines that dumping and/or unfair subsidization is occurring, then it will instruct U.S. Customs and Border Protection to start collecting cash deposits from all U.S. companies importing utility-scale wind towers from Canada, Indonesia, Korea and Vietnam.
Final determinations by the DOC in these cases are scheduled for Dec. 16 for the CVD investigations and March 2, 2020, for the AD investigations, but these dates may be extended. If the DOC finds that products are not being dumped and/or unfairly subsidized, or the ITC finds in its final determinations there is no harm to the U.S. industry, then the investigations will be terminated and no duties will be applied.
Under the Trump administration, the DOC has initiated 179 new antidumping and countervailing duty investigations.
Foreign companies that price their products in the U.S. market below the cost of production or below prices in their home markets are subject to antidumping duties, the department explains. Companies that receive unfair subsidies from their governments, such as grants, loans, equity infusions, tax breaks or production inputs, are subject to countervailing duties aimed at directly countering those subsidies.
A similar case was initiated by the WTTC under the Obama administration in December 2011. The DOC, which issued its final ruling on the case in December 2012, then imposed AD and CVD orders against Chinese producers of utility-scale wind towers with AD margins of between 44.99% and 70.63% and CVD margins of between 21.86% and 34.81%. The DOC also imposed an AD order against Vietnamese producers of utility-scale wind towers at margins of between 51.50% and 58.49%. In January 2013, the ITC determined that the U.S. wind energy industry was, indeed, materially injured by dumped and subsidized imports of utility-scale wind turbine towers from China and Vietnam.
Regarding the newest investigation, Wood Mackenzie, a Verisk Business, says in a research note that the actions are “problematic, to say the least, and will negatively impact the cost position of new unit installs in 2020 and beyond.”
“Price pressure exists throughout the value chain already, but turbine OEMs are expected to bear the financial burden of the latest salvo in the ongoing trade war,” it adds.