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FTZ Authority Sought for Carbon Fiber, Heavy Equipment Factories

Thursday, June 13, 2013
Sandler, Travis & Rosenberg Trade Report

Alabama Carbon Fiber Plant. The Foreign-Trade Zones Board has received from the Huntsville-Madison County Airport Authority, grantee of FTZ 83, a request for production authority at the Toray Carbon Fibers America Inc. facility in Decatur, Ala. This facility is used for the production of polyacrylonitrile-based carbon fiber and PAN fiber, the primary material input for the company’s carbon fiber, and will produce carbon fiber from both its own domestically-produced PAN and from foreign-sourced PAN. A separate application for subzone status for this facility is planned.

Production under FTZ procedures could exempt Toray from customs duty payments on the foreign materials used in export production. The company anticipates that some 15-20% percent of the plant's carbon fiber shipments will be exported and that some 5-10% of its PAN fiber production will be exported. On its domestic sales, Toray would be able to choose the duty rate that applies to its finished carbon fiber (zero) for specified foreign inputs. Toray would also be exempt from duty payments on any foreign-origin materials that become scrap or waste during production. In addition, customs duties could possibly be deferred or reduced on foreign-status production equipment.

Comments on this request are due no later than Aug. 12.

Texas Heavy Equipment Plant. The FTZ Board has received from the Calhoun-Victoria Foreign Trade Zone Inc., grantee of FTZ 155, a notification of proposed production activity at the Caterpillar Inc. facility in Victoria, Texas, which is used for the production of excavators and related frame assemblies. FTZ activity would be limited to the specific foreign-status materials and components and specific finished products listed in the notification and subsequently authorized by the FTZ Board. Comments on this notification are due no later than July 23.

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