Organization Name:

Note: Representatives submitting on behalf of an organization must enter information below.

Requestor Representative:

Section 301 Investigation: China's Acts, Policies, and Practices Related to Technology 

Transfer, Intellectual Property, and Innovation - Form to Request Exclusion of Product

When submitting a product exclusion request using this form, enter the specified 

information in the following fields and explain the basis and rationale for your statements. 

By completing this form, you certify that the information provided is complete and 

correct to the best of your knowledge. 

1. Indicate whether the comment contains business confidential information (BCI), is a public

document, or is a public version of a BCI document.

3.

2. Please provide a complete and detailed description of the product of concern:

4.

5. Requestor's relationship to the product:

CONTINUED BELOW

*

10-digit HTSUS item number* for product you wish to address in this product exclusion request:

Use numerical characters only with no special characters (example: 1023456789). For help in finding 

the HTSUS item number associated with your product, see https://hts.usitc.gov/

1

7.

6. Does this submission in regulations.gov include additional attachments?

Please indicate whether any additional attachment contains business confidential

information (BCI), is a public document, or is a public version of a BCI document.

VERSION 1

Requestor Information

Requestor Name (Last, First):
END 2

8. Is this product, or a comparable product, available from sources in the United States?:

VERSION 1

11. Please provide information in support your request, taking account of the instructions

provided in Section B of the Federal Register notice (note: text entered below can extend

beyond the apparent size of this box).

9. Is this product, or a comparable product, available from sources in third countries?:

10. Please provide the value and quantity (with units) of the Chinese-origin product of concern

that you purchased for each calendar year specified. Limit this figure to the products

purchased by your firm (or by members of your trade association) alone. Please provide 

estimates if precise figures are unavailable.

2016 Value:

2015 Value:

2017 Value:

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2015 Quantity:

2017 Quantity:
Attachment 1 to 8479909496 SA Recycling – Grates

Page 1

Attachment 1 to 8479909496 SA Recycling - Grates

SA Recycling is a full-service ferrous and non-ferrous metal recycler and processor. Recognized as an industry 

leader in metal recycling, SA Recycling operates over 70 recycling facilities conveniently located throughout 

California, Texas, Arizona, Nevada, Georgia, Alabama and Tennessee. Properly handled, scrap metal is a 

continuous and valuable resource that can be re-melted and reshaped into new products countless times while 

providing significant economic and environmental benefits as compared to virgin materials. SA Recycling

collects, processes and recycles metals ranging from iron and steel to aluminum, copper, lead, stainless steel 

and zinc, which it then provides to mills and foundries for use in the production of new steel and other metal 

products.

One of the principal sources of supply for the scrap metal SA Recycling processes at its U.S. facilities is end-oflife vehicles. The processing of vehicles within an SA Recycling facility relies on several distinct processes, 

including shredding. Shredding is the only true means of recycling the metal contained within a vehicle (as 

well as other large items), and is accomplished through the use of auto shredders, with the grates the subject 

of this exclusion request representing one of the wear parts essential to the breaking down of each vehicle to 

prepare the metal for repurposing into new steel and other metal products. Without the benefits that 

shredding provides, much of the metal that finds a second life through the recycling process would end up in a 

landfill, to the detriment of not only the mills and foundries that rely on that metal for their own 

manufacturing requirements but also the environment as a whole.

An image of that part is provided below:

Shredder wear parts are generally made of three types of material that have an effect on cost. The majority of 

these replacement components are made of manganese steel that absorbs impact and is resistant to abrasion, 

and thus can process metal scrap up to three times the hardness of the parts. The second type is made of alloy 

steel that can be used to make grates, as well as hammers, liners, breaker bars and anvils (other parts for 

which we are requesting exclusions). Alloy steel hammers, for example, as the main part used to shred autos, 

are used to process lighter gauge scrap. These hammers cost more than hammers made of manganese steel. 

The hardness of the alloy hammers makes them brittle and sustainable to premature failure when exposed to 

excessive hard metals, as occurs when shredding metal. As alloy hammers are not economical to use in 
Attachment 1 to 8479909496 SA Recycling – Grates

Page 2

shredders, the same applies to all other wear part components of the shredder, including grates. The third 

type, differentially heat-treated alloy – or DHT – is a material also used for grates. DHT grates are nearly twice 

as hard as traditional manganese alloy grates, requiring a four-step heat-treating process (as compared to a 

single-step heat-treating process for traditional manganese alloy grates). The process creates a significantly 

harder wear component with a better wear life span but also a much higher cost than both manganese and 

alloy parts. 

Manganese parts are one-third to one-half the price of the alternatives and, therefore, are a preferred option 

where wear part production is concerned. With more than 90% of the manganese steel parts used in the 

United States manufactured in China, turning to Chinese producers of these components is the only reliable 

option available in today's marketplace. This is not to say that auto shredders and parts suppliers have not 

tried to find additional suppliers to diversify the purchasing of these parts. There is one foundry in the United 

States, but the operation is too small to meet the requirements of all shredders operating in the United States.

As of October 2018, their lead time to deliver required parts is 50 weeks, whereas typical times from China are 

18-24 weeks. Germany is a source of the higher priced DHT hammers and has a small niche customer base in 

the United States. Foundries in Canada and Peru can meet quality standards, but are smaller operations that 

provide significantly higher-priced products and do not have the production capacity to satisfy continuous U.S. 

demand. Foundries in India, Middle East, Mexico, Malaysia and Australia have been approached, but similar 

capacity constraints, as well as higher prices, quality issues or a combination of these limitations has prevented 

U.S. companies from establishing long-term arrangements to purchase their products. Finally, even were a 

viable alternative identified, transitioning from existing suppliers to a new supplier situated outside of China 

cannot be accomplished lightly, as it requires a significant investment in design, development and testing 

before final approval for the on-going production and supply of wear parts may be achieved. In the end, 

therefore, auto shredders in the United States must source about 81-85% of their parts from China in order to 

remain competitive and satisfy customer needs. 

Given the repetitive need for these wear parts, the 25% tariff imposed under Section 301 has already had a 

significant adverse financial impact on SA Recycling. Auto shredders are operating in an extremely costconscious environment, and are already combatting increases in transportation, energy, fuel and labor costs. 

The addition of these tariffs to that cost structure promises to inhibit if not preclude SA Recycling’s on-going 

ability to supply its steel mill and foundry customers, while also resulting in increased cost to those customers 

who are, themselves, seeking to recover their own production footprint in the United States. In either 

instance, an industry which the Administration has strongly targeted and supported as a key partner in the 

resurgence of U.S. industry will be harmed. Taken in totality, we respectfully request that this exclusion 

request be granted so that the auto shredder industry may remain cost-competitive and the on-going supply of 

recycled steel and other metal products to U.S. mills and foundries preserved.

While we respectfully submit that these reasons alone are sufficient to grant SA Recycling's request for a 

product exclusion, as a mid-sized business heavily invested in the United States, the continued imposition of 

this tariff on SA Recycling's auto shredder wear part imports will not eliminate the harmful and unfair practices 

associated with China that were identified by USTR in its Section 301 Report. The production of these wear 

parts does not fall within any of the 10 categories identified by China as part of its Made in China 2025

industrial plan and will not, therefore, further those ambitions in any substantive way. Nor, for that matter, is 

the production of the wear part the result of any of the unfair trade practices identified by USTR in its report 

on China's "Acts, Policies, and Practices Related to Technology Transfer, Intellectual Property, and Innovation." 

Although the technology used to shred is proprietary based on SA Recycling's internally-developed intellectual 

property, the production of these items is not in and of itself controlled. Given these facts, the continued 
Attachment 1 to 8479909496 SA Recycling – Grates

Page 3

imposition of additional duties at the 25% level on SA Recycling's wear parts imports will not have any practical 

impact on the elimination of China's unfair trade practices.

I hereby certify that the information provided is complete and correct to the best of my knowledge. The 

bracketed information set forth in this submission is business confidential to SA Recycling LLC, and the 

disclosure to any third party would compromise SA Recycling's competitive position, which would adversely 

affect the Company's financial and operational performance. The bracketed information is neither subject to 

public disclosure nor disclosed to the public; it remains confidential at all times to the internal management 

and business operations of SA Recycling LLC.