RB4 2020 IN: Certain concrete reinforcing bar
Statement of Reasons—final determination

Domestic industry

[13] The domestic industry is comprised of five producers, AltaSteel Inc. (AltaSteel), ArcelorMittal Long Products Canada, G.P. (AMLPC), Gerdau Ameristeel Corporation (Gerdau), Max Aicher North America Ltd. and Ivaco Rolling Mills 2004 LP.

Trade union

[14] The United Steel Workers (with its various locals) represents persons employed in the production of rebar in Canada.

Importers

[15] The CBSA identified five potential importers of the subject goods from CBSA import documentation. The CBSA sent an Importer request for information (RFI) to all potential importers of the goods.^{Footnote 2} Ferrostaal Metals GmbH provided a response to the Importer RFI.^{Footnote 3}

Exporters

[16] At the initiation of the investigation, the CBSA identified five potential exporters, vendors and producers of the subject goods from information provided by the complainant and CBSA import entry documentation. All of the potential exporters were asked to respond to the CBSA’s Dumping RFI.^{Footnote 4}

[17] Five companies provided responses to the CBSA’s Dumping RFI: Abinsk Electric and Steel Works Ltd. (AESW)^{Footnote 5}, located in Russia and identifying itself as a producer of subject goods exported to Canada; Balakovo Steel Works JSC (BSW)^{Footnote 6}, located in Russia and identifying itself as a producer of rebar in Russia; One Solution Trading Company DMCC (ONEST)^{Footnote 7}, a trading company located in the United Arab Emirates; America Steel Trade Corporation (AST)^{Footnote 8}, a trading company for subject goods located in the United States of America; Jindal Shadeed Iron & Steel LLC (JSIS)^{Footnote 9}, a producer/exporter of subject goods located in Oman.

[18] Of the responses received, no responses were considered complete submissions for purposes of a final determination. These submissions and results have been summarized in the Results of the dumping investigation section, found below.

[19] Respondents who have not provided complete submissions have been informed that their information could not be used for the purposes of the final determination as it was not found to be complete and/or reliable.

Product definition

[20] For the purpose of this investigation, subject goods are defined as:

Additional product information^{Footnote 10}

[21] For greater clarity, the rebar considered to be subject goods includes all hot-rolled deformed bar, rolled from billet steel, rail steel, axle steel, low alloy-steel and other alloy steel that does not comply with the definition of stainless steel.

[22] Uncoated rebar, sometimes referred to as black rebar, is generally used for projects in non-corrosive environments where anti-corrosion coatings are not required. On the other hand, anti-corrosion coated rebar is used in concrete projects that are subjected to corrosive environments, such as road salt. Examples of anti-corrosion coated rebar are epoxy or hot-dip galvanized rebar. The subject goods include uncoated rebar and rebar that has a coating or finish applied.

[23] Fabricated rebar products are generally engineered using Computer Automated Design programs and are made to the customer’s unique project requirements. The fabricated rebar products are normally finished with either a protective or corrosion resistant coating. Rebar that is simply cut-to-length is not considered to be a fabricated rebar product excluded from the definition of subject goods.

[24] Rebar is produced in Canada in accordance with the National Standard of Canada CAN/CSA-G30.18-09(R2019) - Carbon Steel Bars for Concrete Reinforcement, (the “National Standard”) published by the CSA Group and approved by the Standards Council of Canada.

[25] The following are the most common bar designation numbers for the subject goods in Canada, with the corresponding diameter in millimeters in brackets: 10 (11.3), 15 (16.0), 20 (19.5), 25 (25.2), 30 (29.9), 35 (35.7). Rebar sizes are commonly referred to as the bar designation number combined with the letter “M”. For example, 10M rebar is rebar with a bar designation number of 10 and a diameter of 11.3 millimeters. Other diameters may also be demanded, and other measurement systems employed. For example, Imperial measure #7 bar (approximately 22 millimeters) is a common designation used in the mine roofing industry.

[26] The National Standard identifies two grades of rebar, namely regular or “R” and weldable or “W”. R grades are intended for general applications while W grades are used where welding, bending or ductility is of special concern. Weldable rebar is substitutable for regular rebar in all applications, though the reverse does not hold.

[27] The National Standard also identifies yield strength levels of 300, 400, 500 and 600. This number refers to the minimum yield strength and is measured in megapascal (“MPa”). The grade and yield strength of rebar is identified by combining yield strength number with grade. Regular rebar with a yield strength of 400 MPa is 400R and 400W is weldable rebar with a yield strength of 400 MPa. Yield strength is measured with an extensometer in accordance with the requirements of section 9 of the National Standard.

[28] The standard lengths for rebar are 6 metres (20 feet), 12 metres (40 feet) and 18 metres (60 feet); although rebar can be cut and sold in other lengths as specified by customers or sold in coils.

Production process^{Footnote 11}

[29] Deformed steel concrete reinforcing bar can be produced in an integrated steel production facility or using ferrous scrap metal as the principal raw material. Scrap metal is melted in an electric arc furnace and is further processed in a ladle arc-refining unit. The molten steel is then continuously cast into rectangular billets of steel that are cut-to-length. An integrated facility would also produce billets from molten steel. The billets are then rolled into various sizes of rebar which are cut to various lengths depending on the customers’ requirements.

[30] Deformed rebar is rolled with deformations on the bar which provides gripping power so that concrete adheres to the bar and provides reinforcing value. The deformations must conform to requirements set out in national standards.

Product use^{Footnote 12}

[31] Rebar is used in a number of applications, the most common of which is construction. Rebar is most commonly used to reinforce concrete and masonry structures. It enhances the compressional and tensional strength of concrete and helps prevent the concrete from cracking during curing or following changes in temperature. Rebar is also known as “reinforcing steel bar”.

Classification of imports

[32] During the POI, subject goods were normally classified under the following tariff classification numbers:

• 7213.10.00.00
• 7214.20.00.00

[33] In some instances, imports of subject goods may also have been classified under the following tariff classification numbers:

• 7215.90.00.90
• 7227.90.00.90

[34] As of February 4, 2021, the subject goods are usually imported under the following tariff classification numbers:

• 7213.10.00.11
• 7213.10.00.12
• 7213.10.00.13
• 7213.10.00.90
• 7214.20.00.00
• 7215.90.00.20
• 7215.90.00.30
• 7227.90.00.50

[35] The listing of tariff classification numbers is for convenience of reference only. The tariff classification numbers include non-subject goods. Also, subject goods may fall under tariff classification numbers that are not listed. Refer to the product definition for authoritative details regarding the subject goods.

Normal value

[50] Normal values are generally determined based on the domestic selling prices of like goods in the country of export, in accordance with the methodology of section 15 of SIMA which relies on domestic prices, or one of the methodologies of section 19. Where the methodology of paragraph 19(b) is used, it is based on the aggregate of the cost of production of the goods, a reasonable amount for administrative, selling and all other costs, plus a reasonable amount for profits.

Export price

[51] The export price of goods sold to importers in Canada is generally determined in accordance with the methodology of section 24 of SIMA based on the lesser of the adjusted exporter’s sale price for the goods or the adjusted importer’s purchase price. These prices are adjusted where necessary by deducting the costs, charges, expenses, duties and taxes resulting from the exportation of the goods as provided for in subparagraphs 24(a)(i) to 24(a)(iii) of SIMA.

Margin of dumping

[52] The margin of dumping by exporter is equal to the amount by which the total normal value exceeds the total export price of the goods, expressed as a percentage of the total export price. All subject goods imported into Canada during the POI are included in the determination of the margins of dumping of the goods. Where the total normal value of the goods does not exceed the total export price of the goods, the margin of dumping is zero.

[53] Although the CBSA received Dumping RFI responses from exporters in each of the named countries, the responses were not complete and/or reliable and therefore could not be used for the purposes of determining normal values and export prices.

Oman

[54] The CBSA received one response to the Dumping RFI from one respondent in Oman, JSIS.

Jindal Shadeed Iron & Steel LLC

[55] JSIS is a producer and exporter of subject goods that was established as a limited liability company. All of the subject goods shipped to Canada by JSIS were produced at its production facility in Sohar, Oman, where the company is also headquartered.

[56] JSIS provided a response to the Dumping RFI on February 1, 2021.^{Footnote 14} However, a complete non-confidential version was not provided until February 18, 2020, seventeen days after the due date. JSIS’s initial response to the Dumping RFI was considered incomplete as some domestic sales and costing information was not included in the response. Furthermore, the response did not provide allocation methodologies or supporting documentation for export price and normal value adjustments. JSIS was notified of these deficiencies through a deficiency letter on March 1, 2021.^{Footnote 15} The letter noted these deficiencies and advised JSIS to provide a revised Dumping RFI response as soon as possible to ensure that the CBSA has sufficient time to review, analyze and verify the information provided.

[57] On March 10, 2021, JSIS provided a response to the deficiency letter.^{Footnote 16} However a review of the response found that not all deficiencies were sufficiently addressed; namely the deficiencies with respect to domestic sales. On March 24, 2021, JSIS was informed that deficiencies remained unaddressed in a second deficiency letter.^{Footnote 17} On April 1, 2021, JSIS provided additional information in response to the second deficiency letter, with only seven business days until the close of record.^{Footnote 18} Moreover, a complete non-confidential version was not provided until April 6, 2021. The CBSA’s review of the information on the record found that gaps and inconsistencies remained.

[58] JSIS’s delays and failure to properly address the identified deficiencies prevented the CBSA from being able to further question and verify JSIS’s information. Without sufficient time to further question JSIS, request additional supporting documentation and verify the submitted information, the CBSA was precluded from being able to assess whether or not JSIS’s submitted information was complete, accurate and reliable for the purposes of determining a margin of dumping. The CBSA has therefore determined that JSIS’s information is insufficient and unreliable for the purposes of determining a margin of dumping for the final determination.

[59] Accordingly, for purposes of the final determination the CBSA has determined the margin of dumping for JSIS pursuant to a Ministerial Specification based on the methodology as described below under All other exporters rate—Oman.

All other exporters—Oman

[60] As previously stated, the CBSA did not receive complete and reliable responses to the Dumping RFI from any exporters in Oman. As a result, the normal values and export prices for all exporters in Oman were determined pursuant to a ministerial specification under subsection 29(1) of SIMA on the basis of facts available.

[61] In establishing the methodology for estimating normal values and export prices, the CBSA analyzed all the information on the administrative record, including the CBSA’s estimates at the initiation of the investigation, information submitted by exporters of rebar from the named countries and customs documentation.

[62] The CBSA would normally first consider whether information from an exporter of rebar from the applicable country, who provided complete and reliable information, would be appropriate to use as the basis for determining normal values for all other exporters in each respective country

[63] However, as no exporters in Oman or Russia provided a complete and reliable response to the CBSA’s Dumping RFI, the CBSA instead relied on information from the CBSA’s initiation analysis, based on the methodology of paragraph 19(b) of SIMA, by estimating the costs of production of the goods, an amount for general selling and administrative expenses, plus an amount for profit.^{Footnote 19} Adjustments were made to the cost of raw materials and the cost of labour to more reasonably represent costs which may be incurred in the named countries.

[64] The CBSA considered the highest amount by which the normal value estimated by the CBSA at the initiation of the investigation exceeded the export price as an appropriate basis for determining normal values. This methodology limits the advantage that an exporter may gain from not providing necessary information requested in a dumping investigation.

[65] Export prices were based on the declared selling prices on customs entry documentation. The CBSA considers this the best available information on which to base the export prices for all other exporters as it reflects actual import data.

[66] Using the above methodology, the margin of dumping for all exporters in Oman is determined to be 8.0%, expressed as a percentage of the export price.

Russia

[67] The CBSA received responses to the Dumping RFI from one exporter in Russia, AESW, and one other producer of rebar in Russia, BSW.

Abinsk Electric Steel Works Ltd.

[68] AESW is a producer and exporter of subject goods. AESW is located in Abinsk, Krasnodar, Russia. Exports of subject goods by AESW represent nearly 100% of the volume of subject goods exported from Russia during the POI.

[69] AESW provided an incomplete response to the Dumping RFI on February 1, 2021.^{Footnote 20} AESW’s response lacked any supporting documentation concerning the sales of subject goods to Canada or its domestic sales of like goods, and provided incomplete explanations and accounting records to substantiate its cost of production. The CBSA sent AESW a deficiency letter on February 16, 2021.^{Footnote 21} The letter noted these deficiencies and listed each question from the Dumping RFI response that was missing information. The CBSA advised AESW to provide the missing information as soon as possible to ensure that the CBSA has sufficient time to review, analyze and verify the information provided.

[70] AESW provided some of the missing information on February 24, 2021.^{Footnote 22} On March 4, 2021, in the notice of preliminary determination to AESW, the CBSA informed AESW that their additional information would be reviewed and considered by the CBSA in the final phase of the investigation.^{Footnote 23} The CBSA further stated that if all of the deficiencies and missing information identified by the CBSA were not adequately addressed with the submission of this additional information, then AESW’s Dumping RFI response would still be considered incomplete.

[71] AESW’s additional information was reviewed by the CBSA and still found to be incomplete. AESW’s response to the CBSA’s deficiency letter did not provide any information with respect to some of the listed deficiencies. AESW still did not provide any supporting documentation concerning the sales of subject goods to Canada or accounting reconciliations for their cost of production. AESW’s additional information also failed to sufficiently address other deficiencies, including providing insufficient documentation to support its domestic sales of like goods.

[72] AESW contacted the CBSA on March 24, 2021, to confirm the status of their Dumping RFI response.^{Footnote 24} On March 25, 2021, the CBSA confirmed with AESW that many of their deficiencies remained insufficiently addressed and that their Dumping RFI response was still considered incomplete by the CBSA as it was still missing information requested in the Dumping RFI.^{Footnote 25} The CBSA explained that AESW’s additional information had not provided any supporting documentation concerning the sales of subject goods to Canada, provided insufficient documentation to support its domestic sales of like goods, and did not provide accounting reconciliations for their cost of production. On March 31, 2021, AESW submitted comments to the CBSA arguing that they had provided all of the missing information and requested that the CBSA specify any additional requirements.^{Footnote 26} On April 7, 2021, the CBSA again provided AESW with a list of deficiencies, reiterating question-by-question, the information that was still missing from their Dumping RFI response that had not been addressed when AESW provided additional information.^{Footnote 27} On April 13, 2021, almost two months after being notified of the deficiencies and at the close of record for the investigation, AESW filed additional information concerning the remaining deficiencies in their Dumping RFI response.^{Footnote 28}

[73] The CBSA had insufficient time prior to the close of record to review and verify this new information by way of further SRFIs or requesting additional supporting documentation. AESW’s delay in filing some of the information missing from its initial RFI response until the close of record prevented the CBSA from being able to further question and verify this information. Without sufficient time to further question AESW, request additional supporting documentation and verify the submitted information, the CBSA was precluded from being able to assess whether or not AESW’s submitted information was complete, accurate and reliable for the purposes of determining a margin of dumping. The CBSA therefore determined that AESW’s information is insufficient and unreliable for the purposes of determining a margin of dumping for the final determination.

[74] Accordingly, for purposes of the final determination the CBSA has determined the margin of dumping for AESW pursuant to a Ministerial Specification based on the methodology as described below under All other exporters rate—Russia.

Balakovo Steel Works JSC

[75] BSW is a producer of rebar in Russia that did not sell or export any subject goods to Canada during the POI. BSW provided a response to the Dumping RFI on February 1, 2021.^{Footnote 29} On February 25, 2021, the CBSA notified BSW that since they had not sold or exported subject goods to Canada during the period of investigation, the CBSA would not be using its Dumping RFI response to determine normal values or a margin of dumping in the investigation.^{Footnote 30} The CBSA further noted that a review of the Dumping RFI response submitted by BSW indicated that the response would be considered incomplete, as the responses to many of the questions concerning the cost of production of the goods were incomplete. On April 13, 2021, at the close of record for the investigation, BSW filed additional information for its Dumping RFI response.^{Footnote 31}

[76] For the final determination, the CBSA confirmed that BSW did not ship subject goods that were released into Canada during the POI. As this investigation focused solely on subject goods released into Canada during the POI, BSW’s information was not relevant to this investigation and was not used.

All other exporters—Russia

[77] As previously stated, the CBSA did not receive complete and reliable responses to the Dumping RFI from any exporters in Russia. As a result, the normal values and export prices for all exporters in Russia were determined pursuant to a ministerial specification under subsection 29(1) of SIMA on the basis of facts available.

[78] In establishing the methodology for estimating normal values and export prices, the CBSA analyzed all the information on the administrative record, including the CBSA’s estimates at the initiation of the investigation, information submitted by exporters of rebar from the named countries and customs documentation.

[79] The CBSA would normally first consider whether information from an exporter of rebar from the applicable country, who provided complete and reliable information, would be appropriate to use as the basis for determining normal values for all other exporters in each respective country.

[80] However, as no exporters in Oman or Russia provided a complete and reliable response to the CBSA’s Dumping RFI, the CBSA instead relied on information from the CBSA’s initiation analysis, based on the methodology of paragraph 19(b) of SIMA, by estimating the costs of production of the goods, an amount for general selling and administrative expenses, plus an amount for profit.^{Footnote 32} Adjustments were made to the cost of raw materials and the cost of labour to more reasonably represent costs which may be incurred in the named countries.

[81] The CBSA considered the highest amount by which the normal value estimated by the CBSA at the initiation of the investigation exceeded the export price as an appropriate basis for determining normal values. This methodology limits the advantage that an exporter may gain from not providing necessary information requested in a dumping investigation.

[82] Export prices were based on the declared selling prices on customs entry documentation. The CBSA considers this the best available information on which to base the export prices for all other exporters as it reflects actual import data.

[83] Using the above methodology, the margin of dumping for all exporters in Russia is determined to be 45.0%, expressed as a percentage of the export price.

Summary of results

[84] A summary of the results of the dumping investigation respecting all subject goods released into Canada during the POI are as follows:

[85] Under paragraph 41(1)(a) of SIMA, the CBSA is required to terminate an investigation in respect of the goods of an exporter if the CBSA is satisfied that the goods have not been dumped or the margin of dumping of the goods of that exporter is insignificant, meaning a margin of dumping that is less than 2% of the export price of the goods.

[86] The goods under investigation have been dumped and the margins of dumping on the goods are greater than the threshold of 2% and are therefore not considered insignificant. As a result, pursuant to paragraph 41(1)(b) of SIMA, the CBSA made a final determination of dumping respecting rebar originating in or exported Oman and Russia.

Timeliness, accuracy and completeness of submissions

Case arguments

Counsels for AltaSteel, AMLPC and Gerdau (collectively, domestic industry) made representations regarding the timeliness, accuracy and completeness of information submitted by exporters, AESW and JSIS. Counsels submitted that AESW and JSIS did not submit information with sufficient time for the CBSA to issue Supplemental Requests for Information (SRFIs) to verify the completeness, reliability and accuracy of the response. Counsels further noted that deficiencies and/or issues remained in the responses of AESW and JSIS.^{Footnote 41}

Counsel for AltaSteel and AMLPC also made representations regarding the completeness of information submitted by importer Ferrostaal Metals GmbH, producer BSW, and trading companies, One Solution Trading Company (ONEST) and America Steel Corporation.^{Footnote 42} Counsel also submitted that BSW was not an exporter of subject goods to Canada and submitted its information too late for the CBSA to analyze, verify and use its information.^{Footnote 43}

Counsel for AESW and BSW submitted that both companies provided the CBSA with timely responses to all requests for information. Counsel for AESW and BSW argued that the sales and cost of production information provided by the companies is substantially complete and accurate, and alleged that this information was successfully verified by the CBSA. Counsel further noted that this information should be used by the CBSA to determine normal values in its final determination, and that the CBSA should issue normal values to both AESW and BSW.^{Footnote 44}

Counsel for JSIS submitted that JSIS provided the requested information as early as possible and the information was sufficient for determining export prices, normal values and a margin of dumping.^{Footnote 45} Counsel for JSIS also submitted methodologies for the determination of export prices, normal values and a margin of dumping.^{Footnote 46}

Reply submissions

In response to AESW’s and BSW’s case arguments, counsels for domestic industry reiterated their arguments that the information provided by AESW was not timely, remained incomplete and was unverified by the CBSA.^{Footnote 47} Counsels for domestic industry repeated that BSW was not an exporter of subject goods to Canada and that CBSA was not required to use its information.^{Footnote 48}

Counsels for domestic industry also disputed JSIS’ arguments that the information submitted was sufficient for determining export prices, normal values and a margin of dumping. Counsels submitted that as noted in their case arguments, deficiencies remained in JSIS’ submissions and the submissions were not provided with sufficient time for the CBSA to verify JSIS’ information.^{Footnote 49}

Counsel for AESW and BSW responded to representations made by counsels for domestic industry, by reasserting that AESW and BSW had submitted complete responses in a timely manner, to the best of their abilities and that CBSA should use their information for the purposes of the final determination and determining normal values.^{Footnote 50}

Counsel for JSIS responded to representations made by counsels for domestic industry, by reasserting that JSIS submitted complete responses in a timely manner, to the best of their ability. JSIS also disputed counsels for domestic industry’s arguments by referencing information in their submissions.^{Footnote 51}

The CBSA did not receive reply submissions from Ferrostaal Metals GmbH, ONEST and America Steel Corporation with respect to the case arguments submitted by counsels for Domestic Industry, on the accuracy and completeness of the submissions.

CBSA’s Response

The CBSA considered all of the information provided by AESW and JSIS. However, the CBSA was not afforded the time to review and verify AESW’s and JSIS’ information by way of further SRFIs or requesting additional supporting documentation, prior to the close of record. Thus the CBSA was precluded from being able to assess whether or not the companies’ submitted information was complete, accurate and reliable, and the CBSA finds that their submissions cannot be used to determine normal values and export prices. The CBSA has determined normal values and export prices for the above exporter’s based on the respective “All Other Exporters—Russia” and “All Other Exporters—Oman” normal value and export price methodologies.

As BSW did not produce or sell subject goods to Canada during the Period of Investigation, the CBSA did not their information in estimating a margin of dumping for the final determination.

The ministerial specification rate

Case arguments

Counsels for domestic industry argued that as the information submitted by exporters, AESW and JSIS, could not be relied upon to calculate export prices and normal values under sections 15, 19 and 24 of the Special Import Measures Act (SIMA), the CBSA should apply a Ministerial Specification under section 29 of SIMA.^{Footnote 52} Counsels submitted that such the CBSA should utilize the methodology to be applied under the Ministerial Specification should follow the methodology used at the preliminary determination with one adjustment. Counsels submitted that the CBSA should use information for Al Jazeera Steel’s 2020 Annual report for purposes of determining costs of direct labour, overhead, general, selling and administrative expenses, financial expenses and amount for profit.^{Footnote 53}

Reply submissions

Counsel for JSIS urged the CBSA to disregard representations made by counsels for domestic industry to use Al Jazeera Steel’s 2020 Annual report in the methodology to be applied under the Ministerial specification, and to use JSIS’s submitted information in determining normal values and export prices.^{Footnote 54}

CBSA’s position

As discussed in the relevant “all other exporters” sections of this document, no exporters in Oman or Russia provided a complete and reliable response to the CBSA’s Dumping RFI. The CBSA instead relied on information from the CBSA’s initiation analysis, based on the methodology of paragraph 19(b) of SIMA, by estimating the costs of production of the goods, an amount for general selling and administrative expenses, plus an amount for profit. Adjustments were made to the cost of raw materials and the cost of labour to more reasonably represent costs which may be incurred in the named countries. This methodology was also used to estimate normal values for the purposes of the preliminary determination.

The CBSA finds that this methodology limits the advantage that an exporter may gain from not providing necessary information requested in a dumping investigation as compared to an exporter that did provide the necessary information.