Trade commission recommends slapping antidumping duties on Chinese plywood

South Korea's trade commission said Tuesday that it will recommend slapping antidumping duties on Chinese plywood made with needleleaf trees.

The Korea Trade Commission said it confirmed unfair price cutting practices that distorted the market and decided to set punitive tariff rates of 4.22-7.15 percent. It said these measures would be enforced for four year.

It said the recommendations have been sent to the finance ministry, which will make the final decision on what actions will be taken.

The KTC started its investigation after the Korea Wood Panel Association formally lodged a complaint against Chinese rivals on Jan. 30, 2015.

"In the past months, the commission has listened to both local companies who claimed they are being hurt by Chinese products, and suppliers in China," it said. Investigators held public hearings and even checked production facilities in China.

Seoul slapped antidumping duties on Chinese plywood made from broadleaf trees in Oct. 2013, causing Chinese supplies to switch to needleleaf trees. The switch allowed these companies to rapidly expand their market share in South Korea.

"The latest move is expected to allow fair competition in the market and protect local companies," the commission under the Ministry of Trade, Industry and Energy said.

As of last year, the local plywood market stood at 710 billion won ($603 million), with local products making up 24 percent of the total, with 18 percent coming from China. The rest are imported from other countries.

Besides action taken against plywoods, the KTC said it will start a probe on U.S. and French-made butyl glycol ether that is used in the production of paint, ink, detergent and antifreeze products.

The domestic market for the chemical stands at some 37.5 billion won, with local output accounting for 32.5 percent. U.S. companies hold a 52.8 percent market share with French firms holding another 12.8 percent.

A provisional ruling is expected out around March 2016, it said. (Yonhap)