Olin Joins U.S. Epoxy Resin Producers in Filing Trade Cases Against Five Nations

Olin Corporation (NYSE: OLN) made a significant announcement today, revealing the submission of antidumping and countervailing duty petitions targeting five countries concerning specific epoxy resins. This action is part of the U.S. Epoxy Resin Producers Ad Hoc Coalition's initiative. The petitions allege that the influx of unfairly traded imports of certain epoxy resins from China, India, South Korea, Taiwan, and Thailand has inflicted substantial harm upon the domestic epoxy resin industry. Additionally, they assert that the foreign producers have received significant subsidies from the governments of China, India, South Korea, and Taiwan. The coalition includes U.S. manufacturers, including Olin, who produce epoxy resins, a vital ingredient essential for a wide range of applications within significant sectors of the U.S. economy, including Aerospace, Automotive, Defense, Electrical Transmission, Semiconductors, and Wind Energy. The existence of domestically produced epoxy resins is vital for ensuring compliance with domestic preference requirements outlined in significant U.S. legislations like The Inflation Reduction Act (IRA), the Bipartisan Infrastructure Law, and the CHIPS and Science Act. Moreover, the availability of domestic epoxy production is pivotal for bolstering supply chain resilience within the U.S. industry.

Florian Kohl, President of Olin Epoxy, expressed concerns over the substantial volume of what they perceive as unfairly traded and subsidized imports of epoxy resin inundating the U.S. market. Kohl emphasized the adverse impact of these imports on pricing dynamics within the U.S. market, which, in turn, has significantly impeded Olin's production, sales, and earnings. He underscored the crucial need for relief under U.S. law to combat these unfairly traded imports, as failure to address the issue could jeopardize the sustainability of U.S. producers and adversely affect the welfare of their employees and local communities.

The petitions were formally lodged with the U.S. Department of Commerce ("Commerce Department") and the U.S. International Trade Commission ("USITC"). The five countries implicated by the antidumping petitions and the alleged dumping margins asserted by the domestic industry include:

The petitions also contend that foreign producers benefit from various countervailable subsidies. They were filed in response to the substantial influx of low-priced imports of epoxy resins from the subject countries over the past three years, which have inflicted injury upon domestic epoxy resin producers. Allegations within the petitions assert that producers in the subject countries have harmed U.S. epoxy resin producers by selling their products at unfairly low prices, significantly undercutting the prices offered by U.S. producers. Consequently, imports of epoxy resins have garnered an escalating share of the U.S. market, directly impacting the U.S. industry. Without the imposition of duties to level the playing field, U.S. producers are likely to endure continued price declines.

Antidumping duties aim to offset the extent to which a product is sold at a price lower than fair value, as determined by the Commerce Department. Estimated duties, equivalent to the dumping margin, are collected from importers at the time of importation. Countervailing duties, on the other hand, aim to counteract unfair subsidies provided by foreign governments to support the production of specific goods. The USITC, an independent agency, will undertake the determination of whether the domestic industry has suffered material injury or is threatened with material injury due to unfairly traded imports.