German Customs dispute disrupts plywood imports from China

Laminated woodThe importance of tariff classification and its impact on statistical and economic data – German imports of hardwood plywood from China continue to be affected by a dispute between the German trade and customs officials. In the last three years, customs officials, particularly at the port of Bremerhaven, have been checking Chinese plywood to ensure that boards are cross-laminated rather than laid parallel to each other.

According to German customs, boards should be reclassified as Laminated Veneer Lumber (LVL) if not fully cross-laminated. This is frequently the case with lower-quality Chinese plywood manufactured using small veneer pieces for the cores. LVL incurs a higher rate of duty of 10% compared to 7% for plywood. Roughly 40% of Chinese hardwood plywood deliveries into Germany were reclassified in this way in 2012.

German import merchants and the timber trade federation GD Holz have held talks with German customs to try to more clearly define which products should be considered plywood and which LVL. According to GD Holz, these talks have been unproductive so far and customs continue to reclassify Chinese plywood. Several German importers have now filed lawsuits and results are still pending. At the same time, GD Holz report that since 2014, several importers have been reimbursed for some instances of excessive duty paid. However, customs has not revealed why reimbursements were offered in some cases but not in others.

The uncertainty created by the dispute in Germany may partly explain the recent rise in imports of Chinese hardwood plywood into ports in Belgium and Netherlands. German buyers may be avoiding excess duty by buying from stocks landed in these neighbouring European countries.

The reclassification process has led to inconsistencies in the statistical data on German hardwood plywood imports. Data derived from Eurostat indicates that German imports fell by 18.3% to 34,700 cu.m in the first five months of 2015. This followed a decline of 5.5% to 103,000 cu.m for the whole year 2014.

However, the Eurostat data deviates from figures published by the German Federal Statistical Office (Destatis) which indicate a 62% increase in German hardwood plywood imports from China in the first quarter of 2015. On enquiry, Destatis note that they have adjusted their data downwards for 2014 to take account of plywood reclassified as LVL.

However Destatis have not yet made the same adjustment to the 2015 data. As a result, Destatis data on deliveries to Germany appear to surge this year. Overall, once all adjustments are made, Destatis reckon German imports of Chinese hardwood plywood in the first five months of 2015 were probably around the same as last year.

Containers conveying Mozambican MiGs stuck in Germany

MiG-21_Fishbed_400x300Three MiG-21 fighter jets destined for Mozambique are stuck in Germany due to a lack of necessary permits. They are part of a batch of eight being shipped from Romania. Romanian company Aerostar is overhauling six MiG-21bis and two MiG-21UM trainer aircraft for the Mozambique Air Force and is also providing training for Mozambican MiG-21 pilots. Three MiG-21s were seen flying at Aerostar’s Bacau facility last year.

On Sunday Germany’s Der Spiegel reported that three MiG-21s were transported from the Romanian capital Bucharest by train in six containers and were to have been subsequently shipped to Mozambique from the Germany port of Bremerhaven. However, although the aircraft were declared according to procedure, their transport was done without the necessary permits and they were stopped. Der Spiegel reported that Germany’s public prosecutor will investigate the possible breach of arms control laws. The publication noted that Aerostar was found guilty of a similar incident in 2008. In 2012 German customs officials confiscated MiG-29 engines for Algeria and Tu-142 engines for India over the lack of necessary permits.

The Mozambique Air Force is slowly rejuvenating, considering that until recently it was almost entirely inoperable, suffering poor serviceability since independence from Portugal in 1975 and the collapse of the Soviet Union and its financial support in the early 1990s. The arrival of the MiG-21s will give the Air Force a jet capability not had in years, as its existing MiG-21s have fallen into disrepair and are grounded.

In addition to the MiG-21s, Mozambique has apparently bought two Aerostar Festival side-by-side light aircraft and will get an overhauled Aero Vodochody L-39ZO jet trainer. Late last year it emerged that Mozambique’s Air Force would also receive two second hand Antonov An-26B transport aircraft after they have been refurbished in the Ukraine. Source: Defence Web