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The U.S. Department of Commerce has announced preliminary affirmative determinations in its countervailing duty (CVD) investigations of brake drums imported from the People’s Republic of China and the Republic of Türkiye. These investigations follow a petition filed in June 2024 by Webb Wheel Products, Inc., and the subsequent launch of both CVD and concurrent antidumping duty (AD) investigations in July 2024.
The notice from the International Trade Administration can be found on the Federal Register.
Background of the Investigations
- The petition was filed in June 2024.
- The Department of Commerce launched its CVD and AD investigations in July 2024.
- Preliminary Determination Announcement: The findings were issued on November 25, 2024, for China, and November 26, 2024, for Türkiye.
Subsidy Rates and Findings
Manufacturers from China:
- CAIEC Trailer Master Co., Ltd. / Trailer Master CVS Inc.: 41.51%
- Shandong ConMet Mechanical, Ltd. / Weifang ConMet Mechanical Products Co., Ltd.: 6.76%
- Non-Responsive Companies: 303.07%
- All Others: 16.17%
Manufacturers from Türkiye:
- EKU Fren ve Dok. San. A.S.: 0.89%
- Other Companies: 131.39%
- All Others: 98.77%
Key Details
The investigations found evidence of unfair subsidies provided to producers and exporters of brake drums from both China and Türkiye. These subsidies have been deemed countervailing under U.S. trade laws. For non-cooperative entities in both countries, Commerce applied adverse facts available (AFA) to determine significantly higher subsidy rates.
The products covered include brake drums made of gray cast iron, both finished and unfinished, with specific size and weight parameters. The scope also includes brake drums processed in third countries or imported as part of assemblies. Composite brake drums with more than 40% steel by weight are excluded.
Impact of Preliminary Determination
To address the impact of subsidized imports, Commerce has directed U.S. Customs and Border Protection to suspend liquidation of entries for covered brake drums. Importers must now post cash deposits at the rates determined by the preliminary findings.
The final CVD determination will align with the final AD determination, expected by April 2025 where the U.S. International Trade Commission (ITC) will determine whether these subsidized imports have caused material injury to the U.S. industry.
If final determinations affirm the preliminary findings, CVD orders will be issued that could result in additional duties on imports of brake drums from China and Türkiye.
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