Countervailing duties likely to be imposed on Sri Lankan steel nail exports to U.S.

By Nishel Fernando
Triggering fears on potential countervailing duties (CVD) on steel nail exports from Sri Lanka, the U.S. Department of Commerce (DoC) has determined that certain steel nail exports from Sri Lanka have been unduly benefiting from the countervailable subsidies in the U.S. market and it might have caused adverse impacts on the domestic producers, according to a recent notice published on the Federal Register.

The International Trade Administration Agency under the DoC launched an investigation into certain steel nail imports from Sri Lanka and a few other countries violating the anti-dumping and CVD laws, following the petitions filed on December 30, 2021 by the largest steel nail producer in the U.S., Mid Continent Steel & Wire, Inc.

On the 15th of this month, the DoC in its final determinations estimated that particular steel nail exporters from Sri Lanka enjoy the 4.12 percent net countervailable subsidy rate, which could be in the form of direct cash payment, credits against taxes and loans at terms that do not reflect market conditions.

According to the DoC, Sri Lanka exported US $ 31.32 million, US $ 26.38 million and US $ 33.91 million worth of the particular variety of steel nails to the U.S. in 2019, 2020 and 2021, respectively.

The DoC has already instructed the U.S. Customs and Border Protection to suspend the liquidation of entries of the subjected steel nail imports entered or withdrawn from the warehouse for consumption on or after June 7, following the preliminary determinations of the investigation.

On September 29 and October 6, this year, the U.S. International Trade Commission is scheduled to issue a final affirmative injury determination and orders, which could potentially impose CVD on steel nail exports from Sri Lanka.