Stiff duties on imported nails — along with price hikes in the cost of Chinese steel — have led to double-digit increases in the cost of most types of commonly used nails. The steep duties (roofing nails and collated staples and finish nails are exempt) are the result of an anti-dumping petition filed with the U.S. Department of Commerce in May 2007 by five domestic manufacturers and a labor union. In mid-January of 2008, the department issued a preliminary determination in favor of the petitioners and began requiring that importers pay duties ranging from just over 20 percent of invoice value to nearly 120 percent. The actual duty charged each individual manufacturer varies according to a complex formula best understood by specialists in international trade, but it averages out to about 30 percent across the industry.

Is the price spike just a short-term market blip? Probably not. Although the Commerce Department will recalculate the duties before issuing a final ruling in early June of this year, industry observers hold out little hope that they will be rolled back significantly. "History tells you that the numbers might go up or down a little with the...

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