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TRANSCRIPT
K. SCHIPPER: Hi, I’m K. Schipper with the latest in hard surfaces industry news from Radio Stone Update.
0:33
Supporters and critics of the Section 301 tariffs on Chinese goods — including natural stone and manufactured hard surfaces – are set to square off for another round beginning next month.
The move announced by the office of the U.S. Trade Representative – the USTR – in the Oct. 17 Federal Register will have that federal agency opening an online docket on Nov. 15 to receive comments on the tariffs through Jan. 17 of next year. All comments must be made through the website.
The move comes four years after the original tariff applications and a very long chain of lawsuits challenging them. To help people focus their comments, the USTR will offer a list of questions for the docket. The questions will be available by Nov. 1 at https://coments.USTR.gov. That URL will also serve as the entrance to the public docket two weeks later.
The comment period comes as part of a four-year review of Section 301 tariff authorizations. During the summer of 2018 the USTR, under the authorization of the Trump administration, improved the tariffs as part of a strategy to reach a new overall trade agreement with China.
Before the review, the Section 301 actions sparked legal challenges from importers of Chinese goods claiming the USTR failed to follow proper procedures. Those arguments led to the filing of more than 3,600 individual lawsuits, including more than 30 from hard surface importers. Those cases are still pending in front of the U.S. Count of International Trade.
The Section 301 tariffs are unrelated to the unfair-trade tariffs assessed by the U.S. International Trade Commission on Chinese quartz surfaces and porcelain that also went into effect, beginning in 2018.
2:31
EMERSON SCHWARTZKOPF: This is Emerson Schwartzkopf. Quartz-surface imports from Malaysia now need to be certified to make sure the material isn’t from China.
The International Trade Administration, or ITA – an arm of the Commerce Department – made it official policy on October 17 that Malaysian exporters and U.S. importers must confirm in writing, that shipments don’t contain any Chinese-made materials. The new rule includes slabs and any products using quartz surfaces.
The action came seven months after the ITA began investigating if companies – in a process called transshipping — were labeling Chinese-made quartz surfaces as Malaysian-made to avoid the 300-percent-plus unfair-trade tariffs on the material from China.
Nine Malaysian companies that didn’t cooperate in the ITA investigation won’t be eligible to certify future quartz-surface shipments.
In addition, the new certification process will apply to any Malaysian quartz surfaces received in the United States since last November 4th where paperwork hasn’t been fully cleared, or liquidated, by U.S. Customs and Border Protection.
Certifications will need to be filed with customs by Dec. 15, even if the material has been moved from a port-of-entry and eventually fabricated.
Malaysia went from shipping virtually no quartz surfaces to the United States before the Chinese tariffs went into effect in 2018 to becoming the fourth-largest source of the material last year, accounting for 16.3 million ft².
The ITA investigation alone appears to have throttled most of the Malaysian quartz-surface trade, however. An analysis by our Hard-Surface Report e-magazine shows shipments to the United States dropped from a monthly high this year of 1.6 million ft² in March to not quite 138,000 ft² in August.
4:35
SCHIPPER: Quarra Stone is now constructing a new $19 million headquarters and work facility in Sun Prairie, Wis. State and local officials joined company CEO Jim Durham for a brief groundbreaking ceremony Sept. 28 on the company’s new 25-acre campus.
The company is building a new 65,000 ft2 production and office building that will double Quarra’s production capacity when it moves from its current location in nearly Madison, Wis., in the middle of next year.
The two-story stone-and-steel facility will be set in an ecologically restored landscape and integrate sustainable, natural hydrological systems. With the move, Quarra expects to add at least two dozen jobs to augment the 65 now working for the company.
The project received support from the Wisconsin Economic Development Corp. The group authorized up to $350,000 in state income-tax credits over the next three years, with the total depending on job creation and capital investment during that period.
Founded in 1998, Quarra produces custom-cut stone for architects, artists and mason for use in building restoration projects nationwide. Among its most-notable jobs with material for the U.S. Capitol Visitor Center.
Quarra is also the sole North American distributor of Vals quartzite from Switzerland and Polardur limestone from Spain.
5:47
A Word from Quantra
7:00
M S International, Inc. – MSI – recently opened a new outlet in Connecticut. The surfaces company held a grand opening Oct. 13 at its newest showroom and distribution center in Wallingford, Conn., just north of New Haven.
The approximately 70,000 ft2 showrooms offers a complete lineup from flooring and countertops to natural stone, hardscape materials and more for residential and commercial projects. Areas throughout the showroom feature products for a diverse customer base accommodating a variety of trends, lifestyles and budgets.
The new location features a state-of-the-art slab area with a variety of natural-stone materials, including marble, granite and quartzite, as well as a Premium Q Natural Quartz™ gallery showcasing more than 100 colors in the Q™ Collection lineup.
Founded in 1975, the Orange, Calif.-based MSI is a leading supplier of flooring, countertop, wall tile, and hardscaping products, with more than 40 state-of-the-art showrooms and distribution centers across the U.S. and Canada.
8:10
SCHWARTZKOPF: A quick look at recent imports of hard surfaces can make anyone wonder if U.S. consumers are even aware about inflation, recession, or worldwide supply-chain issues. The total customs value for natural stone, quartz surfaces and porcelain received in August came to $593.5 million, up 10.2 % from July and 22.9% from a year ago.
Quartz slab led all sectors with $168.7 million in value, but that’s just ahead of porcelain at $163.7 million. All other sectors noted month-to-month increases, except for non-roofing slate.
Quartz surfaces also recorded stellar figures in volume, with August being the first month ever when more than two million square feet rolled through U.S. ports-of-entry. That’s up more than 20% than same time last year. Porcelain also set a all-time monthly high at 138.9 million ft², up nearly 27 % from August 2021.
All other sectors showed increases in volume, again except for non-roofing slate.
You can learn more about U.S. imports with the monthly Hard-Surface Report e-magazine. There’s a new issue coming out this week with all the latest data. Go to latest.hardsurfacereport.com.
SCHIPPER: In other news around the industry…
9:51
Manu Shah, CEO of M S International Inc. – MSI – was recently named the Orange, Calif.-Chamber of Commerce’s first Corporate Citizen of the Year. The award was presented during the chamber’s annual State of the City event Oct. 7.
Chamber Executive Director Elizabeth Holloman says the Citizens of the year committee were so impressed with Shah’s contributions to the community that it felt compelled to create a new award. Going forward, the award will be given to corporate leaders who have made a significant impact on the City of Orange.
MSI employs more than 500 people in Orange and has established itself as the largest distributor of home-improvement materials in the city. At the same time, Manu Shah and his family support non-profits such as Habitat for Humanity, United Cerebral Palsy of OC, Pretend City, Orangewood Foundation and the Orange Senior Center, among others.
10:52
A stone fabricator has made the grade this year with the National Kitchen & Bath Association – the NKBA – as it released its list of Thirty Under 30 Class of 2023. Christopher Ribeiro is the chief operations officer for Absolute Stone Design in Glen Allen, Va.
The Thirty Under 30 program is designed to recognize talented young kitchen and bath professionals and help nurture them in their careers. Ribeiro is a member of the NKBA’s Virginia chapter and is a second-generation stone craftsman, as well as a graduate of Rollins College.
11:31
And, Martin Howard, executive vice president of operations for the David Allen Company of Raleigh, N.C., is this year’s recipient of the National Tile Contractors Association Ring of Honor. Howard is a past president of the NTCA and was previously honored as its Tile Person of the Year in 2017.
Howard will receive his Ring of Honor at Total Solutions Plus on Nov. 7 during a special awards lunch at the Hyatt Regency Indian Wells Resort & Spa in Indian Wells, Calif. The award is given to deserving industry leaders who support the association’s strategic objectives.
Remember, our online newsletter, Slab & Sheet, appears on alternate Wednesdays. For notes and a transcript of this podcast, go to www.radiostoneupdate.com.
For Radio Stone Update, I’m K. Schipper and we’ll see you here again soon.
