U.S. producers of magnesium diecastings recently joined other manufacturers of magnesium alloy products to petition the U.S. International Trade Commission to end anti-dumping duty orders on magnesium. The ITC is a U.S. Commerce Dept. panel that sets tariff on imports and determines penalties for import violators.
The panel is in the midst of a mandated five-year (“sunset”) review of antidumping orders on magnesium alloys from China and pure and alloyed magnesium from Russia. The Uruguay Round Agreements Act requires the Commerce Dept. to revoke an anti-dumping or countervailing duty order, or terminate a suspension agreement, after five years unless the Department or ITC determines that doing so would lead to more dumping or subsidies within a reasonably foreseeable time.
ITC will issue its determination in February 2011.
The diecasters were supported by testimony from several legislators. Their argument is that terminating the anti-dumping duties would help their industry by encouraging greater competition in the magnesium alloy market and increasing demand for magnesium diecastings.
The sole domestic producer of primary magnesium and magnesium alloy is U.S. Magnesium LLC. Noting that global magnesium prices have increased since the AD orders were installed in 2005, the diecasters explain that their products are not globally competitive because of the distortion of the raw material price. “If the orders are revoked, the diecasters predict that demand for alloy magnesium will increase, leading to increased production,” Dan Twarog, president of the North American Die Casting Assn. (“NADCA”) explained.
Spartan Light Metal Products’ exec. vice president Michael Sparks testified that some of his firm’s customers have switched to foreign suppliers for their magnesium parts and subassemblies. “And some customers have switched to competing materials, such as aluminum and thermoplastics,” the Mexico, MO, manufacturer said.
“We have lost several diecasting projects to European and Asian competitors due to the high price of alloy magnesium,” according to Chicago White Metal Casting Inc. president and CEO Eric Treiber.
Other diecasters represented at the hearing included Twin City Die Castings Co., Pace Industries – Product Tech Division, PCC-AFT, and Mag-Tech Casting Corp.
Twarog documented for the ITC how several diecasters have discontinued their magnesium product lines and others have lost sales, encouraging the shift of R&D and jobs overseas. “The U.S. diecasting industry suffered nearly 38% unemployment in 2009,” he explained. “2010 unemployment is forecasted at 30%. This is three to four times the national average unemployment rate,” he said.
“Revoking these orders is a necessary step to the recovery of alloy magnesium producers,” according to Twarog.
NADCA and Diecasters Want More Choice in Magnesium Sourcing
Producers urge ITC to end AD orders on Chinese, Russian metal