03.22.11

SCHUMER: LAST MAJOR SYRACUSE CANDLE MAKER AT RISK BECAUSE OF UNFAIRLY TRADED CHINESE CANDLES FLOODING THE MARKET SCHUMER TO FEDS: MAKE SURE ANTI-DUMPING LAWS STAY STRONG TO KEEP CATHEDRAL CANDLE IN BUSINESS

Chinese Companies Are Circumventing U.S. Trade Laws, Finding Loopholes To Dump Candles Into U.S. Market And Avoid Payment of Customs DutiesAs Commerce Dept. Decides On New Anti-Dumping Guidelines, Schumer Urges Feds Not To Open Up More Loopholes For Chinese Companies Already Engaged in Predatory PricingSchumer: We Should Level the Playing Field and Protect Syracuses Heritage As A Candle Making City, Not Help Chinese Candle Makers Destroy Syracuse Jobs

Today, U.S. Senator Charles E. Schumer announced that he is pushing the U.S. Department of Commerce to protect Syracuse candle making jobs that are being put at risk by the unfair trade practices of Chinese candle exporters. Currently, the U.S. imposes an import tariff on cheap candles that Chinese companies send to the U.S. in an attempt to undercut domestic producers like Cathedral Candle. These tariffs have helped push back against the unfair trade practices of the Chinese, boosting domestic production of candles. However, next month the U.S. Department of Commerce is set to release a new set of rules that would limit the candles that are subject to the antidumping duty based on the size and shape of the candle. Dramatically narrowing the scope of the protections would make it easier for the Chinese to circumvent these tariffs by making slight modifications to the size and shape of their candles. These guidelines would seriously weaken U.S. efforts to fight unfair trade practices by the Chinese, and put companies like Cathedral Candle at a significant market disadvantage. In a letter sent to Commerce Secretary Gary Locke today, Schumer opposed these new rules and urged the Commerce Department not to open up loopholes making it easier for Chinese exports to undercut American manufacturers.
 
"Syracuse has a long and storied past as a candle making city, but with only one major candle maker left in town, it's clear that those days are on the brink of melting away," said Schumer. "Rather than making it easier for Chinese candle exporters to slide through loopholes and circumvent our trade laws, we need to crack down on the flood of cheap imports that are putting these seventy jobs at risk. I am going to fight tooth and nail against this shortsighted proposal that is unfair to the men and women employed at Cathedral Candle. Instead of than handing China yet another advantage, we should be enacting smart, tough rules that level the playing field in the candle market."
 
Senator Schumer was joined by company President Louis Steigerwald, Vice President Mark Steigerwald, and company employees as he announced his effort to protect Syracuse jobs from unfair Chinese trade practices. The process of dumping occurs when a foreign producer sells a product in the United States at a price that is below that producer's sales price in its home market, or at a price that is lower than the cost of production. As a result of an investigation by the Commerce Department and the International Trade Commission, antidumping duties were imposed to offset Chinese dumping of candles in the U.S. market.  The duties - currently set at 108 percent - have gone a long way towards protecting the remaining U.S. candle manufacturers, including Cathedral Candle Company, from further harm, and in keeping manufacturing jobs in this industry in the United States and in the state of New York.  In 2010, Commerce and the ITC reconsidered the imposition of antidumping duties to imported Chinese candles and concluded that termination of the duties would be likely to lead to continuation or recurrence of dumping and economic harm to the U.S. candle industry.  As a result, in January 2011, protections for U.S. candle makers were continued.  
 
However, Commerce has proposed to redefine and narrow the scope of the antidumping duty order on candles from China - limiting application of dumping duties to only certain shapes and sizes of Chinese candles.  By making it easier for Chinese companies to circumvent antidumping tariffs, the proposed limitations would provide a big boost to Chinese candle manufacturers at the expense of U.S. candle manufacturers already suffering significant economic injury. For example, if Commerce' guidelines stipulate that 12inch pillar candles are subject to import tariffs, a Chinese manufacturer could simply add half an inch to the length of the candle and avoid paying the tariff. Schumer believes that Commerce should protect American candle makers like Cathedral Candle Co. by subjecting a wide range of candles to the antidumping duties, and not just those on a narrowly defined list. A final decision from the Commerce Department could come as early as next month.
 
Chinese candle companies have already attempted to cheat the antidumping system in a variety of ways. They have successfully created a bureaucratic backlog in the United States by flooding the Commerce Department with requests as to which candles are subject to dumping duties, draining resources away from trade rule enforcement. Some manufacturers have even gone as far as to ship candles to the U.S. without wicks to change their import classification, and even intentionally mislabeling the country of origin. Today, Schumer urged the Commerce Secretary not to open any more loopholes that would make it easier for Chinese candle importers to undercut Cathedral Candle Company and other domestic producers.
 
Cathedral Candle Company is over 100 years old, employs 70 workers, and is currently in its fourth generation of family ownership. The company makes the vast majority of candles used in churches throughout the United States.

A copy of Senator Schumer's letter to Commerce Secretary Locke is below:
 
March 22, 2011
 
The Honorable Gary Locke
Secretary of Commerce
1401 Constitution Avenue, NW
Washington, DC 20230
 
Dear Secretary Locke,
 
I write to express my concern regarding Commerce's proposal to redefine and significantly narrow the scope of the antidumping duty order on Petroleum Wax Candles from China.  The duties imposed on dumped imports of Chinese candles have gone a long way towards protecting the remaining U.S. candle manufacturers - including New York manufacturer Cathedral Candle Company - from further harm, and in keeping manufacturing jobs in this industry in the United States and in my state of New York.  The proposed change - to limit application of dumping duties to only certain candle shapes and sizes - will provide a huge boost to Chinese candle manufacturers at the expense of U.S. candle manufacturers already suffering significant economic injury.  
 
Cathedral Candle Company has deep roots in the state of New York, with over a century of traditional and modern candlemaking expertise.  Founded in 1897 by Joseph Steigerwald, Cathedral Candle still produces candles on the original molds, presses and inventive automation devices built to the founder's specifications, along with modern, stateoftheart candle manufacturing equipment.  Cathedral Candle is owned and operated members of the Steigerwald family, and the original factory, on Kilpatrick Street in Syracuse, remains the core of Cathedral's expanded manufacturing facility.  America's religious candlemaking industry began in Syracuse and, today, most candles used in American churches still come from Cathedral Candle.  Generations of American workers and their families have depended on Cathedral Candle for their livelihoods.  Over 70 local craftspeople and their families still do so today. 
 
Cathedral Candle, and other domestic candle manufacturers, face crippling competition from dumped imports of candles from China.  Commerce's proposal to scale back the scope of candles subject to antidumping duties would cause significant economic harm to the remaining U.S. candle companies and their workers, as well as the communities in which they operate.  Commerce's proposal also has the perverse effect of rewarding Chinese candle exporters for years of outrageous schemes to avoid payment of dumping duties. 
 
Since the imposition of antidumping duties on Chinese candles, exporters have tried everything from mislabeling the country of origin to misidentifying candles as "articles of wax" by shipping them without wicks (which are then inserted after importation) to evade paying millions of dollars in duties.  Exporters also have worked to overload the system, filing hundreds of scope ruling requests creating a huge backlog at Commerce and allowing Chinese candles to enter the U.S. without payment of antidumping duties.  Rather than reward Chinese exporters for subverting U.S. trade laws, Commerce should acknowledge that a comprehensive scope is the only option that will help protect Cathedral Candle and other U.S. manufacturers, and their employees, from unfair trade practices and continued economic harm. 
 
I respectfully urge you to side with U.S. manufacturers and recognize that inclusion of all shapes and sizes of candles within the scope of the antidumping order is the only way to protect the integrity of the order and the remaining U.S. candle manufacturers - including New York manufacturer Cathedral Candle Company - from further harm.  Thank you for your attention to this matter.  I ask that you please keep me apprised of developments on this issue.
 

Sincerely,
 
U.S. Senator Charles E. Schumer 



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