**SYNTRON MATERIAL HANDLING**

**Monday, October 8, 2018**

**Ambassador Robert Lighthizer**

**U.S. trade Representative**

**Office of the United States Trade Representative**

**600 17th Street NW**

**Washington, DC  20006**

**Re:  USTR-2018-0025 - Procedures to Consider Requests for Exclusion of Particular Products from the Determination of Action Pursuant to Section 301:**

**SYNTRON Drive assembly item number: 159316-D.BUY**

**BF-2-B DRIVE ASSEMBLY 115/60**

**Physical dimensions: width: 8 inches; length: 12 5/8 inches, height: 8 1/16 inches**

**weight: 67 pounds made from SAEJ431b gray cast iron and is painted.**

**Vibratory movement of the drive assembly is used in manufacturing to actuate dry materials or small parts.**

**(HTS# 8474.90.0010)**

**Dear Ambassador Lighthizer:**

  Syntron Material Handling (SMH) provides material handling solutions for conveying, feeding, elevating, vibratory flow aids and mining controls of bulk product. As a leader of innovative material handling solutions, we offer efficient and cost-effective solutions to improve and enhance the technology manufacturing business customers are already using. Industries we serve include food handling, ports and terminals, aggregates, cement, glass mining, pulp and paper, power generation and trona-potash-salt. Our products include vibrating conveyors, belt conveyor idlers, screw conveyors, bucket elevators, underground mining, heavy duty and light industry feeders.

SMH is located in Saltillo, Northeast Mississippi. Saltillo has an estimated population of 5000. Our 300,000 square foot facility was built in 1974 and it houses Syntron Material Handling and our Corporate Office. SMH currently employs 229 full-time team members.

Additionally, there is a Syntron Material Handling Solutions facility in Changshu, China. This location was established in 2006 and employs 23 team members.

**Mission Statement**

Syntron material Handling is a customer focused industry leader with a reputation for providing innovative engineering, high-performance products, and superior customer service.

**Annual Quantity & Value**

2017 Value:	**[BCI]**			2017 Quantity:  **[BCI]**

2016 Value:	**[BCI]**		2016 Quantity:  **[BCI]**

2015 Value:	**[BCI]**		2015 Quantity:  **[BCI]**

**RATIONALE FOR REQUESTED EXCLUSION**

**11. Is the Chinese-origin product of concern sold as a final product or an input used in**

**a) For imports sold as final products, please provide:**

**[BCI]**of your total gross sales in 2017 that the Chinese-origin product accounted for.

**b) For imports of inputs used in the production of final products,**

**please provide:**

**[BCI]**of the total cost of producing the final product(s) the Chinese-origin input accounts for.

**[BCI]**of your total gross sales in 2017 that sales of the final product(s) incorporating the input accounted for.

**Economic Impact**

**SMH understands that the purpose of the Section 301 tariffs is to eliminate unfair Chinese trade practices relating to the misappropriation of United States intellectual property and technology.  The imposition of these tariffs is intended to be practicable and effective to obtain the elimination of acts, policies, and practices viewed as detrimental.  Imposing tariffs on these products would negatively affect this company as well as SMH customers.**

**SMH currently employs 229 team members in our Saltillo, MS, location. SMH employees represent approximately 9% of Saltillo, Mississippi workforce. Additional costs in tariffs will lead to reduced competitiveness and a reduction in demand, ultimately resulting in loss of employment and marginal profitability.**

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**Made in China 2025**

**Placing tariffs on these drive assemblies would not benefit U.S. industry, nor would it further the USTR’s stated goals underlying the Section 301 investigation.   According to the USTR’s Section 301 Investigation findings, China’s “Made in China 2025” industrial policy is centered on promoting ten strategic sectors of high-technology industries.**

**These drive assemblies are not among those categories.**

**The Chinese government has not employed any tactics to intervene in or regulate SMH’s operations in China.  It has not attempted to use discretionary administrative licensing and approval processes, foreign equity limitations, or foreign ownership restrictions to require or pressure SMH to transfer technology.  SMH’s control over its intellectual property and technology in China has not been undermined, and the Chinese government has not directed or facilitated investment in or acquisition of SMH’s assets or intellectual property.  SMH is similarly unaware of any data breaches or attacks on any SMH facilities in China.**

**The Chinese government does not consider SMH’s drive assemblies, to be an area of strategic concern for its industrial policies.**

**Imposing additional tariffs on such would only harm American interests and would not have a material effect on China’s acts, policies and practices used to acquire foreign technology or that the USTR has found to be unreasonable or discriminatory.**

**Other Relevant Information**

**This drive assembly is an integral part of the end user’s conveyor system. It is imported with additional processing from SMH before shipping to the end user.**

**SMH sourced from China due to cost competitiveness.**

**Impact to Company Workforce**

**Should we have to raise costs of products to recoup this additional tariff expense, which we have begun to do, and that could reduce our competitiveness in the market and ultimately impact retention of our current workforce of 229 people in Saltillo, MS.**

**SMH is unaware of any potential issues that would affect the ability of US CBP to administer subject exclusion.  CBP should be able to easily identify the products based on HTSUS code and standard information provided.**

**As such, we respectfully request exclusion from Section 301 for our product, 159316-D-BUY,  classified under HTS# 8474.90.0010, that is produced and sourced from China.**

**Any Additional Supporting Information**

**PRODUCT PHOTO ATTACHED**

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**PRODUCT TECHNICAL DATA ATTACHED**

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847490010 SMH 159316-D-BUY Exclusion letter P.docx

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