ARCHIVED - Statement of Reasons

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OTTAWA, February 25, 2005

RR-2004-004
4258-108/4218-8

Concerning a determination under paragraph 76.03(7)(a) of the Special Import Measures Act respecting

CERTAIN HOT-ROLLED STEEL PLATE ORIGINATING IN OR EXPORTED FROM BRAZIL, FINLAND, INDIA, INDONESIA, THAILAND AND UKRAINE

DECISION

On February 10, 2005, 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 finding made by the Canadian International Trade Tribunal on June 27, 2000, in Inquiry No. NQ-99-004, as amended on August 23, 2004, in Interim Review No. RD-2004-002, concerning certain hot-rolled steel plate, originating in or exported from Brazil, Finland, India, Indonesia, Thailand and Ukraine was likely to result in the continuation or resumption of dumping into Canada of the goods from Brazil, India, Indonesia and Ukraine, was unlikely to result in the continuation or resumption of dumping into Canada of the goods from Finland and Thailand and was likely to result in the continuation or resumption of subsidizing of the goods from India, Indonesia and Thailand.

This statement of reasons is also available in French. Cet énoncé des motifs est également disponible en français.

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TABLE OF CONTENTS

• SUMMARY
• BACKGROUND
• PRODUCT DESCRIPTION
• CLASSIFICATION OF IMPORTS
• PERIOD OF REVIEW
• CANADIAN INDUSTRY
  • Algoma
  • IPSCO
  • Stelco
• CANADIAN MARKET
• ENFORCEMENT
• PARTICIPANTS
• INFORMATION USED BY THE PRESIDENT
  • Administrative Record
• POSITION OF THE PARTIES
  • Parties Contending that Continued or Resumed Dumping and Subsidizing is Likely
    • Positions of the Canadian Producers - General
    • Positions of the Canadian Producers - Country Specific
  • Parties Contending that Continued or Resumed Dumping and Subsidizing is Unlikely
    • India
• CONSIDERATION AND ANALYSIS
• Likelihood of Continued or Resumed Dumping
  • Factors Related to the Nature of the Product
  • Changes in the circumstances surrounding steel plate market conditions
  • Brazil
  • Finland
  • India
  • Indonesia
  • Thailand
  • Ukraine
• Likelihood of Continued or Resumed Subsidizing
  • India
  • Indonesia
  • Thailand
• CONCLUSION
• FUTURE ACTION
• INFORMATION

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SUMMARY

[1] On October 13, 2004, the Canadian International Trade Tribunal (Tribunal), pursuant to subsection 76.03(3) of the Special Import Measures Act (SIMA), initiated an expiry review of its finding issued on June 27, 2000, in Inquiry No. NQ-99-004, as amended on August 23, 2004, in Interim Review No. RD-2004-002, (referred to as "the Finding"), concerning certain hot-rolled steel plate, originating in or exported from Brazil, Finland, India, Indonesia, Thailand and Ukraine (collectively known as "the Named Countries").

[2] The Canada Border Services Agency (CBSA) initiated an expiry review on October 14, 2004, to determine whether the expiry of the Finding is likely to result in the continuation or resumption of dumping and/or subsidizing of the goods from the Named Countries.

[3] On February 10, 2005, the President of the CBSA (President) determined, pursuant to paragraph 76.03(7)(a) of the SIMA, that the expiry of the finding with respect to certain hot-rolled steel plate originating in or exported from Brazil, Finland, India, Indonesia, Thailand and Ukraine was likely to result in the continuation or resumption of dumping into Canada of the goods from Brazil, India, Indonesia and Ukraine, was unlikely to result in the continuation or resumption of dumping into Canada of the goods from Finland and Thailand and was likely to result in the continuation or resumption of subsidizing of the goods from India, Indonesia and Thailand.

BACKGROUND

[4] An investigation was initiated on October 15, 1999, following a complaint filed by Canadian producers, respecting the alleged injurious dumping into Canada of certain hot-rolled steel plate originating in or exported from Brazil, Finland, India, Indonesia, Thailand and Ukraine and the injurious subsidizing of certain hot-rolled steel plate originating in or exported from India, Indonesia and Thailand.

[5] A preliminary determination of dumping and subsidizing was made on February 28, 2000. On May 29, 2000, a final determination of dumping was made with respect to the subject goods from Brazil, Finland, India, Indonesia, Thailand and Ukraine and a final determination of subsidizing was made with respect to the subject goods from India, Indonesia and Thailand. On June 27, 2000, in Inquiry No. NQ-99-004, the Tribunal found that the dumping and subsidizing of the subject goods had caused material injury to the domestic industry. Imports of the subject goods from these countries have been subject to anti-dumping and countervailing measures since the Finding has been in place.

[6] The original investigation is informally referred to as "Plate IV" because it followed three previous investigations of hot-rolled steel plate from various countries, referred to as "Plate I", "Plate II" and "Plate III". Another dumping investigation involving three other countries, "Plate V", followed Plate IV and resulted in an injury finding by the Tribunal. Attached as an appendix to this Statement of Reasons is a listing of the various findings and orders concerning steel plate.

[7] On January 15, 2002, a re-investigation to update normal values and export prices was concluded with regard to Plate II, Plate III and Plate IV and to update the amounts of subsidy with respect to Plate IV. The results of this re-investigation were made public in Customs Notice N-433, on March 4, 2002.

[8] The CBSA initiated a second review of the amounts of subsidy with respect to Plate IV on June 16, 2004. Parties to which requests for information were sent were advised that their response would be placed on the record in the eventuality that an expiry review for Plate IV was initiated. The review of the amounts of subsidy was concluded on September 2, 2004, with the results of this review being made public in Customs Notice N-589 on September 22, 2004.

[9] On August 23, 2004, the Tribunal, following the receipt of a request for product exclusion, concluded Interim Review No. RD-2004-002 and issued an order, pursuant to paragraph 76.01(5)(b) of the SIMA, amending the finding made on June 27, 2000, to exclude certain pressure vessel quality carbon steel plate (ASTM A516 grade 60 modified) from the product definition.

[10] On August 23, 2004, the Tribunal also issued a notice concerning the upcoming expiry of the Finding. Based on the available information and the information submitted by the interested parties, the Tribunal decided that a review of the Finding was warranted. On October 13, 2004, the Tribunal initiated an expiry review (RR-2004-004) of the Finding that is scheduled to expire on June 27, 2005. On October 14, 2004, the CBSA initiated an expiry review to determine whether the expiry of the Finding is likely to result in the continuation or resumption of dumping and/or subsidizing of the goods from the Named Countries.

PRODUCT DESCRIPTION

[11] For purposes of this review, certain hot-rolled steel plate is defined as:

• hot-rolled carbon steel plate and high-strength low-alloy steel plate not further manufactured than hot-rolled, heat-treated or not, in cut lengths, in widths from 24 inches (+/- 610 mm) to 152 inches (+/- 3,860 mm) inclusive, and:
• in thicknesses from 0.187 inches (+/- 4.75 mm) to 5.25 inches (+/- 133 mm) inclusive, excluding plate produced to American Society for Testing & Materials (ASTM) specifications A515 and A516M/A516 Grade 70 in thicknesses greater than 3.125 inches (+/- 79.3 mm), originating in or exported from Brazil, Finland, India, Indonesia and Thailand,
• in thicknesses from 4.0 inches (+/- 101 mm) to 5.25 inches (+/- 133 mm) inclusive, excluding plate produced to ASTM specifications A515 and A516M/A516 Grade 70, originating in or exported from Ukraine,
• in thicknesses from 0.187 inches (+/- 4.75 mm) to 3.125 inches (+/- 79.3 mm) inclusive, originating in or exported from Ukraine, produced to ASTM specifications A515 and A516M/A516 Grade 70 which meet the following carbon equivalent as per American Society of American Engineers (ASME) SA-20:
  • carbon equivalent equal to or less than 0.40 for plate equal to or less than 1.5 inches (38.1 mm) in thickness; or
  • carbon equivalent equal to or less than 0.42 for plate greater than 1.5 inches (38.1 mm) in thickness; or
  • carbon equivalent equal to or less than 0.42, with maximum hydrogen and oxygen contents of 2 parts per million and 10 parts per million respectively, for plate equal to or less than 1.5 inches (38.1 mm) in thickness,
• excluding universal mill plate, plate for use in the manufacture of pipe and plate having a rolled, raised figure at regular intervals on the surface (also known as floor plate), originating in or exported from Brazil, Finland, India, Indonesia, Thailand and Ukraine.

[12] For greater clarity, the Canadian Standards Association (CSA) specifications covered by the product definition represent different grades within the broad specification G40.21 that covers steel for general construction purposes. In the ASTM specifications A283M/A283 and A36M/A36 include structural plate; specifications A572M/A572, A588M/A588 and A242M/A242 include high-strength low-alloy steel plate; and specifications A515M/A515 and A516M/A516 include pressure vessel quality plate. The ASTM specification A36M/A36 is considered to be equivalent to the CSA specification G40.21, grade 300W/44W and together these are the most common specifications of structural quality plate sold in Canada. The most common specification of pressure vessel quality plate sold in Canada is the ASTM specification A516M/A516, grade 70.

[13] The product definition is subject to the Tribunal's order of August 23, 2004, with regard to Interim Review No. RD-2004-002.

CLASSIFICATION OF IMPORTS

[14] The hot-rolled steel plate products that are subject to this expiry review are normally imported into Canada under the following Harmonized System (HS) classification numbers:¹

7208.51.91.10	7208.51.99.10	7208.52.90.10
7208.51.91.91	7208.51.99.91	7208.52.90.91
7208.51.91.92	7208.51.99.92	7208.52.90.92
7208.51.91.93	7208.51.99.93	7208.52.90.93
7208.51.91.94	7208.51.99.94	7208.52.90.94
7208.51.91.95	7208.51.99.95	7208.52.90.95

PERIOD OF REVIEW

[15] The period of review (POR) for this expiry review is January 1, 2001 to September 30, 2004.

CANADIAN INDUSTRY

[16] The Canadian industry for steel plate production is comprised of Algoma Steel Inc. (Algoma) of Sault Ste. Marie, Ontario and IPSCO Inc. (IPSCO) of Regina, Saskatchewan. Stelco Inc. (Stelco) of Hamilton, Ontario, is a former producer of steel plate.

Algoma

[17] Algoma Steel Inc. was incorporated on June 1, 1992, when the company acquired all of the assets and some of the liabilities of Algoma Steel Corporation. The company was further reorganized on January 29, 2002. Algoma, with its subsidiaries, is a vertically integrated primary iron and steel producer having a present capacity to produce approximately 2.7 million metric tonnes (tonnes²) of raw steel annually. Expressed in terms of finished steel products, the annual capacity is approximately 2.3 million tonnes consisting of steel plate, hot-rolled sheet, cold-rolled sheet and unfinished parts. Algoma operates a major steelworks at Sault Ste. Marie, Ontario.³

IPSCO

[18] IPSCO Inc. was incorporated in 1956 under the name of Prairie Pipe Manufacturing Co. Ltd. It commenced operations in 1957 with the completion of construction of an electric resistance weld (ERW) pipe mill in Regina. In 1959, the company acquired the assets of Interprovincial Steel Corp. Ltd. and in 1960, it commenced production of its own flat-rolled steel, including steel plate. Since that time, the company has expanded its manufacturing capabilities through acquisition and plant construction. Steel plate products are manufactured in discrete form at the company's steel mill in Regina, Saskatchewan and cut-to-length plate products are produced from coil in Regina, Saskatchewan, Surrey, B.C., and Toronto, Ontario.⁴

Stelco

[19] Stelco Inc. is an integrated steel company producing flat-rolled steel, bars and rods, as well as wire, wire products and pipes and tubes. Stelco is a former producer of hot-rolled steel plate. The company ceased producing the goods when it idled its plate mill in April 2003.⁵ The company closed its plate mill permanently in early 2004.

CANADIAN MARKET

[20] In 2003, the Canadian manufacturers sold approximately 375,000 tonnes of hot-rolled steel plate into the Canadian market.⁶ The manufacturers' share of the apparent Canadian market was about 54% at that time.⁷ Stelco ceased production of steel plate in April of 2003.

[21] The apparent Canadian market for hot-rolled steel plate has declined since the beginning of the POR as indicated in the following table:

Table 1

Apparent Canadian Market ⁸

Hot-rolled Steel Plate (Tonnes)

Source	2001	2002	2003	Jan-Sept 2003	Jan-Sept 2004
Total Canadian Producers	584,266	447,298	374,791	297,481	XXX
Plate IV Named Countries	22	43	3	3	109
Plate II Named Countries	30	1,391	140	140	0
Plate III Named Countries	27,244	3,278	1,121	818	2,319
Plate V Named Countries	N/A	N/A	4	0	7,763
Other Countries	201,348	273,532	316,745	244,042	318,107
Total Market *	812,910	725,542	692,804	542,484	XXX

Notes: Stelco ceased production in April 2003.

Plate II rescinded on May 17, 2004. Imports from Plate II countries made after this date are in "Other Countries".

Plate V finding was made on Sept. 11, 2003. Imports from Plate V countries made prior to this date are in "Other Countries". The CBSA is unable to release the Canadian producers' volumes for 2004 as this would result in the release of confidential information.

ENFORCEMENT

[22] A total of 177 tonnes of subject goods originating in Brazil, Finland and Ukraine were imported into Canada during the POR.⁹ There were no imports of subject goods from India, Indonesia and Thailand.

[23] In the enforcement of the Finding during the POR, anti-dumping duty was collected on subject goods from Finland and Ukraine totalling approximately $201,000.

PARTICIPANTS

[24] At the start of this 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, exporters and the governments of the countries that are subject to countervailing duty. At the same time, any person or government having an interest in the CBSA's review was invited to provide a submission containing information that they deemed relevant.

[25] Expiry Review Questionnaires (ERQs) were made available to the Canadian producers of steel plate, known exporters of the goods originating in or exported from the Named Countries, Canadian importers of the goods and to the governments of India, Indonesia and Thailand 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 and/or subsidizing. Interested persons were also invited to provide case arguments regarding the likelihood of continued or resumed dumping and/or subsidizing of the goods if the Finding expired. In addition, persons were provided an opportunity to submit reply submissions providing their comments in respect of the case arguments submitted by other persons.

[26] Both Canadian producers participated in the expiry review by providing a response to the ERQ for producers and by making case arguments stating that the dumping and subsidizing of the subject goods would continue or resume if the Finding expired. Algoma and IPSCO did not make reply submissions since they were the only parties to provide case arguments. Stelco provided a limited response to the ERQ for producers.

[27] Only one exporter, Steel Authority of India Limited (SAIL) elected to participate in the expiry review. The exporter supported the notion that the export of subject goods from India was not likely to result in the continuation or resumption of dumping and subsidizing if the Finding expired. The governments of India and Thailand submitted responses to the ERQ for governments. In providing their responses, both governments did not explicitly express a position on whether the expiry of the Finding would result in the continuation or resumption of dumping and subsidizing. None of these parties submitted case arguments or reply submissions.

[28] Only one importer of goods, Salzgitter Trade Inc., submitted a response to the ERQ for importers. The importer provided requested information but did not express an opinion concerning the likelihood of continued or resumed dumping and/or subsidizing and did not further participate in the proceedings.

INFORMATION USED BY THE PRESIDENT

Administrative Record

[29] The information used and considered by the President for purposes of this expiry review proceeding 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 and/or subsidizing is likely to continue or resume, absent of the Finding. This information consists of reports from expert analysts, 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, responses to the ERQs submitted by Canadian producers, importers, exporters and foreign governments.

[30] 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 administrative record closed on December 2, 2004. This allowed participants time to prepare their case arguments based on the information that was on the administrative record as of the closing of the record date.

POSITION OF THE PARTIES

Parties Contending that Continued or Resumed Dumping and Subsidizing is Likely

[31] The two current Canadian producers, Algoma and IPSCO provided responses to the ERQ for producers and presented arguments and additional evidence that the dumping into Canada and the subsidizing of certain hot-rolled steel plate from the Named Countries would continue or resume in the event of the expiry of the Finding.

Positions of the Canadian Producers - General

[32] The Canadian producers presented several common arguments notably dealing with the market conditions for Canada and the world and the influence of China on these conditions, the excess supply and production capacity of steel plate in the Named Countries, the dependency on exports by producers in the Named Countries, the volume of dumped subject goods, the influence of low-priced imports of steel plate from other countries, the trade actions in place on the Named Countries and the continued subsidization of subject goods from India, Indonesia and Thailand.

[33] In addressing the market conditions in which the Canadian producers operate, IPSCO focused on the integrated North American steel market in its arguments. The company stated that the North American steel market is artificially and temporarily out of equilibrium in terms of the supply and demand balance and that this equilibrium will correct itself in the near to medium term.¹⁰ IPSCO submitted that there is a likelihood of price declines from those prevailing in 2004. Demand has not increased with any significance in this market and supply shortages are due to raw material shortages and increases in demand for imports by China according to the producer.¹¹

[34] IPSCO maintained that the North American and European Union (EU) markets are the highest priced markets in the world and that once demand in China declines, the excess supply of plate including that from the Named Countries will be drawn to the North American market. IPSCO claimed that exports from the Named Countries will be made at dumped and/or subsidized prices in order to gain market share from Canadian producers and from non-subject imports of steel plate.¹²

[35] With respect to the Canadian market, Algoma submitted that consumption has declined significantly over the past years with domestic consumption in 2003 at the lowest level in the past eight years. Plate consumption has increased significantly in 2004 but on an annualized basis will still be below the levels before and at the time of the Finding in 2000.¹³ Algoma submitted that low-priced imports of steel plate have continued to increase their share of the Canadian market since the Finding was made and the trend has continued into 2004. Algoma noted the idling in 2003 and eventual closure of Stelco's plate mill in 2004 and that the steel plate market in Canada over the POR was one of declining demand and continued presence of low-priced imports.¹⁴

[36] Algoma stated that steel plate demand in 2005, in Canada, is expected to be similar to 2004, pointing to consumption levels below those seen before and at the time of the Finding. The company claimed that the continued or resumed presence of dumped and/or subsidized imports from the Named Countries would have a dampening effect on prospects for maintaining price increases that the domestic industry was able to put in place in 2004. Algoma also claimed that even without the presence of imports of subject goods, 2005 and 2006 prices are expected to decline gradually from peak 2004 prices.¹⁵

[37] In presenting their description of the worldwide situation in the steel market, the Canadian producers submitted that the global steel market was still encountering excess capacity and overproduction and that the situation would not change in the short term. They pointed to evidence that several countries are continuing to add capacity and production facilities particularly in China.

[38] Algoma noted that much has been made on the impact that the Chinese steel market has had on the global steel market conditions. The company referred to the Plate II decision in 2004 made by the Tribunal whereby it rescinded the finding on certain steel plate from Italy, Korea, Spain and Ukraine. Algoma stated that the facts regarding China have changed since that expiry review and that there is a trend of declining imports of flat steel products into China during the POR of this expiry review. It also submitted that the decline suggests that even if the Named Countries were able to export to China in 2003 and early 2004, the demand in China cannot absorb increased worldwide production capacity and that Canada would be an attractive alternative export market for producers in the Named Countries.¹⁶

[39] In presenting its position with respect to the influence of the Chinese steel market on the global steel market, IPSCO referred to and cited several steel industry reports. It recognized that China constituted the strongest export market for steel plate but argued that any excess inventory that is not absorbed by the Chinese market will likely be diverted to the North American market. IPSCO referred to the warnings being sounded over the risk of overcapacity in China and that steel output in that country has doubled between 2000 and 2004.¹⁷

[40] IPSCO submitted that Metal Bulletin Research (MBR) reported that 23 new plate rolling mills with a capacity of 17 million tonnes per year were installed in 2003 and an additional 15 new plate mills with a capacity of 17 million tonnes were due to be completed and on stream in 2004. IPSCO noted that MBR also predicted that by 2005, Chinese plate imports are likely to shrink significantly, resulting in a price downturn.¹⁸

[41] IPSCO also submitted that Steel RX reported that although demand for steel is expanding in China, the pace is unsustainable. In order to absorb the supply of steel at current (2004) production levels, global steel consumption (excluding China) must grow 4% in 2004, which Steel RX considers a remote possibility. The source given by IPSCO also referred to a "phantom boom" in the steel market which will inevitably turn into a real downturn unless steel demand in China can be maintained at well above 14% per year in the short to medium term.¹⁹

[42] IPSCO referred to reports indicating increased steel exports from China due to the wide price differential between China and the rest of the world. The company noted that the Chinese Government has warned that its steel production capacity may exceed demand as soon as 2007. It also submitted that although recent levels of steel demand in China have been impressive, driving global prices to record highs, World Steel Dynamics (WSD) predicts that an oversupply of steel products will develop in China by mid-2005 causing prices to come down sharply.²⁰ IPSCO also noted that the Chinese Government has implemented restrictive measures to slow growth in the Chinese steel industry.²¹

[43] IPSCO submitted that the presence in the Canadian market of plate products from China confirms there is excess supply in the Chinese market illustrating that weakening demand is more widespread in Asia. IPSCO also submitted that any excess subject goods from the Named Countries or steel plate from China that cannot be absorbed by the Chinese market would likely find its way to the North American market.²²

[44] IPSCO noted that MBR predicts a price downturn in 2005 as a result of declining demand in China and forecasts a swing in China's current net import position. It also forecasts a significant steel market change in the second half of 2005 and warns that any downturn in Chinese steel demand will result in massive internal oversupply and a surge in exports at any price.²³ IPSCO also referred to a similar forecast by WSD pointing to: an end to the global steel shortage by April 2005; a fall in world steel export prices during the remainder of 2005; one-year contract steel prices being substantially higher in 2005 than in 2004; and world steel export prices in 2005 bottoming out at levels higher than expected.²⁴

[45] The Canadian producers contended that the steel plate mills in the Named Countries all have significant production capacity and excess capacity. Their total plate production capacity greatly exceeds the needs of the Canadian market according to both producers. Algoma provided an estimated total production for the Named Countries at 12.7 million tonnes per year, which it claimed represented 46 times the Canadian market.²⁵ IPSCO submitted that evidence on the record indicates that production levels have increased significantly in the last year and also details extensive plans to increase production in the Named Countries.²⁶ Algoma submitted that, because of the substantial production capacity and capacity underutilization of the plate mills in the Named Countries, a resumption of dumping from the Named Countries was likely if the Finding was rescinded.²⁷ Algoma and IPSCO also both noted the dependency of producers in some of the Named Countries on exports to maintain capacity utilization.

[46] Algoma submitted that the data on the CBSA's record indicates that the volume of imports of subject goods from the Named Countries declined significantly since the Finding.²⁸ The company submitted that this illustrates the inability of exporters from the Named Countries to make sales at normal values since the Finding and noted that the President has considered this in the past to be a strong indicator that dumping will resume if an order or finding is rescinded.²⁹

[47] Algoma submitted that imports of subject goods from the Named Countries must compete with imports from other countries. The company noted the significant volume of low-priced imports from Italy and Ukraine of plate products previously covered by the Plate II finding that was rescinded in 2004. Algoma stated that over 60,000 tonnes of low-priced plate were imported into Canada from Italy and Ukraine.³⁰ Algoma referred to evidence it filed with the CBSA with respect to low-priced imports into Canada of steel plate from certain countries not covered by injury findings. The producer provided several examples of what it considered to be evidence of low-priced sales to Canada. Algoma submitted that if the Finding was rescinded, imports from the Named Countries would continue to be dumped, or dumping would resume, in order to compete with the low-priced imports from other countries including Ukraine.³¹

[48] IPSCO remarked that average import values from non-subject countries were well below current Canadian pricing levels and that this represents the pricing level that subject goods will have to compete with. IPSCO also referred to the influence of low-priced imports of steel plate from Ukraine and submitted that the Named Countries, if not constrained by the Finding, will have to sell at dumped prices to compete with other low-priced imports.³²

[49] The Canadian producers submitted that the evidence relating to the numerous trade actions taken by Canadian authorities and by authorities in other countries against steel producers from the Named Countries demonstrates a propensity by these producers to dump and/or subsidize subject goods as well as other hot-rolled steel products and other steel products. They also submitted that these numerous trade actions have an influence on the selling price of steel plate products on an international basis.

[50] Algoma submitted that the performance, with respect to marketing practices, and the likely performance, of foreign producers/exporters and their agents, brokers and traders increase the likelihood of resumed dumping. In particular, Algoma referred to the Canadian importers' destabilizing practice of source switching as importers move from country to country in reaction to trade actions. The company noted that past Tribunal findings confirmed that these enterprises are adept at sourcing and importing low-priced steel. Algoma claimed that these same importers continue to be active in the Canadian steel plate market.³³

[51] Algoma also submitted that many steel producers have the ability to produce both steel plate and hot-rolled steel sheet on the same facilities thus creating a potential for them to switch production if trade actions were in place against hot-rolled steel sheet.³⁴

[52] Both Canadian producers submitted that evidence on the CBSA's record points to the continuation or resumption of subsidization of subject goods from India, Indonesia and Thailand. Algoma submitted that there is no evidence on the record that suggests that any subsidy programs have been removed and the fact that there were no imports from these countries during the POR indicates that they cannot compete without using price undercutting in the Canadian market as they did prior to the Finding.³⁵ IPSCO pointed to various reports that illustrate that subsidies are prevalent in the steel industry.³⁶

[53] Algoma stated that given the non-participation of producers and exporters of subject goods from the Named Countries other than one from India in these proceedings, there was not sufficient evidence on the record to support a determination that dumping is not likely to continue or resume.³⁷

Positions of the Canadian Producers - Country Specific

Brazil

[54] Algoma submitted that Brazil is one of the largest producers and exporters of steel products in the world. The company maintained that steel mills in this country have significant production capacity and overcapacity and that Brazilian steel producers are very dependent on exports to maintain capacity. IPSCO pointed to research reports and noted that Brazil's output of flat steel products increased by 12.5% to 4.7 million tonnes in the first four months of 2004 while domestic sales in Brazil rose 6.5%. It also noted that several steel production facilities were planned including a new integrated steel facility with a capacity of up to 7.5 million tonnes of steel slab to start in 2005 and that, overall, Brazil's national steel capacity was expected to double to 69 million tonnes by 2010 from 34 million tonnes in 2004.³⁸

[55] With respect to the Usiminas Group, IPSCO submitted that there are reports that this group is planning to increase crude steel production to 10 million tonnes per year from 9.2 million tonnes and that the group's steel output rose 3.3% in the first half of 2004 while its exports rose 11%.³⁹

[56] Algoma argued that in terms of subject goods from Brazil, producers from this country have not been able to compete at normal values and that since the Finding, only 22 tonnes of Brazilian steel plate were imported into Canada in 2001.⁴⁰ Algoma also noted that Brazilian producers have been unable to compete in the United States of America (U.S.) where they are subject to a dumping finding.⁴¹

[57] IPSCO referred to steel industry reports that claimed that due to a reduction of steel imports into China, Brazilian producers have redirected their exports to the U.S. market where they can obtain 15-20% higher prices for steel products such as steel plate. The company also referred to reports that Brazilian producers will switch their export targets to the higher-priced North American market, which will result in greater volumes of dumped goods entering Canada and noted that several Brazilian producers have recently shown increases in their steel exports despite signs of increased domestic demand.⁴²

[58] IPSCO submitted that certain countries have implemented trade measures against Brazilian producers of flat-rolled steel products.

[59] Algoma noted that Brazilian producers had chosen to not participate in the proceedings of this expiry review and submitted that substantial volumes of plate imports from Brazil will be dumped if the finding on Brazil is terminated.⁴³

Finland

[60] IPSCO submitted that the U.S. has implemented trade measures on steel plate from Finland and goods were likely to be diverted to Canada if the finding on Finland was rescinded.⁴⁴

India

[61] Algoma submitted that due in large part to continual increases in steel production capacity by Indian producers that already have significant production capacity, producers of subject goods in India are likely to continue or resume dumping of subject goods to Canada if the finding on the country is rescinded.⁴⁵

[62] Algoma stated that the total capacity of the Indian mills for which it had information was over 6.1 million tonnes and that these producers alone have a capacity that is over 22 times the size of the entire Canadian market. Algoma also referred to evidence on the CBSA's record that demonstrates that Indian plate producers intend to continue to increase their production capacity. The company claimed that with such massive capacity and a history of past dumping, it is inevitable that Indian producers would continue or resume dumping into Canada if the finding on India is rescinded.⁴⁶

[63] IPSCO referred to industry reports and submitted several examples of planned significant crude steel and slab production expansions in India. The company also pointed to steel plate capacity increases such as those planned by SAIL, Tata Steel (TISCO) and Jindal Iron and Steel Company Limited (Jindal).⁴⁷

[64] IPSCO submitted that a new steel policy was put in place by the Government of India that is aimed at containing costs and intended to encourage exports. The company referred to reports that the new steel policy is expected to facilitate the expansion of production facilities by SAIL and TISCO.⁴⁸ IPSCO also submitted that in order to facilitate the new policy of increasing steel exports, the Government of India restored a duty entitlement program in July 2004, whereby steel producers receive a cash benefit based on the volume of their exports. The company noted that the U.S. recently imposed a countervailing duty on hot-rolled flat steel products from India.⁴⁹ IPSCO also noted that India was subject to anti-dumping and countervailing measures by the EU as well as anti-dumping measures by Thailand.⁵⁰

Indonesia

[65] IPSCO submitted that according to industry reports, PT Krakatau Steel, the state-owned and largest steel producer in Indonesia, planned to more than double its crude steel production to 5 million tonnes by 2008 following an upgrade to the company's hot-rolled steel production facilities.⁵¹

[66] IPSCO noted several trade measures against flat-rolled steel products from Indonesia namely, anti-dumping measures by the U.S. and Thailand and measures put in place by Australia specifically on steel plate products. IPSCO also noted the countervailing measures put in place by the U.S. on flat-rolled products from Indonesia.⁵²

Thailand

[67] IPSCO referred to industry reports and submitted that a certain producer in Thailand, Sahaviriya Steel Industries, planned to embark on a massive steelmaking project with a total capacity of 30 million tonnes per year and that this will turn Thailand from a net steel importer to a major steel exporter. IPSCO noted that this producer would be installing a new reheating furnace in February 2005 that would increase its hot-strip mill capacity by 1.5 million tonnes.⁵³

[68] IPSCO remarked that authorities in the U.S. and Australia have imposed anti-dumping duty on flat steel products from Thailand and that the U.S. authorities also imposed countervailing measures on hot-rolled flat steel products.⁵⁴

[69] With respect to subsidies, IPSCO referred to reports that the steelmaking project planned by Sahaviriya Steel Industries was made "with government endorsement."⁵⁵

Ukraine

[70] Algoma submitted that Ukraine is one of the largest producers and exporters of steel products in the world. The company maintained that steel producers in this country are very dependent on exports to maintain capacity. Ukrainian exports of steel totalled over 29 million tonnes in 2002 compared to domestic consumption of 1.9 million tonnes.⁵⁶ IPSCO submitted that production of finished steel increased 5.6% during the first 8 months of 2004 as compared to 2003 and that the increase was mainly achieved in flat-rolled steel production. The company also noted that Ukraine's production of 37 million tonnes far exceeded its consumption of only 5 million tonnes in 2003.⁵⁷

[71] Algoma stated that the total capacity of at least two of three Ukrainian mills was over 3.5 million tonnes, which represents over five times the size of the Canadian market.⁵⁸ IPSCO referred to an industry report that stated that Azovstal had announced a plan to install a new slab caster with a capacity of 2.5 million tonnes that would bring its plate mill capacity to 6 million tonnes.⁵⁹

[72] Algoma referred to the 1993 Plate II finding on Ukraine, where certain PVQ products had been excluded, and to the 2000 Plate IV finding (under this expiry review) where the Tribunal denied a request for certain exclusions. Algoma argued that Ukrainian producers had deliberately switched substantial export volumes of plate, which had become subject goods, to plate that had been excluded from the Plate II finding in order to circumvent the finding.⁶⁰ Algoma recognized that the remaining steel plate subject to the current finding on Ukraine is very specialized plate but noted that exporters from Ukraine had previously used the exclusion from Plate II to deliberately circumvent that finding.⁶¹ IPSCO also commented on the behaviour of Ukrainian producers following the Plate II finding and submitted that these producers exported goods to Canada that were only slightly over the maximum thickness of 4 inches but were marketed as goods that would normally be considered subject goods. IPSCO also claimed that Ukrainian producers took advantage of certain product exclusions and began exporting excessive amounts of low-priced steel plate products.⁶²

[73] Algoma submitted that a significant volume of plate imports from Ukraine, previously subject to the Plate II finding, were made at very low prices since that finding was rescinded and that this is one of the strongest indicators that dumping of plate from the Named Countries will resume in significant volumes at significant margins if the Finding is rescinded. The company suggested that the Plate II finding had prevented the dumping of most plate from Ukraine.⁶³ IPSCO noted that imports of plate products previously subject to the Plate II finding were made at prices undercutting the Canadian market and suggested that "Ukrainian producers have returned to their old habits of flaunting fair trade laws in order to regain market share."⁶⁴ IPSCO also noted that goods previously subject to the Plate II finding entered Canada in significant quantities at prices below average Canadian prices within weeks following the rescission of the finding and submitted that this indicates a continued interest in the Canadian market and an inability to compete at fairly traded prices. IPSCO also submitted that since the Plate II finding was rescinded in May 2004, Ukraine has exported or obtained import permits for about 64,000 tonnes of steel plate.⁶⁵

[74] Algoma submitted that following the Plate II finding, steel producers in Ukraine have also dumped other steel products into Canada, the most recent product being hot-rolled steel sheet on which the Tribunal issued an injury finding in 2001.⁶⁶

[75] With respect to other trade restrictions on steel plate from Ukraine, Algoma submitted that the U.S. recently continued an undertaking on goods from the country and imports into the U.S. have declined.⁶⁷ Algoma also noted that, since 2001, Ukrainian steel has been subject to a quota regime in the EU, which significantly restricts Ukrainian exports to the EU. Algoma maintained that the Ukrainian government has been unable to negotiate a new quota and, as a result, Ukrainian producers were looking for other export markets.⁶⁸ IPSCO noted that there were trade measures from at least nine countries on flat-rolled steel products from Ukraine and that if the finding on this country was rescinded, this would lead Ukrainian producers to immediately increase exports at dumped prices as they did after the Plate II finding was rescinded.⁶⁹

Parties Contending that Continued or Resumed Dumping and Subsidizing is Unlikely

India

[76] SAIL, the sole exporter to provide information for this expiry, did not submit case arguments or a reply submission, but the company did take a position opposing the continuation of the finding on India in its response to the ERQ for exporters. SAIL produces steel plate at three production facilities in India; the Bhilai Steel plant, the Bokaro Steel Plant and the Rourkela Steel Plant. SAIL stated that given that the original investigation only covered sales from the Bhilai Steel Plant (BSP), which is where subject goods sold to Canada originated, the information it provided for this review was only on behalf of that specific plant.⁷⁰

[77] According to SAIL, there has been a strong growing demand in India for hot-rolled steel plate that is expected to continue for some time. This growing demand is attributable to large-scale infrastructural development, high economic growth, and demand in the oil, gas and power sector.⁷¹ SAIL expects economic growth in the range of 6% to 8% per annum in the next few years and expects domestic consumption of steel plate to grow at a similar rate.⁷² SAIL submitted that given the increasing domestic demand for steel plate and the stable production capacity, the availability of steel plate for export markets is bound to decrease in the foreseeable future.⁷³

[78] With respect to likely export sales, SAIL stated, "available quantities for export may be sold in the neighbouring markets due to freight advantage."⁷⁴ Approximately 20% of the BSP production is expected to be available for the export market.⁷⁵ SAIL stated that its major markets consisted of South East and Far East Asia as well as Europe.⁷⁶ The company argued that it has not exported to Canada over the last five years and that it has no planned sales to Canada in the near future.⁷⁷

[79] In its submission to the Tribunal regarding its opposition to the initiation of an expiry review, SAIL raised the issue that most of the reports presented by the Canadian industry to back their arguments were actually referring to long products, which have no correlation with the subject goods. The company also argued that the Canadian domestic market was unable to meet its domestic demand and that imports into Canada are therefore imperative.⁷⁸

[80] With respect to the subsidizing of the goods, SAIL submitted that the recent reduction in India's Duty Entitlement Passbook Scheme (DEPB) rate for exports of steel products and the current price cap set by the Government of India for steel plate, when considering current international steel plate prices, were sufficient ground to rescind the subsidy finding.⁷⁹

CONSIDERATION AND ANALYSIS

[81] Subsection 76.03(7) of the SIMA requires the President of the CBSA to determine whether the expiry of the order or finding in respect of the goods of a country or countries is likely to result in the continuation or resumption of dumping or subsidizing of the goods. When making this determination, the President may consider the factors set out in subsection 37.2(1) of the SIMR.

Likelihood of Continued or Resumed Dumping

[82] Guided by the factors in the aforementioned 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:

• Factors related to the nature of the product and its market
  • Commodity nature of steel plate resulting in a highly price-sensitive market
  • Capital-intensive nature of steel production and its impact on production levels and export prices
• Changes in the global steel plate market conditions
  • Emergence/Immensity of the Chinese industry and its impact on the global and Canadian market
  • Changes in the global supply and demand conditions
  • Renewed global capacity expansion
  • Increased volatility
• Changes in the Canadian steel plate market conditions
  • Reduced domestic supply due to the withdrawal of a former producer from the steel plate market
  • Changes in the supply and demand conditions
  • Changes in the structure of the Canadian market characterized by the dominant position of imports
  • Increasing price pressure from imports / re-emergence of low-priced sources of steel plate imports
• Circumstances surrounding the steel plate producers in each of the Named Countries
  • Supply and demand conditions
  • Performance and likely future performance
    • current production volume and expansion plans
    • existence of excess capacity
    • degree of dependence or reliance on exports
    • general domestic and export pricing trends
    • likely availability of steel plate for shipments to Canada
    • volume and pricing to Canada during the POR
  • Existence of other relevant trade measures taken by Canada or by other jurisdictions
  • Risk of diversion
  • Likelihood of having to compete with the lowest-priced offerings in the Canadian market

[83] Before conducting a country-by-country analysis on the issue of the likelihood of continued or resumed dumping, there are certain issues that relate to the subject goods on a broader scale. In particular, factors related to the nature of the product and changes in the market conditions internationally and in Canada are discussed.

Factors Related to the Nature of the Product

[84] The significant number of anti-dumping measures involving steel products, both in Canada and several other jurisdictions, appears to be in large part related to the very nature of the product.

[85] With respect to steel plate in particular, as discussed in the Background section above, there were a total of five Canadian investigations between 1993 and 2004 into the dumping of steel plate, resulting in 26 findings involving 20 countries, with findings or orders still in place on imports from a dozen countries. The circumstances surrounding these findings indicate a pattern, in that after every finding of injurious dumping, alternative sources of low-priced imports are quickly found and sourced by importers, leading to a new investigation and additional findings. This is often referred to as "source switching". On occasion, after findings are rescinded, low-priced imports from these countries quickly reappear in the Canadian marketplace.

[86] The factors that relate to the nature of the product include the commodity nature of steel plate as well as the capital-intensive nature of steel production. When less than ideal market conditions exist, the combined effects of these two characteristics can have a significant impact on pricing. These are addressed as follows:

Commodity nature of hot-rolled steel plate

[87] Generally speaking, steel plate produced to a given specification and grade by a producer in a given country is physically interchangeable with a plate produced to the same specification and grade by any other producer in any other country. As such, subject goods compete among themselves and with like goods and share the same channels of distribution and the same potential customers. This characteristic implies that plate must compete in a market that is extremely price sensitive, where price is generally one of the primary factors affecting purchasing decisions from customers. Furthermore, because of this high degree of price sensitivity, prices in a given market tend to converge over time on the lowest price offerings.

Capital-intensive nature of steel production

[88] A second characteristic of the product involves the capital-intensive nature of steel production. As the Tribunal once noted "Steel mills are capital intensive with high fixed costs. In order to recover fixed expenses, steel mills must run at high levels of production capacity. When home market demand drops, producers will search out foreign markets to maintain capacity utilization to ensure that these fixed costs are recovered."⁸⁰ This is often referred to as the "economics of steel production". The implication on the likelihood of dumping is particularly apparent in conditions of overcapacity, as a producer may find it more beneficial to sell excess production in foreign markets at any price rather than reduce production, as long as the producer's variable costs are covered.

Changes in the circumstances surrounding steel plate market conditions

[89] Since the end of 2003, the international steel plate market has undergone significant changes. In particular, as noted by the Tribunal in its Orders and Reasons dated May 17, 2004, for the Plate II rescission, "In the past several months, particularly since the fourth quarter of 2003, growth in global demand for plate has accelerated in an unprecedented fashion."⁸¹ On this subject, the Tribunal emphasized China's "voracious demand" and the resulting pressure on other markets, where demand was also growing.⁸² The Tribunal further noted the strong market conditions for steel plate in other parts of Asia such as Korea and Japan, as well as the increased expenditures on infrastructures and construction forecasted for a number of economies, including India, the Middle East and the 2004 European Union accession countries, "which should result in an increased demand for plate in those markets in the near to medium term."⁸³ The Tribunal noted that unlike the past situation, "Asia, not North America, is the premier market for plate, being the world's largest and currently, the highest-priced market."⁸⁴

[90] The Tribunal also noted the substantial shortage of steel inputs and the resulting unprecedented increases in steel input costs, as well as the scarcity of ocean-going vessels to transport plate and raw materials.⁸⁵ In addition, the Tribunal noted reports of substantial shortages of plate across many markets.⁸⁶ Under such conditions, global steel prices hit record highs.⁸⁷ Also, the Tribunal described the availability for shipments to Canada as being constrained.⁸⁸

[91] For the remainder of 2004, the record contains evidence that the global steel plate market remained very strong although it has undergone and is still undergoing more changes.

China as a Key Factor

[92] The most significant of all changes in the international market since the Finding was put in place relates to the emergence of the Chinese steel industry. In fact, as discussed below, many of the other changes are actually a result of the emergence of China's booming demand and its weight in the global steel market.

[93] Led by very strong economic growth, particularly in steel consuming industrial sectors, Chinese steel consumption more than doubled during the POR.⁸⁹ Its consumption is now so strong that it accounted for 27% of global finished steel consumption in 2003 and is estimated to account for approximately 29% of world steel consumption in 2004.⁹⁰ In addition to being the world's top consumer of steel, China was also the world's top producer, with 23% of all production⁹¹, and the top importer. Representing a third of global economic growth in 2003, China also accounted for a disproportionably large share of world growth in demand for steel products.⁹²

[94] As a result of the surge in demand for steel products in China, the market has been characterized by massive shortages requiring huge imports - as high as approximately 40 million tonnes of crude steel in 2003.⁹³ In light of such figures, the weight and influence of China on the global steel market is evident.

[95] Triggered by the sizzling demand for steel products in China and elsewhere in the world, global steel production also rose significantly during the POR. According to figures published by the International Iron and Steel Institute (IISI), global crude production increased from 903.6 million tonnes to 964.8 million tonnes between 2002 and 2003, with China accounting for over 60% of the increase.⁹⁴ Crude production is expected to surpass 1 billion tonnes in 2004, with China still accounting for the majority of the growth.⁹⁵

[96] This rapid growth in production triggered other unprecedented changes with significant impact on the global market. In particular, the growth in production led to global shortages in raw materials such as iron ore, coke and scrap. While the material supply chain was being stretched to its limit, the cost of these materials increased dramatically and, as a result, so did the cost of producing steel products. These extra costs were being easily passed on to steel users in the form of raw material surcharges.⁹⁶ In addition, the increased raw materials deliveries were "constrained by congestion at ports and on railways, and by inadequate shipping capacities".⁹⁷ Under such conditions, there were many reports of shortages of steel plate and other steel products throughout the world earlier in 2004, and signs of panic buying and stock building (it is noted that such "double ordering" probably contributed to the shortages). Prices were rising very rapidly and, as reported by MEPS (International) LTD. (MEPS), availability was replacing price as the main driver in steel markets.⁹⁸

[97] Investments in the Chinese steel sector soared by 96.6% in 2003, planting the seed for overproduction and irrational economic structure, according to Ma Kai, China's minister for Development and Reform Commission.⁹⁹ Similar investments also characterized other industrial sectors. In the first quarter of 2004, led by high demand, by soaring prices and profits, and by easy access to capital, fixed asset investments were up again, by as much as 43% year-on-year, compared to 26.7% for the same period the previous year¹⁰⁰, leading to serious concerns that the runaway investment bubble was overheating the economy, particularly in the industrial segment of the economy, and creating fears of an economic hard landing.

[98] By April 2004, concerns over the sizzling Chinese economy led China's central government to take measures to slow down growth in order to attempt to secure a soft landing. For example, "national and local banks were instructed to curb lending as part of a string of measures to calm soaring investments in plants and equipments. [...] The council also called for a review of ongoing investment projects that require metals and other building materials, such as commercial offices and shopping malls."¹⁰¹ A series of measures were announced in late April 2004 and more were announced in late August to further reduce the risk of a crash in industries such as steelmaking.¹⁰²

[99] Following the Chinese government's measures and under fears that the bubble would burst, China's steel industry started cooling off. Immediately after the measures were taken, demand dropped and prices in China also dipped significantly. While it was previously reported that China was the highest-priced market for steel, there were reports in July 2004 that international steel prices were "some 30% higher than China's internal market prices."¹⁰³ With respect to flat-rolled steel products, Chinese domestic prices were reported to be $100 (US) per tonne CFR below international market prices.¹⁰⁴ In light of a reduced demand in China and better conditions in the international market, Chinese imports of steel declined and its exports increased.¹⁰⁵

[100] The cooling of the Chinese steel market between April and July 2004 can be considered a market correction. However, whether or not a hard landing of the Chinese economy has been avoided is a matter of opinion. On one hand, some market players and observers are playing down worries over an overheating economy. For example, several industrial leaders and government officials in China now believe that the macroeconomic controls were successful at curbing the overheated investments and that the steel sector is now rolling on a sound track.¹⁰⁶ Yet, investments still grew by 40% in the first nine months of 2004¹⁰⁷, which suggests that over-investments are still occurring.

[101] On the other hand, as one economist described, "the investment boom has gone to such excess that a subsequent bust can hardly be ruled out."¹⁰⁸ Despite the recent steel shortages in China, MBR believes that the balance of supply and demand for steel products in China is to switch around in 2005, with supply surpassing demand. In fact, in one of its analyses, it predicted that a severe downturn could occur in China in the 2^nd or 3^rd quarter of 2005 because of capacity expansions within China itself resulting in massive internal oversupply.¹⁰⁹

[102] At the end of the POR, China was still a net importer of steel plate and in the 2^nd half of 2004, some traders were still claiming that it was hardly available.¹¹⁰ It is estimated that about 2 million tonnes will be imported in China in 2004.¹¹¹ However, evidence on the record points to substantial capacity additions.¹¹² According to WSD data, steel plate capacity is expected to rise from 21.42 million tonnes in 2004 to 30.82 million tonnes in 2005, while consumption is only expected to increase from 26 million tonnes to 28 million tonnes.¹¹³ Another source estimates that 23 new plate rolling mills with a capacity of 17 million tonnes were installed in China in 2003 and that an additional 15 new plate mills with a capacity of 17 million tonnes were due to be completed in 2004.¹¹⁴ Such figures, if they materialize, provide a clear picture of the expected switch in the supply/demand balance. Overall, it is expected that Chinese crude steel capacity would grow by slightly less than 100 million tonnes between 2003 and 2005.¹¹⁵

[103] The CBSA recognizes the increasing risk of an oversupply of steel production capacity in China in the foreseeable future and the potential negative effect on the global market in general and the Canadian steel plate market in particular. Such a point of view is also reflected in a MBR analysis, in which the following opinion regarding the impact of the expected oversupply condition in China was stated: "[i]t is our view that any downturn in the Chinese steel demand will result in massive internal oversupply, a surge in exports at any prices, which [...] will be undertaken in a chaotic and hurried manner reminiscent to the surge in CIS exports in the early and mid-1990s. The response will be similar - a wave of anti-dumping activities that will be aimed at Chinese exporters, but will impact all emerging market steel producers."¹¹⁶ An oversupply in China would significantly ease the global supply condition and would mean that, to maintain production volume, producers who used to export significant volume of steel to China would have to find new markets for their products while having to compete with the additional volume coming out of China.

[104] It could be argued however that certain factors may limit the timing and/or extent of the expected oversupply. In particular, there are possible impediments on any further output increases in China, due to such factors as shortages in raw materials, particularly from domestic sources (although additional supply may soon be available globally), shortages in electricity, scarcity of water (needed to cool down the plants and products), lack of availability of vessels to ship the imported raw materials and inadequate transport infrastructure in the country.¹¹⁷ In other words, it is possible that the growth in production of steel may not be able to immediately match the growth in capacity.

[105] The only sure aspect of the likely state of the Chinese steel plate market in the foreseeable future is its continued weight and its increasing uncertainty and expected volatility, particularly because of an excess growth in production capacity and uncertain demand conditions. Given that China accounts for a disproportionably large share of world growth in both supply and demand for steel products, its impact, whether positive or negative, cannot be ignored.

Changes in Rest of World

[106] In the meantime, steel consumption in the rest of the world has also been on the rise, driven not only by Chinese growth, but also by economic recoveries in the U.S., the EU and Japan that started late in 2003.¹¹⁸ Furthermore, as the shortage in raw materials is a global event, so was the related dramatic price increase phenomenon.

[107] With respect to the North American market, MEPS noted that nowhere during the recent boom in steel prices have values soared faster than in the U.S., to levels not seen in the previous 25 years.¹¹⁹ While the Tribunal indicated at the time it rescinded the Plate II finding that Asia was now the highest-priced market for plate rather than the U.S.,¹²⁰ the situation reversed again since the "correction" in China, discussed above, started in early 2004. For now, high prices in the U.S. have been sustained by strong demand and limited supply.¹²¹

[108] While strong demand is expected to continue until mid-2005, there are signs that the tightness is easing and that the American market is at its peak. In October 2004, analysts from MBR noted that flat product prices appear to have peaked in the U.S., with downward pressure on prices. They noted that buyers were reporting easier availability of steel products and were actually negotiating on price rather than just availability. While demand remains strong, the increased availability and price pressure were the result of increasing imports.¹²² According to data published by the U.S. International Trade Commission, imports increased by almost 50% for the first nine months of 2004 compared to the same period a year ago.¹²³

[109] Although not to the same extent as in China, steel production capacity outside China is also on the rise, stimulated by the recent high prices and supply tightness. In this regard, MBR identified almost 50 million tonnes of new capacity outside China to come on stream over the next three years.¹²⁴ MBR described this growth as "the first period of substantial capacity additions to come on stream after the Asian crisis of 1997, which triggered five years of low prices."¹²⁵ It also suggested "[t]he vast majority is also expected to arrive in 2005/2006, just when we expect that steel prices will be falling, as Chinese and global demand growth slows, and Chinese net imports fall." It is noted that in light of the substantial expenditures in fixed capital equipment involved in such projects, producers cannot easily stop the expansion projects that are underway in the event that market conditions suddenly change.

Changes in the Canadian Steel Plate Market

[110] The recent conditions in the Canadian steel plate market were well in line with the North American and global conditions, characterized by tight availability and unprecedented high price levels.

Demand Conditions

[111] As for the steel industry in general, demand in the Canadian plate market is highly cyclical in nature and sensitive to general economic conditions (North American and global conditions as well) and to conditions in particular industrial sectors such as construction, oil and gas, heavy machinery, agriculture and transport/shipping.

[112] The current tight conditions in the domestic market appear to be more a function of tightness in supply than in an improvement in demand. The apparent Canadian market data compiled by the CBSA indicates that despite the reported tightness of the market, Canadian consumption for steel plate was stronger at the start of the POR than towards the end of the POR.

[113] On a shorter-term basis, domestic demand has been bullish during the first three quarters of 2004 compared to the same period in the previous year.¹²⁶ Robust demand conditions can be expected to continue for at least part of 2005, but in light of the current volatility in the marketplace, predictions for farther than the short term are uncertain.

Supply Conditions

Domestic:

[114] The most significant change in the Canadian market occurred on the supply side, with the withdrawal of one of the three Canadian producers from the market. In this regard, at the start of the POR, Stelco's production and sales of certain hot-rolled steel plate represented a large proportion of Canadian apparent consumption. ¹²⁷ Stelco reduced its steel plate capacity utilization rate in 2002,¹²⁸ idled its plate mill in April 2003 and closed it permanently in early 2004 while under bankruptcy protection.¹²⁹

[115] Prior to the closure of its plate mill, Stelco was the only producer in Canada that was producing and supplying plate in thicker gauges. While Stelco used to produce plate of thicknesses up to 5.25 inches, Algoma and IPSCO focused their production on thicknesses up to about 3 inches. In its response to the Producer ERQ, Algoma stated that while the company did not produce or sell steel plate over 3 inches thick for several years, because of limited demand and the fact that they could be produced by Stelco, the company was now increasing its thickness range to include thicknesses up to 4 inches.¹³⁰ Similarly, IPSCO stated that it was now capable of supplying plate in thicknesses up to 4.25 inches.

Imports:

[116] On the import side, sales from all imported sources increased by over 39% between 2001 and 2003 despite a decrease of almost 15% in apparent consumption. While total consumption improved slightly during the first 9 months of 2004 compared to the same period the previous year, the volume of imports surged by an additional 34%.¹³¹

[117] Given Stelco's exit from the market, an increase in imports was to be expected in order to fill the void on the domestic supply side. It appears that the vast majority if not all of Stelco's usual volume of sales were captured by imports. However, evidence on the record appears to indicate that such imports were imperative.¹³² Given the evidence of shortages of steel plate in the Canadian market, particularly for thicker gauges and certain high grades, and in light of the increase in Canadian exports of plate to the U.S. of about 25% since the beginning of the POR¹³³, evidence on the record seems to confirm that the increase in imports was inevitable.

[118] Nevertheless, even if the Canadian industry was unable to maintain its domestic market share by capturing some of Stelco's past volume, these figures do show significant changes in the structure of the Canadian market. With the majority of the Canadian consumption now fulfilled by imports, domestic producers may, in the future, be much more vulnerable to the pressures of import pricing given their increased share of the Canadian market. Also, having a larger share of the market supplied by an increasing number of players, particularly from offshore sources, may increase price competition and the risk that the average prices converge toward the lowest offerings, especially once the market returns to an oversupply condition.

[119] While the average pricing of steel plate in the Canadian market has been more or less stable between 2001 and 2003, prices increased significantly in 2004. As discussed earlier, this unprecedented price increase is not limited to the Canadian market but rather a global phenomenon driven, for the most part, by Chinese demand for imports and the resulting raw material shortages and unprecedented increase in their costs.

[120] On the other hand, import data compiled by the CBSA suggests increasing price pressure from steel plate imports, particularly from certain exporters. In this regard, imports of steel plate from certain countries whose combined volume represents about 20% of all imports of hot-rolled steel plate into Canada during the first nine months of 2004, were priced 13% to 44% lower than the average price of Canadian producers during that period.¹³⁴ Two of these countries were previously named in the Plate II finding, which was rescinded in May 2004, and have since reemerged among the lowest-priced sources of imports. Should the Finding be rescinded, producers in the Named Countries may have to compete with the lower price offerings to regain market share.

[121] The analysis of the factors relating to each of the Named Counties individually follows.

Analysis by Country

Brazil

[122] Two steel plate producers from Brazil, Companhia Siderurgica Paulista (Cosipa) and Usiminas Siderurgicas De Minas Gerais S.A. (Usiminas), co-operated with the CBSA during both the original investigation and the subsequent re-investigation, and have had methodologies to determine normal values during the entire POR. The producers did not participate for purposes of this expiry review.

[123] Market conditions for Brazilian plate producers were quite favourable during the latest portion of the POR. The country's domestic demand is reported to be strong and growing.

[124] Information on the record confirms that Brazil does have a substantial excess steel production capacity. According to IISI data, Brazil produced 31.1 million tonnes of steel in 2003 but consumed only 15.9 million, relying on exports for almost half of its production. The IISI ranked Brazil in the top 10 largest producers in the world and as the fourth largest net exporter.¹³⁵ The Brazilian Steel Institute estimated that total crude production should increase by approximately 4% in 2004, to reach 32.39 million tonnes.¹³⁶ It also projected strong growth in domestic steel consumption, which it estimated to rise 10.2%. Based on these projections, the Brazilian producers will still rely on exports for about 46% of their production.

[125] Metal Bulletin reported the Usiminas group's (which includes Cosipa) current heavy plate capacity at 2 million tonnes¹³⁷. Brazilian production and trade figures reported by MBR indicate that 43% of the Brazilian plate production in February 2004 was exported with relatively no imports,¹³⁸ a proportion that seems reasonable given the overall proportion of exported steel products. If applied to the group's reported capacity of 2 million tonnes, the estimated heavy plate overcapacity is significantly larger than the entire Canadian consumption of certain steel plate.

[126] Furthermore, there are several reports of significant expansions of steel capacity in Brazil planned for the foreseeable future. For example, there are reports of plans to double the Brazilian national steel capacity by 2010¹³⁹ and others indicating that the Usiminas group is considering expanding its plate mill.¹⁴⁰ In addition, MBR also reported that in the first half of 2004, the Usiminas group reduced production of slab and increased production of plate and other products.¹⁴¹ It also reported that most of the increase in plate production went to exports. In fact, the group accelerated its exports by over 50% during that period.¹⁴² In light of their proximity to scarce resources, it is noted that Brazilian steel producers are less constrained by shortages in raw materials and ocean vessel availability.

[127] In addition, Brazilian steel producers have exhibited a history of dumping steel products. With respect to steel plate in particular, Brazil was previously subject to the 1993 "Plate I" finding, which was rescinded in 1998. The very next year, the CBSA initiated the "Plate IV" investigation and determined that Brazil had again dumped steel plate in the Canadian market. Steel plate from Brazil is also subject to anti-dumping measures in the U.S., while other similar carbon steel products are subject to anti-dumping measures in Canada, the U.S. and Argentina.¹⁴³ It is noted that on September 13, 2004, the U.S. Department of Commerce (DOC) concluded a sunset review (expiry review) of its anti-dumping measures with respect to certain hot-rolled flat rolled carbon-quality steel products imported from Brazil and determined that revocation of the orders would likely lead to continuation or recurrence of dumping at levels above 43% for both Usiminas and Cosipa.¹⁴⁴

[128] The CBSA notes that very little subject goods from Brazil were imported into Canada while the Finding has been in effect¹⁴⁵, compared to 13,438 tonnes that were shipped during the 12-month period of investigation during the original investigation.¹⁴⁶ Producers in Brazil have ceased shipments to Canada since 2001. Given that both Usiminas and Cosipa have methodologies in place for the calculation of normal values, such significant decline in import volume from Brazil since the issuance of the Finding may be an indication that the producers are unable to compete in Canada with the measures in place.

[129] As was discussed earlier in this report, steel plate is a commodity product whose market is highly price sensitive. It was also noted that the structure of the Canadian market has recently changed, allowing imports to take over a dominant proportion of Canadian steel plate consumption, increasing price competition from several foreign sources. For example, the record indicates that steel plate from certain countries were imported in 2004 at prices that are some 40% lower than the average price of the Canadian domestic producers. The record indicates that the conditions characterizing the Brazilian steel plate industry increases the likelihood that the Brazilian steel plate exporters will have to compete with these lower priced imports to regain market share in Canada in absence of the Finding. The factors characterizing the Brazilian steel plate industry include the substantial excess plate capacity and planned expansion, resulting in a highly export-dependant industry, the producers' history of dumping steel plate and other similar products, which may be indicative of their future behaviour, and an apparent inability to compete in Canada at normal values.

[130] Based on the evidence contained on the record including: the substantial excess production capacity and the planned expansions resulting in a high dependency on exports to maintain utilization rates, a clear and continued pattern of dumping steel plate and other steel products in certain export markets and particularly in Canada, which may be indicative of their future behaviour, an apparent inability to compete in Canada with the measures in place, combined with the presence of low-priced imports from other countries with which Brazilian exporters will likely have to compete with to secure sales to Canada, the President determined that the expiry of the Finding was likely to result in the continuation or resumption of dumping into Canada of certain steel plate originating in or exported from Brazil.

Finland

[131] The Finnish steel plate industry consists of only one known producer, Rautaruukki Oyj (Rautaruukki). The producer did not co-operate with the CBSA during the original investigation nor did it co-operate during the subsequent re-investigation. As a result, normal values for Finland during the entire POR have been determined pursuant to a ministerial specification. The ministerial specification originally specified that the normal value should be determined based on the export price plus an amount equal to 135.8% of that export price. The advance over the export price has been revised to 80.2% as of January 15, 2002, the date of the conclusion of the re-investigation of normal values and export prices.¹⁴⁷

[132] Rautaruukki has an estimated plate production capacity of 600,000¹⁴⁸ to 750,000¹⁴⁹ tonnes per year. According to the company's annual report and as reported by Metal Bulletin, 97% of the producer's sales are made within Europe, thus leaving only 3% for all other markets.¹⁵⁰ If this same proportion is applied to its steel plate capacity, it could be estimated that between 18,000 tonnes and 22,500 tonnes per year of steel plate may be available for exports outside Europe. Given the choice of other export destinations (e.g. Asia, the U.S., South America, Middle East, Africa, etc) for this relatively small available volume, it is rather unlikely that a significant portion of this volume would find its way into Canada in the near to medium term.

[133] During the POR, a small volume of subject plate from Finland was imported into Canada.¹⁵¹ The average import price per tonne of these shipments (not including anti-dumping duty) was significantly higher than the average Canadian price levels.¹⁵² The Finnish imports were assessed anti-dumping duty based on a ministerial specification in the manner explained above. The assessment of duty was therefore inevitable, despite the high export selling prices.

[134] According to industry reports contained in the record, common grade plate FOB prices in the EU averaged in the $700 per tonne range in October 2004 and appear to be rising.¹⁵³ The high value of the Finnish steel plate exported to both Canada and to the U.S., where the average price of the Finnish imports was above $900 (US)¹⁵⁴ in 2004, do not suggest that they are traded at prices that are below the likely domestic prices of Rautaruukki (even if the products exported to Canada are higher-priced specialized products.)

[135] Evidence on the record suggests that the low volume of imports of subject goods from Finland since the Finding has been in place may be attributed to the producer's strategic focus on Europe as a core market rather than an inability to compete in the Canadian market with the measures in place. In addition, the producer's annual report indicates that outside its core market area, its Metals Products Division is focusing mainly on marketing special products.¹⁵⁵ In light of the fact that the company is likely only exporting higher-end products to Canada and given the high prices of its imports during the POR, it is unlikely that Rautaruukki is competing with or will likely have to compete with the lowest priced imports in the Canadian market. In fact, the willingness of the importer to pay substantial duty on top of an already high price for the Finnish plate may be an indication of price inelasticity for the Finnish products.

[136] Regarding the likely future performance of the Finnish producer, MBR reported that Scandinavia, along with the United Kingdom and the new EU economies, is experiencing the strongest consumption growth in the EU.¹⁵⁶ The addition of the ten Central and Eastern Europe countries to the EU may also add to the growth prospect given their dynamic economies.

[137] In addition, given the very high concentration of Rautaruukki's core market within Europe, the risk posed by a possible Chinese slowdown or by a possible excess steel plate supply in China in the foreseeable future is unlikely to result in a diversion of Finnish steel plate. Except for a finding by the U.S., there are no other known anti-dumping measures in place against steel plate or other similar products from Finland.¹⁵⁷

[138] Based on the evidence contained on the record including: the minimal availability of Finnish steel plate for sales outside its core European market, the high prices of its exports to both Canada and the U.S., the low risk of diversion to Canada and the unlikelihood of having to compete with lower-grade steel plate and the lowest-priced imports from other countries the President determined that the expiry of the Finding was unlikely to result in the continuation or resumption of dumping into Canada of certain steel plate originating in or exported from Finland.

India

[139] The Indian steel plate industry consists of five known producers. During the original investigation, the producer that had exported to Canada during the period of investigation, Steel Authority of India Limited (SAIL), co-operated with the CBSA and normal values were issued to the producer. These values were in place until the conclusion of the subsequent re-investigation of normal values on January 15, 2002. Since that date, given the lack of co-operation by any producer in India during the re-investigation of normal values and export prices, normal values have been subject to a ministerial specification. The ministerial specification specifies that the normal value shall be determined based on the export price plus an amount equal to 80.2% of that export price. SAIL provided a response to the CBSA's ERQ for purposes of this expiry review, as did the government of India (mostly subsidy related).

[140] In line with the global steel plate market trends, Indian producers have also enjoyed strong conditions in their domestic market. Based on statistics presented by SAIL and by the Government of India (GoI), Indian domestic steel plate consumption surged by 18.4% between the 2001-2002 and the 2003-2004 fiscal years (April to March), and by an additional 13.4 % in the first half of the current fiscal year.¹⁵⁸ In this regard, consumption of steel plate increased from 1.8 million tonnes to 2.3 million tonnes during that period and is estimated at approximately 2.6 million tonnes for the current 2004-2005 fiscal year.¹⁵⁹ The two parties submitted that the strong growth could be attributed to strong economic growth in general, to strong growth in steel-intensive sectors of construction and manufacturing, and to large-scale infrastructural development in India. On the supply side, the CBSA estimates capacity to be approximately equal to the 2.4 million tonnes of domestic production estimated for the 2004-2005 fiscal year.¹⁶⁰

[141] Based on the above analysis, it appears that the Indian steel plate industry is currently not in a position of overcapacity and may not be dependant on exports. In fact, according to figures presented by the GoI, India has been a net importer of steel plate during the entire POR and the volume of net imports has recently increased. ¹⁶¹ However, despite India's net import position, exports remain high at 355,000 tonnes during the 2003-2004 fiscal year¹⁶².

[142] With respect to SAIL in particular, the producer indicated that its Bhilai plate mill was operating at 101% capacity in 2003-2004 and even higher in the current year, thus leaving no unused capacity for increased production and increased exports.¹⁶³ The producer has plans to export approximately 20% of its steel plate production for the current fiscal year.¹⁶⁴

[143] Despite the positive outlook for growth in steel demand in India for the foreseeable future, it is noted that there is also evidence of massive capacity expansion planned by Indian steel producers. For example, MBR identified a total of 8.1 million tonnes of planned expansions in India between 2004 and 2008, mostly related to flat products.¹⁶⁵ With respect to steel plate in particular, the record contains reports of a plate capacity expansion of 1 million tonnes by Jindal Iron and Steel Company Limited (Jindal) as well as reports that SAIL has plans for a massive expansion of its Bhilai plate mill.¹⁶⁶ It is noted that the 1 million tonne expansion of Jindal's plate production capacity alone represents a significant increase in India's capacity; about 40%. Even when taken in the context of the current tightness and the strong rate of growth in Indian domestic consumption, such massive capacity expansion might be enough to reverse the supply/demand balance in the foreseeable future, resulting in an increased reliance on exports.

[144] An incentive to export steel plate at low prices may exist despite tightness in the Indian steel plate market, which may be attributed to the export subsidies provided to exporters, as discussed later in this report. In order to maintain benefits under certain subsidy programs (such as the Export Promotion Capital Goods Scheme for example¹⁶⁷), exporters must maintain a certain volume of exports. Despite strong domestic demand and even if international prices were higher than the Indian domestic prices, the producers have an incentive to export steel plate at any price, even below their own domestic prices, to secure export sales and maintain their export status and the associated financial benefits. To illustrate this, the record contains evidence suggesting that SAIL may be selling steel plate in its export markets at prices that are below those in its domestic market, despite the current unprecedented strong conditions in the international market.¹⁶⁸

[145] Furthermore, the record contains certain evidence of an established pattern of dumping steel plate and other similar products. In this regard, anti-dumping measures are in place in Canada and the U.S. with regard to steel plate, in addition to similar products in Canada, the EU, the U.S. and Thailand.¹⁶⁹

[146] In addition, the restriction of the U.S. market to steel plate from India, where the goods are also subject to both anti-dumping and countervailing measures, limits the Indian producers' potential export destinations and thus may increase the likelihood that the goods be diverted to Canada as an alternative market in absence of the Finding, particularly if demand for Indian steel plate slows in Asia.¹⁷⁰

[147] There have been no imports into Canada of steel plate from India since the Finding.¹⁷¹ In the 12-month period of investigation leading to the Finding, over 24,000 tonnes of steel plate from India were imported into Canada. Evidence on the record also indicates a similar pattern with regard to steel plate imports from India in the U.S. market since the imposition of anti-dumping measures in that country.¹⁷² The lack of imports from India since the Finding has been in place may be an indication that the Indian producers are unable to compete in Canada with the measures in place.

[148] Finally, as was discussed earlier in this report, steel plate is a commodity-like product whose market is highly price-sensitive. It was also noted that the structure of the Canadian market has recently changed, allowing imports to take over a dominant proportion of Canadian steel plate consumption, thereby increasing price competition from several foreign sources. For example, the record indicates that steel plate from certain countries are being imported in 2004 at prices that are some 40% lower than the average price of the Canadian producers. The record indicates that the conditions characterizing the Indian steel plate industry increase the likelihood that the Indian steel plate exporters will have to compete with these lower priced imports to regain market share in Canada absent the Finding. These factors characterizing the Indian steel plate industry include plans for massive steel plate capacity expansions that may result in increased export reliance, the incentive to export resulting from export subsidies, evidence of apparent dumping of steel plate by a major Indian producer in its export markets, an established pattern of dumping steel products, a restricted access to the U.S. steel plate market and an apparent inability to compete in the Canadian market with the measures in place.

[149] Based on the evidence contained on the record including: reports of massive steel plate capacity expansions that may result in increased export reliance, the apparent incentive to export at any price resulting from export subsidies, evidence of apparent continued dumping of steel plate by a major Indian producer in its export markets, an established pattern of dumping steel products by Indian steel producers, a restricted access to the U.S. steel plate market and an apparent inability to compete in the Canadian market with the measures in place, combined with the presence of low-priced imports from other countries with which Indian exporters would likely have to compete with to secure sales to Canada, the President determined that the expiry of the Finding was likely to result in the continuation or resumption of dumping into Canada of certain steel plate originating in or exported from India.

Indonesia

[150] The steel plate industry in Indonesia consists of three known producers; PT Krakatau Steel (Krakatau), the largest of the three, PT Gunawan Dianjaya Steel (Gunawan) and PT Gunung Raja Paksi (Gunung). Following the original investigation both Krakatau and Gunawan were issued normal values. These normal values were in place until the conclusion of the subsequent re-investigation of normal values and export price on January 15, 2002. Since that date, given the lack of co-operation by any producers in Indonesia during the re-investigation, normal values have been subject to a ministerial specification. The ministerial specification specifies that the normal value shall be determined based on the export price plus an amount equal to 80.2% of that export price. No producers from Indonesia took part in this expiry review. However, since two producers co-operated during the recent review of the amounts of subsidy, that is, Gunawan and Gunung, the record contains limited information from these Indonesian producers.

[151] According to evidence on the record, demand for steel products in Indonesia has been rather stagnant since the Finding has been in place.¹⁷³ Yet, there are reports of massive expansion by the largest producer, Krakatau, which plans to more than double its capacity by 2008.¹⁷⁴

[152] A review of production and sales data provided by the two smaller producers as part of the recently concluded review of the amounts of subsidy indicates that the average export prices of steel plate of one of the two companies was significantly lower than its average domestic prices, suggesting that it may be dumping steel plate in its export markets.¹⁷⁵ The information reviewed related to the period of April 1, 2003 to March 31, 2004.

[153] In the 12-month period of investigation leading to the Finding, over 57,000 tonnes of steel plate from Indonesia were imported into Canada. Imports from Indonesia have ceased since the Finding.¹⁷⁶ The lack of imports may suggest an inability on behalf of the Indonesian producers to compete in the Canadian market with the measures in place. Similarly, the evidence on the record indicates that steel plate imports from Indonesia into the U.S. market also ceased¹⁷⁷ since anti-dumping and countervailing measures were taken by the U.S.¹⁷⁸ Furthermore, Indonesian producers were also recently found to be dumping steel plate in the Australian market.¹⁷⁹ The country was also found to be dumping other hot-rolled steel products in the U.S. as well as in Thailand.¹⁸⁰ The history of dumping exhibited by the Indonesian producers may be indicative of their future behaviour in the Canadian market if the Finding is rescinded.

[154] A corporate brochure from Gunawan contained on the record indicates that the company has a steel plate capacity of 400,000 tonnes per year¹⁸¹, while its production and sales data covering a period of 12 months indicates much lower volume of steel plate sales¹⁸², suggesting substantial unused capacity. This indicates that Gunawan has the capacity to increase its steel plate production.

[155] As was discussed earlier in this report, steel plate is a commodity-like product whose market is highly price sensitive. It was also noted that the structure of the Canadian market has recently changed, allowing imports to take over a dominant proportion of Canadian steel plate consumption, thereby increasing price competition from several foreign sources. For example, the record indicates that steel plate from certain countries are being imported in 2004 at prices that are some 40% lower than the average price of the Canadian producers. The record indicates that the conditions characterizing the Indonesian steel plate industry increases the likelihood that the Indonesian steel plate exporters will have to compete with these lower priced imports to regain market share in Canada if the Finding is rescinded. These factors characterizing the Indonesian steel plate industry include a stagnant domestic demand, planned expansion of steel plate capacity in Indonesia and apparent unused capacity, the closure of major markets to Indonesian steel plate producers, evidence that a producer may be dumping steel plate in its export markets, and an established pattern of dumping steel plate in export markets.

[156] Based on the evidence contained on the record including: a stagnant demand in Indonesia since the Finding has been in effect, the massive expansion of steel plate capacity in the foreseeable future, evidence of substantial unused steel plate capacity, the closure of major markets to Indonesian steel plate producers, a clear and continued pattern of dumping steel plate in export markets, combined with the presence of low-priced imports from other countries with which Indonesian exporters will likely have to compete with to secure sales to Canada, the President determined that the expiry of the Finding was likely to result in the continuation or resumption of dumping into Canada of certain steel plate originating in or exported from Indonesia.

Thailand

[157] There are three known steel plate producers in Thailand, although only one, LPN Plate Mill Public Co. Ltd. (LPN), is known to have shipped to Canada prior to the Finding. At the time of the original investigation, LPN co-operated with the CBSA and was issued normal values, which remained in effect until the conclusion of the subsequent re-investigation of normal values on January 15, 2002. Since no producers from Thailand co-operated with the CBSA during the re-investigation, normal values have since been determined by authority of a ministerial specification. The ministerial specification specifies that the normal value shall be determined based on the export price plus an amount equal to 80.2% of that export price. No producers from Thailand took part in this expiry review. A submission was received by the Royal Thai Government (RTG), although this response relates mostly to the subsidy finding.

[158] Evidence on the record suggests that Thailand is not in a position of oversupply with respect to steel production. In fact, according to the figures from South East Asia Iron and Steel Institute (SEAISI), 3.5 million tonnes of crude steel were produced in 2003 while 11 million tonnes were consumed.¹⁸³ SEAISI data also indicate net steel imports totalling almost 8.5 million tonnes in 2003.¹⁸⁴ There are reports on the record stating that while demand for hot-rolled products in 2004 is expected to stand at 5.6 million tonnes and at 6 million tonnes in 2005, the three largest producers could only produce approximately 3.2 million tonnes, indicating a shortage of 2.4 million tonnes.¹⁸⁵ With respect to steel plate in particular, import and export statistics provided by the RTG indicate that the total exports of steel plate for the first nine months of 2004 were a meagre 5,700 tonnes worldwide. Meanwhile, 15 times that amount was imported.¹⁸⁶ Such immaterial volume of exports suggests that significant volumes of steel plate imports into Canada from Thailand are not likely to occur in the foreseeable future. In addition, since there are no known anti-dumping measures or other trade measures on steel plate from Thailand in any other jurisdiction, there is no apparent risk of diversion.

[159] With regard to the performance and the likely future performance of the steel plate industry in Thailand, the CBSA notes that Thailand's domestic consumption of steel products increased significantly since the Finding. In fact, SEAISI figures indicate an increase of approximately 67% in consumption rates since 2000, as well as a 6% decrease in exports.¹⁸⁷ These figures suggest that any increase in output during that period was entirely absorbed by the domestic market, which still remains in shortage. Despite reports of planned capacity additions in Thailand, the evidence on the record indicates that the Thai domestic industry will likely be able to continue to absorb the increased output in the foreseeable future. In addition, the reported major expansion projects relate to plans for the next 15 years, with the first phase relating to expanding the capacity for production of non-subject goods.¹⁸⁸

[160] There were no exports to Canada of subject goods from Thailand during the POR. The lack of imports into Canada may be explained by the minimal availability of steel plate for export, as suggested by the low volume of steel plate exports from Thailand to any market, rather than by an inability to compete in the Canadian market with the measures in place.

[161] With respect to the history of dumping, it is noted that Thai exporters were not found to be dumping steel plate in any other jurisdictions, although there are measures in place with respect to a similar product in the U.S. and Australia. All measures occurred after the Thai economic crisis that resulted in the collapse of the Thai currency and a general contraction of the Thai economy in the late nineties.¹⁸⁹ As discussed above, evidence on the record suggests that demand for steel products in Thailand has since rebounded. In light of the changed circumstances, the measures currently in place may not be indicative of the Thai producers' likely future behaviour.

[162] Given the apparent unavailability of subject goods from Thailand for export in the near to medium term, it is unlikely that any significant volume of imports from Thailand will find its way into Canada. It is more likely that the small volume of Thai steel plate that may be available for exports would be sold to neighbouring markets where freight costs may be minimized. As such, it seems unlikely that the Thai exporters will be competing with the lowest-priced offerings in order to regain market share of the Canadian market.

[163] Based on the evidence contained on the record including: the steel plate under supply condition and the minimal availability of steel plate for export, the surge in domestic steel consumption in Thailand since the Finding, the apparent ability of its domestic market to absorb additional output in the foreseeable future, the low risk of diversion to Canada and the unlikelihood of having to compete with the lowest-priced imports from other countries, the President determined that the expiry of the Finding was unlikely to result in the continuation or resumption of dumping into Canada of certain steel plate originating in or exported from Thailand.

Ukraine

[164] The Ukrainian steel plate industry consists of three known producers. At the time of the original investigation, in light of the lack of full co-operation, normal values for Ukraine were determined by ministerial specification. The ministerial specification specified that the normal value should be determined based on the export price plus an amount equal to 135.8% of that export price.¹⁹⁰ During the subsequent re-investigation of normal values and export prices, one of the three known producers, JSC Azovstal Iron and Steel Works (Azovstal), co-operated with the CBSA. Despite Azovstal's full co-operation, the CBSA was unable to use the producer's information to determine normal values, which were therefore determined under authority of a ministerial specification based on the weighted average normal value of like goods as determined in surrogate countries. For the other producers, the ministerial specification specifies that the normal values shall be determined based on the export price plus an amount equal to 80.2% of that export price. These values have been in place since the conclusion of the re-investigation on January 15, 2002. ¹⁹¹

[165] The scope of the Finding in respect of the subject goods from Ukraine differs from the scope of the Finding in respect of the subject goods from the other five countries that are subject to this expiry review. The limited scope with respect to Ukrainian subject goods is explained by the fact that goods from the country were partially included in the Plate II finding of 1994 at the time the Plate IV investigation was initiated. The Plate II finding covered plate in thicknesses up to 4 inches and did not cover certain Pressure Vessel Quality (PVQ) plate. While the Plate II finding was in place, Ukrainian exporters continued to injuriously dump certain steel plate that were excluded from the Plate II finding. Therefore, the Plate IV investigation and subsequent Finding relate to the thicknesses and specifications not covered by the Plate II finding (i.e. plate in thicknesses between 4 inches and 5.25 inches and certain PVQ plate). The Tribunal rescinded the Plate II finding in May 2004.

[166] Evidence on the record indicates the existence of a substantial steel production overcapacity in Ukraine. The IISI ranks Ukraine as the world's third largest net exporter of steel, with net exports of 25.2 million tonnes, or almost 70% of its production.¹⁹² With respect to steel plate in particular, while the record does not contain full data on the country's total production capacity, there is evidence of approximately 3.6 million tonnes of steel plate capacity for two producers.¹⁹³ Already substantial, this figure does not include the capacity of the other known producer. MBR referred to Ukraine as having the largest spare plate capacity in the world.¹⁹⁴ Not only is this excess capacity already substantial, there are reports of a massive expansion of steel plate capacity. Metal Bulletin reported projects by plate producer Azovstal that would bring its plate mill's output to 6 million tonnes by 2005.¹⁹⁵ This would increase the known steel plate capacity to 8.6 million tonnes. Even if these two producers would depend on exports for only half of their plate production (compared to the actual average of 70% of steel production), this partial excess supply would still be enough to fill the entire Canadian steel plate market several times.

[167] Since the Plate II finding was rescinded in May 2004, Ukrainian producers resumed exports of steel plate to Canada in massive volume. CBSA import data shows significant volume of steel plate from Ukraine during the first three quarters of 2004.¹⁹⁶ The imported Ukrainian steel plate is not subject to the Finding as the goods meet the Plate II product definition. The entire volume was imported after the Plate II finding was rescinded in May 2004.¹⁹⁷ In addition, the volume of imports from Ukraine is rapidly increasing. According to import permit data for September and October 2004 (the latest months for which such data is on the record), permits were issued for over 51,000 tonnes of steel plate from Ukraine.¹⁹⁸

[168] Such massive surge in the volume of steel plate imports from Ukraine in such a short period provides convincing evidence of substantial excess steel plate availability from Ukraine.

[169] Similarly, the surge in imports also suggests a repeat of the same disruptive behaviour as seen in the past, when the Ukrainian producers continued to export significant volume of low-priced plate to Canada despite the restrictions imposed by the Plate II finding, by switching to exports of dimensions and specifications not covered by the Plate II finding. With a substantial overcapacity, limited access to other major markets, likely increasing competition from China and low import prices from other countries, Ukrainian producers may be more and more willing to sell these large shipments at low prices in order to secure sales volume to maintain their production levels. Ukrainian steel producers have a history of dumping steel products, with anti-dumping measures in place on steel plate and other flat-rolled steel products in Argentina, Canada, China, Columbia, India, Mexico, Peru, Thailand, the U.S. and Venezuela¹⁹⁹, in addition to the quotas in place in the EU. The behaviour exhibited by the Ukrainian producers with respect to the recent surge in imports of non-subject plate as well as their demonstrated history of dumping steel products may be indicative of their likely behaviour with respect to the subject steel plate if the Finding is rescinded.

[170] In addition, the accession of many former Eastern-bloc states to the EU on May 1, 2004, resulted in reduced access to many of Ukraine's traditional customers because of the quotas imposed by the EU.²⁰⁰ Such additional restrictions on Ukraine's export destinations may result in the diversion of additional steel plate to Canada if the Plate IV finding is rescinded as well.

[171] Compared to the 17,798 tonnes of subject steel plate from Ukraine imported during the 12-month period of investigation for the original investigation, the volume of imports of subject steel plate from Ukraine since the Finding has been in place is insignificant. ²⁰¹ Considering that one producer has had normal values in place since January 2002, this may indicate that Ukrainian producers are unable to compete in the Canadian market with measures in place.

[172] As was discussed earlier in this report, steel plate is a commodity-like product whose market is highly price sensitive. It was also noted that the structure of the Canadian market has recently changed, allowing imports to take over a dominant proportion of Canadian steel plate consumption, increasing price competition from several foreign sources. For example, the record indicates that steel plate from certain countries are being imported in 2004 at prices that are some 40% lower than the average price of the Canadian producers. The record indicates that the conditions characterizing the Ukrainian steel plate industry increases the likelihood that the Ukrainian steel plate exporters will have to compete with these lower priced imports to gain market share in Canada if the Finding is rescinded. The factors characterizing the Ukrainian steel plate industry include its very high capacity and planned expansion, its substantial overcapacity and high dependency on exports, its past and continuing disruptive behaviour particularly in the Canadian steel plate market, including the recent surge in non-subject plate imports, its restricted access to traditional customers increasing the risk of diversion and Ukraine's apparent inability to compete with the measures in place.

[173] Based on the evidence contained on the record including: the very high capacity to produce steel plate in Ukraine and its substantial overcapacity resulting in a high dependency on exports, its past and continuing disruptive behaviour particularly in the Canadian steel plate market, including the recent surge in non-subject plate imports, its apparent inability to compete with the measures in place, and its reduced access to traditional customers, combined with the presence of low-priced imports from other countries with which Ukrainian exporters will likely have to compete with to secure sales to Canada, the President determined that the expiry of the Finding was likely to result in the continuation or resumption of dumping into Canada of certain steel plate originating in or exported from Ukraine.

Likelihood of Continued or Resumed Subsidizing

[174] Guided by the 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 following is a summary of the most relevant factors considered in the analysis:

• Recurring benefit streams resulting from certain past subsidies,
• Continued availability of subsidy programs to steel plate producers,
• Introduction of new export promotion programs,
• Imposition of countervailing measures by authorities other than Canada in respect of steel plate or in respect of similar goods, and
• Government involvement in areas or in manners that suggests possible subsidizing of steel plate producers.

[175] In the country-by country analysis below, references are made to continued subsidization arising out of a continuing benefit stream resulting from subsidies that had been used to acquire capital assets. Under SIMA, when a subsidy is used by the recipient to acquire capital assets, the amount of the subsidy is generally amortized over the useful life of the assets rather than being expensed in the period in which the subsidy was received. This results in a benefit stream from the subsidy that continues over an extended period of time and confers a subsidy on the production of the subject goods that occurs during the amortization period. Therefore, for purposes of an expiry review, the government of the country of export is deemed to be providing a subsidy until the end of the amortization period notwithstanding that the subsidy program in question may no longer exist or that no future disbursements will occur.

India

[176] In the course of the original investigation concluded on May 29, 2000, responses to the CBSA's Request for Information were received from the Government of India (GoI) and from SAIL, which was the only exporter of the goods in question during the period of investigation (July 1, 1998 to June 30, 1999). Further to the CBSA's analysis of the submissions, including verification visits conducted in the GoI and SAIL's offices in New Delhi and at SAIL's Bhilai Steel Plant, the CBSA determined that there was a financial contribution by the GoI that had conferred a benefit to SAIL under the following programs:

• Duty Entitlement Pass Book (export subsidy)
• Advance Licences (export subsidy)
• Special Import Licences (export subsidy)
• Export Promotion Capital Goods Scheme (export subsidy)
• Pre-Shipment Export Financial Assistance (export subsidy)

[177] These programs were determined to be specific for the reason that they are prohibited subsidies in accordance with paragraph 2(7.2)(b) of the Act and, under the Act, a prohibited subsidy includes an export subsidy which is a subsidy or a portion of a subsidy that is contingent, in whole or in part, on export performance. The benefits received from these programs, in aggregate, represented 1,738 rupees per tonne.²⁰²

[178] It was also determined at that time that there was no benefit to SAIL in respect of several other programs that were investigated.

[179] On August 3, 2001, a re-investigation of all steel plate findings, including a review of the amounts of subsidy, was initiated. The period of review for purposes of the re-investigation was October 1, 2000, to June 30, 2001. For purposes of that review, Requests for Information (RFI) were sent to the GoI and to potential exporters in India. While the GoI provided a response to the RFI, no response was received from any Indian producer. The CBSA was therefore unable to determine updated amounts of subsidy. Under the circumstances, the amounts of subsidy for purposes of assessing countervailing duty for future imports were determined by ministerial specification. The manner specified was to use the amount of subsidy found for SAIL at the final determination, which was 1,738 rupees per metric tonne. That re-investigation was concluded on January 15, 2002.

[180] On June 16, 2004 a second review of the amounts of subsidy was initiated by the CBSA, respecting the subsidizing of certain steel plate from India, Indonesia and Thailand. In light of the lack of imports of subject goods from India during the period of review for that re-investigation (April 1, 2003 to March 31, 2004)²⁰³, concerned parties were advised that the CBSA would be reviewing their export activities to other countries for purposes of examining whether exporters received countervailable benefits. The parties were also advised that in the event that an expiry review was initiated, their responses would be placed on the administrative record of the expiry review. The GoI as well as two potential exporters, SAIL and Jindal, provided responses to the CBSA's subsidy RFI²⁰⁴.

[181] On the basis of the information received, the CBSA was able to confirm that the following programs were used by the exporters during the period reviewed²⁰⁵:

• Duty Entitlement Pass Book Scheme
• Export Promotion Capital Goods Scheme
• Pre-shipment Export Financing
• Post-shipment Export Financing
• Tax Exemption on Export Profits

[182] While there was enough information to confirm that exporters received countervailable benefits under these programs, the CBSA was unable to determine a total amount of subsidy due to deficiencies in the responses provided by the co-operating parties, particularly from the GoI.

[183] In addition, the following programs were determined to be available to the exporters but were not used by the co-operating exporters during the period investigated with respect to exports of steel plate:

• Advance Licence
• Duty Free Replenishment Certificate
• Duty Free Credit Entitlement Certificate

[184] Furthermore, information indicated that SAIL had received Government loans (or loan guarantees) but there was no conclusive evidence that the exporter had benefited from these programs (i.e. that the loans involved preferential rates). It was also determined that, as found in the past, the exporters are not Export Oriented Units and are not located in Special Economic Zones. These programs are therefore not applicable.

[185] In light of the inability to determine an updated amount of subsidy for purposes of assessing countervailing duty for future imports of subject goods, the ministerial specification in place continues to be applicable.

[186] It is noted that since the Finding has been in place, there has been no imports of subject goods from India. Imports of certain steel plate from India are also subject to anti-dumping measures.

[187] Evidence on the record indicates that steel plate exports from India have been subsidized during the POR through four categories of export promotion programs; (a) excessive refund/remission of duty, (b) duty not collected/grants, (c) export financing and (d) tax exemption on export profits. A summary of the relevant programs providing countervailable benefits follows.

(a) Excess Relief of Duty on Inputs:

[188] Refund/remission/drawback of duty paid or payable on imported inputs consumed in the exported product is permitted by the SIMA and does not constitute a subsidy. However, any amount of relief that is in excess of the actual amount of duty paid or payable on the eligible inputs (i.e. goods consumed in the production of the exported product) consists of an export subsidy. Evidence on the record indicates that the Duty Entitlement Pass Book (DEPB) Scheme is the program resulting in the majority of the export subsidies received by exporters. Investigations and administrative reviews by both Canadian and U.S. authorities confirmed that the use of this program results in a significant amount of excess relief of duty. Evidence on the record indicates that this program is still in existence and will likely continue to be used by steel plate exporters in the foreseeable future.

[189] It is also noted that the new Indian Foreign Trade Policy (2004-2009), which has a stated objective of doubling India's percentage share of global merchandise trade by 2009, also introduces a new export promotion scheme called "Target Plus".²⁰⁶ This new program will grant rewards in duty free credits up to 15% of the value of incremental exports for exporters who achieve certain performance targets in terms of export growth. If administered in a manner that is similar to the administration of the DEBP scheme, this program could likely result in excessive relief of duty and thus, in countervailable benefits to the exporters.

[190] The evidence on the record suggests that steel plate producers will continue to benefit from export subsidies in the form of excessive relief of customs duty on steel making inputs, whether through the DEPB scheme or through an alternative or new schemes.

(b) Duty Not Collected / Grants:

[191] In addition to benefits received under the DEPB Scheme, evidence on file indicates that steel producers have received export subsidies through the Export Promotion Capital Goods (EPCG) Scheme during the POR.

[192] The EPCG Scheme is a program that allows exporters to import capital equipment and components at reduced or nil import duties. Only exporters are eligible for EPCG licences, thus the EPCG Scheme provides a specific subsidy for the reason that it is a prohibited subsidy because it is contingent on export performance. The amount of benefits resulting from this program is distributed over the quantity of steel plate and other steel products produced and exported from the plant using the equipment in question over the useful life of the imported capital goods. Consequently, the program produces a benefit stream that continues to provide a subsidy to the exporter over several years. Given that both SAIL and Jindal reported benefits under this program on imports of capital goods that are still in use in the production of steel plate²⁰⁷, the likelihood of continued subsidizing is evident. Furthermore, as the program is still in existence and with an even larger scope (i.e. as per the new Foreign Trade Policy, second hand goods can now also be imported under the EPCG Scheme²⁰⁸), and given the capital-intensive nature of steel production, it is likely that the exporters will also continue to use the program for future imports of capital goods. It is noted that the total duty rates (basic plus additional) on production equipment totals 38%.²⁰⁹ Therefore, in light of the high cost of such equipment, the duty savings and thus, the subsidy, will likely continue to be high.

(c) Export Financing:

[193] On the basis of the information received during the review of the amounts of subsidy, it was found that steel plate producers received export subsidies in the form of pre-export and post-export financing at preferential rates.²¹⁰ Evidence on the record indicates that the rates relating to these credits have not changed since the subsidy review was concluded.²¹¹ The program is still available to producers and will likely continue to be used in the foreseeable future. In addition, the GoI recently introduced a similar new scheme, called the Gold Card Scheme, which provides easy access to export credits on best terms to creditworthy exporters.²¹²

(d) Tax Exemption for Export Profits:

[194] On the basis of the information received during the review of the amounts of subsidy, it was found that steel plate producers received export subsidies in the form of exemption of export profits under Section 80HCC of the Indian Income Tax Act.²¹³ However, evidence on the record indicates that this program has been abolished as of April 1, 2004.²¹⁴ Consequently, it is unlikely that exports of steel plate will continue to be subsidized through this program.

Other Findings of Subsidizing on Steel Products from India

[195] The CBSA currently has countervailing measures in place on two other steel products from India; hot-rolled steel sheet and stainless steel wire. Similarly, the U.S. also has subsidy findings in place on certain steel plate from India as well as a subsidy finding on a similar hot-rolled steel product, as does the EU.²¹⁵ In addition, in May 2004, the U.S. authorities concluded an administrative review of the amounts of subsidy received on exports of hot-rolled steel products to the U.S. and found that they were being subsidized by an amount equalling 16.88% ad valorem.²¹⁶ The existence of these other countervailing findings/orders and the results from the recent administrative review by the U.S. authorities are further indications that steel plate and other steel products from India are being subsidized and that they will likely continue to be subsidized if the Finding is rescinded.

[196] In light of the above analysis, it appears that, with the exception of one program that is no longer in existence, every export promotion program that was found to be conferring a countervailable benefit during the latest review of the amounts of subsidy is currently still available to the steel plate producers, and they will likely continue to use them. In addition, the GoI has since introduced new programs, although information is not yet available to determine if these programs are countervailable. In addition, subsidies received in the past that are related to the purchases of capital goods that are still in use, have not yet been fully amortized and benefits will consequently continue to accrue over the foreseeable future.

[197] Based on the evidence contained on the record including: the results of a recent review of the amounts of subsidy conducted by the CBSA which confirmed the continued existence of several export subsidy programs which are still used and conferring benefits to steel plate producers, the introduction of new export promotion programs, the recurring benefits of past subsidies (i.e. benefits are recognized over several years), and the other subsidy findings on steel products from India in Canada and in other jurisdictions, the President determined that the expiry of the Finding was likely to result in the continuation or resumption of subsidizing of certain steel plate originating in or exported from India.

Indonesia

[198] During the original investigation, the Government of Indonesia (GoID) and two exporters of subject goods from Indonesia, Krakatau and Gunawan, co-operated for the investigation. Verification meetings were held with all three parties during the investigation; however, the two exporters did not provide sufficient information before the final determination to allow the CBSA to determine amounts of subsidy in the prescribed manner. Therefore, an amount of subsidy was determined for each of the exporters by ministerial specification.²¹⁷

[199] The critical information not provided by Gunawan pertained to a specific program in which the company admitted it had participated. The critical information that was not provided by Krakatau, a government-owned producer, pertained to loan contracts that were converted into equity by the GoID. This information was deemed necessary to verify the terms of the equity infusions.²¹⁸ An equity infusion gives rise to a subsidy when the government pays more than the fair market value for the acquired shares of the company.

[200] On August 3, 2001, a re-investigation for all steel plate cases was initiated including the review of the amounts of subsidy for Indonesian exporters. The review was concluded on January 15, 2002 with no party from Indonesia participating. As a result, the amounts of subsidy previously determined by ministerial specification remained as the best information available.

[201] On June 16, 2004, the CBSA initiated a second review of the amounts of subsidy, which was concluded on September 2, 2004. Requests for information were sent to known steel plate producers in Indonesia and to the GoID. Gunawan and an additional potential exporter, Gunung provided responses.²¹⁹ Since the GoID did not provide a response, there was not sufficient information to confirm whether exporters from Indonesia benefited from countervailable programs as they had in the past. Both of the co-operating exporters claimed that they had not received any benefits. Without the participation of the GoID, however, the CBSA could not confirm this.

[202] Since Krakatau did not participate in this re-investigation, there was also no information presented to confirm that Krakatau no longer benefited from the equity infusion it had received in the past from the GoID or that no other such cash infusions or preferential loans were provided to the company.

[203] It is noted that the U.S. also has countervailing measures in place regarding steel plate as well as a similar steel product (hot-rolled carbon steel flat product) from Indonesia. In their finding on certain steel plate, the U.S. authorities also determined that equity infusions into Krakatau provided countervailable benefits to the company, in addition to preferential loans for the construction of certain fixed assets.²²⁰

[204] Subsidies of this nature produce a benefit stream that continues to provide benefit to the exporter over time and the benefits are generally allocated over several years. For example, if a cash infusion relates to the construction or modernization of a plate mill, the countervailable benefits would be allocated over the anticipated useful life of the fixed asset. Consequently, the subsidies received in the past may still be providing countervailable benefits to the production and sale of the subject goods in the foreseeable future.

[205] In addition, there was a report in Metal Bulletin regarding massive expansion projects at Krakatau, which would allow the producer to more than double its crude steel production by 2008.²²¹ In light of the magnitude of the project and the capital-intensive nature of such expansion, and given that the government owns the company, there is the possibility that more funds may be provided to Krakatau by the GoID, which may provide additional subsidies to the steel plate producers in the foreseeable future. In this regard, the Metal Bulletin article states, "The Indonesian government, which owns Krakatau, is likely to back expansion plans."

[206] Based on the evidence contained on the record including: the nature of the subsidies that were found to have conferred a benefit to steel plate producers in the past (e.g. equity infusion and preferential loans) which continue to provide benefits over several years, the findings of subsidizing of steel plate and another steel product by the U.S. authorities, and the possible involvement of the government of Indonesia in the government-owned steel plate producer Krakatau's massive expansion plans, the President determined that the expiry of the Finding was likely to result in the continuation or resumption of subsidizing of certain steel plate originating in or exported from Indonesia.

Thailand

[207] During the original investigation, both the Royal Thai Government (RTG) and LPN Plate Mill Public Company Ltd. (LPN), which was the only known exporter of subject goods from Thailand, co-operated with the CBSA.

[208] At the time of the preliminary determination, the CBSA determined that there was a financial contribution by the RTG that conferred a benefit to LPN from preferential loans, export packing credits and duty exemption on imports of machinery under the Investment Promotion Act (IPA). Several other programs were found to exist but did not confer a benefit to LPN.²²²

[209] In its final determination, the CBSA stated that the RTG had not provided sufficient information to enable it to determine whether:

a) preferential loans with terms and conditions like those received by LPN:

i. were generally available to all sectors,

ii. had been used predominantly by a particular enterprise, or

iii. disproportionately large amounts of loans had been granted to a limited number of enterprises.

b) LPN had benefited from preferential export insurance rates under the Export Insurance Program; and

c) LPN had benefited from programs available to industries in Export Processing Zones and Industrial Estates.

[210] Consequently, the CBSA determined that sufficient information had not been provided to determine an amount of subsidy in the prescribed manner for subject goods exported by LPN. Therefore, the amount of subsidy was determined according to ministerial specification. The amount of subsidy was equal to 1,860 baht per tonne.

[211] On August 3, 2001, the CBSA initiated a re-investigation in which the amount of subsidy for Thailand was reviewed. The RTG and LPN responded to the CBSA's request for subsidy information. Sufficient information was obtained to determine that the producer did not receive countervailable benefits from most programs that had been alleged as subsidies. However, the CBSA was unable to determine the amount of benefits in respect of certain loans because sufficient information was not available.²²³ Under the circumstances, the amounts of subsidy for purposes of assessing countervailing duty for future imports were determined by ministerial specification. The resulting amounts of subsidy were equal to 1,995 baht per tonne. The review was concluded on January 15, 2002.

[212] On June 16, 2004, the CBSA initiated a second review of the amounts of subsidy, which was concluded on September 2, 2004. While RFIs were sent to steel plate producers in Thailand and to the RTG, only the latter responded.²²⁴ The RTG's response was substantially complete and information was provided on the investigated programs. While not denying the existence or availability of several of the investigated programs, the RTG indicated that steel plate producers did not use any of the programs under review. In its response, the RTG provided letters of confirmation from the organizations that are administering these programs (e.g. EXIM Bank, Industrial Finance Corporation of Thailand, Bank of Thailand, etc.) indicating that no financial support or services were provided to the steel plate producers during the period reviewed. However, despite the RTG's assertion that the steel plate producers did not receive any countervailable benefits during the period reviewed, the status of LPN's loans remained unknown given that LPN did not co-operate and the RTG did not address this issue. As mentioned earlier, benefits associated with loans to LPN were found to exist during the previous review and such loans, even though granted in the past, continue to provide benefits over their full term.

[213] Again, the CBSA did not have complete information concerning the terms and conditions of LPN's loans. Furthermore, given the lack of co-operation by producers, the CBSA was unable to corroborate the RTG's claim that they did not benefit from any of the programs that were available during the period reviewed. Consequently, the amount of subsidy for Thailand continues to be determined under authority of a ministerial specification at 1,995 baht per tonne.

[214] For purposes of this expiry review, neither LPN nor any other producer provided information although a submission was received from the RTG. No additional information was provided by the RTG regarding LPN. Therefore, the administrative record still contains no further information regarding the status of LPN's loans.

[215] In addition, in a subsidy notification made by the RTG to the World Trade Organization on July 6, 2004, the RTG discussed the availability of several industrial support programs. One of these subsidy programs is the Machinery Upgrading Financing, which provides government loans to targeted industries for purposes such as upgrading production technology. The steel industry is specifically targeted by this program.²²⁵ To date, no evidence suggests that steel plate producers have used such program. However, given the capital-intensive nature of the steel plate industry, such a program, if used by the steel plate producers, could result in countervailable benefits.

[216] With respect to other countervailing measures on steel products from Thailand, the record contains evidence of only one finding on a similar product, which is in place in the U.S.²²⁶ However, there is evidence that this finding may be terminated. According to the RTG, further to a court challenge, the U.S. Department of Commerce was recently instructed to reverse its decision following a determination by the U.S. Court of International Trade that the finding was not in accordance to law and that the revised subsidy rate is de minimis.²²⁷ Therefore, unless the Court's determination is challenged, there are no subsidy findings regarding steel products from Thailand other than the Canadian finding on steel plate. It is noted that LPN was not involved in the U.S. finding, as it was not an exporter of the goods investigated.²²⁸

[217] Despite the uncertainty concerning the current terms and conditions of loans to LPN, the evidence suggests a likelihood that benefits resulting from the loans are still accruing to the producer. Such evidence includes the long useful life of the capital assets acquired with these loans, as well as the government's interest and direct involvement in LPN's loans. In addition, evidence indicates that certain other subsidy programs are available to steel plate producers and could attract their interest in the foreseeable future.

[218] Based on the evidence contained on the record including: the long useful life of the capital assets acquired by a Thai steel plate producer with preferential government loans, the Royal Thai Government's interest and direct involvement in the producer's loans, and the availability of other subsidy programs targeting steel producers, the President determined that the expiry of the Finding was likely to result in the continuation or resumption of subsidizing of certain steel plate originating in or exported from Thailand.

CONCLUSION

[219] For purposes 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 February 10, 2005, pursuant to paragraph 76.03(7)(a) of SIMA, the President of the Canada Border Services Agency determined that the expiry of the finding made by the Canadian International Trade Tribunal on June 27, 2000, in Inquiry No. NQ-99-004, as amended on August 23, 2004, in Interim Review No. RD-2004-002, concerning the dumping in Canada of certain hot-rolled carbon steel plate originating in or exported from Brazil, Finland, India, Indonesia, Thailand and Ukraine, and the subsidizing of certain hot-rolled carbon steel plate originating in or exported from India, Indonesia and Thailand :

1. was likely to result in the continuation or resumption of dumping of the above-mentioned goods from Brazil, India, Indonesia, and Ukraine,

2. was unlikely to result in the continuation or resumption of dumping of the above-mentioned goods from Finland and Thailand, and

3. was likely to result in the continuation or resumption of subsidizing of the above-mentioned goods from India, Indonesia and Thailand.

FUTURE ACTION

[220] On February 11, 2005, the Tribunal commenced its inquiry to determine whether the expiry of the finding on subject goods from Brazil, India, Indonesia, Thailand and Ukraine is likely to result in injury or retardation to the Canadian industry. The Tribunal will make its decision by June 27, 2005.

[221] If the Tribunal determines that the expiry of the finding with respect to goods from Brazil, India, Indonesia, Thailand and Ukraine is likely to result in injury or retardation to the Canadian industry, the finding will be continued with respect to those goods, with or without amendment. If this is the case, the CBSA will continue to levy anti-dumping duty and/or countervailing duty on dumped and/or subsidized importations of certain hot-rolled steel plate if warranted.

[222] If the Tribunal determines that the expiry of the finding with respect to goods from Brazil, India, Indonesia, Thailand and Ukraine is unlikely to result in injury or retardation, the finding will be rescinded in respect of those goods. Anti-dumping duty and/or countervailing duty would no longer be levied on importations of certain hot-rolled steel plate beginning on the date the finding is rescinded.

[223] Given that the President has determined that the expiry of the finding with respect to certain hot-rolled steel plate originating in or exported from Finland and Thailand was unlikely to result in the continuation or resumption of dumping of the goods, the Tribunal will not consider these goods in its determination of the likelihood of material injury or retardation and will issue an order rescinding the finding of dumping with respect to those goods.

INFORMATION

[224] For further information, please contact Denis Chénier or Michel Leclair at:

Mail	Canada Border Services Agency Anti-dumping and Countervailing Directorate SIMA Registry 100 Metcalfe Street, 11th Floor Ottawa, Ontario K1A 0L8  Canada
Telephone	(613) 954-7394 or (613) 954-7232
Fax	(613) 954-3750
Website	www.cbsa.gc.ca/sima

Pierre Richard
Vice President
Admissibility Branch

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APPENDIX

Findings and Orders Concerning Certain Steel Plate

Dates	Countries	Product Dimensions (all 24" - 152" wide) thickness range:
Plate I: - Findings 1993 - Rescission 1998	Belgium, Brazil, Czech Republic, Denmark, Federal Republic of Germany, Romania, United Kingdom, United States of America, Former Yugoslav Republic of Macedonia	0.187" - 3.125"
Plate II: - Finding 1994 - Order 1999 - Rescission May 2004	Italy, Republic of Korea, Spain, Ukraine	0.187" - 4"
Plate III: - Findings 1997 - Rescission in January 2003 for Mexico - Order in Jan. 2003 for the other countries.	People's Republic of China, Republic of South Africa, Russian Federation, Mexico	0.187" - 4"
Plate IV: - Finding 2000.	Brazil, Finland, India, Indonesia, Thailand,	0.187" - 5.25"
	Ukraine	4" - 5.25"
Plate V: - Finding 2004	Bulgaria, Czech Republic, Romania	0.187" - 4"

Plate I was rescinded on May 5, 1998. Of the named Plate I countries, Brazil is now involved in Plate IV while two other countries, the Czech Republic and Romania, are now involved in Plate V.

The Tribunal issued the Plate II finding of injurious dumping on May 17, 1994. On May 17, 1999, the Tribunal issued an order continuing the finding for another five years following the conduct of an expiry review and the determination that there was a likelihood of resumed injurious dumping if the finding was rescinded. The Plate II finding was subsequently rescinded on May 17, 2004 by the Tribunal on grounds that resumed dumping was unlikely to cause injury to the Canadian industry.

The Plate III findings of injurious dumping of steel plate from the People's Republic of China (China), the Russian Federation (Russia) the Republic of South Africa (South Africa) and Mexico were issued by the Tribunal on October 27, 1997. On June 11, 2002, an expiry review investigation was concluded and it was determined that dumping would likely continue or resume if the findings expired. The Tribunal issued an order on January 10, 2003, continuing the finding with respect to China, Russia and South Africa, after having determined that there was a likelihood of injury. On the same date, the Tribunal also issued an order rescinding the finding with respect to Mexico on grounds that resumed dumping was unlikely to cause injury to the Canadian industry.

The Plate IV finding of injurious dumping was issued by the Tribunal on June 27, 2000. While both Plate II and Plate IV involve Ukraine, Plate II included Ukrainian plate in thicknesses from 0.187 inch to 4 inches whereas Plate IV includes Ukrainian plate in thicknesses from 4 inches to 5.25 inches. Also, a specific type of Ukrainian plate excluded from the definition of Plate II was included in the Plate IV finding.

The Plate V finding of injurious dumping of steel plate from Bulgaria, the Czech Republic and Romania was issued by the Tribunal on January 9, 2004. Plate V originally included plate in thicknesses from 0.187 inch to 5.25 inches but the Tribunal excluded plate in thicknesses greater than 4 inches.

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1 Exhibit 6; Customs Notice CN-589.

2 All quantities in this report are expressed in metric tonnes.

3 Exhibit 101; Algoma response to Expiry Review Questionnaire (ERQ) - Question A2

4 Exhibit 97; IPSCO response to Producer ERQ - Question A2

5 Exhibit 93; Stelco response to ERQ - Question A27

6 Exhibit 104; Apparent Canadian Market Statistics

7 Exhibit 104; Apparent Canadian Market Statistics

8 Exhibit 104; Apparent Canadian Market Statistics.

9 Exhibit 107; CBSA enforcement information for POR.

10 Exhibit 121; IPSCO case arguments, page 4

11 Exhibit 121; IPSCO case arguments, page 5

12 Exhibit 121; IPSCO case arguments, page 5

13 Exhibit 123; Algoma case arguments, page 16

14 Exhibit 123; Algoma case arguments, page 17

15 Exhibit 123; Algoma case arguments, pp.17, 18

16 Exhibit 123; Algoma case arguments, page 19

17 Exhibit 121; IPSCO case arguments, page 7

18 Exhibit 121; IPSCO case arguments, page 8 and Exhibit 60, Emerging Steel Markets Monthly, July 2004, page 7

19 Exhibit 121; IPSCO case arguments, page 8 and Exhibit 118-B, Global Steel Output to Smash Billion-Tonne Barrier, November 26 2004

20 Exhibit 121; IPSCO case arguments, page 9

21 Exhibit 121; IPSCO case arguments, page 10

22 Exhibit 121; IPSCO case arguments, page 10

23 Exhibit 121; IPSCO case arguments, page 10

24 Exhibit 121; IPSCO case arguments, page 11 and Exhibit 112, Steel Thermometer #117, October 1, 2004, page 9

25 Exhibit 123; Algoma case arguments, page 22

26 Exhibit 121; IPSCO case arguments, page 11

27 Exhibit 123; Algoma case arguments, page 23

28 Exhibit 123; Algoma case arguments, page 9

29 Exhibit 123; Algoma case arguments, page 10

30 Exhibit 123; Algoma case arguments, page 11

31 Exhibit 123; Algoma case arguments, pp. 12, 13

32 Exhibit 121; IPSCO case arguments, page 25

33 Exhibit 123; Algoma case arguments, pp. 15, 16

34 Exhibit 123; Algoma case arguments, page 28

35 Exhibit 123; Algoma case arguments, page 8

36 Exhibit 121; IPSCO case arguments, page 23

37 Exhibit 123; Algoma case arguments, page 10

38 Exhibit 121; IPSCO case arguments, pp. 14, 19

39 Exhibit 121; IPSCO case arguments, page 15

40 Exhibit 123; Algoma case arguments, page 23

41 Exhibit 123; Algoma case arguments, page 23

42 Exhibit 121; IPSCO case arguments, pp. 6, 19, 20

43 Exhibit 123; Algoma case arguments, page 23

44 Exhibit 121; IPSCO case arguments, page 17

45 Exhibit 123; Algoma case arguments, page 24

46 Exhibit 123; Algoma case arguments, page 24

47 Exhibit 121; IPSCO case arguments, pp. 12,13

48 Exhibit 121; IPSCO case arguments, pp. 20, 23

49 Exhibit 121; IPSCO case arguments, pp. 23, 24

50 Exhibit 121; IPSCO case arguments, page 16

51 Exhibit 121; IPSCO case arguments, page 15

52 Exhibit 121; IPSCO case arguments, page 18

53 Exhibit 121; IPSCO case arguments, page 15

54 Exhibit 121; IPSCO case arguments, page 17

55 Exhibit 121; IPSCO case arguments, page 24

56 Exhibit 123; Algoma case arguments, page 25

57 Exhibit 121; IPSCO case arguments, pp. 12, 18

58 Exhibit 123; Algoma case arguments, page 25

59 Exhibit 121; IPSCO case arguments, page 12

60 Exhibit 123; Algoma case arguments, pp. 25,26

61 Exhibit 123; Algoma case arguments, page 11

62 Exhibit 121; IPSCO case arguments, page 18

63 Exhibit 123; Algoma case arguments, page 10

64 Exhibit 121; IPSCO case arguments, page 19

65 Exhibit 121; IPSCO case arguments, pp. 21,22

66 Exhibit 123; Algoma case arguments, page 26

67 Exhibit 123; Algoma case arguments, page 27

68 Exhibit 123; Algoma case arguments, page 27

69 Exhibit 121; IPSCO case arguments, page 16

70 Exhibit 95; SAIL's response to the ERQ, response to question A8

71 Exhibit 95; SAIL's response to the ERQ, response to question B18

72 Exhibit 95; SAIL's response to the ERQ, response to question B18, B20

73 Exhibit 95; SAIL's response to the ERQ, response to question B18, B19, B22

74 Exhibit 95; SAIL's response to the ERQ, response to question B18

75 Exhibit 95; SAIL's response to the ERQ, response to question B21

76 Exhibit 95; SAIL's response to the ERQ, response to question B17

77 Exhibit 95; SAIL's response to the ERQ, response to question B21, B22

78 Exhibit 30; CITT - Administrative Record concerning expiry No: RR-2004-004, Reply Submissions from SAIL

79 Exhibit 95; SAIL's response to the ERQ, response to question B22

80 CITT Statement of Reasons, RR-98-004, pp. 13-14

81 Canadian International Trade Tribunal, Orders and Reasons, Expiry Review No. RR-2003-001, Certain Hot-rolled Carbon Steel and High-strength Low-alloy Plate Originating in or Exported From Italy, the Republic of Korea, Spain and the Ukraine, May 17, 2004. Par. 57

82 Canadian International Trade Tribunal, Orders and Reasons, Expiry Review No. RR-2003-001, Certain Hot-rolled Carbon Steel and High-strength Low-alloy Plate Originating in or Exported From Italy, the Republic of Korea, Spain and the Ukraine, May 17, 2004. Par. 57

83 Canadian International Trade Tribunal, Orders and Reasons, Expiry Review No. RR-2003-001, Certain Hot-rolled Carbon Steel and High-strength Low-alloy Plate Originating in or Exported From Italy, the Republic of Korea, Spain and the Ukraine, May 17, 2004. Par. 58,59

84 Canadian International Trade Tribunal, Orders and Reasons, Expiry Review No. RR-2003-001, Certain Hot-rolled Carbon Steel and High-strength Low-alloy Plate Originating in or Exported From Italy, the Republic of Korea, Spain and the Ukraine, May 17, 2004. Par. 55

85 Canadian International Trade Tribunal, Orders and Reasons, Expiry Review No. RR-2003-001, Certain Hot-rolled Carbon Steel and High-strength Low-alloy Plate Originating in or Exported From Italy, the Republic of Korea, Spain and the Ukraine, May 17, 2004. Par. 60-62

86 Canadian International Trade Tribunal, Orders and Reasons, Expiry Review No. RR-2003-001, Certain Hot-rolled Carbon Steel and High-strength Low-alloy Plate Originating in or Exported From Italy, the Republic of Korea, Spain and the Ukraine, May 17, 2004. Par. 66-70

87 Canadian International Trade Tribunal, Orders and Reasons, Expiry Review No. RR-2003-001, Certain Hot-rolled Carbon Steel and High-strength Low-alloy Plate Originating in or Exported From Italy, the Republic of Korea, Spain and the Ukraine, May 17, 2004. Par. 76-77

88 Canadian International Trade Tribunal, Orders and Reasons, Expiry Review No. RR-2003-001, Certain Hot-rolled Carbon Steel and High-strength Low-alloy Plate Originating in or Exported From Italy, the Republic of Korea, Spain and the Ukraine, May 17, 2004. Par. 70,75

89 Exhibit 112 (P.); World Steel Dynamics, Steel Strategist #30, August 30 2004, p. 1

90 Exhibit 46; IISI's Steel News - Media Release, April 26, 2004

91 Exhibit 46; IISI - 2004 Edition of World Steel in Figures, p.3

92 Exhibit 109; Richard Berner, Morgan Stanley's Global Economic Forum, Limited US Fallout from a China slowdown, May 3, 2004, p.4

93 Exhibit 110; IISI; Steel Statistical Yearbook 2004, November 2004

94 Exhibit 46; IISI - 2004 Edition of World Steel in Figures, p.3

95 Exhibit 74; MEPS - World Steel Outlook, "Record World Steel Output This Year Despite Raw Material Shortages, July 2004

96 Exhibit 55; Metal Bulletin, "Plate mills planning $50/T price boost for July", May 20, 2004; Exhibit 55; Metal Bulletin, "Strong demand and a limited supply sustain US plate market", September 28, 2004. Exhibit 108; Metal Bulletin, "ISG ups plate surcharge to $178/T, November 24, 2004. [Note: while the articles refer to prices per short ton, the CBSA has converted them per TONNES for consistency in its analysis.]

97 Exhibit 74; MEPS News, Availability has Replaced Price as Main Driver in Steel Markets, April 2004

98 Exhibit 74; MEPS News, Availability has Replaced Price as Main Driver in Steel Markets, April 2004

99 Exhibit 109; Exhibit 109 (N.C.); Eva Cheng, Unsustainable Growth in China, Green Left Weekly, March 24, 2004

100 Exhibit 109; Stephen Roach, When China Sneezes, Morgan Stanley's Global Economic Forum, May 3, 2003

101 Exhibit 109; Tom Stundza, Purchasing Magazine Online, Will Beijing's economic adjustments cut short the bull market in commodity pricing?, June 3, 2004

102 Exhibit 54; Metal Bulletin, Beijing mulls new measures to curb metals and minerals investment, August 26, 2004

103 Exhibit 54; Metal Bulletin, Latest figures show slowing Chinese steel sector: Cisa, July 29, 2004

104 Exhibit 54; Metal Bulletin, Weak Chinese steel market shows a few signs of life, July 26, 2004

105 Exhibit 90; Metal Bulletin, China's steel import market stable, November 5, 2004

106 Exhibit 77; People's Daily, Overheating in steel sector under control, September 2, 2004. Exhibit 77; Bloomberg, China's Economic Curbs Are Working, Vice Premier Says, September 19, 2004. Exhibit 77; China's growth hits 9.5% Jan-Sept, Chinaview, October 22, 2004. Exhibit 77; Bloomberg, China's Rising Demand for Coal, Steel Eases Slowdown Concerns, August 30, 2004

107 Exhibit 90; Metal Bulletin, "Chinese cooling and infrastructure measures are working: CISA", November 1, 2004

108 Exhibit 109; Stephen Roach, Morgan Stanley's Global Economic Forum, When China Sneezes, May 3, 2004

109 Exhibit 60; Metal Bulletin Research - Emerging Steel Markets Monthly, Issue 24, September 2004

110 Exhibit 112; World Steel Dynamics, Global Steel Alert #24, September 10, 2004

111 Exhibit 60; Metal Bulletin Research - Emerging Steel Markets Monthly, Issue 22, July 2004, p.7

112 Exhibit 60; Metal Bulletin Research - Emerging Steel Markets Monthly, Issue 22, July 2004, p.7

113 Exhibit 112; World Steel Dynamics, Steel Strategist #30, August 30 2004, p.100, and Global Steel Alert #24, Sept. 10, 2004, p. 21

114 Exhibit 60; Metal Bulletin Research - Emerging Steel Markets, July 2, 2004, page 7

115 Exhibit 86; Metal Bulletin Research - Emerging Steel Markets, Issue 25, October 2004, p. 6

116 Exhibit 60; Metal Bulletin Research - Emerging Steel Markets Monthly, Issue 24, September 2004, p.3

117 Exhibit 113; Deutch Bank Research, Steel Market in China; Constraints check more powerful growth - China Special, August 6, 2004. Exhibit 112; World Steel Dynamics, Steel Strategist #30, August 30 2004, p.91

118 Exhibit 46; IISI's Steel News - Media Release, April 26, 2004.

119 Exhibit 74; MEPS International Steel Review, "US Steel Prices Outperform MEPS World Index", April 2, 2004

120 Canadian International Trade Tribunal, Orders and Reasons, Expiry Review No. RR-2003-001, Certain Hot-rolled Carbon Steel and High-strength Low-alloy Plate Originating in or Exported From Italy, the Republic of Korea, Spain and the Ukraine, May 17, 2004. Par. 55

121 Exhibit 55; Metal Bulletin, "Strong demand and a limited supply sustains US plate market", Sept. 28, 2004

122 Exhibit 86; Metal Bulletin Research - Emerging Steel Markets Monthly, Issue 25, October 2004

123 Exhibit 116; Additional information provided by Algoma, Attachment B2, U.S. imports of steel plate from 1999 to September 2004 (YTD), detailed by country of export, as compiled by the U.S.ITC

124 Exhibit 86; Metal Bulletin Research - Emerging Steel Markets Monthly, Issue 25, October 2004

125 Exhibit 86; Metal Bulletin Research - Emerging Steel Markets Monthly, Issue 25, October 2004

126 Exhibit 103; Apparent Canadian market data for certain steel plate compiled by the CBSA with data from the producer as well as its own internally generated import data

127 Exhibit 92; Confidential response from former Canadian steel plate producer Stelco Inc. to the Producer Expiry Review Questionnaire, Appendix 5 and Exhibit 103; Apparent Canadian market data for certain steel plate compiled by the CBSA with data from the producer as well as its own internally generated import data

128 Exhibit 92; Confidential response from former Canadian steel plate producer Stelco Inc. to the Producer Expiry Review Questionnaire, response to question A2 and Appendix 2

129 Exhibit 123; Algoma's Case Arguments, par. 48 and Exhibit 92; Stelco's response to the ERQ as was presented for the Plate II expiry review

130 Exhibit 101; Algoma's non-confidential response to the Producer ERQ, response to question A18

131 Exhibit 103; Apparent Canadian market data for certain steel plate compiled by the CBSA with data from the producer as well as its own internally generated import data

132 Exhibit 99, Non-confidential responses from Salzgitter Trade Inc. to the CBSA's Importer Expiry Review Questionnaire, November 19, 2004

133 Exhibit 116; Additional evidence provided by Algoma prior to the closing of the record, Non-confidential Attachment B2

134 Exhibit 103; Apparent Canadian market data for certain steel plate compiled by the CBSA with data from the producer as well as its own internally generated import data.

Exhibit 105; Breakdown of import data per country as compiled by the CBSA from Customs data

135 Exhibit 46; IISI, 2004 Edition - World Steel in Figures, pp. 3, 11, 21

136 Exhibit 49; Metal Bulletin, "Brazilian first-half exports fell by more than 6 million tonnes", July 29, 2004

137 Exhibit 49; Metal Bulletin, "Usiminas ponders new blast furnace", August 19, 2004

138 Exhibit 60; Metal Bulletin Research, Emerging Steel Markets Monthly, Issue 21, June 2004

139 Exhibit 12; IPSCO's non-confidential case arguments, par. 48 and Exhibit 108; Metal Bulletin, "Steel Subsidy Trend Jolts NAFTA Partners", November 19, 2004

140 Exhibit 49; Metal Bulletin, "Usiminas ponders new blast furnace", August 19, 2004

141 Exhibit 86; Metal Bulletin Research, Emerging Steel Markets Monthly, Issue 25, Oct. 2004, page 6

142 Exhibit 86; Metal Bulletin Research, Emerging Steel Markets Monthly, Issue 25, Oct. 2004, page 5

143 Exhibit 123; Algoma's non-confidential case arguments, pp. 29-34 and Exhibit 43 Semi-annual reports to the WTO Committee on Anti-Dumping Practice, under article 16.4 of the Agreement, from several member-countries

144 Exhibit 80; Steel Orbis, Final Results of AD Review on HR Flat Products from Two Countries, September 13, 2004

145 Exhibits 103; CBSA Apparent Canadian market data for January 1, 2001 to September 30, 2004, including details of import data from Brazil, December 2, 2004 and Exhibit 106; CBSA Enforcement data regarding imports of subject plate from Brazil during the POR, December 2, 2004

146 CBSA Statement of Reasons respecting the dumping into Canada of certain hot-rolled carbon steel plate originating in or exported from Brazil, Finland, India, Indonesia, Thailand and Ukraine and the injurious subsidizing of the same goods originating in or exported from India, Indonesia and Thailand, May 29, 2000

147 Exhibit 3; Memorandum D15-2-31 regarding the assessment of anti-dumping duty on certain hot-rolled carbon steel plate and high-strength low-alloy steel plate originating in or exported from Brazil, Finland, India, Indonesia, Thailand and Ukraine, and countervailing duty with respect to the same goods originating in or exported from India, Indonesia and Thailand, October 10, 2000 and Exhibit 4; Customs Notice CN-433 regarding the conclusion on January 15, 2002, of a re-investigation of normal values and export prices regarding certain hot-rolled carbon steel plate and high-strength low-alloy steel plate from several countries including Finland. March 4, 2002

148 Exhibit 53; Metal Bulletin, "Rautaruukki yet to decide on October plate prices", July 27, 2004

149 Exhibit 123; Algoma case arguments, Table 2, page 22

150 Exhibit 82; Rautarruukki's 2003 Annual Report, p. 1. and Exhibit 90; Metal Bulletin, "Rautaruukki triples profits to September", October 26, 2004

151 Exhibit 106; CBSA's Plate IV Enforcement Data for the POR, December 2, 2004.

152 Exhibit 103; Apparent Canadian market data compiled by the CBSA, December 2, 2004.

153 Exhibit 90; Metal Bulletin, "Plate prices to rise into mid-2005", October 20 2004

154 Exhibit 116; Algoma's additional evidence, U.S. International Trade Commission statistics on plate imports

155 Exhibit 82; Rautaruukki's 2003 Annual Report, page 21

156 Exhibit 86; Metal Bulletin Research - Emerging Steel Markets Monthly, Issue 25, October 2004

157 Exhibit 111; Semi-annual reports to the WTO Committee on Anti-Dumping Practices by the U.S.A, September 29, 2004

158 Exhibit 94; SAIL's response to the CBSA's Exporter ERQ, response to question B11 and Exhibit 114; Government of India's response to the CBSA's Foreign Government ERQ, response to question A6

159 Exhibit 95; Estimate based on growth rate in the first half of the current year as per SAIL's submission, B11

160 Exhibit 114; Government of India's response to the CBSA's Foreign Government ERQ, response to question A6

161 Exhibit 114; Government of India's response to the CBSA's Foreign Government ERQ, response to question A6

162 Exhibit 114; Government of India's response to the CBSA's Foreign Government ERQ, response to question A6

163 Exhibit 95; SAIL's response to the CBSA's Exporter ERQ, Appendix 1

164 Exhibit 95; SAIL's response to the CBSA's Exporter ERQ, response to B21

165 Exhibit 86; Metal Bulletin Research - Emerging Steel Markets Monthly, Issue 25, October 2004, page 7

166 Exhibit 48; Metal Bulletin, "Jindal's Raigarh works plans massive expansion", April 26, 2004 and "SAIL plans $2.29 billion upgrade at Bhilai", April 6, 2004

167 Exhibit 61; Rajeev Ahuja, India Council for Research on International Economic Relations, Export Incentives in India Within the WTO Framework, July 2001 pp. 23,24 and Exhibit 70; India's Foreign Trade Policy (2004-2009), September 1, 2004

168 Exhibit 94; SAIL's response to the CBSA's Exporter ERQ, Appendices 1 and 3

169 Exhibit 123; Algoma's case arguments, pp. 28 to 34

170 Exhibit 111; Semi-annual report of the U.S. to the WTO Committee on Anti-dumping Practices, September 29, 2004

171 Exhibit 106; CBSA's Plate IV Enforcement Data for the POR, December 2, 2004

172 Exhibit 116; Algoma's additional evidence, U.S. International Trade Commission statistics on plate imports

173 Exhibit 30; CITT's Administrative Record concerning expiry No: RR-2004-004 on certain hot-rolled steel plate from Brazil, Finland, India, Indonesia, Thailand and Ukraine, Submissions from IPSCO, tab 14, SEASI Steel Statistical Yearbook 2004, Apparent steel consumption of total steel products in Indonesia from 1994 to 2003

174 Exhibit 51; Metal Bulletin, "Krakatau aims for 5 million tpy of crude steel", March 24, 2004

175 Exhibit 33; Gunung's response to the CBSA's RFI of June 16, 2004 for purposes of the review of the amounts of subsidy on certain steel plate from Indonesia, July 26, 2004 and Exhibit 39; Gunawan's response to the CBSA's RFI of June 16, 2004 for purposes of the review of the amounts of subsidy on certain steel plate from Indonesia, July 29, 2004

176 Exhibit 106; CBSA's Plate IV Enforcement Data for the POR, December 2, 2004

177 Exhibit 116; Algoma's additional evidence, U.S. International Trade Commission statistics on plate imports

178 Exhibit 111; Semi-annual reports to the WTO Committee on Anti-Dumping Practices, Report of the U.S. Government, September 29, 2004

179 Exhibit 111; Semi-annual reports to the WTO Committee on Anti-Dumping Practices, Report of the Australian Government, November 1, 2004

180 Exhibit 111; Semi-annual reports to the WTO Committee on Anti-Dumping Practices

181 Exhibit 40; Gunawan's response to the CBSA's RFI of June 16, 2004 for purposes of the review of the amounts of subsidy on certain steel plate from Indonesia, enclosure 1, July 29, 2004

182 Exhibit 39; Gunawan's response to the CBSA's RFI of June 16, 2004 for purposes of the review of the amounts of subsidy on certain steel plate from Indonesia, response to question D14, enclosure 3, July 29, 2004

183 Exhibit 30; CITT's Administrative Record concerning expiry No: RR-2004-004 on certain hot-rolled steel plate from Brazil, Finland, India, Indonesia, Thailand and Ukraine, Submissions from IPSCO, tab 14, SEASI Steel Statistical Yearbook 2004

184 Exhibit 30; CITT's Administrative Record concerning expiry No: RR-2004-004 on certain hot-rolled steel plate from Brazil, Finland, India, Indonesia, Thailand and Ukraine, Submissions from IPSCO, tab 14, SEASI Steel Statistical Yearbook 2004

185 Exhibit 50; Metal Bulletin, "Thailand soft peddles in HR dumping duties controversy", August 27, 2004

186 Exhibit 102; Response of the Government of Thailand to the CBSA's Government ERQ, response to question A5

187 Exhibit 30; CITT's Administrative Record concerning expiry No: RR-2004-004 on certain hot-rolled steel plate from Brazil, Finland, India, Indonesia, Thailand and Ukraine, Submissions from IPSCO, tab 14, SEASI Steel Statistical Yearbook 2004, Apparent steel consumption/export figures for steel products in Thailand from 1994 to 2003

188 Exhibit 50; Metal Bulletin articles on this subject, March 12, 2004 to August 27, 2004

189 Exhibit 68; U.S. International Trade Administration, Issues and Decision Memorandum in the Final Affirmative Countervailing Duty Determination: Certain Hot-rolled Carbon Steel Flat Products from Thailand, September 21, 2001

190 Exhibit 3; Memorandum D15-2-31 regarding the assessment of anti-dumping duty on certain hot-rolled carbon steel plate and high-strength low-alloy steel plate originating in or exported from Brazil, Finland, India, Indonesia, Thailand and Ukraine, and countervailing duty with respect to the same goods originating in or exported from India, Indonesia and Thailand, October 10, 2000

191 Exhibit 4; Customs Notice CN-433 regarding the conclusion on January 15, 2002, of a re-investigation of normal values and export prices regarding certain hot-rolled carbon steel plate and high-strength low-alloy steel plate from several countries including Ukraine, March 4 2002

192 Exhibit 46; IISI, 2004 Edition - World Steel in Figures, pp. 3, 11

193 Exhibit 123; Algoma's case arguments, table 2, page 22, with reference to Exhibit 101, attachment A23 (e)

194 Exhibit 60; Metal Bulletin Research - Emerging Steel Markets Monthly, Issue 22, July 2004, page 6

195 Exhibit 52; Metal Bulletin, "Azovstal adds 2.5 million tpy slab capacity", June 1, 2004

196 Exhibit 105; Breakdown of import data per country for all countries not subject to a plate finding, as compiled by CBSA's internally generated Customs data, December 2, 2004

197 Exhibit 105; Breakdown of import data per country for all countries not subject to a plate finding, as compiled by CBSA's internally generated Customs data, December 2, 2004, and Exhibit 103; Apparent Canadian market for certain steel plate as compiled by the CBSA, December 2, 2004

198 Exhibit 87; International Trade Canada's imports permits data for January to October 2004

199 Exhibit 123; Algoma's case arguments, page 30

200 Exhibit 52; Metal Bulletin; "Ukraine, EU to meet over exports for 2005", October 12, 2004

201 CBSA Statement of Reasons respecting the dumping into Canada of certain hot-rolled carbon steel plate originating in or exported from Brazil, Finland, India, Indonesia, Thailand and Ukraine and the injurious subsidizing of the same goods originating in or exported from India, Indonesia and Thailand, May 29, 2000

202 CBSA Statement of Reasons respecting the Final determination regarding the dumping into Canada of certain hot-rolled carbon steel plate originating in or exported from Brazil, Finland, India, Indonesia, Thailand and Ukraine and the subsidizing of the same goods originating in or exported from India, Indonesia and Thailand, May 29, 2000

203 Not to be confused with the POR for purposes of this expiry review (Jan. 1, 2001 to Sept. 30, 2004)

204 Responses are listed as Exhibits 31 and 32 for SAIL, 37 and 38 for Jindal and 41 for the Government of India

205 Exhibits 31 and 37; SAIL and Jindal's responses to the CBSA's RFI as part of the review of the amounts of subsidy concluded on September 2, 2004

206 Exhibit 70; India's Foreign Trade Policy (2004-2009), Highlights, 1(b) and 7(a)

207 Exhibits 31 and 37; SAIL and Jindal's responses to the CBSA's RFI as part of the review of the amounts of subsidy concluded on September 2, 2004, part C

208 Exhibit 70; India's Foreign Trade Policy (2004-2009), Chapter 5

209 Exhibit 114; Response of the Government of India to the CBSA's ERQ

210 Exhibits 31 and 37; SAIL and Jindal's responses to the CBSA's RFI as part of the review of the amounts of subsidy concluded on September 2, 2004, part E and F

211 Exhibit 114; Response of the Government of India to the CBSA's ERQ

212 Exhibit 114; Response of the Government of India to the CBSA's ERQ

213 Exhibits 31 and 37; SAIL and Jindal's confidential responses to the CBSA's RFI as part of the review of the amounts of subsidy concluded on September 2, 2004, part H

214 Exhibit 114; Response of the Government of India to the CBSA's ERQ and Exhibit 75; ieport Daily News, "Exporters may not get income tax sops", June 17, 2004

215 Exhibit 44; Semi-annual report to the WTP Committee on Subsidies and Countervailing Measures, under article 25.11 of the Agreement, by Canada, the United States and the European Communities

216 Exhibit 66; United States Import Administration, Issues and Decision Memorandum: Final Results of Countervailing Duty Administrative Review: Certain Hot-rolled Carbon Steel Flat Products From India, May 2004.

217 Exhibit 1; CCRA Statement of Reasons concerning the making of a final determination of dumping with respect to certain hot-rolled carbon steel plate originating in or exported from Brazil, Finland, India, Indonesia, Thailand and Ukraine and of subsidizing with respect to certain hot-rolled carbon steel plate originating in or exported from India, Indonesia and Thailand, May 29, 2000.

218 Exhibit 1; CCRA Statement of Reasons concerning the making of a final determination of dumping with respect to certain hot-rolled carbon steel plate originating in or exported from Brazil, Finland, India, Indonesia, Thailand and Ukraine and of subsidizing with respect to certain hot-rolled carbon steel plate originating in or exported from India, Indonesia and Thailand, May 29, 2000.

219 Responses are listed as Exhibits 33 and 34 for Gunung and Exhibits 39 and 40 for Gunawan

220 Exhibit 67; U.S. Import Administration, Final Affirmative Countervailable Duty Determination: Certain Cut-to-Length Carbon-Quality Steel Plate From Indonesia, December 29, 1999

221 Exhibit 51; Metal Bulletin, "Krakatau aims for 5 million tpy of crude steel", March 24, 2004

222 CCRA Statement of Reasons concerning the making of a preliminary determination of dumping with respect to certain hot-rolled carbon steel plate originating in or exported from Brazil, Finland, India, Indonesia, Thailand and Ukraine and of subsidizing with respect to certain hot-rolled carbon steel plate originating in or exported from India, Indonesia and Thailand, February 28, 2000.

223 Exhibit 4; Customs Notice N-433 regarding the conclusion of a re-investigation of normal values, export price and amounts of subsidy on certain steel plate, March 2, 2002.

224 The Royal Thai Government's (RTG) responses are listed as Exhibits 35 and 36

225 Extension Under SCM Article 27.4 of the Transition Period for the Elimination of Export Subsidies... WTO Notification G/SCM/N/114/THA, July 6, 2004, p.10-11

226 Exhibit 111; Semi-annual reports to the WTO Committee on Anti-Dumping Practices, Report of the U.S. Government, September 29, 2004

227 Exhibit 102; The RTG's response to the CBSA's ERQ, response to question A4

228 Exhibit 68; U.S. International Trade Administration. Issues and Decision Memorandum in the Final Affirmative Countervailing Duty Determination: Certain Hot-Rolled Carbon Steel Flat Products from Thailand, September 21, 2001