RB2 2016 IN
Certain Concrete Reinforcing Bar
Statement of Reasons
Ottawa, September 2, 2016
Concerning the Initiation of an Investigation into the Dumping of Certain Concrete Reinforcing Bar Originating in or Exported from the Republic of Belarus, Chinese Taipei, the Hong Kong Special Administrative Region of the People’s Republic of China, Japan, the Portuguese Republic and the Kingdom of Spain
Pursuant to subsection 31(1) of the Special Import Measures Act, the Canada Border Services Agency initiated an investigation on August 19, 2016, respecting the alleged injurious dumping of hot-rolled deformed steel concrete reinforcing bar in straight lengths or coils, commonly identified as rebar, in various diameters up to and including 56.4 millimeters, in various finishes, excluding plain round bar and fabricated rebar products, originating in or exported from the Republic of Belarus, Chinese Taipei, the Hong Kong Special Administrative Region of the People’s Republic of China, Japan, the Portuguese Republic and the Kingdom of Spain. Also excluded is 10 mm diameter (10M) rebar produced to meet the requirements of CSA G30 18.09 (or equivalent standards) that is coated to meet the requirements of epoxy standard ASTM A775/A 775M 04a (or equivalent standards) in lengths from 1 foot (30.48 cm) up to and including 8 feet (243.84 cm).
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 On June 30, 2016, the Canada Border Services Agency (CBSA) received a written complaint from ArcelorMittal Long Products Canada, g.p. (ArcelorMittal LCNA), located in Contrecoeur, Quebec, Gerdau Longsteel North America (Gerdau), located in Whitby, Ontario and AltaSteel Ltd. (AltaSteel), located in Edmonton, Alberta, (hereafter ‘the complainants’), alleging that imports into Canada of certain concrete reinforcing bar originating in or exported from the Republic of Belarus (Belarus), Chinese Taipei, the Hong Kong Special Administrative Region of the People’s Republic of China (Hong Kong), Japan, the Portuguese Republic (Portugal) and the Kingdom of Spain (Spain) (hereinafter “named countries” and “subject goods”) are being dumped. The complainants allege that the dumping has caused injury and is threatening to cause injury to the Canadian industry producing like goods.
 The complainants provided evidence to support the allegations that certain concrete reinforcing bar from Belarus, Chinese Taipei, Hong Kong, Japan, Portugal and Spain has been dumped. The evidence also discloses a reasonable indication that the dumping has caused injury and is threatening to cause injury to the Canadian industry producing like goods.
 On July 21, 2016, pursuant to paragraph 32(1)(a) of the Special Import Measures Act (SIMA), the CBSA informed the complainants that the complaint was properly documented. The CBSA also notified the governments of Belarus, Chinese Taipei, Hong Kong, Japan, Portugal and Spain that a properly documented complaint had been received.
 On August 19, 2016, pursuant to subsection 31(1) of SIMA, the CBSA initiated an investigation respecting the dumping of certain concrete reinforcing bar from the named countries.
 The names and addresses of the complainants are as follows:
ArcelorMittal Long Products Canada, g.p.
4000 Routes des Acieries
Gerdau Longsteel North America
Hopkins Street South
9401 34 Street
ArcelorMittal Long Products Canada, g.p. (ArcelorMittal LCNA)
 ArcelorMittal LCNA is a subsidiary of ArcelorMittal and has eleven steel manufacturing facilities in Canada and the United States of America (US). ArcelorMittal LCNA produces over 5 million metric tonnes (MT) per year and has 3,400 employees. It produces a range of products including rebar, billets, flats, and wire rod.
 ArcelorMittal LCNA operations in Canada produce 2.2 million MT per year and have 1,680 employees. These facilities produce billets and slabs as primary products. For value added products, it produces rebar, wire rod and downstream wire products, flat bar and round bar, and other products. ArcelorMittal LCNA has three rebar manufacturing facilities in Quebec, the Contrecoeur East facility produces rebar in coil form while the Contrecoeur West and the Longueuil facilities produce cut-to-length rebar.
Gerdau Longsteel North America (Gerdau)
 The parent company of Gerdau is Gerdau S.A of Brazil. Gerdau entered the North American market in 1989 with the acquisition of Courtice Steel in Cambridge, Ontario. In 1995, Gerdau acquired MRM Steel in Selkirk Manitoba. In 2002, Gerdau merged its North American operations with Co-Steel of Whitby, Ontario, and the combined entity became Gerdau Ameristeel Corporation. Gerdau acquired 100% ownership of Gerdau Ameristeel in 2010. Gerdau now operates these three Canadian plants, as well as six American plants producing rebar, as Gerdau Longsteel North America, a division of Gerdau Ameristeel.
 Gerdau has manufacturing facilities in Whitby and Cambridge, Ontario and in Selkirk, Manitoba. Gerdau’s three Canadian rebar-producing operations are capable of producing the full range of sizes and grades of rebar. The Whitby plant has produced straight rebar since 1964, as well as other bars and structural shapes. The Cambridge plant has produced straight rebar since 1986. It also produces rounds, squares, channels and angles. Gerdau MRM in Selkirk has produced rebar for over 75 years.
AltaSteel Ltd. (AltaSteel)
 The company now known as AltaSteel was founded in 1955. It has undergone various ownership changes and is now owned by Arrium Limited (previously known as OneSteel Limited).
 AltaSteel is a scrap-based mini-mill with melting and casting manufacturing facilities in Edmonton, Alberta. The company employs over 370 people. AltaSteel makes a variety of round, flat, and square bar shapes for use by downstream manufacturers in the mining, oil and gas, automotive, construction, agriculture and OEM industries.
Max Aicher North America Ltd. (MANA)
 MANA, another producer of rebar, is located in Hamilton, Ontario. MANA’s bar mill produces both hot-rolled bar coils and cut bar lengths. MANA provided their 2015 and first quarter 2016 rebar production information with their letter of support of this complaint.Footnote 1
 The CBSA has identified 28 potential importers of the subject goods from CBSA import documentation and from information submitted in the complaint.
 The CBSA has identified 54 potential exporters of the subject goods from CBSA import documentation and from information submitted in the complaint.
 For the purpose of this investigation, subject goods are defined as:
Hot-rolled deformed steel concrete reinforcing bar in straight lengths or coils, commonly identified as rebar, in various diameters up to and including 56.4 millimeters, in various finishes, excluding plain round bar and fabricated rebar products, originating in or exported from the Republic of Belarus, Chinese Taipei, the Hong Kong Special Administrative Region of the People’s Republic of China, Japan, the Portuguese Republic and the Kingdom of Spain. Also excluded is 10 mm diameter (10M) rebar produced to meet the requirements of CSA G30 18.09 (or equivalent standards) that is coated to meet the requirements of epoxy standard ASTM A775/A 775M 04a (or equivalent standards) in lengths from 1 foot (30.48 cm) up to and including 8 feet (243.84 cm).
Additional Product Information
 For further clarity, the subject goods include 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.
 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.
 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. Fabricated rebar is not included in the product definition of subject goods. Rebar that is simply cut-to-length is not considered to be a fabricated rebar product and it is included in the definition of subject goods.
 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.
 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.
 More specifically, rebar is produced in Canada in accordance with the National Standard of Canada CAN/CSA-G30.18-M92 for Billet-Steel Bars for Concrete Reinforcement (the “National Standard”) published by the CSA Group and approved by the Standards Council of Canada.
 The following are the most common bar designation numbers for the subject goods in Canada, with the corresponding diameter in millimeters (mm) in brackets: 10 (11.3), 15 (16.0), 20 (19.5), 25 (25.2), 30 (29.9) and 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 mm. Other diameters may also be demanded, and other measurement systems employed. For example, Imperial measure #7 bar (approximately 22 mm) is a common designation used in the mine roofing industry.
 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. Welded rebar was a premium product for the domestic industry, reflecting the higher cost of alloy steel; however, since all imports have been weldable products, Canadian production has shifted to weldable rebar as a standard product. Weldable rebar is substitutable for regular rebar in all applications, though the reverse does not hold.
 The National Standard also identifies yield strength levels of 300, 400, and 500. 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.
 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.
 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”. Residential markets primarily use rebar in smaller sizes, while the heavy construction and fabrication markets use most of the larger sizes of rebar.
Classification of Imports
 Imports into Canada of the subject goods are normally classified under the Harmonized System (HS) codes: 7213.10.00.00 and 7214.20.00.00. In some instances, imports of subject goods may also be classified under the following HS codes: 7215.90.00.90 and 7227.90.00.90.
 The listing of HS codes is for convenience of reference only. Refer to the product definition for authoritative details regarding the subject goods.
Period of Investigation
 The complainants submitted that an appropriate period of investigation (POI) for the CBSA to investigate the alleged dumping of subject goods is from June 1, 2015 to May 31, 2016.Footnote 2 It is during this period that the complainants allege they have been materially injured by the presence of dumped goods in the Canadian market. The complainants estimate that the volume of allegedly dumped goods during this period is not negligible.
 The CBSA typically selects a POI that covers a twelve-month period that ends within three months of the date of initiation of an investigation. The complainants’ suggested POI meets both of those conditions. The CBSA is satisfied that this is an appropriate POI for the dumping investigation.
Like Goods and Single Class of Goods
 Subsection 2(1) of SIMA defines “like goods” in relation to any other goods, as goods that are identical in all respects to the other goods, or in the absence of identical goods, goods the uses and other characteristics of which closely resemble those of the other goods.
 In considering the issue of like goods, the Canadian International Trade Tribunal (CITT) typically looks at a number of factors, including the physical characteristics of the goods, their market characteristics and whether the domestic goods fulfill the same customer needs as the subject goods.
 In its past inquiries involving rebar, the CITT determined that domestically produced rebar constituted like goods to the goods at issue.Footnote 3 In particular, the CITT noted:
While rebar comes in a variety of sizes and can be either regular or of a weldable variety, the evidence indicates that rebar is a commodity-type product that is used to reinforce concrete. Further, the evidence indicates that imported rebar is interchangeable with domestically produced rebar. The Tribunal finds that domestically produced rebar is similar to the subject goods in terms of physical characteristics, has the same end uses and is substitutable.
Consequently, for the purposes of this inquiry, the Tribunal finds that rebar produced by the domestic industry, defined in the same manner as the subject goods, constitutes like goods to the rebar imported from the subject countries.Footnote 4
 The complainants maintain that there has been no change of circumstances with respect to the criteria identified by the CITT in the previous proceedings. The CBSA is satisfied that the like goods and subject goods are commodity products that compete with one another in the Canadian marketplace, and are fully interchangeable.
 In addition, the complainants provided the following reasons to support that there is a single class of like goods that are analogous with the scope of subject goods:
In Rebar I, the issue of classes of goods was analyzed at length. The CITT determined there was a single class of goods. In particular, the CITT found that uncoated (or black) rebar and coated rebar constituted a single class of goods. The CITT noted that uncoated and coated rebar are manufactured the same way, have the same general end-use (i.e., concrete applications), must meet the same base ASTM standard which covers the “essential and defining characteristics of the product”, that there is downward substitutability of the coated rebar for applications that require only black rebar, that the price difference between uncoated and coated rebar was not significant, and that uncoated and coated rebar compete in the same market and are distributed by the same distributors or consumed by the same fabricators or customers.
These characteristics have not changed; coated and uncoated rebar continue to have the same physical and market characteristics. The complainants therefore submit that there is a single class of goods.Footnote 5 [Footnotes Omitted]
 Based on the CITT’s reasons in Rebar I Finding (NQ-2014-001), rebar produced by the domestic industry forms a single class of like goods to the subject goods. The CBSA agrees that all domestically produced rebar is “like goods” to the “subject goods” and forms a single class of goods for the purposes of this dumping investigation.
The Canadian Industry
 The domestic industry is comprised of four producers. The complainants, ArcelorMittal LCNA, Gerdau and AltaSteel, represent almost all production of like goods in Canada, with the remainder being attributable to MANA, who supports the complaint.
 In Inquiry NQ-2014-001 involving Rebar I, the CITT also noted that Harris Rebar could be considered a producer of coated rebar. The CITT stated the following with respect to domestic production of like goods:
In this inquiry, it is manifest that the collective production of ArcelorMittal LCNA, AltaSteel and Gerdau accounts for a major proportion of the total domestic production of like goods.
The preponderance of the evidence on the Tribunal’s record indicates that the three domestic producers are responsible for the vast majority, if not all, of the production of uncoated rebar in Canada.
With respect to coated rebar, there is evidence that a rebar fabricator, Harris Rebar, is also a known producer of coated rebar. However, Harris Rebar is primarily a fabricator of rebar and, although the Tribunal has considered the information available on the company’s production volume, the Tribunal finds that the collective production of ArcelorMittal LCNA, AltaSteel and Gerdau accounts for almost all of the total domestic production of rebar (both coated and uncoated). It is therefore appropriate for the Tribunal to conclude that ArcelorMittal LCNA, AltaSteel and Gerdau constitute the domestic industry for the purposes of this inquiry.Footnote 6 [Footnotes Omitted]
 The complainants addressed the potential inclusion of Harris Rebar as a domestic producer in the complaint and indicated that Harris Rebar's sales of coated rebar are not significant in the rebar market in Canada. Further, since the input product used by Harris- i.e., rebar - is itself like or subject goods, the complainants consider the coating process to be a finishing operation rather than production of like goods.”Footnote 7
 Based on the available evidence, the CBSA is satisfied that the complainants’ production of like goods constitutes almost all of the domestic production of like goods.
 Subsection 31(2) of SIMA requires that the following conditions for standing be met in order to initiate an investigation:
- the complaint is supported by domestic producers whose production represents more than 50% of the total production of like goods by those domestic producers who express either support for or opposition to the complaint; and
- the production of the domestic producers who support the complaint represents 25% or more of the total production of like goods by the domestic industry.
 Since the complainants and MANA are the only producers of rebar in Canada, their combined production account for 100% of the total domestic production of like goods. Even if Harris Rebar’s sales of coated rebar are considered to constitute domestic production of like goods, the complaint would still be supported by producers comprising substantially all of the total production of like goods in Canada. Therefore, the CBSA is satisfied that the standing requirements pursuant to subsection 31(2) of SIMA have been met.
 According to the complainants, subject goods and like goods are distributed through the same channels and the conditions of competition apply to all rebar whether produced in the named countries or in Canada.Footnote 8
 The domestic industry markets its rebar to customers across Canada. Rebar may be sold directly to rebar fabricators, or steel service centres/distributors. Rebar fabricators are the major link in the supply chain. They quote jobs to the construction sector, buy the steel, cut and bend to order and deliver to job sites.
 The complainants estimate that approximately 90% of market sales go directly to rebar fabricators. Service centres/distributors purchase rebar in a range of grades and sizes and stock the product for re-sale, primarily to smaller rebar fabricators. Canadian distributors and rebar fabricators may purchase domestically from the Canadian mills, from importers or from other distributors located in Canada or abroad. Service centres/distributors and rebar fabricators may also import directly from mills in the named countries.Footnote 9
 The complainants estimated the domestic market by supplementing their own internal sales information with the information provided by MANA and publicly available import data obtained from Statistics Canada. Global Affairs Canada import permit data was used to estimate April and May 2016 import volumes.Footnote 10
 The CBSA conducted its own independent review of imports of rebar from the CBSA’s (Facility Information Retrieval Management (FIRM)) database as per the HS classification codes under which the subject goods are imported from the named countries. In addition, B3 customs entry supporting documentation was requested from the Trade Compliance Division of the CBSA. The review of customs entry documentation resulted in substantial changes to the import statistics.
 It should be noted that for the purposes of a preliminary determination, the CBSA will further revise the import statistics based on information received from exporters and importers of the subject goods. This information will allow for the removal of any non-subject goods from the statistics while correcting any other errors that may be present in the FIRM data.
 The CBSA’s import data support the complainants’ claims that imports of subject goods into Canada from the named countries have been increasing and are not negligible.
 Detailed information regarding domestic production and the volume of imports of subject goods cannot be divulged for confidentiality reasons. The CBSA, however, has prepared the following table to show the estimated import share of subject goods in Canada.
|2013||2014||2015||Jan. – May 2016||POI (June 2015 to May 2016)|
|Total – Imports Named Countries||0.0%||4.7%||55.8%||63.0%||58.3%|
|Countries named in Rebar I Finding||31.3%||37.8%||0.0%||0.0%||0.0%|
|All Other Countries||0.2%||0.1%||0.6%||1.2%||1.0%|
Evidence of Dumping
 The complainants alleged that subject goods from Belarus, Chinese Taipei, Hong Kong, Japan, Portugal and Spain have been injuriously dumped into Canada. Dumping occurs when the normal value of the goods exceeds the export price to importers in Canada.
 Normal values are generally based on the domestic selling price of like goods in the country of export where competitive market conditions exist or on the full cost of the goods plus a reasonable amount for profits.
 The export price of goods sold to importers in Canada is generally the lesser of the exporter’s selling price and the importer’s purchase price, less all costs, charges, and expenses resulting from the exportation of the goods.
 Estimates of normal value and export price by both the complainants and the CBSA are explained as follows.
 The complainants had limited information on the actual selling prices of the like goods to unrelated purchasers in each of the named countries. They were able to provide some steel industry publications’ reported domestic selling prices for rebar in Chinese Taipei, Japan, Portugal and Spain. However, they were unable to obtain any information regarding domestic selling prices of rebar in Belarus and Hong Kong. As a result, the complainants estimated normal values in accordance with section 15 of SIMA where possible, based on the domestic selling price of like goods in the country of export.
 Regarding the domestic selling price information available for Chinese Taipei and Japan, the reported selling prices as published by MEPS International Steel ReviewFootnote 11 were significantly below the estimated costs of production for rebar in those two countries.Footnote 12 The complainants contended that since the published prices appear to be well below estimated costs of production, the estimates of normal values based on this home market pricing information would be unreliable for the purposes of estimating a margin of dumping.
 Given the difference between the estimated costs and the available pricing for Chinese Taipei and Japan, the CBSA agrees that this pricing may not provide an appropriate comparison, and did not use it for estimating section 15 normal values.
 The complainants provided domestic market rebar pricing for Portugal and Spain from SteelOrbis.Footnote 13 The margin of dumping estimates compared the selling price to Canada, based on Statistics Canada import data, to the home market price reported by SteelOrbis.
 The CBSA found the complainants’ estimated normal values under section 15 of SIMA for Portugal and Spain to be reasonable and representative.
 The complainants also estimated normal values for all subject goods, in accordance with paragraph 19(b) of SIMA, based on the aggregate of the their own costs of production for January 2015 to March 2016 and general, selling and administrative expenses (“GS&A”), financial expenses, and an amount for profits.
 The complainants used quarterly cost data from the period January 2015 to March 2016, lagged one quarter from the arrival of the imports. This one-quarter lag reflects the delay between the time rebar is produced and the time it arrives in Canada. The complainants stated that it is important to match the appropriate cost to the export sale because of the significant variations in the price of scrap metal, the main input in the production of rebar, over the POI.Footnote 14
 The complainants adjusted the labour component of the costs for each named country. An adjustment was made to all labour costs for each of the named countries to reflect the different wage rates paid in those countries compared to Canada. The complainants used information from the International Labour Organization (“ILO”) on wages in the named countries. Where available, the most recent average annual wages were used for each country.Footnote 15
 The complainants’ estimated normal values under paragraph 19(b) of SIMA included GS&A expenses, financial expenses, and an amount for profits. These amounts were determined based on publicly available financial information for a representative producer from each subject country, where available. These producers’ reported earnings before income tax were divided by the cost of goods sold to determine a profit percentage.
 The CBSA considers that for purposes of initiation, the complainants’ estimated average costs were acceptable. The CBSA found the adjustments for labour rates made by the complainants for the named countries to be reasonable and used the same labour adjustments rates when estimating normal values under paragraph 19(b) of SIMA.
 In terms of the GS&A expense amounts that were estimated by the complainants, the CBSA found the amounts for Belarus, Portugal and Spain maybe higher than would be reasonably expected to be incurred by rebar exporters in those countries. The CBSA does not find it reasonable to apply significantly higher GS&A amounts to rebar producers operating in a competitive European market (20.4% for Belarus and 17.4% for Portugal and Spain). The CBSA therefore took a more conservative approach by using the complainants own weighted average GS&A expense amount as a percent of their cost of goods manufacturedFootnote 16 when estimating normal values under paragraph 19(b) of SIMA for these three countries.
 The CBSA used the complainants’ estimated amount of GS&A expenses with respect to Chinese Taipei, Hong Kong and Japan. These amounts were estimated at 3.7%, 7.5% and 10.5% of the cost of goods manufactured, respectively. The CBSA considered these amounts to be reasonable and representative amounts for estimation purposes, as these amounts are in a similar range to the complainants’ own expense levels for rebar.
 Regarding the small amount for financial expenses estimated by the complainants, in order to provide a more conservative and consistent estimate of normal values and margins of dumping, the CBSA did not use any amounts for financial expenses when estimating normal values under paragraph 19(b) of SIMA.
 For the amount for profits, the complainants’ selection of producers used as the source for the amount for profits for Chinese Taipei, Hong Kong, Japan, Portugal and Spain fall within the scope of the hierarchy of profits found in paragraph 11(1)(b) of the Special Import Measures Regulations.
 The amount for profits estimated for Belarus at 22.0% of the total cost of production, was based on the overall profit information from two large Russian steel producers, Severstal PAO and OJSC NovolipetskSteel. Both of these Russian companies are large, fully integrated steel companies with a diverse product mix. Furthermore, their amount for profits is not derived from the sale of goods in Belarus.Footnote 17
 The CBSA concluded that for the purposes of estimating normal values under paragraph 19(b) of SIMA, it was more appropriate to use a simple average of the five amount for profits estimated for the other named countries. This resulted in an estimated amount for profits for constructed normal values in Belarus of 6.1% of the total cost of production of the goods.
 The export price of goods sold to an importer in Canada is generally determined in accordance with section 24 of SIMA as being an amount equal to the lesser of the exporter’s sale price for the goods and the price at which the importer has purchased or agreed to purchase the goods adjusted by deducting all costs, charges, expenses, and duties and taxes resulting from the exportation of the goods.
 The complainants estimated export prices based on publicly available import data obtained from Statistics Canada for HS codes 7213.10.00.00 and 7214.20.00.00 for June 2015 to March 2016. Global Affairs Canada import permit data was used to estimate export prices in April and May 2016.Footnote 18 The complainants estimated an average export price for each named country based on the weighted average declared value for duty per metric tonne for each quarter of the POI. The complainants also estimated a monthly average export price based on Global Affairs Canada import permit data for April and May 2016 for named countries that had importations during those two months.
 The CBSA estimated export prices for each named country based on the value for duty as declared on the customs entry documentation and reported in FIRM for each individual shipment imported into Canada during the POI.
 The CBSA reviewed customs entry documentation for the subject goods imported into Canada for individual transactions. These accounted for 53%Footnote 19 of all imports from the named countries during the POI, based on volume. The CBSA adjusted the FIRM data to correct any errors respecting quantity, value and origin based on the documents submitted by importers and brokers.
Estimated Margins of Dumping
 For purposes of initiation, the CBSA’s estimated margins of dumping was based on estimated normal values under section 15 of SIMA for Spain, and based on estimated normal values under paragraph 19(b) of SIMA for Belarus, Chinese Taipei, Hong Kong, Japan and Portugal. The CBSA compared the weighted average estimated normal value to the weighted average estimated export price for the POI for the subject goods originating in or exported from the named countries.
 Based on the CBSA’s analysis, it is estimated that the subject goods from Belarus, Chinese Taipei, Hong Kong, Japan, Portugal and Spain were dumped. The margins of dumping estimated for each subject country are shown in the table below.
|Country||Margin of Dumping|
Volume of Goods
 Under section 35 of SIMA, if, at any time before making a preliminary determination the CBSA is satisfied that the actual and potential volume of goods of a country is negligible, the CBSA must terminate the investigation with respect to goods of that country.
 Pursuant to subsection 2(1) of SIMA, the volume of goods of a country is considered negligible if it accounts for less than 3% of the total volume of goods that are released into Canada from all countries and that are of the same description as the goods.
 The table below indicates that the estimated import volume for each of the named countries is greater than 3% of total imports during the POI.
|Country||Imports of Goods (mt)||Percentage of Total Imports
|All Other Countries||246,999||41.7%|
Evidence of Injury
 The complainants alleged that the subject goods have been dumped and that such dumping has caused and is threatening to cause material injury to the rebar industry in Canada.
 SIMA refers to material injury caused to the domestic producers of like goods in Canada. The CBSA has accepted that rebar produced by the complainants are like goods to those imported from the named countries.
 In support of their allegations, the complainants provided evidence of price undercutting, erosion and suppression; lost sales and market share; reduced profits; and reduced production and capacity utilization.
Price Undercutting, Erosion and Suppression
 The complainants allege that dumped imports of subject goods have captured market share at the expense of the Canadian industry by aggressively undercutting their prices. Even with the expense of shipping rebar long distances, rebar from the named countries is still priced below the prices offered by the Canadian producers.
 The complainants submitted evidence showing that the average selling prices from the named countries, starting in 2014 to the POI, are substantially lower than those of the complainants, and they are also substantially lower than those of other non-named countries.Footnote 20
 Not only do the average price figures show significantly lower prices for subject goods, but the customer specific evidence gathered by the complainants also reflects substantial price undercutting, erosion and suppression by subject goods. The confidential import reports included in the complaint demonstrate, on a product-by-product basis, that subject goods are the price leaders in the Canadian market and substantially undercut comparable domestic producer pricing.Footnote 21
 The complainants documented numerous specific instances where the prices of subject goods undercut its selling prices of like goods. The complainants identified that this is of particular importance because rebar is a commodity product and purchasing decisions are made primarily on the basis of price.
 The CBSA agrees that allegedly dumped imports from the named countries have forced the complainants to not only reduce their pricing at a rate faster than the decrease of costs, but also prevented the complainants from increasing their pricing when costs rose, all of which have caused the complainants material injury.
 Based on the evidence, the CBSA finds that the complainants’ claims of price undercutting, erosion and suppression are well supported and sufficiently linked to imports of the allegedly dumped goods from the named countries.
Lost Sales and Market Share
 The complainants allege that dumped imports of subject goods have captured market share at the expense of the Canadian industry by offering rebar at low prices that are injurious to the domestic industry.Footnote 22 The complainants noted that from 2013 to 2015, imports from named countries rose from 1 MT to 239,023 MT.Footnote 23
 The complainants noted that, based on their estimated apparent Canadian market, in 2014, the market share of named countries rose while the market share of the domestic producers dropped. In 2015, the named countries captured a large percent of the domestic market share. The complainants allege that the named countries captured market share from countries involved in Rebar I, US imports and Canadian producers.Footnote 24
 The complainants documented numerous specific instances where sales were lost to subject goods in the confidential import activity reports.
 While the CBSA finds that the named countries have increased their market share and that the rate of the increase has been faster than that of the domestic industry, it does not appear that the complainants have lost significant market share in absolute terms over the 2013 to 2015 period. However, in 2016, the complainants have lost some market share to the increasing presence of imports from the named countries. As a result, the CBSA concludes that there is some evidence supporting the complainants’ injury arguments with respect to lost market share. The CBSA finds that the complainants’ claims of lost sales are well supported and sufficiently linked to the imports of the allegedly dumped goods from the named countries.
 The complainants contend that the domestic industry as a whole suffered poor financial performance since 2013. Although their financial performance improved somewhat in 2015, the domestic industry still suffered from combined net losses.Footnote 25 Further, the financial performance of the domestic industry worsened throughout 2015 and early 2016 as imports from the named countries increased.Footnote 26
 The CBSA agrees that the domestic industry as a whole has had poor financial performance and that this is at least partly attributable to the injurious dumping of the subject goods.
 Overall, the complainants’ financial performance is in decline. The complainants’ losses have increased significantly in 2016 at the same time as the named countries have continued to increase their market share. The CBSA concludes that the complainants’ financial losses can be reasonably attributed to the lost sales, price undercutting, price erosion and price suppression resulting from allegedly dumped goods from the named countries.
Reduced Production and Capacity Utilization
 The complainants’ combined rebar production decreased in 2014, but increased in 2015.Footnote 27 The complainants’ total utilization rate (for rebar and other products produced on the same equipment as rebar) decreased from 2013 to 2014 before increasing in 2015.Footnote 28 The complainants still have significant unused capacity.
 In analyzing this information, the CBSA also looked at the data for each complainant individually. For falling production levels and capacity utilization, evidence of injury does exist for one of the complainants. The CBSA finds that this evidence can be reasonably linked to the increased volume of the allegedly dumped imports from the named countries.
CBSA’s Conclusion - Injury Factors
 There is a reasonable indication that material injury has occurred to the domestic rebar industry. The nature of the injury incurred by the complainants is well-documented in terms of price undercutting, erosion and suppression, lost sales and market share, reduced profits, and reduced production and capacity utilization.
Threat of Injury
 The complaint contains reasonable evidence regarding the threat of injury due to increasing import volumes of subject goods from the named countries. The complainants submit that massive excess capacity in the named countries, a soft market, international conditions, relatively high prices in the Canadian market, vulnerability of the Canadian industry based on recent financial performance and the demonstrated propensity of the named countries to dump steel clearly demonstrate that there is a reasonable indication that subject goods threaten the domestic industry with injury.
 Without protection, the complainants believe that the domestic industry will be threatened by imports of subject goods from the named countries. The complainants state that there are two major global developments currently affecting the market for rebar, each of which increases the threat of injury posed by the subject goods to the domestic industry. First, the global economic outlook is weak and the market for rebar is still recovering from the global economic crisis. This global weakening is having a significant impact on the pricing and demand for the subject goods. Second, there is presently massive global overcapacity in the market for rebar, driven primarily by producers in China.
 The CBSA agrees that the evidence shows that global economic outlook is generally weak and the market for rebar is pressured by massive global overcapacity in the steel industry. Furthermore, the CBSA agrees that the evidence shows that current market conditions in Asia and Europe are likely to lead rebar producers to turn to export markets, thereby threatening injury to the Canadian domestic industry.
 As to the named countries’ market conditions, the complainants submitted that their economies are generally weak and slowing. In regards to rebar, the complainants indicated that some named countries have forecasts indicating increases in production volumes, supply imbalances, and excess production capacity.Footnote 29
 The CBSA agrees that the evidence shows that market conditions in the named countries may lead rebar producers to focus on export markets, thereby threatening injury to the Canadian domestic industry.
 In regards to the Canadian market conditions, Canada’s economy is expected to experience slow growth through 2017.Footnote 30 Similarly, rebar demand in Canada is forecasted to grow at a slow pace over the next few years.Footnote 31 Additionally, as a commodity product, price is the primary factor in rebar purchasing decisions. The steel industry itself is capital intensive in nature, requiring high capacity utilization rates to cover fixed costs. Given this combination of factors, the CBSA believes that the pricing pressures on the Canadian domestic industry will continue in the near future.
 Current evidence indicates that the combined current excess capacity of Chinese Taipei, Japan and Spain is approximately 9 million MT.Footnote 32 Further, while production levels are showing growth, rebar demand is expected to remain weak in the named countries. As this trend is expected to continue through 2016, the complainants contend that subject country rebar producers will seek out new export markets including Canada.
 The complainants submit that active sales in Canada by the named countries indicate existing channels of distribution, and therefore, increased risk of dumped subject goods. Based on the evidence provided, the CBSA concurs with this assessment.
 The complainants contend that Canada is an attractive market for producers facing difficult market conditions in their home markets and traditional export markets. Consequently, the named countries will continue to export significant volumes of dumped goods to Canada and that these dumped goods will cause injury in the Canadian domestic industry.
 Relative pricing of rebar in different international markets is a key factor when considering the likely volume of dumped subject goods from the named countries. As Canada’s prices for rebar are generally higher relative to other regions in the world, the complainants submit that the named countries are likely to continue to export significant volumes of rebar to Canada in the near term.
 The CBSA believes that the higher Canadian market prices combined with the named countries excess capacity and weakening home market demand described above, indicate that rebar exporters from the named countries are likely to continue to export substantial volumes of subject goods to the Canadian market.
 The complainants provided a list of findings by Canada against Chinese Taipei and Japan as evidence that certain producers have a propensity to dump to Canada. They also provided a list of trade remedy measures or decisions pending by other countries on various steel products, including rebar, against the named countries.Footnote 33
 The complainants maintain that the presence of these trade remedies further increases the likelihood that these producers would export significant volumes of dumped rebar into Canada in the absence of a finding. Of note is the current European Union investigation related to rebar from Belarus and the final dumping determinations made by Australia related to rebar from Chinese Taipei and Spain.
 The CBSA agrees that certain named countries that are subject to dumping measures with respect to steel in Canada and other markets, including rebar, increases the likelihood of dumped rebar into Canada.
 The complainants state that the volume of rebar imports from the named countries increased from nil in 2013 to 33,301 MT in 2014, increasing to 239,023 MT in 2015.Footnote 34 In Q1 2016, imports from the named countries totalled 16,965 MT, representing slightly more than half of the total 2014 imports from these countries.Footnote 35 April 2016 data indicates that export shipments of subject goods have continued to increase exponentially, reaching 98,650 MT in April alone.Footnote 36
 The share of imports and the share of the Canadian market by the named countries have increased since 2013. Given the evidence provided by the complainants and the evidence available to the CBSA, the CBSA agrees that the volumes of imported subject goods will likely continue to increase.
 When the importations of subject goods enter the Canadian domestic market at prices that are likely to have a depressing or suppressing effect on the price of like goods and are likely to increase demand for further imports of the goods, this results in another threat of injury factor. The prices of subject goods from the named countries have, on average, been consistently lower than those of the complainants. The complainants submit that this is a clear indication that injurious dumping will continue in the absence of a finding.
 The complaint contains reasonable evidence regarding the threat of injury due to increasing import volumes of subject goods from the named countries. The increasing volumes of imports of subject goods at prices that substantially undercut domestic producer pricing will continue to depress or supress domestic prices and threaten to take market share from the Canadian producers. The CBSA is of the view that the adverse volume and price effects of increasing dumped imports threatens to cause domestic producers to suffer further decline in production, capacity utilization, market share, prices, operating income, return on investment and other indicators of material injury.
Causal Link – Dumping and Injury
 The CBSA finds that the complainants have sufficiently linked the injury they have suffered to the alleged dumping of subject goods imported into Canada. The injury includes price undercutting, erosion and suppression; lost sales and market share; reduced profits, and reduced production and capacity utilization.
 The injury relates directly to the price advantage the apparent dumping has produced between the imports of subject goods from the named countries and the like goods produced in Canada. Evidence has been provided to establish this link in the form of price quotes, market data, production figures and financial information related to their production and sales of like goods in Canada.
 The CBSA also finds that the complainants have provided sufficient evidence that there is a reasonable indication that continued alleged dumping of subject goods imported into Canada threaten to cause injury to the Canadian industry producing these goods.
 Based on information provided in the complaint, in combination with the research and analysis conducted by the CBSA, the CBSA is of the opinion that there is evidence that certain concrete reinforcing bar originating in or exported from the Republic of Belarus, Chinese Taipei, the Hong Kong Special Administrative Region of the People’s Republic of China, Japan, the Portuguese Republic and the Kingdom of Spain imported into Canada has been dumped, and there is a reasonable indication that such dumping has caused and is threatening to cause injury to the Canadian industry. As a result, a dumping investigation was initiated in respect of this matter under subsection 31(1) of SIMA on August 19, 2016.
Scope of the Investigation
 The CBSA is conducting an investigation to determine whether the subject goods have been dumped.
 The CBSA requested information from all potential exporters and importers to determine whether or not subject goods imported into Canada, during the period of investigation of June 1, 2015 to May 31, 2016, were dumped. The information requested will be used to determine the normal values, export prices and margins of dumping, if any.
 All parties have been clearly advised of the CBSA’s information requirements and the time frames for providing their responses.
 The CITT will conduct a preliminary inquiry to determine whether the evidence discloses a reasonable indication that the alleged dumping of the goods have caused or are threatening to cause injury to the Canadian industry. The CITT must make its decision on or before the 60th day after the date of the initiation of the investigation. If the CITT concludes that the evidence does not disclose a reasonable indication of injury to the Canadian industry, the investigation will be terminated.
 If the CITT finds that the evidence discloses a reasonable indication of injury to the Canadian industry and the CBSA investigation preliminarily reveals that the goods have been dumped, the CBSA will make a preliminary determination of dumping within 90 days after the date of the initiation of the investigation, by November 17, 2016. Where circumstances warrant, this period may be extended to 135 days from the date of the initiation of the investigation.
 Previously, under section 35 of SIMA, if, at any time before making a preliminary determination, the CBSA was satisfied that there was insufficient evidence of dumping to justify proceeding, the margin of dumping of the goods of a country was insignificant or the actual and potential volume of dumped goods of a country was negligible, the CBSA would terminate the investigation with respect to goods of that country.
 On June 22, 2016, SIMA was amended so that now if, at any time before the CBSA makes a preliminary determination, the CBSA is satisfied that that the volume of goods of a country is negligible, the investigation will be terminated.
 Imports of subject goods released by the CBSA on and after the date of preliminary determination of dumping, other than a preliminary determination in which a determination was made that the margin of dumping is insignificant, may be subject to provisional duty in an amount not greater than the estimated margin of dumping on the imported goods.
 Should the CBSA make a preliminary determination of dumping, the investigation will be continued for the purpose of making a final determination within 90 days after the date of the preliminary determination.
 After the preliminary determination, if, in respect of goods of any country, the CBSA’s investigation reveals that imports of the subject goods have not been dumped or that the margin of dumping is insignificant, the investigation will be terminated.
 If a final determination of dumping is made, the CITT will continue its inquiry and hold public hearings into the question of material injury to the Canadian industry. The CITT is required to make a finding with respect to the goods to which the final determination of dumping applies, not later than 120 days after the CBSA’s preliminary determination.
 In the event of an injury finding by the CITT, imports of subject goods released by the CBSA after that date will be subject to anti-dumping duty equal to the applicable margin of dumping on the imported goods.
Retroactive Duty on Massive Importations
 When the CITT conducts its inquiry concerning injury to the Canadian industry, it may consider if dumped goods that were imported close to or after the initiation of an investigation constitute massive importations over a relatively short period of time and have caused injury to the Canadian industry.
 Should the CITT issue such a finding, anti-dumping duties may be imposed retroactively on subject goods imported into Canada and released by the CBSA during the period of 90 days preceding the day of the CBSA making a preliminary determination of dumping.
 After a preliminary determination of dumping by the CBSA, an exporter may submit a written undertaking to revise selling prices to Canada so that the margin of dumping or the injury caused by the dumping is eliminated. An acceptable undertaking must account for all or substantially all of the exports to Canada of the dumped goods.
 Interested parties may provide comments regarding the acceptability of undertakings within nine days of the receipt of an undertaking by the CBSA. The CBSA will maintain a list of parties who wish to be notified should an undertaking proposal be received. Those who are interested in being notified should provide their name, telephone and fax numbers, mailing address and e-mail address to one of the officers identified in the “Information” section of this document.
 If an undertaking were to be accepted, the investigation and the collection of provisional duties would be suspended. Notwithstanding the acceptance of an undertaking, an exporter may request that the CBSA’s investigation be completed and that the CITT complete its injury inquiry.
 Notice of the initiation of this investigation is being published in the Canada Gazette pursuant to subparagraph 34(1)(a)(ii) of SIMA.
 Interested parties are invited to file written submissions presenting facts, arguments, and evidence that they feel are relevant to the alleged dumping. Written submissions should be forwarded to the attention of the SIMA Registry and Disclosure Unit identified below.
 To be given consideration in this phase of this investigation, all information should be received by the CBSA by January 5, 2017.
 Any information submitted to the CBSA by interested parties concerning this investigation is considered to be public information unless clearly marked “confidential.” Where the submission by an interested party is confidential, a non-confidential version of the submission must be provided at the same time. This non-confidential version will be made available to other interested parties upon request.
 Confidential information submitted to the CBSA will be disclosed on written request to independent counsel for parties to these proceedings, subject to conditions to protect the confidentiality of the information. Confidential information may also be released to the CITT, any court in Canada, or a WTO/NAFTA dispute settlement panel. Additional information respecting the Directorate’s policy on the disclosure of information under SIMA may be obtained by contacting one of the officers identified below or by visiting the CBSA’s Web site.
 The investigation schedule and a complete listing of all exhibits and information are available at http://www.cbsa-asfc.gc.ca/sima-lmsi/i-e/menu-eng.html. The exhibits listing will be updated as new exhibits and information are made available.
 This Statement of Reasons has been provided to persons directly interested in these proceedings. It is also posted on the CBSA’s Web site at the address below. For further information, please contact the officers identified as follows:
SIMA Registry and Disclosure Unit
Trade and Anti-dumping Programs Directorate
Canada Border Services Agency
100 Metcalfe Street, 11th floor
Ottawa, Ontario K1A 0L8
Trade and Anti-dumping Programs Directorate
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