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What does the Threat from China Really Look Like?

Many are questioning whether the recent drive by the Chinese Extrusion Industry to export products off-shore, and particularly into the North American market, is a long term play or simply a temporary solution to satisfy a short term supply-demand imbalance while their domestic demand improves.
It’s a great question and once you look at the data there is an obvious answer and it is about supply and demand. Clearly the domestic industry has been expanding its capacity well beyond the requirement to supply domestic needs within China.
First of all let’s consider the domestic demand in China for aluminum extrusions. In looking at the trend over the past decade, it has been anything but anemic. With domestic GDP running well into the double digits over this period, the demand for aluminum extrusions in the Transportation and Building and Construction industries alone have been able to support a significant increase in domestic capacity. So an increase in domestic capacity was necessary. Ho…

Scope Requests: A Slippery Slope Worth Defending

I’m delighted to contribute to the Aluminum Extruders Council’s blog, So far the topics have been devoted to the Chinese aluminum extrusion imports trade case with the United States. Like me, many of you have volunteered your time, energy, and resources to this case.  For those on the Fair Trade Committee, we have learned a valuable lesson: this case is not going away!  The number of hours, the attention to detail--and yes, the money--has all been much greater than we ever imagined.  Those that continue to support illegal and unfair trade practices have been persistent in their mission to find cracks in the original orders.  As a result, scores of appeals, scope requests, court decisions, and even legislative actions have pummeled our industry in an effort to find those cracks.
After nearly 18 months of defending the orders, it is clear that we have the talent, drive, and resources required to preserve the orders.  The passion and tenacity exhibited by aluminum extruders, and their sup…

Are Chinese Imports of Extruded Products Affecting You?

Over the past several years, each of us in the industry has had to assess and decide the role we felt compelled to play in this long-term battle for fair trade. In doing so, a question that constantly comes up: “Is my business being affected by this onslaught of imported Chinese extrusions or not?”
While it is a simple question, finding the answer isn’t always obvious. There are two avenues to find the answer to this question. One is being able to put your finger on specific business--that either left when the imports were escalating or came back once the duties were applied. The other would be to assess the overall impact to your business as the industry absorbed the huge level of imports in 2009 and the early part of 2010.
The first is the easy one. If you can put your finger on specific bits of business that either disappeared when Chinese imports were escalating dramatically in 2009 or, conversely, if you can identify specific bits of either returning business or new business that …

Are We Winning the Fair Trade Battle?

At this point, the answer is an easy one – ABSOLUTELY.  There are several key metrics to consider. The first is where we are winning and where we are losing on the various decisions from the Department of Commerce (DOC) and the US International Trade Commission (ITC) that support our case that Chinese aluminum extrusions were being illegally imported. The second question is the one that really counts: whether the orders of the DOC on duties related to aluminum extrusion imports from China are effective.
Let’s first look at the decisions of the DOC and ITC. The big win was the obvious one that culminated in the ITC decision in early 2011 that our industry was being injured by imported Chinese extrusions and then in April 2011 by the DOC that the Chinese producers were causing this injury through government subsidies and by “dumping” extrusions illegally into the U.S. Their decision to help “level the playing field” resulted in duties of up to 400 percent.
Subsequent to this obvious win,…

Taking our Case to Washington

Fair Trade - What’s at stake?

In the last two blogs, we have talked about what it takes to be successful in a fair trade case such as the one the extrusion industry brought before the U.S. government. The process is long and arduous. It takes a focused commitment from the entire industry. And it takes money. On top of that, the drive must be maintained for the long run. This is not a sprint; it is a marathon.
So, is it worth it? What’s at stake?
As we mentioned in last week’s blog, the Chinese will NOT give up. They have extremely strong strategic, economic and political reasons to vigorously continue to fight this battle. The Chinese extrusion industry has built a capacity that far exceeds their current and future domestic need and, in fact, could supply a good part of the global requirement. Their desperate need to create employment significantly outweighs any supply/demand rational for this build-up in capacity.
Once you buy the argument that the Chinese extrusion industry will do everything in their power (legal…

Fair Trade Initiative - It's a Marathon, Not a Sprint

In the last blog we talked about the process that we must go through in order to maintain our hard fought, and dearly needed orders from the Department of Commerce (DOC) that have applied level-playing-field duties on Chinese imports.
What we know now is that this is clearly a long term initiative. Where we perhaps had entered into the process thinking that this was a sprint – a two- to three-year all-out effort which would slow down significantly once we cross the finish line – we must now think of as a marathon. There is no real finish line. Where winning a race is typically measured on crossing some sort of finishing line, our success in this process will be measured by the continued growth and health of our industry over time. Metrics of success will be things like improving P&Ls (beyond historical levels), strong cash flow, the domestic industry’s penetration of aluminum extrusions against other materials, domestic industry’s growth that is well beyond simple GDP growth, incre…

Fighting the Fair Trade Battle: A learning process for long-term success

When we embarked on this process to defend our industry against an exponentially escalating level of Chinese imports in 2009, there were many things we did not know about the journey we were about to take.
What we DID KNOW was that the industry’s future was at stake. We had done enough research to understand what China was doing and why (to be covered in a future blog) and that the 20% market share that they had taken was not going to be their stopping point. Something had to be done or we strongly believed that we would eventually lose the bulk of our market. What we also knew was that extruders are generally passionate about their businesses. It has been a lifetime’s livelihood for many of us, often starting with our parents and now one in which many of our children are counting on for their livelihood. No – while the Chinese are obviously formidable, what they were doing was and is predatory and illegal and we weren’t about to let them do this to us.
What we didn’t truly understand i…

Welcome to the AEC Blog!

Testing - 1,2,3....Is this thing on?  The Aluminum Extruders Council is proud to announce the launching of our first blog!
This Shaping Solutions Together blog will feature timely, relevant information written by guest authors who are respected leaders in the industry, as well as staff.   Topics will range from Fair Trade Initiative updates to technical information and everything in between. 
Check back often for new and exciting blog posts.  Also, AEC welcomes comments and supports discussions on each entry.  Share this blog with colleagues within your company and within the industry, as well as end users; all will find posts of interest here!
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