East China's largest seller is caught in anti-dumping storm!

With the continuous advancement of economic globalization and the cross-border e-commerce boom triggered by the epidemic in recent years, more and more Chinese brands are heading to overseas markets, and the trend of brand going overseas is prevalent.

However, where there is a market, there will be conflicts of interest. When a foreign company gradually occupies more market share and poses a certain threat to the interests of local companies, non-business competition will emerge.

For Chinese companies entering the US market, the two most likely means of abnormal competition are Section 337 investigation and anti-dumping. In previous articles, I wrote about Tineco , a brand under Ecovacs, which was investigated under Section 337 because it affected the interests of its competitor Bissell . Today, let's take a look at another case.

Daye shares, a big seller of East China garden equipment, is under anti-dumping and anti-subsidy investigation

On April 19, 2021, in response to an application submitted by the American company MTD Products, Inc. on March 30, 2021, the U.S. Department of Commerce ( DOC ) announced the initiation of anti-dumping and countervailing duty investigations on walk-behind gasoline snow blowers imported from China. Recently, the DOC made a final ruling on the anti-dumping and countervailing duty investigations in this case. Among them:

( 1) It is ruled that the dumping duty rate for Ningbo Daye Garden Equipment Co., Ltd. (hereinafter referred to as the “Company”) is 223.07% nationwide and the adjusted dumping duty rate is 201.99%; the dumping duty rate for other enterprises that have been granted individual tax rates is 163.27% and the adjusted dumping duty rate is 142.19%.

( 2) The subsidy tax rate for the company is 203.06%, and the subsidy tax rate for other Chinese companies is 203.06%.

The United States International Trade Commission ( US ITC) is expected to make a final ruling on anti-dumping and countervailing duty for the above-mentioned products on May 5, 2022. The dumping and subsidy rates currently calculated by the DOC will only take effect after the ITC's final ruling on industry damage is published in the Federal Register ("FR").

It is reported that from 2021 to the date of disclosure of this announcement, Daye Co., Ltd. has not exported walk-behind gasoline snowplows to the United States, and Daye Co., Ltd. has completed the preliminary deployment of overseas warehouses and overseas production bases overseas. Daye Co., Ltd. stated that the anti-dumping and anti-subsidy investigation of walk-behind gasoline snowplows in the United States has no significant impact on the company.

Despite more than one investigation, the big seller actively responded

In fact, this is not the first time that Daye shares have been subjected to malicious competition from American companies. As early as May 2020, the same American company MTD Products, Inc. also submitted the same investigation application to the US Department of Commerce.

At that time, the U.S. Department of Commerce made the following final ruling on walk-behind lawn mowers imported from China and Vietnam:

It was ruled that the dumping rate of Ningbo Daye Garden Equipment Co., Ltd. (hereinafter referred to as the "Company") was 98.73% and the adjusted dumping rate was 88.14%; the dumping rate of enterprises that obtained separate tariff rates was 98.73% and the adjusted dumping rate was 88.17%; the dumping rate of other Chinese producers/exporters was 274.29% and the adjusted dumping rate was 263.75%; the dumping rate of Vietnamese producers/exporters was 148.35%~176.37%.

The ruling was that Daye Co., Ltd. 's subsidy rate was 14.17%, the mandatory respondent Zhejiang Aimi Ruisen Technology Co., Ltd.'s subsidy rate was 20.98%, and the subsidy rates for other Chinese manufacturers/exporters were all 16.29%.

For Daye Co., Ltd., the sales revenue of gasoline lawn mowers exported to the United States in 2020 was 326 million yuan, accounting for 32.59% of the total operating revenue in 2020 at that time.

After being investigated, Daye shares said that it would actively respond to the lawsuit and strive to obtain the lowest anti-dumping and anti-subsidy tax rates in the domestic industry. Since then, Daye shares have been building overseas production bases and setting up overseas warehouses in the United States to minimize the impact of gasoline lawn mower exports on American companies.

Perhaps it is because of previous experience that the recent anti-dumping investigation has not had a significant impact on Daye Co., Ltd.

Daye Group - Global Leader in Gardening Equipment

Daye Co., Ltd. is a leading enterprise in the domestic garden machinery industry. Since its establishment, it has been focusing on the research and development, production and sales of agricultural, forestry and horticultural irrigation and spraying tools. It has been rated as a high-tech enterprise since 2009, and has the "Zhejiang Provincial Enterprise Technology Center" and "Provincial Industrial Design Center". It has 124 patents, including 66 invention patents.

It is reported that Daye Co., Ltd.'s production model is mainly ODM, and its products are sold to more than 50 countries and regions around the world through foreign department stores and various brand distributors. It has been widely recognized in the international market. Its main customers include Walmart, Home Depot, Husqvarna Group, etc.

In the third quarter of 2021, Daye's operating income was 281 million yuan, an increase of 187.41% compared with the same period last year. The huge increase in Daye's revenue is inseparable from the rapid development of the garden equipment market under the influence of the epidemic.

The market prospects for garden equipment are promising, with an average annual compound growth rate of 7%

According to Global Market Insights, the lawn and garden equipment market size exceeded USD 32,415.2 million in 2020 and is expected to grow at a CAGR of 7.1% from 2021 to 2027.

The garden equipment market, which includes a range of tools designed for gardening activities, is seeing new growth possibilities with strong demand for landscaping work in the commercial and residential construction industries, as well as technological advances in gardening and landscaping tools.

According to the report of Global Market Insights, the garden equipment market will have the following major development trends in the future:

Gas powered products are most popular

Gas-powered equipment generated more than $15 billion in revenue for the garden equipment market in 2020. Global Market Insights says that the power and flexibility provided by gas-powered equipment, which has a greater operating range and higher power output than electric equipment , will support continued growth in garden equipment .

Walk-behind equipment is the first choice

Walk-behind equipment is expected to account for more than 70% of the garden equipment market share by 2027. Walk -behind equipment offers great convenience, such as flexibility, low maintenance costs, ease of operation, and the ability to work effectively in confined environments . In addition, technological advances in aesthetics and performance are also attracting the attention of some consumers .

Asia Pacific market has the fastest growth

Global Market Insights said that the Asia-Pacific garden equipment market is expected to account for more than 10% of the total market share during 2021-2027 . Economic development, rapid urbanization, and increase in commercial housing are stimulating market demand in the Asia-Pacific region .

In addition, the global spread of the COVID-19 pandemic is also a major opportunity for the development of the garden equipment market. Affected by the pandemic, more and more consumers are forced to stay at home, and these people have more time to decorate their homes and gardens. During this period, DIY and gardening activities have emerged in large numbers, and gardening activities have also ushered in a certain degree of booming development .

The rapid growth of interest in gardening activities will greatly promote the penetration of the garden equipment market . Currently, consumers' demand for multifunctional and ergonomically designed garden tools is growing. Sellers can develop more new products that meet consumer needs based on market trends to enhance their competitiveness in the market.

Big Sell

Anti-dumping

Garden equipment