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Ottawa, March 26, 2004
4366-16(JH)
AD1014
Concerning a determination under paragraph 76.03(7)(a) of the Special Import Measures Act regarding
CERTAIN CORROSION-RESISTANT STEEL SHEET PRODUCTS ORIGINATING IN OR EXPORTED FROM BRAZIL, THE FEDERAL REPUBLIC OF GERMANY, JAPAN, THE REPUBLIC OF KOREA AND THE UNITED STATES OF AMERICA
DECISION
On March 12, 2004, pursuant to paragraph 76.03(7)(a) of the Special Import Measures Act, the President of the Canada Border Services Agency determined that the expiry of the orders made by the Canadian International Trade Tribunal on July 28, 1999, in Review No. RR-98-007, continuing, with amendment, its findings made on July 29, 1994, in Inquiry No. NQ-93-007, concerning certain corrosion-resistant steel sheet products:
(1) is likely to result in the continuation or resumption of dumping of the goods originating in or exported from Brazil, the Federal Republic of Germany, Japan and the Republic of Korea; and
(2) is likely to result in the continuation or resumption of dumping of the goods originating in or exported from the United States of America.
Cet énoncé des motifs est également disponible en français.
TABLE OF CONTENTS
SUMMARY OF THE TRIBUNAL'S LAST REVIEW: # RR-98-007
INFORMATION USED BY THE PRESIDENT
- Parties arguing that continued or resumed dumping is likely
- Position of the Canadian Producers - Country Specific
- Parties arguing that continued or resumed dumping is unlikely
- World Excess Capacity
- China Factor
- Current Canadian Demand for Corrosion-Resistant Steel Sheet
- Brazil
- Germany
- Japan
- Korea
- United States
[1] On November 13, 2003, the Canadian International Trade Tribunal (Tribunal), pursuant to subsection 76.03(3) of the Special Import Measures Act (SIMA), initiated an expiry review of it orders made on July 28, 1999, in Review No. RR-98-007, continuing, with amendment, its findings made on July 29, 1994, in Inquiry No. NQ-93-007, concerning certain corrosion-resistant steel sheet products originating in or exported from Brazil, the Federal Republic of Germany, Japan, the Republic of Korea and the United States of America (the Named Countries). The purpose of the expiry review is to determine whether the orders should be continued or rescinded. The orders are scheduled to expire on July 27, 2004.
[2] As a result of the Tribunal's decision to initiate a review of its orders, the Commissioner of the Canada Customs and Revenue Agency (Commissioner) initiated an investigation on November 14, 2003, to determine whether the expiry of the orders is likely to result in the continuation or resumption of dumping of the goods into Canada.1
[3] On December 12, 2003, the responsibility for the customs program of the Canada Customs and Revenue Agency (CCRA) was transferred to the new Canada Border Services Agency (CBSA), created on the same date. All of the responsibilities of the former Commissioner of the CCRA with respect to the administration of SIMA were transferred to the President of the CBSA (President) on that date.
[4] On March 12, 2004, the President determined, pursuant to paragraph 76.03(7)(a) of SIMA, that the expiry of the orders was likely to result in the continuation or resumption of dumping of the goods originating in or exported from the Named Countries.
[5] The original anti-dumping investigation of certain corrosion-resistant steel sheet products, initiated on November 17, 1993, included the five Named Countries and six other countries (i.e., Australia, France, New Zealand, Spain, Sweden and the United Kingdom (U.K.)). A preliminary determination of dumping was issued, followed by a final determination of dumping on June 29, 1994. The Tribunal subsequently issued its findings of injury on July 29, 1994.
[6] On January 15, 1999, the Tribunal initiated a review of its findings, concerning certain corrosion-resistant steel sheet products originating in or exported from the 11 countries. On July 28, 1999, the Tribunal continued, with amendment, its findings concerning certain corrosion-resistant steel sheet products originating in or exported from the five Named Countries and rescinded its finding in respect of certain corrosion-resistant steel sheet products originating in or exported from Australia, France, New Zealand, Spain, Sweden and the U.K. Additional information regarding the Tribunal's review is provided in the following section "Summary of the Tribunal's Last Review: No. RR-98-007".
[7] On December 4, 2000, an anti-dumping investigation (administratively referred to as Corrosion-resistant Steel Sheet II) was initiated concerning certain corrosion-resistant steel sheet originating in or exported from the People's Republic of China (China), India, Malaysia, Portugal, the Russian Federation, South Africa and Chinese Taipei. On the same date, a subsidy investigation was initiated concerning certain corrosion-resistant steel sheet originating in or exported from India. At the preliminary determination stage, the investigation with respect to Portugal was terminated, as the volume of the dumped goods was negligible. On June 4, 2001, a final determination was issued that the margins of dumping were not insignificant for the other six countries and the amount of subsidy for India was not insignificant. On July 3, 2001, the Tribunal issued its findings of no injury.
[8] Subsequent to the Tribunal's review in 1999, the CBSA conducted three re-investigations to update normal values and export prices of certain corrosion-resistant steel sheet products. The most recent re-investigation conducted by the CBSA was concluded on June 23, 2003. The results of this re-investigation were made public in Customs Notice N-523 on July 10, 2003.2
SUMMARY OF THE TRIBUNAL'S LAST REVIEW: No. RR-98-007
[9] As mentioned above, the Tribunal rescinded its finding in respect of certain corrosion-resistant steel sheet products from six countries (i.e., Australia, France, New Zealand, Spain, Sweden and the U.K.), leaving the five Named Countries, which are the subject of this expiry review.3 The Tribunal's reasons for rescinding the finding are examined below.
[10] The Tribunal determined that Australia was not a major player in the Canadian market during the period to the original finding and was absent from the subject goods market in the review period leading to the 1999 review. In addition, there was only one anti-dumping measure in place concerning corrosion-resistant steel sheet goods against Australia by the United States (U.S.). However, a Canadian-based subsidiary of the only Australian producer of subject goods was sourcing small quantities of corrosion-resistant steel sheet from the Far East. For these reasons, the Tribunal rescinded the finding against Australia.
[11] Sollac Méditerranée S.A. (Sollac), the major producer of corrosion-resistant steel sheet in France, indicated to the Tribunal that its strategy was to concentrate on high-value products, international investments and profits. France did not ship subject goods into Canada during the Tribunal's period of review leading to the 1999 review and there was only one anti-dumping measure in place against France on corrosion-resistant carbon steel by the U.S. during which Sollac continued to ship small volumes of hot-dipped galvanized steel sheet into the U.S. Most importantly, in 1998, Sollac entered into a joint venture with Dofasco to develop a new galvanizing line in Canada. Do Sol Galva (DSG) line is owned by Sollac (20 percent) and Dofasco (80 percent). In the Tribunal's opinion, the evidence indicated that Sollac had no intention of jeopardizing its investment by resuming its dumping in Canada and thereby threaten the viability of its investment. In its domestic market, Sollac increased its production capacity and, at the same time, was operating at virtually full capacity to service its European Union (E.U.) markets.
[12] The Tribunal noted that New Zealand was not a major participant in the Canadian market prior to the original finding and remained out of the Canadian market during the Tribunal's 1996-98 period of review. New Zealand was included in a U.S. investigation concerning corrosion-resistant carbon steel flat products; however, it was not found to be materially injuring or threatening to materially injure the U.S. industry. In conclusion, the Tribunal found that there was insufficient evidence to conclude that New Zealand would be likely to resume dumping.
[13] Spain also had no shipments to Canada during the Tribunal's period of review, and there were no other findings in place against Spain concerning corrosion-resistant steel sheet. Evidence indicated that Spain had very few shipments outside the E.U. and focused mainly on its domestic market with consumption greater than production. This domestic market was strong, with a growing demand and increases in prices for corrosion-resistant steel sheet. There was new capacity brought on-stream, but it was destined for a pre-paint line. As a result, the Tribunal determined that the Spanish goods would not be sold at distressed prices and there was no likelihood of resumed dumping from Spain.
[14] As in the case of Australia and New Zealand, the Tribunal determined that Sweden was only a small participant in the Canadian market in the period leading to the original finding. Sweden remained out of the Canadian market in the period of review leading to the 1999 review. Sweden was also included in the U.S. investigation concerning corrosion-resistant carbon steel flat products but, like New Zealand, was not included in the finding. The Tribunal determined that Sweden was unlikely to participate in the Canadian market since it was a member of the E.U. and had access to that market instead. Consequently, the Tribunal found no likelihood of resumed dumping from Sweden and rescinded the finding against Sweden.
[15] With respect to the U.K., the Tribunal noted that there were no shipments into the Canadian market by British Steel, the only U.K. producer of the corrosion-resistant steel sheet, and there were no measures against U.K. corrosion-resistant steel sheet in place by any other country. In addition, 90 percent of British Steel's corrosion-resistant sheet was sold domestically or into the E.U. Despite pressure from imports in its domestic market, British Steel continued to ship small volumes of corrosion-resistant steel sheet into the U.S. Furthermore, British Steel had not added additional capacity and had no plans to add additional capacity. British Steel's marketing practices focused on matching supply and demand in its domestic market and maximized profits. Consequently, the Tribunal found no likelihood of resumed dumping from the U.K. and rescinded the finding against the U.K.
[16] The Tribunal's 1999 inquiry determined that continued or resumed dumping was likely concerning certain corrosion-resistant steel sheet products originating in or exported from Brazil, Germany, Japan, Korea and the U.S. The Tribunal gave the following reasons for its determination.
[17] In view of the instability of the Brazilian economy, the expectation for modest growth in the demand for corrosion-resistant steel sheet, industry's development of new production capacity and CSN's export marketing philosophy designed to maintain high utilization levels of production, the Tribunal found that there was a likelihood of resumed dumping from Brazil.
[18] While demand in the E.U. remained relatively healthy for corrosion-resistant steel sheet in 1998, the evidence suggested that growth would slow down in 1999 and 2000, as automotive production was expected to show little, if any, increase. The Tribunal noted the inventory build-up by the German producers and the decline in capacity utilization for corrosion-resistant steel sheet in the latter part of 1998. The evidence indicated the German producers planned to increase production capacity by up to 1.5 million metric tonnes (metric tonnes hereafter referred to as tonnes) over the next couple of years. Production from this new capacity would have to compete with substantial capacity increases planned by other E.U. producers. In the Tribunal's view, demand in the E.U. would not be sufficient to consume this new capacity and, therefore, the German mills would have had little choice but to step up their export sales efforts in order to maintain plant loading. For these reasons, the Tribunal found that there was a likelihood of resumed dumping from Germany.
[19] In view of the continuing weakness of the Japanese economy, the apparent export imperative of Japanese corrosion-resistant steel sheet producers and export selling prices at levels substantially below home market prices, the Tribunal found that there was a likelihood of resumed dumping from Japan.
[20] In view of the strong and growing reliance of the Korean producers on exporting in the face of depressed home market demand and in light of declining prices, excess production capacity and the addition of substantial new production capacity, the Tribunal was persuaded that there was a likelihood of resumed dumping from Korea.
[21] While U.S. demand had been strong, the evidence clearly indicated that prices for corrosion-resistant steel sheet weakened in 1998 and into 1999 due, in part, to an influx of imports from Asia. Further, the evidence suggested that prices in March 1999 fell sharply, by over six percent, and that the price declines for corrosion-resistant steel sheet exceeded price declines witnessed for both hot-rolled and cold-rolled steel. While growing imports contributed to declining prices, the evidence suggested that price pressures were exacerbated by substantial new capacity, which came on-stream in 1998. The Tribunal was persuaded that excess production capacity, particularly for construction grade sheet, would be available in the U.S. over the next few years. The evidence demonstrated that construction grade sheet is a commodity product, which is sold on the basis of the best available price. As noted, only nine U.S. mills submitted information in the 1999 review. Most of the remaining non-participants consist of steel service centres that generally purchase steel at spot prices. Given the proximity of the Canadian market and the expected excess supply of corrosion-resistant steel sheet in the U.S., the Tribunal had no doubt that dumping would resume by many of these suppliers, absent the finding.
[22] For these reasons, the Tribunal determined that there was a likelihood of resumed dumping of certain corrosion-resistant steel sheet products from the U.S.
[23] The goods subject to this expiry review are defined as:4
[24] flat-rolled steel sheet products of a thickness not exceeding 0.176 in. (4.47 mm), coated or plated with zinc or an alloy wherein zinc and iron are the predominant metals, excluding automotive exposed qualities designed for and used in the manufacture of outer body components for motor vehicles, originating in or exported from Brazil, the Federal Republic of Germany, Japan, the Republic of Korea and the United States of America, excluding:
(i) corrosion-resistant steel sheet products imported under tariff item No. 9959.00.00 for use in the manufacture of passenger automobiles, buses, trucks, ambulances or hearses, or chassis therefor, or parts, accessories or parts thereof;
(ii) cold-rolled steel coil which has been cleaned and electrogalvanized in accordance with ASTM Standard A591, the surface of which has been burnished with a system of 3-M Scotch-Brite rolls producing a polished or bright appearance, zinc weight both sides single spot 7.6-45.8 g/sq. m, known as Tribrite, and exported from the United States of America by Triumph Industries, A Division of The Triumph Group Operations, Inc.;
(iii) cold-rolled steel coil which has been cleaned and electrogalvanized in accordance with ASTM Standard A591, the surface of which may or may not be burnished and which has been roll-coated with a clear, continuous film composed of metal chromates and phosphates producing a clear, lacquered appearance, zinc weight both sides single spot 7.6-45.8 g/sq. m, and chromate coating 3-4 mg/sq. ft. each side, known as Triclear, and exported from the United States of America by Triumph Industries, A Division of The Triumph Group Operations, Inc.;
(iv) cold-rolled steel coil which has been cleaned and electrogalvanized in accordance with ASTM Standard A591, the surface of which is roll-coated with a continuous film composed of chromium chromates and oxides producing a green/gold appearance, zinc weight both sides single spot 7.6-45.8 g/sq. m, and chromate coating, as chrome, of approximately 30 mg/sq. ft., known as Trichrome, and exported from the United States of America by Triumph Industries, A Division of The Triumph Group Operations, Inc.;
(v) corrosion-resistant steel sheet products exported from the United States of America for painting or printing by Metal Koting Continuous Colour Coat Limited and re-exported from Canada, provided that title to such goods as imported, further processed and re-exported from Canada remains with the U.S. exporters, and provided that such goods are not sold in Canada, but are re-exported;
(vi) corrosion-resistant steel sheet products, with a zinc iron first coating applied either electrolytically or by a hot-dipped process and an iron rich flash coating imposed electrolytically, known as Durgrip-E or Durexcelite, and exported from Japan by Nippon Steel Corporation, for use in the manufacture of motor vehicles; and
(vii) corrosion-resistant steel sheet products, produced by the electrogalvanizing process, for use in the manufacture of motor vehicles.
[25] For purposes of clarity, goods which are not subject to the application of anti-dumping duty also include: steel sheet which is coated or plated with zinc in combination with nickel, silicon, or aluminium; galvanized product that has been pre-painted or coated with other finishes such as lacquers or varnishes; and galvanized armouring tape, which is narrow flat steel tape of 3 in. or less, that has been coated by a final operation with zinc by either the hot-dipped or electrogalvanizing process so that all surfaces, including the edges, are coated.
[26] The foregoing definition is referred to in short form as "certain corrosion-resistant steel sheet products" for purposes of this expiry review. In addition, "corrosion-resistant steel sheet" refers to a larger category of goods, which includes the subject goods and other coated steel products.
[27] Corrosion-resistant steel sheet is usually produced by one of two different coating processes: the hot dipped galvanized production process (referred to as HDG) and the electrogalvanized corrosion-resistant process (referred to as EZ). Corrosion-resistant steel sheet includes corrosion-resistant steel sheet in cut lengths and coils (wound successively in superimposed layers or in spirally oscillated coils) whether the coating or plating is applied by the HDG or EZ process.
[28] Corrosion-resistant steel sheet is usually produced from cold-rolled carbon steel sheet and, sometimes, from hot-rolled carbon steel sheet. However, minor additions of certain elements, such as titanium or boron, during the steel making process enable the steel to be classified as an alloy steel. Therefore, corrosion-resistant steel sheet produced from either carbon steel or alloy steel is considered to be subject to this review.5
[29] Corrosion-resistant steel sheet is commonly used in the production of certain motor vehicle components (such as inner body panels, exhaust systems and structural members), farm buildings, grain bins, culverts, garden sheds, roofing material, siding, floor decks, roof decks, wall studs, drywall corner beads, doors, door frames and ducting, and other heating and cooling applications, flashing, hardware products and appliance components. Electrogalvanized products are primarily used in automotive applications, but are also used in some construction applications.6
Automotive and Non-automotive End-uses
[30] The Tribunal's 1999 orders concerning certain corrosion-resistant steel sheet products included an amendment to exclude corrosion-resistant steel sheet products imported under tariff item No. 9959.00.00 for use in the manufacture of passenger automobiles, buses, trucks, ambulances or hearses, or chassis therefor, or parts or accessories thereof.
[31] The Tribunal noted that the corrosion-resistant steel sheet market was comprised of three sectors. The automotive end-use market purchased corrosion-resistant steel sheet through contracts that are usually based on a model year and the steel must be produced according to the specifications of the motor vehicle manufacturer. The second sector was the non-automotive end-user, including the construction industry, whereby purchases were made in the spot market and through short-term contracts. The third sector was comprised of service centres that generally made their purchases in the spot market for delivery in the near term. This corrosion-resistant steel sheet was generally a commodity product sold largely on the basis of price and as a result, reacted quickly to market pressures. The Tribunal maintained that the continuation of the finding for non-automotive purposes was necessary.
[32] The Tribunal excluded automotive end-use from the subject goods originating in or exported from the five Named Countries on the basis that the exclusion was not likely to cause the domestic producers injury since they were the supplier of choice to the automotive industry given the certification and the just-in-time requirements. These requirements would restrain the importation of automotive corrosion-resistant steel sheet from all subject countries other than the U.S. and the volume that could be exported from the U.S. would not be disruptive to the Canadian market.
[33] Certain corrosion-resistant steel sheet products are normally imported into Canada under the following Harmonized System Classification numbers:
7210.30.00.00 7212.30.00.00 7225.99.00.90
7210.49.00.00 7225.91.00.00 7226.93.00.00
7212.20.00.00 7225.92.00.00 7226.94.00.00
[34] The period of review (POR) for this expiry review was January 1, 2000 to September 30, 2003.
[35] The Canadian industry for certain corrosion-resistant steel sheet products is comprised of the following four companies:
Stelco Inc. (Stelco) of Hamilton, Ontario
Dofasco Inc. (Dofasco) of Hamilton, Ontario
Sorevco and Company, Limited (Sorevco) of Coteau-du-lac, Quebec
Continuous Colour Coat Limited (CCCL) of Rexdale, Ontario.
[36] CCCL is a small privately owned business that operates substantially as a toll coat processor with two coating lines. One line paints, prints and laminates steel while the other line is an electrogalvanizing line.7 CCCL did not produce certain corrosion-resistant steel sheet products during the POR.
[37] Stelco and Dofasco were the original complainants in the investigation that led to the findings, and Sorevco supported the complaint. Hereafter, these three companies are referred to collectively as Canadian producers.
[38] Stelco, incorporated in 1910 as the Steel Company of Canada, is one of Canada's largest steel producers. Stelco is an integrated steel company producing a wide range of steel products, including flat-rolled steel, bars and rods, as well as wire, wire products and pipes and tubes. Stelco currently produces corrosion-resistant steel sheet on three zinc-coating lines in its Hamilton facility. Two lines are conventional HDG lines while the third produces both HDG and galvanneal steel coils in a state-of-the-art coating facility (Z-line). The conventional lines make product up to 55 inches wide while the Z-line produces coils up to 72 inches wide.8
[39] Dofasco was founded in 1913 and is one of Canada's largest producers of flat-rolled steel. Products produced by Dofasco and its steel-related joint ventures include: hot-rolled steel sheets, cold rolled steel sheets, corrosion-resistant steel sheets, and Galvalume® steel sheets; prepainted steel; tinplate and chromium coated steels and ZyplexTM; welded tubular products; ExtragalTM for exposed automotive parts; and tailor-welded blanks. Dofasco operates a total of four coating lines at its Hamilton location. In addition, Dofasco is involved in a joint venture line in Windsor (DNN, now DJG), a joint venture line in Coteau-du-lac, Quebec (Sorevco) and a joint venture line in Hamilton (DSG). Dofasco produces a full range of carbon and high strength steels for the automotive, construction and general manufacturing industries.9
[40] Sorevco was incorporated in 1989 and is a joint venture between Dofasco and Ispat Sidbec Inc. Sorevco operates a HDG line at its facilities outside Montreal in Coteau-du-lac and is the only HDG facility in Quebec. The company runs independently with its own marketing and sales organization.10
[41] In 2000 and 2001, the apparent Canadian market was stable at just over 1 million tonnes of certain corrosion-resistant steel sheet products sold and the volume of imports from the Named Countries was in the 600 to 700 tonnes range.
[42] In 2002, Canadian producers produced and sold just over 1 million tonnes of certain corrosion-resistant steel sheet products and the total apparent Canadian market was 1.15 million tonnes. The Canadian producers represented approximately 88 percent of the apparent Canadian market. In the first nine months of 2003, imports of the subject goods from the Named Countries increased substantially compared to the same period in 2002.11 The details of the apparent Canadian market are presented in the table below:
Apparent Canadian Market12
Certain Corrosion-resistant Steel Sheet Products (Tonnes)
Table 1:
Source |
2000 |
2001 |
2002 |
Jan-Sep 2002 |
Jan-Sep 2003 |
Canadian Producers |
959,219 |
974,277 |
1,012,484 |
770,730 |
721,724 |
Named Countries * |
695 |
619 |
8,087 |
211 |
10,026 |
Other Countries |
119,446 |
54,303** |
129,232 |
103,483 |
78,999 |
Total Market |
1,079,360 |
1,029,199 |
1,149,803 |
874,424 |
810,749 |
* The data is net of re-exports.
** Year of the Corrosion-resistant Steel Sheet II investigation.
[43] Specific information for each Canadian producer and exporter cannot be shown, as it would disclose confidential information.
[44] Of the Named Countries, only Brazil and the U.S. shipped the subject goods to Canada during the POR.
[45] During the POR, a total of 17,200 tonnes of subject goods valued at $12.4 million were shipped from Brazil. Of the total shipped goods, 1,612 tonnes, or 9.4 percent of the goods, were dumped and anti-dumping duties were assessed in the amount of $41,000.13
[46] The total volume of subject goods imported from the U.S. during the POR was 129,137 tonnes at a value of nearly $49 million. However, 98.3 percent or 126,910 tonnes were re-exported after importation under the duty deferral programs.14 101,367 tonnes of the goods re-exported were secondary or off-prime goods, both of which are considered subject goods under the product definition, while 25,543 tonnes were prime subject goods.
[47] The volume of subject goods that was retained for consumption in Canada during the POR was 2,227 tonnes of prime subject goods. Of this volume, 42 percent or 938 tonnes of the goods were dumped and anti-dumping duties were assessed at $869,759.15
[48] With respect to the dumped shipments from the U.S., information was not provided in order to determine normal values and the shipments were therefore subject to the imposition of anti-dumping duties equivalent to a 155 percent advance over export price, pursuant to the Ministerial Specification under subsection 29(1) of SIMA.
[49] At the start of the expiry review, the Tribunal distributed a notice of the initiation of the expiry review and an expiry review schedule to interested persons including the Canadian producers, importers and exporters. At the same time, any person or government having an interest in the CBSA's investigation was invited to provide a submission containing information that they deemed relevant.
[50] Expiry review questionnaires (ERQs) were sent to the Canadian producers of certain corrosion-resistant steel sheet products, known exporters of the goods originating in or exported from the Named Countries, and known Canadian importers of the goods to request information necessary for the President to consider the factors listed in subsection 37.2(1) of the Special Import Measures Regulations (SIMR) to determine the likelihood of continued or resumed dumping. Interested persons were also invited to provide case arguments regarding the effect the expiry of the orders might have on the continuation or resumption of dumping of the goods. In addition, persons could submit reply submissions providing their comments in respect of the case arguments submitted by other persons.
[51] Three of the four producers (i.e., Stelco, Dofasco and Sorevco) fully participated in this review. In addition to participating in the expiry review and responding to the ERQ, the three Canadian producers provided case arguments and reply submissions supporting their position that the dumping of subject goods would continue or resume should the orders expire. CCCL provided a submission to the ERQ and did not participate further in this proceeding.
[52] Of the 54 exporters to whom ERQs were sent, only 6 six participated in the expiry review and were subsequently considered parties to the proceeding. The participating exporters were: Companhia Siderurgica Nacional (CSN) and Usinas Siderurgicas de Minas Gerais S.A. (USIMINAS) of Brazil; Thyssen Krupp Stahl AG (TKS) of Germany; and PRO-TEC Coating Company (PRO-TEC), United States Steel Corporation (USS) and International Steel Group (ISG) of the U.S.
[53] Of the Brazilian producers participating in this review, only CSN was named as an exporter of the subject goods in the CCRA's original investigation, which concluded on June 29, 1994. CSN opened a new facility in 2003, CSN-Parana, which is capable of producing certain corrosion-resistant steel sheet products. According to information gathered for this proceeding, CSN and USIMINAS account for a large portion of the total corrosion-resistant steel sheet production capacity in Brazil.16 Consequently, these two exporters represent a significant part of the corrosion-resistant steel sheet industry in Brazil.
[54] TKS was identified in the original investigation as a producer of the subject goods.17 TKS is also a minority owner (49 percent) in Galvasud, which is a Brazilian producer of corrosion-resistant steel sheet that did not participate in this review.18 TKS accounts for a large portion of the total corrosion-resistant steel sheet production capacity in Germany.19 TKS did not ship certain corrosion-resistant steel sheet products to Canada during the POR.20
[55] The U.S. mills participating in this expiry review account for a small portion of the total published U.S. capacity.21 USS, LTV Steel and Bethlehem Steel were identified in the original CCRA investigation. LTV Steel and Bethlehem Steel had their steel making assets absorbed by ISG as part of a major consolidation of steel making operations, which has taken place in the U.S. over the past year. Subject goods originating from U.S. mills participating in this expiry review were shipped to Canada during the POR. It should be noted that much of what was imported was subsequently re-exported to the U.S.
[56] The participating exporters answered the ERQ, each making representations that the export of the subject goods from their respective countries would not likely result in the continuation or resumption of dumping should the orders expire. All participating exporters also submitted case arguments and reply submissions in support of their positions.
[57] With regard to the participation of importers of the subject goods, a total of 20 ERQs were sent to importers. Letters and responses were received from 9 importers. None of the importers imported the subject goods during the POR. None of them participated further in the review; therefore, none of them were considered parties to the proceeding.
INFORMATION USED BY THE PRESIDENT
[58] The information used and considered by the President for purposes of this expiry review is contained on the administrative record. The administrative record includes the exhibits listed on the CBSA's Exhibit Listing, which is comprised of the Tribunal's administrative record at 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 is likely to continue or resume, absent the orders. This information may consist of expert analysts 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 Canadian producers, importers and exporters.
[59] For purposes of an expiry review, the CBSA sets a date after which no "new" information may be placed on the administrative record. This is referred to as the "closing of the record date". For this expiry review, the deadline for the closing of the administrative record was exceptionally extended by two working days to January 6, 2004, due to the closure of most offices for the Holiday Season. Accordingly, the deadline for receipt of case arguments was also extended by one day to January 13, 2004. This gave participants the maximum time available to prepare their case arguments and reply submissions based on the information that was on the administrative record as of the closing of the record date.
[60] Normally, the President does not consider any new information submitted by participants subsequent to the closing of the record date (i.e., January 6, 2004). However, in certain exceptional circumstances, it may be necessary to permit new information to be submitted. The President considers the following factors in deciding whether to accept new information submitted after the closing of the record date:
(a) the availability of the information prior to the closing of the record date;
(b) the emergence of new or unforeseen issues;
(c) the relevance and materiality of the information;
(d) the opportunity for other participants to respond to the new information; and
(e) whether the new information can reasonably be taken into consideration by the President in making the determination.
[61] Participants wishing to file new information after the closing of the record date, either separately or in case arguments or reply submissions, must identify this information so that the President can decide whether it will be included in the record for purposes of the determination.
[62] There were representations made by the participants with respect to new information submitted after the closing of the record date. On January 9, 2004, Grey, Clark, Shih and Associates, Ltd., counsel for CSN and USIMINAS, requested that two new documents be included on the record after the closing of the record date.22 The two documents were not accepted by the President for the purposes of the expiry review as it was determined that one of the reports was available before the closing of the record date and neither report related to new or unforeseen issues. Counsel was informed of the decision, which was made available to parties as part of the exhibit listing.
[63] On January 27, 2004, counsel again attached the same two documents along with two new documents to the Brazilian mills' reply submissions,23 but did not request that they be included in the record after the closing of the record date. Of the two new documents, one was denied on the basis that the information was not on the record before the closing of the record date and deemed as new information. With respect to the second document, only information concerning the galvanizing capacity of the plants was found to be on the record and was allowed. The remaining information was not on the record before the closing of the record date and was deemed as new information. The President has not accepted the new information for the purposes of the expiry review. In addition, statements in the reply submissions based on the new information were disregarded. Counsel was informed of the decision, which was made available to parties as part of the exhibit listing.
Parties arguing that continued or resumed dumping is likely
[64] The Canadian producers of subject goods, Stelco, Dofasco and Sorevco, presented arguments and evidence that dumping into Canada of certain corrosion-resistant steel sheet products from Brazil, Germany, Japan, Korea and the U.S. would continue or resume in the event of the expiry of the orders. The Canadian producers presented many common and individual arguments contending that continued or resumed dumping is likely.24
[65] Dofasco submitted that the Named Countries represented five of the eight largest steel producing countries in the world.25 Stelco submitted that, in 2001, flat-rolled sheet production in the Named Countries totalled 174 million tonnes, which accounts for 41 percent of world flat-rolled steel production.26 According to Dofasco, the tremendous magnitude of the subject goods capacity in the Named Countries indicates their ability to flood the Canadian market with dumped subject goods.
[66] Both Stelco and Sorevco submitted that Named Countries' corrosion-resistant steel sheet production capacity and underutilization is many times larger than total Canadian demand for the goods.
[67] The Canadian producers submitted that, given the excess supply of corrosion-resistant steel sheet in the world markets, there is a resultant increase in exports. They contended that the current overcapacity crisis will worsen in the short term as mills continue to increase their production and to add new capacity of steel products, including subject goods.
[68] Dofasco and Sorevco noted the dependency of producers in the Named Countries on exports to maintain their utilization rates. Dofasco and Sorevco argued that world exports of finished steel have risen from about 26 percent of total production to about 40 percent between the late 1980's and 200127 and all the Named Countries are also found in the top 20 steel exporting nations listing.28 Dofasco submitted that current low utilization rates in the Named Countries have resulted in substantial excess capacity available to supply the export market.
[69] With respect to the importance of the construction and automotive markets, Dofasco submitted that the same production facilities that produce subject goods in the Named Countries are also used to produce non-subject goods for sale to automotive customers. Dofasco contended that a weak domestic demand in the Named Countries for either the construction sector or the automotive sector will lead to increased exports.29
[70] Commenting on significant new production capacity for corrosion-resistant steel sheet, Dofasco and Stelco submitted that about 12.73 million tonnes of galvanizing production capacity will be added in the next 3 years in all industrialized regions of the world, including Brazil, China, South Korea and the U.S. Both producers also noted that the new capacity of corrosion-resistant steel sheet to be added in China over the next 3 years is 6.4 million tonnes.30 Both producers argued that exports of subject goods into the Chinese market will be displaced by its new production capacity as the producers in the Named Countries will then be forced to seek new markets.
[71] Stelco and Sorevco further noted that the anti-dumping measures in the U.S. on corrosion-resistant steel sheet restrict access to that market and would lead to the diversion of subject goods into Canada if the Canadian orders concerning these products are allowed to expire.
[72] Sorevco pointed out that the CBSA data on the record indicates that subject goods from the Named Countries were dumped in each of 2000, 2001, 2002 and January to September 2003,31 and during the same period, the dumping of certain corrosion-resistant steel sheet product imports from the Named Countries resulted in liability for anti-dumping duties exceeding $80 million.32
[73] Sorevco further submitted that the volume of subject goods imports from the Named Countries has declined significantly since the orders, which demonstrates an inability to compete without dumping. In addition, Dofasco and Sorevco submitted that the inability of producers in Germany, Japan and Korea to sell subject goods at undumped prices is strong and compelling evidence that dumping will continue or resume if the orders are allowed to expire.
[74] Dofasco submitted details concerning the weak demand for corrosion-resistant steel sheet in the Named Countries and provided details for each of the Named Countries.33 With respect to the weak state of the Canadian steel market, all three producers submitted that domestic spot selling prices have fallen over the course of 2003. Imports from non-subject countries are being sold on average at prices of $100 less than domestic selling prices.34 All three Canadian producers argued that due to the commodity nature of subject goods, producers in the Named Countries would only be able to compete in selling at dumped prices in Canada in the future.
[75] Sorevco referred to detailed evidence provided by the industry with respect to current low pricing of imported corrosion-resistant steel sheet from non-Named Countries such as Estonia, Finland and Portugal. Sorevco submitted that it is with these very low-priced imports that imports from the Named Countries must compete. Sorevco contended that if the orders were rescinded, imports from the Named Countries would be dumped in order to compete with the low-priced imports from the non-Named Countries.35
[76] Stelco submitted that the current world market for corrosion-resistant steel sheet remains weak and prices have not fully recovered from the market downturn in 2001-2002. Stelco submitted that, this was addressed by the Tribunal in the Steel Safeguards Inquiry:
...these developments linked with overcapacity and overproduction have had a global impact into the North American markets, placing pressure on U.S. producers as well.36
[77] Stelco noted that, at the time the Tribunal concluded there was no danger of serious injury since, in its view, in mid-2002, corrosion-resistant steel sheet markets were strengthening. Stelco argued that the Tribunal's prediction was not proven; rather, corrosion-resistant steel sheet markets continue to be impacted by substantial overcapacity, including overcapacity in the U.S. and in many other parts of the world; demand and prices for corrosion-resistant steel sheet have been depressed since mid-2002.37
[78] All three producers maintained that a strong Canadian distribution network is available to producers in the Named Countries and many steel traders engage source switching practices. Dofasco put forward the argument that steel traders used 14 different countries as sources for suppliers of low-priced imported corrosion-resistant steel sheet between 1996 and 2003.38
[79] In addition, all three producers maintained that the propensity of exporters in the Named Countries to dump exists, supported by numerous anti-dumping measures in force.
[80] Stelco and Sorevco maintained that the exporter information from cooperative producers in the Named Countries in this review represents only a fraction of total production and exports in the Named Countries. Sorevco further submitted that with incomplete evidence from Brazil, Germany and the U.S. and no evidence from any of the exporters in Japan and Korea, there is clearly insufficient evidence on the record to support a determination that dumping is not likely to occur.39
[81] According to Stelco, China's demand increases have simply added to the global problem of excess capacity in corrosion-resistant steel sheet. While demand is healthy in China, it assists exporters in Japan, South Korea and other Asian countries. However, even a small decline in Chinese demand will result in large volumes, once destined for China, having an impact on open markets in the world.40
[82] Dofasco and Stelco noted that the global oversupply in steel has resulted in high-level meetings by the Organization for Economic Co-operation and Development (OECD). A series of meetings of the Steel Committee's Capacity Working Group were held in 2003 to address this global problem and further meetings are planned in 2004. The stated objective of this group is to eliminate 127 million tonnes of inefficient capacity by 2005 out of an estimated 181 million tonnes of global capacity surplus.41
Position of the Canadian Producers - Country Specific
Brazil
[83] The Canadian producers submitted that Brazil's annual flat-rolled production of 10.6 million tonnes, which is slightly more than the Canadian annual flat-rolled production of a little more than 10 million tonnes as per an International Iron and Steel Institute (IISI) report from December 2002.42
[84] The Canadian producers refuted the Brazilian exporters' position that "because of the additional costs of production, corrosion-resistant steel sheet production is not subject to the `production imperative.'" 43 The Canadian producers stated that this imperative applies to flat-rolled steel in general and is even more relevant in the face of "excess capacity and weak local demand."44
[85] The Canadian producers noted that the two Brazilian exporters (CSN and USIMINAS) who have chosen to participate in this review constitute only a portion of the Brazilian industry for corrosion-resistant steel sheet. They further stated that the capacity of the non-participating mills is 1.21 million tonnes.45 The mills, which comprise this total, are Unigal, Galvasud and Vega do Sol. The Canadian producers allege that this capacity gives Brazil the "ability to flood the Canadian market with low-priced dumped subject goods".46
[86] The Canadian producers also identified the overall excess corrosion-resistant steel sheet capacity in Brazil and particularly, with respect to USIMINAS, whose present utilization rate reported by the company is, according to the Canadian producers, very low.47
[87] The Canadian producers refuted the claims of USIMINAS that since the end of the year 2000, its full capacity has been used. They also refuted USIMINAS' claim that the latter's present product mix is "much more geared to automotive products". In each instance, the Canadian producers stated that the evidence on the record indicates quite the opposite to these assertions.48
[88] The Canadian producers pointed to the Tribunal's previous acknowledgment of Brazil's "excess capacity given the weakness of demand and the likelihood of renewed dumping".49 They further asserted that the economic difficulties, which existed at the time of the Tribunal's comments, persist today.50 The Canadian producers also pointed to recent analysis, which suggests that prospective growth in the Brazilian market will be only modest.
[89] The Canadian producers also asserted that, contrary to representations made by CSN, CSN-Parana is fully operational and not in a pre-operational stage. As a consequence, the Canadian producers stated that utilization rates provided by CSN are erroneous, as they should account for the capacity of CSN-Parana at its fully operational level.51
[90] The Canadian producers further stated that while the Parana mill was built to produce galvalume product, significant amounts of corrosion-resistant steel sheet will be produced on the mill in 2004. The Canadian producers argued that, due to weak domestic demand in Brazil, it would be necessary to produce subject goods as part of this total corrosion-resistant steel sheet production to meet the projected capacity utilization rate forecasted by CSN.52
[91] The Canadian producers cited a CRU International report where the projected exports of coated sheet from Brazil are to increase significantly from 2002 to 2004. They further submitted that this projection constitutes evidence of the "increasing reliance of Brazilian producers of the subject on [sic] exports to maintain and increase their utilization rates".53
[92] Further to the issue of export dependency, the Canadian producers cited numerous sources, including a Metal Bulletin Research (MBR) Report article that identified the combination of the excess corrosion-resistant steel sheet capacity and recession in Brazil as the cause for the surge in exports of corrosion-resistant steel sheet. The article is also cited as stating that the additional production of corrosion-resistant steel sheet from the two new plants, which began production in 2003 (CSN-Parana and Vega do Sol), will require that even more of these products be exported.54
[93] Dofasco referred to a Reuters' article, Brazil steel industry boasts record 2003 output, as stating that Brazil's steel industry should "set a production record this year [2003] with an expected 5.3 percent increase on 2002 `mainly thanks to a rise in exports that offset an economic slowdown at home.'"55 A Portuguese News Digest article is further cited as estimating Brazilian exports of steel increased 14.2 percent in 2003 as compared with 2002.56
[94] In further alleging Brazil's export dependence for the subject goods, Stelco cited the Brazilian Steel Institute (BSI) as confirming that due to recession in Brazil, rolled steel exports rose 53.4 percent in January to October 2003 in comparison to the same period in 2002.57
[95] The Canadian producers asserted that CSN has conceded its export dependency in its own submission.58 The Canadian producers also cited specific figures in relation to both CSN and USIMINAS in support of their position that the Brazilian exporters are dependent on exports. Numerous sources were cited in support of the position that this dependency will continue to exist, especially given the new production capacity (i.e. Arcelor's Vega do Sol plant) and publicized future expansion plans in Brazil.59
[96] Dofasco highlights the fact that although USIMINAS' exports have increased substantially over last year, the substantial increase has not included exports to Canada at undumped prices.60 Dofasco also maintained that while CSN may have demonstrated an ability to ship at undumped prices at select periods during the POR, CSN has not been able to sell subject goods on a regular basis to Canada at undumped prices.61
[97] Furthermore, the Canadian producers asserted that shipments of subject goods by CSN are an indication of continued interest in the Canadian market and proof that the presence of the orders is efficient in maintaining a degree of "price discipline for the benefit of Canadian production".62
[98] The Canadian producers identified numerous anti-dumping measures presently in place against Brazilian steel products. These measures included four Canadian findings. The products concerned are Steel Plate (June 2000), Stainless Steel Round Bar (October 2000), Welded Pipe (July 2001) and Hot-Rolled Steel Sheet (August 2001).
[99] The Canadian producers also identified anti-dumping measures in Argentina, the E.U., Mexico and the U.S. for various Brazilian origin steel products as additional support to their position that Brazil has demonstrated a history of dumping.
[100] The Argentinean anti-dumping measures include: Hot-Rolled Steel Products (December 1999), Hot-Rolled Iron Sections (January 2002), Cold-Rolled Steel Products (March 2001) and Pipe Fittings (April 2003); the E.U.'s anti-dumping measures include Brazilian malleable cast iron tube or pipe fittings (June 2003); and the Mexico's anti-dumping measures include Brazilian Corrugated Rods (August 2000) and Type 1 Steel Beams (December 2002).63
[101] The products subject to the U.S. findings are: Hot-Rolled Carbon Steel Flat Products (July 1999), Carbon Steel Butt-Weld Pipe Fittings (January 2000), Circular Welded Non-Alloy Steel Pipe (August 2000), Carbon Steel Plate (December 2000), Seamless Pipe (July 2001), Carbon Steel Wire Rod (October 2002) and Concrete Steel Wire (December 2003).64
[102] The Canadian producers argued that trade remedies against other kinds of flat-rolled steel are not irrelevant to this review given that they are often related steel products which may have been "exported by the same mills as in this case, [and] are particularly relevant to renewed dumping".65
[103] The Canadian producers refuted the Brazilian exporters' position that there is no evidence on the record in respect of the current or future performance of the Brazilian producers that would support the continuation of the orders against Brazil. In supporting its position, the Canadian producers identified that Brazil is the eighth largest steel-producing country in the world and the tenth largest exporter of steel; has been export dependent and forecasted to be even more export dependent.66
Germany
[104] Dofasco made representations that Germany is the sixth largest steel producing country in the world. Three German producers of corrosion-resistant steel sheet were identified: TKS, Arcelor and Salzgitter AG.67 Stelco noted that TKS, part of the Thyssen Krupp Group, is one of the world's largest steel producers with total steel production reaching 16.4 million tonnes in 2002.68
[105] Dofasco submitted that Germany is the fourth largest steel exporting country (23.9 million tonnes) and the E.U. is a major exporter of flat rolled steel sheet with over 9 million tonnes in the first 8 months of 2003.69 Dofasco also submitted that E.U. exports will increase as a result of the "E.U. enlargement" on May 1, 2004. The E.U. enlargement will increase competition in the E.U. market and will result in the E.U. becoming a net steel exporter. Dofasco noted that TKS, the only cooperating German producer in the expiry review, exported significant quantities of certain corrosion-resistant steel sheet products in 2002, which represented approximately one third of its total certain corrosion-resistant steel sheet sales.70
[106] Dofasco noted that no export statistics were provided for the other two German producers. Applying the same export dependency as TKS, the two producers could potentially export one third of their combined production capacity of corrosion-resistant steel sheet.
[107] With respect to corrosion-resistant steel sheet, Dofasco and Stelco submitted that TKS' utilization rate fell between 2002 and the Q3 2003. With a significant capacity for producing subject goods, the unused capacity of TKS at the end of the Q3 2003 was substantial.71 Stelco noted that TKS' sales and profits decreased in the fiscal Q3 2003 period.
[108] Dofasco and Stelco noted that overcapacity in corrosion-resistant steel sheet is a certainty in Europe with the arrival of new corrosion-resistant steel sheet production capacity at Arcelor's facilities and the situation is expected to continue.72 Dofasco and Stelco also asserted that German producers would rely on exports to absorb their excess production.73
[109] In respect of the E.U., Dofasco noted that the European market demand for the subject goods, including Germany, is extremely weak. Germany's building activity (measured by reported construction orders) declined about 15 percent year on year, during the second quarter of 2003. During the same period, the German automotive sector, measured in unit production, declined 5 percent year on year.74 Dofasco also submitted that the E.U. is suffering from near-recession conditions for the automotive sector. Stelco further submitted that the steel situation in Western Europe is depressed in late 2003 and is forecasted to remain so into 2004 and that the German economy has been stagnant for 3 years and is only gradually expected to revive in 2004.75
Japan
[110] Dofasco and Stelco submitted that Japan is the second largest steel producing country in the world. Seven Japanese corrosion-resistant steel sheet producers were identified with a capacity of over 10 million tonnes.76 Dofasco noted that the Japanese producers exported over 5 million tonnes of coated sheet in 2003.77 Japan is the number one steel exporting country with 29.5 million tonnes of steel exported.
[111] Dofasco and Stelco submitted that, despite weak demand in the domestic market, Japanese production of corrosion-resistant steel sheet has been increasing in recent years. Stelco submitted that Japanese corrosion-resistant steel sheet production has been increasing at a rate substantially above its domestic consumption since 2002 and shipments of corrosion-resistant steel sheet by the Japanese producers to the domestic market have fallen dramatically over the last few years.
[112] In respect of export activity, Stelco and Dofasco noted the importance of the export markets to Japanese producers of subject goods and their need to export to maintain plant loading. Stelco cited that Japanese production of corrosion-resistant steel sheet has been steadily increasing. Japanese HDG production for the second quarter of 2002 exceeded domestic demand by 600,000 tonnes.78 Exports of corrosion-resistant steel sheet exceeded 4.3 million tonnes in 2002, which was an increase of over 1 million tonnes when compared to 2001. The level of exports of certain corrosion-resistant steel sheet products increased substantially in 2003.79 Dofasco submitted that Japanese coated steel products are being exported to all regions of the world, with substantial shipments to North America, including Canada.
[113] Dofasco submitted that Japanese producers are also selling the exported subject goods at dumped prices. Since the beginning of 2003, the Japanese producers have been selling exported subject goods for $100 per tonne below the Japanese domestic prices.80
[114] According to Dofasco, the utilization rate for the current Japanese producers is between 67.8 percent and 80 percent with excess corrosion-resistant steel sheet capacity of between 3.2 million and 5.8 million tonnes per year.81 The Japanese market for coated steel is currently characterized by low demand and high inventories. The automotive market remains weak and the construction market is forecasted to shrink in 2004.82 Stelco noted the stagnation of the Japanese economy in the 2002-2003 period.83
Korea
[115] Dofasco and Stelco submitted that South Korea is the fifth largest steel producing country in the world. Dofasco and Stelco identified five Korean producers of corrosion-resistant steel sheet possessing a total production capacity of 3.354 million tonnes. Posco was cited as the largest Korean steel producer with four HDG lines having a significant combined capacity.84
[116] Dofasco noted that South Korea is a major producer and exporter of subject goods. Dofasco cited that South Korea is the seventh largest steel exporting country (14 million tonnes) and South Korea's net implied exports of coated steel equalled 1.836 million tonnes in 200285 and increased a further 6 percent in 2003.86
[117] According to Stelco, production of HDG in South Korea has increased steadily and significantly since 2002, far beyond the growth in the domestic market. Dofasco further submitted that South Korean producers export to all regions of the world and many of the Korean producers have sales offices in most industrialized regions of the world, including North America.
[118] Stelco submitted that China is adding substantial corrosion-resistant steel sheet capacity in the next number of years. The concern is that this new capacity will displace current exports to that market, and even a small decline in Chinese demand will force excess corrosion-resistant steel sheet production to look for new markets.87 According to Dofasco and Stelco, South Korean producers are facing slumping demand and increased imports, especially from China.
[119] Furthermore, Stelco noted that steel supply in South Korea has been negatively impacted by disruptions to industrial activity caused by widespread strikes.88
United States
[120] The Canadian producers cited the Tribunal's previous expiry review that noted the importance of the spot market in Canada for construction grade corrosion-resistant steel sheet, which is a highly price-sensitive commodity product sold by steel service centres and traders under short-term contract.
[121] The Canadian producers provided the prices of imported corrosion-resistant steel sheet against which they competed.89 Dofasco and Stelco provided its declining selling prices to service centres90 to estimate likely future export prices from the Named Countries, including the U.S., should the orders expire. The Canadian producers submitted that these prices would be dumped because anti-dumping measures have prevented imports from the Named Countries from participating in the market at those prices. The Canadian producers argued that the U.S. producers would need to dump to compete against the lowest prices of imported product offered on the Canadian market.
[122] The Canadian producers noted that U.S. mills have a stated corporate policy of not differentiating between U.S. and Canadian customers for pricing purposes. The Canadian producers argued that evidence on the record indicated that U.S. mills have been operating at a loss and as a result, export prices equal to domestic prices, would probably be below cost and therefore be dumped.
[123] The Canadian producers noted the significant U.S. capacity of 25 million tonnes to produce corrosion-resistant steel sheet as compared to the relatively small Canadian market. They also noted that much of the capacity that had been idled in 2001-2002 has or will be restarted in 2003-2004. The Canadian producers estimated that significant excess production capacity existed in the U.S. because of weak demand in the U.S. home market and more import competition since the removal of U.S. safeguards (i.e. Section 201 action). The Canadian producers submitted that if the anti-dumping measures currently in place in respect of U.S.-made corrosion-resistant steel sheet expire, the U.S. producers would use their available excess capacity to increase production for resumed exports to Canada. The Canadian producers indicated that excess supply was the Tribunal's main reason for continuing the findings of likelihood of resumed dumping in its 1999 expiry review; they maintained that excess supply is still a factor in this expiry review.
[124] The Canadian producers further contended that the proximity of the U.S. to the Canadian market remains a concern. The Canadian producers noted that the over 100 U.S. steel service centres which ceased exporting the subject goods to Canada when the finding was issued, are poised to resume exporting to Canada if the orders expire.
[125] The Canadian producers pointed to the purchasing pattern by Canadian importers of subject goods. Canadian steel service centres and trading firms rapidly switched importing from countries subject to anti-dumping measures, to countries not attracting anti-dumping duties on their products. In the Canadian producers' view, this pattern of source switching, combined with the proximity of excess capacity in the U.S., suggests the likely resumption of export of subject goods to Canada.
[126] The Canadian producers noted that after the 1993 findings against the U.S. and ten other countries, Canadian importers switched to purchasing dumped certain corrosion-resistant steel sheet products from six other countries (China, India, Malaysia, Russia, South Africa and Chinese Taipei). The Corrosion-resistant Steel Sheet II investigation was initiated in 2000 against these countries, and importations of subject goods from these countries ceased, but quickly resumed after the Tribunal found no injury.
[127] With respect to other findings in place against the U.S., the Canadian producers submitted that the presence of anti-dumping measures in Mexico against U.S.-made corrugated steel rods, and in the E.U. and India against U.S.-made flat-rolled stainless steel, show that U.S. producers have a history of dumping steel.
[128] The Canadian producers noted that participating U.S. mills represent only a fraction of U.S. production, and that no vendors or service centers participated in this expiry review. In the original 1993 investigation concerning the subject goods, over 100 U.S. vendors were found to have been dumping. Canadian producers maintained that the minimal volume of imports since the original finding demonstrates an inability of U.S. producers and vendors to export to Canada at undumped prices. The Canadian producers pointed to the strong network of Canadian importers, which would provide ready channels of distribution for U.S. vendors should the orders expire.
Parties arguing that continued or resumed dumping is unlikely
[129] CCCL, the Canadian toll-coating operator, indicated in its response to the producer ERQ that it has no evidence that the exporters from the Named Countries have ever dumped goods into Canada. CCCL did not have evidence of new incentives or market strategies to dump the goods in the future.91
Brazil
[130] CSN and USIMINAS (hereafter "the Brazilian Mills") stated that recent additions to production capacity are "focused on production of non-subject corrosion-resistant steel."92 Consequently, the Brazilian Mills do not believe that this development would lead to injurious dumping in absence of the orders.
[131] CSN, for instance, asserted that its capacity utilization has improved regularly and it does not have any idle production capacity for coating certain corrosion-resistant steel sheet products.93 The Brazilian Mills stated that additional production capacity was introduced to meet "the future demand of a prosperous automotive industry and for pre-painted products, and consumer demand for Galvalume products, which, until recently, was fulfilled by imports". 94 The Brazilian Mills submitted that these products constitute "non-subject corrosion-resistant steel".95
[132] The Brazilian Mills also clarified the allegation by the Canadian producers that "a number of new mills, which are substantial exporters of the subject goods, have chosen not to participate in these proceedings".96 The Brazilian Mills stated that Unigal is actually part of USIMINAS and Galvasud produces 100 percent non-subject goods (automotive).
[133] The Brazilian Mills stated that the steel industry in Brazil is preparing for growth in the automotive industry. They also commented on the apparent investment strategy of Arcelor to establish a plant in Brazil, noting their joint-venture status with Dofasco in Canada. USIMINAS stated that it would not be logical for Arcelor's Brazilian plant to engage in selling to Canada, which would "disrupt their own investment in Canada".97
[134] CSN stated that the projected 3 percent growth in Brazilian GDP for 2004 is expected to translate into a 7 percent increase in demand for steel.98
[135] CSN also stated that the Canadian producers have provided figures, which do not focus on the subject goods and are hence, irrelevant to this expiry review.99 Furthermore, the Brazilian Mills asserted that the mere presence of excess capacity does not equate to a likelihood of dumping. The Brazilian Mills submitted that reported forecasts by Dofasco100 concerning exports of coated sheet from Brazil are incomplete because it "does not segregate subject from non-subject goods nor does it not [sic] present the assumptions, or methodology used to develop the estimates and forecasts".101
[136] Further to the issue of domestic growth, the Brazilian Mills argued that material referenced by the Canadian producers in support of the position that the domestic demand and economy in Brazil is weak, are dated sources, and hence, do not reflect "the recent upturn in economic activity and events in Brazil".102
[137] The Brazilian mills cited a December 2003 issue of the CRU Monitor to support the position that contrary to what the Canadian producers are suggesting, the prospects for steel prices in 2004 in Brazil are strong.103
[138] Furthermore, USIMINAS stated that there is no production imperative (which subsequently creates pressure to export for corrosion-resistant steel sheet as has been alleged by the Canadian producers). USIMINAS argued that:
Coating materials add value which must be recovered. Galvanizing lines can idle without any significant disruptions to the cost of operations and cold-rolled or other upstream products including semi-finished products (i.e. slabs) can be sold into the merchant markets for these products.104
[139] CSN also addressed the issue of duties assessed on subject imports over the POR. The company maintains that these duties arose:
...because CSN had billed each of the lines on the invoice at a single or average price. This led to sales at less than normal value for certain gauge items.105
[140] CSN expressed its concern that in the context of the expiry review, "simple notation that these were duties assessed does not give a proper picture".106 CSN also wished to highlight the vast majority of subject goods shipped from their facility, which were not dumped, in relation to the small proportion that the CBSA deemed were dumped. CSN stated that they have demonstrated the ability to compete at normal value through subject goods shipments during the POR.107
[141] USIMINAS stated that they have never shipped subject goods to Canada and although they participated in the last normal value review, they "have not had adequate product availability to ship to Canada".108
[142] The company further stated that this is not an indication that it has been unable to compete in Canada at undumped prices. Rather, USIMINAS makes reference to its Q3 2003 quarterly report, which states that USIMINAS is committed to "supplying the Brazilian market even when export opportunities were attractive".109 USIMINAS stated that their participation in normal value reviews was only to "maintain their ability to serve clients at normal value when opportunities or requests arise".110
[143] The Brazilian Mills also asserted that there are no anti-dumping measures in place "other than Canada in respect of goods of the same description or in respect of similar goods" and no other trade measures on Brazilian corrosion-resistant steel sheet in any other country outside of Canada.111
[144] In regards to similar goods, which may be subject to anti-dumping measures, USIMINAS stated that:
findings in respect of other flat-rolled products are of considerable irrelevance to corrosion-resistant steel sheet. The cost of coating the sheets is an important consideration and if there is not an adequate premium over the cold-rolled price, mills will not be inclined to employ their coating facilities which are not characterized by any production imperative, such as the Canadian Mills are inclined to suggest.112
[145] Similarly, the Brazilian Mills refuted the suggestion that trade restrictions in the U.S. will cause diversion of subject goods to Canada by affirming that Brazil is not subject to any such restrictions for corrosion-resistant steel sheet in the U.S. (or anywhere else but Canada), which would cause such a diversion.113
Germany
[146] Only one German producer, TKS, participated in this expiry review and provided arguments in support of its position that the resumption of dumping of certain corrosion-resistant steel sheet products into Canada is unlikely, should the orders expire.
[147] On the issue of production and capacity, TKS submitted that there is no excess capacity of corrosion-resistant steel sheet in Germany and the German producers have maintained a very high level of capacity utilization in recent years.114 TKS indicated that it started a new HDG production line in Dortmund at the end of 2001 in response to the increased demand in the automotive sector in Europe and no additional capacities are planned in the coming years.
[148] With respect to utilization rate and pricing, TKS submitted that the company maintained a high utilization rate during the period 2000 to 2002, and the utilization rate was increased to more than 90 percent in 2003.115 In the third quarter of 2003, TKS submitted that it decided to reduce the utilization rate in order to stabilize market prices. According to TKS, the resolution to maintain high prices and reduce production is reflected in the improved financial performance of the company.
[149] A report titled "CRU transaction price forecast" anticipated that German domestic market prices are expected to increase by more than 10 percent in 2004.116 TKS submitted that the expected price increase coupled with a strengthening euro against the dollar would result in a more concentrated focus by producers in the German domestic market. In addition, TKS indicated that it focused on high value-added products and its interest in the Canadian market is in the automotive sector.
[150] TKS submitted that over the POR, it was the only German exporter of non-subject corrosion-resistant steel sheet into the Canadian market and the average selling prices of non-subject corrosion-resistant steel sheet to Canada during the period 2000 to 2002 were higher than the German domestic prices.117 This demonstrates a propensity to maximize profits and not to sell for the sake of maintaining production.
[151] In regards to export orientation, TKS stated that the company had no intention to export subject goods to Canada or to North America. Its focus is on the domestic and E.U. markets. TKS further submitted that approximately 70 percent of German corrosion-resistant steel sheet production including TKS' was comprised of non-subject corrosion-resistant steel sheet.118 TKS indicated that its selling and marketing practices were similar to those of the other German corrosion-resistant steel sheet producers.
[152] In addressing the factors that led to the Tribunal's 1999 order to retain Germany as a subject country, TKS argued that the market conditions facing the German producers are completely different today.119 According to TKS, the current situation faced by the German producers is that the forecast for corrosion-resistant steel sheet demand in Western Europe shows an increase of 4.7 percent in 2004 and 6.8 percent in 2005.120 Imports into Germany have decreased in 2003 over 2002 levels.121 TKS submitted that imports into the E.U. from third countries (i.e., outside of the E.U. members) are also declining, while utilization rates have been high in the past several years. TKS further contended that the efforts have been made by the European producers including German mills to reduce supply through production restraint.
[153] In addressing the issue of inventories, TKS stated that there is no build-up of inventories to maintain production levels.122
[154] TKS further submitted that the domestic prices in Germany are higher than the U.S. import and U.S. domestic prices, and there are expectations of a continuing trend of increasing prices in Germany and declining prices in the U.S.123 TKS maintained that there is no need for German producers to export to North America in light of high utilization and better domestic prices.
[155] TKS stated that the Canadian producers have taken the opportunity to make a case for injury rather than a case for dumping. TKS also stated that the Canadian producers relied on outdated information in addressing the current market conditions in Germany and the world and made some incorrect and also unfounded allegations.124
[156] With respect to Sorevco's case arguments, TKS stated that the U.S. finding is the only other measure against Germany concerning corrosion-resistant steel sheet, besides the Canadian orders. Other measures against Germany such as steel wire by South Africa were not evidence of likelihood of resumed dumping by TKS.
[157] In response to Stelco's reply submission, TKS maintained that crude steel production could not be used as evidence of propensity to dump and that the magnitude of production and the capacity of flat-rolled production in Germany does not exist, as cited by the Canadian producers.125
[158] With respect to Dofasco's reply submission, TKS argued that shipments from Germany to E.U. members are considered home market sales rather than export sales. TKS further maintained that there was lack of evidence regarding the "bleak" market conditions referred to by Dofasco. Alternatively, TKS argued that the E.U. market for corrosion-resistant steel sheet is forecasted to increase.
Japan
[159] The Japanese exporters did not offer a response to the ERQ and there is no position available.
Korea
[160] The Korean exporters did not offer a response to the ERQ and there is no position available.
United States
[161] The participating U.S. producers of subject goods filed joint case arguments and reply submissions, and are referred to collectively as "U.S. Mills".
[162] U.S. Mills submitted that they have no propensity to dump because, operating in an integrated North American market, they do not differentiate between U.S. and Canadian customers for pricing purposes, and selling at the same ex-mill price is not dumping.126 Also, recalling the original 1993 anti-dumping investigation, U.S. Mills made the point that two major U.S. producers, National (now owned by USS) and Bethlehem (now owned by ISG) were found not to have dumped, while the other mills had low margins of dumping.
[163] U.S. Mills also submitted that the absence of anti-dumping complaints in the last ten years by Canada against U.S. steel producers indicated no history of continuous dumping of many products which might otherwise indicate a propensity of U.S. steel producers to dump. Rather, U.S. Mills stated that they have been responsible and not disruptive when exporting steel to Canada. They pointed to anti-dumping measures in Canada and Mexico against U.S. steel that have lapsed, including automotive-grade corrosion-resistant steel sheet, because of no likelihood of resumed injurious dumping.
[164] With respect to Canadian producers' representations, U.S. Mills refuted many arguments that combine all Named Countries without being country-specific, and U.S. Mills argued that the allegations no longer applied to the U.S. in isolation.
[165] U.S. Mills referred to the Canadian producers' list of anti-dumping measures in Canada and elsewhere against steel products from the Named Countries to support an argument that this large number indicates a propensity to dump. U.S. Mills noted that the cases cited do not identify any Canadian anti-dumping measures or include any U.S.-made corrosion-resistant steel sheet exported to other countries. Furthermore, U.S. Mills gave the details concerning the two U.S. origin steel products that were cited. Both cases were unrelated to the corrosion-resistant steel sheet industry. Stainless steel flat-rolled sheets exported to the E.U. is at the preliminary stage of the investigation, while corrugated rods exported to Mexico dates from 1990, have been renewed twice, and might be rescinded in 2004 on grounds of no likelihood of resumed injurious dumping. U.S. Mills rejected the notion that these two cases infer a propensity to dump by U.S. steel producers. U.S. Mills cited the expiry in 1999 by Mexico of anti-dumping measures against U.S. coated steel in support of their position that the U.S. is not a source of dumped steel.
[166] With respect to the Canadian producers' allegations that international trading firms have a history of switching dumped steel products from countries not, or no longer subject to anti-dumping measures, U.S. Mills argued that they do not sell to such traders as a rule and do not sell to Canada and in the U.S. at different prices.
[167] U.S. Mills cited the Canadian producers' argument that excess capacity in the Named Countries promotes exports and dumping. U.S. Mills countered by noting that this is speculative in respect of the U.S., as the information provided by the Canadian industry to support export-dependency of U.S. producers relates to all flat-rolled steel with no breakdown isolating corrosion-resistant steel sheet. Furthermore, data with respect to the U.S. exports of coated products does not support evidence of dumping. U.S. Mills stated that if the argument were true, there would be a broad range of U.S. steel dumped into Canada, of which there is not.
[168] With respect to the Canadian producers' arguments concerning increased imports of subject goods into Canada from the Named Countries, U.S. Mills contended that U.S. imports of subject goods were minimal and their average value was significantly higher than those from other countries, which indicated no dumping.
[169] U.S. Mills argued that there is no history of dumping to Canada because U.S. exports of subject goods to Canada in the POR were minimal when compared to the Canadian market.
[170] Concerning the argument that newly added capacity exercises pressure to export and dump, the U.S. Mills contended that this does not apply to the U.S. because there is no new capacity, only the restart of previously idled capacity at certain mills. U.S. Mills cited the Canadian producers' own statistics showing a decrease in U.S. domestic consumption with no corresponding increase in exports. In U.S. Mills' view, this indicates a focus on the domestic market and a responsible approach in the face of a weak domestic market by choosing not to export at any price.
[171] U.S. Mills suggested that the request by Dofasco to exclude the U.S. and Mexico from the proposed Tribunal safeguard remedy in 2002 is proof that the "Canadian steel industry does not consider the U.S. to be a source of unfairly-traded steel products".127
[172] Paragraph 76.03(7)(a) of SIMA requires the President to determine whether the expiry of a finding or order in respect of goods of a country or countries is likely to result in the continuation or resumption of dumping of the goods. Subsection 37.2(1) of the SIMR lists the factors that the President may consider in making a determination under paragraph 76.03(7)(a) of SIMA.
[173] Guided by the aforementioned factors in the SIMR and based on the documentation submitted by the various participants and the consideration of the information on the administrative record, the ensuing list represents a summary of the analysis:
- Global excess capacity and existing excess capacity in the Named Countries in addition to planned facilities and equipment expansions over the 2004 and 2005;
- Growth in demand of corrosion-resistant steel sheet (i.e. consumption trends) in the world and in the Named Countries;
- Present market conditions in Canada;
- Excess production and uncertain demand in the Named Countries causing pressure to export to maintain capacity utilization;
- The importations of subject goods at dumped prices from the Named Countries while the orders have been in place;
- Exporters' trade practices (i.e. history of dumping);
- Canadian importers' practice of source switching;
- Ability to produce the subject goods in facilities and equipment currently used to manufacture other goods;
- Trade measures taken by other countries; and
- Growth in export market opportunities (i.e. China and the E.U.).
[174] Before conducting a country-by-country analysis on the issue of the likelihood of continued or resumed dumping, there are issues that relate to the subject goods on a broader scale that need to be addressed. This will focus on the concerns of world excess capacity of corrosion-resistant steel sheet, the impact of China on the steel industry and the apparent demand for steel in Canada and abroad. Following this global analysis, specifics with respect to each of the Named Countries will be presented.
[175] CRU International's reported 2002 worldwide production for coated steel products (includes HDG and EZ goods, but not tin mill products) was 84.808 million tonnes.128
[176] Based on reports by CRU International and MB,129 the world production capacity for corrosion-resistant steel sheet is forecasted to increase by an additional 13 million tonnes over the next couple of years. Western Europe, Eastern Europe, East and South East Asia, the U.S., Latin American, India and the Middle East all have expansion plans for corrosion-resistant steel sheet production facilities over the 2004-2005 period.130 This includes plans for facilities in the Named Countries and other non-subject countries. Specific named country information concerning excess capacity of corrosion-resistant steel sheet will be addressed separately.
[177] In the period since the Tribunal's 1999 review concerning certain corrosion-resistant steel sheet products, China has emerged as a dynamic force in the world steel industry. With respect to crude steel production in 2002, China produced 182 million tonnes, versus 92 million tonnes in the U.S. and 16 million tonnes in Canada.131 China's apparent consumption of corrosion-resistant steel sheet in the first eight months of 2003 was 5.1 million tonnes, a 44 percent increase over the same period in 2002. Coated steel was the fastest growing steel segment in China.132
[178] According to China's Association of Iron and Steel, China's 2003 capacity to produce corrosion-resistant steel sheet was comprised of 63 lines capable of producing approximately 14 million tonnes of product.133 It is important to note that while the reported capacity figure for China is 14 million tonnes, CRU's data indicated that a total of 1.6 million tonnes were produced in China in the first three quarters of 2003. It is unknown why reported Chinese production is only a fraction of the stated country capacity for corrosion-resistant steel sheet, a product that is in high demand in the domestic market.134
[179] China presently is the world's fourth largest car producer with an estimated 3.9 million units produced in 2003. Most of these vehicles are destined for the domestic market. Vehicle sales were 2.1 million in 2001 and 4.2 million in 2003. Automotive production is expected to reach 7 million vehicles by 2008,135 and MB predicts that there will be continuing increased demand for automotive grade corrosion-resistant steel sheet.136
[180] Steel companies are responding to the predicted increased demand for corrosion-resistant steel sheet. TKS and Angang of China are forming a joint venture galvanizing line and associated blanking facility.137 China's Anshan Iron & Steel Group, through its subsidiary Angang New Steel, launched trial runs of one of its two existing 400,000 tonnes per year galvanizing lines in China. Commissioning of the second facility is scheduled for the end of 2003.138 Furthermore, Arcelor of France and Nippon of Japan have created a joint venture in China concerning two galvanizing lines for automotive end-use in China with an 800,000 tonnes capacity per year.139
[181] Corrosion-resistant steel sheet plant expansions in China were estimated to be almost 1.7 million tonnes in 2003, with a further predicted 2.5 million tonnes in 2004 and 2.2 million tonnes in 2005.140 The intended end use of this new capacity is not clear. However, even if all the new capacity is intended for the automotive sector, during the ramp-up stage of plants (typically 12 to 18 months), corrosion-resistant steel sheet not qualified to supply the automotive sector will be sold into the non-automotive sector. The ramp-up stage production was a concern of the Tribunal's in the 1999 expiry review.141
[182] The impact of Chinese steel demand on the world markets is so substantial that it has a ripple effect on international steel markets. In the first quarter of 2003, strong demand in China was generally regarded as helping to support North American steel price increases (in absence of demand) and driving up steel scrap prices. By the second quarter of 2003, imports and pricing into China had softened as steel stockpiles had increased.142 The third quarter of 2003 decrease in China's demand resulted in global softening in prices for hot-rolled coil. Recent increases in the Chinese import quotas (TRQ- tariff rate quotas) have driven up steel production in the neighbouring areas in Asia (Japan, Korea, Taiwan) thereby strengthening global steel pricing.143 However, as of December 26, 2003, the government of China eliminated the TRQ's and it is too early to tell what impact this will have.144
[183] Given these circumstances and the level of activity in the Chinese domestic market, the international steel community and analysts continue to voice concerns. Corus, a steel manufacturer of the U.K., indicated that any recovery in the steel industry is tied to the strength of demand from China. Corus indicated that if China produces more steel that it needs and begins exporting it, a recovery would be even further away.145
[184] In December 2003, LMN Group, the world's second largest privately owned steel company, indicated that while China's steel capacity has already increased by a third this year, with an increased annual consumption growth of 20 percent, China could become a significant exporter of steel. LMN Group has China as its biggest customer and it indicated that the steel industry is currently benefiting from China's surge in steel demand and, in the medium term, China also represents the greatest threat to the steel industry.146 Furthermore, industry analysts forecasted that the long-term outlook calls for significant swings in import level over the coming years as Chinese capacity struggles to keep up with demand.147
[185] While Chinese demand is benefiting Asian suppliers, recent reports indicate that Chinese customers are becoming increasingly price aware and are seeking out tertiary suppliers from outside the Asian market. This means that traditional Far East suppliers to the Chinese market have had their market share eroded by competitors outside the Far East such as Brazil.148
[186] The December 2003 MB Coated Steels Monthly noted that while the market is buoyant in China, it may become increasingly self-sufficient with respect to corrosion-resistant steel sheet and, large exporting nations such as Japan and India, will be seeking alternative export markets.149
[187] Presently, China has substantial corrosion-resistant steel sheet production capacity, along with new planned additions to capacity to come on-stream in the near future. It is unknown when China will have surplus corrosion-resistant steel sheet to export and will move from a net importer to a net exporter. In 2002, China consumed over 6.4 million tonnes of coated product150 and China's planned additions to its production capacity over the 2003 to 2005 period is estimated at over 6 million tonnes. China should begin to satisfy its domestic demand for corrosion-resistant steel sheet to a greater degree and exporters like Japan and Korea and other tertiary suppliers will be forced to quickly find new markets for the displaced steel to maintain their production volumes and propensity to export.
[188] It is important to note that over the POR, Chinese producers have shipped significant quantities of certain corrosion-resistant steel sheet products into the Canadian market.151
Current Canadian Demand for Corrosion-Resistant Steel Sheet
[189] Evidence on the record152 indicates that current demand for corrosion-resistant steel sheet in Canada is weak. Major causes include lower automotive output, a weak manufacturing sector and a flat non-residential construction market. There are signs of upward movement in the manufacturing market, but the automotive activity is expected to remain unchanged. Other evidence153 supports these findings of a weak Canadian steel market with high input costs, pricing weakness and continued flat demand.154 The outlook for key demand drivers, commercial construction, manufacturing activity and automotive demand remain weak. Currency movements are also cited as affecting U.S. and Canadian steel markets. The strong Canadian dollar is attracting imports to the Canadian market and depressing domestic spot prices.
[190] Two responses to the ERQ were received from CSN and USIMINAS. Both of these companies have participated in the CBSA's normal value and export price reviews during the POR and there are normal values currently in place for both companies. The two co-operating producers account for a large portion of Brazil's 2003 estimated production capacity of corrosion-resistant steel sheet.
[191] There are four companies that can produce the subject goods in Brazil: CSN (UPV and Parana), USIMINAS, Galvasud and Vega Do Sol. CSN indicated that Brazil has more than doubled its corrosion-resistant steel sheet making capacity since the year 2000.155 The evidence on the record indicates that Brazil may have as much as 2.64 million tonnes of such capacity.
[192] The evidence on the record indicates that there is excess capacity in Brazil in respect of corrosion-resistant steel sheet. While CSN (excluding CSN-Parana) may be producing very near full capacity, USIMINAS is producing at a high level of capacity utilization for corrosion-resistant steel sheet. Recent reports indicated Galvasud is running at about the same rate while Vega Do Sol is identified only as operating at less than full capacity.156 The Vega Do Sol and CSN-Parana facilities were put into production in July and August of 2003 respectively.157
[193] In addition to this extra corrosion-resistant steel sheet capacity, the Brazilian Steel Institute also recently announced that more additions to steel making capacity are planned in Brazil. It is expected that Brazil will boost its "installed production capacity to 40 million tonnes from 34 million tonnes now".158 How much of this capacity could be used for the production of certain corrosion-resistant steel sheet products is uncertain at this time.
[194] The evidence on the record does not support the Brazilian Mills' suggestion that additional corrosion-resistant steel sheet making capacity is destined for non-subject use. While the potential exists for production to be used in, for example, the Brazilian automotive sector, it is equally plausible that available capacity could be used to produce certain corrosion-resistant steel sheet products. In short, the evidence on the record does not indicate that production is geared for non-subject use.
[195] The Brazilian Mills have recently demonstrated a selling practice, which indicates that they are likely dumping quantities of certain corrosion-resistant steel sheet products into their export markets. For example, an analysis of the pricing data submitted by the Brazilian Mills in respect of certain corrosion-resistant steel sheet products shows that average export prices were either below the average prices in the domestic market or below average cost for most of 2002 and the first three quarters of 2003. In fact, the Brazilian Mills sold to each of their five largest export markets at average prices below their average domestic selling prices in Q2 and Q3 of 2003.
[196] More specifically, an analysis of the information submitted by CSN shows that the company sold certain corrosion-resistant steel sheet products below the average domestic price to its two export markets in Q1 of 2002, and that it sold to three of its largest export markets, including the largest, below their average cost of corrosion-resistant steel sheet in Q2 of 2002.
[197] In Q3 and Q4 of 2002, CSN sold certain corrosion-resistant steel sheet products to one of its largest export markets below the average domestic selling price. Furthermore, in Q1 of 2003, CSN sold certain corrosion-resistant steel sheet products to three of its five largest export markets at prices below the average domestic selling price, including its largest export market. In Q2 and Q3 of 2003, CSN proceeded to sell exports below its average domestic selling price to each of its five largest export markets.159
[198] The data submitted by USIMINAS indicates that the company sold certain corrosion-resistant steel sheet products to each of its five largest export markets at average selling prices, which were below the average cost in the first half of 2002. Over the same period, with the exception of the second largest market in Q2 of 2002, USIMINAS' sales of certain corrosion-resistant steel sheet products to each of its five largest export markets were below the average domestic selling price.
[199] In Q3 of 2002, while USIMINAS sold certain corrosion-resistant steel sheet products to each of its five largest export markets at prices above its average domestic price, it sold to three of those export markets, including the largest, at prices below average cost.
[200] In Q1 of 2003, USIMINAS sold certain corrosion-resistant steel sheet products to four of its five largest export markets at average prices that were below the average domestic selling price, including its largest export market. As previously alluded, USIMINAS also sold certain corrosion-resistant steel sheet products to each of its five largest export markets at average prices below the average domestic selling prices in the Q2 and Q3 of 2003.160
[201] The Brazilian Mills have not provided evidence, which would explain these price differentials. The disparity between selling prices is significant enough to suggest that corrosion-resistant steel sheet is frequently being sold to export markets below home market prices.
[202] In the 1999 expiry review of the subject goods, the Tribunal noted the following in respect of CSN's capacity utilization:
It was taken in evidence that CSN exports in order to utilize available production capacity that is not used to supply domestic demand.161 The record indicates that, in 1998, 12 percent of CSN's production of corrosion-resistant steel sheet was exported, up from 2 percent of production in 1997. The evidence also shows that virtually all the exports were commodity-type products destined for non-automotive end uses.162
[203] This analysis formed part of the Tribunal's basis for its decision to continue the anti-dumping measures in place with respect to Brazil for the subject goods. In the present context, the evidence on the record indicates that CSN, for example, is significantly more export dependent.163 A September 2003 publication of MBR also reported that:
With Vega Do Sol starting up in July followed by CSN-Parana in August, the market is becoming over-supplied... Full year output from Brazil is therefore likely to be in excess of 1.5 million tonnes. While all the projects were conceived to supply the domestic market, its current stagnation is forcing them to export, as well as operate below capacity levels... With the outlook relatively poor, an increased proportion of HDG sales to export markets are guaranteed, with the USA and Canada as a possible focus, but Asian shipments more likely, given the higher prices.164
[204] CSN's exports of certain corrosion-resistant steel sheet products increased by 505 percent in 2002 over 2001.165 USIMINAS' increase in respect of the same goods over the same period was 1081 percent.166 Furthermore, USIMINAS stated in its own ERQ response that it projects its exports of EZ and HDG products to increase in 2004 as compared to 2003, while its domestic sales of the same products are expected to decrease in 2004 in comparison with 2003.167
[205] The Brazilian Mills' contention that there is not a `production imperative' for the subject goods is also not supported by the evidence on the record. The Tribunal noted in its 1999 expiry review for the subject goods that CSN: "clearly indicated the importance of exports in maintaining high capacity utilization rates by the company".168 The Brazilian Mills have not demonstrated why the subject goods would be free from this production imperative, which is typically associated with other steel products. Given the capital investment involved to run galvanizing lines, there would be an apparent incentive (in the face of available capacity) to produce the subject goods in an attempt to maintain capacity utilization in order to recover those costs, even if the returns on the sold production do not recover the `full cost' of production.
[206] The Brazilian Mills stated that they expect the domestic market for corrosion-resistant steel sheet to improve considerably in 2004. A similar argument was raised by CSN at the Tribunal's 1999 expiry review where CSN stated that increases in capacity will "be absorbed by growing Brazilian demand" and further "that the domestic industry is prosperous".169 The evidence on the record barely supports this forecasted improvement in the domestic market. Projected improvements are based largely on generalities of the steel industry and speculations of the business cycle.170 Sources cited in support of growth in the domestic market rarely comment specifically on corrosion-resistant steel sheet nor do they provide substantive data, which would illustrate a domestic growth trend.171
[207] An October 2003 issue of the CRU Monitor projects that consumption of coated sheet in Brazil will actually be lower in 2004 than 2003 with a slight year on year increase for 2005.172
[208] Another recent publication offered caution to the suggested booming automotive sector and the economy in general where it stated: "higher car prices in the present economic situation in Brazil with falling incomes could mean lower sales and production which depresses the economy even further".173
[209] A more reasonable forecast would suggest marginal increases in demand are expected in Brazil at some point in 2004 for certain corrosion-resistant steel sheet products. The evidence on the record does not, however, support the position that domestic market trends in Brazil are significantly diverting the focus from exports towards the domestic demand.
[210] The evidence on the record indicates that Brazilian producers will continue to rely heavily on export markets for sales of certain corrosion-resistant steel sheet products. The recent conduct of Brazil in respect of its enormous surge in certain corrosion-resistant steel sheet products exports in 2003 and the prevailing struggles of the domestic economy support this position. Even a material recovery in the domestic economy could not reasonably be seen as sufficient to curtail this reliance on exports, given the present ratio of exports to domestic sales and the additions to capacity for corrosion-resistant steel sheet in Brazil.
[211] All Brazilian exports of certain corrosion-resistant steel sheet products to Canada during the POR occurred over a short period.174 Given the export dependency and interest CSN has demonstrated in the Canadian market for certain corrosion-resistant steel sheet products and the significant portion of that market presently occupied by imports from other countries, the absence of the orders would facilitate the opportunity for CSN and other countries to engage in more competitive pricing (i.e. likely dumped prices) in the Canadian market to obtain a greater portion of that market share.
[212] USIMINAS, while participating in normal value reviews, has not demonstrated an ability to compete at normal value. They have, in fact, made no shipments to Canada during the POR. Their participation in normal value reviews is, however, indicative of an interest in the Canadian market. The evidence on the record does not support USIMINAS' contention that they have not had available product to ship. This is in light of the available capacity USIMINAS has continually maintained in comparison to the apparent Canadian market of 1.15 million tonnes. The absence of the orders would allow USIMINAS to price more competitively and meet the competitive price point offered by non-subject countries, at likely dumped prices.
[213] CSN has not demonstrated a consistent ability to compete in the Canadian market at undumped prices. The other Brazilian producers, which comprise a vast proportion of the corrosion-resistant steel sheet making capacity in Brazil, have also not demonstrated an ability to sell subject goods in Canada at undumped prices.
[214] The evidence on the record indicates that no anti-dumping measures exist in respect of Brazilian corrosion-resistant steel sheet in any country other than Canada. There are, however, numerous anti-dumping measures, (i.e. hot and cold-rolled steel sheet) in respect of other Brazilian origin steel products in both Canada and abroad indicating a propensity by the Brazilian producers to sell steel into their export markets at prices below cost.
[215] Based on existing and forecasted excess capacity of corrosion-resistant steel sheet, the continuing pressure to export to maintain high capacity utilization rates in light of insufficient domestic demand, the overall lack of a demonstrated ability to compete in Canada at undumped prices, the recent behaviour of the Brazilian producers which suggests they have been selling the subject goods into their export markets at prices below home market prices or below cost, and the continuing instability of the Brazilian economy, the President determined that the expiry of the orders is likely to result in the continuation and resumption of dumping into Canada of certain corrosion-resistant steel sheet products originating in or exported from Brazil.
[216] Only one response to the ERQ was received from TKS, the largest German producer of corrosion-resistant steel sheet. No German producers participated in the CBSA's normal value and export price reviews during the POR. There are no current normal values in place and there were no importations of subject goods from Germany during the POR. Germany was a net exporter of corrosion-resistant steel sheet in 2002 and 2003.175
[217] Four German producers of corrosion-resistant steel sheet participated in the 1999 Tribunal expiry review.176
[218] During the POR, TKS was the only German producer that maintained a presence in the Canadian and U.S. markets. TKS shipped large quantities of non-subject corrosion-resistant steel sheet to Canada and the U.S. during the POR.177 In addition, TKS' shipments to Canada of non-subject corrosion-resistant steel sheet products more than doubled during the first three quarters of 2003 compared to the same period in 2002,178 which indicates a continued presence and interest in the Canadian market.
[219] Currently there are three German producers of corrosion-resistant steel sheet, namely TKS, Arcelor and Salzgitter AG. In 2002, the total corrosion-resistant steel sheet capacity of German producers reached 8.795 million tonnes. TKS accounted for a large portion of this capacity.179
[220] In 2002, the total actual German corrosion-resistant steel sheet production was 7.459 million tonnes.180 The utilization rate for German corrosion-resistant steel sheet producers in 2002 was about 85 percent. The unrealized German excess capacity was 1.336 million tonnes, which is significant when compared to the apparent Canadian market of 1.15 million tonnes. With respect to TKS itself, excess capacities of corrosion-resistant steel sheet also existed in 2002 and the first three quarters of 2003.181
[221] Evidence on the record indicates that there is an overcapacity of corrosion-resistant steel sheet in Europe.182 Planned additions to Western Europe's production capacity for corrosion-resistant steel sheet in the next three years are over 1.6 million tonnes.183
[222] TKS added a new HDG production line in Dortmund at the end of 2001 in response to the increased demand in the automotive sector in Europe. No additional capacities are planned in the coming years for both TKS and other German producers.
[223] Over the POR, German producers of corrosion-resistant steel sheet increased their production by 16 percent and German apparent domestic consumption for corrosion-resistant steel sheet was quite stable. The apparent domestic consumption rate declined from 105 percent in 2000 and 2001 to 93 percent in 2002 and to 86 percent in 2003.184 In 2000 and 2001, German net imports of corrosion-resistant steel sheet were approximately 300,000 tonnes each year. In 2002, Germany moved to being a net exporter of corrosion-resistant steel sheet, with net exports volumes of approximately 500,000 tonnes in 2002, increasing to almost 800,000 tonnes for the first three quarters of 2003, indicating a growing export dependency by the German corrosion-resistant steel sheet producers.
[224] In 2001, German producers, including TKS, exported approximately 40 percent of their corrosion-resistant steel sheet to export markets including the E.U. and third countries. Shipments into the export markets increased to 45 percent in 2002 and 46 percent during January-September 2003, indicating an export dependency that is expected to continue.185
[225] In 2002, the average German domestic HDG selling price was $349U.S./tonne and $461U.S./tonne in 2003,186 an increase of 32 percent. In addition, with input costs rising significantly, E.U. producers are under increasing pressure to raise prices. The announcement of price increase for January-March 2004 deliveries is necessary to offset the rising input costs.187 One article provided by TKS confirms that European steel producers will increase prices of flat rolled sheet for the first quarter of 2004 due to higher production costs.188
[226] On average, selling prices of certain corrosion-resistant steel sheet products by TKS into the export markets were higher than its domestic selling prices. However, evidence on the record indicated that TKS has sold the non-subject corrosion-resistant steel sheet into their export markets at prices below its domestic market prices during the first three quarters of 2003.189
[227] The U.S. found injury with respect to the dumping of corrosion-resistant carbon steel flat products from Germany in 1993 and the U.S. anti-dumping measures continues to be in place.190 The U.S. also has two other anti-dumping measures in place concerning carbon steel plate and seamless pipe from Germany.
[228] Canada currently has another anti-dumping measure in place with respect to stainless steel bars from Germany.191 Numerous anti-dumping measures in place with respect to German steel producers demonstrate a propensity of dumping steel products by German producers.
[229] With respect to market trends, the Canadian producers and the German producer present conflicting information regarding the demand for corrosion-resistant steel sheet in Germany and the E.U. in the coming years. However, there is ample information on the record indicating that the European markets including the German market for corrosion-resistant steel sheet is expected to remain weak in the short to medium term. The export oriented192 German corrosion-resistant steel sheet producers have to rely on export markets to maintain production levels.
[230] The economic growth in the E.U. was below 1 percent in 2002, and in Germany the figure was only 0.4 percent.193 According to the statement made by the President of the German Steel Federation in November 2003, the German economy has been stagnant for three years and is only gradually expected to revive in 2004.194
[231] The construction industry, the key consuming sector for certain corrosion-resistant steel sheet products, remains weak in Germany, and forecasts indicate that the industry will reach the bottom of the recession in 2004.195 The conditions of the construction industry in the E.U. were described as "anaemic" according to Arcelor, the largest coated steel producer in the world.196
[232] Based on significant excess production capacity for corrosion-resistant steel sheet, a weak demand in Germany and the E.U., the need to export to justify production volumes, present anti-dumping measures in place with respect to Germany in effect abroad, and the apparent inability to compete in Canada at undumped prices with respect to the subject goods, the President determined that the expiry of the orders is likely to result in the resumption of dumping into Canada of certain corrosion-resistant steel sheet products originating in or exported from Germany.
[233] There were no responses to the ERQ from producers in Japan. There is no history of Japanese producers participating in normal value reviews with respect to the findings and orders, and there are no current normal values in place for subject goods from Japan. There were no importations of subject goods from Japan. However, there were imports of non-subject corrosion-resistant steel sheet, hot-rolled and cold-rolled steel products from Japan during the POR,197 indicating that the Japanese producers maintain an interest in the Canadian market and have an established Canadian customer base. This export orientation and interest in the Canadian market, in the absence of exports of the subject goods, indicates an inability to compete in Canada at undumped prices.
[234] The Japan Iron and Steel Federation (JISF) and the following Japanese mills; JFE Steel Corporation (JFE), Nippon Steel Corporation, Sumitomo Metal Industries, Ltd., Kobe Steel, Ltd., and Nisshin Steel Co., Ltd., made representations to the Tribunal in the response to its Notice of Expiry.198 The Japanese mills requested that the orders be permitted to expire and indicated that they would not be participating further in the proceedings. The Japanese mills further indicated that their shipments to Canada of automotive end-use corrosion-resistant steel sheet declined over the POR and this indicated the declining importance of Canada as a market for corrosion-resistant steel sheet.199 In addition, JFE has a joint venture with Dofasco (DJ Galvanizing Corp.) in Canada that produces corrosion-resistant steel sheet and the Japanese mills indicated that they have no interest in disrupting the market. It is important to note that the DJ Galvanizing line in Windsor produces corrosion-resistant steel sheet for automotive end use purposes.200
[235] Japan is one of the top crude steel producing nations and one of the world's top major exporters of steel products.201 Evidence on the record indicates that Japan relies heavily on exports to maintain production levels. In 2002 and 2003, Japanese producers had approximately one third of their corrosion-resistant steel sheet production volume (over 4 million tonnes) available for export. In 2002, major export markets for Japanese steel were China, South Korea, Taiwan and Thailand and these export markets accounted for more than 60 percent of all steel exports from Japan.202
[236] In the absence of submissions from Japanese producers of corrosion-resistant steel sheet, the CBSA's analysis of Japanese production was based on information from several sources on the record. Estimated Japanese HDG and EZ production data, based on MB reports and on CRU Monitor data,203 indicated that Japanese production ranged from 14 to 14.5 million tonnes.204 Production data from other sources, such as company web sites and industry publications indicated that production of corrosion-resistant steel sheet was approximately 13.3 million tonnes.205 Possible reasons for the differences could be timing, recording differences and outdated information in view of recent upgrades or new facilities coming on stream. The Japan Iron and Steel Federation reported 12 million tonnes of zinc-coated sheets in 2002 in its report "The Steel Industry of Japan 2003".206 The estimates obtained are generally considered reasonable.207
[237] Between 2000 and 2003, Japanese production capacity for corrosion-resistant steel sheet is estimated to have increased by 9 percent. HDG is estimated to have increased by 16 percent while Japanese production capacity for EZ product decreased by 8 percent. Japanese EZ production accounted for approximately a quarter of total coated production.
[238] Over the POR, the Japanese producers were running at virtually full capacity. The implied domestic consumption rate for HDG and EZ, using the same sources cited above, was determined to be approximately 68 percent of total production in 2002 and 2003 and this suggests that the Japanese producers export a significant proportion of their production. The percentage of Japanese production of HDG and EZ steel products available for export was estimated to be approximately 32 percent or approximately 4 million tonnes annually available for export in 2002 and 2003. Corresponding information was obtained using CRU data. In comparison, the total Canadian market is 1.15 million tonnes, which is merely a fraction of the Japanese volumes available for export.208
[239] Japanese producers have exhibited a behaviour that indicates a propensity to dump. In addition to the orders and findings under review, Canada has a anti-dumping measure in place with respect to Japanese producers of stainless steel round bar. There are presently U.S. anti-dumping measures in place with respect to Japan concerning corrosion-resistant steel sheet. In addition, other U.S. anti-dumping measures in place with respect to Japan include hot-rolled sheet, carbon steel plate and clad steel plate. Furthermore, with respect to different types of steel products, evidence on the record includes other U.S. anti-dumping measures in place with respect to Japan concerning oil country tubular goods, structural beams and seamless pipe.209 Thailand also has anti-dumping measures in place with respect to Japan concerning stainless steel and hot-rolled sheet products.210
[240] Based on significant volumes of corrosion-resistant steel sheet available for export, the export dependency of Japanese producers to justify production volumes, an interest in the Canadian market and an established Canadian customer base, anti-dumping measures in effect abroad, and the apparent inability to compete in Canada at undumped prices, the President determined that the expiry of the orders is likely to result in the resumption of dumping into Canada of certain corrosion-resistant steel sheet products originating in or exported from Japan.
[241] There were no responses to the ERQ from producers in Korea. Over the POR, no Korean exporters participated in normal value and export price reviews. There are no current normal values in place for subject goods from Korea. There were no importations of subject goods from Korea during the POR. However, there were imports of hot-rolled and cold-rolled steel products from Korea during the POR,211 indicating that the Korean producers maintain an interest in the Canadian market and have an established Canadian customer base. This export orientation and interest in the Canadian market, in the absence of exports of the subject goods, indicates an inability to compete in Canada at undumped prices.
[242] In 2002, Korea was one of the top five producers of crude steel production in the world212 and one of the top ten steel exporters in the world. Korea is a net exporter of steel products.213
[243] In the absence of submissions from Korean producers of corrosion-resistant steel sheet, the CBAS' analysis included production information from several sources on the record, including MB Coated Steels Monthly reports, CRU International and company-specific information.214
[244] Estimated Korean HDG and EZ production data, based on MB reports, was approximately 5 million tonnes in 2003 while estimates based on CRU data indicated Korean production at approximately 7 million tonnes. The CRU data includes all coated steel with a metallic coating, excluding tin mills products, which may account for the difference. Production data of HDG and EZ products from other sources such as company web sites and industry publications, was estimated at almost 5 million tonnes.215 Various reasons for the differences could be due to timing, recording differences and outdated information in view of recent upgrades or new facilities coming on stream. In absence of complete information from the exporters, the estimates are considered reasonable.
[245] Evidence on the record indicated that between 2000 and 2003, Korean producers substantially increased their corrosion-resistant steel sheet production capacity by 27 percent. Korean producers' HDG capacity increased by 39 percent, and EZ capacity increased by 8 percent.
[246] Based on the data from MB and CRU sources, the Korean producers of corrosion-resistant steel sheet were running at virtually full capacity. The implied domestic consumption rates for HDG and EZ, based on MB data, were determined to be approximately 82 percent of capacity in 2002 and 88 percent in 2003. Implied domestic consumption rates based on CRU Monitor data were found to be somewhat lower, ranging from 70 percent in 2002 to 72 percent in 2003. Nonetheless, Korean producers had significant volumes available for export. In 2002, at least 700,000 tonnes of corrosion-resistant steel sheet were available for export and in 2003, at least 600,000 tonnes were estimated to be available for export.216 In reality, the actual figures are greater, as the data refers only to production and consumption for the country and imports are not included in arriving at the totals. The Canadian market is dwarfed in face of the Korean volumes. The apparent Canadian market for certain corrosion-resistant steel sheet products was 1.15 million tonnes in 2002.
[247] Korean producers have substantial expansion plans for corrosion-resistant steel sheet production over the next couple of years. In 2004, Dongbu Steel is set to start production of a second HDG automotive dedicated line.217 Hundai Hysco also has indicated that it may be close to commissioning a 95 percent completed HDG line.218 The Hysco line is planned for electrical appliances and building application. SeAh Steel is also planning a galvanizing expansion in 2004.219
[248] Korean steel producers have exhibited a behaviour that indicates a propensity to dump. Besides the orders concerning certain corrosion-resistant steel sheet products, which are the subject goods of this review, there are Canadian anti-dumping measures in place with respect to Korea on other steel products including stainless steel round bar, steel plate and steel pipe.
[249] With respect to the U.S., there are currently anti-dumping measures in place with respect to Korea concerning corrosion-resistant steel sheet and carbon plate. Other anti-dumping measures on flat-rolled products with respect to Korea include Argentina with respect to corrosion-resistant steel products and cold-rolled sheet. Thailand has anti-dumping measures in place with respect to Korea concerning stainless steel, cold-rolled and hot-rolled products. In addition, China also has anti-dumping measures in place with respect to Korea concerning cold-rolled product.220
[250] Current market trends include reports that the automotive industry is uncertain221 and export demand is high.222 Export business with China continues to be strong.223 However, the year 2004 is expected to be a tough year for the Korean steel makers. The Korean Iron and Steel Association indicated that as of January 1, 2004, steel import tariffs into Korea will be eliminated and this will impose pressure on the industry. The Koreans could resort to shipping corrosion-resistant steel sheet into other export markets at any price to maintain production levels. It is likely that Korean producers, pressured by increasing volumes of imports into their domestic market, would start to depend even more on existing and additional export markets.
[251] Based on significant excess production of corrosion-resistant steel sheet available for export, additional new production capacity projected to come on stream, the export dependency of Korean steel producers, anti-dumping measures in place in the U.S. and other countries concerning Korea, an interest in the Canadian market and an established Canadian customer base, and the apparent inability to compete in Canada at undumped prices, the President determined that the expiry of the orders is likely to result in the resumption of dumping into Canada of certain corrosion-resistant steel sheet products originating in or exported from Korea.
[252] Three U.S. producers of subject goods participated in this expiry review, namely USS, ISG and PRO-TEC. They provided individual replies to the ERQ, followed by joint case arguments and reply submissions under the name "U.S. Mills".
[253] The following U.S. producers of certain corrosion-resistant steel sheet products participated in the Tribunal's 1999 expiry review:224 United States Steel International, Inc., National Steel Corporation (both recently restructured and part of USS),225 LTV Steel Company, Bethlehem Steel Export Corporation (both restructured and owned by ISG),226 Ispat Inland Inc. and AK Steel Corporation. The Tribunal found that "virtually all ... imports (of subject goods from the U.S.) were for automotive end uses and that U.S. suppliers were unable to export construction grade sheet at normal value price levels".227
[254] Subsequent to that expiry review, U.S. producers participated in the three normal value and export price reviews conducted by the CCRA during the POR. Eight producers participated in the first review concluded on January 20, 2000;228 three producers participated in the second review concluded on February 15, 2002;229 and five producers that have current normal values in place participated in the most recent review concluded on June 23, 2003.230
[255] These firms requested and received normal values for specific grades and sizes of subject goods for export to Canada. However, since 2000, negligible quantities of approximately 600 tonnes of certain corrosion-resistant steel sheet products were exported from the U.S. to Canada each year. These quantities represent less than 1 percent of the apparent 2002 Canadian market of 1.15 million tonnes a year.231 In comparison, before anti-dumping measures were put in place in 1993, 122 U.S. producers and steel service centres shipped significant quantities of subject goods to Canada.232
[256] The lack of participation by U.S. producers in the Canadian market over the POR suggests an inability to export to Canada without dumping. Evidence on the record demonstrates that Canadian market prices are lower than U.S. normal values.233 Canadian market prices for certain corrosion-resistant steel sheet products are reflective of the commodity nature of the product, which lends itself to natural competitive market forces such as Canadian producers bidding against imported products produced in a dozen different countries.234 Price offers and selling prices tend to converge at the lowest prices.235
[257] In terms of pricing, U.S. producers do not differentiate between domestic and Canadian customers. In the original 1994 finding, the Tribunal noted:236
The market for corrosion-resistant steel sheet is an integrated North American market ... This means that steel mills and their customers, on both sides of the border, compete against each other for business in a North American context. This competition is facilitated by the fact that there is a large number of U.S. steel mills and steel service centres within a relatively short distance of the Canada-U.S. border ... The effect of this market integration is that prices in Canada and the U.S. cannot get seriously out of line with each other ...
[258] An indication that this pricing practice is continuing is the statement by participating U.S. Mills that they "do not differentiate between U.S. and Canadian customers for purposes of pricing".237 It is likely that U.S. producers, in general, could not export to Canada at the same price levels as found in their domestic market because selling prices for corrosion-resistant steel sheet in the Canadian market were lower than the U.S. producers' normal values. Evidence on the record shows that normal values for the U.S. producers were approximately $80 to $500 per tonne higher than the Canadian price offers.238
[259] In 2003, the lowest average value for duty for certain corrosion-resistant steel sheet products from a non-subject country239 and the lowest price offer obtained from various sources on the record240 were lower than the lowest normal value on the record. To compete at these prices, the U.S. exporter with the lowest normal value would have had to dump by about $100 per tonne in order to sell in the Canadian market. Even allowing for differences in prices due to product grades and sizes, the U.S. normal values are substantially higher than the range of import prices found for certain corrosion-resistant steel sheet products from non-subject countries.
[260] Evidence on the record indicated that the 2002 U.S. total production capacity for corrosion-resistant steel sheet was approximately 25 million tonnes241 and total U.S. production was 16.18 million tonnes,242 of which U.S. Mills accounted for a small proportion.243 At the end of 2002, total U.S. excess unused production capacity was almost eight times the size of the Apparent Canadian market for certain corrosion-resistant steel sheet products of 1.15 million tonnes in 2002.244 From the end of 2002 to September 2003, through restructuring by acquiring additional corrosion-resistant steel sheet facilities, U.S. Mills doubled their capacity and production.
[261] Without the restraint of anti-dumping measures, it is expected that U.S. Mills would follow their corporate pricing strategy and re-enter the Canadian market selling at prices that they have been prevented from selling at since 1993. The large number of non-participating producers and steel service centres would also likely find Canada an easy outlet for excess capacity if unhindered by anti-dumping measures.
[262] Historically, once anti-dumping measures are in place with respect to a certain country concerning a steel product, Canadian importers, steel service centers and agents of international trading firms have a history of locating imports from other countries which are not subject to anti-dumping measures in order to avoid anti-dumping duties, and to continue to offer the lowest-priced steel possible, which are often dumped.
[263] During the POR, the U.S. steel industry has been "restructuring after many years of oversupply and low prices attributable largely to excess imports, which resulted in significant capacity closures starting in late 2000..."245 Evidence on the record indicates that some of this idled U.S. corrosion-resistant steel sheet capacity was either restarted in 2003 or is to be started up again in the 2003-2004 period.246 In addition, forecasts on the future indicate that, "a sustainable demand recovery is far from certain..."247
[264] With respect to the goods under review, in the original investigation and the 1994 Tribunal's findings, the U.S. and ten other countries were found to be injuriously dumping certain corrosion-resistant steel sheet products to Canada. Canadian importers switched supply sources to other non-subject countries, which then prompted the Corrosion-resistant Steel Sheet II investigation. In 2000, six new countries were determined to have dumped the subject goods into Canada.248 However, as noted earlier, the Tribunal subsequently found no injury. Canadian importers, no longer under threat of anti-dumping duties, promptly returned to several of these countries.249 This pattern of a rapid resumption of importations from countries no longer subject to anti-dumping measures is likely to happen in the case of the U.S., especially given the proximity to the Canadian market. Approximately 40 U.S. producers have significant excess production capacity available250 and they have been likely unable to ship to Canada because of anti-dumping measures in place. This is in addition to an even greater number of U.S. service centres that have not participated in the Canadian market since 1993.
[265] Participating U.S. Mills argued that the nominal number of anti-dumping measures in place with respect to U.S. steel producers is an indication of no propensity to dump and this factor is recognized as a mitigating element in our review. However, with respect to the U.S. and the evidence on the record, there is a preponderance of factors, which strongly support that the expiry of the orders is likely to result in the continuation and resumption of dumping.
[266] Based on significant excess production capacity in the U.S., uncertain domestic demand, the proximity of the Canadian market, an interest and the maintained presence in the Canadian market, the inability of U.S. exporters to compete in Canada at undumped prices, and a demonstrated ability of Canadian importers to quickly change sources of supply to import at the lowest competitive price point, the President determined that the expiry of the orders is likely to result in the continuation and resumption of dumping into Canada of certain corrosion-resistant steel sheet products originating in or exported from the U.S.
[267] For purpose of making a determination in this expiry review, the CBSA conducted its analysis within the scope of the factors set forth in subsection 37.2(1) of the SIMR. Based on the foregoing consideration of pertinent factors and analysis of evidence on the record, on March 12, 2004, pursuant to paragraph 76.03(7)(a) of SIMA, the President of the Canada Border Services Agency determined that the expiry of the orders made by the Canadian International Trade Tribunal on July 28, 1999, in Review No. RR-98-007, continuing, with amendment, its findings made on July 29, 1994, in Inquiry No. NQ-93-007, concerning certain corrosion-resistant steel sheet products: (1) is likely to result in the continuation or resumption of dumping of the goods originating in or exported from Brazil, the Federal Republic of Germany, Japan and the Republic of Korea; and (2) is likely to result in the continuation or resumption of dumping of the goods originating in or exported from the United States of America.
[268] On March 15, 2004, the Tribunal commenced its inquiry to determine whether the expiry of the orders is likely to result in injury or retardation with respect to goods from the Named Countries. The Tribunal will make its decision by July 27, 2004.
[269] If the Tribunal determines that the expiry of the orders with respect to goods from the Named Countries is likely to result in injury or retardation, the orders will be continued in respect of those goods, with or without amendment. If this is the case, the CBSA will continue to levy anti-dumping duties on dumped importations of certain corrosion-resistant steel sheet products.
[270] If the Tribunal determines that the expiry of the orders with respect to the goods from the Named Countries is unlikely to result in injury or retardation, the orders will be rescinded in respect of those goods. Anti-dumping duties would no longer be levied on importations of certain corrosion-resistant steel sheet products beginning on the date the orders are rescinded.
For further information, please contact Barbara Chouinard at:
Mail
Canada Border Services Agency
Anti-dumping and Countervailing Directorate
100 Metcalfe Street, 11th Floor
Ottawa, Ontario K1A 0L8
Canada
Telephone
(613) 954-7399
Telefax
(613) 941-2612
Email
Barbara.Chouinard@ccra-adrc.gc.ca
Web site
www.cbsa-asfc.gc.ca/sima
M.R. Jordan
Head
Customs Trade, Anti-dumping and Countervailing and Appeals
2 Ex 7 Customs Notice N-523, July 10, 2003.
3 Ex 5 Tribunal orders and reasons, July 28, 1999, pages 26 to 42.
4 Ex 7 Customs Notice N-523, July 10, 2003, pages 2 to 3.
5 Ex 5 Tribunal orders and reasons, July 28, 1999, pages 8 to 9.
6 Ex 2 Tribunal orders and reasons, July 29, 1994, page 3.
7 Ex 105 CCCL response, pages 4 and 7.
8 Ex 68 Stelco submission, page 2.
9 Ex 66 Dofasco submission.
10 Ex 15 Tribunal administrative record LE-2003-005.
11 Ex 144 Statistics for Canadian market table.
12 Ex 144 Statistics for Canadian market table.
13 Ex 138 Enforcement data for certain corrosion-resistant steel sheets. All funds are Canadian dollars unless otherwise indicated.
14 Ex 138 Enforcement data for certain corrosion-resistant steel sheets.
15 Ex 138 Enforcement data for certain corrosion-resistant steel sheets.
16 Based on a 2.64 million-tonne estimate which includes Galvasud, Vega Do Sol, CSN including the new Parana facility, and USIMINAS including Unigal.
17 Ex 1 CCRA statement of reasons, final determination of certain corrosion-resistant steel sheet products, page 8.
18 Ex 75 TKS submission, page 7, B5. Note: CSN owns the other 51 percent of the Galvasud operation.
19 Ex 123 Dofasco supplementary exhibit 38.
20 Ex 75 TKS submission, page 10, B12 response.
21 Ex 123 Dofasco supplementary exhibit 21, CRU International, U.S. production capacities.
22 Ex 150 and Ex 151 New exporter information.
23 Ex 178 and Ex 180 New exporter information.
24 Ex 154 Dofasco, Ex 167 Stelco and Ex 158 Serevco case arguments.
25 Ex 47 International Iron and Steel Institute (IISI) Steel Statistical Data, World Steel in Figures, page 3.
26 Ex 167 Stelco case arguments, page 31.
27 Ex 154 Dofasco case arguments, page 11.
28 Ex 47 World Steel in Figures, page 11.
29 Ex 154 Dofasco case arguments, page 32.
30 Ex 123 Dofasco supplementary exhibit 75.
31 Ex 158 Sorevco case arguments, page 5.
32 CBSA notes that, for the most part, this amount concerns liability for the subject goods that were largely re-exported from Canada under the Duties Deferral and Drawback programs.
33 Ex 154 Dofasco case arguments, pages 10 to 23.
34 Ex 154 Dofasco case arguments, page 48.
35 Ex 158 Sorevco case arguments, page 6.
36 Ex 156 Stelco case arguments, page 13.
37 Ex 156 Stelco case arguments, page 14.
38 Ex 154 Dofasco case arguments, page 47, and Ex 158 Sorevco, page 7.
39 Ex 158 Sorevco case arguments, page 4.
40 Ex 156 Stelco case arguments, page 14.
41 Ex 156 Stelco case arguments, page 28 and Ex 154 Dofasco, page 25.
42 Ex 156 Stelco case arguments, page 31, paragraph 73.
43 Ex 181 Stelco reply submission, page 7, paragraph 33.
44 Ex 181 Stelco reply submission, page 7, paragraph 33.
45 Ex 154 Dofasco case arguments, page 9, paragraph 21.
46 Ex 154 Dofasco case arguments, page 10, paragraph 22.
47 Ex 156 Stelco case arguments, page 33, paragraph 78.
48 Ex 173 Dofasco reply submission, page 11, paragraphs 46 to 48.
49 Ex 156 Stelco case arguments, paragraph 28, citation from RR-98-004, statement of reasons, page 18.
50 Ex 156 Stelco case arguments, paragraph 29, citation from Ex 123 Washington Post and MBR.
51 Ex 173 Dofasco reply submission, page 11, paragraph 49.
52 Ex 173 Dofasco reply submission, page 12, paragraph 51.
53 Ex 154 Dofasco case arguments, page 13, paragraph 37.
54 Ex 154 Dofasco case arguments, page 14, paragraph 38.
55 Ex 154 Dofasco case arguments, page 16, paragraph 42(c).
56 Ex 154 Dofasco case arguments, page 17, paragraph 42(h).
57 Ex 156 Stelco case arguments, paragraph 30.
58 Ex 154 Dofasco case arguments, page 17, paragraph 43.
59 Ex 154 Dofasco case arguments, pages 18 to 19, paragraphs 44 to 47(d).
60 Ex 173 Dofasco reply submission, page 10, paragraph 40.
61 Ex 173 Dofasco reply submission, page 10, paragraph 41.
62 Ex 181 Stelco reply submission, page 5, paragraph 22.
63 Ex 158 Sorevco case arguments, pages 13 to 15, paragraph 35.
64 Ex 158 Sorevco case arguments, pages 10 to 11, paragraph 33.
65 Ex 181 Stelco reply submission, page 6, paragraph 32.
66 Ex 173 Dofasco reply submission, pages 13 to 14, paragraph 52.
67 Ex 154 Dofasco case arguments, page 21, paragraph 55.
68 Ex 47 IISI World Steel in Figures.
69 Ex 154 Dofasco case arguments, page 21, paragraph 52.
70 Ex 154 Dofasco case arguments, page 21, paragraph 54.
71 Ex 154 Dofasco case arguments, page 31, paragraph 84.
72 Ex 154 Dofasco case arguments, page 38, and Ex 165 Stelco case arguments, page 17.
73 Ex 167 Stelco case arguments, page 36.
74 Ex 123 Supplementary exhibit 1, page 4.
75 Ex 167 Stelco case arguments, pages 17 to 18.
76 Ex 123 Supplementary exhibit 78.
77 Ex 123 Supplementary exhibit 77, page 38.
78 Ex 156 Stelco case arguments, page 20.
79 Ex15 Tribunal administrative record, submissions filed by the Japan Iron and Steel Federation and some Japanese mills, appendix 1.
80 Ex 154 Dofasco case arguments, page 13.
81 Ex 154 Dofasco case arguments, page 31, paragraph 86.
82 Ex 154 Dofasco case arguments, pages 39 and 40.
83 Ex 167 Stelco case arguments, page 19.
84 Ex 123 Supplementary exhibits 79 and 80.
85 Ex 154 Dofasco case arguments, page 20, paragraph 49.
86 Ex 154 Dofasco case arguments, page 20, paragraph 50.
87 Ex 156 Stelco case arguments, page 22.
88 Ex 167 Stelco revised case arguments, page 21.
89 Ex 129 Stelco documents and Ex 135 Sorevco notes.
90 Ex 65 Dofasco submission, page 17 and Ex 14 Tribunal administrative record.
91 Ex 105 CCCL submission, A25 response.
92 Ex 161 CSN case arguments, paragraph 8.
93 Ex 161 CSN case arguments, paragraph 9.
94 Ex 161 CSN case arguments, paragraph 10.
95 Ex 163 USIMINAS case arguments, page 4, paragraph 3.
96 Ex 178 CSN reply submission, page 3, paragraph 8.
97 Ex 163 USIMINAS case arguments, page 4, paragraph 10.
98 Ex 161 CSN case arguments, paragraph 11.
99 Ex 178 CSN reply submission, page 3, paragraph 10.
100 Ex 178 CSN reply submission, page 8, paragraph 31.
101 Ex 178 CSN reply submission, page 4, paragraphs 12 to 13.
102 Ex 178 CSN reply submission, page 5, paragraph 19.
103 Ex 178 CSN reply submission, page 7, paragraph 27 and Ex 21-1 CSN ERQ submission.
104 Ex 180 USIMINAS reply submission, page 5, paragraph 15.
105 Ex 161 CSN case arguments, attachment page 1.
106 Ex 161 CSN case arguments, attachment page 2.
107 Ex 161 CSN case arguments, paragraph 3.
108 Ex 163 USIMINAS case arguments, page 3, paragraph 3.
109 Ex 180 USIMINAS reply submission, page 11, paragraph 35.
110 Ex 180 USIMINAS reply submission, page 11, paragraph 35.
111 Ex 161 CSN case arguments, paragraphs 15 and 16.
112 Ex 163 USIMINAS case arguments, page 4, paragraph 16.
113 Ex 178 CSN reply submission, page 8, paragraph 29.
114 Ex 159 TKS case arguments, page 7.
115 Ex 159 TKS case arguments, page 7.
116 Ex 159 TKS case arguments, page 7.
117 Ex 159 TKS case arguments, page 7.
118 Ex 159 TKS case arguments, page 8.
119 Ex 159 TKS case arguments, page 9.
120 Ex 75 TKS submission, appendix B18.
121 Ex 75 TKS submission, appendix B19.
122 Ex 159 TKS case arguments, page 10.
123 Ex 159 TKS case arguments, page 10.
124 Ex 159 TKS case arguments, pages 10 and 11, and Ex 176 TKS reply submission, page 2.
125 Ex 176 TKS reply submission, page 3.
126 Ex 164 U.S. Mills case arguments.
127 Ex 164 U.S. Mills case arguments, paragraph 23.
128 Ex 65 Attachment 8, CRU Monitor, October 2003.
129 Ex 123 Supplementary exhibit 75, HDG planned expansions 2003-2005.
130 Ex 123 Supplementary exhibit 75, capacity expansions.
131 Ex 15 Tribunal administrative record, World Steel in Figures filed by Stelco.
132 Ex 123 Supplementary exhibit 1, MBR Coated Steels Monthly, October 2003, page 6.
133 Ex 123 Supplementary exhibit 63, China Association of Iron and Steel Industry, China's production capacity of corrosion-resistant sheet.
134 Ex 65 Attachment 8, CRU Monitor, production and consumption of coated steel sheet.
135 Ex 123 Supplementary exhibit 1, MBR Coated Steels Monthly, October 2003, page 6.
136 Ex 123 Supplementary exhibit 1, MBR Coated Steels Monthly, October 2003, page 1.
137 Ex 123 Supplementary exhibit 1, MBR Coated Steels Monthly, October 2003, page 6.
138 Ex 123 Supplementary exhibit 56, Angang plans massive expansion, MB, October 13, 2003.
139 Ex 123 Supplementary exhibit 66, Arcelor, Bao Steel and Nippon Steel create Chinese joint-venture for automotive steel.
140 Ex 123 Supplementary exhibit 75, HDG capacity expansions 2003-2005.
141 Ex 5 Tribunal orders and reasons, July 29, 1999, page 26.
142 Ex 14 Dofasco submission, TD Newcrest, Industrial Products, July 7, 2003, page 10.
143 Ex 14 Dofasco submission, TD Newcrest, Industrial Products, July 7, 2003, page 10.
144 Ex 159 TKS case arguments, paragraph 48.
145 Ex 123 Supplementary exhibit 3, Financial Times, Corus warns against steel recovery, November 11, 2003.
146 Ex 123 Supplementary exhibit 59, Mittal warns of Chinese threat, Financial Times December 1, 2003.
147 Ex 123 Supplementary exhibit 1, MBR Coated Steels Monthly, October 23, 2003,
page 6.
148 Ex 50 MBR Coated Steels Monthly, September 24, 2003, page 1.
149 Ex 126 MBR Coated Steels Monthly, December 2003, page 7.
150 Ex 65 Dofasco submission, attachment 8, production and consumption of coated steel product.
151 Ex 136 statistics for imports into Canada of certain corrosion-resistant steel sheet products.
152 Ex 126 MBR Coated Steels Monthly, December 2003, page 3.
153 Ex 15 Tribunal administrative record, TD Newcrest, Industrial Products filed by Stelco, July 7, 2003, page 2.
154 Ex 15 Tribunal administrative record, BMO Nesbitt Burns, Industrial Products Steels
filed by Stelco, July 16, 2003, page 3.
155 Ex 77 CSN submission, pages 39 to 40, B18.
156 Ex 50 MBR Coated Steels Monthly, September 10, 2003, page 3.
157 Ex 50 MBR Coated Steels Monthly, September 10, 2003, page 3.
158 Ex 123 Supplementary exhibit 12, Brazil Steel Industry boasts record 2003 output, Reuters, December 17, 2003.
159 Ex 77 CSN submission, attachments 13 and 16.
160 Ex 79 USIMINAS submission, attachments 13 and 14.
161 Ex 15 Tribunal Transcript of Public Hearing, Vol. 5, May 14, 1999, at 1054.
162 Ex 5 Tribunal expiry review of corrosion-resistant steel sheet RR-98-007, July 28, 1999, page 17.
163 Ex 154 Dofasco case arguments, page 18, paragraph 44.
164 Ex 51 MBR Coated Steels Monthly, September 16, 2003, pages 6 to 7.
165 Ex 77 CSN submission, attachment 13.
166 Ex 79 USIMINAS submission, attachment 13.
167 Ex 79 USIMINAS submission, B18 and B20.
168 Ex 5 Tribunal expiry review of corrosion-resistant steel sheet RR-98-007, July 28, 1999. page 17.
169 Ex 5 Tribunal expiry review of corrosion-resistant steel sheet RR-98-007, July 28, 1999, page 11.
170 Ex 123 Supplementary exhibit 14, "Brazilian Economy Slides Into Recession", The Washington Times, October 23, 2003, page 3.
171 Ex 77 CSN submission, attachment 22, "Brazilian Steel, Domestic Optimism, Global Caution", Morgan Stanley Report, November 10, 2003.
172 Ex 123 Supplementary exhibit 10, supply and demand for coated steel sheet
products, Latin America, CRU Group, Steel Sheet Quarterly and Market Outlook, October 2003.
173 Ex 123 Supplementary exhibit 12, Brazil steel industry boasts record 2003 output, Reuters, December 17, 2003.
174 Ex 136 Canadian import statistics and Ex 144 apparent Canadian market.
175 Ex 75 TKS submission, appendix B22, exhibits 1 to 4.
176 Ex 5, Tribunal orders and statement of reasons, July 28, 1999.
177 Ex 75 TKS submission, appendices 1 to 4, December 19, 2003.
178 Ex 75 TKS submission, appendices 1 to 4, December 19, 2003.
179 Ex 123 Dofasco supplementary exhibit 38 and Ex 75 TKS submission.
180 Ex 50 MBR Coated Steels Monthly, September 24, 2003.
181 Ex 75 TKS submission, appendices 1 to 4, December 19, 2003.
182 Ex 50 MBR Coated Steels Monthly, November 26, 2003.
183 Ex 123 Dofasco supplementary exhibit 75, HDG capacity expansions 2003-2005.
184 Ex 75 TKS submission, appendix B22, exhibit 1.
185 Ex 75 TKS submission, appendix B22, exhibit 1.
186 Ex 126 MBR Coated Steels Monthly, December 22, 2003.
187 Ex 63 International Steel Market Roundup, November and December 2003.
188 Ex 75 TKS submission, appendix B19, Mills eye cost-driven price hikes.
189 Ex 75 TKS submission, appendices 1 to 4.
190 Ex 52 US ITC anti-dumping and countervailing duty orders in place, October 23, 2003.
191 Ex 167 Stelco case arguments, page 42.
192 Ex 5 Tribunal statement of reasons RR-98-007, July 28, 1999.
193 Ex 75 TKS submission, appendix 9.
194 Ex 56 Statement concerning the economy and the steel industry in Germany.
195 Ex 56 Statement concerning the economy and the steel industry in Germany.
196 Ex 50 Coated Steels Monthly, September 24, 2003, page 5.
197 Ex 123 Dofasco supplementary exhibits 73 and 74.
198 Ex 15 Tribunal administrative record LE-2003-005, JISF representation.
199 Ex 15 Tribunal administrative record LE-2003-005, JISF representation, Tab 1.
200 Ex 65 Dofasco submission, page 12.
201 Ex 47 World Steel Org, World Steel In Figures, page 11.
202 Ex 55 The Steel Industry of Japan 2003, page 2.
203 Ex 65 Attachment 8, CRU Monitor, October 2003.
204 Ex 15, 50 and 126 MBR Coated Steels Monthly.
205 Ex 123 Dofasco supplementary exhibits 76 and 78.
206 Ex 55 The Steel Industry of Japan 2003, page 3.
207 Ex 15, 50, 65 and 123.
208 Ex 154 Dofasco case arguments, page 11 and Ex 156 Stelco case arguments, page 19.
209 Ex 158 Sorevco case arguments, page 11.
210 Ex 158 Sorevco case arguments, page 15.
211 Ex 123 Dofasco supplementary exhibits 73 and 74.
212 Ex 47 AISI World Steel in Figures 2003 Edition, page 3.
213 Ex 47 AISI World Steel in Figures 2003 Edition, page 2.
214 Ex 15, 50, 65 and 123.
215 Ex 123 Dofasco supplementary exhibits 75, 79 and 80.
216 Ex 65 Dofasco response, attachment 8, and Ex 15, 50 and 126 MBR Coated Steels Monthly.
217 Ex 50 MBR Coated Steel Monthly, November 2003, page 11.
218 Ex 57 MB Dongbu to add HDG line at Asia, October 29, 2003.
219 Ex 123 Dofasco supplementary exhibit 20 MB, South Korean steel makers to double spending, December 19, 2003.
220 Ex 158 Sorevco case arguments, pages 12 to 16.
221 Ex 50 MBR Coated Steels Monthly, August 4, 2003, page 6 and Ex 50 MBR Coated
Steels Monthly, September 24, 2003, page 6.
222 Ex 15 Tribunal administrative record, CRU Monitor Steel filed by Stelco, July 2003, page 2.
223 Ex 63 International Steel Market Roundup, December 2003.
224 Ex 5 Tribunal orders and statement of reasons expiry review RR-98-007, July 28, 1999, pages 10 and 14.
225 Ex 82 USS ERQ submission, page 11, paragraph A2.
226 Ex 100 ISG ERQ response, page 11, paragraph A2.
227 Ex 5 Tribunal orders and statement of reasons expiry review RR-98-007, July 28, 1999, page 25.
228 Customs Notice N-308, February 11, 2000.
229 Ex 46 Customs Notice N-434, March 8, 2002.
230 Ex 7 Customs Notice N-523, July 10, 2003.
231 Ex 144 apparent Canadian market.
232 Ex 2 Tribunal finding of injury NQ-93-007, statement of reasons, August 15, 1994, page 13 and Ex 15 Tribunal pre-hearing staff report NQ-93-007, June 1, 1994, page 20, table 5, revised June 20, 1994, page 27.
233 Ex 81 USS submission, tab 29 and Ex 45 normal value ruling letters.
234 Ex 136 statistics for imports of certain corrosion-resistant steel sheet products.
235 Ex 2 Tribunal NQ-93-007, statement of reasons, August 15, 1994, page 31 and Ex 5 Tribunal RR-98-007, statement of reasons, July 28, 1999, page 26; Tribunal NQ-2001-001 statement of reasons, page 28; Tribunal NQ-99-004 statement of reasons, July 12, 2000, page 26; expiry review on plate from Mexico, China, South Africa and Russia, and Tribunal RR-2001-006, statement of reasons January 10, 2003, page 14.
236 Ex 2 Tribunal finding of injury NQ-93-007, statement of reasons, page 24.
237 Ex 165 U.S. Mills' case arguments, paragraph 13.
238 Ex 45 normal value ruling letters, Ex 129 Stelco market intelligence and Ex 15 Tribunal administrative record.
239 Ex 136 imports of certain corrosion-resistant steel sheet.
240 Ex 129 Stelco report of price offers and Ex 135 Sorevco report of price offers.
241 Ex 123 Dofasco supplementary exhibit 21, CRU International, October 2003, U.S. production capacity.
242 Ex 126 MBR Coated Steels Monthly, December 22, 2003, page 3.
243 Ex 81 USS submission, tab 24; Ex 102 NSC data; Ex 83 Pro-Tec submission, tab 5; Ex 99 ISG submission, appendices; Ex 106 ISG additional data; Ex 111 ISG additional data; Ex 114 ISG data; Ex 116 ISG additional data; Ex 131 ISG additional data; Ex 134 ISG additional data; Ex 140 ISG additional data; Ex 141 ISG additional data.
244 Ex 123 Supplementary exhibit 21, CRU International, steel sheet quarterly, October 2003, page S108 and Ex 50 MBR Coated Steels Monthly, September 24, 2003, page 3.
245 Ex 82 USS submission, tab 6, page 4, 2002, report to the Securities and Exchange Commission (Form 10-K).
246 Ex 154 Dofasco case arguments, page 43, paragraph 111 and Ex 123 Supplemental exhibit 75, page 4, CRU Monitor, hot-dipped galvanized steel sheet capacity expansions 2003-2005; Ex 171 U.S. Mills reply submission, paragraph 36.
247 Ex 126 MBR Coated Steels Monthly, December 22, 2004, page 1.
248 Ex 3 CBSA statement of reasons, final determination of dumping of
corrosion-resistant steel sheet from the People's Republic of China, India, Malaysia, the Russian Federation, South Africa and Chinese Taipei.
249 Ex 136 imports of corrosion-resistant steel sheet.
250 Ex 123 Supplementary exhibit 21, CRU International, Steel Sheet Quarterly October 2003, Production capacities of steel companies, steel sheet products, North America, 2002.
