U.S. International Trade Commission

Wooden Bedroom Furniture

From China 

Investigation No. 731-TA-1058 (Preliminary)

 Publication 3667 January 2004 

 

Washington, DC 20436
U.S. International Trade Commission

COMMISSIONERS

Deanna Tanner Okun, Chairman

Jennifer A. Hillman, Vice Chairman

Marcia E. Miller

Stephen Koplan

Charlotte R. Lane

Daniel R. Pearson

Robert A. Rogowsky

Director of Operations

Staff assigned

Fred Fischer, Investigator

Gerald Benedick, Economist

Josephine Spalding-Masgarha, Industry Analyst

Justin Jee, Accountant/Auditor

Mara Alexander, Statistician

Neal Reynolds, Attorney

George Deyman, Supervisory Investigator

Address all communications to

Secretary to the Commission

United States International Trade Commission

Washington, DC 20436
U.S. International Trade Commission

Washington, DC 20436

www.usitc.gov

Wooden Bedroom Furniture

From China

Investigation No. 731-TA-1058 (Preliminary)

Publication 3667 January 2004

Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

i

CONTENTS

Page

Part I: Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-1

Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-1

Previous investigations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-2

Organization of the report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-2

Summary of data presented in the report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-2

The nature and extent of alleged sales at LTFV . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-3

Summary of market participants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-3

The subject product . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-4

Scope . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-4

U.S. tariff treatment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-5

Domestic like product issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-6

Physical characteristics and uses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-7

Common manufacturing facilities and production employees . . . . . . . . . . . . . . . . . . . . . . I-8

Interchangeability and customer and producer perceptions . . . . . . . . . . . . . . . . . . . . . . . . I-9

Channels of distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-10

Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-10

Part II: Conditions of competition in the U.S. market ............................... II-1

Channels of distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-1

Market characteristics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-3

Supply and demand considerations .............................................. II-6

U.S. supply ............................................................. II-8

Subject imports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-10

Nonsubject imports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-11

U.S. demand . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-11

Substitutability issues ..................................................... II-18

Part III: U.S. producers’ production, shipments, and employment ..................... III-1

U.S. producers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . III-1

U.S. capacity, production, and capacity utilization .................................. III-3

U.S. producers’ shipments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . III-4

U.S. producers’ purchases ..................................................... III-5

U.S. producers’ inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . III-6

U.S. employment, wages, and productivity ........................................ III-7

Part IV: U.S. imports, apparent consumption, and market shares . . . . . . . . . . . . . . . . . . . . . IV-1

U.S. importers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-1

U.S. imports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-1

U.S. producers’ imports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-4

Apparent U.S. consumption and U.S. market shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-4
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CONTENTS–Continued

Page

Part V: Pricing and related information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-1

Factors affecting pricing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-1

Raw material costs, fit, finish, and size/scale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-1

Tariff rates and transportation costs to the U.S. market . . . . . . . . . . . . . . . . . . . . . . . . . . . V-4

U.S. inland transportation costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-4

Exchange rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-6

Pricing practices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-7

Price data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-9

Price trends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-13

Price comparisons . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-20

Lost sales and lost revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-27

Part VI: Financial condition of the U.S. producers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-1

Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-1

Operations on wooden bedroom furniture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-1

Investment in productive facilities, capital expenditures, and research and development

expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-4

Capital and investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-5

Part VII: Threat considerations ................................................. VII-1

The industry in China ........................................................ VII-1

U.S. importers’ inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VII-4

U.S. importers’ current orders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VII-4

Antidumping duty orders in third-country markets .................................. VII-4

Appendixes

A. Federal Register notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-1

B. Calendar of public conference . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-1

C. Summary data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . C-1

D. The relationships among nominal exchange rates, real exchange rates, and producer price

trends, and the impact of changes in their values on prices of exports and imports . . . . . . . D-1

E. U.S. retailers’ import price data for their imported wooden bedroom furniture from China . . . E-1

F. Alleged effects of imports on U.S. producers’ existing development and production efforts,

growth, investment, and ability to raise capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-1
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CONTENTS–Continued

Page

Figures

II-1. Wooden bedroom furniture: Values of total U.S. shipments of domestic and imported

Chinese wooden bedroom furniture, by type of customer, January 2000-June 2003 . . . II-2

IV-1. Wooden bedroom furniture: U.S. imports, by sources, 2000-02, January-June 2002, and

January-June 2003 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-3

IV-2. Wooden bedroom furniture: U.S. producers’ subject imports as a share of domestically

produced U.S. shipments, 2000-02, January-June 2002, and January-June 2003 . . . . . . IV-7

IV-3. Wooden bedroom furniture: Apparent U.S. consumption, by sources, 2000-02, 

January-June 2002, and January-June 2003 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-9

V-1. Wooden bedroom furniture: U.S. weighted-average net f.o.b. selling prices and quantities 

of U.S.-produced and imported Chinese products 1A-1D (Louis Philippe style wooden

bedroom furniture pieces) sold to U.S. retailers, by quarters, January 2000-June 2003 . V-18

V-2. Wooden bedroom furniture: U.S. weighted-average net f.o.b. selling prices and quantities 

of U.S.-produced and imported Chinese products 2A-2D (Mission style wooden

bedroom furniture pieces) sold to U.S. retailers, by quarters, January 2000-June 2003 . V-18

VII-1. Wooden bedroom furniture: China’s capacity, production, and capacity utilization,

2000-02, January-June 2002, and January-June 2003 ........................... VII-3

E-1. Wooden bedroom furniture: U.S. weighted-average net c.i.f., duty-paid, landed (U.S. ports

 of entry) import prices and quantities and wholesale selling prices and quantities of 

imported Chinese products 1A-1D (Louis Philippe style wooden bedroom 

furniture pieces) imported by U.S. retailers and by firms selling at wholesale, 

respectively, by quarters, January 2000-June 2003. . . . . . . . . . . . . . . . . . . . . . . . . . . . . E-6

E-2. Wooden bedroom furniture: U.S. weighted-average net c.i.f., duty-paid, landed (U.S. 

ports of entry) import prices and quantities and wholesale selling prices and quantities

of imported Chinese products 2A-2D (Mission style wooden bedroom furniture pieces)

imported by U.S. retailers and by firms selling at wholesale, respectively, by quarters,

January 2000-June 2003. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . E-6

Tables

I-1. Wooden bedroom furniture: Chronology of investigation No. 731-TA-1058 . . . . . . . . . . . I-1

I-2. Wooden bedroom furniture: Largest U.S. producers and U.S. importers of the subject

merchandise, 2000-02 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-3

I-3. Wooden bedroom furniture: Largest U.S. purchasers of domestically produced product

and subject merchandise imported from China, 2000-02 . . . . . . . . . . . . . . . . . . . . . . . . . I-3

I-4. Wooden bedroom furniture: Tariff rates, 2003 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-6

II-1. Wooden bedroom furniture: Perceived degree of interchangeability of wooden bedroom

furniture produced in the United States, imported from China, and imported from

third countries ......................................................... II-18

II-2. Wooden bedroom furniture: Perceived importance of differences in factors other than

price between wooden bedroom furniture produced in the United States, imported

from China, and imported from third countries and sold in the U.S. market .......... II-19
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Tables–Continued

III-1. Wooden bedroom furniture: U.S. producers, locations of corporate headquarters,

positions taken with respect to the petition, shares of reported domestically

produced U.S. shipments in 2002, and whether firms directly imported the subject

merchandise from China in January 2000-June 2003 ......................... III-2

III-2. Wooden bedroom furniture: U.S. producers’ capacity, production, and capacity

utilization, 2000-02, January-June 2002, and January-June 2003 ................ III-3

III-3. Wooden bedroom furniture: U.S. producers’ shipments, by types, 2000-02, 

January-June 2002, and January-June 2003 ................................. III-4

III-4. Wooden bedroom furniture: U.S. producers’ purchases, by sources, 2000-02, 

January-June 2002, and January-June 2003 ................................. III-5

III-5. Wooden bedroom furniture: U.S. producers’ purchases of subject imports, U.S.

shipments, and ratio of purchases of subject imports to U.S. shipments, 2000-02, 

January-June 2002, and January-June 2003 ................................. III-5

III-6. Wooden bedroom furniture: U.S. producers’ end-of-period-inventories, 2000-02,

January-June 2002, and January-June 2003 ................................. III-6

III-7. Wooden bedroom furniture: Average number of production and related workers, hours

worked, wages paid to such employees, hourly wages, productivity, and unit

labor costs, 2000-02, January-June 2002, and January-June 2003 ................ III-7

III-8. Wooden bedroom furniture: U.S. producers reporting union representation of their 

production and related workers .......................................... III-8

IV-1. Wooden bedroom furniture: U.S. imports, by sources, 2000-02, January-June 2002,

and January-June 2003 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-2

IV-2. Wooden bedroom furniture: U.S. producers’ direct imports of the subject merchandise

from China, and U.S. producers’ shipments of domestically produced product,

by firms, 2000-02, January-June 2002, and January-June 2003 . . . . . . . . . . . . . . . . . IV-5

IV-3. Wooden bedroom furniture: U.S. shipments of domestic product, U.S. imports,

by sources, apparent U.S. consumption, and market shares, 2000-02, JanuaryJune 2002, and January-June 2003 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-8

V-1. Wooden bedroom furniture: Ranges of net U.S. f.o.b. selling prices at the low and high

price ends and simple averages of the reported prices for domestic and imported 

Chinese 4-piece wooden bedroom furniture suites, by quality categories, sold to U.S.

retailers during 2002. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-3

V-2. Wooden bedroom furniture: U.S. weighted-average net f.o.b. selling prices and quantities 

of U.S.-produced products 1A-1D (Louis Philippe style wooden bedroom furniture

pieces) and constructed 4-piece suite prices, based on sales to retailers, by quarters,

January 2000-June 2003 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-14

V-3. Wooden bedroom furniture: U.S. weighted-average net f.o.b. selling prices and 

quantities of U.S.-produced products 2A-2D (Mission style wooden bedroom 

furniture pieces) and constructed 4-piece suite prices, based on sales to retailers,

by quarters, January 2000-June2003 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-15
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CONTENTS–Continued

Page

Tables–Continued

V-4. Wooden bedroom furniture: U.S. weighted-average net f.o.b. selling prices and quantities

of imported Chinese products 1A-1D (Louis Philippe style wooden bedroom furniture

pieces) and constructed 4-piece suite prices, based on sales to retailers, by quarters,

January 2000-June 2003 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-16

V-5. Wooden bedroom furniture: U.S. weighted-average net f.o.b. selling prices and quantities

of imported Chinese products 2A-2D (Mission style wooden bedroom furniture

pieces) and constructed 4-piece suite prices, based on sales to retailers, by quarters,

January 2000-June 2003 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-17

V-6a. Wooden bedroom furniture: Summary of quarterly U.S. weighted-average net f.o.b.

selling price comparisons between the eight specified U.S.-produced and imported

Chinese wooden bedroom furniture products based on sales to retailers during

January 2000-June 2003, and reported Chinese import quantities involved in the

price comparisons. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-21

V-6b. Wooden bedroom furniture: Summary of quarterly U.S. weighted-average net f.o.b.

selling price comparisons of staff’s constructed prices between a U.S.-produced

and imported Chinese Louis Philippe style 4-piece bedroom furniture suite and a 

Mission style 4-piece bedroom furniture suite, which were based on sales of the

individual specified furniture pieces in each suite to retailers during January 2000-

June 2003 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-21

V-7. Wooden bedroom furniture: U.S. weighted-average net f.o.b. selling 

price of domestic and imported Chinese wooden bedroom furniture products 1A-1D

(specified Louis Philippe style wooden bedroom furniture pieces) and of the

constructed domestic and imported Chinese 4-piece suite price, and margins of 

underselling/(overselling),by quarters, January 2000-June 2003. . . . . . . . . . . . . . . . . V-22

V-8. Wooden bedroom furniture: U.S. weighted-average net f.o.b. selling 

price of domestic and imported Chinese wooden bedroom furniture products 2A-2D

(specified Mission style wooden bedroom furniture pieces) and of the constructed

domestic and imported Chinese 4-piece suite price, and margins of underselling/

(overselling),by quarters, January 2000-June 2003. . . . . . . . . . . . . . . . . . . . . . . . . . . V-24

V-9. Wooden bedroom furniture: U.S. producers’ lost sales allegations. . . . . . . . . . . . . . . . . . V-28

V-10. Wooden bedroom furniture: U.S. producers’ lost revenue allegations. . . . . . . . . . . . . . . . V-28

VI-1. Results of manufacturing operations of U.S. producers on wooden bedroom furniture,

fiscal years 2000-02, January-June 2002, and January-June 2003 . . . . . . . . . . . . . . . . VI-2

VI-2. Results of overall operations (including importing) of U.S. producers on wooden 

bedroom furniture, fiscal years 2000-02, January-June 2002, and January-June

 2003 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-3

VI-3. Selected data for reporting U.S. producers of wooden bedroom furniture grouped by

sales value, fiscal year 2002 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-4

VI-4. Capital expenditures, R&D expenses, and assets utilized by U.S. producers in their

production of wooden bedroom furniture, fiscal years 2000-02, January-June 2002,

and January-June 2003 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-4
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Tables–Continued

VII-1. Wooden bedroom furniture: Data on the industry in China, 2000-02, January-June

2002, January-June 2003, and projections for 2003-04 ........................ VII-2

VII-2. Wooden bedroom furniture: U.S. importers’ end-of-period inventories of imports,

by sources, 2000-02, January-June 2002, and January-June 2003 ................ VII-5

VII-3. Wooden bedroom furniture: U.S. importers’ orders and shipments, July 1, 2003-

December 31, 2003 .................................................... VII-6

C-1. Wooden bedroom furniture: Summary data concerning the U.S. market, 2000-02,

January-June 2002, and January-June 2003 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . C-3

E-1. Wooden bedroom furniture: U.S. weighted-average net c.i.f., duty-paid, landed (U.S.

ports of entry) import prices and quantities of Chinese products 1A-1D (Louis 

Philippe style wooden bedroom furniture pieces) and constructed 4-piece suite 

prices, imported by retailers, by quarters, January 2000-June 2003 . . . . . . . . . . . . . . E-6

E-2. Wooden bedroom furniture: U.S. weighted-average net c.i.f., duty-paid, landed (U.S.

ports of entry) import prices and quantities of Chinese products 2A-2D (Mission 

style wooden bedroom furniture pieces) and constructed 4-piece suite prices, 

imported by retailers, by quarters, January 2000-June 2003. . . . . . . . . . . . . . . . . . . . . E-6

NOTE

Information that would reveal confidential operations of individual concerns may not be published

and therefore has been deleted from this report. Such deletions are indicated by asterisks.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 1 The record is defined in sec. 207.2(f) of the Commission’s Rules of Practice and Procedure (19 CFR § 207.2(f)).

 2

 Commissioner Pearson makes a determination of threat of material injury.

 3

 Subject merchandise may also be provided for in HTS subheadings 7009.92.50 and 9403.90.70.

1

UNITED STATES INTERNATIONAL TRADE COMMISSION

Investigation No. 731-TA-1058 (Preliminary)

WOODEN BEDROOM FURNITURE FROM CHINA

DETERMINATION

On the basis of the record1

 developed in the subject investigation, the United States International

Trade Commission (Commission) determines, pursuant to section 733(a) of the Tariff Act of 1930 (19

U.S.C. § 1673b(a)) (the Act), that there is a reasonable indication that an industry in the United States is

materially injured2

 by reason of imports from China of wooden bedroom furniture, provided for in

subheading 9403.50.90 of the Harmonized Tariff Schedule of the United States (HTS),3

 that are alleged to

be sold in the United States at less than fair value (LTFV).

COMMENCEMENT OF FINAL PHASE INVESTIGATION

Pursuant to section 207.18 of the Commission’s rules, the Commission also gives notice of the

commencement of the final phase of its investigation. The Commission will issue a final phase notice of

scheduling, which will be published in the Federal Register as provided in section 207.21 of the

Commission’s rules, upon notice from the Department of Commerce (Commerce) of an affirmative

preliminary determination in the investigation under section 733(b) of the Act, or, if the preliminary

determination is negative, upon notice of an affirmative final determination in that investigation under

section 735(a) of the Act. Parties that filed entries of appearance in the preliminary phase of the

investigation need not enter a separate appearance for the final phase of the investigation. Industrial

users, and, if the merchandise under investigation is sold at the retail level, representative consumer

organizations have the right to appear as parties in Commission antidumping and countervailing duty

investigations. The Secretary will prepare a public service list containing the names and addresses of all

persons, or their representatives, who are parties to the investigation.

BACKGROUND

On October 31, 2003, a petition was filed with the Commission and Commerce by the American

Furniture Manufacturers Committee For Legal Trade, Washington, DC, and its individual members; 

Cabinet Makers, Millmen, and Industrial Carpenters Local 721, Whittier, CA; UBC Southern Council of

Industrial Workers Local Union 2305, Columbus, MS; United Steel Workers of America Local 193U,

Lewisburg, PA; Carpenters Industrial Union Local 2093, Phoenix, AZ; and Teamsters, Chauffeurs,

Warehousemen and Helpers Local 991, Bay Minette, AL, alleging that an industry in the United States is

materially injured or threatened with material injury by reason of LTFV imports of wooden bedroom

furniture from China. Accordingly, effective October 31, 2003, the Commission instituted antidumping

duty investigation No. 731-TA-1058 (Preliminary).
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

2

Notice of the institution of the Commission’s investigation and of a public conference to be held

in connection therewith was given by posting copies of the notice in the Office of the Secretary, U.S.

International Trade Commission, Washington, DC, and by publishing the notice in the Federal Register

of November 10, 2003 (68 FR 63816). The conference was held in Washington, DC, on November 21,

2003, and all persons who requested the opportunity were permitted to appear in person or by counsel.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 1 Commissioner Pearson finds that there is a reasonable indication that an industry in the United States is

threatened with material injury by reason of imports of wooden bedroom furniture from China that are allegedly sold

in the United States at less than fair value (“LTFV”). See Separate Views of Commissioner Daniel R. Pearson. 

However, Commissioner Pearson agrees with the Commission’s findings with respect to the domestic like product,

the domestic industry and related parties, and conditions of competition, and therefore joins in sections I-V of these

views.

 2

 19 U.S.C. § 1673b(a); see also American Lamb Co. v. United States, 785 F.2d 994, 1001-04 (Fed. Cir. 1986);

Aristech Chemical Corp. v. United States, 20 CIT 353, 354-55 (1996). 

 3

 American Lamb, 785 F.2d at 1001; see also Texas Crushed Stone Co. v. United States, 35 F.3d 1535, 1543

(Fed. Cir. 1994).

 4

 The Committee includes such manufacturers as Bassett Furniture, Century Furniture, L. & J.G. Stickley, Hooker

Furniture, Pennsylvania House, Vaughan-Bassett Furniture, and Vaughan Furniture. 

3

UNITED STATES INTERNATIONAL TRADE COMMISSION

Investigation No. 731-TA-1058 (Preliminary)

WOODEN BEDROOM FURNITURE FROM CHINA

VIEWS OF THE COMMISSION

Based on the record in this investigation, we find that there is a reasonable indication that an

industry in the United States is materially injured by reason of imports of wooden bedroom furniture from

China that are allegedly sold in the United States at less than fair value (“LTFV”).1

I. THE LEGAL STANDARD FOR PRELIMINARY DETERMINATIONS

The legal standard for preliminary antidumping and countervailing duty determinations requires

the Commission to determine, based upon the information available at the time of the preliminary

determinations, whether there is a reasonable indication that a domestic industry is materially injured or

threatened with material injury, or that the establishment of an industry is materially retarded, by reason

of the allegedly unfairly traded imports.2

 In applying this standard, the Commission weighs the evidence

before it and determines whether “(1) the record as a whole contains clear and convincing evidence that

there is no material injury or threat of such injury; and (2) no likelihood exists that contrary evidence will

arise in a final investigation.”3

II. BACKGROUND

Wooden bedroom furniture is wooden furniture that is designed and manufactured for use in the

bedroom. As defined in the scope, wooden bedroom furniture consists of several different types of

furniture, including such items as beds, night stands, chests, armoires, and dressers with mirrors. U.S.

producers and importers of wooden bedroom furniture ship the large majority of their sales to retailers,

and smaller amounts to the hospitality sector and furniture rental firms. 

The petition in this investigation was filed on October 31, 2003. The petitioners include the

American Furniture Manufacturers Committee for Legal Trade, which is an ad hoc association of 27 U.S.

manufacturers of wooden bedroom furniture,4

 as well as the locals of five unions, including the Cabinet

Makers, Millmen, and Industrial Carpenters Local 721; the UBC Southern Council of Industrial Workers
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 5 The petition identified 125 U.S. producers of wooden bedroom furniture.

 6

 Confidential Report (“CR”) at I-4, Public Report (“PR”) at I-3.

 7

 CR and PR at Table C-1.

 8

 CR and PR at VII-1, n. 3.

 9

 CR and PR at VII-4.

 10 CR and PR at IV-4.

 11 CR and PR at IV-4.

 12 The Group includes the furniture retailers The Bombay Company, Crate & Barrel, City Furniture, J.C. Penney,

Haverty Furniture Companies, Rhodes Furniture, Rooms To Go Furniture Corp., Wickes Furniture Inc., and Pier 1

Imports, among others.

 13 The Committee includes the furniture manufacturers and retailers AICO Furniture, Fine Furniture Design &

Marketing, Kemp Furniture, Legacy Classic Furniture, Magnussen Home, Samuel Lawrence Furniture, Schnadig

Furniture, and Universal Furniture International.

 14 Furniture Brands manufactures and sells such furniture brands as Lane, Broyhill, Thomasville, Drexel Heritage,

Henredon, and Maitland Smith.

 15 Several Chinese producers and U.S. importers of wooden bedroom furniture (including Rui Feng Woodwork,

Rui Feng Lumber Development, Naihai Jiantai Woodwork, Yangchun Hangli Furniture Co., Dorbest Ltd., American

Signature Inc., Value City Imports, and Value City Furniture) entered appearances in the proceeding but did not

appear at the conference or file briefs with the Commission

4

Local Union 2305; the United Steel Workers of America Local 193U; the Carpenters Industrial Union

Local 2093; and the Teamsters, Chauffeurs, Warehousemen and Helpers Local 991.

There are numerous producers of wooden bedroom furniture in the United States.5

 The ten

largest U.S. producers accounted for more than 68 percent of reported domestic shipments of wooden

bedroom furniture in 2002.6

 The U.S. wooden bedroom furniture industry held nearly 60 percent of the

wooden bedroom furniture market in 2000 but lost 11.5 percentage points of market share to the subject

imports from China through the end of 2002. It lost an additional 4.6 percentage points of market share

to the subject imports in January-June (“interim”) 2003.7

 

There are a large number of producers of wooden bedroom furniture in China. The petition

identified 133 Chinese producers and exporters of wooden bedroom furniture8

 and the record indicates

that there may be over 300,000 producers of all categories of furniture in China.9

 China was the largest

source of imported wooden bedroom furniture during the period, and shipped more than twice as much

merchandise to the United States, in value terms, in 2002 than Canada, the next largest source of imports.

U.S. producers accounted for a substantial and growing percentage of the subject imports during

the period. U.S. producers imported more than one third of the subject imports from China in 2002.10 

Moreover, U.S. producers’ imports of subject merchandise represented an increasing percentage of their

shipments during the period, growing from a level equivalent to 6.0 percent of their domestically

produced shipments in 2000 to 19.6 percent in 2002.11

Several respondent groups participated in the conference and filed briefs with the Commission,

including the Furniture Retailers Group, an ad hoc association of 35 retailers and importers of wooden

bedroom furniture,12 the Chinese producers Lacquer Craft Manufacturing Co. and Markor International

Furniture (Tianjin) Manufacturing Co., the Committee for Free Trade in Furniture,13 and the largest U.S.

producer of wooden bedroom furniture, Furniture Brands International.14 15 
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 16 19 U.S.C. § 1677(4)(A).

 17 Id.

 18 19 U.S.C. § 1677(10).

 19 See, e.g., NEC Corp. v. Department of Commerce, 36 F. Supp.2d 380, 383 (Ct. Int’l Trade 1998); Nippon Steel

Corp. v. United States, 19 CIT 450, 455 (1995); Torrington Co. v. United States, 747 F. Supp. 744, 749 n.3 (Ct. Int’l

Trade 1990), aff’d, 938 F.2d 1278 (Fed. Cir. 1991) (“every like product determination ‘must be made on the

particular record at issue’ and the ‘unique facts of each case’”). The Commission generally considers a number of

factors including: (1) physical characteristics and uses; (2) interchangeability; (3) channels of distribution;

(4) customer and producer perceptions of the products; (5) common manufacturing facilities, production processes,

and production employees; and, where appropriate, (6) price. See Nippon, 19 CIT at 455 n.4; Timken Co. v. United

States, 913 F. Supp. 580, 584 (Ct. Int’l Trade 1996).

 20 See, e.g., S. Rep. No. 249, 96th Cong., 1st Sess., at 90-91 (1979).

 21 Nippon Steel, 19 CIT at 455; Torrington, 747 F. Supp. at 748-49; see also S. Rep. No. 249 at 90-91 (Congress

has indicated that the domestic like product standard should not be interpreted in “such a narrow fashion as to permit

minor differences in physical characteristics or uses to lead to the conclusion that the product and article are not

‘like’ each other, nor should the definition of ‘like product’ be interpreted in such a fashion as to prevent

consideration of an industry adversely affected by the imports under consideration.”).

 22 Hosiden Corp. v. Advanced Display Mfrs., 85 F.3d 1561, 1568 (Fed. Cir. 1996) (Commission may find a single

domestic like product corresponding to several different classes or kinds defined by Commerce); Torrington,

747 F. Supp. at 748-52 (affirming Commission’s determination of six domestic like products in investigations where

Commerce found five classes or kinds).

5

III. DOMESTIC LIKE PRODUCT

A. In General

To determine whether there is a reasonable indication that an industry in the United States is

materially injured or threatened with material injury by reason of imports of the subject merchandise, the

Commission first defines the “domestic like product” and the “industry.”16 Section 771(4)(A) of the

Tariff Act of 1930, as amended (the Act), defines the relevant domestic industry as the “producers as a

[w]hole of a domestic like product, or those producers whose collective output of a domestic like product

constitutes a major proportion of the total domestic production of the product.”17 In turn, the Act defines

“domestic like product” as “a product which is like, or in the absence of like, most similar in

characteristics and uses with, the article subject to an investigation ... .”18

The decision regarding the appropriate domestic like product(s) in an investigation is a factual

determination, and the Commission has applied the statutory standard of “like” or “most similar in

characteristics and uses” on a case-by-case basis.19 No single factor is dispositive, and the Commission

may consider other factors it deems relevant based on the facts of a particular investigation.20 The

Commission looks for clear dividing lines among possible like products, and disregards minor

variations.21 Although the Commission must accept the determination of the Department of Commerce

(“Commerce”) as to the scope of the imported merchandise allegedly subsidized or sold at LTFV, the

Commission determines what domestic product is like the imported articles Commerce has identified.22

The Commission must base its domestic like product determination on the record in the investigation

before it. The Commission is not bound by prior determinations, even those pertaining to the same
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 23 See Acciai Speciali Terni S.p.A. v. United States, 118 F. Supp.2d 1298, 1304-05 (Ct. Int’l Trade 2000); Nippon

Steel Corp. v. United States, 19 CIT 450, 455 (1995); Asociacion Colombiana de Exportadores de Flores v. United

States, 693 F. Supp. 1165, 1169 n.5 (Ct. Int’l Trade 1988) (particularly addressing like product determination);

Citrosuco Paulista, S.A. v. United States, 704 F. Supp. 1075, 1087-88 (Ct. Int’l Trade 1988).

 24 68 Fed. Reg. 70228 (December 17, 2003).

 25 68 Fed. Reg. 70228 (December 17, 2003).

6

imported products, but may draw upon previous determinations in addressing pertinent like product

issues.23

B. Product Description

In its notice of initiation, Commerce defined the imported merchandise within the scope of these

investigations as “wooden bedroom furniture.” Wooden bedroom furniture is defined in the scope as

being:

generally, but not exclusively, designed, manufactured, and offered for sale in

coordinated groups, or bedrooms, in which all of the individual pieces are of

approximately the same style and approximately the same material and/or finish. The

subject merchandise are made substantially of wood products, including both solid wood

and also engineered wood products made from wood particles, fibers, or other wooden

materials such as plywood, oriented strand board, particle board, and fiberboard; with or

without wood veneers, wood overlays, or laminates; with or without non-wood

components or trim such as metal, marble, leather, glass, plastic, or other resins; and

whether or not assembled, completed, or finished.

The subject merchandise includes (1) wooden beds, such as loft beds, bunk beds, and

other beds; (2) wooden headboards for beds (whether stand alone or attached to side

rails), wooden footboards for beds, wooden side rails for beds, and wooden canopies for

beds; (3) night tables, night stands, dressers, commodes, bureaus, mule chests,

gentlemen’s chests, bachelor’s chests, lingerie chests, wardrobes, vanities, chessers,

chifforobes, and wardrobe-type cabinets; (4) dressers with framed glass mirrors that are

attached to, incorporated in, sit on, or hang over the dresser; (5) chests-on-chests,

highboys, lowboys, chests of drawers, chests, door chests, chiffoniers, hutches, and

armoires; (6) desks, computer stands, filing cabinets, book cases, or writing tables that

are attached to or incorporated in the subject merchandise; and (7) other bedroom

furniture consistent with the above list.24

Commerce excluded from the scope a number of categories of furniture that might otherwise be

used in a bedroom, such as seats, chairs, benches, couches, sofas, sofa beds, stools and other seating

furniture; mattresses, mattress supports (including box springs), infant cribs, water beds, and futon

frames; office furniture, such as desks, stand-up desks, computer cabinets, filing cabinets, credenzas, and

bookcases; dining room or kitchen furniture, such as dining tables, chairs, servers, sideboards, buffets,

corner cabinets, china cabinets, and china hutches; and other non-bedroom furniture, such as television

cabinets, cocktail tables, end tables, occasional tables, wall systems, book cases, and entertainment

systems.25
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 26 68 Fed. Reg. 70228 (December 17, 2003). As used in the scope, the term “bentwood” means solid wood made

pliable. It is wood that is brought to a curved shape by bending it while made pliable with moist heat or other

agency and then set by cooling or drying. Id.

 27 68 Fed. Reg. 70228 (December 17, 2003).

 28 CR at I-10, PR at I-7.

 29 Petition at 16-24; Petitioners’ Postconference Brief at Ex. 1, pp. 2-18.

 30 Petition at 16; Petitioners’ Postconference Brief at Ex. 1, pp. 3-4.

 31 Petition at 20; Petitioners’ Postconference Brief at Ex. 1, pp.6.

 32 Petition at 20; Petitioners’ Postconference Brief at Ex. 1, p. 5.

 33 Petition at 22; Petitioners’ Postconference Brief at Ex. 1, p. 6.

 34 Petition at 23-24; Petitioners’ Postconference Brief at Ex. 1, p. 7.

7

Commerce also excluded from the scope of the investigation any bedroom furniture that is “made

primarily of wicker, cane, osier, bamboo or rattan,” or “in which bentwood parts predominate.” 26 

Moreover, Commerce excluded from the scope side rails for beds that are made of metal if the rails are

sold separately from the head and footboard.27

Wooden bedroom furniture includes furniture that is made of wood or wood products and is

designed and manufactured for use in the bedroom. As defined in the scope, wooden bedroom furniture

consists of a number of different individual items of furniture, including such items as beds, night stands,

chests of drawers, armoires, and dressers with mirrors. Each of these items has somewhat different

physical characteristics, configurations, and uses, but all share the same physical characteristic of being

produced of wood or wood products and of being intended for use in a bedroom. Wooden bedroom

furniture is used primarily in residences and lodging, and care facilities, such as assisted living facilities.28

C. Positions of the Parties

Petitioners. The petitioners argue that the Commission should find one domestic like product

consisting of all wooden bedroom furniture as that term is defined in the scope of the investigation.29 

Petitioners argue that all bedroom furniture – whether beds, night stands, dressers, or chests of drawers –

are designed, manufactured, distributed, marketed, displayed and sold in integrated units of furniture

known as a “suites” in the industry.30 Petitioners assert that, while an individual retail consumer of

bedroom furniture may choose to purchase individual items of bedroom furniture separately, the furniture

retailers who purchase these products from the producers generally purchase and market these pieces as

suites. As a result, petitioners contend that the Commission should assess the interchangability of these

products from the perspective of the furniture retailer who purchases these products, that is, as bedroom

suites, rather than at the level of the ultimate consumer.31 

As for the other domestic like product factors, petitioners assert that all wooden bedroom

furniture share the same general physical characteristics because they are made of wood or wood products

and have characteristics and uses dictated by their use in the bedroom.32 In addition, petitioners contend

that all wooden bedroom furniture is distributed in the same channels of distribution, which consists

primarily of sales to retailers,33 and that wooden bedroom furniture is produced and manufactured in the

same facilities and using the same basic production facilities and employees.34
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 35 Lacquer Craft Postconference Brief at pp. 7-12.

 36 Lacquer Craft Postconference Brief, at p. 7.

 37 Lacquer Craft Postconference Brief at pp. 7-8.

 38 Lacquer Craft Postconference Brief at pp. 7-8. Respondents did not indicate any alternative definitions of the

domestic like product for the Commission to explore in any final phase of this investigation. In order to ensure that

we collect the data necessary for consideration of any alternative domestic like products proposed by respondents,

respondents should identify viable potential alternative domestic like product definitions and any related data

collection issues when they submit their comments on draft questionnaires pursuant to 19 C.F.R. § 207.20(b). See,

e.g., 61 Fed. Reg. 3718, 37826 (July 29, 1996); Polyvinyl Alcohol from China and Korea, Inv. Nos. 731-TA-1014

and 1017 (Final), USITC Pub. 3634 (September 2003) at 18, n. 99.

 39 CR at I-9, PR at I-7.

 40 Petition at pp. 20-22.

 41 Wood bedroom suites also can be referred to as bedroom collections, bedroom groups, or bedrooms.

8

Respondents. Respondents agree with petitioners that, for purposes of this preliminary

investigation, the Commission should perform its analysis on the basis of one domestic like product,

consisting of all wooden bedroom furniture as defined in the scope of investigation.35 However,

Respondents Lacquer Craft Manufacturing, Markor International, and the Committee for Free Trade in

Furniture have stated that they “want to reserve [their] position” on this issue should the investigation

proceed to a final phase.36 According to the Lacquer Craft Group, it may be inappropriate to treat all of

the items covered by the scope as one like product because they have different physical characteristics

and end uses,37 and because they are not always designed, manufactured and sold as bedroom suites, as

petitioners contend.38

D. Analysis

For the reasons discussed below, we find that there is one domestic like product in this

preliminary investigation, consisting of all wooden bedroom furniture, as that term is defined in the scope

of this investigation. 

Physical Characteristics and End Uses. On a broad level, the individual items of furniture that

comprise wooden bedroom furniture can be said to share the same general physical characteristics and

end uses. All of these items, whether beds, night stands, chests of drawers, or dressers, are made of wood

or wood products and are specifically designed and manufactured for the purpose of being used in the

bedroom.39 Because of their intended use in the bedroom, the products are designed specifically for

functions required in a bedroom, such as the storage of clothes and other personal items and providing a

place to change clothes and to sleep.40 Finally, the record of this investigation shows that, because

wooden bedroom furniture generally is designed, manufactured, and offered for sale in coordinated

groups called bedroom “suites,” all of the individual pieces in the suite will share the same basic design,

raw materials, construction, and finish.41 Given this, the items of furniture included in the wooden

bedroom furniture grouping share some broad characteristics and end uses.

However, the individual items of furniture making up the wooden bedroom furniture category

also differ with respect to certain physical characteristics and end uses. For example, night stands and

dressers do not share the same physical structure as beds, nor do they share the same structure and design

with each other, because each article is designed specifically for a different end use. For example, beds

generally are designed to hold mattresses and to provide individuals with a place to sleep, night stands

generally are designed to hold lamps and other small personal articles used in bed, and chests of drawers
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 42 See CR and PR at I-13; Petitioners Postconference brief at pp. 5-6.

 43 See, e.g., CR at I-10, PR at I-7; Tr. at 37-39 (testimony of Mr. Bassett), 59 (testimony of Mr. Hewitt). See also

generally Tr. at 149-183 (testimony of retailer witnesses consistently referencing “bedrooms” and “bedroom suites”

as an entity).

 44 However, we note that the record shows that wooden bedroom furniture is not exclusively produced, sold and

marketed as bedroom “suites.” For example, the record indicates that domestic producers and importers routinely

price their wooden bedroom furniture on an individual item basis when shipping and selling their merchandise. See,

e.g., CR at V-16 & n. 38, PR at V-10-11 & n. 38; Tr. at 84-86 (testimony of Mr. W. Bassett). Similarly, witness

testimony at the staff conference indicated that wooden bedroom furniture is not always stocked in inventory at the

retailer level but that it may be produced to order at the request of retail consumers. Tr. at 228 (testimony of Mr.

Chipperfield). This indicates that producers may actually produce and ship items of wooden bedroom furniture on

an individual item basis, to the extent that the retail consumer orders such an item from the retailer. We intend to

examine this issue further in any final phase of this investigation.

 45 CR at I-13, PR at I-9.

 46 Petitioners’ Postconference Brief at p. 15.

 47 See, e.g., Certain Carbon Flat-Rolled Carbon Steel Products from Argentina et al., Inv. Nos. 701-TA-319-332,

334, 336–342, 344, and 347-53 & 731-TA-573-579, 581-592, 594-597, 599-609, and 612-619 (Final), USITC Pub.

2664 (Aug. 1993). 

9

and dressers generally are designed to hold clothes.42 Thus, at a more item-specific level, the individual

items of furniture within the bedroom furniture grouping do not share all of the physical characteristics

and end uses with the other items of furniture within the grouping. 

However, the record in this preliminary investigation does generally support petitioners’

contention that the individual items within the wooden bedroom grouping generally are designed,

manufactured and sold to retailers as bedroom “suites.”43 Consistent with Commission practice, we find

that it is most appropriate to consider whether wooden bedroom furniture shares the same physical

characteristics and end uses from the perspective of the entity that first purchases these products, i.e., the

retailer. The furniture retailer is interested primarily in these products as “suites” and the furniture

retailer purchases and markets them as such. Thus, from the perspective of the furniture retailer, the

products being sold are the bedroom suites as such and the differences in physical characteristics and end

uses between the individual items comprising the suites are not as relevant as they would be to the end

user.44

 Interchangeability. The record of this investigation indicates that wooden bedroom furniture is

generally not interchangeable with other types of furniture used in residences, such as dining room

furniture, living room furniture, and office furniture.45 However, as indicated above, the various items of

wooden bedroom furniture are also not fully interchangeable with one another because they are used for

different purposes within the bedroom.46 Nonetheless, the Commission routinely has grouped together

products within a domestic like product continuum that are not interchangeable with one another for

specific end uses.47 Moreover, from the perspective of the furniture retailer, no individual item of

wooden bedroom furniture can be considered interchangeable with a suite of bedroom furniture, given

that producers generally design and manufacture, and retailers purchase and market, wooden bedroom

furniture as entire bedroom suites.

Channels of Distribution. The record of this preliminary investigation shows that most wooden

bedroom furniture is sold to furniture retailers, with a small percentage being sold to purchasers in the
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 48 CR at I-14 & II-1, PR at I-10 & II-1. In interim 2003, approximately 92.0 percent of U.S. shipments of

domestic and imported merchandise was sold to retailers, while 3.6 percent was sold to the hospitality sector and 2.1

percent was sold to furniture rental firms. CR at II-1-2, PR at II-1.

 49 See CR at I-10-11, PR at I-8-9.

 50 Tr. at 72 (testimony of Mr. W. Bassett). The witness added that he was “not aware of anyone that has a bed

plant, a separate dresser plant, a separate mirror plant, a separate armoire plant, [or] a separate night stand plant.” Id.

 51 Tr. at 72 (testimony of Mr. W. Bassett).

 52 Tr. at 77 (testimony of Mr. W. Bassett).

 53 Tr. at pp. 37-39 & 83 (testimony of Mr. W. Bassett), 86-87 (testimony of Mr. Loring) & 87 (testimony of Mr.

Kincaid).

 54 See, e.g., Tr. at 150-158 & 178-82 (testimony of Mr. Seaman), 158, 160 (testimony of Mr. McAlister), 166

(testimony of Mr. Kemp), & 167-177 (testimony of Mr. Chipperfield) (all appearing to assume that bedrooms and

bedroom suites are the basis of competition in the market).

 55 CR and PR at Table V-1 & Tr. at 171-182 & 221 (testimony of Mr. Seaman).

10

hospitality sector (i.e., hotels, motels, and nursing homes) and the furniture rental firms.48 All of the

individual items of wooden bedroom furniture are sold in these same channels of distribution. Given

this, the record indicates that all wooden bedroom furniture is sold in the same channels of trade.

Common manufacturing facilities, production processes, and production employees. The record

indicates that all wooden bedroom furniture is produced in the same manufacturing facilities, using the

same production processes and production employees.49 For example, one witness testified that domestic

producers of wooden bedroom furniture generally produce all of their wooden bedroom furniture in the

same facilities and using the same employees.50 Moreover, this witness testified that the individual items

of wooden bedroom furniture are sourced from the same lumber yard, and all run through the same roughin lines, machine room, sanding room, and finishing lines in a producer’s plant, so that all employees in

the plant work on the individual items of bedroom furniture.51 Finally, the same witness asserted that, for

most domestic producers, wooden bedroom furniture comprises the “vast majority” of their furniture

production at these facilities.52

Customer and Producer Perceptions. The limited record evidence, including witness testimony,

in this preliminary investigation suggests that producers, importers, and purchasers generally perceive all

wooden bedroom furniture to be a single product category. For example, witnesses for the petitioners

testified that all items of wooden bedroom furniture generally are designed, produced and marketed in the

form of bedroom suites, rather than as individual items of bedroom furniture.53 The producers, importers,

and retailers who testified on behalf of respondents uniformly gave testimony that was consistent with the

notion that these products are sold in bedroom suite groupings or suites.54 Price. The record

indicates that there is a very substantial variation and range in the prices of the individual items of

furniture that make up wooden bedroom furniture. Because the overall price of bedroom suites can vary

from as low as $200-$600 per suite to an upper price of $8,500,55 the price of a night stand in a more

expensive bedroom suite may be substantially higher than that of a bed contained in an inexpensive suite. 

Given this, the record indicates that there is some overlap in the price ranges of the individual items in the

suites within the market.

Conclusion. The record indicates that there is a broad similarity of physical characteristics and

end uses for all wooden bedroom furniture, that all forms of wooden bedroom furniture are produced in

common manufacturing facilities using the same production employees and production processes, and

that all wooden bedroom furniture is sold in similar channels of trade. Moreover, the limited record
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 56 19 U.S.C. § 1677(4)(A).

 57 See United States Steel Group v. United States, 873 F. Supp. 673, 681-84 (Ct. Int’l Trade 1994), aff’d, 96 F.3d

1352 (Fed. Cir. 1996).

 58 19 U.S.C. § 1677(4)(B).

 59 Sandvik AB v. United States, 721 F. Supp. 1322, 1331-32 (Ct. Int’l Trade 1989), aff’d without opinion, 904

F.2d 46 (Fed. Cir. 1990); Empire Plow Co. v. United States, 675 F. Supp. 1348, 1352 (Ct. Int’l Trade 1987). The

primary factors the Commission has examined in deciding whether appropriate circumstances exist to exclude the

related parties include: (1) the percentage of domestic production attributable to the importing producer; (2) the

reason the U.S. producer has decided to import the product subject to investigation, i.e., whether the firm benefits

from the LTFV sales or subsidies or whether the firm must import in order to enable it to continue production and

compete in the U.S. market; and (3) the position of the related producers vis-a-vis the rest of the industry, i.e.,

whether inclusion or exclusion of the related party will skew the data for the rest of the industry. See, e.g.,

Torrington Co. v. United States, 790 F. Supp. 1161, 1168 (Ct. Int’l Trade 1992), aff’d without opinion, 991 F.2d 809

(Fed. Cir. 1993). The Commission has also considered the ratio of import shipments to U.S. production for related

producers and whether the primary interests of the related producers lie in domestic production or in importation. 

See, e.g., Melamine Institutional Dinnerware from China, Indonesia, and Taiwan, Inv. Nos. 731-TA-741-743 (Final),

USITC Pub. 3016 (Feb. 1997) at 14 n.81.

11

evidence suggests that industry participants consider all wooden bedroom furniture to be part of one

category of bedroom products that are produced, sold and marketed as a coordinated group, i.e., as

bedroom suites. Finally, the record suggests that there is some overlap of pricing between the various

items of wooden bedroom furniture.

Accordingly, for purposes of this preliminary investigation, we find that there is one domestic

like product in this preliminary investigation, consisting of wooden bedroom furniture, as that term is

defined in the scope of investigation. 

IV. DOMESTIC INDUSTRY

A. General

The domestic industry is defined as the “producers as a [w]hole of a domestic like product, or

those producers whose collective output of a domestic like product constitutes a major proportion of the

total domestic production of the product.”56 In defining the domestic industry, the Commission’s general

practice has been to include in the industry all domestic production of the domestic like product, whether

toll-produced, captively consumed, or sold in the domestic merchant market.57

In defining the domestic industry, we must determine whether any producer of the domestic like

product should be excluded from the domestic industry pursuant to section 771(4)(B) of the Act. That

provision of the statute allows the Commission, if appropriate circumstances exist, to exclude from the

domestic industry producers that are related to an exporter or importer of subject merchandise or which

are themselves importers.58 Exclusion of such a producer is within the Commission’s discretion based

upon the facts presented in each case.59

In this investigation, the record indicates that 20 of the 40 responding domestic producers of

wooden bedroom furniture imported wooden bedroom furniture from China during the period of

investigation, including 14 of the petitioning firms and all ten of the largest domestic producers of
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 60 For purposes of performing our related party analysis, we have relied on the value, rather than quantity, of the

producers’ total shipments. As noted in the staff report, CR and PR at III-3, many of the responding domestic

producers were unable to report the quantity of their production in the form requested by the staff. As a result, the

production data reported consist of data reported by a much smaller number of producers than do the shipment data. 

Because exports accounted for less than 1.5 percent of the industry’s total shipments in 2002, and because inventory

levels remained stable during the period, we find that the shipment levels reported by the individual producers

provide a reasonable indication of the relative size of the individual producers’ production operations during the

period. 

 61 Petitioners’ Postconference Brief at Ex. 1, pp. 20-23.

 62 Petitioners’ Postconference Brief at Ex. 1, pp. 20-23. 

 63 Petitioners’ Postconference Brief at Ex. 1, pp. 20-23. Petitioners contend, however, that no other domestic

producer should be excluded as a related party from the industry because they are importing only in order to remain

competitive in the marketplace and would prefer to produce wooden bedroom furniture domestically, they are not

benefitting disproportionately from their imports of subject merchandise, and they are importing comparatively

smaller amounts of merchandise from China than *** and ***. Petitioners’ Postconference Brief at Ex. 1, pp. 24-25.

 64 Lacquer Craft Postconference Brief at pp. 12-14; Furniture Retailers Group Postconference Brief at p. 2, n.2.

 65 Lacquer Craft Postconference Brief at pp. 12-14.

 66 CR and PR at Tables III-1 & IV-2.

12

wooden bedroom furniture in 2002.60 Accordingly, we have considered whether appropriate

circumstances exist to exclude any of these companies from the industry as a related party.

B. Arguments of the Parties

Petitioners contend that appropriate circumstances exist to exclude only two U.S. producers of

wooden bedroom furniture -- *** -- from the domestic industry as related parties.61 Petitioners assert that

these two producers should be excluded from the industry because both oppose the petition and both

companies have made subject wooden bedroom furniture imports a significant and increasing percentage

of their total shipments of bedroom furniture during the period of investigation.62 Petitioners also argue

that both companies import in order to benefit from dumped imports rather than as a defensive measure

allowing them to continue competing in the market, and that both companies’ operating results “deviated

substantially” from the performance of the industry as a whole during the period.63 

Respondents contend that no domestic producers of wooden bedroom furniture should be

excluded from the industry as related parties simply because they imported subject merchandise.64 They

assert that all importing domestic producers (both those who support the petition and those who do not)

have adopted a “blended production” strategy of importing merchandise from China in order to compete

effectively and to continue to produce merchandise in the United States market.65 

C. Analysis 

We do not find appropriate circumstances exist to exclude from the industry any domestic

producer that imported domestic merchandise during the period. As an initial matter, we note that the

record indicates it has become common practice for members of the domestic industry to import the

subject merchandise from China as a means of supplementing their domestic production in the market

place.66 For example, the record shows that 20 of the 40 responding domestic producers imported

Chinese merchandise during the period and that the 12 largest domestic producers of wooden bedroom

furniture all imported reasonably substantial and increasing volumes of merchandise from China during
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 67 See CR and PR at Tables III-1 & IV-2. 

 68 See CR and PR at Tables III-1 & IV-2. 

 69 CR and PR at Table IV-2.

 70 CR and PR at Table IV-2.

 71 The ratio of ***’s imports of subject merchandise to its domestically produced shipments was *** percent in

2002 and *** percent in interim 2003, while the ratio of ***’s imports of subject merchandise to shipments of its

domestic merchandise was *** percent in 2002 and *** percent in interim 2003. CR and PR at Table IV-2.

 72 CR and PR at Table C-1.

 73 CR and PR at Table C-1.

 74 CR and PR at Table III-1. Moreover, both firms’ operating margins did not vary significantly from those of

other similarly sized domestic producers, whether those firms imported Chinese product or not. 

 75 CR and PR at Table III-1.

 76 *** Domestic Producers’ Questionnaire Response at question 23a.

13

the period of investigation. 67 In fact, the *** companies within the petitioning group all have imported

increasing volumes of subject merchandise from China during the period of investigation.68 

Focusing more specifically on *** and ***, at no point during the period of investigation did ***

or *** import more merchandise (in terms of value) than it shipped of its own domestically produced

merchandise. For example, during the period of investigation, ***’s importations of subject merchandise

in any individual year never equaled more than *** percent of its total shipments of its domestically

produced merchandise.69 Similarly, at no point in the period did ***’s importations of subject

merchandise equal more than *** percent of its total shipments of domestically produced merchandise.70 

Given that *** members of the petitioning group, *** and ***, both had comparable -- and even higher --

ratios of subject imports volumes to their total domestic shipments in 2002 and 2003,71 it would appear

that *** and *** practices in this regard would not justify excluding them from the industry.

Moreover, the record does not indicate that *** or *** benefitted disproportionately from their

importations of subject merchandise when compared with the rest of the industry. ***’s operating

margins ranged from *** percent in 2000 to *** percent in ***, which was not disproportionately higher

than the industry’s average operating margins during those years, which ranged from 10.3 percent in 2000

to 7.8 percent in 2002.72 ***’s operating margins ranged from *** percent in 2000 to *** percent in

2002.73 Given the foregoing, it is not clear that either firm benefitted significantly from its imports of

subject merchandise or that inclusion of their data would significantly skew the industry data, particularly

when viewed in light of the fact that *** accounted for only *** percent of domestic shipments in 2002

and *** accounted for only *** percent of domestic shipments in that year.74 

Finally, although both *** and *** opposed the petition and were both among the *** largest

U.S. producers of wooden bedroom furniture, the record indicates that both *** and *** have reported

that they are importing subject merchandise from China not to supplant or displace their domestic

production but to supplement their existing domestic product lines. For example, ***, which was the ***

reporting shipper of domestic merchandise in 2002,75 stated that *** and utilizes its domestic factories to:

***76
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 77 CR and PR at Table III-1.

 78 *** Domestic Producers’ Questionnaire Response at question 23a.

 79 No party has recommended excluding any other producer from the industry as a related party.

 80 See CR at Tables III-1 & IV-2. 

 81 We find that the captive production provision does not apply because the record indicates that domestic

producers did not internally transfer significant production of the domestic product for the production of a

downstream product, as required by the provision. 19 U.S.C. 1677(7)(C)(iv). The record in the preliminary phase

of this investigation indicates that the domestic industry internally consumed or transferred to related companies less

than *** percent of its total shipments during any year of the period of investigation. CR and PR at Table III-3. 

 82 CR at II-17, PR at II-11-12.

 83 CR at II-19, PR at II-12-13.

 84 CR at II-19, PR at II-13.

14

Similarly, ***, which was the *** reporting shipper of domestic merchandise in 2002,77 stated

that it ***78 In other words, both companies report that they are importing to enable them to continue

production of their existing lines in the United States. 

In view of the foregoing, we do not find that appropriate circumstances exist to exclude *** or

*** from the industry. We also have considered whether any other domestic producer should be

excluded from the industry.79 Our review of the record does not indicate that any other importing

producer’s operations or financial results would warrant excluding them from the industry.80 For

purposes of our preliminary determination, therefore, we do not find that appropriate circumstances exist

to exclude any domestic industry as a related party.

Accordingly, we define the domestic industry to include all U.S. producers of wooden bedroom

furniture.

V. CONDITIONS OF COMPETITION81

Several conditions of competition are pertinent to our analysis in the preliminary phase of this

investigation.

A. Demand Conditions

Demand for wooden bedroom furniture is affected primarily by the overall condition of the U.S.

economy, the level of activity in the new housing market, and the level of home mortgage interest rates.82 

As measured by the growth in real gross domestic product, the overall economy grew slowly between

January 2000 and June 2003, and actually contracted during the first three quarters of 2001.83 However,

new housing starts remained at historically high levels during the period of investigation, growing

consistently throughout the period, while home mortgage rates fell throughout the period, reaching an

average of 6.5 percent in 2002 and 5.7 percent in 2003.84 
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 85 We note that, to a great extent, we have used value to perform our volume-based analyses primarily because

quantity-based volume data are not available or were not provided for a number of the criteria we consider in our

analysis, such as import data. The parties agree that value data are best for assessing such issues as apparent

consumption and import and domestic market share. See Tr. at 201-202 (testimony of Mr. Greenwald). However,

we also recognize that the use of value data for market share calculations may understate actual import volume to the

extent it reflects LTFV sales of wooden bedroom furniture. 

 86 CR and PR at Table IV-3.

 87 CR and PR at Table IV-3.

 88 CR and PR at Table IV-3.

 89 CR at II-20-23, PR at II-14-15. 

 90 Lacquer Craft Postconference Brief at pp. 5, 15 & 21-22; Furniture Brands Postconference Brief at p. 3-4.

 91 Lacquer Craft Postconference Brief at p. 5.

 92 Petitioners Postconference Brief at pp. 20-22.

 93 Hospitality sector firms include hotels, motels, retirement homes, and assisted care facilities.

 94 CR and PR at II-1-4.

 95 CR and PR at II-1.

 96 CR and PR at I-10. One furniture retailer testified at the staff conference that the vast majority of retail

consumers, “more than 90 percent,” buy wooden bedroom furniture in suites. Tr. at 59.

 97 At a minimum, a bedroom suite includes a bed frame, chest of drawers, and a night stand. A bedroom suite

also may include additional items such as an armoire, a dresser with a mirror, and more than one night stand.

 98 CR and PR at I-10.

15

Apparent U.S. consumption of wooden bedroom furniture fluctuated somewhat during the period

of investigation, but grew overall between the beginning and end of the period. Measured by value,85

apparent U.S. consumption fell slightly from $4.2 billion in 2000 to $4.1 billion in 2001.86 It then

increased to $4.4 billion in 2002.87 Apparent U.S. consumption was slightly higher in interim 2003

($2.25 billion) than in interim 2002 ($2.17 billion).88

Demand for wooden bedroom furniture is at least moderately elastic, primarily due to the

discretionary nature of the consumer’s purchase decision with respect to wooden bedroom furniture.89 

The parties disagree about the extent to which demand for wooden bedroom furniture is elastic, however. 

Respondents assert that demand is highly elastic,90 and that the presence of lower-priced imports from

China in the market has expanded demand for wooden bedroom furniture in the market.91 Petitioners

assert that respondents have significantly overstated the level of its demand elasticity.92 We will examine

these contentions further in any final phase of this investigation. 

The large majority of wooden bedroom furniture is sold by producers and importers to furniture

retailers in the U.S. market, with smaller amounts being sold to “hospitality” sector firms93 and furniture

rental firms.94 Approximately 92 percent of all shipments of domestic and imported wooden bedroom

furniture during the period of investigation were sold to furniture retailers while 3.6 percent were sold to

the hospitality sector, and 2.1 percent to furniture rental firms.95

The record indicates that wooden bedroom furniture is generally, but not exclusively, designed,

manufactured, and offered for sale in coordinated groups, commonly called bedroom “suites.”96 

Bedroom suites can include several different items of furniture,97 but all of the pieces in a suite share the

same basic design, raw materials, construction, and finish.98 Respondents contend that a substantial
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 99 Lacquer Craft Postconference Brief at p. 8.

 100 CR at II-5, PR at II-3.

 101 CR at II-5, PR at II-3.

 102 CR at I-11 & V-2-5, PR at I-8 & V-1-3.

 103 CR and PR at V-2.

 104 CR and PR at V-2; see also CR and PR at Table V-1 (showing significant differences in perception of pricing

ranges for these three segments).

 105 CR and PR at Table II-1.

 106 CR at II-29-30 & Table II-2, PR at II-19-20 & Table II-2.

 107 Commissioner Pearson notes that the economic consultant for the respondents asserted that the price elasticity

of substitution between the domestic and imported Chinese wooden bedroom furniture likely ranges from 3 to 6,

suggesting a relatively high degree of substitutability between the domestic and imported subject products. CR at II28, n. 68; PR at II-II-18, n. 68.

16

amount of wooden bedroom furniture is sold as individual pieces of furniture, rather than on a suite basis,

both at the retailer and retail consumer level.99

U.S. furniture retailers generally display wooden bedroom furniture in designated retail areas,

called “slots,” on their display floor.100 Domestic producers and importers both universally agree that

access to these display slots is a critical component in selling their furniture through the retailer to the

retail customer.101 As a result, the gain or loss of “slots” at any retailer can affect the overall volume of

merchandise shipped by a producer or an importer.

The market for wooden bedroom furniture can be divided generally into three quality or pricing

levels: a low-priced segment (often called the “good” category of bedroom furniture), a medium-priced

segment (often called the “better” category of bedroom furniture), and a high-end segment (often called

the “best” category of bedroom furniture).102 The record indicates that the quality or pricing category of

a particular bedroom furniture suite is determined by the quality of its materials, its fit and finish, and the

size and scale of the furniture.103 Although most market participants agree that the market is comprised

of furniture within these three quality segments, there is no consistent definition within the industry of the

furniture quality or pricing that characterizes each segment.104

B. Substitutability

The record indicates that there is a moderate to high degree of substitutability between domestic

wooden bedroom furniture and the subject imports. The large majority of domestic producers and

importers agree that the domestic merchandise and the subject imports are always or frequently

interchangeable for one another.105 Moreover, the record indicates that price is a significant factor in the

purchase decision for wooden bedroom furniture, with the large majority of domestic producers and a

substantial minority of importers reporting that non-price factors are only sometimes or never a

significant factor in the purchase decision.106 107
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 108 Petition at Exs. 1 & 2.

 109 CR at I-4, PR at I-3.

 110 CR and PR at Tables III-2 & C-1.

 111 CR and PR at IV-4.

 112 Petitioners Postconference Brief at p. 3 & 25-26.

 113 Lacquer Craft Postconference Brief at p. 2. They also argue that many retailers have resorted to importing

from China because the Chinese producers – unlike the domestic producers – are willing to produce “private label”

brands for the furniture retailers.

 114 CR and PR at VII-1, n. 3.

 115 CR and PR at VII-4.

 116 The Chinese industry’s data are based on the questionnaire responses of 59 firms estimated to account for 57

percent of total Chinese exports of wooden bedroom furniture to the United States in 2002. CR and PR at VII-1.

 117 CR and PR at Table VII-1.

 118 CR and PR at Table VII-1. While the data indicate that the Chinese producers have limited excess capacity,

CR at II-16, PR at II-10, they have expanded production by expanding capacity. 

17

C. Supply

There are a large number of U.S. producers of wooden bedroom furniture in the United States. 

The petition identified approximately 125 producers of wooden bedroom furniture in the United States.108

However, the ten largest reporting domestic producers accounted for more than 68 percent of reported

domestic shipments of wooden bedroom furniture in 2002.109 The industry’s capacity fell by 3.8 percent

between 2000 and 2002, and its production fell by 10.3 percent during the same period.110

The record indicates that U.S. producers accounted for a substantial and growing percentage of

the subject imports during the period. Imports of subject bedroom furniture by the domestic producers

increased from a level equivalent to 6.0 percent of their domestically produced shipments in 2000 to a

level equivalent to 19.6 percent of those shipments in 2002.111 Petitioners assert that the industry must

import the subject merchandise in order to compete with imports priced below the industry’s raw

materials costs.112 Respondents, however, assert that the industry has begun importing this merchandise

as a means of supplementing their domestic production lines with furniture that is more efficiently and

cost-effectively produced in China.113 

There are also a large number of producers of wooden bedroom furniture in China. The petition

identified 133 Chinese producers and exporters of wooden bedroom furniture114 and the record indicates

that there may be over 300,000 producers of all categories of furniture in China.115 China was the largest

source of imported wooden bedroom furniture during the period of investigation, and shipped more than

twice as much merchandise to the United States, in terms of value, in 2002 than Canada, the next largest

supplier.

The reported capacity of the Chinese wooden bedroom furniture industry has exhibited

tremendous growth during the period, with the capacity of the reporting Chinese producers116 more than

doubling during the period of investigation, growing from 1.8 million pieces in 2000 to 4.5 million pieces

in 2002.117 Their reported capacity grew by an additional 32 percent between interim periods.118 The
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 119 CR and PR at Table VII-1.

 120 CR and PR at Table IV-3. 

 121 CR and PR at Table IV-3.

 122 CR and PR at Table IV-3.

 123 19 U.S.C. § 1677(24)(A)(I)(I). In this investigation, the subject imports of wooden bedroom furniture from

China accounted for substantially more than three percent of the volume of all wooden bedroom furniture imported

into the United States in the most recent 12-month period for which data are available preceding the filing of the

petition. See CR and PR at Table IV-1. Accordingly, we find that subject imports from China are not negligible

under 19 U.S. C. § 1677(24).

 124 19 U.S.C. §§ 1671b(a) and 1673b(a).

 125 19 U.S.C. § 1677(7)(B)( i). The Commission “may consider such other economic factors as are relevant to the

determination” but shall “identify each [such] factor . . . [a]nd explain in full its relevance to the determination.” 19

U.S.C. § 1677(7)(B). See also Angus Chemical Co. v. United States, 140 F.3d 1478 (Fed. Cir. 1998).

 126 19 U.S.C. § 1677(7)(A).

 127 19 U.S.C. § 1677(7)(C)(iii).

 128 19 U.S.C. § 1677(7)(C)(iii).

18

reporting Chinese producers project that their capacity will grow by an additional 1.4 million pieces in

full year 2003, and by a further 747,000 pieces in 2004.119

Finally, imports from non-subject countries have maintained a substantial but stable presence in

the U.S. market.120 By value, the market share of non-subject imports was 29.9 percent in 2000, 31.2

percent in 2001, 30.8 percent in 2002, and 29.5 percent in interim 2003.121 Canada, Italy and Indonesia

were the three largest non-subject suppliers of wooden bedroom furniture in 2002.122

VI. REASONABLE INDICATION OF MATERIAL INJURY BY REASON OF ALLEGEDLY

LESS THAN FAIR VALUE IMPORTS123

In the preliminary phase of antidumping or countervailing duty investigations, the Commission

determines whether there is a reasonable indication that an industry in the United States is materially

injured by reason of the imports under investigation.124 In making this determination, the Commission

must consider the volume of subject imports, their effect on prices for the domestic like product, and their

impact on domestic producers of the domestic like product, but only in the context of U.S. production

operations.125 The statute defines “material injury” as “harm which is not inconsequential, immaterial, or

unimportant.”126 In assessing whether there is a reasonable indication that the domestic industry is

materially injured by reason of subject imports, we consider all relevant economic factors that bear on the

state of the industry in the United States.127 No single factor is dispositive, and all relevant factors are

considered “within the context of the business cycle and conditions of competition that are distinctive to

the affected industry.”128

Based on an evaluation of the relevant statutory factors, we find that there is a reasonable

indication that the domestic industry producing wooden bedroom furniture is materially injured by reason

of the subject imports from China.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 129 19 U.S.C. § 1677(7)(C)(i).

 130 CR and PR at Table IV-1 & Table C-1. As noted earlier, we have used value to perform our volume-based

analyses primarily because quantity-based volume data are not available or were not provided for such criteria as

import data. However, we recognize that the use of value data for market share calculations may understate actual

import volume to the extent it reflects LTFV sales of wooden bedroom furniture. 

 131 CR and PR at Table IV-1 & Table C-1. 

 132 CR and PR at Table IV-3. 

 133 CR and PR at Table IV-3. 

 134 As we noted previously, the market share of the non-subject imports remained essentially stable during the

period of investigation, ranging between 29.5 percent and 31.2 percent throughout the period. CR and PR at Tables

IV-3 & C-1.

 135 19 U.S.C. § 1677(7)(C)(ii).

 136 CR and PR at Table II-1.

19

A. Volume of Subject Imports

Section 771(7)(C)(i) of the Act provides that the “Commission shall consider whether the volume

of imports of the merchandise, or any increase in that volume, either in absolute terms or relative to

production or consumption in the United States, is significant.”129

The volume of the subject imports increased significantly over the period examined, both in

absolute terms and relative to consumption in the United States. In value terms, the volume of the subject

imports increased by 121.4 percent between 2000 and 2002, growing from $433 million in 2000 to $566

million in 2001 and $958 million in 2002.130 The volume of subject imports also increased by 54.3

percent between interim periods, growing from $405 million in interim 2002 to $625 million in interim

2003.131 The market share of the subject imports rose steadily over the period as well, growing from

10.3 percent in 2000 to 14.0 percent in 2001 and to 21.8 percent in 2002.132 Subject imports’ market

share grew between interim periods as well, from 18.6 percent in interim 2002 to 27.8 percent in interim

2003.133 

For purposes of the preliminary phase of this investigation, we find that the volume of the subject

imports was significant during the period of investigation, both in absolute terms and relative to

consumption in the United States. In this regard, we note that the increases in subject import market

share during the period were almost entirely at the expense of the domestic industry.134

B. Price Effects of the Subject Imports

Section 771(C)(ii) of the Act135 provides that, in evaluating the price effects of subject imports,

the Commission shall consider whether – (I) there has been significant price underselling by the imported

merchandise as compared with the price of domestic like products of the United States, and (II) the effect

of imports of such merchandise otherwise depresses prices to a significant degree or prevents price

increases, which otherwise would have occurred, to a significant degree. 

As noted above, the record indicates that there is a moderate to high degree of substitutability

between domestic wooden bedroom furniture and the subject imports. The large majority of domestic

producers and importers agree that the domestic merchandise and the subject imports are always or

frequently interchangeable for one another.136 Moreover, the record indicates that price is a significant

factor in the purchase decision for wooden bedroom furniture, with the large majority of domestic
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 137 CR at II-29 & Table II-2, PR at II-19-20 & Table II-2.

 138 CR and PR at Table V-6a & Figures V-1 and V-2.

 139 CR and PR at Table V-6a & Figures V-1 & V-2.

 140 CR and PR at Table V-6a & Figures V-1 & V-2.

 141 CR and PR at Table V-6a & Figures V-1 & V-2. Because the domestic industry was unable to provide their

prices for the price comparison products on a suite-specific basis, the Commission staff constructed aggregate prices

for these suites by adding together reported prices for the four individual items within each suite (i.e., for the bed,

dresser, mirror and night stand). CR at V-16, PR at V-10-11.

 142 CR and PR at Table V-6a & Figures V-1 & V-2. We note, however, that the companies named in the

petitioners’ lost sale and revenue allegations did not confirm the allegations. CR at V-45-V-51, PR at V-37-V-39.

 143 CR and PR at Table V-6a & Figures V-1 & V-2.

 144 CR and PR at Table V-6a & Figures V-1 & V-2.

20

producers and a substantial minority of importers reporting that non-price factors are only sometimes or

never a significant factor in the purchase decision.137 

The record pricing data in this preliminary investigation show consistent and substantial

underselling by the subject Chinese imports throughout the period of investigation.138 The subject

imports undersold the domestic merchandise on 51 of 52 possible quarterly price comparisons for the

Louis Philippe-style wooden bedroom furniture pieces examined by the Commission, at margins ranging

from 4.9 percent to 65.0 percent during the period.139 Similarly, the subject imports undersold the

domestic merchandise on all 56 possible quarterly price comparisons for the Mission-style wooden

bedroom furniture pieces examined by the Commission, at margins ranging from 13.1 percent to 77.2

percent.140 On a suite-level basis, the subject imports undersold the domestic merchandise on all 26

possible price comparisons for the Mission-style and the Louis Philippe style bedroom furniture, at

margins ranging from 22.8 percent to 64.3 percent.141 Moreover, the record pricing data indicate that, for

all of the price comparison products, this consistent underselling was accompanied by significant

increases in shipments of the subject imports and declines in shipments for domestic merchandise. Thus,

the record data indicate that this underselling led to a substantial loss of sales by the domestic industry to

the subject imports on the price comparison products during the period of investigation.142

However, the record is more mixed with respect to whether the subject imports suppressed or

depressed domestic prices during the period. Although the price comparison data show consistent and

significant underselling by imports during the period of investigation, they do not indicate a consistent

pattern of domestic price declines during the period as well. For example, although the average price of

the bed in the domestic Louis Philippe bedroom suite examined by the Commission declined by more

than 28 percent during the period of investigation, the average domestic price of the other three

components in the suite (i.e., the night stand, the dresser and the mirror) all declined by less than 3

percent over the period.143 Similarly, although there was a decline of 10 percent in the average price of

the bed in the domestic Mission-style suite during the period of investigation, the prices of the three other

pieces in that suite declined by less than 2.5 percent over the period of investigation, with the price of one

product (the night stand) actually increasing somewhat during the period.144 

On the other hand, the record does show that the constructed domestic quarterly selling prices for

both the Louis Philippe suite and the Mission-style suite, as a whole, both declined during the period,

with the Louis Philippe suite’s constructed price being 8.7 percent lower during the second quarter of

2003 than in the first quarter of 2000, and the Mission’s style suite’s price being 4.0 percent lower
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 145 CR and PR at V-35, n. 52; CR and PR at Tables V-2-V-5 & Figures V-1 and V-2.

 146 In this regard, we note that the record does not show evidence of a significant cost-price squeeze, with the

industry’s cost of goods sold only increasing from 77.1 percent of sales revenue in 2000 to 78.5 percent in 2002, and

then to 79.7 percent in interim 2003. CR and PR at Tables VI-1 & C-1.

 147 In any final phase of this investigation, we will seek pricing data that will allow us to make price comparisons

that more closely reflect different product types and quality. We invite the parties to address this issue when

submitting comments on draft questionnaires in any final phase of this investigation pursuant to 19 C.F.R.

§207.20(b).

 148 In its notice of initiation, Commerce published estimated dumping margins for China ranging from 158.74

percent to 440.96 percent. 68 Fed. Reg. 70231 (Dec. 17, 2003).

 149 19 U.S.C. § 1677(7)(C)(iii); see also SAA at 851 and 885 (“In material injury determinations, the Commission

considers, in addition to imports, other factors that may be contributing to overall injury. While these factors, in

some cases, may account for the injury to the domestic industry, they also may demonstrate that an industry is facing

difficulties from a variety of sources and is vulnerable to dumped or subsidized imports.”) SAA at 885.

 150 19 U.S.C. § 1677(7)(C)(iii); see also SAA at 851, 885; Live Cattle from Canada and Mexico, Inv. Nos. 701-

TA-386, 731-TA-812-813 (Preliminary), USITC Pub. 3155 at 25 n.148 (Feb. 1999).

 151 CR and PR at Tables IV-3 & C-1.

 152 CR and PR at Table C-1.

21

between these periods.145 In sum, although the pricing data show that the subject imports have had some

adverse price-depressive effects on domestic pricing during the period, the data do not show a consistent

pattern of significant price effects on a majority of the price comparison products.146 

On the whole, we find that there has been consistent and significant underselling by the subject

imports and there is evidence of some adverse price effects as a result of this underselling. However, the

evidence is mixed regarding the subject imports’ price-suppressing or depressing effects. We intend to

examine the price effects of subject imports more closely in any final phase of this investigation.147

C. Impact of the Subject Imports148

Section 771(7)(C)(iii) provides that the Commission, in examining the impact of the subject

imports on the domestic industry, “shall evaluate all relevant economic factors which have a bearing on

the state of the industry.”149 These factors include output, sales, inventories, capacity utilization, market

share, employment, wages, productivity, profits, cash flow, return on investment, ability to raise capital,

research and development, and factors affecting domestic prices. No single factor is dispositive and all

relevant factors are considered “within the context of the business cycle and conditions of competition

that are distinctive to the affected industry.”150

During the period of investigation, as the subject imports entered the market in increasing

volumes at prices that consistently undersold the domestic industry, the domestic industry experienced

substantial declines in almost all of its trade and financial indicia. While the subject imports gained 11.5

percentage points of market share during the period from 2000 through 2002, the industry lost 12.5

percentage points of market share151 and saw significant declines in its capacity, production, capacity

utilization, domestic shipments, net sales values and quantities, employment levels, operating income,

operating income margins, and capital investment.152
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 153 CR and PR at Tables III-2 & C-1 The industry’s reported capacity fell from 14.82 million pieces in 2000 to

14.26 million pieces in 2002, and was 7.40 million pieces and 6.89 million pieces in interim 2002 and 2003,

respectively. Id.

 154 CR and PR at Tables III-2 & C-1. The industry’s reported production volume fell from 13.72 million pieces

in 2000 to 12.31 million pieces in 2002, and was 6.6 million pieces and 6.1 million pieces in interim 2002 and 2003,

respectively. Id. The industry’s reported capacity utilization rate fell from 82.7 percent in 2000 to 75.4 percent in

2002. It was 79.1 percent and 75.4 percent in interim 2002 and 2003, respectively.

 155 CR and PR at Tables III-7 & C-1. 

 156 CR and PR at Tables III-3 & C-1. The value of the industry’s domestic shipments dropped from $2.5 billion

in 2000 to $2.1 billion in 2002, and was $1.1 billion and $959 million in interim 2002 and 2003, respectively. Id. 

 157 CR and PR at Tables VI-1 & C-1. The industry’s aggregate net sales value declined from $2.69 billion in

2000 to $2.16 billion in 2002, and was $1.18 billion and $1.0 billion in interim 2002 and 2003, respectively. Id. 

The industry’s aggregate net sales quantity fell from 14.3 million pieces in 2000 to 12.8 million pieces in 2002, and

was 7.0 million pieces and 6.3 million pieces in interim 2002 and 2003, respectively. Id.

 158 CR and PR at Tables VI-1 & C-1. The industry’s aggregate operating income fell from $271.3 million in 2000

to $168.1 million in 2002, and was $118.5 million and $64.7 million in interim 2002 and 2003, respectively. Id.

 159 CR and PR at Tables VI-1 & C-1. The industry’s operating income as a percentage of net sales fell from 10.3

percent in 2000 to 7.8 percent in 2002, and was 10.0 percent and 6.5 percent in interim 2002 and 2003, respectively. 

Id.

 160 CR and PR at Table VI-4 & C-1. The industry’s capital expenditures fell from $72.4 million in 2000 to $35.9

million in 2002, and were $16.9 million and $14.0 million in interim 2002 and 2003, respectively.

22

The industry’s reported capacity fell by 3.8 percent from 2000 to 2002, and by 6.9 percent

between interim periods.153 The industry’s production volume fell by 10.3 percent from 2000 to 2002

and by 8.2 percent between interim periods, while its capacity utilization rate declined by 7.4 percentage

points from 2000 to 2002 and by 3.7 percentage points between interim periods.154 The number of

production workers employed by the industry declined by 17.3 percent between 2000 and 2002 and by

10.6 percent between interim periods, wages paid by the industry fell by 14.0 percent from 2000 to 2002

and by 13.1 percent between interim periods, and hours worked in the industry fell by 18.0 percent from

2000 to 2002 and by 12.6 percent between interim periods.155 

The value of the industry’s domestic shipments declined by 16.9 percent from 2000 to 2002 and

by 14.4 percent between interim periods.156 The industry’s net sales values declined by 17.7 percent from

2000 to 2002 and by 15.1 percent between interim periods, while its net sales quantities declined by 10.4

percent from 2000 to 2002 and by 9.4 percent between interim periods.157 The industry’s profitability

fell during this period, with its operating income falling by 38 percent from 2000 to 2002 and by 45.3

percent between interim periods.158 The industry’s operating margins declined by 2.5 percentage points

from 2000 to 2002, and by 3.5 percent between interim periods.159 Finally, the industry’s capital

expenditures fell by 50.4 percent from 2000 to 2002 and by 17.3 percent between interim periods.160 

For purposes of this preliminary determination, we conclude that subject imports had a significant

adverse impact on the condition of the domestic industry during the period of investigation. As discussed

above, there were significant increases in the volumes of the subject imports and the subject imports

consistently and significantly undersold the domestic merchandise during the period of investigation. The

domestic industry lost significant market share to the subject imports, which in turn significantly affected

the industry’s production, shipments and sales volumes as well as nearly all of its other indicators. 

Although the industry’s operating margin remained positive throughout the period of investigation (it was

at 7.8 percent in 2002 and 6.5 percent in interim 2003), the industry’s aggregate operating income fell by

38 percent from 2000 to 2002 and by a further 45.3 percent between interim periods. We therefore find
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 161 Lacquer Craft Postconference Brief at p. 2; Furniture Retailers Group Postconference Brief at p. 10-13;

Furniture Brands Postconference Brief at p. 6-10.

 162 Lacquer Craft Postconference Brief at p. 2. Respondents contend that the petitioners have been less

successful than other domestic producers in implementing this strategy. Id. at pp. 3-4.

 163 Furniture Retailers Group Postconference Brief at pp. 1 & 4-9; Furniture Brands Postconference Brief at p. 3-

4. However, the record provides only very limited evidence to support this scenario.

 164 Lacquer Craft Postconference Brief at p. 32; Furniture Retailers Group Postconference Brief at p. 9-10. While

apparent domestic consumption has increased over the period, the record also shows that other factors such as low

mortgage interest rates and new housing starts contributed to increased demand.

23

that subject imports adversely impacted the performance of the domestic industry during the period of

investigation.

In making this finding, we have closely examined the arguments of respondents that imports have

not harmed, but have indeed benefitted, the domestic industry. For example, respondents argue that the

volume of the subject imports increased during the period because many domestic producers have

adopted a business strategy of “blending” their sales of domestically produced bedroom furniture with

imports of subject merchandise,161 and that the use of such a “blended” supply strategy has allowed most

domestic producers to offer products that cannot be economically made domestically and to maintain

reasonable levels of profits during the period of investigation.162 Respondents also argue that Petitioners

were themselves responsible for first leading Chinese companies into the U.S. market and that Petitioners

only “lost patience” with the Chinese imports being in the market when large retailers began purchasing

directly from the Chinese producers.163 Finally, respondents contend that the increasing volumes of lowpriced Chinese product have created demand for wooden bedroom furniture that would not otherwise

have existed.164 We find that the record in this preliminary investigation, as discussed above, provides a

reasonable indication that the significant volume of subject imports have had an adverse material impact

on the domestic industry, notwithstanding respondents' arguments. However, we intend to examine these

issues further in any final phase of this investigation. 

CONCLUSION

Accordingly, we determine that there is a reasonable indication that an industry in the United

States is materially injured by reason of imports of wooden bedroom furniture from China that are

allegedly sold in the United States at less than fair value.

Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 1 In this investigation, subject imports from China accounted for more than three percent of the volume of all

wooden bedroom furniture imported into the United States in the most recent 12-month period for which data are

available preceding the filing of the petition. See CR/PR, table IV-3 . As such, I find that the subject imports are

not negligible under 19 U.S.C. § 1677(24).

 2

 19 U.S.C. § 1677(7)(F)(ii).

 3

 19 U.S.C. § 1677(7)(F)(ii).

 4

 19 U.S.C. § 1677(7)(F)(i). These factors include: any existing unused production capacity or imminent,

substantial increase in production capacity in the exporting country; a significant rate of increase of the volume or

market penetration of imports of the subject merchandise indicating the likelihood of substantially increased imports;

whether imports of the subject merchandise are entering at prices that are likely to have a significant depressing or

suppressing effect on the domestic prices and are likely to increase demand for further imports; inventories of the

subject merchandise; the potential for product shifting; and the actual and potential negative effects on the existing

development and production efforts of the domestic industry. 19 U.S.C. § 1677(7)(F)(i). Statutory threat factor (I)

is inapplicable, as no countervailable subsidies are involved, and statutory threat factor (VII) is inapplicable, as no

imports of agricultural products are involved. Id.

In addition, I observe that in its notice of initiation, Commerce estimated that dumping margins for the

subject imports range from 158.74 to 440.96 percent. 68 Fed. Reg. at 70228.

25

SEPARATE VIEWS OF COMMISSIONER PEARSON

Based on the record in this investigation, I find that there is a reasonable indication that an

industry in the United States is threatened with material injury by reason of imports of wooden bedroom

furniture from China that are allegedly sold in the United States at less than fair value (“LTFV”). 

However, I agree with the Commission’s findings with respect to the domestic like product, the domestic

industry and related parties, and conditions of competition, and therefore join in sections I-V of the views

of the Commission.

I. REASONABLE INDICATION OF THREAT OF MATERIAL INJURY BY REASON OF

SUBJECT IMPORTS1

A. General Legal Standards

Section 771(7)(F) of the Act directs the Commission to determine whether the U.S. industry is

threatened with material injury by reason of the subject imports by analyzing whether “further dumped or

subsidized imports are imminent and whether material injury by reason of imports would occur unless an

order is issued or a suspension agreement is accepted.”2

 The Commission may not make such a

determination “on the basis of mere conjecture or supposition,” and considers the threat factors “as a

whole” in making its determination whether dumped or subsidized imports are imminent and whether

material injury by reason of subject imports would occur unless an order is issued.3

In making my determination, I have considered all statutory threat factors that are relevant to this

investigation.4

 Based on my evaluation of the record compiled in this preliminary phase of the

investigation, I have determined that there is a reasonable indication that the domestic wooden bedroom

furniture industry is threatened with material injury by reason of subject imports from China.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 5 CR/PR, Table IV-3.

 6

 CR at VII-1. PR at VII-1.

 7

 CR/PR, Table VII-1.

 8

 CR/PR, Table VII-1.

 9

 CR/PR, Table VII-1.

26

B. Analysis of Statutory Threat Factors

The volume and market penetration of the subject imports increased steadily through the period

examined, with the increases accelerating during the latter portion of the period. Subject import volume

and market penetration were both substantially higher in interim 2003 than in interim 2002. By value,

subject imports increased from $432.7 million in 2000 to $565.6 million in 2001 and then to $957.9

million in 2002. Subject imports further increased by 54.3 percent between the interim periods, from

$404.7 million in interim 2002 to $624.6 million in interim 2003. Subject imports’ share of the value of

apparent U.S. consumption increased from 10.3 percent in 2000 to 14.0 percent in 2001 and then to 21.8

percent in 2002, and was higher in interim 2003 at 27.8 percent than in interim 2002, when it was 18.6

percent.5

The increases in subject import volume and market penetration during the latter portion of the

period examined indicate that Chinese producers have both the ability and inclination to increase their

exports to the United States sharply. The available data from those Chinese producers that responded to

the Commission’s questionnaire, whose exports to the United States accounted for 57.0 percent of total

subject imports in 2002,6

 indicate that the capacity of producers of subject merchandise in China to

produce wooden bedroom furniture increased by 153.9 percent from 1.8 million pieces in 2000 to 4.5

million pieces in 2002, and continued to increase by 31.5 percent between the interim periods. In

addition, Chinese producers’ capacity is projected to increase by 46.9 percent from 4.5 million pieces in

2002 to 6.6 million pieces in 2004.7

Chinese producers’ capacity utilization rates were relatively high during the period of

investigation, ranging from 85.2 percent to 95.6 percent during the period. However, given the

substantial capacity increases, Chinese producers were able to increase production by 167.4 percent from

1.8 million pieces in 2000 to 4.7 million pieces in 2002, and production continued to increase by 29.1

percent between the interim periods. Furthermore, Chinese producers’ production is projected to increase

by 42.9 percent from 4.7 million pieces in 2002 to 6.7 million pieces in 2004. This indicates that, despite

their relatively high capacity utilization rates, the Chinese producers likely have the ability to increase

their exports to the United States in the imminent future.8

Chinese producers’ shipments of wooden bedroom furniture are focused on the U.S. market. 

Chinese producers exported between 90.5 percent and 96.4 percent of their total shipments during

January 2000-June 2003, and project that they will export 96.5 percent of their total shipments in both

2003 and 2004.9

 Chinese producers’ exports to the United States, as a share of their total shipments,

increased from 80.5 percent in 2000 to 86.8 percent in 2002, and continued to increase between the

interim periods from 85.2 percent to 89.0 percent. In addition, Chinese producers’ exports to the United

States are projected to increase by 54.3 percent during 2002-2004, and to account for 89.5 percent of their

total shipments in 2003 and 2004. In light of the importance of the U.S. export market to the Chinese

wooden bedroom furniture industry, the historical data showing large recent increases in exports to the
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 10 CR/PR, Table VII-1.

 11 CR/PR, Table VII-2.

 12 CR/PR, Table VII-1.

 13 CR at V-43. PR at V-30. Staff reported that significant differences in reported prices among several of the

reporting U.S. producers and among several of the importers for each specified wooden bedroom furniture product

likely reflected several factors including differences in physical characteristics within the product specifications

provided. CR at V-17-V-19. PR at V-12-V13. In any final phase investigation, I would seek to improve the

comparability of the price data.

 14 CR at V-37 and Tables V-7-V-8. PR at V-30 and Tables V-7-V-8.

 15 CR at V-43 and Tables V-2-V-5. PR at V-30 and Tables V-2-V-5.

 16 CR at V-35 and n. 51. PR at V-28 and n. 51.

 17 CR/PR, Table IV-3.

27

United States, and the projected increases in exports to the United States, I believe that substantially

increased subject imports are likely.10

I have also considered inventory levels. Inventories of pieces of the subject merchandise in the

United States and the ratio of these inventories to imports increased from 2000 to 2002 and between the

interim periods.11 The value of inventories of the subject merchandise in China also increased during

2000-2002 and between the interim periods, as did the ratio of these inventories to total shipments.12

The available evidence indicates pervasive underselling by the subject imports during the period

examined.13 The subject imports undersold the domestic like product in 107 out of 108 quarterly

comparisons, by margins ranging from 4.9 percent to 77.2 percent during January 2000-June 2003. 

Given this historical pattern of underselling, it is likely that the subject imports will continue to undersell

the domestic like product in the imminent future.14

During the period examined, the weighted-average prices of the eight specified U.S.-produced

furniture products and four of the specified imported Chinese products fluctuated but generally ended

somewhat lower by the end of the period, while the weighted-average prices of the remaining four

specified imported Chinese products fluctuated but generally ended measurably higher at the end of the

period.15 However, viewing dis-aggregated price data for each responding U.S. producer and importer

indicates that, in most cases, prices of the specified U.S.-produced and imported Chinese products

increased or were maintained during much of January 2000-June 2003.16

Although the extent to which the subject imports affected price levels for the domestic like

product during the period examined is unclear, subject imports did gain market share at the expense of the

domestic industry. The subject imports gained 11.5 percentage points of market share between 2000 and

2002, while the domestic industry lost 12.5 percentage points, the bulk of which occurred after 2001. 

Subject import market penetration was 9.2 percentage points higher in interim 2003 than in interim 2002;

by contrast, the domestic industry’s market share was 8.8 percentage points lower in interim 2003 than in

interim 2002.17
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 18 Given the size of this industry, the Commission received relatively few usable lost sales and lost revenue

allegations. Staff received 20 usable lost sales and lost revenue allegations. Staff contacted the purchasers named in

16 of these allegations, and received responses from nine purchasers. Seven of these purchasers disagreed with the

petitioners allegations, and two could neither confirm nor deny the allegations.

 19 The domestic industry’s capacity decreased during the period examined. In terms of pieces, capacity fell by 3.8

percent from 14.8 million pieces in 2000 to 14.3 million pieces in 2002, and fell another 6.9 percent between the

interim periods In terms of pounds, capacity fell by 6.8 percent from 1.12 billion pounds in 2000 to 1.05 billion

pounds in 2002, and continued to fall by 8.1 percent between the interim periods. In terms of pieces, capacity

utilization fell from 82.7 percent in 2000 to 75.4 percent in 2002, and continued to fall from 79.1 percent in interim

2002 to 75.4 percent in interim 2003. In terms of pounds, capacity utilization fell from 78.9 percent in 2000 to 72.0

percent in 2002, and continued to fall from 74.4 percent in interim 2002 to 72.4 percent in interim 2003. CR/PR,

Table III-2.

 20 In terms of pieces, domestic production declined by 10.3 percent from 13.7 million pieces in 2000 to 12.3

million pieces in 2002, and continued to fall by 8.2 percent between the interim periods. In terms of pounds,

domestic production declined by 10.6 percent from 1.0 billion pounds in 2000 to 931 million pounds in 2002, and

continued to fall by 6.2 percent between the interim periods. CR/PR, Table III-2. The value of domestic producers’

U.S. shipments fell by 16.9 percent from $2.5 billion in 2000 to $2.1 billion in 2002, and continued to fall by 14.4

percent between the interim periods CR/PR, Table III-3.

 21 Production and related workers fell by 17.3 percent from 38,687 in 2000 to 31,990 in 2002, and continued to

fall by 10.6 percent between the interim periods. Hours worked fell by 18.0 percent from 67,425 in 2000 to 55,311

in 2002, and continued to fall by 12.6 percent between the interim periods. Wages paid fell by 14.0 percent from

$856.6 million in 2000 to $736.5 million in 2002, and continued to fall by 13.1 percent between the interim periods. 

CR/PR, Table III-7. In any final phase investigation I intend to further examine the extent to which the recent

employment declines are reflective of a longer-term trend in the industry.

 22 Operating income declined by 38.0 percent from $271.3 million in fiscal year 2000 to $168.1 million in fiscal

year 2002, and continued to fall by 45.3 percent between the interim periods. Operating margins declined from 10.3

percent in fiscal year 2000 to 7.8 percent in fiscal year 2002. The 6.5 percent operating margin in interim 2003 was

lower than the 10.0 percent operating margin in interim 2002. CR/PR, Table VI-1.

 23 Domestic producers’ capital expenditures fell by 50.4 percent from $72.4 million in fiscal year 2000 to $35.9

million in fiscal year 2002, and continued to fall by 17.3 percent between the interim periods. CR/PR, Table VI-4.

28

Thus, by pervasively underselling the domestic like product, the subject imports took appreciable

market share away from the domestic industry during the latter portion of the period examined. In the

immediate future, the subject imports appear poised to enter at prices that are likely to increase demand

for further imports, causing the domestic industry to lose sales and market share at even a greater rate

than during the period examined.18

The domestic industry exhibited reasonably healthy operating results throughout the period

examined, notwithstanding its loss of market share. However, the industry did show deteriorating

performance in several important indicators. Even with rising apparent U.S. consumption and sufficient

excess capacity,19 the industry’s production and U.S. shipments declined during 2000-2002, and between

the interim periods.20 Production and related workers, hours worked, and wages paid all fell during 2000-

2002 and between the interim periods.21 Both the industry’s operating income and its ratio of operating

income to net sales declined throughout the period examined; the industry’s operating margin was

considerably lower in interim 2003 than in interim 2002.22 Industry capital expenditures also declined

throughout the period examined.23
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

29

The record in the preliminary phase of this investigation indicates that subject import volumes are

likely to increase. Persistent underselling by the subject imports will cause the domestic industry to lose

sales and market share at an even greater rate than during the period examined. Given the likely lost sales

volumes, domestic industry sales revenues would be expected to decline sharply along with concomitant

adverse impacts on industry employment and financial performance. Accordingly, I determine that there

is a reasonable indication that further subject imports are imminent and material injury by reason of

subject imports will occur.

CONCLUSION

For the foregoing reasons, I determine that there is a reasonable indication that the domestic

industry producing wooden bedroom furniture is threatened with material injury by reason of subject

imports of wooden bedroom furniture from China that are allegedly sold at less than fair value.

Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 1 On December 4, 2003, the petitioners amended the petition to include four additional labor unions as copetitioners: UBC Southern Council of Industrial Workers Local Union 2305, Columbus, MS; United Steel Workers

of America Local 193U, Lewisburg, PA; Carpenters Industrial Union Local 2093, Phoenix, AZ; and Teamsters,

Chauffeurs, Warehousemen and Helpers Local 991, Bay Minette, AL. See letter to the Commission and Commerce

from petitioners dated December 4, 2003.

 2

 The merchandise subject to this investigation is wooden bedroom furniture, as described in the section entitled

The Subject Product in Part I of this report. 

I-1

PART I: INTRODUCTION

BACKGROUND

This investigation was instituted in response to a petition filed with the U.S. International Trade

Commission (Commission) and the U.S. Department of Commerce (Commerce) on October 31, 2003, by

the American Furniture Manufacturers Committee For Legal Trade, Washington, DC, and its individual

members, and the Cabinet Makers, Millmen, and Industrial Carpenters Local 721, Whittier, CA.1

 The

petition alleges that an industry in the United States is materially injured, and threatened with material

injury, by reason of imports from China of wooden bedroom furniture2

 that are alleged to be sold in the

United States at less than fair value (LTFV). Information relating to the background of this investigation

is presented in table I-1.

Table I-1

Wooden bedroom furniture: Chronology of investigation No. 731-TA-1058

Date Action

October 31, 2003 Petition filed with Commerce and the Commission

October 31, 2003 Commission institutes investigation No. 731-TA-1058 (Preliminary)

November 10, 2003 Commission publishes notice of institution in the Federal Register1

November 21, 2003 Commission’s public conference2

November 24, 2003 Commerce publishes notice in the Federal Register extending the date

of initiation of investigation3

December 11, 2003 Commerce initiates investigation

December 17, 2003 Commerce publishes notice of initiation in the Federal Register4

January 9, 2004 Date of Commission’s vote

January 12, 2004 Commission’s transmittal of determination to Commerce

January 20, 2004 Commission’s views sent to Commerce

1

 68 FR 63816, November 10, 2003, presented in app. A. 

2

 A list of witnesses appearing at the conference is presented in app. B.

3

 68 FR 65875, November 24, 2003, presented in app. A. 

4

 68 FR 70228, December 17, 2003, presented in app. A. 

Source: Various Federal Register notices.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 3 68 FR 65875, November 24, 2003. See also Commerce’s memorandum from Edward C. Yang to Joseph A.

Spetrini, Antidumping Petition on Wooden Bedroom Furniture from China: Extension of Deadline, November 13,

2003.

 4

 67 FR 70228, December 17, 2003. In its notice of initiation, Commerce indicated that “{b}ased on information

provided in the Petition, the share of total estimated U.S. production of the domestic like product in calendar year

2002 represented by the Petitioners and the supporting domestic producers equal over 25 percent of total domestic

production,” and that “the domestic producers of wooden bedroom furniture who support the Petition account for

more than 57 percent of the production (by U.S. dollar sales value) of the domestic like product produced by that

portion of the industry expressing support for, or opposition to, the Petition.” Accordingly, Commerce determined

that the industry support requirements of section 732(c)(4)(A) of the Act have been met.

 5

 Coverage was calculated using the Commission’s total shipment value of $2.077 billion (see table III-3) and the

petitioners’ estimate of $2.5 billion. See petition, exh. 4. The petition estimated the total value of U.S. producers’

domestically produced U.S. shipments to be $*** in 2002. However, this figure is marked as confidential because

of the source of the data. Counsel to petitioners indicated that the figure of $2.5 billion can be used publicly and

noted that ***. Staff conversation with Joseph Dorn, counsel to petitioners, December 22, 2003.

 6

 The Commission received questionnaire responses from 82 U.S. importers accounting for approximately 87.4

percent of imports of wooden bedroom furniture from China during January 2000-June 2003. The Bureau of 

Customs and Border Protection (Customs) identifies over 1,100 individual firms as importers of record of the subject

merchandise from China during January 2002-June 2003.

I-2

On November 13, 2003, Commerce notified the Commission of its intent to extend the date for its

initiation by 20 days.3

 The purpose of the extension was to poll the domestic industry to determine

whether the petitioners had standing. On December 17, 2003, Commerce published its notice of initiation

in the Federal Register.

4

PREVIOUS INVESTIGATIONS

The Commission has not previously conducted antidumping or countervailing duty investigations

concerning wooden bedroom furniture.

ORGANIZATION OF THE REPORT

Information on the subject merchandise, alleged dumping margins, and the domestic like product

is presented in Part I. Information on conditions of competition and other economic factors is presented

in Part II. Information on the condition of the U.S. industry, including data on capacity, production,

shipments, inventories, and employment, is presented in Part III. Information on the volume of imports of

the subject merchandise, apparent consumption, and market shares is presented in Part IV. Part V

presents data on prices in the U.S. market. Part VI presents information on the financial experience of

U.S. producers. Information on the subject country foreign producers and U.S. importers’ inventories is

presented in Part VII.

SUMMARY OF DATA PRESENTED IN THE REPORT

A summary of data collected in the investigation is presented in appendix C. U.S. industry data

are based on the questionnaire responses of 40 firms accounting for approximately 83 percent of known

U.S. shipments (based on value) in 2002.5

 Data on U.S. imports are based on official statistics of

Commerce, except as noted.6

 Data on the industry in China are based on the questionnaire responses of

59 firms believed to account for approximately 57.0 percent of Chinese exports of the subject

merchandise to the United States in 2002.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 7 See 68 FR 70228, December 17, 2003.

 8 See also petition at 15 and exh. 18.

 9 See table III-1 in Part III of this report.

 10 The top ten importers reported U.S. shipments of $525.3 million in subject merchandise during 2000-2002

while U.S. imports of the subject merchandise were $957.9 million in 2002.

 11 The Commission did not issue purchaser questionnaires in the preliminary phase of this investigation;

therefore, data on U.S. purchasers of domestically produced wooden bedroom furniture are not readily available. 

Staff requested a list of the top ten purchasers of domestically produced wooden bedroom furniture from counsel to

the petitioners. See e-mail from Joseph Dorn, counsel to petitioners, dated December 19, 2003.

 12 The purchasers are based on the value of their purchases of imported wooden bedroom furniture from China.

I-3

THE NATURE AND EXTENT OF ALLEGED SALES AT LTFV

On December 17, 2003, Commerce published its notice of initiation in the Federal Register.

7

Based on comparisons of export price to normal value, the estimated dumping margins for wooden

bedroom furniture range from 158.74 percent ad valorem to 440.96 percent ad valorem.

8

 The period of

investigation for Commerce’s dumping investigation is April 2003-September 2003.

SUMMARY OF MARKET PARTICIPANTS

Table I-2 presents a list of the largest U.S. producers and importers of wooden bedroom furniture. 

The top 10 U.S. producers accounted for 68.5 percent of reported U.S. producers’ shipments (based on

value) during 2000-02.9

 The top 10 U.S. importers accounted for 54.8 percent of U.S. shipments of the

subject imported merchandise during 2000-02.10

Table I-2

Wooden bedroom furniture: Largest U.S. producers and U.S. importers of the subject merchandise, 

2000-02

*******

Table I-3 presents a list of the largest known purchasers of domestically produced wooden

bedroom furniture,11 and the largest purchasers of subject merchandise imported from China.12

Table I-3

Wooden bedroom furniture: Largest U.S. purchasers of domestically produced product and subject

merchandise imported from China, 2000-02

*******
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 13 A chest-on-chest is typically a tall chest-of-drawers in two or more sections (or appearing to be in two or more

sections), with one or two sections mounted (or appearing to be mounted) on a slightly larger chest; it is also known

as a tallboy.

 14 A highboy is typically a tall chest of drawers usually composed of a base and a top section with drawers, and

supported on four legs or a small chest (often 15 inches or more in height).

 15 A lowboy is typically a short chest of drawers, not more than four feet high, normally set on short legs.

 16 A chest of drawers is typically a case containing drawers for storing clothing.

 17 A chest is typically a case piece taller than it is wide, with or without one or more doors, featuring a series of

drawers for storing clothing. The piece can either include drawers or be designed as a large box incorporating a lid.

 18 A door chest is typically a chest with hinged doors to store clothing, whether or not containing drawers. The

piece may also include shelves for televisions and other entertainment electronics. 

 19 A chiffonier is typically a tall and narrow chest of drawers normally used for storing undergarments and

lingerie, often with mirror(s) attached.

 20 A hutch is typically an open case of furniture with shelves that typically sits on another piece of furniture and

provides storage for clothes.

 21 An armoire is typically a tall cabinet or wardrobe (typically 50 inches or taller), with doors, and with one or

more drawers (either exterior below or above the doors or interior behind the doors), shelves, and/or garment rods or

other apparatus for storing clothes. Bedroom armoires may also be used to hold television receivers and/or other

audio-visual entertainment systems.

I-4

THE SUBJECT PRODUCT

Scope

Commerce has defined the product subject to investigation as the following–

For purposes of this investigation, the product covered is wooden bedroom furniture (i.e.,

subject merchandise). Wooden bedroom furniture is generally, but not exclusively,

designed, manufactured, and offered for sale in coordinated groups, or bedrooms, in

which all of the individual pieces are of approximately the same style and approximately

the same material and/or finish. The subject merchandise are [sic] made substantially of

wood products, including both solid wood and also engineered wood products made from

wood particles, fibers, or other wooden materials such as plywood, oriented strand

board, particle board, and fiberboard; with or without wood veneers, wood overlays, or

laminates; with or without non-wood components or trim such as metal, marble, leather,

glass, plastic, or other resins; and whether or not assembled, completed, or finished.

The subject merchandise includes (1) wooden beds such as loft beds, bunk beds, and

other beds; (2) wooden headboards for beds (whether stand-alone or attached to side

rails), wooden footboards for beds, wooden side rails for beds, and wooden canopies for

beds; (3) night tables, night stands, dressers, commodes, bureaus, mule chests,

gentlemen’s chests, bachelor’s chests, lingerie chests, wardrobes, vanities, chessers,

chifforobes, and wardrobe-type cabinets; (4) dressers with framed glass mirrors that are

attached to, incorporated in, sit on, or hang over the dresser; (5) chests-on-chests,13

highboys,14 lowboys,15 chests of drawers,16 chests,17 door chests,18 chiffoniers,19 hutches,20

and armoires;21 (6) desks, computer stands, filing cabinets, book cases, or writing tables

that are attached to or incorporated in the subject merchandise; and (7) other bedroom

furniture consistent with the above list.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 22 As used herein, bentwood means solid wood made pliable. Bentwood is wood that is brought to a curved shape

by bending it while made pliable with moist heat or other agency, and then set by cooling or drying. See Customs’

Headquarters’ Ruling Letter 043859, dated May 17, 1976.

I-5

The scope of the Petition excludes (1) seats, chairs, benches, couches, sofas, sofa beds,

stools, and other seating furniture; (2) mattresses, mattress supports (including box

springs), infant cribs, water beds, and futon frames; (3) office furniture, such as desks,

stand-up desks, computer cabinets, filing cabinets, credenzas, and bookcases; (4) dining

room or kitchen furniture such as dining tables, chairs, servers, sideboards, buffets,

corner cabinets, china cabinets, and china hutches; (5) other non-bedroom furniture,

such as television cabinets, cocktails tables, end tables, occasional tables, wall systems,

book cases, and entertainment systems; (6) bedroom furniture made primarily of wicker,

cane, osier, bamboo or rattan; (7) side rails for beds made of metal if sold separately

from the headboard and footboard; and (8) bedroom furniture in which bentwood parts

predominate.22 

Imports of subject merchandise are classified under statistical category 9403.50.9040 of

the Harmonized Tariff Schedule of the United States (“HTSUS”) as “wooden...beds” and

under statistical category 9403.50.9080 of the HTSUS as “other...wooden furniture of a

kind used in the bedroom.” In addition, wooden headboards for beds, wooden

footboards for beds, wooden side rails for beds, and wooden canopies for beds may also

be entered under statistical category 9403.50.9040 of the HTSUS as “parts of wood” and

framed glass mirrors may also be entered under statistical category 7009.92.5000 of the

HTSUS as “glass mirrors...framed.” This investigation covers all wooden bedroom

furniture meeting the above description, regardless of tariff classification. Although the

HTSUS subheadings are provided for convenience and customs purposes, our written

description of the scope of this proceeding is dispositive.

U.S. Tariff Treatment

Table I-4 presents current tariff rates for wooden bedroom furniture. The scope includes four

HTS statistical reporting numbers; however, most of the subject imports enter under the first two

statistical reporting numbers (9403.50.9040 and 9403.50.9080). The other two statistical reporting

numbers (9403.90.7000 and 7009.92.5000) are residual or “basket” categories for wooden parts and glass

mirrors. 

Customs collects quantity data for beds but not for other wooden bedroom furniture; therefore,

only value data for official statistics are presented throughout this report.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 23 The Commission’s decision regarding the appropriate domestic products that are “like” the subject imported

products is based on a number of factors including (1) physical characteristics and uses; (2) common manufacturing

facilities and production employees; (3) interchangeability; (4) customer and producer perceptions; (5) channels of

distribution; and, where appropriate, (6) price.

 24 See petition at 16-24. See also petitioners’ postconference brief at 28.

 25 See postconference brief of Lacquer Craft Manufacturing Co., Ltd., Markor International Furniture (Tianjin)

Manufacturing Co., and the Committee for Free Trade in Furniture (joint respondents’ postconference brief) at 7.

I-6

Table I-4

Wooden bedroom furniture: Tariff rates, 2003

HTS provision Article description1

General2 Special3 Column 24

Rates (percent ad valorem)

9403.50.9040 Wooden furniture of a kind used in the bedroom:

Other (than bent-wood furniture):

Other (than designed for motor vehicle use):

Beds

Free Free 40.0

9403.50.90805 Wooden furniture of a kind used in the bedroom:

Other (than bent-wood furniture):

Other (than designed for motor vehicle use):

Other (than beds)

Free Free 40.0

9403.90.7000 Parts:

Other:

Of wood

Free Free 40.0

7009.92.5000 Glass mirrors, whether or not framed, including

rear-view mirrors:

Framed:

Over 929 cm2

 reflecting area

6.5 Free6

 45.0

1

 An abridged description is provided for convenience; however, an unabridged description may be obtained from the

respective headings, subheadings, and legal notes of the HTSUS. 2

 Normal trade relations, formerly known as the most-favored-nation duty rate, applicable to imports from Japan. 3

 For eligible goods under the Generalized System of Preferences, African Growth and Opportunity Act, Caribbean Basin

Economic Recovery Act, Andean Trade Preference Act, Automotive Products Trade Act, Israel Free Trade Agreement, Jordan

Free Trade Agreement, and NAFTA-originating goods of Canada and Mexico. 4

 Applies to imports from a small number of countries that do not enjoy normal or preferential trade relations duty status. 5

 Customs does not collect quantity data for this statistical reporting number.

6

 Imports from Jordan enter at a rate of 1.9 percent ad valorem.

Source: Harmonized Tariff Schedule of the United States (2003).

DOMESTIC LIKE PRODUCT ISSUES23

The petitioners argue that there is a single domestic like product (wooden bedroom furniture)

corresponding to the scope definition.24 Respondents Lacquer Craft Manufacturing Co., Ltd., Markor

International Furniture (Tianjin) Manufacturing Co., and the Committee for Free Trade in Furniture

“. . . recognize that for purposes of its preliminary determination the Commission does not have the data it

would need to take a different approach to the like product issues raised in this case, but want to reserve

our position on these issues” should the investigation proceed to a final phase.25 The respondents state

further that the treatment of varied goods (beds, nightstands, dressers, etc.) “as a single like product may

be inconsistent with the Commission’s traditional like product analysis,” that “there are clear divisions

among the various items of bedroom furniture in terms of physical characteristics and use, and products
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 26 See joint respondents’ postconference brief at 7-8.

 27 Portions of this discussion are derived from the petition at 20-24, from petitioners’ postconference brief at 13-

18, and from other sources as cited.

 28 In the furniture trade, the term “suites” is pronounced like the word “suits” as in bathing suits.

 29 Wooden bedroom suites can also be referred to as bedroom collections, bedroom groups, or bedrooms.

 30 See testimony of Harold Hewitt, President, Superior Furniture, conference transcript at 59.

 31 See joint respondents’ postconference brief at 8.

 32 For instance, in the New York market, a suite typically consists of a dresser, mirror, armoire, bed, and two

night stands. However, in California, a suite typically consist of a dresser, mirror, bed, and two night stands, while

in the southeastern United States, a suite typically consist of a dresser, mirror, chest, and bed. While there are

different ways of defining a suite across the country, retailers within a geographic region usually quote a suite in the

same way. See testimony of Wyatt Bassett, Executive Vice President of Vaughan-Bassett Furniture Company,

conference transcript at 116-117.

 33 See joint respondents’ postconference brief at 8.

I-7

such as beds and dressers or nightstands and mirrors are quite obviously not interchangeable,” and that

“there are large price differentials between the various products.”26 Other respondent parties have not

taken a position on the appropriate domestic like product. 

Physical Characteristics and Uses27

Wood bedroom furniture consists of furniture made of wood products and having physical

characteristics applicable to the intended use in a bedroom. The furniture consists of different individual

articles (e.g., beds, nightstands, chests, armoires, and dressers with mirrors) with different configurations

and uses, all of which share the physical characteristics imparted by their common raw material (wood

products) and by their intended function for use in a bedroom, as opposed to other types of furniture such

as dining room tables, china chests, and office desks. Specific types of wooden bedroom furniture

included in this investigation are listed in the scope of the investigation presented earlier in this section of

the report. Wooden bedroom furniture is used primarily in residences, lodging, and care facilities such as

assisted living facilities.

Wooden bedroom furniture is generally, but not exclusively, designed, manufactured, and offered

for sale in coordinated groups, commonly called bedroom suites28 or “bedrooms” in which all of the

individual pieces share the same basic design, raw materials, construction, and finish.29 At a minimum, a

suite includes a bed frame, chest of drawers, and a nightstand. As one furniture retailer stated: “Although

we are perfectly willing to sell different bedroom furniture items separately, the vast majority of our

customers, more than 90 percent, buy suites. This is the way virtually all retailers operate.”30

Respondents agree that the fact that bedroom furniture is sold as a single unit or suite may be true for

many sales, but it is “most certainly not true for all,”31 indicating that the definition of a suite is quite fluid

(different suites may contain one or two night stands, a chest or no chest, perhaps a mirror, and a range of

bed sizes), and even differs on a regional basis.32 Moreover, customers may buy a single piece of

furniture or any subset of the “so-called” suite.33 Wooden bedroom furniture suites are typically for either

the adult, youth, or hospitality markets. 
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 34 See full discussion in the section entitled Raw Material Costs, Fit, Finish, and Size/Scale in Part V this report

on U.S. producers’ and importers’ comments regarding differences in product characteristics of wooden bedroom

furniture in “good, better, and best” quality categories.

 35 These materials, ranked in descending order, are: (1) solid wood; (2) solid wood veneer on plywood; (3) solid

wood veneer on particles board; and (4) paper glued on composite board. 

 36 See testimony of Wyatt Bassett, Executive Vice President of Vaughan-Bassett Furniture, conference transcript

at 78-79.

 37 See joint respondents’ postconference brief at 15.

 38 The Furniture/Product Manufacturing found at http://www.furniture-design-services.com/furniture_or

_product_manufacture.htm, retrieved on December 22, 2003.

I-8

Adult bedroom suites are produced for at least three different price/quality points: low, middle,

and high.34 The quality of the material used in construction is a major factor that (along with other

factors, e.g., quality of construction and quality of finish) determines the price point at which the suites

are sold.35 The materials found in the lowest category of bedroom suites are (1) particle board

components for the interior structure that holds the drawers; (2) glued paper covering on the interior of

drawers; (3) a certain amount of stapled construction; and (4) plastic components that are designed to look

similar to wood. The front of a chest or dresser is often covered with wood, while sides are most likely of

particle board. Mid-priced bedroom suites usually include solid wood on the top of chests or dressers,

while wood veneered on the particle board is used on the side and front. A plywood interior structure

holds the drawers in place. High-priced bedroom suites use solid wood on drawer fronts and the top and

sides of chests and dressers.

Common Manufacturing Facilities and Production Employees

Wooden bedroom furniture is produced in facilities that may also produce non-bedroom wooden

furniture. In response to a question on whether they produce other products using the same equipment

and the same workers as those used to produce wooden bedroom furniture, most large producers

answered in the affirmative, stating that they produce other wooden furniture (e.g., dining room

furniture). With regard to bedroom furniture of materials other than wood (e.g., brass beds), such

furniture reportedly is not produced by the same U.S. producers that produce wooden bedroom

furniture.36

The process of manufacturing wooden bedroom furniture is similar in the United States, China,

and other producing countries. Lumber, veneers, and engineered wood products are sawed and/or cut into

shapes, furniture is assembled from those shapes, and the furniture is stained or painted, as needed, on a

finishing line.37

Manufacturing processes involved in the production of wooden bedroom furniture have been

increasingly automated. Computer-numerically-controlled equipment, which allows operators to input

complex, sequential demands instructing production machinery how to cut, rout, and/or carve different

furniture parts, have improved productivity. However, U.S. production of fully assembled wood furniture

remains moderately labor-intensive.

In the traditional method of bedroom furniture manufacturing, a prototype is made to serve as a

model for the furniture to be manufactured.38 To prepare the wood, logs are sawed into boards using a

large band saw/dimension saw machine. Next, the boards are dried (either naturally or through a kiln

dryer). If the boards are dried in a kiln dryer, they are first coated with a wood glue/white cement mixture
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 39 Production Aspect–Wood Industry Area, SI-LMUK, Bank Indonesia, found at

http://www.bi.go.id/sipunk/lm/eng/processed_wood/production.htm, retrieved on December 22, 3003. 

 40 See affidavit of ***, petitioners’ postconference brief at exh. 4, p. 2.

 41 See testimony of Jeffrey Seaman, President & CEO, Rooms To Go Inc., conference transcript at 154.

 42 See postconference brief of Furniture Brands International at 7.

I-9

to prevent the wood from bending. This wood is then stored in a warehouse until it readjusts to the

surrounding atmosphere. The dried board is cut according to the required measurements, vertically with a

rip-saw and horizontally with a cross-cut saw. Some furniture manufacturers make decorative carvings

on the components (table tops, legs, etc.) at this stage. The wood is then softened through sanding and

planing. Next, these components are assembled using glue, nails, and bolts. Producers usually conduct

quality control inspections once components are assembled. The fully assembled furniture is then

finished through the process of spraying, drying, waxing, staining, and buffing. The wooden bedroom

furniture is labeled and packed to protect the product from damage while the furniture is stored or

shipped.39

Interchangeability and Customer and Producer Perceptions

Wooden bedroom furniture generally is not interchangeable with other types of furniture such as

dining room tables, china cabinets, and office desks, which are essentially designed for use in rooms of

the house other than bedrooms. Wooden bedroom furniture is sold as suites of compatible articles of

furniture that are all for use in a bedroom. Of course, certain types of wooden bedroom furniture, (e.g.,

such as beds, nightstands, etc.), are different from each other in specific physical characteristics and uses

and are therefore not interchangeable. However, they are designed as an integrated unit to be compatible

in appearance and are generally sold together as suites.

Some bedroom furniture is made of material other than wood, such as metal (e.g., brass beds). 

U.S. producers’ and importers’ questionnaire responses regarding the substitution in demand in the retail

market between wooden bedroom furniture and bedroom furniture constructed of materials other than

wood are discussed in the section entitled “Substitute Products and Expenditures” in Part II of this report.

Part II of this report also contains information on the interchangeability between domestically

produced wooden bedroom furniture and such furniture produced in China and in other countries. In

general, the imported furniture is interchangeable with the domestically produced furniture, and is

sometimes a copy of the domestic product. Producers in China and elsewhere use generally the same or

comparable raw materials, production equipment, and manufacturing techniques as U.S. producers.40 In

fact, much of the wooden bedroom furniture imported from China and other countries is imported by U.S. 

producers of bedroom furniture, and may be designed in the United States.41 Some domestic producers

first began importing bedroom suites when they began to realize that they could broaden their product

lines, especially those involving more intricate carvings, details, and veneers, by sourcing them abroad.42
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 43 See joint respondents’ postconference brief at 9.

I-10

Channels of Distribution

Wooden bedroom furniture is generally sold in retail stores, as is non-bedroom furniture. 

Although non-bedroom furniture may be sold in the same stores, it is often displayed in a separate area of

the store. Retailers reserve what are known in the industry as “slots” (allocated space in a certain area of

a store) for bedroom suites, and it is these slots which serve as the primary channel of distribution for

wooden bedroom furniture. Further information on channels of distribution for wooden bedroom

furniture is presented in Part II of this report. 

Price

The Commission collected price data on eight specific types of wooden bedroom furniture,

consisting of various types of Louis Philippe style and Mission style beds, nightstands, and double

dressers. These data are presented in part V of this report. The prices among the individual types of

bedroom furniture (beds, nightstands, and dressers) often vary substantially. However, the products can

be (and may generally be) sold as suites, and in fact in Part V the prices of the specific articles of

furniture, while presented separately, have also been added together by staff to obtain constructed suite

prices. Joint respondents contend that wooden bedroom furniture is not priced on a suite-by-suite basis,

that price negotiations conducted by manufacturers are on a piece-by-piece basis, and that at retail sale the

goods are also priced individually.43
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 1 The questionnaires specifically requested that the firms report the value of their shipments to U.S. retailers, the

hospitality sector, furniture rental firms, and all other types of customers. In addition, separate shipment values were

requested for customers not related (by ownership) and related to the responding supplying firms. Shipments to

unrelated and related customers were requested on a U.S. f.o.b. selling price basis, while direct imports of retailers

were requested on a c.i.f., duty-paid (U.S. ports-of-entry) import price basis; these latter imports were included in the

category of related customers. In this way, both U.S. shipments to U.S. customers and direct imports by retailers

were valued at the wholesale level of the market, albeit not at a comparable selling price level of the market.

 2

 The reported U.S. shipments of the domestic and imported Chinese wooden bedroom furniture during January

2000-June 2003, by type of customer, totaled $9.3 billion and accounted for 62.8 percent of total U.S. apparent

consumption of wooden bedroom furniture during this period. The reported U.S. shipments of the domestic

products, by type of customer, of $6.8 billion accounted for 88.1 percent of the value of total reported U.S.

producers’ commercial shipments of domestic wooden bedroom furniture during this period, while reported U.S.

shipments of the imported Chinese products, by type of customer, of $2.5 billion accounted for 98.1 percent of the

value of total official U.S. imports of wooden bedroom furniture from China.

 3

 U.S. producers accounted for the total value of combined reported U.S. shipments of the domestic and imported

Chinese wooden bedroom furniture to the hospitality sector during January 2000-June 2003, of which 99.1 percent

was produced domestically ***. Petitioning U.S. producers accounted for 70.0 percent of the total value of

combined U.S. shipments of the domestic and imported Chinese wooden bedroom furniture shipped to the

hospitality sector during this period.

 4

 Based on the value of U.S. shipments of the domestic and imported Chinese wooden bedroom furniture, 

requested of U.S. producers and importers elsewhere in the questionnaires, by type of customer for 2002, distributors

accounted for 1.7 percent of the total reported combined U.S. shipments of domestic and imported Chinese wooden

bedroom furniture.

II-1

PART II: CONDITIONS OF COMPETITION IN THE U.S. MARKET

CHANNELS OF DISTRIBUTION

U.S. producers and importers sell their domestic and imported Chinese wooden bedroom

furniture primarily to retailers but also to hotels/motels, etc., in the hospitality sector, to furniture rental

firms, and to various other types of purchasers, including some to distributors. A total of 39 U.S.

producers and 77 U.S. importers reported in their questionnaire responses the value of their total U.S.

shipments of the domestic and imported Chinese wooden bedroom furniture during January 2000-June

2003, by principal type(s) of customers;1

 these data are shown in figure II-1.2 Approximately 92.0

percent of the total value of the combined reported U.S. shipments of domestic and imported Chinese

wooden bedroom furniture was shipped to U.S. retailers, 3.6 percent was to the hospitality sector,3

 2.1

percent was to furniture rental firms, and 2.3 percent was to all other types of customers during this

period.4

 Responding U.S. producers accounted for 82.0 percent and petitioning U.S. producers accounted

for 40.5 percent of the total reported combined shipment data. U.S. producers and importers selling the

domestic and Chinese wooden bedroom furniture to unrelated customers accounted for 92.7 percent of the

total combined reported shipment data, while U.S. retailers importing the Chinese wooden bedroom

furniture and U.S. producers selling their domestic wooden bedroom furniture in their own retail stores

together accounted for the remaining 7.3 percent of the total combined reported shipment data.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

II-2

Figure II-1

Wooden bedroom furniture: Values of total U.S. shipments of domestic and imported Chinese wooden

bedroom furniture, by type of customer, January 2000-June 2003

Note: Unrelated retailers refer to shipments of domestic and Chinese wooden bedroom furniture by U.S. producers

and importers to U.S. retailers unrelated (by ownership) to the suppliers. Related retailers refer primarily to direct

imports of Chinese wooden bedroom furniture by U.S. retailers, and to the more limited shipments of domestic and

Chinese wooden bedroom furniture by U.S. producers and importers to retailers related to the suppliers.

Note: Although not clearly visible in figure II-1 due to scaling, shipment data for the domestic and imported Chinese

wooden bedroom furniture were reported for all five categories of customers.

Source: Compiled from data submitted in response to Commission questionnaires.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 5 U.S. shipments of domestic wooden bedroom furniture to related customers, which involved only retailers and

were included in this figure, represented *** percent of the value of total shipments of the domestic furniture to all

retailers. 

 6

 All other customers of responding U.S. producers included distributors; health care facilities; federal, state, and

local government facilities; and employees of the U.S. furniture producers. Based on the value of shipments of the

domestic wooden bedroom furniture requested of U.S. producers elsewhere in the questionnaires, by type of

customer for 2002, distributors accounted for 2.0 percent of total reported U.S. shipments of domestic wooden

bedroom furniture.

 7

 U.S. petitioning producers reported that 91.7 percent of the value of their total U.S. shipments of domestic

wooden bedroom furniture during this period was to retailers, 6.6 percent was to the hospitality sector, 0.5 percent

was to furniture rental firms, and 1.1 percent was to all other types of customers.

 8

 All other customers of responding U.S. importers included distributors, accommodations, catalogue sales, and

employees of the U.S. furniture importers. Based on the value of shipments of the imported Chinese wooden

bedroom furniture requested of U.S. importers elsewhere in the questionnaires, by type of customer for 2002,

distributors accounted for 1.4 percent of total reported U.S. shipments of imported Chinese wooden bedroom

furniture.

 9

 Nine of the 46 responding U.S. importers are retailers of wooden bedroom furniture.

 10 The questionnaires requested that U.S. producers and importers discuss the importance of obtaining slots in

retailers’ stores in selling their domestic and imported Chinese wooden bedroom furniture. The responding firms

were also asked to discuss the impact of internet sales and catalogue sales of wooden bedroom furniture on the use

of slots in retail stores and the factors considered by retailers when deciding on which suppliers to purchase from.

 11 The lone exception was ***, a U.S. retailer of wooden bedroom furniture, which reported that the firm did not

use slots to sell wooden bedroom furniture.

II-3

U.S. producers reported that 90.0 percent of their total U.S. shipments of domestic wooden

bedroom furniture was shipped to retailers,5

 4.9 percent to the hospitality sector, 2.4 percent to furniture

rental firms, and 2.6 percent to all other types of customers during January 2000-June 2003.6

 Petitioning

U.S. producers accounted for 52.4 percent of the total value of all the reported shipments of domestic

wooden bedroom furniture by type of customer,7

 and for 70.1 percent of U.S. producers’ reported

shipments of the domestic wooden bedroom furniture to the hospitality sector during this period.

 U.S. importers reported that 97.3 percent of their total U.S. shipments of Chinese wooden

bedroom furniture was shipped to retailers, *** percent was to the hospitality sector, 1.1 percent was to

furniture rental firms, and *** percent was to all other types of customers during January 2000-June

2003.8

 U.S. retailers that imported the Chinese wooden bedroom furniture accounted for 26.6 percent of

the total value of all the reported shipments of imported Chinese wooden bedroom furniture by type of

customer, and for 27.4 percent of all U.S. importers’ reported U.S. shipments to retailers during this

period. Responding U.S. producers that imported the Chinese wooden bedroom furniture accounted for

33.4 percent of the total value of all the reported shipments of Chinese wooden bedroom furniture by type

of customer during January 2000-June 2003, while petitioning U.S. producers accounted for 8.6 percent.

MARKET CHARACTERISTICS

U.S. retailers of wooden bedroom furniture frequently display furniture suites in their stores, with

a certain number of floor areas, called slots, for each suite. All 40 U.S. producers and 45 of 46 U.S.

importers,9

 responding to questionnaire requests for information regarding the importance and use of slots

at U.S. furniture retailers,10 reported that access to retailer slots was critical in their sales of the domestic

and imported Chinese wooden bedroom furniture.11 Many of these responding firms noted the 

importance of physically displaying wooden bedroom furniture because consumers prefer to touch and
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 12 Primarily for this reason, 20 of the 25 U.S. producers and 19 of the 21 U.S. importers commenting on internet

and catalogue sales reported that such sales did not significantly affect retail store sales of wooden bedroom

furniture; another factor reportedly limiting internet and catalogue sales of wooden bedroom furniture was the high

cost of freight. The remaining five U.S. producers and two U.S. importers indicated that internet and catalogue sales

were generally made only after the consumer saw the wooden bedroom furniture at a retail store. ***, a petitioning

U.S. producer, reported that wooden bedroom products available in its catalogue, but not displayed on the retail

floor, do not generate as much sales as those displayed.

 13 ***, a petitioning U.S. producer, asserted that it is expensive for retailers to “change-out” slots on their floors,

especially the larger retailers with multiple stores or the larger single stores. The replaced floor samples,

mismatched inventory, and excess stock inventory often must be sold at deeply discounted prices. A new suite of

floor samples must be purchased and displayed along with new inventory for that product. Thus the incentive to

replace slots must be great.

 14 *** is opposed to the petition.

 15 *** reported that the firm is currently purchasing its own retail space to display better its wooden bedroom

furniture in geographic areas where its products are not adequately represented by existing retail relationships.

 16 Twenty of the 75 responding U.S. importers are retailers of wooden bedroom furniture; 14 responded that

significant changes had occurred and six reported that no changes had occurred.

II-4

explore the furniture prior to purchase.12 ***, a petitioning U.S. producer, asserted that a consumer must

see and touch the furniture before purchasing it, because wooden bedroom furniture is a big-ticket,

infrequent, deferrable purchase. This firm noted that seeing the furniture in person affords consumers the

peace of mind that a product meets their quality standards of finish color/consistency, construction,

overall scale, and utility within their homes.

The responding U.S. producers and importers generally reported that retailers award slots to

specific suppliers of wooden bedroom furniture based on a variety of factors, including, price, design,

style, brand-name recognition, service, and both promptness and reliability of delivery. According to the

responding firms, wooden bedroom furniture products may remain on a dealer floor for only a few

months or a number of years. Retailers generally do not agree with the supplier to display a specific

product for some predetermined period of time; ***, petitioning U.S. producers, asserted that if the

product does not meet the retailer’s rate of sales expectation within one to six months, it is replaced.13

According to ***, the *** of wooden bedroom furniture and an importer of the Chinese furniture,14

retailers attempt to award slots for the wooden bedroom furniture that will generate the most sales per

square foot of retail selling space. This U.S. producer asserted that product price is not always a

determining factor, because its experience has shown that furniture with strong brand-name recognition

and furniture sold through dedicated retail space both have a greater potential for sales per square foot of

retail space than non-branded products sold in a general retail environment.15 ***, a non-petitioning U.S.

producer and importer of Chinese wooden bedroom furniture, asserted that wooden bedroom furniture

competes for retail floor space against other bedroom furniture, dining-room furniture, televisions,

entertainment centers, and other electronics.

Forty-four U.S. producers and 75 U.S. importers of the domestic and Chinese wooden bedroom

furniture responded to a questionnaire request for information on any significant changes in the product

range or marketing of wooden bedroom furniture in the United States during January 2000-June 2003. 

Twenty-six U.S. producers and 42 U.S. importers reported at least some changes, whereas 18 U.S.

producers and 33 U.S. importers responded that there were no changes.16 Eight of the 26 U.S. producers

reporting changes asserted that product life cycles for wooden bedroom furniture had become shorter
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 17 ***, a petitioning U.S. producer, reported that since 2000 the firm has introduced ***. This U.S. producer

reported that it has had as many new offerings in the *** that it had available in its *** of business.

 18 On the other hand, ***, a U.S. importer of Chinese wooden bedroom furniture that sells to retailers, asserted

that as the U.S. economy has slowed, the pressure to have wooden bedroom furniture suites that can retail under

$1,000 has intensified.

 19 According to ***, such control over design and marketing limited the variety of products, giving the U.S.

furniture producers control over their selling prices. 

 20 By 1995, *** reportedly began designing its private brand wooden bedroom furniture and began hosting

consumer focus groups to help the firm design furniture that the consumer wants to buy. Currently, *** purchases

wooden bedroom furniture from producers in *** that has worked closely with this retailer since 1995. Such

diversification of suppliers reportedly allows *** to take the findings from its consumer focus groups and locate the

ideal supplier to produce the items demanded by consumers.

II-5

because of more frequent product introductions during this period.17 All eight U.S. producers were

petitioners and asserted that the shorter product life cycles have occurred because the Chinese and other

imports have copied their designs and priced the imported products below the U.S. producers’ costs. 

Sixteen of the 42 U.S. importers reporting changes asserted that the variety of wooden bedroom furniture

products increased, including more ornate designs and intricate carvings, during January 2000-June 2003. 

***, a U.S. retailer, reported that since 2000, its range of wooden bedroom furniture products offered in

the United States has expanded to include more intricately designed suites (requiring significantly more

hand work) with more detailed carvings and more sophisticated wood finishes. *** asserted that this had

been due almost exclusively to the imports of wooden bedroom furniture from China and other Asian

countries. This retailer noted that since bedroom furniture styles have become more interesting during

this period, it has been able to increase its price points because customers are willing to pay more.18 

Two other U.S. importers, ***, both retailers of furniture, responded that significant changes had

occurred in the product range and marketing of wooden bedroom furniture in the United States during

January 2000-June 2003. These two firms reported that they have largely switched to selling privatebrand wooden bedroom furniture exclusive to each firm. *** asserted that until about 10 years ago, the

U.S. supply and distribution of wooden bedroom furniture was controlled by a relatively small number of

U.S. producers with their national-brand products designed and produced by the U.S. producers and

marketed primarily through specialty furniture and department stores.19 They reportedly would not

produce private brand wooden bedroom furniture for retailers, including mass merchandisers like ***. 

*** began switching to private brand furniture in the 1980s by sourcing these products from furniture

producers in Malaysia, Mexico, the Philippines, and Taiwan; by 1995, many Taiwan furniture producers

reportedly had moved to China and *** began sourcing more of its products from Chinese producers.20

*** adopted this strategy of developing its private brands of wooden bedroom furniture in 2002, and

reportedly after repeated failed attempts to get U.S. producers to supply these products, it found the

Chinese producers willing and capable of doing so. 

***, a U.S. importer of the Chinese wooden bedroom furniture that sells to retailers, also cited

some changes in the marketing and product range of products during January 2000-June 2003. The firm

asserted that brand-name wooden bedroom furniture appears to have become less important to the

consumer, while the firm sees more use of all-metal beds, mirrors, and nightstands.

Four other U.S. importers of the Chinese wooden bedroom furniture, including one that is a U.S.

retailer, also cited changes in the product range and marketing of wooden bedroom furniture in the U.S.

market during January 2000-June 2003, which were similar to each other. ***, the U.S. furniture retailer,

summed up the collective remarks of all four of these U.S. importers. Chinese furniture producers
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 21 Manufacturing wages in China average $0.61 per hour compared with $16.00 per hour in the United States and

$2.00 per hour in Mexico (Mr. Michael Cox and Jahyeong Koo, Chief economist and economist, respectively, at the

Federal Reserve Bank of Dallas, China Is No Threat to America, Financial Times, October 28, 2003). Respondents

asserted that the Chinese wage rate for wooden bedroom furniture production is closer to $*** per hour, while

petitioners asserted that the average wage rate for domestic wooden bedroom furniture production was about $***

per hour (staff meeting with ***; staff conversation with ***; and based on data received in response to Commission

questionnaires). Petitioners asserted that the labor cost advantage in China vis-a-vis the United States was wholly

irrelevant to the Commission’s statutory inquiry, but then noted that such an advantage was relevant in that it

reportedly constitutes an implicit admission that imports from China are being sold on the basis of lower price. See

petitioners’ postconference brief at 37-38).

 22 *** reported in its questionnaire response that *** domestic production and imports of wooden bedroom

furniture, including that from China, during January 2000-June 2003; this suggests that imports of Chinese wooden

bedroom furniture, at least for this producer, are complementary and not direct substitutes in supply. According to

***, wooden bedroom furniture styles containing certain design elements, such as detailed hand carvings or intricate

veneer processes, lend themselves more to imports, because of their greater labor intensity. Certain other designs,

particularly those involving multiple choices in color and finish, or shorter production runs, lend themselves more to

domestic production. This U.S. producer decides on an item-by-item basis whether to produce domestically or to

import the wooden bedroom furniture products. *** asserted that, among the production factors of labor, natural

resources, and capital, the only substantial difference among domestic and foreign producers of wooden bedroom

furniture is the cost of labor. Raw materials are generally comparable from one country to another and machinery is

globally sourced.

 23 Rooms-To-Go is reportedly the largest U.S. retailer of furniture. See testimony of Mr. Jeffrey Seaman,

President & CEO, Rooms-To-Go, conference transcript at 149.

II-6

reportedly have upgraded their facilities with state-of-the-art equipment to offer unique product styling in

all design categories that meet their customers’ needs. Timely delivery is the core of each of these firm’s

fulfillment programs and, combined with reliable consistent quality, is reportedly rare from any other

country source of wooden bedroom furniture, including many U.S. producers. Timely delivery and

consistent quality, more than any other factor, reportedly made Chinese furniture producers attractive to

these four U.S. importers, and enabled them to become complete, one-stop, home furnishing sources for

their customers.

***, a U.S. importer of Chinese wooden bedroom furniture for youths (3-18 years old) that sells

to U.S. retailers, asserted that this category of wooden bedroom furniture is now growing because it can

obtain products from China that are designed specifically for children. According to ***, U.S. producers

mainly resize adult furniture and sell it for children.

SUPPLY AND DEMAND CONSIDERATIONS

The degree of substitution in U.S. producers’ supply to the U.S. market between U.S.-produced

and imported Chinese wooden bedroom furniture depends upon such factors as relative costs, range of

products, styles and designs, and availability of materials and labor. Based on the reported information in

the preliminary phase of the investigation, comparative advantages in China, particularly in low labor

costs to produce more intricate styles and design of furniture,21 may limit the degree of substitution in

supply between the U.S.-produced and imported Chinese wooden bedroom furniture.22 Conference

testimony by respondents, including Rooms-To-Go and Furniture Brands International,23 revealed that if

antidumping duties are imposed on Chinese wooden bedroom furniture, the largest U.S. retailer of

furniture and the largest U.S. producer of wooden bedroom furniture, respectively, would switch sourcing

of their wooden bedroom furniture products from China to other countries such as Brazil, Indonesia,
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 24 See testimony of Mr. Jeffrey Seaman, President & CEO, Rooms-To-Go, and Mr. Lynn Chipperfield, Senior

Vice President and Chief Administrative Officer, Furniture Brands International, conference transcript at 157 and

173, respectively.

 25 See testimony of Mr. John Greenwald, counsel to respondents, conference transcript at 148 (referencing a taped

telephone conversation between Rooms-To-Go and Lea Industries that was played at this point in the conference).

 26 Greenspan Plays Down China’s impact on U.S. Jobs, Alan Beattie, Financial Times, December 12, 2003; Shift

by China Might Not Aid U.S. Industry, Fed Chief Says, Keith Bradsher, The New York Times, December 12, 2003;

and Fed Chief Rebuffs Complaints on Yuan, Greg Ip, The Wall Street Journal, December 12, 2003.

 27 *** sells only imported wooden bedroom furniture to U.S. retailers.

 28 Ten of the 25 U.S. producers responding “No” also commented, generally asserting that they could produce the

wooden bedroom furniture products that they or others import from China, but much lower prices of the imported

Chinese furniture do not make it practical to produce such products domestically. All 10 of these U.S. producers

were petitioners.

II-7

Malaysia, Thailand, and Vietnam.24 In addition, Lea Industries, a petitioning U.S. furniture producer,

indicated that, if antidumping duties are imposed on the Chinese products, the U.S. producer had already

arranged to switch its current imports of wooden bedroom furniture from China that it supplies to RoomsTo-Go to imports from Vietnam to maintain the low price structure to its customer.25 Recently, Alan

Greenspan of the U.S. Federal Reserve commented that any rise in the value of the yuan vis-a-vis the U.S.

dollar would be unlikely to have much, if any, effect on aggregate U.S. employment, because any loss in

competitiveness by China as a result of a stronger yuan would be replaced by increased imports from

other low-wage economies.26

On the other hand, unique production capabilities in a particular country might hinder, at least

somewhat, the ease of moving production from one country to another. *** is a U.S. importer of Chinese

and third-country sources of wooden bedroom furniture and is located in ***.27 The firm reported in its

questionnaire response that it selects its foreign supply source for a particular design, including wooden

bedroom furniture, based on the capabilities of the supplier. *** indicated that the species of lumber used

in producing wooden furniture is one basis for choosing a supply source. According to the firm, it is

more advantageous to purchase oak products from China because of the country’s plentiful supply of oak

timber, but Malaysia is a good source for products made with rubber wood. Type of products is a second

factor considered by *** in choosing a supply source. According to the firm, Chinese wooden furniture

producers use non-finger-jointed construction techniques, and are well ahead of their counterparts in other

countries such as Malaysia, Thailand, and Vietnam in using these techniques. Quality standards and

technical capability is a third factor considered by *** in choosing a supply source, and production

capacity and labor supply is a fourth factor. According to the firm, furniture factories in China are

generally much bigger in size than their counterparts in Indonesia, Malaysia, Thailand, and Vietnam. In

addition, Chinese factories reportedly will not face the problem of labor shortages as they expand output,

whereas furniture factories in Malaysia need to import labor from other countries to meet the demand.

U.S. producers and importers were requested in the questionnaires to report whether there were 

any types/styles of wooden bedroom furniture that they did not produce domestically/did not import from

China that, respectively, was imported from China or produced domestically. A total of 42 U.S.

producers and 63 U.S. importers responded, with 25 U.S. producers and 32 importers reporting “No” (that

all styles/designs were produced domestically and imported from China).28 On the other hand, 17 U.S.

producers and 41 U.S. importers reported “Yes” and most provided comments, as requested, that certain

types/styles of wooden bedroom furniture were not produced domestically or imported from China. Nine

of these 17 U.S. producers reported that they do not produce domestically any of the complex, labor-
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 29 One of these latter nine firms, ***, a petitioning U.S. producer located in ***, reported that the wooden

bedroom furniture designs the firm produces domestically are relatively simple. *** reported that it did not have

machining capabilities or low-cost labor to pursue introductions of high-detailed, ornate-designed wooden bedroom

furniture.

 30 ***, an importer of Chinese wooden bedroom furniture located in ***, explained that U.S., Canadian, and

Mexican furniture producers have a competitive production advantage and a competitive cost of freight advantage

that make this furniture undesirable to import from China, especially when containers are more expensive now than

ever before.

 31 Abundance of rubber wood and quality of workmanship reportedly allow these products to be produced most

efficiently in Thailand.

 32 Dr. John Reilly, economic consultant for the respondents, asserted that the domestic price elasticity of supply

likely ranges from 10 to 15, but this was based on lower domestic capacity utilization rates than those in table III-2

of the staff report and also on fairly constant marginal costs as production increased. See postconference brief of 

(continued...)

II-8

intensive, veneer and carved furniture pieces.29 Another U.S. producer, ***, reported that it only

produced domestically unfinished, ready-to-assemble, wooden bedroom furniture at lower price points for

the do-it-yourself consumer. Another U.S. producer, ***, reported that it produced laminated medium

density fiberboard furniture more efficiently and cheaply than can be produced and exported from China

to the United States. Another U.S. producer, ***, reported that it produced only rustic country (cratestyle) furniture. Another U.S. producer, ***, reported that it produced only solid pine, early

American/country bedroom suites very well, and imported the other product styles, such as European,

traditional, contemporary, Louis Philippe, Mission, Cherry suites, ash suites, marble and wood suites, and

oak suites. Three nonpetitioning U.S. producers of wooden bedroom furniture, ***, reported that the

firms use blended programs of producing domestically and importing wooden bedroom furniture,

including furniture from China, to supplement and complement their domestic product offerings.

The 41 U.S. importers reporting that they did not import some styles/designs of wooden bedroom

furniture that are produced in the United States, included the following styles/designs of wooden bedroom

furniture produced domestically or, as noted, imported from third countries, but not imported from China:

(1) straight-line/simple designs, with fewer carvings, less hand work, and sometimes less sophisticated

wood finishes; (2) high and low-pressure laminated wooden bedroom furniture, such as paper and vinylwrapped, acrylic-coated, and/or Formica or Formica-like products;30 (3) larger, less labor-intensive

products, which are cost and freight prohibitive from China; (4) promotional bedroom furniture made of

particleboard and paper veneer; (5) solid pine youth and master bedroom furniture, which is imported

more cheaply from Brazil; (6) wicker master bedroom furniture from Indonesia; (7) solid rubber wood

youth bedroom sets from Thailand;31 (8) acrylic, paper, and wood veneers over medium-density

fiberboard, some with solid wood accents and/or drawer fronts, which reportedly are generally low-end

products; (9) ready-to-assemble furniture; (10) both Louis Philippe and Mission styles of wooden

bedroom furniture, which can be shipped more quickly from Mexico; (11) very high-end wooden

bedroom furniture; (12) wooden bedroom furniture that is cheap or very expensive but is materialintensive, has low-labor content, and/or that involves low-volume production runs; and (13) mahogany

furniture.

U.S. Supply

Based on available information, U.S. producers have the ability to respond to changes in demand

with moderate-to-large changes in shipments of their U.S.-produced wooden bedroom furniture to the 

U.S. market.32 The main factors contributing to this degree of responsiveness are available unused
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 32 (...continued)

Furniture Retailers Group at exh. 16, pp. 2-3.

 33 Domestic capacity utilization for wooden bedroom furniture based on pounds of wooden bedroom furniture

produced declined irregularly during the period, falling from 78.9 percent in 2000 to 72.0 percent in 2002. Data for

interim periods show a continuation of this decline in capacity utilization, from 74.4 percent in January-June 2002 to

72.4 percent in the same period of 2003. 

 34 Thirty-five U.S. producers of wooden bedroom furniture reported the requested cost data. Twenty-two of the

responding U.S. producers were petitioners, whose variable costs averaged 81.6 percent of their total production

costs during January 2000-March 2003, while their fixed costs averaged 18.4 percent.

 35 Costs of direct labor, materials, and utilities accounted for the bulk of variable costs, whereas salaried workers,

depreciation, insurance, and property taxes accounted for much of the fixed costs.

II-9

capacity, some existing inventories, and ability to shift production between wooden bedroom furniture

and other types of wooden furniture. However, other factors, such as the lack of alternate markets and the

ability to produce competitively wooden bedroom products that are very labor intensive, tend to moderate

this degree of responsiveness. The relevant supply factors are discussed below.

Industry Capacity

As noted in Part III, reported capacity and production data of U.S. producers of wooden bedroom

furniture were based on quantity data that were best estimates and not provided by all firms. As a result,

the capacity utilization figures calculated from these data should be used carefully. Data reported by U.S.

producers indicated that there is some excess capacity with which U.S. producers could expand

production in the event of price changes. Domestic capacity utilization for wooden bedroom furniture

based on the number of furniture pieces produced declined steadily during the period, falling from 82.7

percent in 2000 to 75.4 percent in 2002. Data for interim periods show a continuation of this decline in

capacity utilization, from 79.1 percent in January-June 2002 to 75.4 percent in the same period of 2003.33 

U.S. producers reported variable costs that averaged 76.4 percent of total production costs of domestic

wooden bedroom furniture during January 2000-June 2003, while fixed costs averaged 23.6 percent.34

The importance of variable costs suggests that low output levels would not lead to significantly increased

unit output costs.35

Inventory Levels

Available data on the quantity of U.S. producers’ inventories of wooden bedroom furniture are

subject to the same limitations as the U.S. production and production capacity data. Based on the data

reported on the basis of pieces or pounds, inventories appeared moderate and relatively stable during

January 2000-June 2003 (table III-5).

Export Markets

During the period for which data were collected, exports were not a significant outlet for U.S.

producers of wooden bedroom furniture. The value of exports of wooden bedroom furniture accounted

for about 1.6 percent of U.S. producers’ total shipment value of domestic wooden bedroom furniture

during January 2000-June 2003. These numbers suggest that there is little, if any, ability for U.S.

producers to divert shipments of wooden bedroom furniture to or from alternate country markets in

response to changes in the price of wooden bedroom furniture. Furthermore, U.S. producers provided

narrative information on their ability to shift sales of their U.S.-produced wooden bedroom furniture

between the U.S. market and foreign country markets. U.S. producers reported that there is little export
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 36 Dr. John Reilly, economic consultant for the respondents, asserted that import supply elasticity for the Chinese

wooden bedroom furniture likely ranges from 10 to 20. See postconference brief of the Furniture Retailers Group at 

exh. 16, p. 3. 

 37 China’s Not Overheating, It’s Wasting Capital, The Wall Street Journal, December 22, 2003, p. A15.

 38 Asia’s Forests Head to China, The Wall Street Journal, December 23, 2003, p. A10 and A12.

 39 This figure is based on U.S. customs values for HTS statistical reporting numbers 9403.50.9040 and

9403.50.9080. The use of landed, c.i.f., duty-paid values would result in a higher share of the imports from China

than that based on customs values, because the former values would include significant transportation charges for

shipping Chinese wooden bedroom furniture to the U.S. ports-of-entry that are much higher than those of other large

suppliers such as Canada and Mexico.

 40 These figures are based on U.S. customs values for HTS statistical reporting numbers 9403.50.9040 and

9403.50.9080.

II-10

opportunity due to high transportation costs, differences in furniture styles and designs in many other

countries, and the need for recognized brand names and a sales force in any country to which they would

export. In addition, several U.S. producers asserted that the United States is the largest consuming

country of wooden bedroom furniture, thus it is not economical for U.S. producers to shift to these other

markets.

Subject Imports

Based on available information, the Chinese producers have the ability to respond to changes in

the price of wooden bedroom furniture with significant changes in the quantity of shipments of Chinese

wooden bedroom furniture to the U.S. market.36 The main factors contributing to this degree of

responsiveness is the readily available investment capital to expand Chinese production capacity for

wooden bedroom furniture and an ample labor supply,37 and some excess production capacity. This

supply responsiveness may be tempered somewhat by the reported increases in furniture sales in China

and demand pressure that China has been placing on the world’s supply of timber as its imports of this

product have reportedly soared in the last few years.38

China was the largest single country supplier of wooden bedroom furniture to the U.S. market

during much of January 2000-June 2003, accounting for 34.4 percent of the total value of such imports

during this period.39 U.S. imports of wooden bedroom furniture from China increased by $458.6 million

during 2000-02 and by an additional $178.1 million in January-June 2003 from the same period in 2002.40

Industry Capacity

The production and production capacity data reported by Chinese producers of wooden bedroom

furniture appear to be subject to the same limitations as such data reported by U.S. producers. As a result,

the capacity utilization figures for Chinese producers calculated from these data should be used carefully. 

Data reported by Chinese producers indicate that there is limited excess capacity with which they could

expand production in the event of price changes. Chinese capacity utilization for wooden bedroom

furniture based on number of furniture pieces produced fluctuated during the period, rising irregularly

from 91.6 percent in 2000 to 95.6 percent in 2002 and then falling somewhat during the interim periods,

from 86.2 during January-June 2002 to 85.8 percent during January-June 2003.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 41 Dr. John Reilly, economic consultant for the respondents, asserted that a U.S. import supply elasticity for

wooden bedroom furniture from nonsubject countries is likely infinite. See postconference brief of the Furniture

Retailers Group at exh. 16, pp. 3-4.

 42 In this part of the report, values of imported wooden bedroom furniture from different countries are based on

U.S. customs values for HTS statistical reporting numbers 9403.50.9040 and 9403.50.9080.

II-11

Alternate Markets

As shown in table VII-1, China consistently exported more than 90.0 percent of its total

production of wooden bedroom furniture, based on the number of furniture pieces, during January 2000-

June 2003, with the United States accounting for most of these exports. These quantity figures appear to

be subject to the same limitations as such quantity data reported by U.S. producers and should be viewed

carefully. These data indicate that the producers of wooden bedroom furniture in China have limited 

flexibility to use alternate country markets to increase or decrease shipments to the U.S. market in

response to price changes in the U.S. market. 

Nonsubject Imports

The large number of nonsubject countries that supply wooden bedroom furniture to the U.S.

market, suggest that the supply responsiveness of these sources appears to be quite large.41 

Although 109 countries supplied wooden bedroom furniture to the U.S. market during January 2000-June

2003, the supply of foreign produced wooden bedroom furniture remained concentrated among a few

countries during this period. Together China and Canada accounted for 56.6 percent of the total value of

all such imports during January 2000-June 2003.42 The top five country suppliers, which also included

Italy, Mexico, and Indonesia, in descending order, accounted for 80.0 percent of the value of all U.S.

imports of wooden bedroom furniture during this period. The top 10 country suppliers, which also

included Brazil, Taiwan, Malaysia, Denmark, and Thailand, in descending order, accounted for 91.4

percent of the value of all such U.S. imports during this period; the remaining 99 countries accounted for

8.6 percent of the total value of all such U.S. imports during this period.

U.S. imports of wooden bedroom furniture from Canada and Mexico, the second and fourth

largest foreign country suppliers of wooden bedroom furniture to the United States, fell by a total of

$54.1 million during 2000-02 and by another $22.6 million in January-June 2003 from the same period in

2002. On the other hand, U.S. imports of wooden bedroom furniture from Indonesia, Brazil, Malaysia,

and Thailand, the fifth, sixth, eighth, and tenth respective largest foreign country suppliers of wooden

bedroom furniture to the United States, increased by a total of $100.4 million during 2000-02 and by

another $26.7 million in January-June 2003 from the same period in 2002. Although still a small supplier

of wooden bedroom furniture to the U.S. market, U.S. imports of these products from Vietnam increased

by total of $8.5 million during 2000-02 and by another $11.6 million in January-June 2003 from the same

period in 2002.

U.S. Demand

Overview

Aggregate U.S. demand for wooden bedroom furniture depends on many factors, but, based on

questionnaire responses of U.S. producers and importers, appears primarily affected by general economic

activity, the level of activity in the market for new-housing, home-mortgage interest rates, and shifts in

consumer tastes for different styles and designs of wooden bedroom furniture that manifest itself in
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 43 The questionnaires specifically requested that the responding firms comment on any business cycles, seasonal

factors, product cycles, and/or conditions of competition distinctive to this industry that affects aggregate U.S.

demand for wooden bedroom furniture.

 44 Four of the 14 responding U.S. producers and six of the 26 responding U.S. importers commenting on general

U.S. economic activity during January 2000-June 2003 noted that the general malaise of the U.S. economy since

about mid-2000 has tended to discourage U.S. demand for wooden bedroom furniture for most of this period. 

 45 In addition to spurring demand for new housing, generally declining home-mortgage interest rates during much

of January 2000-June 2003 led to a significant amount of mortgage refinancing on existing homes. This, in turn,

increased incomes of many homeowners, which would have tended to encourage U.S. demand for wooden bedroom

furniture during this period.

 46 Eight of the 17 responding U.S. producers and five of the 13 responding U.S. importers noted the generally low

interest rates and robust levels of new housing starts during January 2000-June 2003; these factors would tend to

encourage U.S. demand for wooden bedroom furniture during this period.

 47 According to ***, a petitioning U.S. producer, demand for wooden bedroom furniture falls early in an

economic downturn and rises late in an upturn, because its purchases can easily be postponed.

II-12

product cycles of varying lengths. In addition, seasonal factors result in some variations in demand for

wooden bedroom furniture within a calendar year.

Forty-four U.S. producers and 66 U.S. importers responded to a request in their questionnaires for

a discussion of factors affecting aggregate U.S. demand for wooden bedroom furniture during January

2000-June 2003.43 Thirty-eight U.S. producers and 54 U.S. importers reported on at least one factor,

whereas the remaining six responding U.S. producers and 12 U.S. importers reported that no such factors

existed. Fourteen responding U.S. producers and 26 responding U.S. importers specifically identified the

condition of the U.S. economy as an important factor,44 and 17 responding U.S. producers and 13 U.S.

importers specifically identified interest rates45 and the housing industry as important factors affecting

aggregate U.S. demand for wooden bedroom furniture.46 Both residential consumer demand and

hospitality demand for wooden bedroom furniture reportedly were adversely affected by the downturn in

the U.S. economy.47 *** asserted that beginning in May or June 2000 and lasting through June 2003, the

U.S. furniture industry experienced a cyclical downturn that has been the deepest and most sustained in

the memory of most furniture veterans. The downturn reportedly began with middle-price product lines

in mid-2000 and was followed by upper-price lines at the end of that year.

Demand Trends

U.S. aggregate demand for wooden bedroom furniture, as measured by the value of U.S. apparent

consumption, fluctuated but rose during January 2000-June 2003. The value of apparent consumption of

wooden bedroom furniture fell from almost $4.2 billion in 2000 to almost $4.1 billion in 2001, or by 3.1 

percent on an unrounded basis, then rose to almost $4.4 billion by 2002, or by 8.3 percent on an

unrounded basis from the level in the previous year and 4.9 percent higher than the level in 2000. Interim

data show a continuing increase in apparent consumption of 3.4 percent in January-June 2003 from the

level in January-June 2002.

U.S. real gross domestic product (GDP), a popular U.S. economy-wide measure of economic

activity, has grown slowly during January 2000-June 2003, and the U.S. economy actually contracted

during the first three quarters of 2001. U.S. real GDP grew by 3.8 percent in 2000 from the previous

year, but owing to the recession for much of 2001, grew by only 0.3 percent in 2001 from the level in
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 48 These growth rates are seasonally adjusted annual rates based on U.S. real GDP in billions of constant 1996

dollars (Blue Chip Economic Indicators, Aspen Publishers, December 10, 2003, p. 2).

 49 Blue Chip Economic Indicators, Aspen Publishers, December 10, 2003, pp. 2-3.

 50 Ibid. All of these housing start figures are all higher than the 1.51 million average annual U.S. housing starts

during 1995-1999.

 51 Based on simple averages of U.S. monthly contract interest rates on conventional single-family mortgages for

all homes (Federal Housing Finance Board, http://www.economagic.com/em-cg1/data.exe/thtb/m1rs_19c03).

II-13

2000.48 In 2002, U.S. real GDP grew by 2.4 percent, and is forecast to grow by 3.1 percent in 2003 and

4.4 percent in 2004.49 New U.S. housing starts remained historically high during January 2000-June

2003, rising steadily from 1.57 million in 2000 to 1.71 million by 2002, or by a total of 8.9 percent, and

are expected to increase to 1.79 million in 2003, but drop off somewhat to 1.70 million in 2004.50 U.S.

monthly home-mortgage interest rates generally fell during January 2000-June 2003 from an average of

7.84 percent during 2000 to 6.46 percent during 2002 and 5.70 percent during January-June 2003.51

Product Cycles

Eight responding U.S. producers and 21 responding U.S. importers asserted that the U.S. market

for wooden bedroom furniture was affected by product cycles and/or style and design changes, which

could last as short as 6 months or as long as 10 years; these comments were directed to retail sales of

wooden bedroom furniture. According to ***, a U.S. importer of Chinese wooden bedroom furniture that

sells to retailers, and ***, a nonpetitioning U.S. producer and an importer of the Chinese wooden

bedroom furniture, the U.S. wooden bedroom furniture industry is a highly complex fashion industry,

driven by new product introductions. ***, two petitioning U.S. producers that commented on product

cycles, asserted that in the past three years product cycles for wooden bedroom furniture have been

severely shortened because of increased imports from China that copy U.S. producers’ new styles and

designs of wooden bedroom furniture. ***, a U.S. importer of Chinese wooden bedroom furniture that

sells to retailers, asserted that Mission and Louis Philippe styles of wooden bedroom furniture have

become outdated, while Contemporary and Cottage/Traditional styles have increased in popularity during

January 2000-June 2003. According to ***, certain domestic furniture producers have continued

emphasizing the Mission and Louis Philippe styles even though consumers appear to see them as older

designs.

Seasonal Factors

Nineteen responding U.S. producers and 23 responding U.S. importers asserted that seasonal

factors affect aggregate U.S. demand for wooden bedroom furniture within a calendar year, but mostly for

residential consumer demand and with less effect on hospitality demand or demand by furniture rental

firms for these products. Fourteen U.S. producers and 18 U.S. importers provided specific information on

the nature and timing of seasonal factors within a calendar year. The majority of these 32 firms indicated

that spring and fall were the strongest demand periods of the year for wooden bedroom furniture, while

December and the vacation summer months were the weakest periods of demand for this product. Several

firms noted that tax refunds and Mothers Day boosted demand for wooden bedroom furniture during the

spring, while the back-to-school months of September and October helped spur demand in the fall, which

then fell off by the entertaining holidays of Thanksgiving and Christmas.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 52 Dr. John Reilly, economic consultant for the respondents, identified two studies, albeit dated, that indicated the

U.S. price elasticity of demand for wooden bedroom furniture ranged from -1.3 to -3.0. See testimony of Dr. John

Reilly, consultant, Nathan Associates Inc., conference transcript at 206-207. In respondents’ postconference brief,

Mr. Reilly asserted that a reasonable estimate today for the U.S. price elasticity of demand for wooden bedroom

furniture is highly elastic and likely ranges from -1.8 to -2.3. See postconference brief of the Furniture Retailers

Group at exh. 16, p. 2. On the other hand, petitioners asserted that U.S. demand for wooden bedroom furniture was

not highly price elastic. See petitioners’ postconference brief at 21-22. One implication of a price elastic demand is

that lower prices of wooden bedroom furniture would lead to an increase in quantity demanded that otherwise would

not have occurred.

 53 Dr. John Reilly, economic consultant for the respondents, identified several substitutes for wooden bedroom

furniture, including high-end television sets, electronic games, personal computers, CD players, and furniture in the

second-hand market. See testimony of Dr. John Reilly, consultant, Nathan Associates Inc., conference transcript at

208. On the other hand, petitioners asserted that consumers do not regard items such as expensive appliances and

plasma televisions as substitutes for wooden bedroom furniture; they alleged that wooden bedroom furniture was a

necessity and the other items are not. See petitioners’ postconference brief at 21-22. ***, a petitioning U.S.

producer, asserted in its questionnaire response that for most consumers purchases of wooden bedroom furniture can

be postponed.

 54 Of the 53 responding U.S. importers, 16 are retailers of wooden bedroom furniture.

 55 Another 16 responding U.S. producers, ***, and 10 responding U.S. importers reported that new product

offerings and favorable financing offered by retailers was important, but these efforts did not increase U.S. demand

for wooden bedroom furniture. ***, one of the 16 responding U.S. producers, asserted that the U.S. bedroom

furniture industry is fashion driven with new product designs continually being introduced, but this did not

materially affect the level of U.S. demand for these products. Several of these 26 responding firms asserted that

sectoral and overall economic activity (level of housing starts and general economic conditions, respectively) were

more important in determining the level of U.S. demand for wooden bedroom furniture. The four remaining U.S.

(continued...)

II-14

Demand Characteristics

Based on available information, U.S. aggregate demand for wooden bedroom furniture is likely to

respond substantially to changes in prices of wooden bedroom furniture and to changes in income, the

latter discussed earlier in the demand section.52 The main factor contributing to this degree of price

sensitivity is the discretionary nature of demand for wooden bedroom furniture, an expensive, consumer

durable good, as noted in questionnaire responses. Although other constructions of new bedroom

furniture appear to be only somewhat substitutable for wooden bedroom furniture, used and antique

furniture, other types of furniture, other consumer products, and other discretionary expenditures, such as

vacations and home remodeling projects, all compete for the consumers’ discretionary expenditure

budget.53 In addition, because wooden bedroom furniture is a durable good that often lasts for many

years, if not decades, replacement purchases can be postponed for a very long period of time. Rentals of

wooden bedroom furniture can also substitute for purchases of new wooden bedroom furniture.

The discretionary nature of U.S. demand for wooden bedroom furniture has resulted in challenges

to U.S. producers, importers, and retailers in selling the domestic and imported Chinese products in the

U.S. market during January 2000-June 2003, a period encompassing a recession and generally slow

growth in the U.S. economy. A total of 36 U.S. producers and 53 U.S. importers responded to a request

in the questionnaires to discuss the impact of new product offerings and attractive retail payment terms on

the level of U.S. residential consumer demand for wooden bedroom furniture during January 2000-June

2003.54 Sixteen of the responding U.S. producers and 31 of the responding U.S. importers reported that

new product offerings of wooden bedroom furniture were very important in stimulating demand in what

several firms noted was a fashion-driven industry.55 According to ***, most furniture producers
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 55 (...continued)

producers and 12 U.S. importers that responded were unsure of the impact of new product offerings and favorable

consumer financing terms on U.S. demand for wooden bedroom furniture.

 56 ***, one of the responding U.S. importers of Chinese wooden bedroom furniture and a retailer of both the

domestic and imported Chinese products, commented that payment terms such as no payments for 12-15 months or

interest-free payments for 12-15 months generate a sense of urgency in the residential consumer and provide a

stimulus to consumer demand. 

 57 ***, another responding U.S. importer of Chinese wooden bedroom furniture that sells to retailers, commented

that financing and favorable payment terms at the retail level play a major role in consumers’ buying habits, because

wooden bedroom furniture is considered a big-ticket durable consumer good.

 58 Eleven of the 37 responding U.S. importers are retailers of wooden bedroom furniture.

 59 The remaining 20 U.S. producers and 26 U.S. importers reported that bedroom furniture constructed of other

materials was not a substitute for wooden bedroom furniture. Several of these 46 responding firms noted that other

products, especially metal furniture, are sold in the U.S. market, but did not feel that these latter products substituted

for wooden bedroom furniture.

II-15

introduce new collections twice each year–at the April and October furniture markets in High Point, NC. 

The 47 firms citing the importance of new product offerings also reported that favorable financing offered

by retailers, such as no interest and deferred payments,56 also stimulated demand for wooden bedroom

furniture.57 ***, a responding nonpetitioning U.S. producer and importer of the Chinese wooden

bedroom furniture that sells to retailers, also commented that attractive payment terms are essential, as

they are for any large purchase that consumers would alternatively make, such as motor vehicles,

electronics, and appliances. Three responding U.S. importers that included a nonpetitioning U.S.

producer, a retailer, and an importer that sells to retailers, asserted that without the availability of

imported wooden bedroom furniture, including that from China, it would not be possible with just U.S.-

produced products to introduce the number of new product lines necessary in the U.S. wooden bedroom

furniture market. According to ***, another responding U.S. importer of Chinese wooden bedroom

furniture and a retailer of furniture, absent increasingly stylish wooden bedroom furniture (with more

intricate carvings and sophisticated wood finishes), customers will simply decide to direct their

discretionary expenditures on something else.

Substitute Products and Expenditures

This section discusses separately substitution in demand in the U.S. market during January 2000-

June 2003 for the following: (1) substitute products and alternative expenditures vis-a-vis wooden

bedroom furniture and (2) substitution among the various types, styles, and designs of wooden bedroom

furniture. This discussion is based on replies of U.S. producers and importers of wooden bedroom

furniture, including that from China, to requests for this information in their questionnaire responses.

Substitute products and alternative expenditures vis-a-vis wooden bedroom furniture

Thirty-five U.S. producers and 63 U.S. importers of the domestic and imported Chinese wooden

bedroom furniture reported useable information regarding substitution in demand in the retail market 

between wooden bedroom furniture and bedroom furniture constructed of materials outside the scope of

wooden bedroom products specified in the petition. Fifteen of the responding U.S. producers and 37 of

the responding U.S. importers reported that bedroom furniture constructed of other materials substituted,58

at least sometimes, for the wooden bedroom furniture.59 Reported most frequently by the 52 responding

firms affirming some substitution were metal beds (headboards, footboard, and bed rails), mirrors, and

occasional tables (instead of nightstands), followed by bedroom furniture made of wicker, ratan, bent-
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 60 These five firms included two U.S. producers and three U.S. importers of the domestic and imported Chinese

wooden bedroom furniture, with two of the latter firms also retailers of wooden bedroom furniture.

 61 *** also asserted that many new homes have empty bedrooms and buying new bedroom furniture can easily be

postponed, even when the bedroom is empty.

 62 The remaining 11 U.S. producers and 5 U.S. importers reported that demand for rental furniture was a separate

market from consumer purchases of new wooden bedroom furniture, such that no substitution existed between the

two markets. 

 63 A single U.S. producer and five U.S. importers also commented on substitution between rental furniture and

purchases of new wooden bedroom furniture in the hospitality sector. Four of the five responding firms reported that

no such substitution existed, whereas the one remaining firm indicated that such substitution existed. 

II-16

wood, plastic, bamboo, canvas, and leather, and bedroom furniture of mixed media, including upholstery,

stone, metal, glass, and granite. In addition, futons were mentioned as a substitute for wooden beds and

custom-built furniture as a substitute for the high-end of factory-built domestic and imported Chinese

wooden bedroom furniture. Twelve of the 16 U.S. producers and 27 of the 36 U.S. importers that

commented on the price sensitivity of substitution between wooden bedroom furniture and bedroom

furniture of other constructions reported that it was weak. Three other U.S. producers and four other U.S.

importers reported that such price sensitivity was moderate, three other U.S. importers reported that such

price sensitivity was strong, and the remaining other U.S. producer and two U.S. importers reported that

such price sensitivity was effectively nil.

Five responding firms asserted that if wooden bedroom furniture were to become too expensive,

consumers would simply postpone their purchase or purchase other consumer products.60 ***, a

nonpetitioning U.S. producer and one of the five responding firms, asserted that if wooden bedroom

furniture became more expensive the following would occur: (1) consumers would continue to use their

existing bedroom furniture, as such products can last up to 30 years,61 and (2) consumers would buy

instead other expensive products that seem to be better values, such as dining room furniture, sofas,

electronic equipment, entertainment centers, appliances, etc., and/or lower-value, ready-to-assemble

furniture (such as that found in IKEA stores or produced by Sauder Woodworking Company, a

nonpetitioning U.S. producer of wooden bedroom furniture).

Twenty-one U.S. producers and 25 U.S. importers of the domestic and imported Chinese wooden

bedroom furniture provided useable information in their questionnaire response regarding the extent to

which residential consumers view rental wooden bedroom furniture as a substitute for purchasing new

wooden bedroom furniture. Ten of the responding U.S. producers and 20 of the responding U.S.

importers reported that rental furniture acted as a substitute for purchases of new wooden bedroom

furniture.62 Four of these latter responding U.S. producers and six of the latter responding U.S. importers

reported that such substitution was minimal, whereas the remaining responding firms asserting

substitutability between rental and purchases of wooden bedroom furniture did not describe the strength

of this substitution.63 ***, a petitioning U.S. producer, commented that rental furniture acts as a substitute

for purchasing new wooden bedroom furniture when the consumer has poor credit or no credit and cannot

afford to purchase furniture. Also, people that are transient generally do not want to buy furniture that

they will have to move frequently; military personnel tend to fall into this category. According to ***,

since 2002, the furniture rental industry increased rentals due to the lack of available credit for the

average consumer during this period.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 64 Twelve of the 38 responding U.S. importers are retailers of wooden bedroom furniture.

 65 These products were simple, solid pine furniture that reportedly had become plain and unfashionable. Solid

wood sales reportedly were once a big share of the U.S. market for wooden bedroom furniture but declined rapidly

and was no longer in fashion.

 66 Sixteen of the 27 responding U.S. producers and seven of the 11 responding U.S. importers that reported

moderate to strong price sensitivity among the various wooden bedroom furniture products were petitioning U.S.

producers.

II-17

Substitution among the various types, styles, and designs of wooden bedroom furniture

Thirty U.S. producers and 38 U.S. importers of the domestic and Chinese wooden bedroom

furniture provided useable comments regarding substitution in demand among the various types, styles,

and designs of wooden bedroom furniture;64 all of the reported comments were directed to U.S. residential

consumer demand for wooden bedroom furniture. Fifteen of the responding U.S. producers and 12 of the

responding U.S. importers reported that substitution occurred among the various wooden bedroom

products. On the other hand, eight other U.S. producers and 11 other U.S. producers reported that such

substitution never or rarely occurs, while the remaining seven U.S. producers and 15 U.S. importers

reported that consumer tastes determine what is substitutable or not and it is not possible for the

responding firms to specify which products are or are not substitutes. ***, a nonpetitioning U.S.

producer, reported that substitution did not occur among the various types, styles, and designs of wooden

bedroom furniture. According to ***, furniture is a fashion and style business, it is not a commodity

product. *** also noted that customers demand access to great designs and fashion-forward looks as well

as classical looks and everything in-between; they will not substitute a style they want for a style they do

not want. As an example, this domestic producer reported that three years ago about *** percent of its

products were produced in a style (Early American) that was declining.65 *** found that to survive it had

to produce different styles of wooden bedroom furniture with different materials at different price points. 

This domestic producer asserted that providing what the customers want and delivering it when they want

it is what drives success in the U.S. wooden bedroom furniture industry, not producing the same style

over and over with only minor changes, or hoping the customers will substitute for another furniture piece

that is less desirable to them. 

 Twenty-three of the 27 U.S. producers and 11 of the 30 U.S. importers of the domestic and

imported Chinese wooden bedroom furniture that commented on the price sensitivity of substitution

among the various types, styles, and designs of wooden bedroom furniture reported moderate to strong

price substitution.66 On the other hand, the remaining four responding U.S. producers and 19 responding

U.S. importers reported that such price sensitivity was weak to nonexistent.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 67 Advertising affects directly the perception of consumers about a particular brand-name, product, design, or

style of wooden bedroom furniture.

 68 Dr. John Reilly, economic consultant for the respondents, asserted that a price elasticity of substitution between

the domestic and imported Chinese wooden bedroom furniture likely ranges from 3 to 6, whereas the elasticity of

substitution between the imported Chinese products and those imported from nonsubject countries is likely 10 or

higher. According to Dr. Reilly, U.S. producers cannot produce the Chinese wooden bedroom furniture comprised of

extensively hand-worked products at U.S. price points targeted by the importers, whereas many nonsubject foreign

producers are able to do so. See postconference brief of the Furniture Retailers Group at exh. 16, p. 4.

 69 Nonprice factors referred to in the questionnaire request included quality, availability, transportation network,

product range, and technical support, but were not necessarily restricted to only these factors.

II-18

Substitutability Issues

The degree of substitution in demand between U.S.-produced and imported Chinese wooden

bedroom furniture depends upon such factors as relative prices, types of customers, conditions of sales,

and product differentiation. Product differentiation depends on factors such as the range of designs and

styles of products, quality, availability, reliability of supply, the market perception of these latter three

factors, and the extent of advertising.67 Customer preferences for particular products reportedly play a

significant role and are related to one or more of the aforementioned factors. Based on the reported

information in this investigation, there appears to be significant product differentiation limiting, at least

somewhat, the degree of substitution in demand between the U.S.-produced and imported Chinese

wooden bedroom furniture.68

Factors Affecting Sales and Purchases

U.S. producers and importers were requested in their questionnaires to report on the extent of 

interchangeability (products from different countries physically capable of being used in the same

applications) of U.S.-produced, imported Chinese, and third-country imported wooden bedroom furniture. 

They were also asked to report the extent of any differences other than price that would affect sales in the

U.S. market among U.S.-produced, imported Chinese, and third-country imported wooden bedroom

furniture.69 Responses of U.S. producers and importers regarding the degree of interchangeability between

domestic and imported wooden bedroom furniture are shown in table II-1, and their responses regarding

differences other than price affecting competition are shown in table II-2.

Table II-1

Wooden bedroom furniture: Perceived degree of interchangeability of wooden bedroom furniture produced in the

United States, imported from China, and imported from third countries

Country pair

Number of U.S. producers reporting1 Number of U.S. importers reporting2

AFSNOAFSNO

U.S. vs. China 29 6 2 2 -- 37 11 8 4 7

U.S. vs. third countries 22 6 4 1 3 30 12 7 3 7

China vs. third countries 19 7 3 2 4 33 12 4 3 6

1

 Third countries cited by U.S. producers in order of descending frequency are as follows: Indonesia (5), Brazil (4), Canada

(4), Malaysia (4), Mexico (4), Philippines (3), Vietnam (3), Taiwan (2), Thailand (2), Bolivia (1), Italy (1), and Slovenia (1). 2

 Third countries cited by U.S. importers in order of descending frequency are as follows: Indonesia (9), Malaysia (7), Brazil

(6), Thailand (6), Canada (5), Mexico (5), Vietnam (5), Taiwan (2), Philippines (2), India (1), and Italy (1).

Note: A = Always, F = Frequently, S = Sometimes, N = Never, O = No familiarity.

Source: Compiled from data submitted in response to Commission questionnaires.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 70 Seven other U.S. importers indicated that they had no familiarity with the domestic wooden bedroom furniture.

 71 The top third-country sources of wooden bedroom furniture cited by U.S. producers and importers reporting on

interchangeability included, in roughly descending order, Indonesia, Malaysia, Brazil, Canada, and Mexico.

 72 Of the 65 responding U.S. importers, 17 are retailers of wooden bedroom furniture.

II-19

Table II-2

Wooden bedroom furniture: Perceived importance of differences in factors other than price between wooden bedroom

furniture produced in the United States, imported from China, and imported from third countries and sold in the U.S.

market 

Country pair

Number of U.S. producers reporting1 Number of U.S. importers reporting2

AFSNOAFSNO

U.S. vs. China 9 2 13 16 -- 21 12 13 12 5

U.S. vs. third countries 6 3 13 11 3 20 9 15 6 7

China vs. third countries 3 1 12 11 5 17 9 16 8 4

1

 Third countries cited by U.S. producers in order of descending frequency are as follows: Indonesia (5), Malaysia (4),

Philippines (4), Canada (3), Taiwan (3), Vietnam (3), Brazil (2), Italy (2), Mexico (2), Thailand (2), Bolivia (1), India (1), and

Slovenia (1). 2

 Third countries cited by U.S. importers in order of descending frequency are as follows: Indonesia (10), Malaysia (10),

Vietnam (8), Brazil (5), Thailand (5), Mexico (4), Canada (3), Philippines (2), Taiwan (2), India (1), and Italy (1).

Note: A=Always, F = Frequently, S = Sometimes, N = Never, O = No familiarity.

Source: Compiled from data submitted in response to Commission questionnaires.

On the question regarding the degree of interchangeability, a total of 39 U.S. producers and 68

U.S. importers responded, but not necessarily for every country-pair. Twenty-nine U.S. producers and 37

U.S. importers asserted that the U.S.-produced and imported Chinese wooden bedroom furniture were

always interchangeable, eight U.S. producers and 12 U.S. importers asserted that the domestic and

imported Chinese furniture were frequently or sometimes interchangeable, and two U.S. producers and

four U.S. importers asserted that the domestic and imported Chinese furniture were never interchangeable

(table II-1).70 Although the number of firms comparing interchangeability of the domestic/imported

Chinese wooden bedroom furniture with third-country import sources of wooden bedroom furniture was

somewhat different from the number of firms comparing interchangeability between the domestic and

imported Chinese furniture, the responses were similar to those comparing the domestic and imported

Chinese furniture, generally finding that most sources of wooden bedroom furniture were always or

frequently interchangeable in the U.S. market.71 Given the broad concept of interchangeability, these

findings are not surprising despite likely differences in product features among domestic and imported

wooden bedroom furniture; such findings likely also apply to interchangeability of wooden bedroom

furniture with bedroom furniture constructed of other materials, and even with other furniture such as

sleep sofas.

On the question regarding differences in factors other than price affecting competition, a total of

41 U.S. producers and 65 U.S. importers responded,72 but not necessarily for every country-pair. Only

nine U.S. producers but 21 U.S. importers asserted that nonprice-factor differences between the domestic

and imported Chinese wooden bedroom furniture were always significant in sales of the domestic

furniture vis-a-vis that from China. Another two U.S. producers and 12 importers asserted that nonprice

differences between the domestic and imported Chinese wooden bedroom furniture were frequently

significant in sales of the domestic furniture vis-a-vis that from China, while an additional 29 U.S.

producers and 25 importers asserted that nonprice differences were sometimes or never a factor (table II-
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 73 Five other U.S. importers indicated that they had no familiarity with the domestic wooden bedroom furniture.

 74 The top third-country sources of wooden bedroom furniture cited by U.S. producers and importers commenting

on the significance of nonprice factors included, in roughly descending order, Indonesia, Malaysia, Vietnam, Brazil,

Thailand, and the Philippines.

 75 U.S. producers and importers were also requested in their questionnaire responses to provide any comments

where nonprice factors were always or frequently significant in competition between the domestic and imported

Chinese or third-country imported wooden bedroom furniture. A total of 11 U.S. producer questionnaire comments

and 33 U.S. importer questionnaire comments were received, although some comments were reported by firms

responding that nonprice factors were sometimes or never significant. Of the 33 U.S. importers providing

comments, 13 are retailers of wooden bedroom furniture. Of the 11 U.S. producers providing comments, three were

petitioners; petitioners’ comments typically asserted that competition between the domestic and imported Chinese

wooden bedroom furniture was driven only by price, not nonprice factors. Seven other (nonpetitioning) U.S.

producers asserted that quality and delivery were advantages for domestic wooden bedroom furniture vis-a-vis the

imported Chinese products. One of these latter U.S. producers, ***, noted that the quality of the Chinese products

has gotten better. Another of these U.S. producers, ***, reported that transportation costs are a huge nonprice factor

and noted that the firm can ship a truckload of wooden bedroom furniture from its plant in ***, to Los Angeles, CA,

for $***, but a container of furniture from China to Los Angeles, CA, costs $*** to ship. 

 76 *** sells its imported Chinese wooden bedroom furniture to U.S. retailers.

II-20

2).73 Although the number of firms responding was somewhat different in asserting differences in factors

other than price in sales of the domestic/imported Chinese wooden bedroom furniture versus thirdcountry import sources of wooden bedroom furniture, a majority of U.S. importers reported similarly that

nonprice factors were always or frequently significant in the sales of the domestic/imported Chinese

wooden bedroom furniture vis-a-vis that imported from third countries, while domestic producers,

particularly petitioners, generally reported that such factors were only sometimes or never significant.74

Many more U.S. importers than U.S. producers reported that nonprice factors always or frequently

affected sales and competition among the different country sources of wooden bedroom furniture in the

U.S. market, including competition between the domestic and imported Chinese furniture. Additional

comments reported by some of those U.S. producers and importers citing significant nonprice factors are

shown below to highlight the nature and variety of nonprice factors associated with wooden bedroom

furniture.75

***, an importer of the Chinese wooden bedroom furniture located in ***,76 asserted that

nonprice factors were frequently significant between wooden bedroom furniture produced in the United

States versus that imported from China and third-countries, the latter including Indonesia, Malaysia, the

Philippines, and Vietnam. *** identified the following as significant nonprice factors: (1) quality of

hand-carved pieces, (2) drawer construction, and (3) finish quality and smoothness. The firm noted that

the underlying factor is always the same–a consumer wants to buy a particular design or style, then the

above factors, including price, come into play only after the consumer has decided on what design or style

to buy. According to ***, hand carvings and specialized finishes from China, Indonesia, Malaysia, the

Philippines, and Vietnam, when compared to the United States, can frequently be a significant difference

because most U.S. furniture producers do not have the capacity (or desire) to produce these types of

finishes, in many cases, because of the labor needed. 

***, a U.S. furniture retailer that imported the Chinese wooden bedroom furniture and is located

in ***, asserted that nonprice factors were always significant between wooden bedroom furniture

produced in the United States versus that imported from China and third countries. *** has purchased

both domestic and foreign wooden bedroom furniture for sale in its retail stores. *** identified two

significant nonprice factors that influence the firm’s sourcing decisions for furniture, including wooden
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

II-21

bedroom furniture–(1) workmanship and (2) cooperative development of designs and brands. One of the

most important nonprice factors that influences *** sourcing decisions is a furniture manufacturer’s

ability and willingness to cooperate with the retailer to develop and build exclusive brand names and

designs. According to ***, for many years, the domestic producers refused to build exclusive brands and

designs of wooden bedroom furniture for *** or other retailers. Instead, the domestic producers insisted

that any brand or design of wooden bedroom furniture they made would be available to all of their retailer

customers. As a result, *** efforts to create its brand and differentiate itself had been frustrated by the

domestic furniture producers. This retailer asserted that, when the domestic producers dominated the

supply side, retail competition was primarily based on price.

Several years ago, *** began to work with furniture producers in China, other countries in the Far

East, and *** to meet its needs. *** asserted that these overseas furniture producers were much more

willing to help build the *** furniture brands and styles. As a result, the firm has been able to compete

with other retailers on a basis other than price and has reduced price-based competition at the retail level. 

According to ***, even recently the domestic furniture producers refused to work with the retailer to

produce unique designs and brands of furniture. As a result, *** is reluctant to rely on the domestic

producers. *** asserted that the approach of domestic furniture producers, which reportedly favors

department stores over specialty furniture retailers, ultimately has increased their dependence on those

sales to the detriment of the specialty furniture retailers.

 Another nonprice factor that influences *** sourcing decisions is workmanship in the

construction of furniture, including wooden bedroom furniture. *** took into account the skilled

workforce in China in deciding to source their furniture from this country. According to ***, China has

developed over the years the ability to construct furniture that is heavily carved. This product feature

reportedly is significant in the selection of products by consumers and is significant in differentiating

styles and brands sold by specialty furniture retailers. *** asserted that domestic furniture producers

abandoned many years ago the market for heavily carved furniture styles. As a result, *** and others

were forced either to abandon U.S. consumer demand for these products or seek to meet that demand. 

Currently, *** is unaware of any domestic producers from whom to source these products, which are

extremely important to this retailer.

***, a furniture retailer that imported the Chinese wooden bedroom furniture and is located in

***, asserted that style and design of furniture, no matter where it is made, is the retail consumers’

number-one priority, and quality is their next key requirement. *** reported that it found the quality of

furniture produced in many factories in China to be excellent. *** has statistically tracked quality of

furniture and has found the Chinese furniture producers to exceed their expectations and the quality

performance of many U.S. furniture producers.

*** including furniture and an importer of the Chinese wooden bedroom furniture and

headquartered in ***, asserted that nonprice factors were always significant between wooden bedroom

furniture produced in the United States versus that imported from China and third-countries, the latter

including Brazil and Thailand. *** commented on five nonprice factors that it asserted led the firm to

switch from domestic to imported Chinese wooden bedroom furniture–(1) design quality, (2) quality

control, (3) packaging specifications, (4) technical support, and (5) quality production capacity. With

respect to design quality, *** asserted that U.S. producers of wooden bedroom furniture market furniture

items essentially that they sell to all their customers, including furniture retailers. When *** purchased

these furniture items from U.S. producers, it was unable to differentiate its products, for purposes of

marketing to *** customers, from the furniture of any other U.S. retailer. As a result of using only

“market items” sold by U.S. furniture producers, U.S. consumers were offered a limited variety of

furniture products. According to ***, when it approached its U.S. furniture suppliers with the idea of
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 77 *** asserted that when it purchased furniture from U.S. producers during ***, its losses increased from $*** to

a high of $***. Since sourcing its furniture overseas, the ***. See questionnaire response of ***.

 78 *** sells its imported Chinese wooden bedroom furniture to U.S. retailers.

 79 *** sells its imported Chinese wooden bedroom furniture to U.S. retailers.

II-22

creating *** private brand furniture, unique by its design and quality, U.S. furniture producers were

unable or unwilling to meet *** design, quality, and packaging specifications. But by working with

Chinese, Brazilian, and Thai producers of wooden bedroom furniture, *** was able to design products

that are unique to ***. As a result, *** has been able to offer its customers a wider variety of furniture. 

In addition, *** benefits because it is able to compete with other U.S. retailers on the basis of quality,

uniqueness, and price of its product and not only on the price of identical products. *** noted the

following design specifications that it has been able to initiate through its foreign suppliers: ***.

***. ***.77 ***.

With respect to packaging specifications, *** explained that it has written specifications for

furniture packaging to ensure protection and minimize quality defects due to in-transit damages. 

According to ***, its supplying U.S. producers were unable or unwilling to meet *** packaging

standards, which resulted in substantially higher costs to ***.

*** also asserted that its foreign producers of wooden bedroom furniture offer far superior

technical support (specialty finishes, etc.) than that offered by the U.S. furniture producers, and that U.S.

furniture manufacturing does not have enough quality production capacity to meet the demands of the

U.S. market.

*** that imports the Chinese wooden bedroom furniture and is headquartered in ***, asserted that

all of its wooden bedroom furniture is purchased from producers in China. *** asserted that nonprice

factors were frequently significant between wooden bedroom furniture produced in the United States

versus that imported from China. This retailer asserted that, although price and value are significant

factors in its sales, styling, construction, and availability are also major factors.

***, an importer of the Chinese wooden bedroom furniture located in ***,78 asserted that

nonprice factors are always significant between wooden bedroom furniture produced in the United States

versus that imported from China and from Taiwan. *** stated that, although price might contribute 50

percent of the factors considered by consumers when they decide to purchase wooden bedroom furniture,

the other factors of quality, availability, transportation, product range, and technical support are equally

important.

***, an importer of the Chinese wooden bedroom furniture located in ***,79 asserted that

nonprice factors are frequently significant between wooden bedroom furniture produced in the United

States versus that imported from China and third countries. *** commented that the quality of goods,

availability of product, and technical support are frequently factors used to decide what products the

consumer will ultimately purchase.

*** reported that nonprice factors are always significant between wooden bedroom furniture

produced in the United States versus that imported from China and third-countries, the latter including

Indonesia, Malaysia, and Vietnam. Such nonprice factors reportedly include quality, availability, style,

intricacy of carvings, and sophistication of wood finishes. ***, which purchases domestic and foreign
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 80 *** also asserted that it is not possible for a factory in the United States to make a wooden bedroom furniture

suite with similar extensive carvings and finishes at a price that would allow this retailer to sell the same furniture

suite in its stores at commercially viable price points.

II-23

produced wooden bedroom furniture for sale in its U.S. furniture retail stores, asserted that imported

wooden bedroom furniture from China, Indonesia, Malaysia, and Vietnam have significantly fewer

quality issues and defects than the furniture produced in the United States. In addition, foreign producers

reportedly are more willing than U.S. producers to work with this retailer to reduce defect rates in their

products. As an example, *** noted that in ***. ***. In addition, *** asserted that the style and

sophistication of the wood carvings and finishes are much more extensive with the imported Chinese

wooden bedroom furniture compared to that produced in the United States.80

*** asserted that nonprice factors are always significant between wooden bedroom furniture

produced in the United States versus that imported from China and third-countries, the latter including

Colombia, Mexico, the Philippines, South Africa, and Taiwan. *** asserted that factors such as quality,

availability, transportation network, product range, and technical support differentiate producers and

make products more attractive to the retailer.

***, a U.S. furniture retailer and importer of Chinese wooden bedroom furniture headquartered in

***, reported that nonprice factors are always significant between wooden bedroom furniture produced in

the United States versus that imported from China and third countries, the latter including Malaysia,

Thailand, and Vietnam. Such nonprice factors reportedly include product design, affordability, quality,

availability, and transportation costs. According to ***, producers of wooden bedroom furniture in

China, Malaysia, Thailand, and Vietnam can always supply a much more varied design than domestic

furniture producers. This reportedly is true especially in traditional, contemporary, and West Indies style

categories. These foreign producers have superior hand carvings, veneer work, hand painting, and the

local availability of metal, stone, and wicker. This gives flexibility to develop a complete range of styles

and looks for any segment of the U.S. market. Such flexibility reportedly does not exist domestically. 

*** commented that furniture producers in China, Thailand, and Vietnam offer superior quality and

enhanced construction features, such as–(1) screwed-in plywood backs instead of being stapled on

masonite, and (2) dovetailed wood drawer construction instead of paper coated fiberboard that cannot be

repaired. In addition, furniture producers in these countries reportedly offer superior detail work, such

as–(1) much more intricate veneer work than can be had in domestic plants, and (2) much better handcarved applications on bed posts, paneled mirrors, dressers, and chest fronts/tops. Domestic furniture

producers reportedly can only duplicate this if they themselves import these parts from East Asia and they

usually do. *** also commented that China, Malaysia, Thailand, and Vietnam all can supply the

necessary quantity of product to meet the needs of the U.S. market. This is especially true at the betterto-best end of the product line of wooden bedroom furniture. In this area, domestic furniture producers

reportedly are importing many parts from East Asia but do a poor job of flowing them, which causes

continual delays and missed shipping dates. If *** were to rely solely on domestic furniture producers, it

reportedly would greatly reduce the retailer’s wooden bedroom volume.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 81 *** sells its imported Chinese wooden bedroom furniture to U.S. retailers.

 82 *** sells its imported Chinese wooden bedroom furniture to U.S. retailers.

II-24

***, an importer of the Chinese wooden bedroom furniture located in ***,81 asserted that

nonprice factors are sometimes significant between wooden bedroom furniture produced in the United

States versus that imported from China. *** commented that Chinese furniture producers offer quality

wooden bedroom furniture comparable to or better than that from U.S. producers at the same price. ***

noted that availability and transportation costs used to favor domestic producers, because of the distance

from China, but this has improved in the last two years as many retailers are taking direct shipments from

China and avoiding purchases from U.S. warehouses. Chinese furniture producers reportedly generally

offer a wider product range of wooden bedroom furniture than U.S. furniture producers.

***, a furniture retailer that imports Chinese wooden bedroom furniture and is located in ***,

asserted that nonprice factors are always significant between the domestic and imported Chinese wooden

bedroom furniture. *** reported that it sells ready-to-assemble wooden bedroom furniture in its U.S.

retail stores that is not available from domestic production at the same level of design, quality, price, and

technical support. Virtually all of *** wooden bedroom furniture is of proprietary design and exclusive

to ***. *** asserted that U.S. furniture producers will not or cannot produce this product at competitive

prices or competitive quality.

***, an importer of the Chinese wooden bedroom furniture located in ***,82 asserted that

nonprice factors are always significant between wooden bedroom furniture produced in the United States

versus that imported from China and from third countries. According to ***, Chinese furniture producers

are light years ahead of any other import source country in terms of flexibility, capability, and most

importantly how the commonly U.S.-supplied materials are used to produce wooden bedroom furniture;

this reportedly even includes most U.S. furniture producers, except where they import to enhance their

bottom line and source offshore parts or whole collections that they cannot or do not want to produce.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 1 The Commission received questionnaire responses from 12 additional firms; however, these firms provided only

limited or non-usable data and their responses are not included in the U.S. producers’ trade and financial data. These

firms are: ***.

 2

 Coverage was calculated using the Commission’s total shipment value of $2.077 billion (see table III-3) and the

petitioners’ estimate of $2.5 billion. See petition, exh. 4. The petition estimated the total value of U.S. producers’

domestically produced U.S. shipments to be $*** in 2002. However, this figure is marked as confidential because

of the source of the data. Counsel to petitioners indicated that the figure of $2.5 billion can be used publicly and

noted that ***. Staff conversation with Joe Dorn, counsel to petitioners, December 22, 2003.

 3

 The Commission sent producers’ questionnaires to all U.S. producers identified in the petition. See petition at

exh. 1 and 2. 

 4

 Thirty out of 40 responding U.S. producers support the petition, six firms oppose the petition, and four firms

take no position with respect to the petition. The respondents state that ***. See foreign producer/importer

respondents’ postconference brief at 1 fn. 1; however, this firm did not provide a questionnaire response to the

Commission.

 5

 The value of U.S. shipments are presented in the table to represent the relative size of U.S. producers rather than

production because many firms had difficulty calculating production quantities on either a pieces or pounds basis.

 6

 Twenty of 40 responding producers imported the subject merchandise from China in January 2000-June 2003. 

See section entitled U.S. Producers’ Imports in Part IV of this report for additional information on U.S. producers’

imports.

 7

 Production data are not used in the comparisons because several firms could not provide such data; however, all

firms provided the value of U.S. shipments. U.S. producers’ exports were relatively minimal and their inventories

were relatively stable.

III-1

PART III: U.S. PRODUCERS’ PRODUCTION,

SHIPMENTS, AND EMPLOYMENT

Information on capacity, production, shipments, inventories, and employment is presented in this

section of the report and is based on the questionnaire responses of 40 U.S. producers of wooden bedroom

furniture1

 representing approximately 83 percent of the value of U.S. shipments of domestically produced

wooden bedroom furniture in 2002.2

 A summary of U.S. producer data is presented in appendix C.

U.S. PRODUCERS

Table III-1 presents a list of U.S. producers responding to the Commission’s questionnaires,3

 the

locations of corporate headquarters, the positions taken with respect to the petition,4

 the values and shares

of U.S. shipments by firm in 2002,5

 and whether the firms directly imported the subject merchandise from

China during January 2000-June 2003.6

Petitioning producers accounted for *** percent of U.S. shipments (based on value) in 2002, and 

all firms supporting the petition accounted for *** percent of U.S. shipments. Firms opposing the petition

accounted for *** percent of U.S. shipments in 2002 while firms taking no position with respect to the

petition accounted for *** percent of U.S. shipments in 2002.7
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

III-2

Table III-1

Wooden bedroom furniture: U.S. producers, locations of corporate headquarters, positions taken with respect to the petition, shares of reported

domestically produced U.S. shipments in 2002, and whether firms directly imported the subject merchandise from China in January 2000-June 20031

Firms Location

Position taken with respect to the petition Domestically

produced U.S.

shipments in 2002

Firm

imported

from China

Support Oppose 

Takes no

position

Public

Yes No Value Share Yes No

$1,000 Percent

American Drew2 NC Petitioner U *** *** *** ***

American of Martinsville2 VA Petitioner U *** *** *** ***

Ashley Furniture WI U U *** *** *** ***

Bassett Furniture VA Petitioner U *** *** *** ***

Carolina Furniture Works SC Petitioner U *** *** *** ***

Century Furniture3 NC Petitioner U *** *** *** ***

Crawford Manufacturing4 NY Petitioner U *** *** *** ***

Crescent Manufacturing TN Petitioner U *** *** *** ***

Ethan Allen5 CT *** *** *** U *** *** *** ***

Furniture Brands International MO U U *** *** *** ***

Harden Manufacturing AL *** *** *** U *** *** *** ***

Harden Furniture NY Petitioner U *** *** *** ***

Hart Furniture TN Petitioner U *** *** *** ***

Higdon Furniture4 FL Petitioner U *** *** *** ***

Hooker Furniture VA Petitioner U *** *** *** ***

Johnston-Tombigbee Furniture MO Petitioner U *** *** *** ***

Kincaid Furniture2 NC Petitioner U *** *** *** ***

L. & J.G. Stickley NY Petitioner U *** *** *** ***

Lea Industries2 NC Petitioner U *** *** *** ***

Michels & Company CA Petitioner U *** *** *** ***

MJ Wood Products VT Petitioner U *** *** *** ***

Mobel IN Petitioner U *** *** *** ***

Modern Furniture WA U U *** *** *** ***

Moosehead Manufacturing ME Petitioner U *** *** *** ***

Oakwood Interiors CA U U *** *** *** ***

Pennsylvania House2 NC Petitioner U *** *** *** ***

Progressive Furniture6 OH *** *** *** U *** *** *** ***

Sandberg Furniture CA Petitioner U *** *** *** ***

Sauder Woodworking OH *** *** *** U *** *** *** ***

Standard Furniture Manufacturing AL U U *** *** *** ***

Stanley Furniture VA Petitioner U *** *** *** ***

T. Copeland & Sons VT Petitioner U *** *** *** ***

Thornwood Furniture AZ *** *** *** U *** *** *** ***

Trendwood AZ *** *** *** U *** *** *** ***

Vaughan Furniture VA Petitioner U *** *** *** ***

Vaughan-Bassett Furniture VA Petitioner U *** *** *** ***

Vermont Tubbs VT Petitioner U *** *** *** ***

Webb Furniture7 VA Petitioner U *** *** *** ***

Whittier Wood Products OR *** *** *** U *** *** *** ***

Woodstuff Manufacturing8 AZ *** *** *** U *** *** *** ***

 Total (40) *** *** *** 32 8 2,077,198 100.0 20 20

1

 The following 12 firms provided only limited or non-usable data and their responses are not included in the U.S. producers’ trade and financial data: ***. 2

 Firm is a wholly owned subsidiary of La-Z-Boy Inc., Monroe, MI.

3

 Firm is a wholly owned subsidiary of CV Industries, Hickory, NC.

4

 Firm provided very limited trade data and no usable financial data.

5

 Firm is a wholly owned subsidiary of Ethan Allen Interiors, Inc., Danbury, CT. ***. 6

 Firm is a wholly owned subsidiary of Sauder Woodworking Company, Archbold, OH.

7

 Firm is a 50/50 joint venture owned by Vaughan Furniture and Vaughan-Bassett Furniture, Galax, VA.

8

 Firm does business as Samuel Lawrence and is owned ***.

Source: Compiled from data submitted in response to Commission questionnaires.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

III-3

U.S. CAPACITY, PRODUCTION, AND CAPACITY UTILIZATION

U.S. producers’ capacity, production, and capacity utilization data are presented in table III-2. 

The Commission’s producers’ questionnaire requested that firms provide production and capacity data for

pieces and pounds; however, many firms could not provide quantity data.

Table III-2

Wooden bedroom furniture: U.S. producers’ capacity, production, and capacity utilization, 2000-02,

January-June 2002, and January-June 2003

Item

Calendar year January-June

2000 2001 2002 2002 2003

Capacity (quantity)

Pieces1 14,815,964 14,547,521 14,258,472 7,396,217 6,889,240

Pounds2 1,127,940,453 1,078,107,043 1,052,169,714 546,090,766 501,887,617

Production (quantity)

Pieces3 13,720,679 12,375,325 12,307,669 6,606,824 6,066,888

Pounds4 1,041,830,912 911,726,458 931,385,336 491,953,073 461,516,183

Capacity utilization (percent)

Pieces 82.7 75.8 75.4 79.1 75.4

Pounds 78.9 71.0 72.0 74.4 72.4

1

 Four producers, ***, did not provide capacity data for pieces. 2

 *** did not provide capacity data for pounds.

3

 Five producers, ***, did not provide production data for pieces. 4

 Eight producers, ***, did not provide production data for pounds.

Source: Compiled from data submitted in response to Commission questionnaires. 

Four producers, ***, did not provide capacity data for pieces. ***. Five producers, ***, did not

provide production data for pieces. Eight producers, ***, did not provide production data for pounds.

Many U.S. producers that provided usable data indicated that they had difficulty in determining

capacity because of the nature of the production process, which includes three distinct production

processes (sawing, assembling, and finishing), each of which has its own capacities and constraints. In

many instances, firms providing capacity data based their responses on “best estimates.” With respect to

production, many producers indicated that they had difficulty providing precise production data because

their firm’s data reporting systems do not collect the data as requested.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 8 Shares based on value are not presented because many responding firms did not supply value data for shipments

by market segment.

III-4

U.S. PRODUCERS’ SHIPMENTS

Data on U.S. producers’ shipments, by types, are presented in table III-3. Approximately 69

percent of U.S. producers’ commercial shipments (based on pieces) were to furniture retailers, 3 percent

to furniture distributors, 3 percent to hospitality firms, 24 percent to furniture rental firms, and 1 percent

to other firms.8

 Based on pounds, approximately 83 percent of U.S. producers’ commercial shipments

(based on pounds) were to furniture retailers, 3 percent to furniture distributors, 5 percent to hospitality

firms, 7 percent to furniture rental firms, and 2 percent to other firms.

Table III-3

Wooden bedroom furniture: U.S. producers’ shipments, by types, 2000-02, January-June 2002, and

January-June 20031

Item

Calendar year January-June

2000 2001 2002 2002 2003

Value ($1,000)

Commercial shipments 2,493,363 2,220,212 2,069,250 1,116,107 953,538

Internal consumption *** *** *** *** ***

Transfers to related firms *** *** *** *** ***

U.S. shipments 2,500,097 2,223,842 2,077,198 1,119,686 958,913

Export shipments 40,896 33,649 33,163 16,290 14,626

Total shipments2 2,540,993 2,257,491 2,110,361 1,135,976 973,539

Share of total shipments (percent)

Commercial shipments 98.1 98.3 98.1 98.3 97.9

Internal consumption *** *** *** *** ***

Transfers to related firms *** *** *** *** ***

U.S. shipments 98.4 98.5 98.4 98.6 98.5

Export shipments 1.6 1.5 1.6 1.4 1.5

Total shipments2 100.0 100.0 100.0 100.0 100.0

1

 The Commission’s producers’ questionnaire requested that firms provide data for pieces and pounds; however, many firms

could not provide data for either pieces or pounds, and some firms could not provide any quantity data. Therefore, quantity data

and unit values are not presented. Parties generally agree that value data are the most probative. 2

 The value for total shipments differs slightly from the value of net sales presented in the financial section of this report

because some firms reported their financials on a fiscal-year rather than calendar-year basis.

Source: Compiled from data submitted in response to Commission questionnaires. 
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 9 See section entitled U.S. Producers’ Imports presented in Part IV of this report.

III-5

U.S. PRODUCERS’ PURCHASES

Information on U.S. producers’ purchases are presented in table III-4. Four U.S. producers, ***,

purchased subject merchandise from China during January 2000-June 2003. Table III-5 presents

information on the ratio of U.S. producers’ purchases of the subject imports to the value of their U.S.

shipments.

Table III-4

Wooden bedroom furniture: U.S. producers’ purchases, by sources, 2000-02, January-June 2002, and

January-June 2003

*******

Table III-5

Wooden bedroom furniture: U.S. producers’ purchases of subject imports, U.S. shipments, and ratio of

purchases of subject imports to U.S. shipments, 2000-02, January-June 2002, and January-June 2003

*******

Twenty U.S. producers also directly imported subject merchandise from China during January

2000-June 2003.9

 However, ***. ***. 
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 10 Four firms, ***, did not provide inventory data for pieces, while seven firms, ***, did not provide inventory 

data for pounds.

III-6

U.S. PRODUCERS’ INVENTORIES

Data on U.S. producers’ inventories of domestically produced wooden bedroom furniture are 

presented in table III-6. As with other quantity data presented in the report, several firms did not report

inventory data for pieces or pounds.10

Table III-6

Wooden bedroom furniture: U.S. producers’ end-of-period inventories, 2000-02, January-June 2002, and

January-June 20031

Item

Calendar year January-June

2000 2001 2002 2002 2003

Inventories (quantity)

Pieces1 1,783,934 1,606,587 1,657,847 1,697,310 1,736,813

Pounds2 149,696,421 131,682,754 140,230,975 141,677,615 145,553,431

Ratio of inventories to production (percent)

Pieces 13.0 13.0 13.5 12.8 14.3

Pounds 14.4 14.4 15.1 14.4 15.8

Ratio of inventories to U.S. shipments (percent)

Pieces 13.3 13.0 13.7 13.1 14.7

Pounds 14.9 14.4 15.5 14.8 16.3

Ratio of inventories to total shipments (percent)

Pieces 13.1 12.8 13.5 12.9 14.5

Pounds 14.6 14.2 15.2 14.6 16.0

1

 Four firms, ***, did not provide inventory data for pieces. 2

 Seven firms, ***, did not provide inventory data for pounds.

Note–Ratios are calculated using data from firms that provided both numerator and denominator information. Partial-year ratios

are calculated using annualized production and shipment data.

Source: Compiled from data submitted in response to Commission questionnaires. 
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 11 See petitioners’ postconference brief at exh. B.

 12 Trade Act of 1974, as amended (19 U.S.C. § 2272(a)).

 13 See petitioners’ postconference brief at exh. 1 and attachment A. The petitioners note that not all of the TAA

applications specify China as the source of import competition, and that not all of the closed plants produced wooden

bedroom furniture.

 14 See question II-5 of the Commission’s U.S. producers’ questionnaire.

 15 Firms responding “Yes” are: ***. 

III-7

U.S. EMPLOYMENT, WAGES, AND PRODUCTIVITY

U.S. producers’ employment data are presented in table III-7. The petitioners identified 45 plant

closings at 28 firms since January 2000, resulting in the layoffs of 11,967 workers.11

Table III-7

Wooden bedroom furniture: Average number of production and related workers, hours worked, wages

paid to such employees, hourly wages, productivity, and unit labor costs, 2000-02, January-June 2002,

and January-June 2003

Item

Calendar year January-June

2000 2001 2002 2002 2003

Production and related workers (number) 38,687 34,859 31,990 33,069 29,555

Hours worked (1,000) 67,425 57,970 55,311 30,728 26,860

Wages paid ($1,000) 856,562 766,185 736,570 424,011 368,489

Hourly wages $11.19 $11.67 $12.08 $12.29 $12.40

Productivity1 (pieces per 1,000 hours) 203 214 223 215 227

Productivity1 (pounds per 1,000 hours) 16,555 16,924 18,093 17,265 18,653

Unit labor costs2 (per piece) $55.09 $54.67 $54.25 $57.12 $54.69

Unit labor costs2 (per pound) $0.69 $0.71 $0.68 $0.73 $0.68

1 Productivity is calculated using data of only those firms providing both numerator and denominator information. 2

 Unit labor costs are calculated using data of only those firms providing both numerator and denominator information.

Source: Compiled from data submitted in response to Commission questionnaires. 

The petitioners also indicated that the U.S. Department of Labor (Labor) has certified 7,210

furniture workers at approximately 48 plants for trade adjustment assistance (TAA)12 from January 2000

to June 2003.13 U.S. producers were asked if their firms or workers had applied for TAA certification

directly related to imports of bedroom furniture from China.14 Twelve firms responded “Yes.”15
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 16 See question II-4 of the Commission’s U.S. producers’ questionnaire.

III-8

U.S. producers were asked whether unions represent workers at their U.S. production facilities.16

Thirty-two U.S. producers reported “No” and eight reported “Yes.” Table III-8 presents a list of U.S.

producers reporting union representation of their production and related workers.

Table III-8

Wooden bedroom furniture: U.S. producers reporting union representation of their production and related

workers

*******
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 1 See petition at exh. 7. Customs identifies over 1,100 individual firms as importers of record of the subject

merchandise from China during January 2002-June 2003.

 2

 Eleven additional firms responded that they imported the subject merchandise; however, their questionnaire

responses were either incomplete or did not contain usable data. Thirty firms responded that they did not import the

subject merchandise from China. 

 3

 U.S. imports from China of responding U.S. importers were $311.4 million in 2000 (72.0 percent coverage

compared with official import statistics), $469.9 million in 2001 (83.1 percent coverage), $925.6 million in 2002

(96.6 percent coverage), and $549.2 million in January-June 2003 (87.9 percent coverage).

 4

 Based on Customs data.

 5

 Official import statistics presented for wooden bedroom furniture are comprised of two HTS statistical reporting

numbers: 9403.50.9040 (wooden beds of a kind used in the bedroom) and 9403.50.9080 (wooden furniture of a kind

used in the bedroom not elsewhere classified). The scope includes two additional HTS statistical reporting numbers

under which the subject merchandise may enter the United States: 9403.90.7000 (furniture parts of wood) and

7009.92.5000 (glass mirrors, framed over 929 cm2

 in reflecting area); however, these HTS reporting numbers are

residual or “basket” categories that also contain nonsubject imports. The petitioners did not include the latter two

HTS statistical reporting numbers in their analysis of subject imports in the petition. To the extent that subject

imports enter under the latter HTS statistical reporting numbers, import data may be slightly understated.

 6

 Official import statistics count each piece of a wooden bed (e.g., headboard, footboard, sideboards) as separate

pieces. However, the Commission’s questionnaires defined a wooden bed as any combination of headboard,

footboard, or sideboards.

 7

 Data on U.S. importers’ inventories, which are based on Commission importers’ questionnaires, are based on

quantity rather than value.

IV-1

PART IV: U.S. IMPORTS, APPARENT

CONSUMPTION, AND MARKET SHARES

U.S. IMPORTERS

The Commission sent questionnaires to all 164 U.S. importers of wooden bedroom furniture

identified in the petition,1

 and received usable responses from 82 firms2 that are believed to account for

approximately 87.4 percent of U.S. imports from China (based on value) in January 2000-June 2003.3

The Commission received questionnaire responses from the top 10 importers from January 2002-June

2003.4

U.S. IMPORTS

Because of the relatively low import coverage of responding importers, data for imports of

wooden bedroom furniture that are presented throughout this report are based on official statistics of

Commerce, unless otherwise noted.5

 Table IV-1 and figure IV-1 present data on U.S. imports of wooden

bedroom furniture. 

Official import statistics provide quantity data for wooden beds6

 but not for other wooden

bedroom furniture. Therefore, official import data are presented in terms of value only.7
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

IV-2

Table IV-1

Wooden bedroom furniture: U.S. imports, by sources, 2000-02, January-June 2002, and January-June 20031

Source

Calendar year January-June

2000 2001 2002 2002 2003

Value ($1,000)

China2 432,675 565,551 957,948 404,700 624,601

Nonsubject:

Canada 415,278 414,059 401,392 206,415 200,729

Italy 189,582 185,056 198,556 91,429 90,189

Indonesia 130,582 130,165 151,394 67,795 72,406

Mexico 170,549 145,171 127,553 66,414 49,222

Brazil 43,038 73,216 98,903 44,612 48,479

Malaysia 50,136 44,897 67,979 27,831 50,301

Taiwan 57,749 65,855 64,394 32,097 21,062

Thailand 11,316 19,553 29,810 13,889 16,406

Denmark 20,164 23,258 26,376 11,616 12,098

All other 160,611 162,500 187,150 86,100 102,038

Subtotal, nonsubject 1,249,004 1,263,729 1,353,509 648,197 662,928

Total 1,681,679 1,829,281 2,311,456 1,052,897 1,287,529

Share of value (percent)

China 25.7 30.9 41.4 38.4 48.5

Nonsubject:

Canada 24.7 22.6 17.4 19.6 15.6

Italy 11.3 10.1 8.6 8.7 7.0

Indonesia 7.8 7.1 6.6 6.4 5.6

Mexico 10.1 7.9 5.5 6.3 3.8

Brazil 2.6 4.0 4.3 4.2 3.8

Malaysia 3.0 2.5 2.9 2.6 3.9

Taiwan 3.4 3.6 2.8 3.0 1.6

Thailand 0.7 1.1 1.3 1.3 1.3

Denmark 1.2 1.3 1.1 1.1 0.9

All other 9.6 8.9 8.1 8.2 7.9

Subtotal, nonsubject 74.3 69.1 58.6 61.6 51.5

Total 100.0 100.0 100.0 100.0 100.0

1

 Official import statistics presented for wooden bedroom furniture are comprised of two HTS statistical reporting numbers: 

9403.50.9040 (wooden beds of a kind used in the bedroom) and 9403.50.9080 (wooden furniture of a kind used in the bedroom

not elsewhere classified). The scope includes two additional HTS statistical reporting numbers under which the subject

merchandise may enter the United States: 9403.90.7000 (furniture parts of wood) and 7009.92.5000 (glass mirrors, framed over

929 cm2

 in reflecting area); however, these other HTS reporting numbers are residual or “basket” categories that also contain

nonsubject imports. To the extent that subject imports enter under the latter HTS statistical reporting numbers, import data may

be slightly understated. 2

 U.S. producers accounted for 29.4 percent of subject imports from China in 2000, 29.5 percent in 2001, 35.2 percent in

2002, 35.8 percent in January-June 2002, and 33.3 percent in January-June 2003.

Note.–Because of rounding, figures may not add to the totals shown.

Source: Compiled from official statistics of Commerce.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

IV-3

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

2000 2001 2002 January-June 2002 January-June 2003

Value ($1,000) 

China Nonsubject 

Figure IV-1

Wooden bedroom furniture: U.S. imports, by sources, 2000-02, January-June 2002, and January-June 2003

Source: Table IV-1.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 8 Information on U.S. producers’ purchases of imports (i.e., nondirect imports where U.S. producers are not the

importer of record) are presented in Part III of this report in the section entitled U.S. Producers’ Purchases.

 9

 Petitioning firms accounted for 14 of the 20 U.S. producers importing the subject merchandise.

 10 Petitioning firms accounted for 7.8 percent of U.S. imports of the subject merchandise in 2000, 5.6 percent in

2001, 6.9 percent in 2002, 7.8 percent in January-June 2002, and 8.1 percent in January-June 2003.

 11 Direct subject imports by petitioning firms as a share of their domestically produced U.S. shipments were 3.3 

percent in 2000, 4.2 percent in 2001, 8.3 percent in 2002, 7.7 percent in January-June 2002, and 15.8 percent in

January-June 2003.

IV-4

U.S. PRODUCERS’ IMPORTS

Table IV-2 presents U.S. producers’ direct imports of subject merchandise during January 2000-

June 2003.8

 Twenty U.S. producers reported directly importing wooden bedroom furniture from China.9 

U.S. producers’ imports from China accounted for 29.4 percent of U.S. imports of the subject

merchandise in 2000, 29.5 percent in 2001, 35.2 percent in 2002, 35.8 percent in January-June 2002, and

33.3 percent in January-June 2003.10

Figure IV-2 presents U.S. producers’ subject imports as a share of domestically produced U.S.

shipments. Direct subject imports by U.S. producers as a share of domestically produced U.S. shipments

increased throughout January 2000-June 2003, increasing from 6.0 percent in 2000 to 9.0 percent in 2001,

19.6 percent in 2002, 15.8 percent in January-June 2002, and 26.6 percent in January-June 2003.11

APPARENT U.S. CONSUMPTION AND U.S. MARKET SHARES

Table IV-3 and figure IV-3 present data on apparent U.S. consumption and market shares of

wooden bedroom furniture.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

IV-5

Table IV-2

Wooden bedroom furniture: U.S. producers’ direct imports of the subject merchandise from China, and U.S. producers’

shipments of domestically produced product, by firms, 2000-02, January-June 2002, and January-June 2003

Firm

Calendar year January-June

2000 2001 2002 2002 2003

Value of U.S. producers’ direct imports from China ($1,000)

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

Total (20) 127,361 166,588 337,041 145,048 207,868

Value of domestically produced U.S. shipments ($1,000)

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

Total 2,117,687 1,859,747 1,715,537 917,730 782,195

Table continued. See footnotes at end of table.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

IV-6

Table IV-2--Continued

Wooden bedroom furniture: U.S. producers’ direct imports of the subject merchandise from China, and U.S. producers’

shipments of domestically produced product, by firms, 2000-02, January-June 2002, and January-June 2003

Firm

Calendar year January-June

2000 2001 2002 2002 2003

Ratio of U.S. producers’ direct imports from China to total imports from China (percent)

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

Total (20) 29.4 29.5 35.2 35.8 33.3

Ratio of U.S. producers’ direct imports to domestically produced U.S. shipments

(percent)

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

Average 6.0 9.0 19.6 15.8 26.6

1

 ***.

2

 ***.

Source: Compiled from data submitted in response to Commission questionnaires.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

IV-7

26.6%

15.8%

6.0%

9.0%

19.6%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

2000 2001 2002 January-June 2002 January-June 2003

Ratio (percent) 

Figure IV-2

Wooden bedroom furniture: U.S. producers’ subject imports as a share of domestically produced

U.S. shipments, 2000-02, January-June 2002, and January-June 2003

Source: Table IV-2.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

IV-8

Table IV-3

Wooden bedroom furniture: U.S. shipments of domestic product, U.S. imports, by sources, apparent U.S. consumption,

and market shares, 2000-02, January-June 2002, and January-June 2003

Item

Calendar year January-June

2000 2001 2002 2002 2003

Value ($1,000)

U.S. producers’ domestic shipments 2,500,097 2,223,842 2,077,198 1,119,686 958,913

U.S. imports:1

China 432,675 565,551 957,948 404,700 624,601

Nonsubject:

Canada 415,278 414,059 401,392 206,415 200,729

Italy 189,582 185,056 198,556 91,429 90,189

Indonesia 130,582 130,165 151,394 67,795 72,406

Mexico 170,549 145,171 127,553 66,414 49,222

Brazil 43,038 73,216 98,903 44,612 48,479

Malaysia 50,136 44,897 67,979 27,831 50,301

Taiwan 57,749 65,855 64,394 32,097 21,062

Thailand 11,316 19,553 29,810 13,889 16,406

Denmark 20,164 23,258 26,376 11,616 12,098

All other 160,611 162,500 187,150 86,100 102,038

Subtotal, nonsubject 1,249,004 1,263,729 1,353,509 648,197 662,928

Total, all imports 1,681,679 1,829,281 2,311,456 1,052,897 1,287,529

Apparent U.S. consumption 4,181,776 4,053,123 4,388,654 2,172,583 2,246,442

Share of value (percent)

U.S. producers’ domestic shipments 59.8 54.9 47.3 51.5 42.7

U.S. imports:1

China 10.3 14.0 21.8 18.6 27.8

Nonsubject:

Canada 9.9 10.2 9.1 9.5 8.9

Italy 4.5 4.6 4.5 4.2 4.0

Indonesia 3.1 3.2 3.5 3.1 3.2

Mexico 4.1 3.6 2.9 3.1 2.2

Brazil 1.0 1.8 2.3 2.1 2.2

Malaysia 1.2 1.1 1.5 1.3 2.2

Taiwan 1.4 1.6 1.5 1.5 0.9

Thailand 0.3 0.5 0.7 0.6 0.7

Denmark 0.5 0.6 0.6 0.5 0.5

All other 3.8 4.0 4.3 4.0 4.5

Subtotal, nonsubject 29.9 31.2 30.8 29.8 29.5

Total, all imports 40.2 45.1 52.7 48.5 57.3

1

 Official import statistics presented for wooden bedroom furniture are comprised of two HTS statistical reporting numbers: 

9403.50.9040 (wooden beds of a kind used in the bedroom) and 9403.50.9080 (wooden furniture of a kind used in the bedroom

not elsewhere classified). The scope includes two additional HTS statistical reporting numbers under which the subject

merchandise may enter the United States: 9403.90.7000 (furniture parts of wood) and 7009.92.5000 (glass mirrors, framed over

929 cm2

 in reflecting area); however, these other HTS reporting numbers are residual or “basket” categories that also contain

nonsubject imports. To the extent that subject imports enter under the latter HTS statistical reporting numbers, import data may

be understated.

Note.–Because of rounding, figures may not add to totals shown.

Source: Compiled from data submitted in response to Commission questionnaires and Commerce data.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

IV-9

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

3,500,000

4,000,000

4,500,000

5,000,000

2000 2001 2002 January-June

2002

January-June

2003

Value ($1,000) 

U.S. producers Subject imports Nonsubject imports

Figure IV-3

Wooden bedroom furniture: Apparent U.S. consumption, by sources, 2000-02, January-June 2002, and

January-June 2003

Source: Table IV-3.

Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 1 The petition refers to three value categories of wooden bedroom furniture (petition at 3), and respondents

referred to the three quality categories in discussions with staff during the preparation of questionnaires for this

investigation ***.

 2 Ten additional U.S. producers responded that they sold their domestic wooden bedroom furniture in only one of

the quality categories and, therefore, could not discuss differences among the different quality categories.

 3 U.S. producers and importers were also requested to comment in their questionnaire responses about the extent

to which brand-name wooden bedroom furniture is found in each of the three quality categories. Fifteen of the 22

responding U.S. producers and 17 of the 24 responding importers reported that the brand-name furniture is found in

(continued...)

V-1

PART V: PRICING AND RELATED INFORMATION

FACTORS AFFECTING PRICING

Prices of wooden bedroom furniture in the U.S. market can fluctuate based on demand factors

such as the business cycle, sectoral demand fluctuations (e.g., new housing starts), and the product cycle

for wooden bedroom furniture (shifts in consumer tastes). Prices can also fluctuate based on supply

factors such as the amount and complexity of wood-carving detail required, the type(s) of wood required,

the construction techniques, the extent to which solid wood is required instead of fiberboard,

particleboard, or plywood, and to some extent by the distances shipped. Prices of wooden bedroom

furniture also vary depending on the quantity of furniture pieces shipped, as quantity discounts are offered

by many U.S. producers and importers.

Wooden bedroom furniture is used primarily to furnish bedrooms in residential homes and

apartments, but also in hotels/motels, nursing homes, retirement homes, etc. Bedroom furniture made

from bent wood, wicker, metal, and plastic can substitute for wooden bedroom furniture. Changes in

relative prices of the subject wooden bedroom furniture vis-a-vis bedroom furniture of other material

constructions may induce changes in relative demand for these products, but any such substitution may be

limited by consumer preferences for specific styles and designs of bedroom furniture. Part II discusses in

detail substitution between wooden bedroom furniture and alternative constructions of bedroom furniture,

other types of furniture, and other expenditures.

Raw Material Costs, Fit, Finish, and Size/Scale

The principal raw material input used to produce wooden bedroom furniture is wood and/or wood

products, which are included in the materials purchased by U.S. producers to produce wooden bedroom

furniture in the United States; entire raw material costs accounted for about 50.7 percent of U.S.

producers’ total costs of manufacturing wooden bedroom furniture in the United States during January

2000-June 2003.

U.S. producers and importers were requested in their questionnaire responses to discuss

differences in product characteristics for good, better, and best quality categories of domestic and

imported Chinese wooden bedroom furniture that they sold in the United States during January 2000-June

2003.1

 Twenty-four U.S. producers and 34 U.S. importers provided comments regarding differences in

product characteristics of wooden bedroom furniture sold in these quality categories.2

 The questionnaire

comments of the responding firms generally suggested that quality of materials, fit, finish, and size/scale

of the wooden bedroom furniture pieces largely determine the quality category of a given piece of

furniture.3

 Although no precise descriptions are available to define different quality categories,
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 3 (...continued)

all three quality categories, while the remaining seven responding U.S. producers and importers reported that the

brand-name furniture is found predominantly in the better and best quality categories.

Although petitioners asserted that imports from China are a factor in all segments of the U.S. wooden

bedroom furniture market, some information suggests that the imported Chinese furniture may be limited in the highend of the market. Questionnaire responses of U.S. producers and importers discussed in detail in Part II suggest

that, at the high-end of the market, where quantities of any single furniture piece or suite are generally more limited,

such as at the high end of the U.S. wooden bedroom furniture market, imports from China are generally not cost

competitive with U.S. production or imports from some third countries. In addition, respondents asserted that only a

very small fraction of the imports from China (10 percent) are in the high end of the U.S. wooden bedroom furniture

market. See joint respondents’ postconference brief at 22; and ***.

 4 *** frequently sells wooden bedroom furniture to the ***.

V-2

questionnaire responses suggest that the U.S. producers, importers, retailers, and consumers of wooden

bedroom furniture attempt to make such distinctions. The following comments of some of the individual

responding firms are helpful in understanding quality differences, which are still somewhat subjective and

sometimes based on individual consumer preferences/tastes.

*** reported that good quality wooden bedroom furniture involves smaller-scale pieces, minimal

machining, basic finishing, and lower-cost materials. Better quality involves full-size pieces, more

complicated designs, basic finishing, and lower-cost materials. Best quality involves full-size pieces, but

even more complicated designs, complex finishing, and higher quality materials compared with those

used in the better quality category.

*** reported that good quality wooden bedroom furniture has high pressure laminate tops,

paper/non-veneer end panels, and vinyl-wrap drawers.4

 Better quality could also have high pressure

laminate tops, more veneers over solid wood cores, and printed end panels. The firm’s best quality

category has veneer tops and end panels, and more style details such as carvings and solid drawer fronts,

as well as wooden drawer construction.

*** reported that good quality wooden bedroom furniture involves veneers used as face wood;

substrates are engineered wood products such as particleboard, plywood, and fiberboard; drawers are

nailed together and generally unfinished on the interior; and the finish is muddy, opaque, or high sheen. 

Better quality involves full solid woods and veneers; drawers are dovetailed in either French or English

manner and can be lacquered on the interior; and the finish offers more depth and clarity and is available

in one or more options. Best quality involves solid woods and expensive inlaid veneer treatments;

drawers are fully dovetailed and interiors are often finished; and multiple finish options are available.

*** reported that good quality wooden bedroom furniture involves smaller-sized construction,

typically absent of dustproofing; drawer-side construction excludes dovetailing in the front and/or back;

drawers, case sides, face, and tip material are usually composites, not solid wood; and minimum finishing

steps. Better quality involves improvement in some of these latter features. Best quality involves largersized, dustproofed interiors, solid-wood drawer sides, dovetailed front and back, as well as solid and

veneer case construction, and usually multiple finishing steps.

*** reported that major differences in the good, better, and best quality categories of wooden

bedroom furniture are (1) amount of detail, handwork, and carvings; (2) number of stages and details in

the finish; (3) grade or quality of materials; (4) mixing of materials (wood and metal, wood and marble,
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 5 Prices were requested on a net U.S. f.o.b. selling basis. In addition, the number of suites sold were also

requested, but several firms were unable to provide the requested quantity data.

 6 In those instances where firms reported single prices within each quality category instead of price ranges, prices

also varied considerably among the U.S. producers and among importers.

V-3

wood and rattan, etc.); (5) size and scale of furniture pieces; (6) quality of construction; and (7) overall

complexity.

In addition, the U.S. producers and importers were asked to provide ranges of prices for sales to

U.S. retailers during 2002 in each quality category for each of three different wooden bedroom suites: 

(1) 3-piece suites consisting of a bed, dresser (with mirror), and nightstand; (2) 4-piece suites consisting

of a bed, dresser (with mirror), nightstand, and armoire; and (3) 5-piece suites consisting of a bed, dresser

(with mirror), nightstand, armoire, and chest.5

 U.S. producers and importers responded most frequently

with prices for the 4-piece suites, which will be shown and discussed here; reported prices for the other

suites followed a similar pattern as that for the 4-piece suites. Likely reflecting different views of good,

better, and best qualities of wooden bedroom furniture, the range of reported prices differed substantially

among responding U.S. producers and among U.S. importers within each quality category.6

 Price ranges

and simple averages of prices reported by U.S. producers and importers for each of the three quality

categories of the domestic and imported Chinese 4-piece wooden bedroom furniture suites are shown in

table V-1. Sixteen U.S. producers reported selling price ranges for the domestic 4-piece wooden bedroom

furniture suites and 23 U.S. importers reported selling price ranges for the imported Chinese 4-piece

wooden bedroom furniture suites shipped to U.S. retailers during 2002. Each responding firm did not

necessarily report for every quality category of the 4-piece wooden bedroom furniture suites.

Table V-1

Wooden bedroom furniture: Ranges of net U.S. f.o.b. selling prices at the low and high price ends and simple averages

of the reported prices for domestic and imported Chinese 4-piece wooden bedroom furniture suites, by quality

categories, sold to U.S. retailers during 2002

Quality categories

and price end points

United States China

Price range Average price Price range Average price 

Dollars per suite

Good quality:

 Low price end $200-2,305 $873 $400-1,850 $927

 High price end 300-3,199 1,182 700-2,675 1,348

Better quality:

 Low price end 430-2,735 1,183 900-3,000 1,570

 High price end 486-2,875 1,448 1,000-3,500 2,123

Best quality:

 Low price end 495-5,500 2,499 1,000-3,000 1,826

 High price end 545-8,500 3,064 1,200-4,000 2,264

Source: Compiled from data submitted in response to Commission questionnaires.

The price ranges indicate U.S. selling price differences among reporting U.S. producers and 

importers of several hundred dollars per suite in each quality category of the 4-piece wooden bedroom

suites during 2002 (table V-1). The simple average prices, although not weighted by quantities, show an

upward progression from the good-quality furniture suites to the best-quality furniture suites during 2002.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 7 Of the 109 countries that exported wooden bedroom furniture to the United States under HTS subheading

9403.50.90 during this period, only Vietnam paid U.S. tariffs, under the column 2 duty rate, but only during 2000-

01, after which it qualified for the U.S. normal trade relations ad valorem import duty rate of zero.

 8 Staff telephone conversation with ***.

 9 Thirty-eight of 45 responding U.S. producers to this section of the questionnaire and 48 of 54 responding

importers reported that U.S. inland transportation costs were not a significant competitive factor. On the other hand,

the remaining seven responding U.S. producers and six responding U.S. importers reported that U.S. transportation

costs, especially for the longer distances, are a significant competitive factor.

 10 All freight rates were weighted averages based on each firm’s total reported U.S. shipments of its domestic or

imported Chinese wooden bedroom furniture during January 2000-June 2003. 

 11 Although responding U.S. petitioners reported shipping similar relative volumes of their domestic wooden

bedroom furniture in each distance category as that reported by all responding U.S. producers, the petitioners

reported paying somewhat higher freight rates for each distance category. The 23 responding petitioning producers

reported freight rates averaging 5.0 percent of their U.S. f.o.b. selling prices for distances within 100 miles of their

U.S. selling locations, 7.9 percent for distances between 100 and 500 miles, and 11.3 percent for distances greater

than 500 miles. 

V-4

Tariff Rates and Transportation Costs to the U.S. Market

The U.S. normal trade relations ad valorem import duty rate was free for imports of wooden

bedroom furniture from China under HTS subheading 9403.50.90 during January 2000-June 2003.7

Transportation charges for imports of wooden bedroom furniture from China to the U.S. ports of

entry, as a ratio of U.S. official customs values, averaged 18.4 percent during January 2000-June 2003. 

Seventeen of 62 importers, reporting in their questionnaire responses about reasons for any purchase price

changes in their imported Chinese wooden bedroom furniture during January 2000-June 2003,

commented that transportation costs from China to the United States were an important cost factor. An

importing retailer, ***, reported that freight rates from China increased on May 1, 2003 due to general

supply and demand transportation factors and to a jump in U.S. longshoreman’s charges by $1,000 per

container at U.S. ports.8

 Another importer, ***, reported in its questionnaire response that container

freight costs increased by *** percent in May 2003, equaling approximately *** percent of imported

costs.

U.S. Inland Transportation Costs

U.S. producers and importers generally reported in their questionnaire responses that U.S.-inland

freight costs did not represent a significant competitive factor when shipping to their customers in the

U.S. market during January 2000-June 2003.9

 Wooden bedroom furniture products were typically

delivered by truck in the United States during this period and likely exhibited a fairly high value-toweight ratio. The 36 U.S. producers responding to this part of the questionnaire reported that during

January 2000-June 2003 they shipped 11.0 percent of their domestic wooden bedroom furniture to U.S.

customers located within 100 miles of their U.S. plant/warehouse facilities, with U.S. freight costs

averaging 3.5 percent of the U.S. f.o.b. selling price;10 41.1 percent between 100 and 500 miles, with U.S.

freight costs averaging 5.9 percent of the U.S. f.o.b. selling price; and 48.0 percent over 500 miles, with

U.S. freight costs averaging 8.6 percent of the U.S. f.o.b. selling price.11 The 49 responding U.S.

importers reported that during January 2000-June 2003 they shipped 12.8 percent of their imported

Chinese wooden bedroom furniture to U.S. customers located within 100 miles of their U.S. selling

locations, with U.S. freight costs averaging 5.6 percent of the U.S. f.o.b. selling price; 28.1 percent
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 12 Although responding U.S. petitioners that imported the Chinese wooden bedroom furniture tended to ship a

higher relative volumes of their domestic wooden bedroom furniture in the middle distance category compared to

that reported by all responding U.S. importers, the petitioners reported paying somewhat higher freight rates for each

distance category. The 14 responding petitioning producers that imported the Chinese products reported freight rates

averaging 6.4 percent of their U.S. f.o.b. selling prices for distances within 100 miles of their U.S. selling locations,

9.7 percent for distances between 100 and 500 miles, and 13.3 percent for distances greater than 500 miles. 

 13 The length of order lead-times were calculated as simple averages of the number of days reported by the

responding U.S. producers and importers.

 14 Sixteen of these 28 U.S. producers, 14 of whom are petitioning U.S. producers, reported that order lead-times

have fallen as their sales slowed and U.S. inventory levels rose, enabling them to ship their domestic furniture more

quickly during January 2000-June 2003. On the other hand, another eight of these 28 U.S. producers (four are

petitioners) reported that they made improvements in production and order-processing efficiencies to lower their

(continued...)

V-5

between 100 and 500 miles, with U.S. freight costs averaging 8.3 percent of the U.S. f.o.b. selling price;

and 59.1 percent over 500 miles, with U.S. freight costs averaging 11.8 percent of the U.S. f.o.b. selling

price.12 The average U.S.-inland freight rates were based on somewhat fewer responses of U.S. producers

and importers than the number responding for shipment volumes by the three distance categories.

U.S. producers and importers reported in their questionnaire responses the extent to which they

marketed their domestic and imported Chinese wooden bedroom furniture in the United States during

January 2000-March 2003. Thirty-nine of the 44 responding U.S. producers and 42 of the 59 responding

U.S. importers reported that they shipped the wooden bedroom furniture throughout the entire United

States or the continental United States. Four other U.S. producers reported shipping their domestic

wooden bedroom furniture in the Midwest and East coast markets, and the remaining U.S. producer

shipped its products in the West coast and Southwest markets. Eight other U.S. importers reported

shipping their imported Chinese wooden bedroom furniture in the West coast and Southwest markets. 

Another eight U.S. importers reported shipping the imported Chinese furniture in Northeast, Southeast,

and Midwest markets. The remaining U.S. importer reported shipping its imported Chinese furniture in

the East and West coast markets.

A total of 49 U.S. producers reported on the length of order lead-times between a customer’s

order and shipments of their domestic wooden bedroom furniture from U.S. inventory and from U.S.

production during January 2000-June 2003 to their U.S. customers at the wholesale level of the market. 

A total of 59 U.S. importers reported this information for their imported Chinese wooden bedroom

furniture shipped from U.S. inventories and shipped directly from China to their U.S. customers at the

wholesale level of the market. Thirty-five U.S. producers reported order lead-times from U.S. inventory,

which averaged 16 days;13 four of these 35 U.S. producers reported shipping only from their U.S.

inventories. Thirty-eight U.S. producers reported order lead-times from U.S. production, which averaged

42 days; four of these 38 U.S. producers reported shipping only from their U.S. production. Fifty-seven

U.S. importers reported order lead-times from U.S. inventory, which averaged 15 days; six of these 57

U.S. importers reported shipping only from U.S. inventories. Forty-nine U.S. importers reported order

lead-times for shipments directly from China, which averaged 80 days.

Six of 34 responding U.S. producers of domestic wooden bedroom furniture and 45 of 60

responding U.S. importers of the Chinese wooden bedroom furniture reported that order lead-times for

shipments to their U.S. customers did not change during January 2000-June 2003. The remaining 28

responding U.S. producers and another 11 U.S. importers reported that order lead-times have fallen

during this period.14 The remaining four U.S. importers reported that order lead-times increased, at least
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 14 (...continued)

order lead-times to become more competitive during this period. One of these latter U.S. producers, ***, a petitioner

located in ***, reported that in *** its order lead-times were ***, but currently shipping times average *** to 

customers’ warehouses.

 15 International Financial Statistics, IMF, January 2002 and October 2003, p. 234 and p. 274, respectively. 

 16 Asian Nations Gain Indirectly from Dollar’s Declining Value, Keith Bradsher, The New York Times, May 21,

2003.

 17 The real exchange rate indices are calculated from nominal exchange rates, producer/wholesale price indices in

the subject countries, and the producer price index in the United States. Producer selling prices of the subject

product in each country are expected to follow the trend in that country’s overall producer-price level; if subject

product prices in the specified country do not follow the trend in the general price level, the calculated real exchange

rate (which is based on this general price level) would over- or under-estimate the impact of the effect of the actual

changes in domestic prices and exchange rates on U.S. dollar-denominated prices of exports of the subject product. 

 18 The IMF reported that quarterly consumer prices in China fluctuated but generally fell during January 1998-

March 2003 (International Financial Statistics, IMF, January 2002 and October 2003, p. 234 and pp. 275,

respectively). This suggests that there may have been downward price pressure on producer prices in China as well

during this period, which, in turn, would have led to a depreciation in the real value of the yuan vis-a-vis the U.S.

dollar.

 19 Central bank changes in the nominal exchange rates, as well as government changes in allowable bands of

fluctuations around the official exchange rate, constitute devaluations when these actions reduce the exchange-rate

value of the local currency. Depreciation occurs when market forces alone reduce the exchange-rate value of the

local currency. Because devaluation and depreciation frequently occur simultaneously, the term depreciation is

generally used.

 20 Asian Nations Gain Indirectly from Dollar’s Declining Value, Keith Bradsher, The New York Times, May 21,

2003.

V-6

during the period of the U.S. West coast dock strikes (September-December 2002), on their shipments of

the Chinese wooden bedroom furniture.

Exchange Rates

The quarterly nominal value of the Chinese yuan relative to the U.S. dollar remained virtually

unchanged during January 2000-June 2003, at about 8.28 yuan per U.S. dollar, or equivalently, $0.12 per

yuan.15 China’s central bank informally but effectively has tied the yuan’s value to the U.S. dollar.16 A

producer price index for China was not readily available,17 therefore, quarterly real values of the Chinese

yuan relative to the U.S. dollar could not be calculated.18 Some narrative reports indicated, however, that

China has been experiencing mild deflation, with prices falling nearly 1 percent annually. Coupled with

mild inflation in the United States, the Chinese yuan reportedly has depreciated19 against the U.S. dollar

on a price-adjusted basis (real value of the yuan).20 U.S. importers of the Chinese wooden bedroom

furniture reported in their questionnaire responses that there has been no impact of fluctuations in

exchange rates on their purchase prices and sales prices during January 2000-June 2003, because the

value of the Chinese yuan vis-a-vis the U.S. dollar has been relatively constant during this period.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 21 Pricing practices of U.S. producers and importers in selling their U.S.-produced and imported Chinese wooden

bedroom furniture are based on questionnaire responses and refer to sales at the wholesale level of the market, not

retail sales to residential customers. As noted in Part II, wholesale sales are made primarily to furniture retailers, but

also to the hospitality sector, to furniture rental companies, to nursing/retirement homes, vacation resorts, etc.

 22 Forty-four of the 47 responding U.S. producers and 26 of the 33 responding U.S. importers reporting quoting

their selling prices on a U.S. f.o.b. location basis. The three remaining U.S. producers and four other importers

reported quoting prices on a delivered basis, and the three remaining importers reported quoting prices on both a

U.S. f.o.b. and delivered basis.

 23 Twenty-seven of the 44 responding U.S. producers and 29 of the 58 responding U.S. importers that quoted

U.S. f.o.b. prices reported arranging U.S. freight to their customers, while three U.S. producers and 11 importers

reported that they sometimes arranged freight to their customers and at other times their customers arranged freight. 

The remaining 14 U.S. producers and 18 U.S. importer reported that their customers usually arrange the U.S. freight

to their receiving locations.

In responding to how the U.S. freight was billed, twenty-one of the 37 responding U.S. producers and 25 of

the 48 responding importers reported that they typically shipped their domestic and imported Chinese wooden

bedroom furniture freight collect. Two U.S. producers and nine importers reported that they sometimes ship freight

collect and sometime prepay the freight. The remaining 14 U.S. producers and importers reported that they typically

prepay the U.S. freight when shipping to their customers.

 24 Thirty-nine of the 43 U.S. producers and 58 of the 61 U.S. importers responding to the question regarding

freight absorption reported that they generally did not absorb U.S. freight to their customers. The remaining four

U.S. producers and three U.S. importers reported that at times they did absorb U.S. freight to their customers.

V-7

PRICING PRACTICES21

U.S. producers and importers generally quoted prices of their domestic and imported Chinese

wooden bedroom furniture primarily on a U.S. f.o.b. plant/warehouse/port-of-entry basis during January

2000-June 2003.22 When selling on an f.o.b. basis, a majority of U.S. producers and importers reporting

that they usually arranged U.S. freight to their U.S. customers and most frequently shipped their domestic

and imported Chinese wooden bedroom furniture freight collect during January 2000-June 2003.23 U.S.

producers and importers reported that they generally did not absorb U.S. freight to their customers during

January 2000-June 2003.24 In the relatively few instances where the supplier absorbed U.S. freight, it was

done to ship discontinued furniture or replacement pieces, the latter shipped for quality reasons. U.S.

producers and importers also reported their total value of freight absorbed during 2000 and 2002. The

three responding U.S. producers reported absorbing $*** of U.S. freight on their domestic wooden

bedroom furniture during 2000 and $*** during 2002; these amounts are very small, or less than ***

percent of the value of total reported U.S. commercial shipments of domestic wooden bedroom furniture

during 2000 and 2002. The four responding U.S. importers reported absorbing $*** of U.S. freight on

their imported Chinese wooden bedroom furniture during 2000 and $*** during 2002; these amounts are

also very small, or less than .01 percent of the value of total official U.S. imports of Chinese wooden

bedroom furniture during 2000 and 2002.

Based on responses of 36 U.S. producers, 92.9 percent of the total f.o.b. sales value of domestic

wooden bedroom furniture sold to U.S. customers during January 2000-June 2003 was on a spot basis,
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 25 Spot sales are usually one-time delivery, within 30 days of the purchase agreement; short-term sales are for

multiple deliveries for up to 12 months after the purchase agreement; and long-term sales are for multiple deliveries

for more than 12 months after the purchase agreement.

 26 Of the 32 U.S. producers responding, 24 were petitioning producers. The petitioners showed a somewhat

higher share of sales value on a spot basis than that for all producers reporting. The responding petitioners reported

that 98.5 percent of the total f.o.b. sales value of their domestic wooden bedroom furniture sold to U.S. customers

during January 2000-June 2003 was on a spot basis, and 1.5 percent was on a short-term basis; none was reported on

a long-term basis.

 27 Five other U.S. importers that import the Chinese wooden bedroom furniture and ship to their retail outlets also

supplied price lists. Three of these latter five firms showed prices only on an individual furniture piece basis in their

price lists, another firm showed prices both on an individual furniture-piece basis and on a per-suite basis, and the

remaining firm showed prices only on a per-suite basis in its price list.

 28 Thirty-three of the responding 46 U.S. producers and 30 of the 56 responding U.S. importers to questionnaire

requests for their payment terms reported net 30 days as the most typical. Five other responding importers reported

cash on delivery (COD) and four importers reported net 60 days as their payment terms. The remaining 13 U.S.

producers reported a variety of payment terms, usually involving an early-payment reduction ranging from 1.5-5

percent. The remaining 17 importers reported a variety of payment terms for orders shipped directly from China, but

typically did not offer early-payment reductions for such payments.

 29 Twenty-six of 43 responding U.S. producers and 35 of 55 responding U.S. importers reported offering volume 

discounts on sales of their domestic and imported Chinese wooden bedroom furniture during January 2000-June

2003. The remaining 17 responding U.S. producers and 20 responding U.S. importers reported that they did not

offer volume discounts on their domestic and imported Chinese wooden bedroom furniture during this period.

V-8

6.9 percent was on a short-term basis, and 0.2 percent was on a long-term basis.25 26 Based on responses

of 48 U.S. importers selling at the wholesale level of the market, 75.8 percent of the total U.S. f.o.b. sales

value of their wooden bedroom furniture imported from China sold to U.S. customers during January

2000-June 2003 was on a spot basis, 22.7 percent was on a short-term basis, and 1.5 percent was on a

long-term basis.

U.S. producers and importers generally reported using price lists in selling the U.S.-produced and

imported Chinese wooden bedroom furniture at the wholesale level in the U.S. market. Thirty-two U.S.

producers and 23 importers included, as requested, their price lists with their questionnaire responses.27

Twenty-five of the responding U.S. producers and 13 of the responding importers showed prices of their

wooden bedroom furniture produced domestically and imported from China only on an individual

furniture piece basis in their price lists. The remaining seven U.S. producers and 10 importers showed

prices of their wooden bedroom furniture produced domestically and imported from China on both an

individual furniture piece basis and a per-suite basis in their price lists. Thirty-nine U.S. producers and 43

U.S. importers also reported on the frequency of changes in their price lists for their domestic and

imported Chinese wooden bedroom furniture during January 2000-June 2003. Twenty-five responding

U.S. producers and 14 responding U.S. importers reported that they revised their price lists annually or

even less frequently during this period. Another 10 responding U.S. producers and 21 responding

importers reported changing their price lists quarterly or semiannually; and the remaining four U.S.

producers and eight importers reported changing their price lists on an as-needed basis.

U.S. producers and importers generally reported offering payment terms that were typically net

30 days, i.e., without early-payment price reductions, during January 2000-June 2003.28 Many of these

firms, however, offered volume discounts, although such discounts were generally offered on a

competitive basis and not frequently embodied in official discount policies.29 In addition, 28 responding

U.S. producers and 27 responding U.S. importers also reported their total value of discounts extended to
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 30 These U.S. producers’ reported discount amounts as a ratio to the value of total reported U.S. commercial

shipments of domestic wooden bedroom furniture were 3.0 percent in 2000 and 3.3 percent in 2002.

 31 These U.S. importers’ reported discount amounts as a ratio to the value of total official U.S. imports of

Chinese wooden bedroom furniture were 1.4 percent in 2000 and 2.3 percent in 2002.

 32 Sales were requested only to retailers unrelated (by ownership) to the reporting U.S. producers and importers.

 33 These products were suggested by the petitioners as representative of the volumes of U.S.-produced and

subject imported wooden bedroom furniture that competed in the U.S. market during January 2000-June 2003 (staff 

conversations with ***). Staff faxed initial product descriptions received from petitioners to counsel for the

petitioners, importers, and U.S. furniture retailers for comments, but only the petitioners suggested changes, which

were included by the staff.

 34 The questionnaire requested responding firms to report quantities and values of complete beds, including

headboard, footboard, and side rails. For example, if the firm shipped 100 headboards, 90 footboards, and 80 pairs

of side rails, it was asked to report quantities and values for 80 complete beds, using average unit values for all 100

headboards and all 90 footboards to calculate the total value of 80 headboards and 80 footboards to add to the value

of the 80 side rails.

V-9

their U.S. customers during 2000 and 2002 for their domestic and imported Chinese wooden bedroom

furniture. U.S. producers reported total discounts of $75.9 million in 2000 and $67.5 million in 2002,30

while U.S. importers reported total discounts of $6.2 million in 2000 and $22.2 million 2002.31

PRICE DATA

U.S. selling price and quantity data were requested for sales to U.S. furniture retailers32 for the

following eight different products produced in the United States and imported from China:33

Louis Philippe Style Wooden Bedroom Furniture

Product 1A.– Queen-size Louis Philippe Style Sleigh Bed (with Wooden Side Rails):

34

(1) Panel sleigh headboard and panel sleigh footboard, made with either flat or curved

panels, and wooden side rails;

(2) Constructed of hardwood solids and veneers over particleboard or fiberboard, with or

without plywood, no all solid hardwood headboards or footboards, side rails may be

made of plywood;

(3) Made for use with queen-size (5 feet) bedding, but including headboards and footboards

designed to accommodate both full-size (4 feet-six inches) and queen-size (5 feet)

bedding, but not just full size (4 feet-six inches) only; and 

(4) Combined weight of headboard, footboard, and side rails not to exceed 175 pounds total,

when uncartoned and unpacked.

Product 1B.–Louis Philippe Style Double Dresser (6-8 drawers):

(1) Constructed of predominantly hardwood solids and veneers over particleboard or

fiberboard, no all solid hardwood dressers;

(2) Height ranging from 32.5-38.0 inches and width ranging from 62.0-69.0 inches.

Product 1C.–Mirrors Sold with Louis Philippe Style Double Dresser:

(1) Include all mirrors sold with above Louis Philippe Style double dresser.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 35 Ibid.

 36 In addition, importers of the Chinese wooden bedroom furniture that were retailers who sold the imported

products to residential consumers were requested to report their landed, c.i.f., duty-paid import price and quantity

data at the U.S. ports of entry from suppliers unrelated (by ownership) to the importing retailers. 

 37 Petitioners asserted that suppliers ship differing numbers of each different furniture piece to their retailer

customers, such that reportedly producers and importers would not be able to provide their price and quantity sales 

data by furniture suites. Retailers reportedly offer attractive prices for a particular bedroom furniture piece, usually

(continued...)

V-10

Product 1D.–Louis Philippe Style Two and Three Drawer Nightstands ( no Doors): 

(1) Constructed of predominantly hardwood solids and veneers over particleboard or

fiberboard, no all solid hardwood nightstands;

(2) Height ranging from 23.0-29.0 inches and width ranging from 23.0-29.0 inches.

Mission Style Wooden Bedroom Furniture

Product 2A.–Queen-size Mission Style Slat Bed (with Wooden Side Rails):

35

(1) Slat headboard, slat footboard, and wooden side rails;

(2) Constructed of predominantly hardwood solids or hardwood solids and veneers over

particleboard or fiberboard, side rails may be made of plywood;

(3) Made for use with queen-size (5 feet) bedding, including headboards and footboards

designed to accommodate both full-size (4 feet-six inches) and queen-size (5 feet)

bedding, but not just full size (4 feet-six inches) only; and

(4) Combined weight of headboard, footboard, and side rails not to exceed 130 pounds total,

when uncartoned and unpacked.

Product 2B.–Mission Style Dresser (8-10 drawers–no doors OR 6-8 drawers and 1 or 2 doors):

(1) Constructed of predominantly hardwood solids and veneers over particleboard or

fiberboard, no all solid hardwood dressers;

(2) Height ranging from 34-47 inches.

Product 2C.–Mirrors Sold with Above Mission Style Dresser: 

(3) Include all mirrors sold with the above Mission Style dresser.

Product 2D.–Mission Style Two and Three Drawer Nightstands (no Doors):

(1) Constructed of predominantly hardwood solids and veneers over particleboard or

fiberboard, no all sold hardwood nightstands.

(2) Height ranging from 22.5-29.5 inches.

The price data were requested from U.S. producers and importers for their quarterly shipments of

the specified wooden bedroom furniture products 1A-1D and 2A-2D during January 2000-June 2003 that

were produced in the United States and imported from China and sold to U.S. retailers unrelated to the

suppliers. The requested selling price data were based on net U.S. f.o.b. selling prices to retailers (the

wholesale level of the market).36

Although staff had requested that petitioners provide product specifications for complete wooden

bedroom furniture suites for purposes of collecting price data, the petitioners recommended that the

Commission request price data for individual furniture pieces of specified styles and product features.37
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 37 (...continued)

the bed, to entice residential consumers into the store and then try to sell them a full bedroom furniture suite

comprised of two or more pieces. The petitioners asserted that retailers sell a majority of the wooden bedroom

furniture as suites of varying numbers of pieces using this sales strategy, but were not sure of the number of pieces in

a suite. Staff telephone conversation with ***.

 38 Petition, pp. 20-22. As discussed earlier in Part V, a significant number of U.S. producers and importers that

supplied their price lists for wooden bedroom furniture show prices of the wooden bedroom furniture produced

domestically and imported from China only on a furniture-piece basis in those price lists.

 39 The constructed prices for each 4-piece wooden bedroom furniture suite were comprised of the weightedaverage prices for each furniture product in a suite based on price data of all reporting firms. Because different

quantities were reported for each furniture product in a suite by most reporting firms (sometimes reporting no sales

of a particular furniture product in one or more quarters), the total quantity and value of suites associated with the

constructed suite prices could not be determined.

 40 In addition, another 14 importers (retailers that imported the Chinese wooden bedroom furniture for resale to

residential consumers) provided the requested c.i.f., duty-paid import price information, but not necessarily for all

products or periods requested.

 41 The 14 responding U.S. importers that resell their imported Chinese wooden bedroom furniture at their retail

stores reported import shipment values, based on c.i.f., duty-paid import prices, during January 2000-June 2003 that

totaled $23.5 million of wooden bedroom furniture from China, or an additional 0.9 percent (based on unrounded

data) of the total value of official U.S. imports of wooden bedroom furniture from China during this period.

 42 Of the total 14 U.S. producers reporting selling price data, 11 were petitioners.

 43 Of the total 26 U.S. importers reporting selling price data, seven were U.S. producers (three of whom were

petitioners).

V-11

Although the petition emphasized that competition is on a suite-to-suite basis, the petitioners objected to

gathering prices for complete suites.38 The Commission staff used the reported price data of the

individual specified furniture pieces to construct prices for a 4-piece Louis Philippe style suite and a 4-

piece Mission style suite.39

A total of 14 U.S. producers of wooden bedroom furniture and 26 U.S. importers of wooden

bedroom furniture from China provided the requested selling price information, but not necessarily for all

products or periods requested.40 The 14 responding U.S. producers reported shipment values of U.S.-

produced wooden bedroom furniture for pricing purposes that totaled to $268.2 million during January

2000-June 2003, which accounted for 3.5 percent of the total reported U.S. commercial shipment value of

all responding U.S. producers during this period. The 26 responding U.S. importers reported shipment

values for selling price purposes during January 2000-June 2003 that totaled $58.1 million of wooden

bedroom furniture from China, or 2.3 percent of the total value of official U.S. imports of wooden

bedroom furniture from China during this period.41 The value of the reported four-specified Louis

Philippe style furniture pieces accounted for 75.7 percent of the total value of the domestic products

reported for selling price purposes, but 53.2 percent of the total value of the imported Chinese products

reported for selling price purposes. The value of the reported four-specified Mission style furniture

pieces accounted for the remaining 24.3 percent and 46.8 percent, respectively, of the total value of

domestic and imported Chinese products reported for selling price purposes. Petitioners accounted for

56.5 percent of the total value of reported selling price data for the domestic products,42 whereas U.S.

producers accounted for 23.9 percent of the total value of reported selling price data for the imported

Chinese products (petitioning U.S. producers accounted for *** percent).43
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 44 Product aggregation distortions occur with products that are too broadly defined (products of different

specifications and/or quality that, as a result, carry different prices); changes in the composition of the product over

time lead to changes in the weighted-average price of the defined product over time. Such “aggregation-induced”

changes in the weighted-average price of the defined product may mask actual trends in the weighted-average price

due solely to price changes. In addition, product aggregation differences between the domestic and subject imported

products may result in misleading price comparisons between the domestic and Chinese products.

 45 As noted earlier in Part V, volume discounts are offered by many U.S. producers and importers on their U.S.-

produced and imported Chinese wooden bedroom furniture.

 46 Eight of nine U.S. producers reporting prices for the Louis Philippe product 1A (bed) and nine of 11 U.S.

producers reporting prices for the Mission style product 2A (bed) were petitioners. Nine of ten U.S. producers

reporting prices for products 1B-1D and seven of nine U.S. producers reporting prices for products 2B-2D were

petitioners.

 47 The full cost of imports reportedly is approximately *** percent higher than the c.i.f. duty-paid import values. 

See proprietary version of prepared conference testimony of Lynn Chipperfield, Furniture Brands International,

November 18, 2003 at 5. Mr. Chipperfield of Furniture Brands International identified several other costs to

(continued...)

V-12

Significant differences in reported prices among several of the reporting U.S. producers and

among several of the importers for each specified wooden bedroom furniture product likely reflected

several factors including differences in physical characteristics (within the product specifications

provided). Product cycles for wooden bedroom furniture, which questionnaire responses indicate

generally run for about three years but may last as long as eight years, may also contribute to any product

aggregation distortions in the pricing data. U.S. producers and importers reported in their questionnaire

responses that wooden bedroom furniture typically involves a range of quality based on different

construction techniques and materials.44 As noted earlier in Part V, the petition and respondents cited the

existence of different value/quality categories of wooden bedroom furniture. Differences in reported

prices among several of the reporting U.S. producers and importers for each specified furniture product

also appear to reflect differences in the quantities reported.45

The selling price data reported by individual U.S. producers, which were dominated by

petitioning firms,46 showed price differences among the firms of up to $300 per piece or more within each

of the two specified bed products 1A and 2A and within each of the two dresser products 1B and 2B,

whereas price differences of up to $100 per piece or more were found within each of the two specified

mirror products 1C and 2C and within the two nightstand products 1D and 2D. The reported selling price

differences among reporting importers that sold their imported Chinese products to retailers were

generally less than those reported for U.S. producers. Selling price differences among importers for the

specified bed product 1A generally ranged from $200-$300 per piece, while price differences involving

the specified products 1B-1D were usually within $100 per piece within each product. The reported

selling price differences among importers for the specified products 1A and 1B were typically within

$150 per piece within each product and, for the specified products 2C and 2D, price differences typically

ranged from $50-$75 per piece within each product. 

Price trends of the domestic and imported Chinese wooden bedroom furniture products are based

on reported quarterly net U.S. f.o.b. selling price data for sales of the specified wooden bedroom furniture

products and on the staff’s constructed selling prices for a Louis Philippe style 4-piece suite and a

Mission style 4-piece suite; price comparisons between the domestic and subject imported products/suites

are also based on these same price data. The quarterly c.i.f. duty-paid import price data reported by U.S.

retailers are shown and briefly discussed in appendix E. Because these import price data are not selling

prices and reportedly do not reflect the importers’ full costs of importing the Chinese products,47
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 47 (...continued)

importing wooden bedroom furniture from China that are not captured in the c.i.f., duty-paid import values, such as

taxes, additional warehousing, and capital costs of the firm’s money while the Chinese products are in transit, which

would only be reflected in selling prices to U.S. customers. See testimony of Lynn Chipperfield, Senior Vice

President and Chief Administrative Officer, Furniture Brands International at 217-218.

 48 It may be difficult to determine true price and quantity trends of the specified domestic and subject imported

wooden bedroom furniture products due to the product aggregation difficulties noted earlier, including the impact of

the 3- to 8-year product cycle for wooden bedroom furniture and the existence of quantity discounts in wooden

bedroom furniture selling prices. 

V-13

comparisons with U.S. producers’ reported selling price data of their domestically produced products

would be biased, overstating any price underselling and understating any price overselling by the

imported products.

Price Trends48

Trends in the selling price data are shown for the eight specified U.S.-produced wooden bedroom

furniture products in tables V-2 and V-3 and figures V-1 and V-2; the constructed prices of a domestic 

Louis Philippe style 4-piece wooden bedroom furniture suite and a domestic Mission style 4-piece

wooden bedroom furniture suite, based on reported prices of the individual U.S.-produced furniture

pieces, are also shown in these tables and figures. Trends in the selling price data are shown for the eight

specified imported Chinese wooden bedroom furniture products in tables V-4 and V-5 and in figures V-1

and V-2; the constructed prices of an imported Chinese Louis Philippe style 4-piece wooden bedroom

furniture suite and an imported Chinese Mission style 4-piece wooden bedroom furniture suite, based on 

reported prices of the individual imported Chinese furniture pieces, are also shown in these tables and

figures.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

V-14

Table V-2

Wooden bedroom furniture: U.S. weighted-average net f.o.b. selling prices and quantities of U.S.-produced products 1A-1D (Louis Philippe style wooden bedroom

furniture pieces) and constructed 4-piece suite prices, based on sales to retailers, by quarters, January 2000-June 2003 

Period

Product 1A--Bed Product 1B-Dresser Product 1C-Mirror Product 1D-Nightstand

4-piece

suite

Price

(per

piece)

Quantity

(no. of

pieces)

No.

of

firms

Price

(per

piece)

Quantity

(no. of

pieces)

No.

of

firms

Price

(per

piece)

Quantity

(no. of

pieces)

No.

of

firms

Price

(per

piece)

Quantity

(no. of

pieces)

No.

of

firms

Price

 (per

suite)

2000:

 Jan.-Mar. $355.55 15,114 9 $358.78 15,805 10 $124.06 14,723 10 $162.52 30,567 10 $1,000.91

 Apr.-June 350.99 16,089 9 356.27 16,950 10 122.70 15,467 10 162.53 32,035 10 992.49

 July-Sept. 347.07 14,626 9 353.77 14,888 10 119.90 13,894 10 158.56 29,671 10 979.30

 Oct.-Dec. 359.75 13,671 9 373.32 14,322 10 131.30 13,605 10 168.21 29,082 10 1,032.58

2001:

 Jan.-Mar. 358.65 12,835 8 367.43 12,863 10 128.62 11,891 9 164.98 27,717 10 1,019.68

 Apr.-June 347.06 13,588 8 348.62 13,438 10 121.72 13,101 9 162.21 27,337 10 979.61

 July-Sept. 348.07 13,604 8 353.39 14,486 10 124.65 13,596 9 163.83 28,481 10 989.94

 Oct.-Dec. 339.71 11,650 8 358.39 11,371 10 126.48 11,148 9 166.96 22,792 10 991.54

2002:

 Jan.-Mar. 353.86 13,205 9 351.75 13,313 10 126.16 12,805 10 163.89 27,903 10 995.66

 Apr.-June 343.10 11,746 9 365.29 11,994 10 124.63 12,475 10 167.42 25,888 10 1,000.44

 July-Sept. 361.95 9,605 9 377.00 9,766 10 132.63 9,507 10 170.00 21,575 10 1,041.58

 Oct.-Dec. 306.67 7,751 9 371.01 7,842 10 128.32 8,762 10 162.73 18,864 10 968.73

2003:

 Jan.-Mar. 275.85 10,703 9 351.97 9,613 10 121.91 9,749 10 153.96 22,480 10 903.69

 Apr.-June 277.67 10,376 9 357.42 8,515 10 120.68 9,011 10 158.56 19,375 10 914.33

TOTALS 174,563 9 175,166 10 169,734 10 363,767 10

Source: Compiled from data submitted in response to Commission questionnaires.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

V-15

Table V-3

Wooden bedroom furniture: U.S. weighted-average net f.o.b. selling prices and quantities of U.S.-produced products 2A-2D (Mission style wooden bedroom furniture

pieces) and constructed 4-piece suite prices, based on sales to retailers, by quarters, January 2000-June 2003 

Period

Product 2A--Bed Product 2B-Dresser Product 2C-Mirror Product 2D-Nightstand

4-piece

suite

Price

(per

piece)

Quantity

(no. of

pieces)

No.

of

firms

Price

(per

piece)

Quantity

(no. of

pieces)

No.

of

firms

Price

(per

piece)

Quantity

(no. of

pieces)

No.

of

firms

Price

(per

piece)

Quantity

(no. of

pieces)

No.

of

firms

Price (per

suite)

2000:

 Jan.-Mar. $341.28 3,772 9 $410.97 3,963 6 $108.90 3,624 7 $170.75 6,688 8 $1,031.90

 Apr.-June 349.83 4,112 10 444.18 3,861 7 114.09 3,827 8 177.64 6,679 9 1,085.74

 July-Sept. 353.43 4,412 10 425.14 4,644 7 127.72 4,645 8 185.67 7,211 9 1,091.96

 Oct.-Dec. 319.46 5,412 10 410.01 4,347 8 108.23 5,014 8 172.90 8,180 9 1,010.60

2001:

 Jan.-Mar. 332.73 4,805 10 422.16 5,131 8 129.30 4,713 8 186.69 8,593 9 1,070.88

 Apr.-June 331.08 4,389 10 412.18 4,390 8 118.52 4,275 8 180.88 8,086 9 1,042.66

 July-Sept. 346.20 4,683 9 403.02 4,829 7 118.47 4,822 7 179.88 8,269 9 1,047.57

 Oct.-Dec. 329.64 4,590 9 405.31 4,022 7 112.57 3,765 7 178.22 7,128 8 1,025.74

2002:

 Jan.-Mar. 323.52 4,553 9 396.41 4,253 7 110.15 4,371 7 177.51 7,237 8 1,007.59

 Apr.-June 314.91 3,790 9 402.04 3,880 7 114.36 3,771 7 174.60 6,800 8 1,005.91

 July-Sept. 321.74 3,373 9 399.73 3,318 7 112.90 3,281 7 176.25 6,112 8 1,010.62

 Oct.-Dec. 323.99 3,445 9 321.98 4,490 7 89.80 4,590 7 146.90 8,081 8 882.67

2003:

 Jan.-Mar. 310.34 2,843 9 401.32 2,449 8 111.66 2,668 8 170.59 4,995 9 993.91

 Apr.-June 310.10 2,858 9 400.04 2,364 7 108.85 2,532 7 171.93 4,553 9 990.92

TOTALS 57,037 11 55,941 9 55,898 9 98,612 10

Source: Compiled from data submitted in response to Commission questionnaires.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

V-16

Table V-4

Wooden bedroom furniture: U.S. weighted-average net f.o.b. selling prices and quantities of imported Chinese products 1A-1D (Louis Philippe style wooden bedroom

furniture pieces) and constructed 4-piece suite prices, based on sales to retailers, by quarters, January 2000-June 2003 

Period

Product 1A--Bed Product 1B-Dresser Product 1C-Mirror Product 1D-Nightstand

4-piece

suite

Price (per

piece)

Quantity

(no. of

pieces)

No.

of

firms

Price

(per

piece)

Quantity

(no. of

pieces)

No.

of

firms

Price

(per

piece)

Quantity

(no. of

pieces)

No.

of

firms

Price

(per

piece)

Quantity

(no. of

pieces)

No.

of

firms

Price (per

suite)

2000:

 Jan.-Mar. *** *** 1 - - - *** *** 1 - - - -

 Apr.-June *** *** 1 - - - *** *** 1 - - - -

 July-Sept. *** *** 2 *** *** 2 *** *** 3 *** *** 2 $595.80

 Oct.-Dec. *** *** 2 *** *** 3 $85.53 389 4 *** *** 3 669.12

2001:

 Jan.-Mar. *** *** 3 *** *** 2 114.71 821 4 *** *** 2 785.98

 Apr.-June $327.23 417 4 *** *** 3 100.06 872 5 *** *** 2 724.87

 July-Sept. 331.12 386 4 *** *** 3 96.50 838 5 *** *** 2 705.38

 Oct.-Dec. 259.01 2,231 5 $204.70 2,495 4 73.41 2,608 6 *** *** 3 617.09

2002:

 Jan.-Mar. 282.59 2,905 5 130.24 3,527 5 66.88 3,413 6 $69.00 3,418 4 548.71

 Apr.-June 260.32 5,907 10 132.99 5,894 10 65.43 5,899 11 83.86 5,604 10 542.60

 July-Sept. 263.53 5,438 13 131.99 5,713 13 63.90 5,855 14 76.39 5,390 13 535.81

 Oct.-Dec. 253.03 7,048 15 161.60 6,550 15 64.10 6,208 16 85.15 7,829 14 563.88

2003:

 Jan.-Mar. 261.35 9,277 17 179.00 8,370 17 62.22 7,903 18 78.57 12,884 16 581.14

 Apr.-June 262.36 12,242 18 169.55 11,450 18 60.08 10,465 19 79.73 15,968 17 571.72

TOTALS 47,062 20 45,338 19 47,516 21 54,062 18

Source: Compiled from data submitted in response to Commission questionnaires.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

V-17

Table V-5

Wooden bedroom furniture: U.S. weighted-average net f.o.b. selling prices and quantities of imported Chinese products 2A-2D (Mission style wooden bedroom furniture

pieces) and constructed 4-piece suite prices, based on sales to retailers, by quarters, January 2000-June 2003 

Period

Product 2A--Bed Product 2B-Dresser Product 2C-Mirror Product 2D-Nightstand

4-piece

suite

Price

(per

piece)

Quantity

(no. of

pieces)

No.

of

firms

Price

(per

piece)

Quantity

(no. of

pieces)

No.

of

firms

Price

(per

piece)

Quantity

(no. of

pieces)

No.

of

firms

Price

(per

piece)

Quantity

(no. of

pieces)

No.

of

firms

Price (per

suite)

2000:

 Jan.-Mar. *** *** 1 *** *** 2 *** *** 2 *** *** 2 $388.19

 Apr.-June *** *** 1 *** *** 2 *** *** 2 *** *** 2 388.14

 July-Sept. *** *** 3 $222.71 231 4 $82.98 198 4 $82.55 666 4 494.00

 Oct.-Dec. $144.23 1,304 4 204.30 918 5 85.66 767 5 75.43 2,725 5 509.62

2001:

 Jan.-Mar. 182.29 916 7 269.13 789 8 88.18 780 9 93.71 1,268 8 633.31

 Apr.-June 170.66 1,251 7 233.61 1,149 8 78.69 1,132 9 84.10 1,999 8 567.06

 July-Sept. 194.93 2,435 9 259.66 3,501 11 86.80 3,111 11 108.61 6,304 10 650.00

 Oct.-Dec. 225.22 2,488 10 267.47 3,916 11 84.96 3,504 11 110.99 5,933 10 688.64

2002:

 Jan.-Mar. 213.80 4,172 13 265.83 5,746 15 71.48 5,178 14 98.01 9,305 13 649.12

 Apr.-June 230.22 3,966 14 267.40 5,060 14 74.28 3,875 13 100.15 8,351 13 672.05

 July-Sept. 231.88 4,417 14 275.05 5,113 15 69.96 4,640 13 98.20 9,034 13 675.09

 Oct.-Dec. 224.90 5,785 15 279.77 4,945 15 74.09 4,491 15 102.58 9,461 14 681.34

2003:

 Jan.-Mar. 196.22 6,438 17 265.21 6,507 18 68.87 5,880 16 98.19 11,300 16 628.49

 Apr.-June 191.36 7,053 18 240.89 6,684 18 63.68 6,189 17 92.54 11,069 17 588.47

TOTALS 41,565 18 45,139 19 40,172 18 78,925 17

Source: Compiled from data submitted in response to Commission questionnaires.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 49 Weighted-average quarterly selling prices of the domestic Louis Philippe style wooden bedroom furniture

products were 21.9 percent lower during April-June 2003 compared to January-March 2000 for the domestic product

1A (bed), 0.4 percent lower for the domestic product 1B (dresser), 2.7 percent lower for the domestic product 1C

(mirror), and 2.4 percent lower for the domestic product 1D (nightstand) during this period (tableV-2 and figure V1). The quarterly selling prices of the domestic Mission style wooden bedroom furniture products were 9.1 percent

lower during April-June 2003 compared to January-March 2000 for the domestic product 2A (bed), 2.7 percent

lower for the domestic product 2B (dresser), less than 0.1 percent lower for the domestic product 2C (mirror), but 0.7

percent higher for the domestic product 2D (nightstand) during this period (tableV-2 and figure V-2).

Weighted-average quarterly selling prices of the imported Chinese Louis Philippe style wooden bedroom

furniture products were *** percent lower during April-June 2003 compared to January-March 2000 for the Chinese

product 1A (bed), and *** percent lower for the Chinese product 1C (mirror). The quarterly selling prices of the

Chinese product 1B (dresser) were *** percent lower during April-June 2003 compared to July-September 2000

when prices of this Chinese product were first reported, but *** percent higher for the Chinese product 1D

(nightstand) during this period (table V-4 and figure V-1).

 50 Weighted-average selling prices of the imported Chinese Mission style wooden bedroom furniture products

were *** percent higher during April-June 2003 compared to January-March 2000 for the Chinese product 2A (bed),

*** percent higher for the Chinese product 2B (dresser), *** percent higher for Chinese product 2C (mirror), and

*** percent higher for the Chinese product 2D (nightstand) during this period (table V-4 and figure V-2).

V-18

Figure V-1

Wooden bedroom furniture: U.S. weighted-average net f.o.b. selling prices and quantities of U.S.-

produced and imported Chinese products 1A-1D (Louis Philippe style wooden bedroom furniture pieces)

sold to U.S. retailers, by quarters, January 2000-June 2003

*******

Figure V-2

Wooden bedroom furniture: U.S. weighted-average net f.o.b. selling prices and quantities of U.S.-

produced and imported Chinese products 2A-2D (Mission style wooden bedroom furniture pieces) sold to

U.S. retailers, by quarters, January 2000-June 2003

*******

The weighted-average quarterly selling prices of the eight specified U.S.-produced furniture

products and the four specified Louis Philippe imported Chinese products 1A-1D fluctuated but generally 

ended somewhat lower by the end of the period than at the beginning of the period during January 2000-

June 2003, although declines in prices of the two domestic bed products 1A and 2A and the domestic

mirror product 2C were more pronounced. Two exceptions were the weighted-average prices of the

domestic nightstand product 2D and the imported Chinese nightstand product 1D, which actually ended

higher by the end of the period than at the beginning of the period, or when price data were first

reported.49 The weighted-average quarterly selling prices of the four specified Mission style imported

Chinese furniture products 2A-2D fluctuated but generally ended measurably higher at the end of the

period than at the beginning of the period during January 2000-June 2003, with increases in prices of the

imported Chinese bed products 2A (bed) and 2B (dresser) the most pronounced.50 Typically, reported

quarterly quantities of the eight specified domestic wooden bedroom furniture products fluctuated but
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 51 Viewing price data for each responding U.S. importer and Chinese product, 50 quarterly price series for

shipments of the specified imported Chinese wooden bedroom furniture products were reported for the complete or

nearly complete period during January 2000-June 2003. Thirty-four of these quarterly price series showed that

prices of the imported Chinese products increased or were maintained during much of January 2000-June 2003, and

then ended at or above their initial period values. Another seven quarterly price series showed that prices of the

imported Chinese products increased or were maintained through most of the period, but then ended (usually

somewhat) below their initial-period values. The remaining nine quarterly price series showed that prices of the

imported Chinese products generally fell through most of the period, ending below their initial-period values.

 52 The constructed quarterly selling prices of a domestic Louis Philippe style 4-piece wooden bedroom furniture

suite were 8.7 percent lower during April-June 2003 compared to January-March 2000, while the constructed

quarterly selling prices of a domestic Mission style 4-piece wooden bedroom furniture suite were 4.0 percent lower

during this period (tables V-2 and V-3, and figures V-1 and V-2). The constructed quarterly selling prices of an

imported Chinese Louis Philippe style 4-piece wooden bedroom furniture suite were 4.0 percent lower during AprilJune 2003 compared to July-September 2000, the earliest period when such prices could be constructed (table V-4

and figure V-1).

 53 *** reported in its questionnaire response that the downturn in U.S. demand for wooden bedroom furniture

began in mid-2000 and continued through June 2003.

V-19

generally fell during January 2000-June 2003, while reported quarterly quantities of the eight specified

imported Chinese products generally rose.

Because of substantial price differences reported among the responding U.S. producers and

among the U.S. importers, price trends in the aggregate data may differ from actual price trends reported

by the individual reporting U.S. producers and among the reporting U.S. importers. Viewing price data

for each responding U.S. producer and product, 70 quarterly price series for shipments of the specified

domestic wooden bedroom furniture products were reported for the complete or nearly complete period

during January 2000-June 2003. Forty-five of these quarterly price series showed that prices of the

domestic products increased or were maintained during much of January 2000-June 2003, and then ended

at or above their initial period values. Another 16 quarterly price series showed that prices of the

domestic products increased or were maintained through most of the period, but then ended (usually

somewhat) below their initial-period values. The remaining nine quarterly price series showed that prices

of the domestic products generally fell through most of the period, ending below their initial-period

values.51

The constructed quarterly prices of a domestic and imported Chinese Louis Philippe style 4-piece

wooden bedroom furniture suite and a domestic Mission style 4-piece wooden bedroom furniture suite,

both calculated from reported prices of the respective specified furniture products, fluctuated but ended

somewhat lower by the end of the period than at the beginning of the period, or when such prices could

first be constructed, during January 2000-June 2003.52 On the other hand, the constructed quarterly prices

of an imported Chinese Mission style 4-piece wooden bedroom furniture suite, calculated from reported

prices of the respective imported Chinese specified furniture products, fluctuated but ended 51.6 percent

higher during April-June 2003 than during January-March 2000 (table V-5 and figure V-2).

A significant downturn in the U.S. economy during the first three quarters of 2001 and a

generally sluggish economy during January 2002–June 2003 reportedly led to a softness in U.S. demand

for wooden bedroom furniture during at least January 2001-June 2003.53 Although robust new housing

starts during January 2000-June 2003 may have augmented, at least somewhat, demand for new wooden

bedroom furniture during this period, the sluggishness in the overall U.S. economy may have moderated

any price increases since at least January 2001. U.S. importers reported in their questionnaire responses
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 54 Furniture Brands International, a U.S. producer and importer of wooden bedroom furniture (including China),

testified at the staff conference that the price of a wooden bedroom furniture product produced in North Carolina and

sold from a warehouse in North Carolina compared to the price of the same product produced in southeast Asia,

including that from China, and sold from the same warehouse in North Carolina would yield better margins on the

imported product of 3-5 percent after all costs are considered. Mr. Chipperfield also testified that these margins are

not guaranteed because of several cost factors, not incurred by domestic producers, that must be controlled or these

margins could be reduced, eliminated, or turned to losses. The imported product reportedly involves costs of not

only manufacturing, but also loading into containers in Hong Kong, shipping across the ocean, and transporting

across the United States to North Carolina. Mr. Chipperfield also identified some risks in importing as well, such as

a full inventory of the imported furniture in the U.S. warehouse that must be sold and if the supplier under orders he

incurs opportunity costs. See testimony of Lynn Chipperfield, Senior Vice President and Chief Administrative

Officer, Furniture Brands International, conference transcript at 218.

V-20

that changes in material costs in China led to some fluctuations in the importers’ costs of their imported

Chinese wooden bedroom furniture during this period. Increased transportation costs from China to the

United States reportedly also increased costs of their imported Chinese wooden bedroom furniture.

Price Comparisons

Reported quarterly quantities of the domestic and imported Chinese specified wooden bedroom

furniture pieces, especially during 2000-01, were significantly different from each other. Large-volume

sales of U.S. producers and importers were frequently subject to volume discounts during January 2000-

June 2003, such that differences in shipment volumes could lead to misleading price comparisons. Also

hampering price comparisons were the previously discussed product aggregation problems with the

specified furniture products, with wide differences in reported prices of each specified product among

U.S. producers and among U.S. importers. Various levels of quality and the importance of styling in

demand for wooden bedroom furniture (leading to a typical 3-year product cycle) also make price

comparisons difficult. As a result of these market conditions, the quarterly price comparisons discussed

below may not always reflect direct competition between the domestic and imported Chinese wooden

bedroom furniture products.54

A total of 108 quarterly price comparisons were possible between the eight specified domestic

and imported Chinese wooden bedroom furniture products shipped to U.S. retailers on a U.S. f.o.b. net

selling price basis during January 2000-June 2003. These price comparisons are summarized in table V6a and shown in detail in tables V-7 and V-8. In addition, a total of 26 quarterly constructed-selling price

comparisons were possible between a domestic and imported Chinese Louis Philippe style 4-piece

bedroom furniture suite and a Mission style 4-piece bedroom furniture suite, which were based on sales of

the individual specified bedroom furniture pieces in each suite shipped to U.S. retailers on a U.S. f.o.b.

net selling price basis during January 2000-June 2003. These price comparisons are summarized in table

V-6b and shown in detail in tables V-7 and V-8.

One-hundred and seven of the 108 quarterly price comparisons involving the individual eight

specified wooden bedroom furniture products showed that the imported Chinese products were priced less

than the domestic products, by margins ranging from 4.9 percent to 77.2 percent during January 2000-

June 2003, and involved a total of 399,457 pieces of the Chinese furniture, or 99.9 percent of the total

reported number of pieces (399,779) of Chinese furniture involved in all 108 price comparisons (table V6a). The remaining price comparison showed that the imported Chinese furniture product was priced ***

than the domestic product, and involved a quantity representing the remaining 0.1 percent of the total

reported number of pieces of Chinese furniture involved in all 108 price comparisons (table V-6a).
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

V-21

Table V-6a

Wooden bedroom furniture: Summary of quarterly U.S. weighted-average net f.o.b. selling price comparisons between the eight specified U.S.-produced and

imported Chinese wooden bedroom furniture products based on sales to retailers during January 2000-June 2003,1

 and reported Chinese import quantities

involved in the price comparisons

No.2

Total quantity

in number of

furniture

pieces3

Underselling by imports Overselling by imports:

No.2

Quantity in

no. of

pieces3

Share of

quantity in

percent

Range of

underselling

margins in

percent4 No.2

Quantity in

no. of

pieces3

Share of

quantity in

percent

Range of overselling

margins in percent4

The eight specified products combined:

108 399,457 107 399,457 100.0 4.9-77.2 1 *** *** ***

The four specified Louis Philippe style products 1A-1D combined:

52 193,656 51 193,656 100.0 4.9-65.0 1 *** *** ***

The four specified Mission style products 2A-2D combined:

56 205,801 56 205,801 100.0 13.1-77.2 - - - -

 1

 The individual quarterly price comparisons, shown in tables V-7 and V-8, have been combined in this summary table.

 2

 Number of quarterly price comparisons between the U.S.-produced and imported Chinese wooden bedroom furniture products during January 2000-June 2003.

 3

 Reported quantity of specified wooden bedroom furniture pieces imported from China that were involved in price comparisons with the U.S.-produced furniture pieces.

 4

 Based on quarterly price comparisons where under/overselling is measured as the percentage price difference between the domestic and imported Chinese furniture

pieces with respect to the price of the domestic furniture pieces. 

Source: Compiled from data submitted in response to Commission questionnaires.

Table V-6b

Wooden bedroom furniture: Summary of quarterly U.S. weighted-average net f.o.b. selling price comparisons of staff’s

constructed prices between a U.S.-produced and imported Chinese Louis Philippe style 4-piece bedroom furniture suite

and a Mission style 4-piece bedroom furniture suite, which were based on sales of the individual specified bedroom

furniture pieces in each suite to retailers during January 2000-June 20031

Number2

Underselling by imports:

Number2 Range of underselling margins in percent3

Both suite styles combined:

26 26 22.8-64.3

The Louis Philippe style suite:

12 12 22.9-48.6

The Mission style suite:

14 14 22.8-64.3

 1

 The individual quarterly price comparisons, shown in tables V-7 and V-8, have been combined in this summary table.

 2

 Number of quarterly price comparisons between the U.S.-produced and imported Chinese wooden bedroom furniture suites

during January 2000-June 2003.

 3

 Based on quarterly constructed-price comparisons where underselling is measured as the percentage price difference

between the domestic and imported Chinese furniture suites with respect to the price of the domestic furniture suites. 

Note: The constructed prices for each 4-piece wooden bedroom furniture suite were comprised of the weighted-average prices

for each furniture product in each suite based on price data of all reporting firms. Because different quantities were reported for

each furniture product in a suite by most reporting firms (sometimes reporting no sales of a particular furniture product in one or

more quarters), the total quantity and value of suites associated with the constructed suite prices could not be determined.

Source: Compiled from data submitted in response to Commission questionnaires.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

V-22

Table V-7

Wooden bedroom furniture: U.S. weighted-average net f.o.b. selling prices of domestic and imported Chinese wooden bedroom furniture products 1A-1D

(specified Louis Philippe style wooden bedroom furniture pieces) and of the constructed domestic and imported Chinese 4-piece suite price, and margins of

underselling/(overselling), by quarters, January 2000-June 2003

Period

Product 1A-Bed Product 1B-Dresser Product 1C-Mirror

U.S. China U.S. China U.S. China

Price Price Margin Price Price Margin Price Price Margin

Per piece Percent Per piece Percent Per piece Percent

2000:

 Jan.-Mar. $355.55 *** *** $358.78 - - $124.06 *** ***

 Apr.-June 350.99 *** *** 356.27 - - 122.70 *** ***

 July-Sept. 347.07 *** *** 353.77 *** *** 119.90 *** ***

 Oct.-Dec. 359.75 *** *** 373.32 *** *** 131.30 $85.53 34.9

2001:

 Jan.-Mar. 358.65 *** *** 367.43 *** *** 128.62 114.71 10.8

 Apr.-June 347.06 $327.23 5.7 348.62 *** *** 121.72 100.06 17.8

 July-Sept. 348.07 331.12 4.9 353.39 *** *** 124.65 96.50 22.6

 Oct.-Dec. 339.71 259.01 23.8 358.39 $204.70 42.9 126.48 73.41 42.0

2002:

 Jan.-Mar. 353.86 282.59 20.1 351.75 130.24 63.0 126.16 66.88 47.0

 Apr.-June 343.10 260.32 24.1 365.29 132.99 63.6 124.63 65.43 47.5

 July-Sept. 361.95 263.53 27.2 377.00 131.99 65.0 132.63 63.90 51.8

 Oct.-Dec. 306.67 253.03 17.5 371.01 161.60 56.4 128.32 64.10 50.0

2003:

 Jan.-Mar. 275.85 261.35 5.3 351.97 179.00 49.1 121.91 62.22 49.0

 Apr.-June 277.67 262.36 5.5 357.42 169.55 52.6 120.68 60.08 50.2

Continued on the next page.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

V-23

Table V-7--Continued

Wooden bedroom furniture: U.S. weighted-average net f.o.b. selling prices of domestic and imported Chinese wooden

bedroom furniture products 1A-1D (specified Louis Philippe style wooden bedroom furniture pieces) and of the

constructed domestic and imported Chinese 4-piece suite price, and margins of underselling/(overselling), by quarters,

January 2000-June 2003

Period

Product 1D-Nightstand Louis Philippe 4-piece suite

U.S. China U.S. China

Price Price Margin Price Price Margin

Per piece Percent Per suite Percent

2000:

 Jan.-Mar. $162.52 - - $1,000.91 - -

 Apr.-June 162.53 - - 992.49 - -

 July-Sept. 158.56 *** *** 979.30 $595.80 39.2

 Oct.-Dec. 168.21 *** *** 1,032.58 669.12 35.2

2001:

 Jan.-Mar. 164.98 *** *** 1,019.68 785.98 22.9

 Apr.-June 162.21 *** *** 979.61 724.87 26.0

 July-Sept. 163.83 *** *** 989.94 705.38 28.7

 Oct.-Dec. 166.96 *** *** 991.54 617.09 37.8

2002:

 Jan.-Mar. 163.89 $69.00 57.9 995.66 548.71 44.9

 Apr.-June 167.42 83.86 49.9 1,000.44 542.60 45.8

 July-Sept. 170.00 76.39 55.1 1,041.58 535.81 48.6

 Oct.-Dec. 162.73 85.15 47.7 968.73 563.88 41.8

2003:

 Jan.-Mar. 153.96 78.57 49.0 903.69 581.14 35.7

 Apr.-June 158.56 79.73 49.7 914.33 571.72 37.5

Source: Compiled from data submitted in response to Commission questionnaires.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

V-24

Table V-8

Wooden bedroom furniture: U.S. weighted-average net f.o.b. selling prices of domestic and imported Chinese wooden bedroom furniture products 2A-2D

(specified Mission style wooden bedroom furniture pieces) and of the constructed domestic and imported Chinese 4-piece suite price, and margins of

underselling/(overselling), by quarters, January 2000-June 2003

Period

Product 2A-Bed Product 2B-Dresser Product 2C-Mirror

U.S. China U.S. China U.S. China

Price Price Margin Price Price Margin Price Price Margin

Per piece Percent Per piece Percent Per piece Percent

2000:

 Jan.-Mar. $341.28 *** *** $410.97 *** *** $108.90 *** ***

 Apr.-June 349.83 *** *** 444.18 *** *** 114.09 *** ***

 July-Sept. 353.43 *** *** 425.14 $222.71 47.6 127.72 $82.98 35.0

 Oct.-Dec. 319.46 $144.23 54.9 410.01 204.30 50.2 108.23 85.66 20.9

2001:

 Jan.-Mar. 332.73 182.29 45.2 422.16 269.13 36.2 129.30 88.18 31.8

 Apr.-June 331.08 170.66 48.5 412.18 233.61 43.3 118.52 78.69 33.6

 July-Sept. 346.20 194.93 43.7 403.02 259.66 35.6 118.47 86.80 26.7

 Oct.-Dec. 329.64 225.22 31.7 405.31 267.47 34.0 112.57 84.96 24.5

2002:

 Jan.-Mar. 323.52 213.80 33.9 396.41 265.83 32.9 110.15 71.48 35.1

 Apr.-June 314.91 230.22 26.9 402.04 267.40 33.5 114.36 74.28 35.0

 July-Sept. 321.74 231.88 27.9 399.73 275.05 31.2 112.90 69.96 38.0

 Oct.-Dec. 323.99 224.90 30.6 321.98 279.77 13.1 89.80 74.09 17.5

2003:

 Jan.-Mar. 310.34 196.22 36.8 401.32 265.21 33.9 111.66 68.87 38.3

 Apr.-June 310.10 191.36 38.3 400.04 240.89 39.8 108.85 63.68 41.5

Continued on the next page.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

V-25

Table V-8--Continued

Wooden bedroom furniture: U.S. weighted-average net f.o.b. selling prices of domestic and imported Chinese wooden

bedroom furniture products 2A-2D (specified Mission style wooden bedroom furniture pieces) and of the constructed

domestic and imported Chinese 4-piece suite price, and margins of underselling/(overselling), by quarters, January 2000-

June 2003

Period

Product 2D-Nightstand Mission style 4-piece suite

U.S. China U.S. China

Price Price Margin Price Price Margin

Per piece Percent Per suite Percent

2000:

 Jan.-Mar. $170.75 *** *** $1,031.90 $388.19 62.4

 Apr.-June 177.64 *** *** 1,085.74 388.14 64.3

 July-Sept. 185.67 $82.55 55.5 1,091.96 494.00 54.8

 Oct.-Dec. 172.90 75.43 56.4 1,010.60 509.62 49.6

2001:

 Jan.-Mar. 186.69 93.71 49.8 1,070.88 633.31 40.9

 Apr.-June 180.88 84.10 53.5 1,042.66 567.06 45.6

 July-Sept. 179.88 108.61 39.6 1,047.57 650.00 38.0

 Oct.-Dec. 178.22 110.99 37.7 1,025.74 688.64 32.9

2002:

 Jan.-Mar. 177.51 98.01 44.8 1,007.59 649.12 35.6

 Apr.-June 174.60 100.15 42.6 1,005.91 672.05 33.2

 July-Sept. 176.25 98.20 44.3 1,010.62 675.09 33.2

 Oct.-Dec. 146.90 102.58 30.2 882.67 681.34 22.8

2003:

 Jan.-Mar. 170.59 98.19 42.4 993.91 628.49 36.8

 Apr.-June 171.93 92.54 46.2 990.92 588.47 40.6

Source: Compiled from data submitted in response to Commission questionnaires.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

V-26

A total of 52 quarterly price comparisons were possible between the four specified domestic and

imported Chinese Louis Philippe style wooden bedroom furniture products 1A-1D shipped to U.S.

retailers on a U.S. f.o.b. net selling price basis during January 2000-June 2003 (tables V-6a and V-7). 

Fifty-one of the 52 price comparisons showed that the imported Chinese products were priced less than

the domestic products, by margins ranging from 4.9 percent to 65.0 percent, and involved 193,656 pieces

of the Chinese furniture, or 99.8 percent of the total reported number of pieces (193,978) of Chinese

furniture involved in all 52 price comparisons. The single remaining price comparison showed that the

imported Chinese product 1A (bed) was priced *** than the domestic product by *** percent, and

involved 322 pieces of the Chinese furniture, or 0.2 percent of the total reported number of pieces of

Chinese furniture involved in all 52 price comparisons. Price comparisons involving the individual

domestic and imported Chinese Louis Philippe style wooden bedroom furniture products 1A-1D showed

the imported Chinese products to be priced less than the domestic products by margins of 4.9 percent to

27.2 percent for product 1A (bed), 40.2 percent to 65.0 percent for product 1B (dresser), 10.8 percent to

51.8 percent for product 1C (mirror), and 45.0 percent to 57.9 percent for product 1D (nightstand) (table

V-7).

A total of 56 quarterly price comparisons were possible between the four specified domestic and

imported Chinese Mission style wooden bedroom furniture products 2A-2D shipped to U.S. retailers on a

U.S. f.o.b. net selling price basis during January 2000-June 2003 (tables V-6a and V-8). All 56 price

comparisons showed that the imported Chinese products were priced less than the domestic products, by

margins ranging from 13.1 percent to 77.2 percent, and accounted for all reported 205,801 pieces of the

Chinese furniture involved in the 56 price comparisons. Price comparisons involving the individual

domestic and imported Chinese Mission style wooden bedroom furniture products 2A-2D showed the

imported Chinese products to be priced less than the domestic products by margins of 26.9 percent to 77.2

percent for product 2A (bed), 13.1 percent to *** percent for product 2B (dresser), 17.5 percent to 60.6 

percent for product 2C (mirror), and 30.2 percent to 59.8 percent for product 2D (nightstand) (table V-8). 

All 26 quarterly constructed-price comparisons involving a Louis Philippe 4-piece wooden

bedroom furniture suite and a Mission style 4-piece wooden bedroom furniture suite showed that the

imported Chinese furniture suites were priced less than the domestic furniture suites, by margins ranging

from 22.8 percent to 64.3 percent during January 2000-June 2003 (table V-6b). As noted earlier, the

method of constructing furniture suite prices did not enable the staff to calculate the total number or value

of furniture suites associated with these price data. All 12 price comparisons involving the domestic and

imported Chinese Louis Philippe style wooden bedroom furniture suite showed the imported Chinese

furniture suite to be priced less than the domestic furniture suite, by margins of 22.9 percent to 48.6

percent (table V-6b and table V-7). All 14 price comparisons involving the domestic and imported

Chinese Mission style wooden bedroom furniture suite showed the imported Chinese furniture suite to be

priced less than the domestic furniture suite, by margins of 22.8 percent to 64.3 percent (table V-6b and

table V-8). 
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 55 All 16 of these reporting U.S. producers were not petitioners.

 56 A total of 15 U.S. producers alleged losing sales and/or revenues on their domestic wooden bedroom furniture

as a result of competition with the imported Chinese products but were unable to provide details. Twelve of these 15

producers were petitioners and three firms were not petitioners.

 57 ***, two petitioning U.S. producers that alleged lost revenues but were unable to provide specific details, made

some additional comments in this part of their questionnaire responses. *** reported that it did not reduce prices

unique to any single customer, but had an overall price reduction on most of the firm’s case goods in early 2002. 

*** noted that it increased prices on its wooden bedroom furniture only *** since ***, but the increases were for a

selected number of sets only, no across-the-board increases. The firm did not feel it could compete with the

imported Chinese products if it raised prices across-the-board.

 58 The petition also contained several allegations of lost sales involving shipments to U.S. furniture retailers, but

these allegations involved very incomplete information that was insufficient for the staff to follow up.

 59 Staff chose the seven largest of the total 11 specific allegations of lost sales involving the hospitality sector,

which accounts for a relatively small portion of the total U.S. wooden bedroom furniture market, and all of the

specific allegations of lost sales and lost revenue involving the retail sector, which accounts for at least 90 percent of

the U.S. wooden bedroom furniture market.

V-27

LOST SALES AND LOST REVENUES

The Commission requested U.S. producers of wooden bedroom furniture to report in their

questionnaire responses during the preliminary phase of this investigation any instances of lost sales or

revenues they experienced since January 1, 2000, due to competition from imports of wooden bedroom

furniture from China. Sixteen U.S. producers reported in their questionnaire responses that they had not

lost sales of their domestic wooden bedroom furniture due to competition with these products from China,

and 14 of these U.S. producers also reported that they had not lost revenues on sales of their domestic

wooden bedroom furniture due to competition with the imported Chinese products.55 Twelve U.S.

producers alleged in their questionnaire responses that due to competition with the imported Chinese

wooden bedroom furniture they had lost sales of their domestic wooden bedroom furniture and 11 U.S.

producers (eight of the previous 12 producers plus three additional producers) alleged that they had lost

revenues by reducing prices or rolling back price increases of their domestic wooden bedroom furniture,56

but were not able to provide specific examples of any such instances.57

Two petitioning U.S. producers, ***, reported in their questionnaire responses a total of four

specific instances of alleged lost sales and five instances of alleged lost revenues that involved

competition with imported Chinese wooden bedroom furniture; all such instances involved shipments to

U.S. retailers. Another petitioning producer, ***, reported in the petition 11 specific instances of alleged

lost sales; all such sales involved shipments to hospitality firms.58 The total dollar value of the alleged

specific lost sales and lost revenues could not be calculated because this information was not provided in

many of the allegations. For the 20 specific allegations which contained mostly complete information,

staff contacted the purchasers named in 16 of these allegations.59 Nine purchasers responded to staff’s

request for information regarding the specific allegations; eight purchasers responded to lost sales

allegations and one purchaser responded to a lost revenue allegation. A summary of the information

provided for the lost sales and lost revenue allegations that were reported by purchasers is shown in tables

V-9 and V-10, respectively, and a short discussion of purchaser responses follows.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

V-28

Table V-9

Wooden bedroom furniture: U.S. producers’ lost sales allegations

*******

Table V-10

Wooden bedroom furniture: U.S. producers’ lost revenue allegations

*******

*** named ***, a U.S. furniture retailer, in a lost sale allegation. *** asserted that in *** it lost

sales to *** of a total of *** pieces of domestic wooden bedroom furniture, sold by *** per suite, in

competition with wooden bedroom furniture from China. *** disagreed with the lost sales allegation,

stating that the *** bedroom set named in the allegation was replaced with a ***. This latter firm is a

petitioning U.S. producer.

*** named ***, a U.S. furniture retailer, in a lost revenue allegation. *** asserted that in *** it

was forced to reduce its price for ***, totaling *** separate furniture pieces, from $*** per set to $***

per set to meet the price of the imported Chinese products. *** disagreed with the lost revenue allegation. 

It stated that ***.

*** named ***, in a lost sales allegation. *** asserted that in *** it lost sales to *** of ***

domestic wooden bedroom sets, at a total value of $***, because of competition with the imported

Chinese products. *** reported the following information. ***.

*** named ***, a furniture retailer, in a lost sales allegation. *** asserted that in *** it lost sales

to *** of *** domestic wooden bedroom suites, at a total value of $***, because of competition with the

imported Chinese products. *** reported that it “strongly” disagreed with the lost sales allegation. It

stated that both the ***. 

*** named ***, in a lost sales allegation. *** asserted that in *** it lost sales to *** of ***

pieces of domestic wooden bedroom furniture because of competition with imported Chinese products. 

*** disagreed with the lost sales allegation. It provided a detailed response to the allegation, ***. The

separate response provided to staff regarding the allegation stated that the ***. It also stated that ***. 

*** named ***, a furniture retailer, in a lost sales allegation. *** asserted that in *** it lost sales

to *** of *** pieces of domestic wooden bedroom furniture, priced at $*** per suite, because of

competition with imported Chinese products. *** disagreed with the lost sales allegation stating, ***.

*** named ***, in a lost sales allegation. *** asserted that in *** it lost sales to *** of ***

domestic wooden bedroom suites, at a total value of $***, because of competition with imported Chinese

furniture. ***.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

V-29

*** named ***, in a lost sales allegation. *** asserted that in *** it lost sales to *** of ***

domestic wooden bedroom suites, at a total value of $***, because of competition with imported Chinese

furniture. *** disagreed with the lost sales allegation stating that the product was “sourced from another

U.S. producing competitor.”

*** named ***, in a lost sales allegation. *** asserted that in the *** it lost sales to *** of ***

domestic wooden bedroom suites, at a total value of $***, because of competition with imported Chinese

furniture. *** disagreed with the allegation, stating that ***.

Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 1 An additional 13 U.S. producers submitted questionnaire responses. However, their responses were not used

because they either contained no financial data or were significantly incomplete.

 2

 Firms reporting internal consumption were ***.

 3

 Firms reporting transfers to related firms were ***.

 4

 Selected per-unit sales, cost, and operating income (loss) data of the producers on their operations are not

presented in this section since value is a more reliable and accurate measure of U.S. operations than quantity

(quantities are generally not reported in the furniture industry given the variety of the products made in the sector

and there is no uniform measure of quantity) and wooden bedroom furniture is offered for sale in coordinated groups

called bedroom suites or bedroom collections and thus product mix may have a significant impact on the average

per-unit values. In this case, differences in product mix, especially the type of collections, play a major role in the

fluctuations of per-unit sales value and cost, unlike industries in which fluctuations in financial results reflect

changes in the unit selling prices and costs for virtually the same products. Therefore, per-unit selling price and cost

data are not presented in this section.

VI-1

PART VI: FINANCIAL CONDITION OF THE U.S. PRODUCERS

BACKGROUND

Thirty-eight U.S. producers, accounting for approximately 83 percent of U.S. producers’

domestically produced U.S. shipments in 2002, provided usable financial data on their operations on

wooden bedroom furniture during the period examined.1

 Three producers reported internal consumption2

and four producers reported transfers to related firms.3 However, combined internal consumption and

related company transfers were far less than *** percent of the combined companies’ net sales quantity

and value in all periods and thus are not presented separately.

OPERATIONS ON WOODEN BEDROOM FURNITURE

Results of operations of the U.S. producers on their wooden bedroom furniture operations are

presented in table VI-1. Aggregate results of overall operations (including importing) on their wooden

bedroom furniture are shown in table VI-2.4

Based on table VI-1, the quantity sold and the net sales value decreased in each year, contributing

to an annual decline in the operating income. Operating income decreased by $74 million in 2001 from

2000 and further decreased, but to a lesser degree, by $29 million from 2001 to 2002. Both sales volume

and value also decreased from interim 2002 to interim 2003.

The combined results of operations of the U.S. producers on their wooden bedroom furniture

operations remained profitable for the entire period examined. The percentage of operating income to net

sales (operating income margin) decreased continuously from 10.3 percent in 2000 to 8.4 percent in 2001

and to 7.8 percent in 2002.

Aggregate results of overall operations which also included importing activities and presented in

table VI-2 were somewhat better than results of the U.S. manufacturing operations for all periods

examined except 2000.

Selected data for reporting U.S. producers, grouped by net sales revenue, are presented in table

VI-3. All sales ranges had operating income in 2002 except the under $10 million range. Generally,

operating income margins were higher when sales ranges were higher except in the $50-100 million

range.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

VI-2

Table VI-1

Results of manufacturing operations of U.S. producers on wooden bedroom furniture, fiscal years 2000-

02, January-June 2002, and January-June 2003

Item

Fiscal year January-June

2000 2001 2002 2002 2003

Quantity (pieces)

Net sales 14,285,111 13,469,375 12,800,568 6,969,138 6,313,737

Value ($1,000)

Net sales 2,629,870 2,354,403 2,163,578 1,182,222 1,003,183

COGS 2,026,587 1,832,289 1,698,451 909,371 799,406

Gross profit 603,283 522,114 465,127 272,851 203,777

SG&A expenses 331,982 324,653 297,027 154,397 139,041

Operating income 271,301 197,461 168,100 118,454 64,736

Interest expense 16,855 14,050 8,869 5,271 3,832

Other expense 7,364 13,594 6,095 3,686 11,799

Other income 11,208 8,240 6,062 3,138 2,278

Net income 258,290 178,057 159,198 112,635 51,383

Depreciation/amortization 61,280 62,097 55,912 29,828 25,817

Cash flow 319,570 240,154 215,110 142,463 77,200

Ratio to net sales (percent)

COGS 77.1 77.8 78.5 76.9 79.7

Gross profit 22.9 22.2 21.5 23.1 20.3

SG&A expenses 12.6 13.8 13.7 13.1 13.9

Operating income 10.3 8.4 7.8 10.0 6.5

Number of firms reporting

Operating losses 5 8 13 6 18

Data 38 38 38 38 38

 1 Combined internal consumption and company transfers are less than *** percent of the combined companies’ net sales

quantity and value in all periods and are not shown separately. 

 

Source: Compiled from data submitted in response to Commission questionnaires.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

VI-3

Table VI-2

Results of overall operations (including importing) of U.S. producers on wooden bedroom furniture, fiscal

years 2000-02, January-June 2002, and January-June 2003

Item

Fiscal year January-June

2000 2001 2002 2002 2003

Quantity (pieces)

Net sales 15,684,767 15,212,330 15,327,500 8,083,785 7,734,908

Value ($1,000)

Net sales 2,903,134 2,702,507 2,691,675 1,411,024 1,318,006

COGS 2,241,759 2,098,015 2,077,786 1,076,917 1,025,953

Gross profit 661,375 604,492 613,889 334,107 292,053

SG&A expenses 363,935 368,407 356,424 180,068 175,402

Operating income 297,440 236,085 257,465 154,039 116,651

Interest expense 19,376 16,774 11,810 6,304 5,014

Other expense 10,736 17,408 14,739 6,268 12,533

Other income 10,837 7,361 6,400 3,366 2,376

Net income 278,165 209,264 237,316 144,833 101,480

Depreciation/amortization 63,278 64,345 58,860 30,877 27,683

Cash flow 341,443 273,609 296,176 175,710 129,163

Ratio to net sales (percent)

COGS 77.2 77.6 77.2 76.3 77.8

Gross profit 22.8 22.4 22.8 23.7 22.2

SG&A expenses 12.5 13.6 13.2 12.8 13.3

Operating income 10.2 8.7 9.6 10.9 8.9

Number of firms reporting

Operating losses 5 5 9 5 14

Data 38 38 38 38 38

 1 Combined internal consumption and company transfers are less than *** percent of the combined companies’ net sales

quantity and value in all periods and are not shown separately. 

 

Source: Compiled from data submitted in response to Commission questionnaires.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

VI-4

Table VI-3

Selected data for reporting U.S. producers of wooden bedroom furniture, grouped by sales value, fiscal

year 2002 

Sales range

Number of

firms

Number of

firms with an

operating

loss Net sales 

Operating

income/(loss)

Operating

Margin

($1,000) (Percent)

Over $200 million 2 *** *** *** ***

$100-200 million 3 *** *** *** ***

$50-100 million 6 2 431,682 11,475 2.7

$30-50 million 6 0 231,415 11,229 4.9

$10-30 million 15 7 306,116 7,947 2.6

Under $10 million 6 4 35,906 (238) (0.7)

Total/average 38 13 2,163,578 168,100 7.8

Source: Compiled from data submitted in response to Commission questionnaires.

A variance analysis is not presented for this case since the variances in sales revenues and total

costs were largely affected by product mix and there are no reliable per-unit sales price and cost, and sales

quantity, available (the analysis of unit financial data are not presented).

INVESTMENT IN PRODUCTIVE FACILITIES, CAPITAL EXPENDITURES,

AND RESEARCH AND DEVELOPMENT EXPENSES

The responding firms’ aggregate data on capital expenditures, research and development (R&D)

expenses, and the value of their property, plant, and equipment are shown in table VI-4. Capital

expenditures decreased continuously over the period while R&D expenses remained relatively at the same

level throughout the period.

Table VI-4

Capital expenditures, R&D expenses, and assets utilized by U.S. producers in their production of wooden

bedroom furniture, fiscal years 2000-02, January-June 2002, and January-June 20031

Item

Fiscal year January-June

2000 2001 2002 2002 2003

Value ($1,000)

Capital expenditures 72,374 55,872 35,909 16,875 13,955

R&D expenses2 11,573 11,535 11,234 5,494 5,457

Productive facilities:

Original cost 1,150,722 1,160,807 1,136,496 1,150,104 1,118,129

Book value 520,249 494,805 450,691 470,815 432,672

 1 Three producers, ***, did not provide data on capital expenditures, R&D expenses, or asset values.

 2

 Nineteen producers reported R&D expenses.

Source: Compiled from data submitted in response to Commission questionnaires.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

VI-5

CAPITAL AND INVESTMENT

The Commission requested U.S. producers to describe any actual or potential negative effects of

imports of wooden bedroom furniture from China on their firms’ growth, investment, and ability to raise

capital or development and production efforts (including efforts to develop a derivative or more advanced

version of the product). Their responses are shown in appendix F.

Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 1 See 19 U.S.C. § 1677(7)(F)(i)).

 2

 Based on a comparison of the value of Chinese foreign producers’ reported export shipments to the United

States to the value of official import statistics of Commerce.

 3

 The petition identified 133 Chinese foreign producers/exporters of wooden bedroom furniture. See petition at

exh. 6. The Commission posted the foreign producer questionnaire on its web site and distributed it to parties

representing foreign producers in China and to U.S. retailers and importers of the subject merchandise.

 4

 In 2000, Guangdong province represented 30 percent of domestic production and 50 percent of national exports

of furniture. See Research Report on Furniture Industry & Market of China, All China Marketing Research Co.,

June 2001, retrieved at http://store.yahoo.com/chinaonline/resreponfuri.html, December 15, 2003. 

 5

 Chinese National Bureau of Statistics, 2002.

 6

 Landed, duty-paid value for HTS statistical reporting numbers 9403.50.9040 and 9403.50.9080, retrieved at

http://dataweb.usitc.gov/scripts/REPORT.asp on December 16, 2003.

 7

 Japanese Ministry of Finance, 2002 Trade Statistics, retrieved at http://idafij.com/IDAFIJ/Year2002.pdf,

December 16, 2003. 

VII-1

PART VII: THREAT CONSIDERATIONS

The Commission analyzes a number of factors in making threat determinations.1 Information on

the volume and pricing of imports of the subject merchandise is presented in Parts IV and V, and

information on the effects of imports of the subject merchandise on U.S. producers’ existing development

and production efforts is presented in Part VI. Information on inventories of the subject merchandise;

foreign producers’ operations, including the potential for “product-shifting;” any other threat indicators, if

applicable; and any dumping in third-country markets, follows.

THE INDUSTRY IN CHINA

Information on Chinese producers’ production capacity, production, shipments, and inventories is

presented in table VII-1 and figure VII-1. The Chinese industry data are based on the responses of 59

firms estimated to account for 57.0 percent of Chinese exports2

 of the subject merchandise to the United

States in 2002.3

 The reported data show increases in both quantities and values in each year and period

(including projections) for each of the indicators (capacity, production, shipments, and inventories) on

which data were collected.

Furniture production in China has grown significantly since the introduction of market reforms in

1979. In the 1980s, in one of the many byproducts of reforms, the central government allowed for a shift

away from a communist-era focus on the development of heavy industry in the interior regions of the

country to the development of light industry along the coast. Currently, furniture manufacturers are

located throughout southeastern and northeastern China, concentrated primarily in Guangdong province.4

China exports approximately one-third of the furniture that it produces.5 The largest importer of

all Chinese furniture in 2002 was the United States, which purchased 50 percent of China’s $6.6 billion in

exports. Wooden bedroom furniture constituted 30 percent of these $3.3 billion imports, for a total value

of $958 million.6

 The second largest importer of Chinese furniture is Japan, which consumes

approximately 15 percent of Chinese furniture exports. Of Japan’s $950 million in imports of Chinese

furniture, approximately half consist of wooden bedroom furniture.7

 The remainder of Chinese exports

are divided among smaller markets, the most significant of which are Australia, Canada, the European

Union, and the Middle East.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

VII-2

Table VII-1

Wooden bedroom furniture: Data on the industry in China, 2000-02, January-June 2002, January-June 2003, and projections for

2003-041

Item

Actual experience Projections

Calendar year January-June Calendar year

2000 2001 2002 2002 2003 2003 2004

Quantity (pieces)

Capacity 1,773,711 2,787,188 4,503,352 2,142,752 2,818,352 5,866,370 6,613,670

Production 1,754,898 2,604,898 4,691,908 2,024,950 2,614,907 5,765,667 6,702,655

End-of-period inventories 71,330 106,446 222,190 142,868 238,587 274,572 328,338

Shipments:

Home market 837 1,663 2,754 1,150 1,367 2,764 3,427

Internal consumption/transfers 161,013 174,453 203,573 108,015 94,448 202,106 234,860

Exports to:

United States 1,364,632 2,178,251 3,964,404 1,711,995 2,340,449 5,219,923 6,115,779

All other markets2 168,848 204,255 394,590 188,282 194,424 407,367 481,109

Subtotal, exports 1,533,480 2,382,506 4,358,994 1,900,278 2,534,873 5,627,290 6,596,888

Total shipments 1,695,330 2,558,622 4,565,320 2,009,443 2,630,688 5,832,160 6,835,175

Value ($1,000)3

Exports to:

United States 191,007 287,988 546,207 230,249 319,784 708,617 848,665

All other markets2 15,931 20,706 30,923 15,075 21,325 45,611 67,937

Total, exports 206,938 308,695 577,130 245,324 341,109 754,228 916,602

Unit value (dollars per piece)

Exports to:

United States $139.97 $132.21 $137.78 $134.49 $136.63 $135.75 $138.77

All other markets2 94.35 101.38 78.37 80.07 109.68 111.96 141.21

Total, exports 134.95 129.57 132.40 129.10 134.57 134.03 138.94

Ratios and shares based on quantity (percent)3

Capacity utilization 91.6 85.2 95.6 86.2 85.8 90.9 92.8

Inventories/production 4.1 4.1 4.7 3.5 4.6 4.8 4.9

Inventories/shipments 4.2 4.2 4.9 3.6 4.5 4.7 4.8

Share of total shipments:

Home market 0.0 0.1 0.1 0.1 0.1 0.0 0.1

Internal consumption 9.5 6.8 4.5 5.4 3.6 3.5 3.4

Exports to:

United States 80.5 85.1 86.8 85.2 89.0 89.5 89.5

All other markets2 10.0 8.0 8.6 9.4 7.4 7.0 7.0

Total, exports 90.5 93.1 95.5 94.6 96.4 96.5 96.5

1

 Data are based on the responses of 59 Chinese producers believed to account for 57.0 percent of U.S. exports to the United States in

2002. 2

 “All other markets” consists of Australia, Canada, EU, Japan, and the Middle East. 3

 Value data were collected for firms’ export shipments only.

4

 Ratios are calculated using data of only those firms providing both numerator and denominator information.

Note.–Because of rounding, figures may not add to the totals shown.

Source: Compiled from data submitted in response to Commission questionnaires.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

VII-3

90.9% 86.2% 85.8% 92.8%

95.6% 91.6%

85.2%

0

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

7,000,000

8,000,000

2000 2001 2002 Jan.-June

2002

Jan.-June

2003

Projected

2003

Projected

2004

Quantity (pieces) 

0%

25%

50%

75%

100%

Capacity utilization (percent) 

Capacity Production Capacity Utilization

Figure VII-1

Wooden bedroom furniture: China’s capacity, production, and capacity utilization, 2000-02, January-June

2002, and January-June 2003

Source: Table VII-1.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 8 China National Furniture Association.

 9

 Ibid.

 10 See Analysis Report of market Investigations in Chinese Furniture Industry, Hosheng Chen, retrieved at

www.iffd.com.cn/e_tradeinfo_1_1.htm on December 8, 2003.

 11 See China’s Role in the World Trade of Furniture, July 25, 2003, retrieved at

www.2f.com.cn/e/news/hutitle.asp?newsid+204, December 15, 2003.

VII-4

The Chinese furniture industry has realized double-digit growth over the last several years,

increasing from $8.3 billion in 1996 to $20 billion in 2002.8

 The size and organizational structures of

producers also evolved, as township and village enterprises (TVEs), joint ventures, and private

entrepreneurs began to compete with the traditional monopoly of state-owned enterprises (SOEs). The

current number of reported furniture manufacturers is estimated to be over 300,000.9

Although the Chinese furniture industry has experienced measurable growth, there is industry

apprehension that this growth rate may not be sustainable. Representatives of the industry have expressed

concerns, including: a lack of Chinese name brands, poor designs, inadequate market research, lack of

advertising, and increased global competition as WTO-negotiated tariff reductions are fully

implemented.10 Chinese furniture tariffs, which were levied at a rate of 20 percent in 2001, are scheduled

to be eliminated by 2005. However, as discussed below, expectations regarding furniture growth remain

positive, driven by expectations of increasing domestic and foreign demand. 

Domestic consumption of wooden bedroom furniture in China is expected to rise over the longterm. Central government housing reforms have fueled a booming property market which has

consequently increased consumer demand for household products. Since 1995, furniture consumption

has been growing at an average annual rate of 8 percent.11 This increasing demand in tandem with rising

household incomes, strengthens domestic purchasing power and the likelihood of increased consumption

of wooden bedroom furniture. In addition, the belief that a growing tourism industry will be fostered

through events such as the 2008 Olympics increases expectations of a growing demand for wooden

bedroom furniture from the hospitality sector. 

U.S. IMPORTERS’ INVENTORIES

Table VII-2 presents data on U.S. importers’ end-of-period inventories of imported wooden

bedroom furniture. 

U.S. IMPORTERS’ CURRENT ORDERS

Since June 30, 2003, 59 firms have arranged for shipments of subject imports. Table VII-3

presents U.S. importers’ current orders and shipments of wooden bedroom furniture imports from China

between July 1, 2003, and December 31, 2003.

ANTIDUMPING DUTY ORDERS IN THIRD-COUNTRY MARKETS

There are currently no known antidumping duty orders concerning wooden bedroom furniture

from China.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

VII-5

Table VII-2

Wooden bedroom furniture: U.S. importers’ end-of-period inventories of imports, by sources, 2000-02,

January-June 2002, and January-June 20031

Item

Calendar year January-June

2000 2001 2002 2002 2003

Quantity (pieces)

Imports from China 71,330 106,446 222,190 142,868 238,587

Imports from all other sources 265,203 385,455 484,749 471,709 447,051

Total imports 336,533 491,901 706,939 614,577 685,638

Quantity (pounds)

Imports from China 522,258 1,236,244 4,494,723 2,680,636 5,897,737

Imports from all other sources 11,355,641 15,717,391 18,796,944 15,457,174 22,312,563

Total imports 11,877,899 16,953,635 23,291,667 18,137,810 28,210,300

Ratio of inventories to imports (pieces) (percent)

Imports from China 3.5 3.7 4.7 2.6 4.1

Imports from all other sources 16.4 19.0 18.2 17.3 16.7

Total imports 9.3 10.1 9.5 7.5 8.1

Ratio of inventories to imports (pounds) (percent)

Imports from China 0.5 0.6 1.2 0.7 1.5

Imports from all other sources 18.2 17.2 18.5 15.6 18.6

Total imports 6.7 6.0 4.9 3.8 5.5

Ratio of inventories to U.S. shipments of imports (pieces) (percent)

Imports from China 2.0 1.9 1.7 1.5 2.3

Imports from all other sources 9.5 10.8 10.3 10.0 9.3

Total imports 5.3 5.4 4.0 4.2 4.6

Ratio of inventories to U.S. shipments of imports (pounds) (percent)

Imports from China 0.2 0.3 0.6 0.4 0.8

Imports from all other sources 9.3 9.0 9.4 7.9 9.9

Total imports 7 5.9 5.2 4.0 6.0

1

 Data for the value of inventories were not collected.

Note–Import data presented in this table are based on responses to questionnaires of the Commission. Ratios are calculated

using data from firms that provided both numerator and denominator information. Partial-year ratios are calculated using

annualized import and shipment data.

Source: Compiled from data submitted in response to Commission questionnaires.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

VII-6

Table VII-3

Wooden bedroom furniture: U.S. importers’ orders and shipments, July 1, 2003-December 31, 20031

Pieces2 Suites3 Containers

Value

($1,000) Comments

*** *** *** *** *** ***

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*** *** *** *** *** ***

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*** *** *** *** *** ***

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*** *** *** *** *** ***

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*** *** *** *** *** ***

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*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

*** *** *** *** *** ***

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*** *** *** *** *** ***

Total 4,752,704 51,824 1,582 188,422

1

 Firms reported in either pieces, suites, containers, or value. If a company defined a unit, it is listed under “comments.”

2

 Definition of pieces varies between firms. Although the questionnaire requested pieces to be reported as a single piece of furniture (i.e., a bed) some

companies were not able to provide the data in the requested format. Other means of calculating pieces include: counting number of cartons a piece of

furniture is shipped in or counting the headboard and footboard of a bed separately. 3

 In general, suites are understood to include approximately four pieces (bed, dresser, mirror, and nightstand).

Source: Compiled from data submitted in response to Commission questionnaires.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

A-1

APPENDIX A

FEDERAL REGISTER NOTICES

63816 Federal Register / Vol. 68, No. 217 / Monday, November 10, 2003 / Notices 

1Subject merchandise may also be provided for 

in HTS subheadings 7009.92.50 and 9403.90.70.

INTERNATIONAL TRADE 

COMMISSION 

[Investigation No. 731–TA–1058 

(Preliminary)] 

Wooden Bedroom Furniture from 

China

AGENCY: United States International 

Trade Commission.

ACTION: Institution of antidumping 

investigation and scheduling of a 

preliminary phase investigation. 

SUMMARY: The Commission hereby gives 

notice of the institution of an 

investigation and commencement of 

preliminary phase antidumping 

investigation No. 731–TA–1058 

(Preliminary) under section 733(a) of the 

Tariff Act of 1930 (19 U.S.C. 1673b(a)) 

(the Act) to determine whether there is 

a reasonable indication that an industry 

in the United States is materially 

injured or threatened with material 

injury, or the establishment of an 

industry in the United States is 

materially retarded, by reason of 

imports from China of wooden bedroom 

furniture, provided for in subheading 

9403.50.90 of the Harmonized Tariff 

Schedule of the United States (HTS),1

that are alleged to be sold in the United 

States at less than fair value. Unless the 

Department of Commerce extends the 

time for initiation pursuant to section 

732(c)(1)(B) of the Act (19 U.S.C. 

1673a(c)(1)(B)), the Commission must 

reach a preliminary determination in 

antidumping investigations in 45 days, 

or in this case by December 15, 2003. 

The Commission’s views are due at 

Commerce within five business days 

thereafter, or by December 22, 2003.

For further information concerning 

the conduct of this investigation and 

rules of general application, consult the 

Commission’s Rules of Practice and 

Procedure, part 201, subparts A through 

E (19 CFR part 201), and part 207, 

subparts A and B (19 CFR part 207).

EFFECTIVE DATE: October 31, 2003.

FOR FURTHER INFORMATION CONTACT: Fred 

H. Fischer (202–205–3179 or 

ffischer@usitc.gov), Office of 

Investigations, U.S. International Trade 

Commission, 500 E Street SW, 

Washington, DC 20436. Hearingimpaired persons can obtain 

information on this matter by contacting 

the Commission’s TDD terminal on 202–

205–1810. Persons with mobility 

impairments who will need special 

assistance in gaining access to the 

Commission should contact the Office 

of the Secretary at 202–205–2000. 

Federal Register / Vol. 68, No. 217 / Monday, November 10, 2003 / Notices 63817

General information concerning the 

Commission may also be obtained by 

accessing its Internet server (http://

www.usitc.gov). The public record for 

this investigation may be viewed on the 

Commission’s electronic docket (EDIS) 

at http://edis.usitc.gov.

SUPPLEMENTARY INFORMATION: 

Background.—This investigation is 

being instituted in response to a petition 

filed on October 31, 2003, by the 

American Furniture Manufacturers 

Committee For Legal Trade, 

Washington, DC, and its individual 

members, and the Cabinet Makers, 

Millmen, and Industrial Carpenters 

Local 721, Whittier, CA. 

Participation in the investigation and 

public service list.—Persons (other than 

petitioners) wishing to participate in the 

investigation as parties must file an 

entry of appearance with the Secretary 

to the Commission, as provided in 

sections 201.11 and 207.10 of the 

Commission’s rules, not later than seven 

days after publication of this notice in 

the Federal Register. Industrial users 

and (if the merchandise under 

investigation is sold at the retail level) 

representative consumer organizations 

have the right to appear as parties in 

Commission antidumping 

investigations. The Secretary will 

prepare a public service list containing 

the names and addresses of all persons, 

or their representatives, who are parties 

to this investigation upon the expiration 

of the period for filing entries of 

appearance. 

Limited disclosure of business 

proprietary information (BPI) under an 

administrative protective order (APO) 

and BPI service list.—Pursuant to 

§ 207.7(a) of the Commission’s rules, the 

Secretary will make BPI gathered in this 

investigation available to authorized 

applicants representing interested 

parties (as defined in 19 U.S.C. 1677(9)) 

who are parties to the investigation 

under the APO issued in the 

investigation, provided that the 

application is made not later than seven 

days after the publication of this notice 

in the Federal Register. A separate 

service list will be maintained by the 

Secretary for those parties authorized to 

receive BPI under the APO. 

Conference.—The Commission’s 

Director of Operations has scheduled a 

conference in connection with this 

investigation for 9:30 a.m. on November 

21, 2003, at the U.S. International Trade 

Commission Building, 500 E Street SW., 

Washington, DC. Parties wishing to 

participate in the conference should 

contact Fred H. Fischer (202–205–3179 

or ffischer@usitc.gov) not later than 

November 17, 2003, to arrange for their 

appearance. Parties in support of the 

imposition of antidumping duties in 

this investigation and parties in 

opposition to the imposition of such 

duties will each be collectively 

allocated one hour within which to 

make an oral presentation at the 

conference. A nonparty who has 

testimony that may aid the 

Commission’s deliberations may request 

permission to present a short statement 

at the conference. 

Written submissions.—As provided in 

§§ 201.8 and 207.15 of the 

Commission’s rules, any person may 

submit to the Commission on or before 

November 26, 2003, a written brief 

containing information and arguments 

pertinent to the subject matter of the 

investigation. Parties may file written 

testimony in connection with their 

presentation at the conference no later 

than three days before the conference. If 

briefs or written testimony contain BPI, 

they must conform with the 

requirements of §§ 201.6, 207.3, and 

207.7 of the Commission’s rules. The 

Commission’s rules do not authorize 

filing of submissions with the Secretary 

by facsimile or electronic means, except 

to the extent permitted by § 201.8 of the 

Commission’s rules, as amended, 67 FR 

68036 (November 8, 2002). 

In accordance with §§ 201.16(c) and 

207.3 of the rules, each document filed 

by a party to the investigation must be 

served on all other parties to the 

investigation (as identified by either the 

public or BPI service list), and a 

certificate of service must be timely 

filed. The Secretary will not accept a 

document for filing without a certificate 

of service.

Authority: This investigation is being 

conducted under authority of title VII of the 

Tariff Act of 1930; this notice is published 

pursuant to section 207.12 of the 

Commission’s rules.

Issued: November 5, 2003.

By order of the Commission. 

Marilyn R. Abbott, 

Secretary to the Commission.

[FR Doc. 03–28227 Filed 11–7–03; 8:45 am] 

BILLING CODE 7020–02–P
Federal Register / Vol. 68, No. 226 / Monday, November 24, 2003 / Notices 65875

1A chest-on-chest is typically a tall chest-ofdrawers in two or more sections (or appearing to be 

in two or more sections), with one or two sections 

mounted (or appearing to be mounted) on a slightly 

larger chest; also known as a tallboy.

2A highboy is typically a tall chest of drawers 

usually composed of a base and a top section with 

drawers, and supported on four legs or a small chest 

(often 15 inches or more in height).

3A lowboy is typically a short chest of drawers, 

not more than four feet high, normally set on short 

legs.

4A chest of drawers is typically a case containing 

drawers for storing clothing.

5A chest is typically a case piece taller than it 

is wide featuring a series of drawers and with or 

without one or more doors for storing clothing. The 

piece can either include drawers or be designed as 

a large box incorporating a lid.

6A door chest is typically a chest with hinged 

doors to store clothing, whether or not containing 

drawers. The piece may also include shelves for 

televisions and other entertainment electronics.

7A chiffonier is typically a tall and narrow chest 

of drawers normally used for storing undergarments 

and lingerie, often with mirror(s) attached.

8A hutch is typically an open case of furniture 

with shelves that typically sits on another piece of 

furniture and provides storage for clothes.

9An armoire is typically a tall cabinet or 

wardrobe (typically 50 inches or taller), with doors, 

and with one or more drawers (either exterior below 

DEPARTMENT OF COMMERCE

International Trade Administration 

[A–570–890] 

Notice of Request for Information and 

Extension of Time: Wooden Bedroom 

Furniture From the People’s Republic 

of China

AGENCY: Import Administration, 

International Trade Administration, 

Department of Commerce.

ACTION: Notice of request for 

information and extension of time. 

EFFECTIVE DATE: November 24, 2003.

FOR FURTHER INFORMATION CONTACT:

Import Administration, International 

Trade Administration, U.S. Department 

of Commerce, 14th Street and 

Constitution Avenue, NW., Washington, 

DC 20230. Inquiries regarding any 

information on this notice may be 

addressed by calling Import 

Administration at 202–482–3902, via 

fax at 202–482–9089, and via email to 

the following address: 

bedroomfurniture@ita.doc.gov.

The Petition 

On October 31, 2003, the Department 

of Commerce (‘‘Department’’) received 

an antidumping duty petition 

(‘‘Petition’’) filed by the American 

Furniture Manufacturers Committee for 

Legal Trade and its individual members 

(‘‘the Committee’’) and the Cabinet 

Makers, Millmen, and Industrial 

Carpenters Local 721 (‘‘Local 721’’) 

(‘‘collectively, Petitioners’’). The 

Petitioners are domestic producers of 

wooden bedroom furniture. 

Scope of the Petition 

The following language describes the 

imported merchandise from the People’s 

Republic of China (‘‘PRC’’) that 

Petitioners intend to be included in the 

scope of the investigation: 

The merchandise subject to this 

investigation is wooden bedroom 

furniture (i.e., subject merchandise). 

Wooden bedroom furniture is generally, 

but not exclusively, designed, 

manufactured, and offered for sale in 

coordinated groups, or bedrooms, in 

which all of the individual pieces are of 

approximately the same style and 

approximately the same material and/or 

finish. The subject merchandise are 

made substantially of wood products, 

including both solid wood and also 

engineered wood products made from 

wood particles, fibers, or other wooden 

materials such as plywood, oriented 

strand board, particleboard, and 

fiberboard; with or without wood 

veneers, wood overlays, or laminates; 

with or without non-wood components 

or trim such as metal, marble, leather, 

glass, plastic, or other resins; and 

whether or not assembled, completed, 

or finished. 

The subject merchandise includes (1) 

wooden beds such as loft beds, bunk 

beds, and other beds; (2) wooden 

headboards for beds (whether standalone or attached to side rails), wooden 

footboards for beds, wooden side rails 

for beds, and wooden canopies for beds; 

(3) night tables, night stands, dressers, 

commodes, bureaus, mule chests, 

gentlemen’s chests, bachelor’s chests, 

lingerie chests, wardrobes, vanities, 

chessers, chifforobes, and wardrobetype cabinets; (4) dressers with framed 

glass mirrors that are attached to, 

incorporated in, sit on, or hang over the 

dresser; (5) chests-on-chests 1, 

highboys 2, lowboys 3, chests of 

drawers 4, chests 5, door chests 6, 

chiffoniers 7, hutches 8, and armoires 9; 

(6) desks, computer stands, filing 

cabinets, book cases, or writing tables 

that are attached to or incorporated in 

the subject merchandise; and (7) other 

bedroom furniture consistent with the 

above list.

The scope of the petition excludes (1) 

seats, chairs, benches, couches, sofas, 

sofa beds, stools, and other seating 

furniture; (2) mattresses, mattress 

supports (including box springs), infant 

cribs, water beds, and futon frames; (3) 

office furniture, such as desks, stand-up 

desks, computer cabinets, filing 

cabinets, credenzas, and bookcases; (4) 

dining room or kitchen furniture such as 

dining tables, chairs, servers, 

sideboards, buffets, corner cabinets, 

china cabinets, and china hutches; (5) 

other non-bedroom furniture, such as 

television cabinets, cocktails tables, end 

tables, occasional tables, wall systems, 

book cases, and entertainment systems; 

(6) bedroom furniture made primarily of 

wicker, cane, osier, bamboo or rattan; (7) 

side rails for beds made of metal if sold 

separately from the headboard and 

footboard; and (8) bedroom furniture in 

which bentwood parts predominate.10

Imports of subject merchandise are 

classified under statistical category 

9403.50.9040 of the Harmonized Tariff 

Schedule of the United States 

(‘‘HTSUS’’) as ‘‘wooden * * * beds’’

and under statistical category 

9403.50.9080 of the HTSUS as ‘‘other 

* * * wooden furniture of a kind used 

in the bedroom.’’ In addition, wooden 

headboards for beds, wooden footboards 

for beds, wooden side rails for beds, and 

wooden canopies for beds may also be 

entered under statistical category 

9403.50.9040 of the HTSUS as ‘‘parts of 

wood’’ and framed glass mirrors may 

also be entered under statistical category 

7009.92.5000 of the HTSUS as ‘‘glass 

mirrors * * * framed.’’ This 

investigation covers all wooden 

bedroom furniture meeting the above 

description, regardless of tariff 

classification. Although the HTSUS 

subheadings are provided for 

convenience and customs purposes, our 

written description of the scope of this 

proceeding is dispositive.

Domestic Like Product 

Pursuant to Section 771(10) of the 

Tariff Act of 1930, as amended (‘‘the 

65876 Federal Register / Vol. 68, No. 226 / Monday, November 24, 2003 / Notices 

Act’’) and the Petitioners, the product 

that is, ‘‘like, or in the absence of like, 

most similar in characteristics and uses 

with the article subject to investigation’’

is wooden bedroom furniture. 

Determination of Industry Support for 

the Petition 

Section 732(b)(1) of the Act requires 

that a petition be filed on behalf of the 

domestic industry. Section 732(c)(4)(A) 

of the Act provides that the 

Department’s industry support 

determination be based on whether a 

minimum percentage of the relevant 

industry supports the petition. A 

petition meets this requirement if the 

domestic producers or workers who 

support the petition account for: (i) At 

least 25 percent of the total production 

of the domestic like product; and (ii) 

more than 50 percent of the production 

of the domestic like product produced 

by that portion of the industry 

expressing support for, or opposition to, 

the petition. Moreover, section 

732(c)(4)(D) of the Act provides that, if 

the petition does not establish support 

of domestic producers or workers 

accounting for more than 50 percent of 

the total production of the domestic like 

product, the Department shall: (i) Poll 

the industry or rely on other 

information in order to determine if 

there is support for the petition, as 

required by subparagraph (A), or (ii) 

determine industry support using a 

statistically valid sampling method to 

poll the industry. 

Request for Information 

Because the Petition has not 

established that domestic producers or 

workers accounting for more than 50 

percent of the total production of the 

domestic like product support the 

petition, we must ‘‘poll or otherwise 

determine industry support for the 

petition by the industry.’’

In accordance with section 

732(c)(4)(D) of the Act and in order to 

determine whether the petition 

establishes support of domestic 

producers or workers accounting for 

more than 50 percent of the total 

production of the domestic like product, 

we are hereby requesting that all 

domestic producer/manufacturers of the 

wooden bedroom furniture submit to 

the Department a response to the 

questions in Appendix I of this notice. 

Filing Requirements 

Given the very short period in which 

we must determine industry support, 

the number of potential responses, and 

the fact that industry support may not 

be re-examined after initiation, we are 

waiving the filing requirements set forth 

in 19 CFR 351.303 for certain parties 

submitting information on industry 

support. This waiver of the filing 

requirements will not apply to: 1) the 

submission of documents that are not in 

response to the information requested in 

this notice or 2) parties that are familiar 

with the conduct of antidumping and 

countervailing proceedings through 

prior involvement in such proceedings 

(e.g., parties represented by law firms 

that are involved in other AD/CVD 

cases). 

This limited waiver is applicable only 

until November 26, 2003, the deadline 

for submitting the information requested 

in this notice. This waiver is intended 

to expedite the receipt of information 

that is essential to our analysis of 

industry support by providing 

information on the production of the 

domestic like product by petitioning 

and non-petitioning companies. By 

avoiding delays in the receipt of such 

information, we will have more time to 

analyze whether the statutory 

requirements concerning industry 

support for the above-referenced 

petitions have been met. 

All parties submitting any 

information must include the following 

statement in their response: ‘‘I, (name 

and title), currently employed by 

(person), certify that (1) I have read the 

attached submission, and (2) based on 

the information made available to me by 

(person), I have no reason to believe that 

this submission contains any material 

misrepresentation or omission of fact.’’

All information received by the 

Department will be treated as business 

proprietary information as outlined in 

our regulations (19 CFR 351.304–306), 

unless otherwise noted. Please note that 

all company names will be treated as 

public information. In addition, note 

that all business proprietary documents 

received by the Department in response 

to this notice will be served to those 

individuals with access to business 

proprietary information under the 

Administrative Protective Order 

(‘‘APO’’). All public documents may be 

made available to those parties on the 

public service list. The APO service lists 

and the public service lists are available 

on Import Administration’s Web site: 

http://ia.ita.doc.gov.

Information submitted to the 

Department in response to this notice 

should be faxed to the following 

number: 202–482–9089. Furthermore, 

all such information will be placed on 

the official record of the proceeding. 

Responses to this notice are due no later 

than November 26, 2003. Responses 

after this date may not be reviewed by 

the Department and therefore, not 

included in the analysis. 

Extension of Time 

Section 732(c)(1)(A)(ii) of the Act 

provides that within 20 days of the 

filing of an antidumping duty petition, 

the Department will determine, inter 

alia, whether the petition has been filed 

by or on behalf of the U.S. industry 

producing the domestic like product. 

Section 732(c)(1)(B) provides that the 

deadline for the initiation determination 

can be extended by 20 days in any case 

in which the Department must ‘‘poll or 

otherwise determine support for the 

petition by the industry * * *.’’

We will require additional 

information from the petitioners and the 

domestic producers of wooden bedroom 

furniture in order to make our 

determination regarding industry 

support and/or time to analyze the 

petitioners’ responses to our requests for 

information. See Memorandum to 

Joseph A. Spetrini, Deputy Assistant 

Secretary for Import Administration, 

Group III from Edward C. Yang, Office 

Director, AD/CVD Enforcement III, 

Office IX, regarding Antidumping Duty 

Petition on Wooden Bedroom Furniture 

from the People’s Republic of China: 

Extension of Deadline for Determining 

Industry Support, dated November 13, 

2003. Therefore, it is necessary to 

extend the deadline for decision on 

initiation for a period not to exceed 40 

days from the filing of the petition. As 

a result, the initiation determination is 

due no later than December 10, 2003. 

International Trade Commission 

Notification 

Because the Department has extended 

the deadline of the initiation 

determination, the Department will 

contact the Commission and will make 

this extension notice available to the 

Commission.

Dated: November 19, 2003. 

Edward C. Yang, 

Acting Deputy Assistant Secretary for Import 

Administration, Group III.

BILLING CODE 3510–DS–C

Federal Register / Vol. 68, No. 226 / Monday, November 24, 2003 / Notices 65877


EN24NO03.001</GPH>
65878 Federal Register / Vol. 68, No. 226 / Monday, November 24, 2003 / Notices 


EN24NO03.002</GPH>
Federal Register / Vol. 68, No. 226 / Monday, November 24, 2003 / Notices 65879

[FR Doc. 03–29419 Filed 11–21–03; 8:45 am] 

BILLING CODE 3510–DS–C

70228 Federal Register / Vol. 68, No. 242 / Wednesday, December 17, 2003 / Notices 

1A chest-on-chest is typically a tall chest-ofdrawers in two or more sections (or appearing to be 

in two or more sections), with one or two sections 

mounted (or appearing to be mounted) on a slightly 

larger chest; also known as a tallboy.

2A highboy is typically a tall chest of drawers 

usually composed of a base and a top section with 

drawers, and supported on four legs or a small chest 

(often 15 inches or more in height).

DEPARTMENT OF COMMERCE

International Trade Administration

[A-570–890]

Initiation of Antidumping Duty 

Investigation: Wooden Bedroom 

Furniture from the People’s Republic 

of China

AGENCY: Import Administration, 

International Trade Administration, 

Department of Commerce.

EFFECTIVE DATE: December 17, 2003.

FOR FURTHER INFORMATION CONTACT: Alex 

Villanueva or Robert Bolling, Import 

Administration, International Trade 

Administration, U.S. Department of 

Commerce, 14th Street and Constitution 

Avenue, NW, Washington, DC 20230; 

telephone: (202) 482–3208 and (202) 

482–3434, respectively.

SUPPLEMENTARY INFORMATION:

INITIATION OF INVESTIGATION

The Petition

On October 31, 2003, the Department 

of Commerce (‘‘Department’’) received a 

Petition on imports of wooden bedroom 

furniture from the People’s Republic of 

China (‘‘China’’) (‘‘Petition’’) filed in 

proper form by the American Furniture 

Manufacturers Committee for Legal 

Trade (‘‘Committee’’) and its individual 

members and the Cabinet Makers, 

Millmen, and Industrial Carpenters 

Local 721 (collectively, ‘‘the 

Petitioners’’) on behalf of the domestic 

industry and workers producing 

wooden bedroom furniture. On 

November 6, 2003 and November 10, 

2003, the Department requested 

clarification of certain areas of the 

Petition and received responses to both 

requests on November 12, 2003. On 

November 12, 2003, Markor 

International Furniture (Tianjin) 

Manufacturing Co., (‘‘Markor’’) and 

Lacquer Craft Manufacturing Company, 

Ltd., (‘‘Lacquer’’) submitted comments 

regarding the industry support for the 

Petition. On November 13, 2003, the 

Department received comments from 

Furniture Brands International, Inc. 

(‘‘FBI’’). On November 20, 2003, the 

Petitioners amended the Petition to 

include an additional margin estimate 

for a product within the scope of the 

investigation. On November 24, 2003, 

the Department published a notice in 

the Federal Register extending the 

twenty-day initiation determination 

deadline and requesting information 

from domestic producers of wooden 

bedroom furniture See Notice of Request 

for Information and Extension of Time: 

Wooden Bedroom Furniture from the 

People’s Republic of China (‘‘Extension 

Notice’’) 68 FR 65875 (November 24, 

2003). On November 24, 2003, the 

Department requested from the 

Petitioners that certain business 

proprietary information be made public. 

On November 28, 2003, the Department 

received the public version of the 

business proprietary information 

requested on November 24, 2003. On 

December 2, 2003, the Department 

received additional comments regarding 

industry support from Markor and 

Lacquer. Additionally, on December 2, 

2003, the Department received 

comments from the Petitioners 

regarding opposition to the Petition. On 

December 3, 2003, the Department 

received rebuttal comments to Markor’s 

and Lacquer’s December 2, 2003 

comments from the Petitioners. On 

December 3, 2003, the Department 

received comments from the Petitioners 

regarding the calculation of industry 

support. On December 4, 2003, the 

Petitioners amended the Petition adding 

four certified labor unions as 

Petitioners. Additionally, on December 

4, 2003, FBI submitted comments 

regarding the calculation of industry 

support. On December 5, 2003, the 

Department received comments from 

Markor and Lacquer. On December 8, 

2003, the Department received 

comments from FBI and Markor and 

Lacquer. On December 9, 2003 the 

Department received comments from 

the Petitioners. Additionally, on 

December 9, 2003, the Department 

received a request from the Petitioners 

that the Department reject numerous 

submissions submitted earlier in this 

proceeding in accordance with Section 

732(b)(3)(B) of the Tariff Act of 1930, as 

amended (‘‘the Act’’). On December 9, 

2003, the Department returned FBI’s 

comments of December 8, 2003. See 

Memorandum to the File from Lisa 

Shishido, Case Analyst, Regarding 

Wooden Bedroom Furniture from the 

People’s Republic of China, dated 

December 9, 2003. We note that in FBI’s 

November 13, 2003 comments and 

Markor and Lacquer’s December 8, 2003 

comments, both parties included 

comments on issues other than industry 

support, we did not reject those 

submission because they contained 

information regarding industry support. 

See Memo to the File from Alex 

Villanueva, Senior Case Analyst, 

Regarding Wooden Bedroom Furniture 

from the People’s Republic of China: 

FBI’s November 13, 2003 Comments and 

Markor and Lacquer’s December 8, 2003 

Comments, dated December 9, 2003. 

However, we did not consider FBI’s 

December 8, 2003 comments and 

Markor and Lacquer’s December 8, 2003 

comments that were not on industry 

support. See Import Administration: 

Antidumping Duty Investigation 

Initiation Checklist of Wooden Bedroom 

Furniture from China(‘‘Initiation 

Checklist’’), dated December 10, 2003 at 

Attachment III. December 10, 2003, FBI 

revised their comments from December 

8, 2003.

In accordance with section 732(b) of 

the Ac, the Petitioners allege that 

imports of wooden bedroom furniture 

from China are being, or are likely to be, 

sold in the United States at less than fair 

value within the meaning of section 731 

of the Act, and that such imports are 

materially injuring and threaten to 

injury and industry in the United States.

Scope of Investigation

For purposes of this investigation, the 

product covered is wooden bedroom 

furniture (i.e., subject merchandise). 

Wooden bedroom furniture is generally, 

but not exclusively, designed, 

manufactured, and offered for sale in 

coordinated groups, or bedrooms, in 

which all of the individual pieces are of 

approximately the same style and 

approximately the same material and/or 

finish. The subject merchandise are 

made substantially of wood products, 

including both solid wood and also 

engineered wood products made from 

wood particles, fibers, or other wooden 

materials such as plywood, oriented 

strand board, particle board, and 

fiberboard; with or without wood 

veneers, wood overlays, or laminates; 

with or without non-wood components 

or trim such as metal, marble, leather, 

glass, plastic, or other resins; and 

whether or not assembled, completed, 

or finished.

The subject merchandise includes (1) 

wooden beds such as loft beds, bunk 

beds, and other beds; (2) wooden 

headboards for beds (whether standalone or attached to side rails), wooden 

footboards for beds, wooden side rails 

for beds, and wooden canopies for beds; 

(3) night tables, night stands, dressers, 

commodes, bureaus, mule chests, 

gentlemen’s chests, bachelor’s chests, 

lingerie chests, wardrobes, vanities, 

chessers, chifforobes, and wardrobetype cabinets; (4) dressers with framed 

glass mirrors that are attached to, 

incorporated in, sit on, or hang over the 

dresser; (5) chests-on-chests1, highboys2, 

Federal Register / Vol. 68, No. 242 / Wednesday, December 17, 2003 / Notices 70229

3A lowboy is typically a short chest of drawers, 

not more than four feet high, normally set on short 

legs.

4A chest of drawers is typically a case containing 

drawers for storing clothing

5A chest is typically a case piece taller than it 

is wide featuring a series of drawers and with or 

without one or more doors for storing clothing. The 

piece can either include drawers or be designed as 

a large box incorporating a lid.

6A door chest is typically a chest with hinged 

doors to store clothing, whether or not containing 

drawers. The piece may also include shelves for 

televisions and other entertainment electronics.

7A chiffonier is typically a tall and narrow chest 

of drawers normally used for storing undergarments 

and lingerie, often with mirror(s) attached.

8A hutch is typically an open case of furniture 

with shelves that typically sits on another piece of 

furniture and provides storage for clothes.

9An armoire is typically a tall cabinet or 

wardrobe (typically 50 inches or taller), with doors, 

and with one or more drawers (either exterior below 

or above the doors or interior behind the doors), 

shelves, and/or garment rods or other apparatus for 

storing clothes. Bedroom armoires may also be used 

to hold television receivers and/or other audiovisual entertainment systems.

10As used herein, bentwood means solid wood 

made pliable. Bentwood is wood that is brought to 

a curved shape by bending it while made pliable 

with moist heat or other agency, and then set by 

cooling or drying. See Customs’ Headquarters’

Ruling Letter 043859, dated May 17, 1976.

lowboys3, chests of drawers4, chests5, 

door chests6, chiffoniers7, hutches8, and 

armoires9; (6) desks, computer stands, 

filing cabinets, book cases, or writing 

tables that are attached to or 

incorporated in the subject 

merchandise; and (7) other bedroom 

furniture consistent with the above list.

The scope of the Petition excludes (1) 

seats, chairs, benches, couches, sofas, 

sofa beds, stools, and other seating 

furniture; (2) mattresses, mattress 

supports (including box springs), infant 

cribs, water beds, and futon frames; (3) 

office furniture, such as desks, stand-up 

desks, computer cabinets, filing 

cabinets, credenzas, and bookcases; (4) 

dining room or kitchen furniture such as 

dining tables, chairs, servers, 

sideboards, buffets, corner cabinets, 

china cabinets, and china hutches; (5) 

other non-bedroom furniture, such as 

television cabinets, cocktails tables, end 

tables, occasional tables, wall systems, 

book cases, and entertainment systems; 

(6) bedroom furniture made primarily of 

wicker, cane, osier, bamboo or rattan; (7) 

side rails for beds made of metal if sold 

separately from the headboard and 

footboard; and (8) bedroom furniture in 

which bentwood parts predominate.10

Imports of subject merchandise are 

classified under statistical category 

9403.50.9040 of the Harmonized Tariff 

Schedule of the United States 

(‘‘HTSUS’’) as ‘‘wooden * * * beds’’

and under statistical category 

9403.50.9080 of the HTSUS as ‘‘other 

* * * wooden furniture of a kind used 

in the bedroom.’’ In addition, wooden 

headboards for beds, wooden footboards 

for beds, wooden side rails for beds, and 

wooden canopies for beds may also be 

entered under statistical category 

9403.50.9040 of the HTSUS as ‘‘parts of 

wood’’ and framed glass mirrors may 

also be entered under statistical category 

7009.92.5000 of the HTSUS as ‘‘glass 

mirrors...framed.’’ This investigation 

covers all wooden bedroom furniture 

meeting the above description, 

regardless of tariff classification. 

Although the HTSUS subheadings are 

provided for convenience and customs 

purposes, our written description of the 

scope of this proceeding is dispositive.

During our review of the Petition, we 

discussed the scope with the Petitioners 

to ensure that it accurately reflects the 

product for which the domestic industry 

is seeking relief. Moreover, as discussed 

in the preamble to the Department’s 

regulations, we are setting aside a 

period for interested parties to raise 

issues regarding product coverage. See 

Antidumping Duties; Countervailing 

Duties; Final Rule, 62 FR 27295, 27323 

(1997). The Department encourages all 

interested parties to submit such 

comments within 20 calendar days of 

publication of this notice.

Comments should be addressed to 

Import Administration’s Central 

Records Unit at Room 1870, U.S. 

Department of Commerce, 14th Street 

and Constitution Avenue, NW, 

Washington, DC 20230. The period of 

scope consultations is intended to 

provide the Department with ample 

opportunity to consider all comments 

and consult with interested parties prior 

to the issuance of the preliminary 

determination.

Determination of Industry Support for 

the Petition

Section 732(b)(1) of the Act requires 

that a Petition be filed on behalf of the 

domestic industry. Section 732(c)(4)(A) 

of the Act provides that the 

Department’s industry support 

determination, which is to be made 

before the initiation of the investigation, 

be based on whether a minimum 

percentage of the relevant industry 

supports the Petition. A Petition meets 

this requirement if the domestic 

producers or workers who support the 

Petition account for: (i) at least 25 

percent of the total production of the 

domestic like product; and (ii) more 

than 50 percent of the production of the 

domestic like product produced by that 

portion of the industry expressing 

support for, or opposition to, the 

Petition. Moreover, section 732(c)(4)(D) 

of the Act provides that, if the Petition 

does not establish support of domestic 

producers or workers accounting for 

more than 50 percent of the total 

production of the domestic like product, 

the Department shall: (i) poll the 

industry or rely on other information in 

order to determine if there is support for 

the Petition, as required by 

subparagraph (A), or (ii) determine 

industry support using a statistically 

valid sampling method.

Section 771(4)(A) of the Act defines 

the ‘‘industry’’ as the producers of a 

domestic like product. Thus, to 

determine whether a Petition has the 

requisite industry support, the statute 

directs the Department to look to 

producers and workers who produce the 

domestic like product. The International 

Trade Commission (‘‘ITC’’), which is 

responsible for determining whether 

‘‘the domestic industry’’ has been 

injured, must also determine what 

constitutes a domestic like product in 

order to define the industry. While both 

the Department and the ITC must apply 

the same statutory definition regarding 

the domestic like product (section 

771(10) of the Act), they do so for 

different purposes and pursuant to a 

separate and distinct authority. In 

addition, the Department’s 

determination is subject to limitations of 

time and information. Although this 

may result in different definitions of the 

like product, such differences do not 

render the decision of either agency 

contrary to law. See USEC, Inc. v. 

United States, 132 F. Supp. 2d 1, 8 (Ct. 

Int’l Trade 2001), citing Algoma Steel 

Corp. Ltd. v. United States, 688 F. Supp. 

639, 642–44 (Ct. Int’l Trade 1988).

Section 771(10) of the Act defines the 

domestic like product as ‘‘a product 

which is like, or in the absence of like, 

most similar in characteristics and uses 

with, the article subject to an 

investigation under this title.’’ Thus, the 

reference point from which the 

domestic like product analysis begins is 

‘‘the article subject to an investigation,’’

i.e., the class or kind of merchandise to 

be investigated, which normally will be 

the scope as defined in the Petition.

With regard to the domestic like 

product, Petitioner does not offer a 

definition of domestic like product 

distinct from the scope of the 

investigation. Based on our analysis of 

the information submitted in the 

Petition we have determined there is a 

single domestic like product, wooden 

bedroom furniture, which is defined 

further in the ‘‘Scope of the 

Investigations’’ section above, and we 

have analyzed industry support in terms 

of that domestic like product.

Based on information provided in the 

Petition, the share of total estimated 

U.S. production of the domestic like 

product in calendar year 2002 

70230 Federal Register / Vol. 68, No. 242 / Wednesday, December 17, 2003 / Notices 

represented by the Petitioners and the 

supporting domestic producers equal 

over 25 percent of total domestic 

production but less than 50 percent of 

production of the domestic like product 

produced by that portion of the industry 

expressing support for, or opposition to, 

the Petition. See Extension Notice. 

Therefore, in accordance with 

732(c)(4)(D) of the Act, we polled the 

industry.

On November 13, 2003, November 17, 

2003 and November 19, 2003, we issued 

polling questionnaires to all known 

producers of wooden bedroom furniture 

identified in the Petition, listed on the 

Thomas Register and found on the 

internet by the Department. The 

combined list contained 264 companies. 

See Memorandum to the File from 

Michael Holton, Case Analyst, 

Regarding the Addresses for All Parties 

the Department of Commerce Sent the 

Polling Questionnaire to on November 

13, 2003 (‘‘Addresses Memo’’), dated 

November 14, 2003. The addresses 

attached to the Addresses Memo were 

also used when sending the revised 

questionnaires dated November 17, 

2003 and November 19, 2003. See 

Memorandum to the File from Alex 

Villanueva, Case Analyst, Regarding the 

Addresses for All Parties the 

Department of Commerce Sent the 

Polling Questionnaire on November 17, 

2003 and November 19, 2003, dated 

December 3, 2003. The questionnaires 

are on file in the Central Records Unit 

(‘‘CRU’’) in room B-099 of the main 

Department of Commerce building. 

Additionally, the final questionnaire 

dated November 19, 2003 was available 

on the Import Administration website. 

As noted earlier, the Department also 

published a notice in the Federal 

Register extending the twenty-day 

initiation determination deadline and 

requesting information from domestic 

producers of wooden bedroom 

furniture. See Extension Notice at 

65877, 65878. We requested that each 

company complete the polling 

questionnaire and certify their 

responses and requested that all 

companies respond no later than 

November 26, 2003 by faxing their 

responses to the Department at (202) 

482–9089.

By the deadline of November 26, 

2003, the Department received a total of 

104 responses. See Memorandum to the 

File from Alex Villanueva, Case 

Analysts through Robert A. Bolling, 

Program Manager and Edward C. Yang, 

Office Director, Regarding the 

Calculation of Industry Support (‘‘Memo 

on Industry Support’’), dated December 

10, 2003 at Attachment II of the 

Initiation Checklist. Any responses 

received after this date were not 

included in our analysis. See Extension 

Notice at 65876 and Initiation Checklist

at Attachment II. The Department will 

be returning all polling questionnaire 

responses not received by November 26, 

2003. Pursuant to section 351.104 of the 

Department’s regulations, the 

Department has relied upon the 

responses to this questionnaire and 

follow-up phone calls to clarify certain 

responses to determine industry 

support. For a log of the phone calls 

made by the Department, please see the 

Memorandum to the File from Lisa 

Shishido, Case Analyst, Regarding the 

Telephone Call Log Clarifying 

Information Received by the 

Department, dated December 10, 2003. 

For a detailed discussion of the 

responses received please see the 

Initiation Checklist at Attachment II. For 

a discussion on the comments received 

from interested parties, please see the 

Initiation Checklist at Attachment III. 

For a detailed discussion of the 

comments received by workers, please 

see the Initiation Checklist at 

Attachment II. Our analysis of the data 

indicates that the domestic producers of 

wooden bedroom furniture who support 

the Petition account for more than 57 

percent of the production (by U.S. dollar 

sales value) of the domestic like product 

produced by that portion of the industry 

expressing support for, or opposition to, 

the Petition. See Initiation Checklist at 

Attachment II.

Accordingly, the Department 

determines that the industry support 

requirements of section 732(c)(4)(A) of 

the Act have been met.

Export Price and Normal Value

The following is a description of the 

allegation of sales at less than fair value 

(‘‘LTFV’’) upon which the Department 

based its decision to initiate this 

investigation. The sources of data for the 

deductions and adjustments relating to 

the U.S. price and the factors of 

production are also discussed in the 

Initiation Checklist. Should the need 

arise to use any of this information as 

facts available under section 776 of the 

Act in our preliminary or final 

determination, we may reexamine the 

information and revise the margin 

calculations, if appropriate.

Export Price

The Petitioners identified 

approximately one-hundred thirty five 

Chinese companies as major producers 

and exporters of wooden bedroom 

furniture in China. See Petition at 

Exhibit 6.

The Petitioners calculated an export 

price (‘‘EP’’). To calculate export prices 

for wooden bedroom furniture from 

China, Petitioners used invoices for 

wooden bedroom furniture produced by 

Chinese producers that were purchased 

during the period of investigation 

(‘‘POI’’). Given the sales terms on the 

invoice, the Petitioners have used free 

on board (‘‘FOB’’) prices as the basis for 

the U.S. price and, conservatively, have 

not deducted foreign inland freight from 

the factory to the port, brokerage and 

handling fees, or port charges at the port 

of exportation. However, to obtain exfactory prices, the Petitioners deducted 

a percentage of the selling price (price 

listed on the invoice) to account for an 

agent markup for sales made from the 

agent to the U.S. customer in the United 

States. See Initiation Checklist for 

further information.

Normal Value

China is a non-market economy 

country and no determination to the 

contrary has yet been made by the 

Department. See Initiation Checklist at 

4–5. Accordingly, the Petitioners 

provided a dumping margin calculation 

using the Department’s NME 

methodology as required by 19 C.F.R. 

§351.202(b)(7)(i)(C) of the Department’s 

regulations.

For the normal value (‘‘NV’’) 

calculation, the Petitioners based the 

factors of production, as defined by 

section 773(c)(3) of the Act (raw 

materials, labor and energy), for wooden 

bedroom furniture using the factors of 

production used to make the wooden 

bedroom furniture on the invoices used 

in their calculation of export price 

above. In order to accurately calculate 

the usage of materials used in the 

production of the imported furniture, 

the Petitioners disassembled each piece 

of furniture and identified, weighed, 

and measured each component part. 

The items selected by the Petitioners for 

deconstruction and ultimately used for 

the normal value calculation, provide a 

broad selection of items within the 

wooden bedroom furniture like product 

category. According to the Petitioners, 

the dumping margins in the Petition 

represent ‘‘each of the products in a 

standard bedroom suite because subject 

imports are typically sold in suites, 

collections, or groups’’ and are 

‘‘representative of the prices for 

imports’’ of wooden bedroom furniture 

from China during the POI. See

Petitioners’ November 12, 2003 

Submission at 8. However, the amount 

of labor hours and energy needed to 

produce the wooden bedroom furniture 

items analyzed were based on the 

experience of the Petitioners. See 

Initiation Checklist.

Federal Register / Vol. 68, No. 242 / Wednesday, December 17, 2003 / Notices 70231

The Petitioners selected India as their 

surrogate country. The Petitioners 

argued that pursuant to section 773(c)(4) 

of the Act, India is an appropriate 

surrogate because it is a marketeconomy country that is at a comparable 

level of economic development to the 

NME and is a significant producer of 

comparable merchandise. Based on the 

information provided by the Petitioners, 

we believe that the Petitioners’ use of 

India as a surrogate country is 

appropriate for purposes of initiating 

this investigation. See Initiation 

Checklist.

In accordance with section 773(c)(4) 

of the Act, the Petitioners valued factors 

of production, where possible, on 

reasonably available, public surrogate 

country data. To value certain raw 

materials, the Petitioners used official 

Indian government import statistics, 

excluding those values from countries 

previously determined by the 

Department to be NME countries and 

imports into India from Indonesia, 

Korea and Thailand, in light of the 

prevalence of export subsidies in those 

countries. See Notice of Final 

Determination of Sales at Less Than 

Fair Value: Ferrovanadium from the 

People’s Republic of China 67 FR 71137, 

71139 (November 20, 2002). For inputs 

valued in Indian Rupees and not 

contemporaneous with the POI (i.e., 

April 2003-September 2003), the 

Petitioners used information from the 

wholesale price indices (‘‘WPI’’) in 

India as published in the International 

Financial Statistics of the International 

Monetary Fund to determine the 

appropriate adjustments for inflation. In 

addition, the Petitioners made currency 

conversions, where necessary, based on 

the average rupee/U.S. dollar exchange 

rate for the POI. See Petition at Exhibit 

11.

To value the raw materials, (lumber 

(e.g., ash, birch, maple, oak, pine, poplar 

tupelo), other wood items (e.g., cherry 

wood veneer, fiberboard, hardboard, 

okoume plywood, lauan plywood, 

particle board, poplar veneer, oak 

veneer, wood pulls and okoume veneer), 

fasteners (e.g., brad & nails, staples, 

dowels, screws, washers, brass hinges, 

nuts, brass bolts and hex key), paints 

and stains (non-water based stains, 

sealers and lacquers), other 

miscellaneous items (e.g., printed labels, 

printed tags, printed paper, glues, 

plastic furniture fittings, metal drawer 

pulls & parts, drawer guide brackets, felt 

and mirrors), packing materials (e.g., 

polyethylene foam, styrofoam, 

corrugated cardboard, tape, poly bags, 

poly straps, plywood, and shrink 

wrap)), the Petitioners calculated 

surrogate values from the Indian import 

statistics. See Petition at Exhibits 12 & 

13.

To value electricity, the Petitioners 

calculated surrogate values using prices 

paid by industrial electrical users in 

India from Key World Energy Statistics

published by the International Energy 

Agency in 2003. However, the price 

listed in Key World Energy Statistics is 

for electricity prices from 2000. 

Therefore, this price was adjusted for 

inflation using the WPI from the 

International Financial Statistics. See 

Petition at Exhibits 12 and 15.

Pursuant to 19 C.F.R. §351.408(c)(3) 

of the Department’s regulations, the 

Department calculates and publishes the 

surrogate values for labor to be used in 

non-market economy cases. Therefore, 

the Petitioners used the labor rate of 

$0.83 per hour listed on the 

Department’s website. See Petition at 

Exhibit 14.

The Petitioners calculated surrogate 

financial ratios (factory overhead, 

selling, general and administrative 

expenses (SG&A) and profit) using the 

publicly available financial statements 

from India Furniture Products, Ltd., an 

Indian producer of wooden bedroom 

furniture for the period (March 1, 2002-

March 31, 2003), the most recently 

available financial period.

Based on comparisons of EP to NV, 

calculated in accordance with section 

773(c) of the Act, the estimated 

recalculated dumping margin for 

wooden bedroom furniture ranges from 

158.74 percent to 440.96 percent.

Fair Value Comparisons

Based on the data provided by the 

Petitioners, there is reason to believe 

that imports of wooden bedroom 

furniture from China are being, or are 

likely to be, sold in the United States at 

less than fair value.

Allegations and Evidence of Material 

Injury and Causation

The Petition alleges that the U.S. 

industry producing the domestic like 

product is being materially injured and 

is threatened with material injury, by 

reason of the imports of the subject 

merchandise sold at less than NV. The 

Petitioners contend that the industry’s 

injured condition is evident in: (1) 

increasing imports’ market share and 

apparent domestic consumption; (2) 

declining employment; (3) declining 

production and capacity utilization; (4) 

plant closures; and (5) lost sales and 

revenues. See Initiation Checklist at 

Attachment V (Injury).

The Department assessed the 

allegations and supporting evidence 

regarding material injury and causation 

and determined that these allegations 

are supported by accurate and adequate 

evidence and meet the statutory 

requirements for initiation.

Initiation of Antidumping Investigation

Based upon our examination of the 

Petition on wooden bedroom furniture 

from China, we find that the Petition 

meets the requirements of section 732 of 

the Act. Therefore, we are initiating an 

antidumping duty investigation to 

determine whether imports of wooden 

bedroom furniture from China are being, 

or are likely to be, sold in the United 

States at less than fair value. Unless 

postponed, we will make our 

preliminary determination no later than 

140 days after the date of this initiation.

Distribution of Copies of the Petition

In accordance with section 

732(b)(3)(A) of the Act, a copy of the 

public version of the Petition has been 

provided to the government 

representatives of China.

International Trade Commission 

Notification

We have notified the ITC of our 

initiation, as required by section 732(d) 

of the Act.

Preliminary Determination by the ITC

The ITC will preliminarily determine, 

no later than mid-January, whether 

there is a reasonable indication that 

imports of wooden bedroom furniture 

from China are causing material injury, 

or threatening to cause material injury, 

to a U.S. industry. A negative ITC 

determination will result in this 

investigation being terminated; 

otherwise, this investigation will 

proceed according to statutory and 

regulatory time limits.

This notice is published pursuant to 

section 777(i) of the Act.

Dated: December 10, 2003.

James J. Jochum,

Assistant Secretary for Import 

Administration.

[FR Doc. 03–31129 Filed 12–16–03; 8:45 am]

BILLING CODE 3510–DS–S
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

B-1

APPENDIX B

CALENDAR OF PUBLIC CONFERENCE

Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

B-3

UNITED STATES INTERNATIONAL TRADE COMMISSION

WASHINGTON, DC

CALENDAR OF PUBLIC CONFERENCE

Those listed below appeared as witnesses at the United States International Trade Commission’s

conference held in connection with the following investigation:

WOODEN BEDROOM FURNITURE FROM CHINA

Investigation No. 731-TA-1058 (Preliminary)

November 21, 2003 - 9:30 a.m.

The conference was held in the Main Hearing Room of the United States International Trade

Commission Building, 500 E Street, SW, Washington, DC.

In Support of the Imposition of Antidumping Duties–

King & Spalding LLP / Washington, DC

on behalf of

• American Furniture Manufacturers Committee for Legal Trade and its individual members

• Cabinet Makers, Millmen, and Industrial Carpenters Local 721

• John Bassett, Chairman, Steering Committee of the American Furniture Manufacturers

Committee for Legal Trade and President & CEO of Vaughan-Bassett Furniture Company

• Steven Kincaid, President of the La-Z-Boy Casegoods Group and President of Kincaid 

Furniture Company

• Robert Spilman, Jr., President & CEO of Bassett Furniture Industries

• Wyatt Bassett, Executive Vice President of Vaughan-Bassett Furniture Company

• William Vaughan, President & CEO of Vaughan Furniture Company

• Irwin Allen, President & CEO of Michels-Pilliod Company

• Ken Loring, President and CEO, Boston Interiors

• Harold Brown, General Manager, Bassett Furniture Direct

• Harold Hewitt, President, Superior Furniture

• David Sowinski, Chief Strategy Implementation Officer, La-Z-Boy Inc.

Joseph W. Dorn )

Stephen A. Jones )–OF COUNSEL

Stephen J. Narkin )
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

B-4

CALENDAR OF PUBLIC CONFERENCE–Continued

In Opposition to the Imposition of Antidumping Duties–

Wilmer, Cutler & Pickering / Washington, DC

on behalf of

• Lacquer Craft Manufacturing Company, Ltd.

• Markor International Furniture (Tianjin) Manufacturing Co., Ltd.

• AICO Furniture

• Fine Furniture Design & Marketing

• Kemp Furniture

• Legacy Classic Furniture

• Magnussen Home

• Samuel Lawrence Furniture

• Schnadig Furniture

• Universal Furniture International

• William P. Kemp III, President, Kemp Enterprises, Inc.

John D. Greenwald )

Kristin Mowry )–OF COUNSEL

Charles Levy )

Hunton & Williams LLP / Washington, DC

on behalf of

• The Bombay Company

• City Furniture

• Crate and Barrel

• J.C. Penney Purchasing Corp. (a wholly-owned subsidiary of J.C. Penney Company, Inc.)

• Rhodes Furniture

• Rooms To Go Furniture Corp.

• Wickes Furniture

• Jeffrey Seaman, President & CEO, Rooms To Go Inc.

• James McAlister, Operations Manager, Quality and Sourcing, J.C. Penney Purchasing Corp. 

• John G. Reilly, Consultant, Nathan Associates Inc.

William Silverman ) –OF COUNSEL James R. Simoes )

Bryan Cave LLP / Washington, DC

on behalf of

• Furniture Brands International, Inc.

• Lynn Chipperfield, Senior Vice President and Chief Administrative Officer, Furniture Brands

International, Inc.

Jill A. Cramer ) –OF COUNSEL
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

C-1

APPENDIX C

SUMMARY DATA

Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

C-3

Table C-1

Wooden bedroom furniture: Summary data concerning the U.S. market, 2000-02, January-June 2002, and January-June 2003

Quantity=pieces; value=$1,000; unit labor costs are per piece; period changes=percent, except where noted

Item

Reported data Period changes

Calendar year January-June Calendar year

Jan.-

June

2000 2001 2002 2002 2003 2000-02 2000-01 2001-02 2002-03

U.S. consumption value:

Amount 4,181,776 4,053,123 4,388,654 2,172,583 2,246,442 4.9 -3.1 8.3 3.4

Producers’ share 1 59.8 54.9 47.3 51.5 42.7 -12.5 -4.9 -7.5 -8.9

Importers’ share:1

China 10.3 14.0 21.8 18.6 27.8 11.5 3.6 7.9 9.2

All other sources 29.9 31.2 30.8 29.8 29.5 1.0 1.3 -0.3 -0.3

Total imports 40.2 45.1 52.7 48.5 57.3 12.5 4.9 7.5 8.9

Value of U.S. imports:

China 432,675 565,551 957,948 404,700 624,601 121.4 30.7 69.4 54.3

All other sources 1,249,004 1,263,729 1,353,509 648,197 662,928 8.4 1.2 7.1 2.3

Total, imports 1,681,679 1,829,281 2,311,456 1,052,897 1,287,529 37.4 8.8 26.4 22.3

U.S. producers’:

Average capacity quantity 14,815,964 14,547,521 14,258,472 7,396,217 6,889,240 -3.8 -1.8 -2.0 -6.9

Production quantity 13,720,679 12,375,325 12,307,669 6,606,824 6,066,888 -10.3 -9.8 -0.5 -8.2

Capacity utilization1 (percent) 82.7 75.8 75.4 79.1 75.4 -7.4 -6.9 -0.5 -3.7

U.S. shipments value 2,500,097 2,223,842 2,077,198 1,119,686 958,913 -16.9 -11.1 -6.6 -14.4

Export shipments value 40,896 33,649 33,163 16,290 14,626 -18.9 -17.7 -1.4 -10.2

Ending inventory quantity 1,783,934 1,606,587 1,657,847 1,697,310 1,736,813 -7.1 -9.9 3.2 2.3

Inventories/production1 13.0 13.0 13.5 12.8 14.3 0.5 0.0 0.5 1.5

Production workers 38,687 34,859 31,990 33,069 29,555 -17.3 -9.9 -8.2 -10.6

Hours worked (1,000) 67,425 57,970 55,311 30,728 26,860 -18.0 -14.0 -4.6 -12.6

Wages paid ($1,000) 856,562 766,185 736,570 424,011 368,489 -14.0 -10.6 -3.9 -13.1

Hourly wages $11.19 $11.67 $12.08 $12.29 $12.40 7.9 4.3 3.5 0.9

Productivity (pieces/1,000 hours) 203 214 223 215 227 9.5 5.1 4.2 5.5

Unit labor costs per piece $55.09 $54.67 $54.25 $57.12 $54.69 -1.5 -0.8 -0.8 -4.3

Net sales:

Quantity 14,285,111 13,469,375 12,800,568 6,969,138 6,313,737 -10.4 -5.7 -5.0 -9.4

Value 2,629,870 2,354,403 2,163,578 1,182,222 1,003,183 -17.7 -10.5 -8.1 -15.1

Cost of goods sold (COGS) 2,026,587 1,832,289 1,698,451 909,371 799,406 -16.2 -9.6 -7.3 -12.1

Gross profit or (loss) 603,283 522,114 465,127 272,851 203,777 -22.9 -13.5 -10.9 -25.3

SG&A expenses 331,982 324,653 297,027 154,397 139,041 -10.5 -2.2 -8.5 -9.9

Operating income or (loss) 271,301 197,461 168,100 118,454 64,736 -38.0 -27.2 -14.9 -45.3

Capital expenditures 72,374 55,872 35,909 16,875 13,955 -50.4 -22.8 -35.7 -17.3

COGS/sales1 77.1 77.8 78.5 76.9 79.7 1.4 0.8 0.7 2.8

Operating income or (loss)/sales1 10.3 8.4 7.8 10.0 6.5 -2.5 -1.9 -0.6 -3.6

1 Reported data are in percent and period changes are in percentage points.

Note.–Financial data are reported on a fiscal-year basis and may not necessarily be comparable to data reported on a calendar-year basis. Because of

rounding, figures may not add to the totals shown. Shares are calculated from the unrounded figures. Quantity of imports is not available in official trade

statistics for all HTS numbers, so only value is reported here for imports. 

Source: Compiled from data submitted in response to Commission questionnaires and Commerce data.

Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

D-1

APPENDIX D

THE RELATIONSHIPS AMONG NOMINAL EXCHANGE RATES,

 REAL EXCHANGE RATES, AND PRODUCER PRICE TRENDS, AND

 THE IMPACT OF CHANGES IN THEIR VALUES

 ON PRICES OF EXPORTS AND IMPORTS

Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 1 Depreciation of a currency also indicates that more of that currency is required to buy one U.S. dollar.

 2

 Appreciation of a currency also indicates that less of that currency is required to buy one U.S. dollar.

 3

 Currency depreciation/appreciation can affect prices of exports and imports, or allow/force the importer or

exporter to earn a higher/lower profit with the price level unchanged. Alternatively, some combination of changes in

both prices and profits can occur. 

 4

 The real exchange rate is a better indicator (than the nominal exchange rate) of the impact of exchange rates on

export and import prices.

 5

 When looking at the impact of relative inflation rates on the nominal exchange rate over time, however,

relatively more inflation in the subject country will tend over time to depreciate its nominal currency value as foreign

demand shifts away from its products toward lower-priced products from other countries. The shift in demand away

from the subject country’s products will reduce demand for its currency and, thereby, put downward pressure on the

exchange rate (price of the currency).

D-3

An exchange rate is the price of one currency in terms of another currency. Hence, an exchangerate index is a price index. The exchange rate indices discussed in this report were based on exchange

rates expressed in U.S. dollars per unit of the foreign currency (i.e., price of the foreign currency). An

exchange-rate index number below 100 indicates that the foreign currency has depreciated (become

cheaper) vis-a-vis the U.S. dollar; e.g., it requires fewer U.S. dollars to buy one unit of the foreign

currency compared to the number of U.S. dollars required during the base period,1

 which has an index

number of 100. On the other hand, an exchange-rate index number above 100 indicates that the foreign

currency has appreciated (become more expensive) vis-a-vis the U.S. dollar; e.g., it requires more U.S.

dollars to buy one unit of the foreign currency.2

 For instance, depreciation of the Chinese yuan tends to

make Chinese exports less expensive in U.S. dollars and Chinese imports more expensive in yuan. On

the other hand, appreciation of the Chinese yuan tends to make Chinese exports more expensive in U.S.

dollars and Chinese imports less expensive in yuan.

3

The producer or wholesale price indices measure inflation or deflation at the producer selling

price level in each subject country and in the United States. Adjusting nominal exchange rates by relative

inflation or deflation in the subject country vis-a-vis the United States yields a real exchange rate, which

accounts for relative changes in prices in the subject country as well as changes in nominal exchange

rates.4

 As a result, the nominal exchange rate in each period has a counterpart real exchange rate for that

period. Indices of the two counterpart exchange rates may actually show opposing changes in the value

of the currency, with one index representing the nominal value of the currency and the other the real

value of the currency. For instance, the nominal exchange rate index may indicate that depreciation of the

currency in nominal terms had occurred in a particular period but, because of sometimes large differences

in inflation/deflation between countries, the counterpart real exchange rate index may actually indicate

that appreciation of the currency in real terms had occurred in that period. In such an instance, changes in

the nominal exchange rate would show an opposite (and incorrect) impact on export and import prices

than that indicated by changes in the real exchange rate.

In considering real exchange rates it is important to understand the relationship between relative

price changes and nominal exchange rates at a given point in time. Relatively more inflation in the

subject country vis-a-vis the United States will undercut nominal depreciation of the subject country’s

currency vis-a-vis the United States, but will reinforce nominal appreciation of the subject country’s 

currency.5

 Relatively less inflation, on the other hand, will reinforce nominal depreciation of the subject
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

 6 When looking at the impact of relative inflation rates on the nominal exchange rate over time, however,

relatively less inflation in the subject country will tend over time to appreciate its nominal currency value as foreign

demand increases for its products and away from higher-priced products from other countries. The shift in demand

toward the subject country’s products will increase demand for its currency and, thereby, put upward pressure on the

exchange rate (price of the currency).

D-4

country’s currency and undercut nominal appreciation of the subject country’s exchange rate.6 As an

example, the first of these relationships is seen with the Chinese yuan in this investigation. During

January 2000-June 2003, the Chinese yuan depreciated on a quarterly basis by 27.5 percent in nominal

terms against the U.S. dollar, but higher inflation in Chinese compared to that in the United States during

this period (32.3 percent inflation versus 2.7 percent inflation) led the Chinese yuan to depreciate by only

16.6 percent in real terms against the U.S. dollar. (While nominal depreciation of the yuan tended to

make Chinese exports less expensive in U.S. dollars, the inflation in China compared to that in the United

States tended to raise the dollar-converted prices of its exports. The net effect, as indicated by the real

exchange rate, would be pressure to decrease the dollar prices of Chinese exports somewhat less than the

decrease suggested by the nominal depreciation of the yuan.)
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

E-1

APPENDIX E

U.S. RETAILERS’ IMPORT PRICE DATA FOR THEIR

IMPORTED WOODEN BEDROOM FURNITURE FROM CHINA

Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

E-3

Tables E-1 and E-2 show quarterly import price data of U.S. furniture retailers for the Chinese

wooden bedroom furniture imported by these retailers for sale in their retail stores. The prices are based

on their reported c.i.f., duty-paid, landed (U.S. ports of entry) values. These quarterly import price data

are also shown in figures E-1 and E-2 along with quarterly selling price data of the imported Chinese

wooden bedroom furniture reported by importers selling at the wholesale level of the market to U.S.

furniture retailers; the import price data and the selling price data were reported by two different groups

of firms. The import price data reportedly do not represent retailers’ full costs of purchasing the Chinese

wooden bedroom furniture, whereas the selling price data, which were shown and discussed in Part V

(tables V-4 and V-5), represent the importers’ full cost plus their markup at the wholesale level of the

market. The c.i.f., duty-paid import price data and the import wholesale selling price data are presented in

appendix E for comparison purposes. The reported c.i.f., duty-paid import prices are not always less than

the reported import wholesale selling prices, which is likely due to differences in the physical products

and volumes reported; total quarterly volumes reported by the importing retailers are typically less than

those of importers reporting selling price data.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

E-4

Table E-1

Wooden bedroom furniture: U.S. weighted-average net c.i.f., duty-paid, landed (U.S. ports of entry) import prices and quantities of Chinese products 1A-1D

(Louis Philippe style wooden bedroom furniture pieces) and constructed 4-piece suite prices, imported by retailers, by quarters, January 2000-June 2003 

Period

Product 1A--Bed Product 1B-Dresser Product 1C-Mirror Product 1D-Nightstand

4-piece

suite

Price

(per

piece)

Quantity

(no. of

pieces)

No.

of

firms

Price

(per

piece)

Quantity

(no. of

pieces)

No.

of

firms

Price

(per

piece)

Quantity

(no. of

pieces)

No.

of

firms

Price

(per

piece)

Quantity

(no. of

pieces)

No.

of

firms

Price

(per

suite)

2000:

 Jan.-Mar. - - - - - - - - - - - - -

 Apr.-June - - - - - - - - - - - - -

 July-Sept. - - - - - - - - - - - - -

 Oct.-Dec. *** *** 1 - - - - - - - - - -

2001:

 Jan.-Mar. *** *** 2 *** *** 1 *** *** 1 *** *** 1 $773.61

 Apr.-June *** *** 2 *** *** 2 *** *** 2 *** *** 2 668.75

 July-Sept. *** *** 2 *** *** 2 *** *** 2 *** *** 2 614.10

 Oct.-Dec. $203.67 1,094 4 $221.31 1,099 4 $45.48 1,044 4 $101.41 1,966 4 571.87

2002:

 Jan.-Mar. 196.08 1,783 4 213.19 1,716 4 44.33 1,584 4 99.43 2,675 4 553.03

 Apr.-June 202.27 2,170 5 204.41 2,268 5 43.10 2,138 5 100.78 2,746 5 550.56

 July-Sept. 195.96 3,078 7 208.15 3,152 7 43.55 2,956 7 96.97 4,696 7 544.63

 Oct.-Dec. 223.20 3,306 9 189.14 4,974 9 73.45 6,199 9 93.53 4,587 8 579.32

2003:

 Jan.-Mar. 206.82 5,299 10 200.24 6,651 9 68.66 6,199 9 94.28 8,758 8 570.00

 Apr.-June 215.83 6,248 8 197.98 6,453 9 81.18 7,208 9 95.55 7,697 8 590.54

TOTALS 22,978 11 26,313 9 27,328 9 33,125 8

Source: Compiled from data submitted in response to Commission questionnaires.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

E-5

Table E-2

Wooden bedroom furniture: U.S. weighted-average net c.i.f., duty-paid, landed (U.S. ports of entry) import prices and quantities of Chinese products 2A-2D

(Mission style wooden furniture bedroom pieces) and constructed 4-piece suite prices, imported by retailers, by quarters, January 2000-June 2003 

Period

Product 2A--Bed Product 2B-Dresser Product 2C-Mirror Product 2D-Nightstand

4-piece

suite

Price 

(per

piece)

Quantity

(no. of

pieces)

No.

of

firms

Price

(per

piece)

Quantity

(no. of

pieces)

No.

of

firms

Price

(per

piece)

Quantity

(no. of

pieces)

No.

of

firms

Price

(per

piece)

Quantity

(no. of

pieces)

No.

of

firms

Price 

(per

suite)

2000:

 Jan.-Mar. *** *** 2 *** *** 2 *** *** 2 *** *** 2 $609.42

 Apr.-June *** *** 2 *** *** 2 *** *** 1 *** *** 2 608.56

 July-Sept. *** *** 2 *** *** 1 *** *** 2 *** *** 2 608.26

 Oct.-Dec. *** *** 2 *** *** 2 *** *** 2 *** *** 2 610.09

2001:

 Jan.-Mar. *** *** 3 *** *** 3 *** *** 3 *** *** 3 628.45

 Apr.-June *** *** 3 *** *** 3 *** *** 3 *** *** 3 629.79

 July-Sept. *** *** 3 *** *** 3 *** *** 3 *** *** 2 626.05

 Oct.-Dec. $212.73 774 4 *** *** 3 *** *** 3 *** *** 3 613.98

2002:

 Jan.-Mar. 213.41 2,445 5 $270.50 1,100 4 $53.03 1,089 4 $81.84 1,592 4 618.78

 Apr.-June 221.06 1,513 5 267.20 1,288 4 *** *** 3 82.14 1,936 4 570.40

 July-Sept. 230.80 1,779 5 268.49 1,678 4 *** *** 3 81.69 2,522 4 580.98

 Oct.-Dec. 231.39 1,382 5 267.28 948 4 46.23 2,198 5 81.51 1,576 4 626.41

2003:

 Jan.-Mar. 243.63 2,401 5 269.34 1,793 5 49.38 2,177 6 84.21 2,652 5 646.56

 Apr.-June 230.96 1,293 6 258.33 1,164 4 54.66 906 3 86.93 1,849 5 630.88

TOTALS 11,587 7 7,971 5 6,370 6 12,127 5

Source: Compiled from data submitted in response to Commission questionnaires.
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

E-6

Figure E-1

Wooden bedroom furniture: U.S. weighted-average net c.i.f., duty-paid, landed (U.S. ports of entry) import

prices and quantities and wholesale selling prices and quantities of imported Chinese products 1A-1D

(Louis Philippe style wooden bedroom furniture pieces) imported by U.S. retailers and by firms selling at

wholesale, respectively, by quarters, January 2000-June 2003

*******

Figure E-2

Wooden bedroom furniture: U.S. weighted-average net c.i.f., duty-paid, landed (U.S. ports of entry) import

prices and quantities and wholesale selling prices and quantities of imported Chinese products 2A-2D

(Mission style wooden bedroom furniture pieces) imported by U.S. retailers and by firms selling at

wholesale, respectively, by quarters, January 2000-June 2003

*******
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

F-1

APPENDIX F

ALLEGED EFFECTS OF IMPORTS ON U.S. PRODUCERS’

EXISTING DEVELOPMENT AND PRODUCTION EFFORTS,

GROWTH, INVESTMENT, AND ABILITY TO RAISE CAPITAL

Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

F-3

The number of U.S. producers answering the following question is shown in the tabulation

below:

Since January 1, 2000, has your firm experienced any actual negative effects on its

return on investment or its growth, investment, ability to raise capital, existing

development and production efforts (including efforts to develop a derivative or

more advanced version of the product), or the scale of capital investments as a result

of imports of wooden bedroom furniture from China (Question III-9)?

Item Number of firms

No 7

1-Cancellation, postponement, or rejection of expansion projects 17

2–Denial or rejection of investment proposal 7

3–Reduction in the size of capital investments 23

4–Rejection of bank loans 4

5–Lowering of credit rating 7

6–Problem related to the issue of stocks or bonds 2

Source: Compiled from company questionnaire responses.

Other comments to this question are as follows:

*******

Longer comments are summarized below:

*******
Inv. No. 731-TA-1058 (P) Wooden Bedroom Furniture

F-4

The number of U.S. producers answering the following question is shown in the tabulation and

their comments are also presented below:

Does your firm anticipate any negative impact of imports of wooden bedroom

furniture from China (Question III-10)?

Item Number of firms

No 5

Yes (see below for their comments) 33

Source: Compiled from company questionnaire responses.

Comments to this question are as follows:

*******

Longer comments are summarized below:

*******