Chinese Plywood Imports starts Trade War With Europe

Europe will impose a 62.4% Duty on Chinese Plywood Imports from the 11th of June

The European Union is implementing new measures in response to a significant increase in Chinese Plywood Imports. As of today, duties of up to 62.4% will be imposed on these imports for a minimum duration of six months.

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The European Commission has confirmed the imposition of a provisional anti-dumping duty on hardwood plywood imports from the People’s Republic of China. Additionally, a monitoring mechanism will be introduced to track imports of modified products, aimed at addressing potential circumvention of anti-dumping duties.

These actions follow concerns raised by the Greenwood Consortium, a lobby group representing hardwood plywood producers in Poland, Finland, France, and the Baltic states. The consortium has alleged that Chinese imports are being sold at artificially low prices, which they claim undercut European producers and violate fair trade rules.”

A statement published yesterday by the consortium noted, “We welcome the commission’s decision to impose provisional anti-dumping duties, but call for definitive duties to be higher than these provisional levels in the final decision later this year.”

The statement also expressed appreciation for the commission’s proactive approach to addressing circumvention attempts by Chinese exporters.

According to the European Commission, consumption of hardwood plywood has decreased by more than 30% over the three years covered in the investigation, attributed partly to “the end of the post-COVID-19 economic rebound.” During this period, the quantity of hardwood plywood imported from China reportedly increased significantly in both absolute and relative terms.

The complaint alleged that Chinese imports included wood sourced from Russian forests. The investigation examined wooden sheets—excluding bamboo and okoumé—with a ply thickness of no more than 6 mm, classified under HS codes 4412 31, 4412 33, and 4412 34. The complaint, made by the Greenwood consortium, stated that these imports contained wood sourced from Russian forests despite the EU embargo on Russian imports.

The complaint alleges that Chinese products are sold significantly below production costs, which may undercut producers and distort the European market. It also states that Chinese manufacturers benefit from various market distortions, including state subsidies and interventions that artificially reduce production costs. These distortions reportedly include lower prices for raw materials, capital, labor, and energy, providing exporters with a competitive advantage.

Currently, China accounts for more than 70% of the world’s plywood production, including over 50% of plywood traded within the European common market. However, its global production share is reportedly declining amid increasing competition, with countries such as the United States, Morocco, Turkey, and South Korea imposing trade sanctions on Chinese plywood imports.

According to Wang Peng, an associate research fellow at the Beijing Academy of Social Sciences, anti-dumping investigations in international trade can often lead to trade frictions and tensions. He pointed out that the European Union’s actions could affect not only the interests of industries within the bloc but also trade relations between China and Europe. This situation is occurring during a period of rising competition between the EU and China. Reports indicate that China has actively opposed the European Union’s deforestation regulation, and a 45% tariff placed on Chinese electric vehicles resulted in a retaliatory tariff by China on European whisky. Alicia García Herrero, a senior fellow at the Bruegel think tank, commented that the era of cooperation between China and the EU may have shifted towards competition across various industries.