CSWP2 2017 ER
Certain Carbon Steel Welded Pipe
Statement of Reasons

[16] On May 14, 2012, following a complaint filed by Novamerican Steel Inc. and Bolton Steel Tube Co. Ltd., the CBSA initiated an investigation pursuant to subsection 31(1) of SIMA, into the dumping of certain CSWP originating in or exported from Chinese Taipei, India, Oman, Korea, Thailand, the Republic of Turkey (Turkey), and the UAE; and the subsidizing of certain CSWP from India, Oman, and the UAE.

[17] On November 9, 2012, pursuant to subsection 41(1) of SIMA, the CBSA made final determinations respecting: the dumping of certain CSWP originating in or exported from Chinese Taipei, India, Oman, Korea, Thailand, and the UAE, and the subsidizing of certain CSWP from India.^{Footnote 9}

[18] On the same date, the CBSA terminated the dumping investigation with respect to certain CSWP originating in or exported from Turkey as the margin of dumping for these goods was insignificant. Similarly, the subsidy investigations with respect to certain CSWP originating in or exported from the UAE and Oman were terminated as the goods from the UAE were not subsidized, and the goods from Oman had been subsidized, but the amount of subsidy was insignificant.

[19] On December 11, 2012, pursuant to subsection 43(1) of SIMA, the CITT found that the dumping of certain CSWP originating in or exported from Chinese Taipei, India, Oman, Korea, Thailand, and the UAE, and the subsidizing of certain CSWP originating in or exported from India, was threatening to cause injury to the domestic industry in Canada.^{Footnote 10}

[20] On May 7, 2013, the CBSA concluded a re-investigation to update the normal values and export prices of certain carbon steel welded pipe originating in or exported from Chinese Taipei, India, Oman, Korea, Thailand, and the UAE. The CBSA did not initiate a re-investigation of the amounts of subsidy in respect of subject goods originating in or exported from India.^{Footnote 11}

[21] On June 25, 2014, Chinese Taipei requested consultations with Canada at the World Trade Organization (WTO) with respect to anti-dumping measures imposed by Canada on certain CSWP originating in or exported from Chinese Taipei. In its request for consultations, Chinese Taipei claimed that Canada’s imposition of anti-dumping measures appeared to be inconsistent with Canada’s international trade obligations under the General Agreement on Tariffs and Trade 1994 and the WTO Anti-dumping Agreement.

[22] On January 22, 2015, Chinese Taipei requested the Dispute Settlement Body (DSB) of the WTO to establish a panel to examine these claims. The DSB established a panel on March 10, 2015.

[23] On December 21, 2016, the panel report in Canada — Anti-Dumping Measures on Imports of Certain Carbon Steel Welded Pipe from The Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu (DS482) was circulated to WTO members. In its report, the panel found certain aspects of SIMA and the CBSA’s final determination of dumping in respect of certain CSWP from Chinese Taipei and the CBSA’s calculation for the anti-dumping duty rates to be inconsistent with the WTO Anti-dumping Agreement. At its meeting on January 25, 2017, the DSB adopted the panel report.

[24] With regard to the DSB recommendations in DS482, and following a request from the Minister of Finance on July 28, 2017, the CBSA initiated a review of the final determination of dumping for certain CSWP originating in or exported from Chinese Taipei and the CITT initiated a review of its threat of injury finding in respect of the same goods.

[25] On September 29, 2017, pursuant to paragraph 76.1(2)(b) of SIMA the CBSA continued the final determination of dumping with respect to certain carbon steel welded pipe originating in or exported from Chinese Taipei, with the following amendments: the CBSA terminated the dumping investigation regarding certain carbon steel welded pipe exported to Canada by Chung Hung Steel Corporation and Shin Yang Steel Co. Ltd.; and revised the margins of dumping for the same goods originating in or exported from Chinese Taipei determined for all other exporters.^{Footnote 12}

[26] On July 29, 2017, pursuant to subsection 76.03(2) of SIMA, the CITT issued a notice concerning the expiry of its finding, which was scheduled to expire on December 8, 2017. Based on the information filed during the expiry process, the CITT decided that a review of the finding was warranted.

[27] On December 8, 2017, the CITT confirmed that the dumping of certain carbon steel welded pipe, excluding those goods exported by Chung Hung Steel Corporation and Shin Yang Steel Co. Ltd., had threatened to cause injury. Therefore, the CITT continued its finding made in Inquiry No. NQ-2012-003, excluding for greater certainty the goods exported by Chung Hung Steel Corporation and Shin Yang Steel Co. Ltd.

[28] As well, on December 8, 2017, the CITT initiated an expiry review of its finding pursuant to subsection 76.03(3) of SIMA. In its initiation of the expiry review, the CITT decided not to initiate an expiry review in relation to certain carbon steel welded pipe exported from the UAE by Conares Metal Supply Ltd.

[29] On December 11, 2017, the CBSA commenced an expiry review investigation to determine whether the expiry of the finding is likely to result in continued or resumed dumping and/or subsidizing of the subject goods.

[31] CSWP, also commonly referred to as standard pipe, covers a wide range of pipe products generally used in plumbing and heating applications for the low-pressure conveyance of water, steam, natural gas, air, and other liquids and gases. CSWP, or standard pipe, may also be used in air conditioning systems, in sprinkler systems for fire protection, as structural support for fencing, as piling, as well as for a variety of other mechanical and light load-bearing applications.

[32] The size of CSWP is generally specified by two values: a nominal pipe size (NPS) and a schedule. The NPS relates roughly to the inside diameter of the pipe while the schedule relates to the wall thickness. For a given NPS, the wall thickness will increase as the schedule number increases. For example, CSWP with an NPS of 1 inch (NPS 1) and made to ASTM A53, Schedule 40 requirements will have an outside diameter of 1.315 inches and a wall thickness of 0.133 inch while the same pipe meeting the requirements of ASTM A53, Schedule 80 will have an outside diameter of 1.315 inches and a wall thickness of 0.179 inch.

[33] Although CSWP is generally produced to industry standards such as ASTM A53, ASTM A135, ASTM A252, ASTM A589, ASTM A795, ASTM F1083, Commercial Quality and AWWA C200-97, it may also be produced to foreign standards such as BS1387 or to proprietary specifications as is often the case with fencing pipe. While standard pipe may be manufactured to any of the standards mentioned above, the ASTM A53 specification is the most common as it is considered to be the highest quality and is suitable for welding, coiling, bending and flanging.

[34] Standard pipe may be sold with a lacquer finish, or a black finish as it is sometimes referred to in the industry. It may also be sold in a galvanized finish which means it has been treated with zinc. Both types of finish are intended to inhibit rust although the galvanizing process will deliver a superior result. Galvanized pipe will sell at a premium to black standard pipe because of this, and the fact that zinc costs much more than lacquer.

[50] On December 11, 2017, the CBSA sent a notice concerning the initiation of the expiry review investigation and ERQs to known Canadian producers, importers and exporters. The GOI was also sent an ERQ relating to subsidy.

[51] The ERQs requested information needed to consider the expiry review factors, as found in subsection 37.2(1) of the Special Import Measures Regulations (SIMR).

[52] Two Canadian producers, four importers, and one exporter in India participated in the expiry review investigation and responded to the ERQs.

[53] A response to the CBSA’s subsidy ERQ was received from the GOI.

[54] A case brief was received on behalf of the Canadian producer Nova.

[55] No importers or exporters provided a case brief or a reply submission.

[56] The information considered by the CBSA for purposes of this expiry review investigation is contained on the administrative record. The administrative record includes the exhibits listed on the CBSA’s Exhibit Listing, which is comprised of the CITT’s administrative record relating to the initiation of the expiry review, CBSA exhibits and information submitted by interested persons, including information which they feel is relevant to the decision as to whether dumping and/or subsidizing is likely to continue or resume, if the finding is rescinded. This information may consist of expert analyst reports, excerpts from trade magazines and newspapers, orders and findings issued by authorities of Canada or of a country other than Canada, documents from international trade organizations such as the World Trade Organization and responses to the ERQs submitted by domestic producers, importers, exporters and foreign governments.

[57] For purposes of an expiry review investigation, the CBSA sets a date after which no new information submitted by interested parties may be placed on the administrative record or considered as part of the CBSA’s investigation. This is referred to as the closing of the record date. This allows participants time to prepare their case briefs and reply submissions based on the information that is on the record as of the date the record closed. For this expiry review investigation, the record closed on February 9, 2018.

[58] The CBSA will normally not consider any new information submitted by participants subsequent to the closing of the record date. However, in certain exceptional circumstances, it may be necessary to permit new information to be submitted. The CBSA will consider the following factors in deciding whether to accept new information submitted after the closing of the record date:

1. the nature, relevance, materiality and volume of the information;
2. the difficulties encountered by the participant in obtaining or submitting the information by the date specified (for example, the availability of the information or emergence of new or unforeseen issues);
3. whether the information can reasonably be taken into consideration by the CBSA for purposes of the proceedings including whether there is sufficient time to verify the information;
4. whether other parties are likely to be prejudiced if the information is used (for example, the opportunity for other participants to respond to the information);
5. whether acceptance of the information would compromise the ability of the CBSA to conduct the proceedings expeditiously; and
6. any other factors that are relevant in the circumstances.

[59] Participants wishing to file new information after the closing of the record date, either separately or in case briefs or reply submissions, must identify this information so that the CBSA can decide whether it will be included in the record for purposes of the determination.

[60] In the current expiry review investigation, counsel for Nova submitted additional information to the CBSA subsequent to the close of record date of February 9, 2018. Counsel requested that the CBSA take the information into consideration in its deliberations. In a letter dated February 15, 2018, the CBSA advised Nova’s counsel that the CBSA would not take into consideration the documents submitted on February 12, 2018, because the information submitted was available prior to the close of the record and should have been submitted prior to February 9, 2018. Furthermore, the relevance and materiality of the information submitted was not critical to the CBSA’s consideration of whether the expiry of the finding is likely to result in the continuation or resumption of dumping and/or subsidizing of the goods.

Nova

[61] Nova made a representation through its case brief in support of its position that dumping from Chinese Taipei, India, Oman, Korea, Thailand, and the UAE is likely to continue or resume in the event the present finding is rescinded. Accordingly, Nova argues that the measures should remain in place.

[62] The main factors identified by Nova can be summarized as follows:

International Market Conditions

• Global economic conditions
• Global overcapacity and capacity increases
• China’s impact on Asian steel

Chinese Taipei

• Chinese Taipei’s CSWP capacity and steel production
• Chinese Taipei’s economic slowdown and propensity to export
• Exports to other markets

India

• India’s CSWP capacity and steel production
• India’s propensity to export
• Exports to other markets

Oman

• Oman’s CSWP capacity
• Oman’s economic slowdown and propensity to export
• Export to other markets

Korea

• Korea’s CSWP capacity and steel production
• Korea’s economic forecast propensity to export
• Exports to other markets

Thailand

• Thailand’s CSWP capacity and steel industry
• Thailand’s economic outlook and propensity to export
• Exports to other markets

UAE

• UAE’s steel production and CSWP overcapacity
• UAE’s propensity to export

Behaviour of Subject Country Exporters While the Finding has been in Effect

• Subject countries’ presence in the Canadian non-subject pipe market
• Exports of similar products made on the same equipment
• Subject countries’ recent export and domestic pipe prices

Other Factors

• Anti-dumping and countervailing duty measures by Canada and other countries in respect of goods of the same description or in respect of similar goods
• Competition with low-priced new offshore sources

[63] Nova submits that the international market conditions provide important context for macro-economic trends effecting CSWP. Several global developments are currently affecting the market for CSWP which would make the Canadian domestic industry susceptible to resumed injury if the finding is rescinded. These developments are further explained below.

Global Economic Conditions

[64] Nova contends that structural imbalances along with the increased production, coupled with high operating costs significantly outweigh the recent modest improvement in the global steel industry.^{Footnote 17}

[65] As noted by the Chair of the OECD Steel Committee in late September 2017, despite the modest recovery in the global steel market, structural imbalances continue to be a challenge. Although moderate demand growth is expected in 2017 and 2018, it will not eliminate concerns about supply-demand imbalance in the global market.^{Footnote 18}

[66] Nova referred to the “Steel Market Developments” publication issued by the OECD for Q2 2017 indicating that crude steel production is seeing growth in all major regions of the world, with double-digit growth in several regions.^{Footnote 19}

[67] Nova also noted that a contributing factor to the difficulties of the steel industries is the increase in operating costs for producing steel in the past year. Many steel makers continue to have large liabilities weighing on their balance sheets and the sector is still underperforming most other industries in terms of profitability.^{Footnote 20}

Global Overcapacity and Capacity Increases

[68] Nova points to a report issued by US law firm Wiley Rein LLP in April 2016, stating that global overcapacity continues to affect the profitability of the steel industry, as its financial situation is weaker than it has been in years. From 2000 to 2015, the global steel industry added more than 1.2 billion MT of crude steel production capacity, meanwhile, demand growth over that time is estimated at 700 million MT.^{Footnote 21}

[69] Nova noted that in the OECD’s “Steel Market Developments” publication that steel capacity utilization fell to slightly below 70% in 2015-2016. In September 2017, the OECD Steel Committee chairperson noted that while global capacity is showing signs of adjusting to lower levels of demand, the alleviation of global excess capacity is still well below acceptable levels.^{Footnote 22}

[70] In addition to the OECD’s report on excess capacity, a report from the Global Forum on Steel Excess Capacity (GFSEC) notes that the current steel production capacity levels significantly exceed global consumption and capacity closures continue to be partially offset by capacity expansions. In 2016, the excess capacity surplus was estimated to be 737 million MT, the highest in the history of the industry.^{Footnote 23}

[71] Furthermore, the GFSEC data shows that approximately 137 million MT of steel production capacity was reportedly shut down from 2014 to 2016, while over the same period, 82 million MT of steel production capacity was added. The GFSEC concluded a meaningful reduction of the structural imbalance had not been achieved and “further significant reductions in global excess capacity will be needed in order to avoid a prolonged structural crisis in the steel industry.”^{Footnote 24}

China’s Impact on Asian Steel

[72] Nova submits that China’s massive steel capacity and production continues to be the most important cause of distress to the global steel industry. As China’s demand continues to weaken, and overcapacity and excess supply fail to decline at a reciprocating pace, cheap Chinese steel will continue to be pushed onto the global market. China as the world’s largest steel exporter, accounted for 57.9 million MT of steel exports from January through to September 2017. In this time period, four of the subject countries (Chinese Taipei, India, Korea and Thailand) are among China’s top ten steel markets, representing 53% of China’s steel export volume.^{Footnote 25}

[73] The Government of China’s announced in 2016 that its goal is to cut steelmaking capacity by 100 to 150 million tonnes by 2020. Nova submits that, due to capacity creep^{Footnote 26}, idle capacity, exceptions granted to steel mills by the government, and China’s history of past efforts, the likelihood of the Government of China from reaching its goal is questionable. Additionally, in light of the aforementioned planned cuts to capacity, Chinese steel production has continued to grow with crude steel production in the first half of 2017 increasing by 4.2% in comparison to the same period the previous year.^{Footnote 27}

[74] Additionally, Nova states that the gap between production and apparent consumption, which was almost non-existent in 2009, has grown steadily larger as Chinese production outpaced the country’s demand by 67.9 million MT during the period of January and September 2017. Nova stresses, reduced demand in China is presently, and will continue to, have an impact in the global steel market.^{Footnote 28}

Chinese Taipei’s CSWP Capacity and Steel Production

[75] Nova states that, although Chinese Taipei’s production of crude steel decreased from 23.2 million MT in 2014 to 21.4 million MT in 2015, it increased to 21.8 million MT in 2016. In 2016 the gap between production and demand widened to a peak of 4.3 million MT and, in the first half of 2017, the production value of Chinese Taipei’s steel sector grew by about 30% as compared to the same period in 2016. Based on this, Nova concludes that Chinese Taipei has a significant volume of steel available for export.^{Footnote 29}

[76] Nova points out that Chinese Taipei’s steel-making capacity remains significantly higher than production and refers to an OECD report listing the country’s crude steel-making capacity as 28.5 million MT during the period 2014-2016.^{Footnote 30}

[77] According to the Simdex Metal Tube Manufacturers Worldwide Guide, there are 11 companies in Chinese Taipei that produce various types of carbon steel welded pipe. Nova estimates the total capacity of CSWP production in Chinese Taipei to be more than 764,000 MT and notes that its estimate is conservative given that production capacity information for all 11 companies is not publicly available.^{Footnote 31}

Chinese Taipei’s Economic Slowdown and Propensity to Export

[78] Nova notes that Chinese Taipei’s GDP growth rate is low, at 1.5% in 2016 and 2.0% in 2017. Nova also notes that the increase in the rate of growth of the GDP in 2017 is attributed in major part to the country’s export orders, which increased 14.84% compared to 2016.^{Footnote 32}

[79] Nova states that Chinese Taipei is the world’s 12th largest exporter of steel with 11.1 million MT of steel being exported in 2015 and 12.2 million MT exported in 2016. Of this total, 200,000 MT to 400,000 MT of steel was directed to Canada.^{Footnote 33}

[80] Nova provides examples of four pipe producers in Chinese Taipei who, it claims, are export-oriented. According to Nova, the enthusiasm exhibited by CSWP producers in Chinese Taipei to export indicates a likelihood that these producers and exporters will look to Canada if the finding were to expire.^{Footnote 34}

Exports to Other Markets

[81] Nova makes reference to a report issued by the International Trade Administration (ITA) of the US Department of Commerce showing Chinese Taipei’s main trading partners for pipe and tube products to be the US, Australia, and China.^{Footnote 35}

[82] Nova notes that there are a number of measures presently in place in the US against various pipe products from Chinese Taipei, including a recent decision by the International Trade Commission (ITC) continuing its anti-dumping and countervailing duty orders on circular welded pipe and tube (CWP) from several countries including Chinese Taipei. Nova further notes that, in the aforementioned decision, the ITC made reference to Global Trade Atlas data showing that for tariff subheading 7306.30, a category that includes CWP and may also include non-subject goods, Chinese Taipei exports of CWP to the US market increased from 3,321 tonnes in 2012 to 21,633 tonnes in 2016. Despite the measures in place, the US remains Chinese Taipei’s most important market for pipe and tube products, demonstrating to Nova the country’s focus on export markets.^{Footnote 36}

[83] Nova notes that Australia imposed anti-dumping measures on hollow structural sections from Chinese Taipei in 2011 and continued the measures in July 2017. Nova cites the above examples as evidence of export trends and practices utilized by steel and pipe exporters in Chinese Taipei, reinforcing the domestic industry’s concern that dumping will resume should the finding be allowed to expire.^{Footnote 37}

India’s CSWP Capacity and Steel Production

[84] Nova states that India has significant crude steel-making capacity. The country’s crude steel production increased 65% between 2009 and 2016 and in 2017 it grew to 101.4 million MT, a 6.2% increase compared to 2016. In the first nine months of 2017 production outpaced apparent consumption by approximately 5 million MT.^{Footnote 38}

[85] Nova makes reference to an OECD report listing India’s crude steel-making capacity as 108 million MT in 2014, 114.5 million MT in 2015 and 125.8 million MT in 2016. Nova also notes that India’s steel secretary is on record stating that the country’s steel capacity is targeted to reach 150 million tonnes by 2020 and that the country’s National Steel Policy 2017 encourages capacity additions.^{Footnote 39}

[86] Nova states that India has significant CSWP making capacity and that most of India’s top steel producers also produce tube and pipe. As examples, Nova offers Tata Steel, whose 24.5 million MT of production includes tube, and Steel Authority of India Ltd., whose 14.4 million MT of production includes tubular products.^{Footnote 40}

[87] Nova also states that there are numerous pipe and tube producers in India that produce CSWP. According to the Simdex Metal Tube Manufacturers Worldwide Guide, 53 companies produce various forms of carbon welded pipe in India. Based on these identified producers, Nova conservatively estimates their CSWP capacity to be in excess of 4.9 million MT.^{Footnote 41}

[88] Nova notes that the CBSA, through its independent research, has identified a number of other companies that produce CSWP in India, in addition to those identified by Simdex. Meanwhile, certain of the companies identified by both the CBSA and Simdex report production capacity figures greater, as per the CBSA’s research, than those reported by Simdex.^{Footnote 42}

India’s Propensity to Export

[89] Nova refers to Surya Roshni Limited’s Annual Report 2016-2017 which states that, to boost steel demand, the Government of India launched the National Steel Policy 2017 (NSP) to propel higher spending on infrastructure and construction through government initiatives. According to the company, the NSP sets targets of 225 million MT for crude steel production and 300 million MT for crude steel capacity by 2030 and provides preference to domestic Indian manufacturers by stipulating a 15% minimum value addition in bidding on government procurements. As a result, imports of steel have declined and the export of steel from India has boosted. Furthermore, Surya Roshni reports that, due to the “Make in India” concept by the Prime Minister, drastic steps have been taken by the government to improve overall steel production, consumption and exports. As a result, production and exports of steel and its subsidiary products, especially steel pipes, have started increasing during the year 2016-17.^{Footnote 43}

[90] Nova states that exports are an important part of the Indian steel and CSWP industry. According to an ITA report, India is the world’s fourteenth largest steel exporter with exports of 11.8 million MT in the first three quarters of 2017 valued at $US 7.8 billion. As compared to the same period in 2016, steel exports increased 68% on a volume basis and 75% on a value basis. Exports as a share of production rose to 15.6% in that time period compared to 9.9% in 2016.^{Footnote 44}

[91] According to the same ITA report, in the first three quarters of 2017 exports of pipe and tube products from India amounted to 1.1 million MT, representing 9% of all steel exports from that country. During that period, India’s top five export markets for pipe and tube products include Canada along with the US, Saudi Arabia, the UAE and Thailand.^{Footnote 45}

[92] Nova points to UN Comtrade trade data showing Indian pipe exports (HS tariff code 730630) as 223,066 MT in 2014, 211,591 MT in 2015 and 188,790 MT in 2016. Nova claims that India’s exports of CSWP have remained consistently elevated over time despite the imposition of anti-dumping measures against the country’s exports by the US in 2016. The ITC’s decision, concerning circular welded pipe and tube (CWP) from several countries including India, makes reference to GTA data indicating that Indian exports of CWP increased from 110,646 tonnes in 2012 to 209,268 tonnes in 2016.^{Footnote 46}

[93] Nova states that further evidence of the disposition to export by CSWP producers in India is found in company policies and websites, such as those of Bhandari Foils and Tubes, Good Luck India Limited, Jindal Saw Ltd., Rama Steel Tubes, and Technocraft. Nova concludes that the enthusiasm of Indian CSWP producers for export markets indicates the likelihood of these producers and exporters to look to Canada if the finding were to expire.^{Footnote 47}

Exports to Other Markets

[94] Nova states that, according to UN Comtrade data, India’s most significant export markets for pipe are as follows: UAE, UK, US and Belgium. With regards to the US, imports of pipe from India increased from 2014 to 2016 despite an anti-dumping case and preliminary duties imposed on Indian pipe producers in November 2015, and final duties in September 2016. The export volumes demonstrate, according to Nova, that Indian pipe producers are producing pipe products in quantities and at prices that withstand the imposition of duties.^{Footnote 48}

[95] Nova states that volumes of Indian pipe products to the UK have fallen from 2014 – 2016 in part due to the recent economic and political instabilities in the country, including a suffering construction sector and the Brexit vote. The UK’s construction Purchasing Managers’ Index plunged in June 2017 while forecasts for 2018 look bleak, with growth prospects for the UK construction industry being downgraded. Based on this Nova concludes that Indian pipe producers will be forced to seek alternative markets for their products.^{Footnote 49}

Oman’s CSWP Capacity

[96] Nova states that there are two CSWP producers in Oman and estimates their combined pipe capacity to be 500,000 MT. Nova notes that its estimate is conservative and it understates the full capacity of the Omani industry, given that information regarding all companies is not publicly available.^{Footnote 50}

[97] With regard to one producer, TMK Gulf International Pipe Industry, Nova states that the company boasts a 240,000 square metre facility. In the second half of 2016 the company announced the completion of a mill expansion by way of a press release. Nova says that the press release states that a deliverable of the expansion will be to increase ‘the export of local quality products to other markets with fair and competitive prices.”^{Footnote 51}

[98] With respect to the other producer, Al Jazeera Steel Products Company SAOG (Jazeera), Nova notes that, although Oman experienced a downturn in demand for steel and pipe in 2016 due to depressed oil prices and prudent spending by government, the company reported its highest production volumes ever, with tube mill volumes climbing from 162,872 MT in 2015 to 167,757 MT in 2016.^{Footnote 52}

[99] Considering the weak demand in Oman, Nova attributes the increased production to a disregard for market forces and a strong indication that the production will be exported.^{Footnote 53}

Oman’s Economic Slowdown and Propensity to Export

[100] Nova refers to an October 2017 report from the World Bank stating that growth in Oman continued to be held back by lower oil production and weaker consumption and investment. According to the report, real GDP is projected to slow down to 0.1% in 2017 from 2.8% in 2016 but is forecasted to increase to 3.4% in 2018 and 2.9% in 2019. When Oman joined most Organization of the Petroleum Exporting Countries (OPEC) non-members in participating in oil production cuts in 2017, its hydrocarbon sector contracted by 2.8%. Non-hydrocarbon GDP growth was also estimated to contract to 2.5% in 2017 from 3.4% in 2016 due to public spending declines with knock-on effects on consumption and investment.^{Footnote 54}

[101] Nova submits that, as Oman attempts to move closer to a post-oil economy by diversifying its economy, including manufacturing, such diversification will be felt in its export market. Nova points out that Jazeera’s 2016 Annual Report states that “…we have diversified to other export markets in 2016 and hope to build on this in 2017” while the company’s website states that it markets its products to countries across the globe, including North America.^{Footnote 55}

[102] Nova points to a March 2017 online article reporting that, despite sluggish demand in the gulf region and an anti-dumping finding by the US, Jazeera recorded robust growth in sales and net profit as it diversified into other export markets. Nova states that this clearly signifies Jazeera’s focus on export orientation and its business practice of export diversification when trade measures are imposed. Based on this, Nova submits, Canada will become Jazeera’s target “other export market” should the measures be permitted to expire.^{Footnote 56}

Exports to Other Markets

[103] According to UN Comtrade data, Oman’s most significant export markets for pipe products are the US and Kuwait. Nova asserts that, due to anti-dumping duty being imposed on Omani pipe products in the US market, Omani producers have shifted their export focus to alternative markets. Nova also asserts that it is likely Omani producers will look to markets other than Kuwait because OPEC-related oil production cuts have depressed GDP growth while a poor business environment and the large size of the public sector have hampered the development of the private non-oil sector. Nova submits that, as Oman looks to diversify its export markets in the face of trade barriers abroad and reduced demand in the Gulf area, the Canadian market will be attractive to low price exports should the finding be allowed to expire.^{Footnote 57}

Korea’s CSWP Capacity and Steel Production

[104] Nova submits that between 2009 and 2012, Korea’s crude steel production grew by 42%, and since then, production has fluctuated and averaged 69 million MT per year through to 2016. Additionally, the nominal crude steelmaking capacity in Korea remains high at 85.7 million MT and Nova believes domestic producers will be looking to use this significant excess steel capacity.^{Footnote 58}

[105] According to the Simdex Metal Tube Manufacturers Worldwide Guide, there are 23 companies that produce various types of CSWP in Korea. Based on the information available, Nova has estimated a total capacity of CSWP production in Korea to be more than 3,972,000 MT. The complainant notes that this production capacity is conservative since information regarding all companies is not publicly available.^{Footnote 59}

[106] Furthermore, Nova states that Korea is constantly under expansion. Hyundai Hysco, one of the largest pipe producers in Korea has made multiple capacity investments since 2010, including the addition of two blast furnaces in 2010, followed by an additional third blast furnace in 2013.^{Footnote 60}

Korea’s Economic Forecast and Propensity to Export

[107] According to Nova, the propensity of Korean CSWP producers to export remains unchanged in light of a stable economy. Nova states, Korea’s real GDP growth is projected to remain flat at 3% in 2017 and 2018 and a rebound in international trade and greater fiscal support are projected to sustain this growth through 2019. However, construction investment is projected to slow following tighter regulations on housing and mortgage lending. An OCED report underpinned exports as a contributor to economic growth as construction investment is slowing.^{Footnote 61}

[108] Nova provided reports from the Federal Steel Supply Inc. and the Korean Iron and Steel Association that indicated that the future of Korean steel looks bright due to export opportunities and Korea’s steel product exports from January through to August of 2017 increased by 72.2% from the same period the previous year.^{Footnote 62}

[109] As documented in the International Trade Administration’s Steel Export Reports, Korea is the world’s fourth largest steel exporter and in the first three quarters of 2017, Korea exported 23.7 million MT, a 5% increase from 22.5 million MT in the same time period in 2016. With respect to pipe and tube products, Canada is among Korea’s top five export markets along with the US, Kuwait, Japan, and the UAE.^{Footnote 63}

[110] Nova provided several examples of Korean CSWP producers proclaiming their established practices and continued interest in export markets. Nova states, the enthusiasm of Korean CSWP producers to enter export markets establishes if the finding were to expire, they would seek to continue/resume dumping in Canada.^{Footnote 64}

Exports to Other Markets

[111] As noted above, Korea’s primary export markets for pipe and tube products are the US and Japan. Nova submits that there are presently multiple trade findings against a variety of types of Korean pipe in the US. It was determined on January 4, 2018 by the US ITC that the revoking of the existing anti-dumping measures on circular welded pipe and tube from Korea would likely lead to the continuation of material injury within a reasonable foreseeable time.^{Footnote 65}

[112] In light of the above, an article in the Metal Bulletin states that in late 2017, imports of Korean standard pipe to the US has increased compared to the previous year.^{Footnote 66} Nova submits that these increases continue to incur notwithstanding duties in place against Korean circular welded pipe.

[113] With regards to Korean exports to Japan, Nova submits that the Japan’s GDP growth is projected to remain stagnant with only a marginal increase in 2017 attributed to international trade and fiscal stimulus. Furthermore, Japan has its own robust CSWP industry with 15 producers of CSWP. One of these producers has a capacity of 3,900,000 MT, the estimated size of the CSWP capacity of Korea.^{Footnote 67} According to UN Comtrade Data, the volume of Korean pipe exports to Japan have decreased year-on-year since 2014 with a 25% decrease from 2014 to 2016.^{Footnote 68}

[114] Nova submits, as trade sanctions increase in the US and markets such as Japan face decreased demand for CSWP, Korean pipe exporters will be seeking alternative markets such as the Canadian market, if the finding were to expire.

Thailand CSWP Capacity and Steel Industry

[115] Nova submits that the crude steel production and capacity in Thailand is increasing as the most recent report by the Iron and Steel Institute of Thailand states that production in 2016 increased by 23%. Nova also provides data from an OCED Report in 2017 indicating that Thailand’s crude steelmaking capacity has increased by 3.42 million tonnes between 2006 and 2016 representing a 53% increase. Furthermore, in the first three quarters of 2017, Thailand’s steel imports decreased by 18% with the majority of imports being flat products, while pipe and tube imports are lower, at less than 500,000 MT.^{Footnote 69}

[116] Based on the information provided by Nova, there is an estimated total capacity of CSWP production in Thailand of 913,000 MT. Nova submits that the estimate of CSWP capacity is conservative and does not represent the full capacity of the Thai CSWP industry due to information on all companies not being publicly available.^{Footnote 70}

Thailand Economic Outlook and Propensity to Export

[117] Nova submits that Thailand’s GDP growth is expected to increase to 3.7% in 2017 from 3.2% in 2016. However, it is forecasted to decrease slightly to 3.5% in 2019. This forecast is in light of Bloomberg’s report that Thailand will show strong growth next year with growth being fueled by exports and tourism.^{Footnote 71}

[118] Data provided by Nova indicates that pipe exports from Thailand under HS classification number 7306.30 has increased substantially from 74,023 MT in 2014 to 103,797 MT in 2016, representing a 40% increase.^{Footnote 72}

[119] Nova also notes that Thai steel and pipe markets have also been impacted by Chinese and Japanese imports which has prompted anti-dumping measures against China. Due to the rising import share held by China combined with domestic Thai pipe and tube producers’ inability to compete with Chinese prices, anti-dumping measures were imposed by Thailand’s government against China in 2015. Nova states that if Thailand continues to face low-priced imports while simultaneously expanding its own industry, the CSWP producers will be looking to other markets for export.^{Footnote 73}

Exports to Other Markets

[120] According to the data provided by Nova, Thailand’s primary export markets for pipe products are the US, Australia, and Indonesia. Nova notes that the US continues to be a primary export market in light of the anti-dumping duties in force against Thailand since 1985 and continued on January 4, 2018.^{Footnote 74}

[121] Nova states that Australia also has enforced anti-dumping measures in 2015 on Thai imports of hollow structural sections. The companies found to be dumping included known CSWP producers, Samchai Steel Industries Public Company Limited and Pacific Pipe Public Company Limited. Notwithstanding the measures imposed on Thailand, exporters continue to ship various pipe and tube products for which the complainant indicates that the producers are able to withstand these duties and/or change production when necessary.^{Footnote 75}

[122] With regards to Indonesia, Nova reports that the country has nine known domestic producers of CSWP with the largest pipe producer in the country, Steel Pipe Industry, reported to have a production capacity of 588,600 MT, and is presently investing in new plant facilities. Nova believes that with the development of the Indonesian CSWP market, there will be reduced need for voluminous imports of pipe products from Thailand which will be redirected to other attractive markets such as Canada.^{Footnote 76}

UAE Steel Production and CSWP Overcapacity

[123] Nova submits that crude steel capacity and production continues to increase in the UAE, notwithstanding, the instability in the region in recent times. From 2014 to 2016, crude steel production alone grew 30% and capacity developments over the years is outlined in the table below.^{Footnote 77}

Table 3
Nominal crude steelmaking capacity in million tonnes^{Footnote 78}

	2006	2012	2013	2014	2015	2016
Capacity	0.18	2.95	2.95	3.65	3.65	3.65

[124] Nova notes that similar to the developments of crude steel, pipe capacity in the UAE continues to grow as well. Citing a pipe producer ADPICO’s webpage, one of UAE’s largest CSWP producers, ADPICO states that with its future additions it will become one of the largest and most diversified ERW mills in the world with an overall production capacity of almost 1.5 million tonnes. Furthermore, US pipe producer Epic Piping is reported to be opening a 400,000 square foot facility in Abu Dhabi.^{Footnote 79}

[125] With respect to CSWP capacity in the UAE, Nova presents an estimate of total CSWP capacity based on several companies’ publicly available information, as well as the Simdex Metal Tube Manufacturers Worldwide Guide. Based on this information, Nova estimates that the total capacity of CSWP production in the UAE to be 1,981,000 MT. Nova believes this may not represent the full capacity of the UAE industry and submits that the actual capacity is likely higher.^{Footnote 80}

UAE’s Propensity to Export

[126] According to Nova, exports of pipe products from the UAE to the global market have increased year-on-year since 2014 and clearly underpins the country’s focus on exporting.^{Footnote 81} Nova provides several examples from producers in the UAE proclaiming their stature as a global market pipe and tube distributor.^{Footnote 82}

[127] Nova pointed out that UAE’s primary export markets for pipe products are the US, Oman, and Saudi Arabia according to UN Comtrade Data.^{Footnote 83}

[128] Nova expressed concern that Canada would likely see the export of UAE’s substantial excess production due to economic and political uncertainty in its primary export markets, particularly Saudi Arabia. With respect to Saudi Arabia, Nova submits, in 2016 its economy grew at a moderate rate of 1.7% due to oil prices, and in 2017, real GDP growth is forecasted to decrease to 0.3%. Furthermore, construction activity in Saudi Arabia remains sluggish despite the government’s ongoing commitment to vision 2030, and construction output is estimated to have fallen by 2% in real terms in 2017.^{Footnote 84}

[129] With respect to the UAE’s primary export markets, Nova also pointed out that the US ITC went on to find anti-dumping duties against the UAE in regards to circular welded carbon-quality steel pipe, notwithstanding, the Financial Controller of the Universal Group’s testimony to the ITC stating that the Universal Group (an UAE producer) focus is on the UAE markets.^{Footnote 85}

[130] Overall, due to the factors listed above, Nova submits, with the increasing exports since 2014, the enthusiasm of CSWP in the UAE, and the ongoing conditions in the UAE’s largest export markets, that the resumption and/or continuation of dumping in Canada is likely if the CITT’s finding were to expire.^{Footnote 86}

Subject Countries’ Presence in the Canadian Non-Subject Pipe Market

[131] Nova maintains that while the finding has been in place against subject countries, exporters from these countries continue to have a significant presence in Canada’s pipe market by selling high volumes of non-subject pipe at low prices. Nova points to CBSA’s import statistics data, indicating the continued interest in the Canadian market for non-subject CSWP, which by implication must be CSWP above 6 inches.^{Footnote 87}

[132] Nova submits that not only have the subject countries been selling this non-subject pipe in high volumes, but have been doing so at low prices. Import statistics for the SIMA Measures in Force indicates that in 2016 the subject countries shipped over 11,000 MT of non-subject diameter CSWP at an average value for duty of $857 per MT.^{Footnote 88} Nova contends that even with a $150 per MT amount added to the average value of duty to cover ocean freight and brokerage fees, the price of non-subject CSWP was below Nova’s average 2016 selling price.^{Footnote 89}

[133] Nova asserts that the aforementioned demonstrates that exporters of subject goods have remained interested in the Canadian market for CSWP and related products, and is indicative that these exporters will resume dumping CSWP into Canada if the finding expires or is rescinded.

Exports of Similar Products Made on the Same Equipment

[134] Nova submits that similar tube products such as hollow structural sections (HSS) are made from the same feedstock (hot-rolled sheet), by the same mills on the same equipment using the same production process. Nova indicated that three of the subject countries (Chinese Taipei, India and the UAE) have exporters that have continued to demonstrate a keen interest in the Canadian market and are willing and able to ship significant volumes to Canada in the absence of a finding.^{Footnote 90}

[135] Nova references import permit data maintained by Global Affairs Canada to indicate the high volumes of imported HHS from Chinese Taipei, India and the UAE which were 9,239 MT, 15,969 MT, and 3,156 MT respectively in 2017. Nova points to the average pricing of imports of HSS from the US to Canada to demonstrate how the average cost of imports of HHS from Chinese Taipei, India, and the UAE are significantly below US pricing. Nova submits that Canadian and US producers tend to price at similar levels, therefore, significant undercutting of US prices by exporters from these three countries supports an inference that these exporters of CSWP would also undercut US and Canadian producer pricing if they resumed exporting to Canada.^{Footnote 91}

Subject Countries’ Recent Export and Domestic Pipe Prices

[136] Nova submitted information in their case brief outlining its methodology in determining normal values during the POR for the subject goods to demonstrate that the available pricing evidence indicates that exporters from the subject countries would resume dumping if the finding were to expire in Canada. The values determined by Nova were calculated on the basis of Nova’s cost of production as well as publicly available information on major CSWP producers in each of the subject countries. Based on Nova’s analysis, they contend that the calculated margins of dumping for each subject country are significant considering the conservative approach taken in calculating both normal values and export prices.^{Footnote 92}

Anti-Dumping and Countervailing Duty Measures by Canada and Other Countries in Respect of Goods of the Same Description or in Respect of Similar Goods

[137] Nova states that the propensity of subject country exporters to dump CSWP in Canada is further evidenced by the numerous anti-dumping and countervailing measures imposed against them by Canada and other countries.

[138] Nova points out with regards to pipe products under HS code 7306.30, all the subject countries are subject to anti-dumping measures in at least one other major jurisdiction. India, Oman, Korea, Thailand, and the UAE are all subject to US imposed CSWP anti-dumping measures. Australia presently has measures imposed against Chinese Taipei, Korea, and Thailand. Furthermore, Thailand has initiated proceedings regarding CSWP against Korea. Nova maintains that with the restriction of access to major markets due to anti-dumping measures, the likelihood that subject countries will look toward the Canadian CSWP market will increase if the finding is permitted to expire.^{Footnote 93}

Competition with Low-Priced New Offshore Sources

[139] Nova submits that new offshore sources have become significant sources of low-priced imports in Canada in recent years. Nova referenced import statistics compiled by the CBSA which demonstrates that new offshore sources have been selling high volumes of CSWP in the Canadian market at prices well below the average for other imports. The CBSA data indicates that collectively, these countries increased their export volume to Canada by 9,231 MT in 2016 and continue to remain at 49% of all imports in January through September 2017.^{Footnote 94}

[140] Nova states if the finding were to expire, subject country exporters would need to compete on the basis of price with the new offshore sources for market share in Canada. This would substantially increase the likelihood of resumed dumping by the subject countries, as it demonstrates the attractiveness of the Canadian market.^{Footnote 95}

[141] None of the parties contended that resumed or continued dumping of subject goods from Chinese Taipei, India, Oman, Korea, Thailand and the UAE is unlikely if the finding is rescinded.

[143] The CBSA did not receive any ERQ responses, case briefs, or reply submissions from exporters in Chinese Taipei. The CBSA, therefore, relied on information submitted from participating parties, as well as other information on the administrative record, for the purposes of the expiry review investigation with respect to CSWP originating in or exported from Chinese Taipei. While goods exported from Chinese Taipei by Chung Hung Steel Corporation and Shin Yang Steel Co. Ltd were subject to the finding during the POR, due to their exclusion from the CITT’s finding, the goods did not form part of CBSA’s analysis.

[144] During the first three years of the CBSA’s POR of January 1, 2014 to September 30, 2017, Chinese Taipei’s domestic steel market experienced a decrease in production and an even greater decrease in consumption. According to a report issued in May 2017 by the International Trade Administration (ITA) of the US Department of Commerce, Chinese Taipei’s production of crude steel decreased from 23.2 million MT in 2014 to 21.8 million MT in 2016 while consumption decreased from 19.9 million MT to 17.4 million MT. As a result, the gap between supply and demand widened from 3.3 million MT in 2014 to 4.4 million MT in 2016.^{Footnote 96}

[145] While Chinese Taipei’s crude steel production dropped from 2014 to 2016 due to a global supply glut,^{Footnote 97} the country’s steel exports increased slightly from 12.0 million MT to 12.2 million MT.^{Footnote 98} Expressed as a percentage of total steel production, Chinese Taipei’s exports rose from 51.9% to 55.9% during this three year period.^{Footnote 99} The fact that Chinese Taipei’s steel exports rose in a period defined as a ‘global supply glut’ is testament to the country’s competitiveness in steel pricing.

[146] Chinese Taipei is a net exporter of steel products and, in fact, the world’s twelfth largest steel exporter.^{Footnote 100} According to Chinese Taipei’s Ministry of Economic Affairs, the country’s steel exports grew 30.2% in the first seven months of 2017 with China absorbing 13% of the exports, followed by the US at 12.3% and Japan at 8.3%.^{Footnote 101} With respect to the US, Chinese Taipei’s steel exports to that market surged 42.3% from a year earlier, and represented the highest growth recorded for all export markets.^{Footnote 102}

[147] According to the May 2017 ITA report referred to above, Vietnam, Thailand and the Philippines were the only markets for Chinese Taipei’s steel exports to show an increase in value between 2015 and 2016; all other top export markets, including the US, saw value decreases.^{Footnote 103} Considering that Chinese Taipei produces more steel than it consumes and, for a number of years, has exported more than half of all the steel it produces, it is not surprising that steel products from Chinese Taipei would be very competitively-priced in these export markets, including North America.

[148] In 2013 the country’s crude steel-making capacity increased from 26.5 million MT to 28.5 million MT and has remained at this level ever since. A comparison of Chinese Taipei’s crude steel production of 21.8 million MT in 2016 to the country’s steel-making capacity of 28.5 million MT indicates that the country’s steel mills were operating at a 76.5% capacity utilization rate.

[149] While production volumes and production capacities of crude steel producers in Chinese Taipei is somewhat easy to come by, the same information with respect to CSWP producers is not. Being smaller-sized, secondary steel producers, many of whom are not publicly-traded, CSWP manufacturers tend not to divulge commercially sensitive information such as production capacities, sales volumes or selling prices on their websites. Nonetheless, based on both confidential and non-confidential information on the record, the CBSA found that there are eight companies that are capable of producing various types of carbon steel welded pipe in Chinese Taipei^{Footnote 104} and that those CSWP producers considerably outnumber the producers of the same products in Canada.

[150] The May 2017 ITA report, referred to previously, states that the US was the largest market for Chinese Taipei’s exports of pipe and tube products in 2016 at 42% (93.5 thousand metric tonnes).^{Footnote 105} This is a notable fact given the recent decision on January 4, 2018, by the ITC continuing its anti-dumping and countervailing duty orders on circular welded pipe and tube (CWP) from several countries including Chinese Taipei.^{Footnote 106}

[151] Similarly, according to the ITA report, Australia was Chinese Taipei’s second largest export market for pipe and tube products in 2016, notwithstanding the fact that Australia imposed anti-dumping measures on hollow structural sections from Chinese Taipei in 2011 and continued these measures in 2017.^{Footnote 107} The fact that exporters in Chinese Taipei would remain focused on two foreign markets, the US and Australia, despite having anti-dumping measures in place on similar carbon steel tubular products, indicates that the country’s steel producers are heavily reliant on exports.

[152] Based on confidential information on the administrative record, exporters in Chinese Taipei remained active in exporting subject goods to Canada during the POR of January 1, 2014 to September 30, 2017. Based on quantity, imports of subject goods from Chinese Taipei represented more than half of all subject imports during the POR.^{Footnote 108} As well, in each of the three years of the POR, as well as in the first nine months of 2017, anti-dumping duty was assessed by the CBSA against subject CSWP imports from Chinese Taipei.^{Footnote 109} The CBSA’s confidential enforcement data suggests a pattern of exporters from Chinese Taipei pursuing sales in Canada through low prices.

[153] According to a May 2017 report by the Taiwan Steel & Iron Industry Association, the country’s GDP growth rate was 0.7% in 2015, 1.5% in 2016, and was forecasted to be 1.9% in 2017. This is lower than the global GDP growth rates for the same periods of 3.1%, 3.0% and 3.3% (forecasted). The report also shows that, of all steel-consuming sectors, demand in the construction sector fell from 39.2% in 2014 to 33.3% in 2016. The drop in the construction sector is attributed to rising taxes, a slow economic recovery and an oversupplied housing market.^{Footnote 110} According to the Taiwan Institute of Economic Research, the country’s GDP is forecasted to grow by 2.34% in 2018, attributed in large part to a healthy increase in export orders (14.84% increase in 2017).^{Footnote 111} Based on all of the above, it is reasonable to assume that CSWP producers in Chinese Taipei will have to rely more heavily on exports in the near term given the country’s economic performance and the current issues facing the construction sector.

Determination Regarding Likelihood of Continued or Resumed Dumping for Chinese Taipei

[154] Based on information on the record showing Chinese Taipei to be a net exporter of steel products and having a sizable number of CSWP producers; the imposition of anti dumping measures by the US in respect of goods of the same description (i.e., circular welded pipe) and by Australia in respect of similar goods (hollow structural sections) from Chinese Taipei; exporters continuing to export subject goods to Canada at dumped prices during the POR; and decreasing demand for CSWP products in the construction sector in Chinese Taipei, the CBSA determined that the expiry of the finding is likely to result in the continuation or resumption of dumping into Canada of certain carbon steel welded pipe originating in or exported from Chinese Taipei (excluding goods exported from Chinese Taipei by Chung Hung Steel Corporation and Shin Yang Steel Co. Ltd).

[155] The CBSA received an ERQ response from one exporter in India, Manu International. The exporter did not express an opinion regarding whether the continued or resumed dumping and/or subsidizing of CSWP would be likely or unlikely if the CITT’s finding were to expire. Additionally, no case briefs or reply submissions were received from exporters of CSWP originating in or exported from India. The CBSA, therefore, relied on information submitted from the participating parties, as well as other information on the administrative record, for the purposes of the expiry review investigation with respect to CSWP originating in or exported from India.

[156] India, with 95.5 million MT of steel produced in 2016, is ranked as the world’s third largest steel-producing country, behind only China and Japan.^{Footnote 112} The country’s production of steel, as well as its steel-making capacity, have both increased dramatically in the past four years. During the period 2012 to 2016, India’s steel production grew from 77.3 million MT to 95.5 million MT,^{Footnote 113} an increase of 23.5%, while its steel-making capacity expanded from 96.5 million MT to 125.8 million MT, an increase of over 30%.^{Footnote 114} The country’s impressive growth in its steel sector is further encouraged by the Government of India in its National Steel Policy 2017. The National Steel Policy seeks to increase steel consumption in major segments such as infrastructure, automobiles and housing; seeks to increase per capita steel consumption to 160 kg by 2030 from the existing level of 60, and; aspires to achieve 300 million MT of steel-making capacity by 2030.^{Footnote 115} Given India’s increasing pace of steel production in the past few years, and its ambitious future goals, the country will soon surpass Japan to become the world’s second largest steel producer.

[157] India ranks as the world’s fourteenth largest exporter of steel products. In the first nine months of 2017 the country exported 11.8 million MT of steel valued at $US 7.8 billion. The exports in the first three quarters of 2017 represent a 68% increase in volume and a 75% increase in value over the country’s steel exports in the same period in 2016. Also in the first nine months of 2017, India’s steel exports as a share of production rose to 15.6% as compared to 9.9% in the same period in 2016. In terms of pipe and tube products, a product category that includes CSWP, India exported 1.1 million MT of these goods in the first nine months of 2017 (extrapolated to 1.5 million MT for full year 2016). During this time the US was ranked as India’s largest export market for pipe and tube products and Canada was ranked as fourth largest.^{Footnote 116}

[158] While the administrative record for the CBSA’s expiry review investigation does not contain definitive information as to the total production capacity of CSWP producers in India, the CBSA is nonetheless satisfied that there is significant CSWP production capacity in India. The Simdex Metal Tube Manufacturers Worldwide Guide identifies 53 companies that are capable of producing various carbon steel welded pipe products in India.^{Footnote 117} Based on the production capacities listed by Simdex as well as its own internet research, Nova estimates the total carbon steel welded pipe capacity in India to be in excess of 4.9 million MT.^{Footnote 118}

[159] However, CBSA research revealed that a number of the 53 companies identified by Simdex as being producers of carbon steel welded pipe are not. For example, three of the first four companies listed by Nova in its case brief do not produce carbon steel welded pipe at all; Apex Tube and Bhandari Foils and Tubes produce stainless steel pipes and tubes while Arcee Group produces PVC pipes.^{Footnote 119}

[160] Therefore, based on its research, the CBSA conservatively estimates that the total production capacity of all carbon steel welded pipe producers in India to be slightly in excess of four million metric tonnes. However, the CBSA also recognizes that this figure is made up of many carbon steel pipe products that fall outside of the product definition, such as structural tubing products as well as standard pipe and line pipe products with outside diameters greater than six inches. That being said, if the CBSA were to conservatively estimate India’s CSWP capacity to be only one-tenth of that amount, or 400,000 MT, this would still be greater than that of the total Canadian CSWP market.^{Footnote 120}

[161] Information on the record suggests that India exports steel to more than 200 countries and territories^{Footnote 121} and the country’s CSWP producers also export their product extensively. APL Apollo Tubes Limited, which claims to be the largest producer of electric resistance welded steel pipes and sections in India, states that it caters extensively to the region and exports to over 20 countries globally.^{Footnote 122} Asian Group of Companies states on its website that its ‘client footprint practically spans the entire globe covering continents of America, Europe, Africa, Asia and the Middle East.’^{Footnote 123} Manu International states on its website that it is an eminent manufacturer, supplier and exporter of a number of products, including pipe and tube products.^{Footnote 124} Surya Global Steel Ltd. states on its website that its state-of-the-art pipe making facility at Anjar is just 35 kilometres away from the port of Mundra, ‘thus giving it a strategic advantage of being a highly cost efficient option, to cater to the large export market.’^{Footnote 125}

[162] Based on information on the administrative record, exporters in India remained active in exporting subject goods to Canada during the POR of January 1, 2014 to September 30, 2017, despite the fact that subject goods from that country were subject to both anti-dumping duty and countervailing duty.^{Footnote 126} Exporters of CSWP from India have continued to show an interest in the Canadian market despite the goods being subject to anti-dumping duty and a countervailing duty rate of 3,577 rupees/MT for subject goods exported by Manu International, and 23,872 rupees/MT for all other exporters. Although no anti-dumping duty was assessed against imports of subject goods originating in or exported from India in 2014, 2015 and 2016, anti-dumping duty was assessed against subject imports in the first nine months of 2017.

[163] In addition to Canada having anti-dumping measures in place against CSWP from India, the US has had anti-dumping measures in place since 1986 against certain welded carbon steel pipes and tubes from India.^{Footnote 127} These measures were recently reaffirmed by the US ITC on January 4, 2018 when it decided to continue its anti-dumping and countervailing duty orders on circular welded pipe and tube from several countries including India.^{Footnote 128} Despite these measures being in place, the ITA notes in its December 2017 report that the US accounted for 37% of India’s pipe and tube exports (414,000 metric tonnes) in the first three quarters of 2017.^{Footnote 129} The fact that such a significant share of Indian pipe and tube products are destined to the US market and to the Canadian market (India’s fourth largest export market for these goods) signifies the great importance that producers in that country place in the North American market.

Determination Regarding Likelihood of Continued or Resumed Dumping for India

[164] Based on information on the record regarding the large number of carbon steel welded pipe producers in India and their potential production capacities; the imposition of anti dumping measures by the US in respect of goods of the same description from India; and the fact that exporters of CSWP from India have shown continued interest in the Canadian market during the POR despite the goods being subject to anti-dumping and countervailing duties, the CBSA determined that the expiry of the finding is likely to result in the continuation or resumption of dumping into Canada of certain carbon steel welded pipe originating in or exported from India.

[165] The CBSA did not receive any ERQ responses, case briefs, or reply submissions from exporters in Oman. The CBSA, therefore, relied on information submitted from participating parties, as well as other information on the administrative record, for the purposes of the expiry review investigation with respect to CSWP originating in or exported from Oman.

[166] Evidence on the record points to there being two potential producers of CSWP products in Oman. However, a closer examination of the information reveals that one of the companies, TMK Gulf International Pipe Industry, produces ERW pipe products with outside diameters greater than six inches,^{Footnote 130} which are not subject to the finding. The other company, Al Jazeera Steel Products Co. SAOG (Jazeera Steel), does produce the subject goods. The company’s 2016 Annual Report states that its tube mill division has a production capacity of 300,000 MT and produces the following products: black pipes, galvanized pipes and hollow sections.^{Footnote 131} It should be noted that, although there is only one company in Oman identified as producing CSWP, this company’s production capabilities is greater than the total subject and non-subject countries’ imports of CSWP into Canada during the POR.^{Footnote 132}

[167] Jazeera Steel notes in its annual report that 2016 was a challenging year with sluggish demand in Gulf Corporation Council countries on account of depressed oil prices and local governments showing prudence in spending.^{Footnote 133} A World Bank report in October 2017 concurs with this assessment, stating that protracted low oil prices and fiscal austerity continue to weigh on Oman’s economy.^{Footnote 134} According to the IMF’s World Economic Outlook report for October 2017, oil prices fell by 8.1% between February and August, even as OPEC and some non-OPEC oil exporters announced in May that they would extend oil production cuts through the first quarter of 2018.^{Footnote 135} Jazeera Steel states in its Annual Report that its tube mill volumes were affected by lower demand and increased competition. These factors may help account for the fact that the company’s sales of black pipes and galvanized pipes decreased slightly from 140,205 MT in 2015 to 138,101 MT in 2016.^{Footnote 136}

[168] According to Jazeera Steel’s website the company markets its products to countries across the globe, including North America, and “aims at being a leading tubing supplier in the world.”^{Footnote 137} Meanwhile, the company’s 2016 Annual Report states that “…we have diversified to other export markets in 2016 and hope to build on this in 2017.”^{Footnote 138} Based on these statements, it is evident that the company is determined to market its tubular products to export markets in hopes of becoming a world leader in these goods.

[169] Similar to carbon steel pipe products from Chinese Taipei and India being subject to anti-dumping measures in the US, Oman’s exports of circular welded carbon-quality steel pipe products are also subject to these same measures in the US. In its final determination of dumping issued on October 28, 2016, the US Department of Commerce established a dumping margin of 7.24% on exports of circular welded carbon-quality steel pipes from Jazeera Steel as well as for all other exporters in Oman.^{Footnote 139}

[170] Furthermore, Oman exporters of CSWP have stopped exporting to Canada during the POR indicating an inability to compete in the Canadian market at non-dumped prices.

Determination Regarding Likelihood of Continued or Resumed Dumping for Oman

[171] Based on information on the record regarding the sizable CSWP production capability in Oman; the indications of a slowing and adjusting domestic economy due to the softening of oil prices; the ambitious export goals set out by Jazeera Steel for its products; and the imposition of anti-dumping measures by the US in respect of goods of the same description (i.e., circular welded pipe) from Oman, the CBSA determined that the expiry of the finding is likely to result in the continuation or resumption of dumping into Canada of certain carbon steel welded pipe originating in or exported from Oman.

[172] The CBSA did not receive any ERQ responses, case briefs, or reply submissions from Korean exporters. The CBSA, therefore, relied on information submitted from participating parties, as well as other information on the administrative record, for the purposes of the expiry review investigation with respect to Korea.

[173] Due to the fact that no exporters or manufacturers provided information during the CBSA’s investigation, a margin of dumping of 54.2% was determined at the final determination in accordance with a ministerial specification.^{Footnote 140} In addition, no exporters or producers provided information in the subsequent re-investigation and as a result normal values are determined by advancing the export price of the goods by 54.2 % under the ministerial specification. Non-cooperation in both the CBSA’s original investigation and reinvestigation may indicate that Korean exporters are unable to compete in the Canadian market at non-dumped prices.

[174] During the POR, although imports of subject goods from Korea were minimal, anti-dumping duties were still assessed.^{Footnote 141} The limited amount of imports can be attributed to the high normal values that have been in effect during the POR. Nevertheless, the fact that duties were assessed indicates that the subject goods from Korea were dumped during the POR. Therefore, this suggests a likelihood that future exports to the Canadian market will be made at dumped prices in the absence of the CITT’s finding.

[175] The propensity of Korean exporters to dump CSWP into Canada is further demonstrated by the numerous anti-dumping measures imposed against Korean exports by Canada in respect of similar goods while the finding in respect of the goods has been in effect.

[176] As of May 22, 2018, the CBSA has anti-dumping measures in force for the following steel pipe products originating in or exported from Korea:^{Footnote 142}

• Carbon and Alloy Steel Line Pipe
• Hollow Structural Sections
• Oil Country Tubular Goods (OCTG)

[177] In addition to these measures, information on the record indicates that there have been at least 10 other measures in five jurisdictions other than Canada, on steel pipe products from Korea since 2002.^{Footnote 143}

[178] Furthermore, according to the ITA’s Steel Exports Report for Korea, as of December 2017, there are a total of 51 anti-dumping and/or countervailing measures currently in effect in various countries against steel mill products from Korea.^{Footnote 144}

[179] The number of anti-dumping measures in other jurisdictions against Korea steel pipe products over the last 16 years, as well as the CBSA’s own dumping determinations concerning steel pipe products, demonstrates a pattern by Korean exporters to continue to export these steel products at dumped prices.

[180] In the five-year review for the Circular Welded Pipe and Tube (CWP) investigation, the US ITC determined that the revocation of the anti-dumping duty order on CWP from Brazil, India, Korea, Mexico, Taiwan, Thailand, and Turkey would be likely to lead to continuation or recurrence of material injury to an industry in the US within a reasonably foreseeable time.^{Footnote 145}

[181] In the CWP decision, the ITC’s Global Steel Trade data indicated that Korea was the fourth-largest global exporter of CWP (behind China, Italy, and Turkey) each year from 2013 to 2016. In fact, between the years 2012 and 2016, Korean exports of CWP into the US market increased from 108,983 short tonnes to 143,341 short tonnes^{Footnote 146}, representing a 32% increase in only four years. Hence, Korean CWP exporters’ interest in the US market not only remained present but increased notwithstanding duties in place against Korean CWP.

[182] Korea’s interest in the North American tube and pipe market is further supported in an article published by the Metal Bulletin in November 2017. The article describes the rise of US steel imports being fueled by tube and pipe products posting large year-on-year gains.^{Footnote 147}

[183] The aforementioned supports the notion that CSWP exporters in Korea have well established distribution channels for steel products in North America and have a continued interest in the North American market despite the numerous anti-dumping measures imposed on them. For these reasons, as trade remedies continue in the US, Korean CSWP exporters are likely to seek other competitive markets such as Canada, should the CITT’s finding be rescinded.

Determination Regarding Likelihood of Continued or Resumed Dumping for Korea

[184] Based on evidence on the record regarding Korean exporters continuing to export subject goods to Canada at dumped prices during the POR; the imposition of anti-dumping measures by authorities of Canada in respect of similar goods while the finding in respect of the goods has been in effect; and the likelihood of Korean CSWP exporters to seek other competitive markets such as Canada as trade remedies continue in the US against Korean CSWP exporters, the CBSA determined that the expiry of the finding is likely to result in the continuation or resumption of dumping into Canada of certain carbon steel welded pipe originating in or exported from Korea.

[185] The CBSA did not receive any ERQ responses, case briefs or reply submissions from exporters of CSWP originating in or exported from Thailand. The CBSA, therefore, relied on information submitted from participating parties, as well as other information on the administrative record for the purposes of the expiry review investigation with respect to CSWP originating in or exported from Thailand.

[186] During the CBSA’s original investigation, two manufacturers/exporters, Pacific Pipe Company and Saha Thai Steel Pipe, cooperated and received normal values based on the information received and verified by the CBSA. It was determined that Pacific Pipe Company and Saha Thai Steel Pipe were both found to be dumping CSWP into the Canadian market and the margins of dumping were not insignificant.^{Footnote 148}

[187] In 2013, the CBSA concluded a reinvestigation to update normal values and export prices of CSWP originating in or exported from subject countries. Both participating exporters from Thailand received updated normal values in the reinvestigation.^{Footnote 149}

[188] During the POR, although imports of subject goods from Thailand were minimal in respect of the total Canadian market, anti-dumping duties were assessed on Thai imports.^{Footnote 150} The limited amount of imports may be attributed to exporters’ inability to compete in the Canadian market at non-dumped prices. Yet, the fact that duties were assessed demonstrates that the subject goods from Thailand were dumped during the POR and exporters continue to remain interested in the Canadian market for CSWP.

[189] As discussed above, exporters of CSWP from Thailand continued to dump CSWP into Canada during the POR. As such, there is a strong likelihood that future exports to the Canadian market will be made at dumped prices if the CITT’s finding were to be rescinded.

[190] The information on the record documents numerous anti-dumping measures put in place by authorities in other jurisdictions respecting pipe and tubular products from Thailand, including CSWP.^{Footnote 151} A list of these measures is provided in Table 4 below and is separated into two sections, measures specifically relating to CSWP, and measures pertaining to other pipe and tubular products.

Table 4
Anti-dumping Actions Imposed by Other Jurisdictions^{Footnote 152}

Country Imposing Anti-dumping Action	Description of Subject Goods
CSWP Products Originating in Thailand
United States	Certain Circular Welded Carbon steel Pipe
Other Pipe and Tubular Products Originating in Thailand
Australia	Hollow Structural Sections
Brazil	Seamed Tubes and Austenitic Stainless Steel*
European Union	Malleable Tube Fittings
Turkey	Tube or Pipe Fittings
United States	Carbon Steel Butt-Weld Pipe Fittings
United States	Welded Stainless Pressure Pipe

*Investigation initiated on April 24, 2017.

[191] In light of the measures in force listed above, data from UN Comtrade International Trade Statistics indicates that Thailand’s primary export markets for pipe products are the US, Australia and Indonesia.^{Footnote 153} Export volumes to these primary export markets are provided in table below.

Table 5
Thailand Exports in MT of HS 730630^{Footnote 154}

	2014	2015	2016
United States	44,116	46,830	59,016
Australia	14,668	14,179	24,352
Indonesia	5,076	2,774	3,019

[192] As of January 4, 2018, the US ITC determined that the revocation of the anti-dumping duty order with respect to certain CWP exported from Thailand into the US, would likely have an adverse impact on the domestic industry. Therefore, the US continues to impose its anti-dumping duties with respect to certain CWP from Thailand that has been in force since 1985.^{Footnote 155}

[193] Since August 20, 2015, the Australian Anti-dumping Commission has applied anti-dumping measures on hollow structural sections against Thai exporters with rates of duties ranging from 5.7% to 29.7%. It is important to note, exporters and manufacturers that were found to be dumping in Australia’s anti-dumping investigation include known CSWP producers, Saha Thai Steel Pipe Company^{Footnote 156}, Samchai Steel Industries Public Company Limited^{Footnote 157}, and Pacific Pipe Public Company Limited.^{Footnote 158Footnote 159}

[194] The volumes represented in the table above continue to increase despite anti-dumping duties in force against Thailand by the US and Australia. Thailand has a propensity to export various steel pipe products to certain countries notwithstanding measures against them. This indicates that their producers are able to withstand these duties and/or change production when necessary.

[195] The numerous measures currently in place by other jurisdictions demonstrates Thai exporters’ propensity to dump CSWP and other pipe and tubular products. Furthermore, the continued dumping which took place in Canada during the POR indicates that Thailand’s aggressive pricing behavior respecting the subject goods continues to persist in today’s markets. Should the current finding be rescinded, it appears reasonable to expect that Thai exporters would not only continue to dump CSWP into the Canadian market, but given the continuation of the US ITC’s anti-dumping orders on Thai CWP, the volume of dumped goods would likely be much higher than the volumes imported into Canada during the POR.

[196] In regards to Thailand’s domestic market conditions, according to a report by the Economic Intelligence Centre (EIC) of the Siam Commercial Bank Public Company Ltd., a rapid increase of steel pipe imports from China has had a significant impact on Thailand’s steel pipe industry as Chinese imports are gaining market share by undercutting prices of domestic Thai steel pipe. In 2014, the share of Chinese producers in the steel pipe import market increased by 40% from the previous year. This trend continued in 2015, increasing by 16% in the first six months in comparison to the same period in 2014.^{Footnote 160}

[197] Due to the heavy influx of Chinese steel pipe imports into Thailand’s domestic market, the Government of Thailand implemented anti-dumping measures against China for welded stainless steel pipe. The EIC expects that the anti-dumping measures imposed by Thailand against China will benefit domestic producers in the short term, but would eventually have to face price competition in the future.^{Footnote 161} Prior to the implementation of the anti-dumping measures in September 2015, products imported from China under the investigation grew 177% in the first half of 2015 from the same period the previous year.^{Footnote 162}

[198] Meanwhile, the CBSA’s import data during the POR indicates that there has been a steady increase of subject goods from Thailand since 2015. In 2016, imports from Thailand represented a 22% increase from the previous year. In the first nine months of 2017, imports increased further, representing a 106% increase compared to the full year imports of 2016.^{Footnote 163} This demonstrates that Thai steel pipe producers are looking to export markets in order to displace excess capacity due to the rapid increase of imports of cheaper Chinese steel pipe products into Thailand.

[199] With respect to production capacity in Thailand, Nova identified five firms believed to be producers of CSWP and estimated their production capacity to be 913,000 MT.^{Footnote 164} Nova submits that the data provided in their case brief is a conservative estimate and actual capacity of Thai CSWP producers may in fact be significantly higher since information regarding all companies is not publicly available.

[200] Although information regarding all companies is not publicly available, CBSA research has determined that Nova overstated production capacity for Able Industries by 59,000 MT^{Footnote 165} and potentially understated production capacity for Samchai Steel Industries by approximately 226,000 MT. Samchai Steel Industries 2016 annual report indicates that the company has two factories with a combined annual production of 376,000 tons.^{Footnote 166} If the CBSA were to conservatively estimate Thailand’s CSWP capacity based on the available information, the production capacity would still significantly exceed the total Canadian CSWP market.^{Footnote 167}

[201] According to ITA’s Steel Imports Report respecting Thailand, in the first nine months of 2017 imports of pipe and tube products reached 471,000 MT^{Footnote 168}. With tube and pipe imports representing 52% of the estimated capacity of the Thai CSWP industry, producers’ capacity utilization will be significantly impacted unless there are feasible foreign markets to export CSWP. In its 2016 annual report, Pacific Pipe, a producer of CSWP in Thailand, states that its company plans to expand its coverage to all over the world and to aggressively develop their product quality in order to be internationally recognized and accepted as a world class steel pipe manufacturer.^{Footnote 169}

Determination Regarding Likelihood of Continued or Resumed Dumping for Thailand

[202] Based on evidence on the record in respect of Thailand exporters continuing to export subject goods to Canada at dumped prices during the POR; the anti-dumping measures concerning Thai steel pipe and tubular products in other jurisdictions; the domestic market conditions and CSWP capacity in Thailand, the CBSA determined that the expiry of the finding is likely to result in the continuation or resumption of dumping into Canada of certain carbon steel welded pipe originating in or exported from Thailand.

[203] The CBSA did not receive any ERQ responses, case briefs or reply submissions from exporters of CSWP originating in or exported from the UAE. The CBSA, therefore, relied on information submitted from participating parties, as well as other information on the administrative record for the purposes of the expiry review investigation with respect to CSWP originating in or exported from the UAE. While goods exported from the UAE by Conares Metal Supply Ltd. were subject to the finding during the POR, due to their exclusion from the CITT’s finding, the goods did not form part of CBSA’s analysis.

[204] The issue surrounding excess capacity in the UAE was broached by Nova in their case brief as they estimated the production capacity of CSWP to be in excess of 1,981,000 MT.^{Footnote 170} Nova submitted that their estimate is likely conservative since information regarding all companies is not publicly available. In estimating the total capacity of CSWP production in the UAE, the complainant relied upon the data provided in the Simdex Metal Tube Manufacturers Worldwide Guide along with industry brochures and website information publicly available.

[205] According to the testimony before the US ITC by Mervyn D’Cunha, Financial Controller of the Universal group, the UAE is composed primarily of four producers of standard pipe: Universal, Ajmal Steel Tubes and Pipes Industries, Conares Metal Supply, and KD Industries.^{Footnote 171} Information on the administrative record provides estimates for three of the four primary producers in the UAE.

[206] As noted in Marvyn D’Cunha’s testimony, Universal Tube and Pipe Industries produces a wide range of standard and non-standard pipe including square and rectangular, line pipe, conduit, and OCTG, most of which is non-subject to the original finding.^{Footnote 172} Furthermore, data provided in the Simdex Metal Tube Manufacturers Worldwide Guide indicates that producers of CSWP in the UAE produce a large range of pipe products that do not meet the product definition in the original finding.^{Footnote 173}

[207] As noted above, it appears that many of the known producers of CSWP in the UAE produce a wide range of product lines outside the scope of the product definition in the original finding. Therefore, although the estimated CSWP capacity in the UAE alone is significantly higher than the total Canadian market, the production that competes with Canadian CSWP is believed to be lower.^{Footnote 174}

[208] In light of this, there continues to be a growing interest for UAE pipe producers to explore export markets in spite of Marvyn D’Cunha’s testimony stating that demand within the UAE is strong.^{Footnote 175} This growing propensity to export notwithstanding strong domestic market demand, indicates that UAE producers are dealing with excess capacity and have to look to the global export markets to maintain high levels of production.

[209] According to UN Comtrade Data, there has been a significant growth in the export market of pipe producers in the UAE since 2014, as seen in the table below.

Table 6
UAE Total Exports of HS Code 730630^{Footnote 176}

	2014	2015	2016
Exports (MT)	11,535	14,180	28,587

[210] The data provided above indicates that exports of pipe products from the UAE to the global market have increased year-on-year with an increase of 23% in 2015 and 102% in 2016. The recent hike in exports of pipe products is in spite of the testimony of Marvyn D’Cunha indicating that demand within the UAE is strong.^{Footnote 177}

[211] Information from UN Comtrade Data also indicates that exports of pipe and tube products from the UAE to one of its primary export markets, Saudi Arabia, has seen a considerable decrease since 2015. Exports of pipe and tube products from the UAE to Saudi Arabia has decreased from 5,752 MT in 2015 to 3,794 MT in 2016, representing a 34% decrease.^{Footnote 178}

[212] The World Construction Network states that economic growth in Saudi Arabia has slowed to 1.4% in 2016, far below the 4% average growth rate achieved in the past decade.^{Footnote 179} Many projects in Saudi Arabia, more specifically, large public transport infrastructure projects and commercial developments have stalled in 2016 due to the government’s ongoing initiative to diversify the economy away from oil as part of Vision 2030.^{Footnote 180} The slowing of the aforementioned projects and developments indicates that the demand for CSWP would also decrease, supporting the data from UN Comtrade of the recent decline of exports from the UAE to Saudi Arabia in 2016.

[213] The rapid increase of UAE exports of pipe and tube products to the global market demonstrates CSWP producers’ enthusiasm and interest in competing internationally. With the recent economic downturn of Saudi Arabia, one of the UAE’s primary pipe and tube export markets, it is reasonable that producers will begin to seek alternative markets such as Canada.

[214] Furthermore, UAE exporters of CSWP have been unable to compete at non-dumped prices and have either stopped exporting to Canada or have continued to export subject goods to Canada at dumped prices while the finding has been in place.^{Footnote 181}

[215] The volume of imports into Canada of CSWP during the POR initially indicated a continued interest in the Canadian market. Despite the imposition of anti-dumping duties, UAE exporters continued to sell below normal values or without specific normal values. Near the end of the POR, the imports of CSWP steadily declined as anti-dumping duties continued to be assessed.^{Footnote 182}

[216] The decline in imports during the POR demonstrates that UAE exporters remained interested in the Canadian marketplace for CSWP, but were unable to compete in the market while the finding has been in place. This indicates an inability to compete in the Canadian market at non-dumped prices.

[217] The propensity of UAE exporters to dump CSWP in Canada is further demonstrated by the similar anti-dumping measures imposed against them by the US. On October 24, 2016, the Department of Commerce announced its affirmative final determination in the anti-dumping investigation of imports of circular welded carbon-quality steel pipe from the UAE.^{Footnote 183}

[218] In the testimony of Mervyn D’Cunha before the US ITC, it is noted that US purchasers of CSWP have a strong preference for domestic product over imports because lead times are reduced due to proximity, and customers have access to technical services, warranty and product liability concerns. Due to these factors, domestic producers can command a price premium over imports.^{Footnote 184} Nevertheless, the US Department of Commerce (USDOC) imposed anti-dumping measures against the UAE in regards to circular welded carbon-quality steel pipe.^{Footnote 185}

Determination Regarding Likelihood of Continued or Resumed Dumping for the UAE

[219] Based on evidence on the record in respect of the UAE’s excess CSWP capacity; the propensity of CSWP producers in the UAE to export; the UAE exporters inability to compete at non-dumped prices in Canada resulting in either the stoppage of exports or the continuation of exports to Canada at dumped prices while the finding has been in place; and the imposition of anti-dumping measures by the US in respect of goods of the same description, the CBSA determined that the expiry of the finding is likely to result in the continuation or resumption of dumping into Canada of certain carbon steel welded pipe originating in or exported from the UAE (excluding goods exported from the UAE by Conares Metal Supply Ltd.).

Nova

[220] Nova states that CSWP producers in India benefit from substantial subsidies conferred by both the federal and sub-federal levels of government and that if the finding were to expire there is a strong likelihood that the subsidies would resume or continue. Nova points to a recent CBSA Statement of Reasons issued on December 22, 2015, concerning the final determination of subsidizing of certain hot-rolled plate from India. Nova stated that in that case the CBSA found that 55 subsidy programs were countervailable but because the Government of India (GOI) and exporters such as JSPL and SAIL did not furnish sufficient information, the CBSA had to determine an amount of subsidy under a ministerial specification. The CBSA calculated the amount of subsidy to be equal to 7,844 rupees per MT (approx. C$160 per MT), equal to about 20% of the export price of the goods.^{Footnote 186}

[221] Nova notes that the US Department of Commerce determined that countervailable subsidies were provided to Indian producers and exporters of welded stainless steel pressure pipe in 2016 and to producers and exporters of cold-drawn mechanical tubing of carbon and alloy steel in 2017. Nova submits that many of the subsidy programs in the US investigations are similar to those identified by the CBSA in its investigation.^{Footnote 187}

[222] Nova states that, although the GOI responded to the CBSA’s subsidy questionnaire in the current expiry review investigation, the responses do not address whether there have been changes to the subsidy programs since September 2014 that would affect access to the programs or the amounts of benefits available under the programs. With respect to Special Economic Zones (SEZ), Nova notes that the GOI provides background information and rules for approval into SEZs but does not address the specific programs applicable under the SEZs nor whether there have been changes to the programs. As the Indian Ministry of Commerce & Industry has outlined the same programs in regards to SEZs, Nova submits that the programs under the SEZ remain actionable subsidies.^{Footnote 188}

[223] With respect to Export Oriented Units (EOU), Nova notes that the GOI also did not provide any new information with regards to the programs under this category or their application to CSWP producers. As the Export Promotion Council for EOUs and SEZs continue to outline the same features of EOUs, Nova submits that these programs remain actionable subsidies.^{Footnote 189}

[224] Nova contends that benefits under the following grants continue to exist: Assistance to States for Developing Export Infrastructure and Allied Activities (ASIDE); Market Access Initiative (MAI) and Market Development Assistance (MDA) schemes; Towns of Export Excellence (TEE), and; Brand Promotion and Equality, Export Trading Houses, Focus Market Scheme and Focus Product Scheme. These are presented below.

[225] With respect to the ASIDE grant, Nova notes that, although the GOI indicates in its response to the ERQ that this program has been discontinued in the new Foreign Trade Policy of 2015-2020, the GOI Department of Commerce website provides a detailed outline of the scheme and its current availability. Nova also submits that the Industries Commissionerate of the Government of Gujarat indicates that this program is still in application. Based on the above, Nova concludes that the GOI has provided no substantive evidence in regards to changes to the ASIDE grant’s content or its availability to CSWP producers.^{Footnote 190}

[226] With respect to the MAI and MDA grants, Nova states that, while the GOI indicates that the MAI and the MDA are not contingent on export performance and that the benefit is not directly provided to the exporters, the GOI’s Ministry of Commerce and Industry specifically states that the MAI Scheme is an export promotion scheme envisaged to act as a catalyst to promote India’s export on a sustained basis.^{Footnote 191}

[227] Similarly, Nova refers to the Federation of Indian Export Organisations which describes the MDA scheme as assisting exporters for export promotion activities abroad. Nova contends that, even if the benefits of the above programs were not directly provided to the exporters, the programs would nonetheless qualify as an upstream subsidy that has been ‘passed-through’ to the exporters. Furthermore, Nova submits that the GOI has not indicated whether these programs have changed since September 1, 2014 and, therefore, they continue to be actionable subsidies.^{Footnote 192}

[228] With regards to the TEE program, Nova notes that, while the GOI states that no assistance is given to any specific industries directly under this program, the GOI has also not commented on whether any component of this program has changed since September 1, 2014. According to Nova, the program allows towns, which are identified for their potential growth in exports, to provide financial assistance under the MAI scheme to recognized associations. Nova also notes that, as per the Highlights of the Foreign Trade Policy 2015-2020 issued by the GOI, two additional towns were added to this program. Based on the reasons above and in the MAI scheme, Nova submits that this program also remains an actionable subsidy.^{Footnote 193}

[229] Nova notes that the GOI’s Highlights of the Foreign Trade Policy 2015-2020 states that the Merchandise Exports from India Scheme (MEIS) has replaced five different schemes of the earlier foreign trade policy (i.e., Focus Product Scheme, Market Linked Focus Product Scheme, Focus Market Scheme, Agri. Infrastructure Incentive Scrip, VKGUY). Nova argues that this does not mean the programs are discontinued; at present all five schemes have been merged into a single scheme, but there is no conditionality attached to the scrips under the scheme. The programs supported under this program include iron, steel, and base metal product. Based on this, Nova submits that the benefits under these programs continue to exist and constitute an actionable subsidy.^{Footnote 194}

[230] Nova makes note that Surya Roshni has received various government grants according to the company’s Annual Report 2016-2017.^{Footnote 195}

[231] Nova submits that the Reserve Bank of India continues to provide preferential loan programs and that the preferential lending rate is available to exporters for domestic and imported inputs of exported goods. As the GOI does not identify whether preferential loan programs have changed in the relevant period and whether such change would affect access by CSWP producers, Nova submits that these programs continue to be actionable.^{Footnote 196}

[232] Nova notes that, while the GOI provided a detailed description of the Export Promotion Capital Goods (EPCG) scheme in its response to the subsidy questionnaire including a statement that benefits availed under the EPCG scheme in its entirety are not countervailable, the GOI also concedes that the excess exemption or remission of duties and taxes accrued on an exported product constitutes a countervailable subsidy. Nova submits that the EPCG scheme allows for the import of certain capital goods at zero customs duty while capital goods imported under the EPCG scheme for physical exports are also exempt from all of the integrated tax and compensation cess (i.e., a tax or levy) leviable.^{Footnote 197}

[233] With respect to the Advance Authorisation (AA) scheme and the Duty Free Import Authorisation (DFIA) scheme, Nova again notes that, while the GOI submits that they are not countervailable, the GOI also admits that these schemes can constitute an export subsidy if they result in the exemption, remission, deferral or refund of indirect taxes or import charges in excess of the amount of such taxes or charges actually levied on inputs that are consumed in the production of the exported product. Nova points out that the GOI has provided no comment that this is not the case for CSWP producers. As the GOI’s Ministry of Commerce and Industry indicates that the AA scheme and DFIA scheme are still in effect, Nova submits that these programs remain actionable subsidies.^{Footnote 198}

[234] With respect to goods and services provided by the GOI at less than fair market value, Nova submits that the GOI continues to own Steel Authority of India Limited as well as National Mineral Development Corporation, the country’s largest producer of iron ore, and therefore, there have been no changes to the CBSA’s initial investigation in this regard.^{Footnote 199}

[235] Although the GOI argues that there is no element of specificity in subsidy programs provided by the State Government of Maharashtra (SGOM), Nova points out that the GOI outlines the subsidy programs provided by the SGOM as countervailable in its most recent notification to the WTO.^{Footnote 200}

[236] In its most recent notification to the WTO, the GOI has indicated several subsidy programs that are in force, according to Nova. Based on the above, Nova submits that there is a high likelihood of continued or resumed subsidization by the GOI if the finding were allowed to expire.^{Footnote 201}

Government of India

[237] In its response to the CBSA’s ERQ the Government of India (GOI) provided information regarding a broad range of programs that the CBSA identified as possibly conferring a benefit to exporters of CSWP in India, such as special economic zones, export oriented units, grants, preferential loan programs, etc.^{Footnote 202}

[238] The GOI states that, “With respect to programs under Special Economic Zone investigating authority should take into consideration that Special Economic Zones are deemed to be a foreign territory for the purposes of trade operations and duties and tariffs.” The GOI further states that duty free imports in SEZs cannot be disposed of in the Domestic Tariff Area without payment of applicable duty and that the GOI conducts regular inspections to ensure that SEZ units meet the obligations under the provision of the WTO Agreement on Subsidies and Countervailing Measures. The GOI provides information regarding the administrative structure of SEZs, the approval process for applicants, and general terms and conditions for companies conducting business in an SEZ. Specifically mentioned sections of the SEZ Act are as follows: Section 7, which prescribes the terms and conditions whereby goods that enter an SEZ may be exempt from the payment of taxes, duties or cess, and; Section 30, which prescribes that any goods removed from an SEZ to the Domestic Tariff Area shall be charged duty, including anti-dumping, countervailing, and safeguard duties, and specifies the applicable duty rate.^{Footnote 203}

[239] With respect to a number of identified programs falling under the heading ‘export oriented units’ (EOU), the GOI states that the underlining idea of the WTO is that a member should export goods and not duties. The GOI further states that, “These units are allowed to import or procure locally, without payment of duty, all types of goods including capital goods, raw materials, components, packing materials, consumables, spares and various other specified categories of equipment’s including material handling equipment’s in terms of the Article XVI of GATT, required for export production or in connection therewith. Therefore to assume if EOU has any additional benefits is preposterous and Export Oriented Units are not countervailable as per the provisions of Agreement on Subsidies and Countervailing Measures.”^{Footnote 204}

[240] The GOI, in its response to the Subsidy ERQ, provided a number of responses to the 11 programs identified by the CBSA as grants. With respect to the grant program identified as ‘Assistance to states for developing export infrastructure and allied activities’ (ASIDE), the GOI notes that the program has been discontinued in the new Foreign Trade Policy of 2015-2020. The objective of program was to establish a mechanism for involving the State Governments to participate in funding of infrastructure critical for growth of exports by providing export performance linked financial assistance to them. Funds under the program were disbursed only to state government / government agencies; there was no provision to provide financial assistance to private firms/companies and, accordingly, no assistance was provided to the producers of the product under consideration.^{Footnote 205}

[241] With respect to the Market Access Initiative (MAI) program, the GOI submits that it was established to facilitate exporters or potential exporters to access new markets or increase market share in the existing markets through activities promoted by respective export promotion organizations / trade promotion organizations/ national level institutions / research institutions / universities / laboratories, etc. The GOI states that the MAI program is not contingent upon export performance nor is there any definitive relation between exports made by an exporter and the assistance provided under this program. The GOI further states that, as it does not offer any financial benefit directly to the exporters under this program, the program cannot be countervailed under the WTO’s Agreement on Subsidies and Countervailing Measures (ASCM).^{Footnote 206}

[242] With respect to the Market Development Assistance (MDA) scheme, the GOI states that it was established to facilitate various measures aimed to stimulate and diversify India’s export trade through marketing activities of the eligible agencies i.e. the Exports Promotion Councils (EPCs), the Federation of Indian Export Organization (FIEO), etc. The GOI submits that the MDA scheme is not contingent on export performance nor is there any definitive relation between the activities supported by EPCs or FIEO and the volume of exports made by an exporter. The GOI further states that, as the government does not confer any benefit directly to the exporters under the MDA scheme, it is not countervailable under the ASCM.^{Footnote 207}

[243] With respect to the ‘Towns of Export Excellence’ program, the GOI states that no assistance is given to any specific industries directly under this program. The GOI further states that, as per Paragraph 1.35 of the FTP 2015-2020, the objective of this program is the development and growth of export production centres. This program provides the following:

1. Recognized associations of units will be provided financial assistance under MAI scheme, on priority basis, for export promotion projects for marketing, capacity building and technological services.
2. Common Service Providers in these areas shall be entitled for Authorisation under EPCG scheme.^{Footnote 208}

[244] The GOI states that, while the following programs were provided for in FTP 2009-15, they have been discontinued in the present FTP 2015-20 and, therefore, cannot be held countervailable in the present review: Brand Promotion and Quality, Test Houses, and Export and Trading Houses.^{Footnote 209}

[245] With respect to the Focus Market Scheme and the Focus Product Scheme, the GOI states the following:

[246] With respect to the program identified by the CBSA as ‘Meeting expenses for statutory compliances in buyer country for trade related matters,’ the GOI states that there is no such scheme. As for the ‘Research & development financial assistance’ grant program, the GOI states that this program has been discontinued in the present FTP 2015-20.^{Footnote 211}

[247] In terms of preferential loan programs categorized as ‘Pre-shipment, post-shipment and other preferential financing,’ the GOI notes that Pre-shipment and Post-Shipment Export Finance are short term loans sanctioned by banks to exporters for their working capital needs and are available for a maximum period of 360 days. According to the GOI, no benefit or financial contribution is granted to any person availing loan under this program by the GOI or any public body within the meaning of Article 1 of the ASCM in view of the deregulation of interest rates.

[248] Interest rates on advances have been deregulated since October 18, 1994, and these interest rates are determined by commercial banks with the approval of their boards. Effective July 1, 2010, banks are required to determine their actual lending rate on loans and advances with reference to the Base Rate and all categories of loans are priced only with reference to the Base Rate, which is announced by banks after seeking approval from their respective boards. Since the Base Rate is the minimum rate for all loans, banks are not permitted to resort to any lending below the Base Rate, including export credit advances. Under the earlier scheme in force up to June 30, 2010, banks could lend below the Benchmark Prime Lending Rate (BPLR).^{Footnote 212}

[249] In its response to the CBSA’s Subsidy ERQ, the GOI addresses a number of programs related to ‘Relief of Duties and Taxes on Materials and Machinery.’ In terms of the ‘Export Promotion Capital Goods (EPCG) scheme, the GOI notes that it allows for the import of capital goods for pre-production, production and post-production without payment of customs duty. The objective of the EPCG Scheme is to facilitate import of capital goods for producing quality goods and services to enhance India’s manufacturing competitiveness.^{Footnote 213}

[250] The GOI submits that the benefits availed under EPCG Scheme in its entirety is not countervailable within the meaning of the ASCM and that only the excess exemption or remission of duties and taxes accrued on an exported product constitutes a subsidy and is liable to be countervailed under the WTO subsidies framework.^{Footnote 214}

[251] The GOI explains what duties and taxes are exempted under the EPCG scheme, what capital goods qualify under the scheme, and the export obligations which must be fulfilled with respect to the scheme. The GOI submits that the countervailing duty (CVD), the special additional duty (SAD) and the cess waived on imports of capital goods under the EPCG Scheme does not confer a countervailable benefit on the recipient of the assistance provided by this program.^{Footnote 215}

[252] With respect to programs relating to the ‘Relief of Duties and Taxes on Materials and Machinery,’ the GOI submits that both the Advance Authorisation Scheme (AAS) and the Duty Free Import Authorisation (DFIA) scheme are not countervailable in terms of the WTO’s ASCM for the following reasons:

1. In Annex II of the ASCM it states that indirect tax rebate schemes and substitution drawback schemes can allow for the exemption, remission, deferral or refund of indirect taxes or import charges levied on inputs that are consumed in the production of the exported product.
2. Annex II also states that both indirect tax rebate schemes and substitution drawback schemes can constitute an export subsidy only to the extent that they result in exemption, remission, deferral or refund of indirect taxes or import charges in excess of the amount of such taxes or charges actually levied on inputs that are consumed in the production of the exported product. However, normal allowance for waste must be made in findings regarding consumption of inputs in the production of the exported product.
3. Furthermore, Annex II provides guidelines for an investigating authority to determine whether inputs are consumed in the production of the exported product; whether the government of the exporting country has in place and applies a system or procedure to confirm which inputs are consumed in the production of the exported product and in what amounts; and whether the claimed allowance for waste is ‘normal’ taking into account the production process, the average experience of the industry in the country of export, and other technical factors.
4. The GOI states that it has in place and applies a system to confirm which inputs are consumed in the production of the exported product and in what amounts, including a Norms Committee responsible for the formulation of Standard Input Output Norms (SION) and, therefore, the AAS & DFIA schemes are not countervailable as per the ASCM.^{Footnote 216}

[253] With respect to the ‘Duty Entitlement Pass Book’ (DEPB) scheme, the last program identified by the CBSA as falling under the heading ‘Relief of Duties and Taxes on Materials and Machinery,’ the GOI submits that this scheme has been discontinued as per Notification No. 51/2011 – Customs dated June 22, 2011.^{Footnote 217}

[254] With respect to the following three programs described in general in the Subsidy ERQ as ‘Goods/Services provided by GOI at Less Than Fair Market Value,’ the GOI states that, as no details are provided by the CBSA, the “GOI would reserve its rights to comment on the same”:

1. Purchase of hot-rolled steel from state-owned enterprises for less than fair market value
2. Provision of captive mining rights for minerals including iron ore and coal
3. Purchase of iron ore from state-owned enterprises for less than fair market value^{Footnote 218}

[255] Lastly, with respect to a number of potential subsidy programs provided by the State Government of Maharashtra, the GOI submits that, “. . . in order to encourage establishment of industries in lesser developed areas of the State, has been giving package of incentives to New Industrial Units / Expansion Units set up in the developing regions to ensure sustained growth through various initiatives and to obtain higher and sustainable economic growth with emphasis on balanced regional development and employment generation through greater private and public investment in industrial sector. Since the purpose of introducing the above schemes is to create employment and overall development of the region, such schemes cannot be considered to be countervailable. Therefore there is no element of Specificity as per the provision of Article 2 of the SCM.”^{Footnote 219}