US Polyester Yarn Makers Allege Dumping From China, India

Two major US synthetic yarn producers—Unifi Manufacturing, Inc (Unifi) and Nan Ya Plastics Corporation, America (Nan Ya)—have filed petitions alleging that dumped and subsidised imports of polyester textured yarn from China and India are causing material injury to the domestic industry. The petitions have been filed with the US department of commerce.
“The purpose of these petitions is to establish conditions of fair competition in the US market. The petitioning domestic producers are asking the US government to investigate the dumping, subsidies and injury and to impose anti-dumping and countervailing duties on the imports of polyester textured yarn from the subject countries,” Kelley Drye & Warren LLP, who represent the petitioning companies, said in a press release.

Unifi manufactures polyester textured yarn at its production facilities in Yadkinville, North Carolina, and Madison, North Carolina, where the company employs approximately 1,100 and 470 people, respectively. Nan Ya manufactures the said yarn at its production facility in Lake City, South Carolina, where it employs approximately 900 people.

The petitions, also concurrently filed with the United States International Trade Commission (USITC), allege that producers in China and India are dumping polyester textured yarn in the US market at sizeable margins (China – up to 68 per cent; and India – between 40 per cent and 130 per cent).

The petitions also allege that the Chinese polyester textured yarn industry benefits from at least 20 different Chinese government subsidies, and that the Indian polyester textured yarn industry benefits from at least 38 different Indian government subsidies.

The allegations identify a number of significant national and regional programmes, including preferential export financing, export loans, and export credits; preferential income tax treatment; tax exemptions, rebates, and credits on inputs and capital goods used in the production of polyester textured yarn; the provision of goods and services by the governments for less than adequate remuneration; and grants for polyester textured yarn producers to assist in the development of export market and to protect against commercial risk.

US polyester textured yarn imports from China and India have increased at an astounding rate over the last five years, growing from approximately 38.4 million pounds in 2013 to 68.9 million pounds in 2017 (an increase of approximately 79 per cent), the release said.

“The substantial increase in unfairly-traded polyester textured yarn from China and India has harmed US manufacturers and their workers,” according to Paul Rosenthal of Kelley Drye & Warren LLP, counsel for the petitioning companies. “Trade relief is essential to ensuring that the domestic polyester textured yarn industry can recover from its injured and vulnerable state, thrive, and fairly compete.”

Now, the US department of commerce will determine whether to initiate the anti-dumping and countervailing duty investigations, and the USITC will reach a preliminary determination of material injury or threat of material injury within 45 days from the date of filing. The entire investigative process, however, will take approximately one year, with final determinations of dumping, subsidisation, and injury likely occurring by the end of 2019.

Polyester textured yarn, a synthetic multifilament yarn, is manufactured from polyester (polyethylene terephthalate). It is produced through a texturing process, which imparts special properties to the filaments of the yarn, including stretch, bulk, strength, moisture absorption, insulation, and the appearance of a natural fibre.

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