The U.S. Department of Commerce, International Trade Commission has issued its final ruling on the appeal of its dumping duties on tapered roller bearings and components from China, specifically for TRBs from Peer Bearing Company - Changshan (CPZ). The Commerce Case Number is A-570-601, 5251R9N7, and the period under review is June 1, 2007 through May 31, 2008.

A year ago, the DOC issued its antidumping duty rates on TRBs from China, slapping every manufacturer, including Yantai Timken and CPZ, with 92.84% for the previous period -- June 1, 2006 through May 31, 2007.

article: Commerce changes duties on TRBs from China
That had marked the first time Commerce hit tapered roller bearings from China, regardless of their source, with a 92.84% antidumping duty, up more than 50% from the initial finding in the review, which would have kept the duty at 60.95%.

This increase was a critical development in the bearing industry, not only because so many tapered roller bearings in the U.S. market are from China, but also because the U.S. "all other" rate for tapered roller bearings from China had been held at 60.95% for the past 17 years, since it was first levied back in 1993.

Peer CPZ protested the 92.84% duty, going after the decision for the next period of review, June 1, 2007 through May 31, 2008. As a result, the DOC recalculated Peer CPZ's antidumping duty margin, correcting the direct material calculation for bar and tube steel.

The actual arguments go deeper, however. Peer CPZ argued that TRBs are not actually bearings until the final turning and grinding operations have occurred. CPZ does not do final turning and grinding in China, so it argued the products produced in China were not yet bearings, that the bearings were actually produced in the other country, and so should not be hit with bearing duties as if they were from China.

The DOC disagreed, saying the finishing operations only fine tune the item, that it is already essentially a TRB and cannot be anything but a TRB when it leaves China:

Therefore, we continue to find that the physical/chemical properties and the essential character of a TRB are imparted in the forging, turning and heat treatment operations, as well as the roller and cage operations, all of which take place in the PRC. While there is some sizing and smoothing change in the finishing process, the physical/chemical property changes imparted by the forging, turning, and heat treatment processes, as well as the roller and cage production, are the most significant.

The key argument CPZ did win, however, was convincing Commerce that the price data it was using for tube steel was incorrect and incomplete (DOC uses surrogate prices for China, because China is considered a non-market economy, so DOC substitutes what that same thing would cost in an open economy). In this case, CPZ convinced Commerce to use the value of steel in India, rather than the widely fluctuating and incomplete Thailand steel price data it had been using.

Issues and Decision Memorandum : A-570-601 : AD/CVD 08: FMV/BQ

producer / exporter	original duty	most recent	new
Peer Bearing Company Changshan (CPZ)	59.41%	92.84%	24.62%
PRC-wide "all other" including Yantai Timken	60.95%	92.84%	92.84%