On November 20, 2024, Thailand's Department of Foreign Trade, part of the Ministry of Commerce, initiated the second "sunset review" of anti-dumping duties on cold-rolled stainless steel products imported from China. The review was triggered by a request from POSCO-Thainox Public Company Limited, one of Thailand's key manufacturers of stainless steel. POSCO-Thainox expressed concerns that if the existing AD duties were allowed to expire, Chinese stainless steel manufacturers would once again engage in dumping practices, potentially flooding the Thai market with cheap imports and harming the local industry.
The anti-dumping duties currently in place are designed to protect domestic manufacturers from unfair competition by ensuring that imported goods are not sold at artificially low prices. The review process, known as a sunset review, is standard practice for trade remedies like AD duties. Under Thai law, sunset reviews are conducted periodically to assess whether the duties should be continued, amended, or terminated. The review will assess whether the expiration of the duties would lead to a resumption of dumping and injury to Thailand’s domestic stainless steel producers.
During the sunset review, anti-dumping duties will continue to be collected in the form of a deposit on the imported cold-rolled stainless steel products. This deposit will remain in place for up to one year or until the conclusion of the review process. The review period allows Thai authorities to assess the current situation and determine whether the domestic industry continues to be at risk from unfair trade practices. If the duties are determined to be necessary, they will be maintained for a specified period. On the other hand, if the review concludes that the removal of the duties will not lead to dumping or injury, the duties could be revoked.
The cold-rolled stainless steel products under scrutiny include a range of forms, including coils, sheets, and strips, which are essential in industries such as automotive manufacturing, construction, electronics, and home appliances. These products are classified under several specific HS codes, including 72193200030, 72193200040, 72193300030, 72193300040, 72193400030, 72193400040, 72193500030, 72193500040, 72202010030, 72202010040, 72202090030, and 72202090040. The review will specifically address the impact of these products on the domestic market, examining whether they are being sold at unfairly low prices or whether their importation has caused damage to Thai manufacturers.
The anti-dumping duties on Chinese cold-rolled stainless steel products were originally imposed after an investigation found that Chinese manufacturers were selling stainless steel at prices below their production costs, a practice known as "dumping." Dumping can harm local industries by driving down prices, which can lead to financial losses for domestic producers. The original AD measures were implemented as a way to level the playing field and protect Thai steel producers from the negative effects of such pricing practices. However, these measures are not permanent and must be reviewed periodically to assess their continued necessity.
POSCO-Thainox’s request for the sunset review is rooted in the belief that if the anti-dumping measures are lifted, Chinese steel producers may resume dumping cold-rolled stainless steel at low prices, which would likely harm the domestic industry. The company argues that lifting the duties would allow Chinese products to flood the market once again, undermining the competitiveness of Thai manufacturers who rely on fair pricing to maintain profitability and market share. The review process will take into account a variety of factors, including current market conditions, production costs, and pricing trends in both the domestic and international markets.
For Thailand, which is one of the leading markets for stainless steel in Southeast Asia, the outcome of this sunset review could have significant implications for its steel industry. Stainless steel is a crucial material used in a wide range of sectors, and the country’s manufacturing sector relies heavily on a stable supply of competitively priced steel. If the duties are extended, domestic producers like POSCO-Thainox would likely benefit from continued protection, ensuring that they can maintain their market position without the threat of cheap imports. On the other hand, if the duties are revoked, it could lead to lower prices for consumers and businesses that rely on imported stainless steel, but at the cost of potentially harming local producers.
In the coming months, Thailand will closely monitor the results of the review, considering both the interests of its domestic steel industry and its obligations under international trade agreements. The process is expected to take several months, during which time stakeholders from various sectors, including manufacturing, trade, and government, will weigh in on the potential impact of the duties. Whether the AD duties are continued or lifted, the review will ultimately play a key role in shaping the future of Thailand’s steel market and its broader trade relations with China and other steel-producing countries.
