Saxco Update - August 2024
Commerce makes affirmative preliminary antidumping determinations
Welcome to the August update from our friends at Saxco, on market dynamics in beverage packaging. This update first appeared in August’s Ciatti California Report, which you can find on Substack here.
Despite the macro-economic challenges, the CrowdStrike outage, the geopolitical tensions, and the exciting Olympics, the wine packaging market has remained rather stable for the last month.
However, the US Department of Commerce (Commerce) recently made affirmative preliminary antidumping (AD) determinations regarding glass wine bottles and similar glass bottles (740ml-760ml) imported from China, Mexico, and Chile.
As a result of these preliminary findings, imports of in-scope glass bottles will incur AD cash deposit requirements at rates within the ranges indicated below. As with the countervailing duty (CVD) cash deposit requirements announced in May 2024, AD cash deposits represent payments of estimated tariffs, and any final AD tariff liability will be determined at a later date. The applicable cash deposit rate depends upon the foreign company that manufactured (or exported) the imported bottles, and rates generally vary among manufacturers within each country. The complete list of manufacturers by country and their respective rates can be found at this link.
Key Updates
Preliminary AD and CVD Cash Deposit Rates: The following table shows the ranges of cash deposit rates resulting from Commerce’s recent preliminary AD determinations, along with the CVD cash deposit rates that Commerce announced on May 29, 2024. The AD and CVD cash deposits imposed on imports from China are additive. For example, imports from a Chinese manufacturer with an AD rate of 11.96% and a CVD rate of 21.14% are subject to a combined AD/CVD cash deposit rate of 33.1%.
Effective Date for Cash Deposits: The cash deposit requirements for these duties take effect on August 9, 2024 which is the date the preliminary determinations were published in the Federal Register.
Retroactive charges:
China: Retroactive AD cash deposits apply to imports that entered the US during the 90 days preceding the Federal Register publication date if the glass bottles were produced by Chinese manufacturers that Commerce found to be part of the “China-wide entity.” Imports from manufacturers found to be separate from the China-wide entity do not face retroactive charges.
Mexico and Chile: No retroactive cash deposit requirements apply.
Next Steps
These preliminary findings may change, either because of Commerce’s final AD determinations or the US International Trade Commission’s (ITC) final injury determinations. If both the Commerce and the ITC issue affirmative final rulings, AD and CVD tariffs will be imposed for at least five years.
Here is an updated timeline below. Note that some deadlines have been extended since we provided our original communication.
These decisions introduce a new layer of complexity that producers must consider when sourcing glass for this year and the next.
Bottled Tidbits - Did you know that the standard 750ml wine bottle size was only recently established in the 1970s, to align with global trade and shipping standards?