The International Trade Commission probably will decide by mid-March whether to reconsider its 55-percent anti-dumping duties on polychloroprene rubber from Japan, according to an attorney representing Gates Corp. in the case.
Gates petitioned the ITC in November, asking the agency to review the 33-year-old duties that were reaffirmed only last June. The closure of Polimeri Europa S.p.A.'s polychloroprene plant in France, Gates said, as well as DuPont Performance Elastomers L.L.C.'s plans to shutter its neoprene facility in Louisville, Ky., represented changed circumstances that mandated a new review.
DuPont said Gates' characterization of the polychloroprene rubber supply situation is inaccurate and alarmist, and that Gates has no standing to challenge the duties because it is not a neoprene rubber producer.
The ITC published a call for comments in the ``Federal Register,'' said Frank Schuchat, an attorney with the Denver firm of Schuchat, Herzog & Brenman L.L.C. The deadline for comments was Feb. 10, and the ITC told Schuchat it had 30 days after that deadline to decide whether to reopen the case, he said.
Gates is one of a number of U.S. rubber companies that claim U.S. neoprene rubber supplies are growing alarmingly short. Several other firms and groups supported Gates in their comments, including Goodyear and the Motor & Equipment Manufacturers Association.
``Since Polimeri closed its plant, DuPont has had, in effect, a monopoly in the U.S.,'' Goodyear said in its comments to the ITC, a view echoed by other commenters.
DuPont's polychloroprene price increase in the fourth quarter of 2005 alone was 22 percent, which meant an added expense of $4.5 million to Goodyear's Engineered Product Division that quarter, Goodyear said.
Goodyear, MEMA, and Gates all said DuPont and Lanxess Corp., the one remaining polychloroprene rubber importer to the U.S., probably would be unable to meet U.S. demand for the polymer.
``The lack of adequate supplies of (neoprene) limits development and expansion of U.S. manufacturing of auto parts because prices are too unstable and supply is too short,'' MEMA said in its comments. ``Ultimately, the lack of (neoprene) may cause the closure of domestic industries that use it.''
Among the other rubber industry companies making comments was rubber compounder Excel Polymers L.L.C. ``Continuation of the anti-dumping order represents an urgent and serious threat to the long-term viability of a number of significant U.S. manufacturing operations,'' Excel told the ITC.
DuPont denied that the rubber companies' arguments have any merit. The firm said its ability to supply neoprene in the wake of the hurricanes that coincided with Polimeri's announcement show it is a reliable supplier of the synthetic rubber. ``There is also no evidence that Polimeri's exit resulted in the (polychloroprene rubber) price increases that took place since June 2005, or would result in future price increases. To the contrary, the evidence shows that raw material and energy costs continue to escalate.''
Lanxess backed DuPont in opposing the review.
China is scheduled to boost its neoprene capacity by 30,000 metric tons this year, and some of this rubber may well find its way to the U.S., Lanxess said. The ITC already knew this when it reaffirmed the duties against Japanese producers in June 2005, it said.
One of the comments came from a Tokyo-based neoprene producer, Tosoh Corp. Tosoh said maintaining the duties has no pratical effect, and it has no excess rubber to sell to the U.S., anyway.
Meanwhile, United Steelworkers Local 5-2002, which represents workers at the DuPont Louisville plant, is using the complaints of Gates and others as a pretext for challenging the pending closure of the facility.
Carl Goodman, president of Local 5-2002, sent letters in December to Sen. Mitch McConnell, R-Ky., and Rep. Anne Northup, R-Ky., asking their help to keep the Louisville plant open and its 200-plus workers on the job. Goodman said the letters have gone unanswered.
Sen. McConnell's staff still was checking on the status of the letter at press time, while a spokeswoman for Rep. Northup's office declined comment.