U.S. Implements Restrictions on Polyester Fiber

Trade Update • Nov. 19, 2024

resident Biden has enacted a safeguard measure under Section 201 of the Trade Act to address the significant rise in imports of fine denier polyester staple fiber (PSF). Following a determination by the U.S. International Trade Commission (USITC) that such imports are a substantial cause of serious injury to the domestic industry, the measure aims to provide relief and support domestic manufacturers.

Safeguard Action

The safeguard introduces a quota system on certain temporary imports under bond of fine denier PSF classified under HTSUS 5503.20.00, specifically statistical reporting numbers 5503.20.0025 and 9813.00.0520. The quota will be implemented as follows:

• Year 1: Quota set to zero.
• Years 2–4: Annual increments of one million pounds.
• Effective Date: Quota begins at 12:01 a.m. EST on November 23, 2024.

The restriction targets fine denier PSF, not carded or combed, measuring less than 3.3 decitex (three denier) in diameter, whether coated or uncoated. This fiber is widely used in products such as yarn, apparel, sanitary goods, non-woven fabrics, carpets, and upholstery.

Exemptions for Certain Trading Partners

Imports from the following countries will be exempt from the quota, provided specific conditions are met:

• Canada and Mexico: Excluded based on findings that their imports do not significantly contribute to the injury.
• Free Trade Agreement Partners: Exemptions include Australia, Colombia, Israel, Jordan, Panama, Peru, Singapore, and the Dominican Republic-Central America Free Trade Agreement (CAFTA-DR) countries.
• Developing Countries: Countries under the Generalized System of Preferences (GSP) and Caribbean Basin Economic Recovery Act (CBERA) are also excluded if their import shares meet designated thresholds.

Considerations for Domestic and Downstream Industries

The president opted against imposing a tariff-rate quota (TRQ) to balance the interests of various stakeholders. While supporting U.S. manufacturers of fine denier PSF, the administration also considered the impact on downstream producers in the textile, defense, and consumer goods sectors that rely on these imports (PSF).

Key Provisions and Implementation

• Quantitative Restriction: Imposed on Temporary Importation under Bond (TIB) entries of fine denier PSF for four years, with gradual quota increases.
• Developing Countries: Exempted unless their import shares exceed 3% individually or 9% collectively.
• HTS Modifications: Adjustments to the Harmonized Tariff Schedule (HTS) reflect the safeguard action.

Protecting Domestic Industry

This action underscores the administration’s commitment to protecting domestic industries while maintaining equitable trade practices. The safeguard will remain in place for four years, with potential adjustments based on trade data and consultations with international partners.

Questions about these new restrictions? Email us at: gts@ghy.com, or call: +1 (800) 667-0771