G/SG/N/6/COL/4  
29 July 2013  
(13-4070)  Page: 1/3  
Committee on Safeguards  Original: Spanish  
 
  NOTIFICATION UNDER ARTICLE 12.1(A) OF THE AGREEMENT 
ON SAFEGUARDS ON INITIATI ON OF AN INVESTIGATION 
AND THE REASONS FOR IT 
COLOMBIA  
(Steel Wire Rod*) 
The following communication, dated 26 July 2013, is being circulated at the request of the 
delegation of Colombia. 
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Pursuant to Article 12.1(a) of the WTO Agreement on Safeguards, Colombia hereby notifies the 
initiation of the following safeguards investigation in accordance with the regulations established in its domestic legislation - Decree No. 152 of 1998. 
 
1. Date when the investigation was initiated 
The investigation was initiated on 17 July 2013 under Initiating Resolution ( Resolución de 
Apertura ) No. 160 of 17 July 2013, published in Colombian Official Journal No. 48.856 
of 19 July 2013.
1 
 2. Product involved 
The product under investigation is steel wire rod, commercially known as alambrón trefilable 
(drawable wire rod), which is classified in the National Customs Tariff (Decree No. 4927 of 2011) under the following subheadings: 
PRODUCT  SUBHEADING
 DESCRIPTION (ADAPTED TEXT)  
Steel wire  
rod 
 7213.20.00.00 Bars and rods, hot-rolled, in irregularly wound coils, of non-alloy  
free-cutting steel 
7213.91.10.00 Bars and rods, hot-rolled, in irregularly wound coils, of iron  
or non-alloy steel, of circular cross-section measuring less than  
14 mm in diameter, containing by weight less than 0.12%  
of chromium, nickel, copper and molybdenum taken together 
7213.91.90.00 Other bars and rods, hot-rolled, in irregularly wound coils, of iron  
or non-alloy steel, of circular cross-section measuring less than  
14 mm in diameter  
7213.99.00.10 Other bars and rods, hot-rolled, in irregularly wound coils, of iron  
or non-alloy steel, containing by weight less than 0.12% of chromium,  
nickel, copper and molybdenum taken together 
7213.99.00.90 Other bars and rods, hot-rolled, in irregularly wound coils, of iron  
or non-alloy steel 
7227.90.00.10 Other bars and rods, hot-rolled, in irregularly wound coils, of boron  
alloy steel 
                                               
* Defined in the Harmonized Commodity Description and Coding System (HS), fifth edition (2012), 
as "Bars and rods, hot-rolled, in irregularly wound coils, of … steel". 
1 http://www.imprenta.gov.co/diariop/diario2.nivel_3 G/SG/N/6/COL/4 
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3. Reasons for the initiation of investigation 
(i)  Request 
 
The investigation request was submitted by the company ACERÍAS PAZ DEL RÍO S.A., 
which accounts for 77% of the domestic output of bars and rods classified under tariff subheadings 7213.20.00.00, 7213.91.10.00, 7213.91.90.00, 7213.99.00.10, 7213.99.00.90 
and 7227.90.00.10. 
 
(ii)  Evidence on the basis of wh ich the investigation was initiated 
 
 Analysis of imports 
 The behaviour of total imports during the years 2010 and 2011 shall be taken as the historical 
reference, while the year 2012 shall be considered as the most recent or critical period in which 
imports have increased in such quantities and under such conditions as to cause or threaten to cause injury to the domestic industry. 
 
Between the reference period and the two halv es of 2012, average imports rose by 33.35% 
from 74,435 tonnes to 99,262 tonnes, an increase of 24,826 tonnes.  
The six-monthly analysis shows steady growth be tween the first half of 2010 and the first half 
of 2011, with increases of 62.46% and 12.95% resp ectively. In the first and the second half 
of 2012, total imports continued to rise by 13.68% and 2.24%, reaching 100,359,828 kg, 
a volume higher than that recorded in 2010 and 2011. 
 
 Analysis of injury indicators 
 
In order to analyse the impact that the imports had on the domestic industry in the first and second half of 2012 (critical period), the average for these periods was compared with the average for the first and second halves of 2010 and 2011 (reference period). 
 
The comparison of the reference period with the crit ical period found sufficient indication of serious 
injury in the poor performance of the domestic industry in respect of the following variables: 
volume of production, volume of production in re lation to Apparent Domestic Consumption (ADC), 
volume of domestic sales, net sales revenue, gross profit margin, operating profit margin, total imports in relation to the volume of production destined for the domestic market, final domestic 
sales inventory, installed capacity utilization, productivity, direct employment, sales of domestic 
producers in relation to ADC, and total imports in relation to ADC.  When comparing the behaviour of financial variables, at biannual level, for the production of steel 
wire rod, injury was found in respect of: (1) gross profit margin, (2) operating profit margin, 
(3) net sales, (4) gross profit, and (5) operating profit.  
 Causal link 
 Since the second half of 2011, the domestic producers' market share has decreased, 
while the volume of imports has steadily increase d. This was most notable in the first and the 
second half of 2012. The market growth recorded in the first half of 2012 positioned imports in such a way as to displace domestic producers.  
The domestic sales component of ADC showed a lo ss of market share of 12.28 percentage points 
between the reference period and the critical period, while other domestic producers lost 3.67 percentage points during the same periods. 
 
Total imports gained 15.95 percentage points between the reference period and the critical period, thus displacing domestic producers in the first and the second half of 2012, with imports 
increasing by 33.35%. 
 G/SG/N/6/COL/4 
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  As for the domestic industry's ability to supply the domestic market for wire rod products, it was 
able to cover 96.49% of the market in the reference period and 97.66% of the market in 2012. These figures refer exclusively to ACERÍAS PAZ DEL RÍO S.A., which accounts for 77% of the domestic industry. 
 
(iii) Evidence of critical circumstances 
 
Pursuant to domestic legislation (Article 33 of  Decree No. 152 of 1998), and in accordance with 
Article 6 of the WTO Agreement on Safeguards, a study was conducted in order to analyse the behaviour of indicators of critical circumstances. The study focused on variables in respect of inventories, domestic sales, and gross and operating profit, which were taken from the 
economic and financial information, by line of production, provided by ACERÍAS PAZ DEL RÍO S.A. 
The study compared the performance of each  of these indicators between the first 
and the second half of 2012, in the light of the increase in imports in that year. 
 
The comparison showed evidence of critical circ umstances: a decline of 27.29% in domestic sales 
indicators, an increase of 396% in the final inventory of the finished product, a drop 
of 12.30 percentage points in the gross profit ma rgin, and a reduction of 15.33 percentage points 
in the operating profit margin.  Between the first and the second half of 2012, the volume of total imports rose by 2,194,468 kg, 
from 98,165,361 kg to 100,359,829 kg. 
 In any case, between the reference period and the two halves of 2012, average imports rose 
by 33.35%, from 74,435 tonnes to 99,262 tonnes, an increase of 24,826 tonnes. 
 Per unit import prices in the two halves of 2012 fell by 6.62% from US$0.73/kg to US$0.68/kg, 
which amounts to US$730/tonne in the first half of the year and US$680/tonne in the second. 
 4. Point of contact for the investigation and preferred means of communication 
Subdirección de Prácticas Comerciales  (SubDirectorate of Trade Practices) 
Calle 28 Nº 13A -15, Piso 3 
Bogotá, D.C. Tel.: (571) 6067676, Ext. 2225 and 1694 
Fax: (571) 6069944 
E-mail: efernandez@mincit.gov.co  and rrojas@mincit.gov.co  
 
5. Deadlines and procedures for importers, ex porters and other interested parties to 
present evidence and their views 
On 22 July 2013, the Foreign Trade Directorate of the Ministry of Commerce, Industry 
and Tourism, via the national newspapers El Nuevo Siglo  and La República , invited the parties 
concerned by the investigation to express their du ly substantiated views and to submit or request 
any evidence and documents that they considered relevant within thirty (30) working days from the first working day following the date of publication of the invitation. 
 
Furthermore, on 24 July 2013, the SubDirectorate  of Trade Practices sent communications to the 
interested parties informing them of the initiation of the investigation and requesting them 
to complete questionnaires, which must be returned within thirty (30) working days from the 
first working day following the date they were sent. These questionnaires may be downloaded from the following address: http://www.mincomercio.gov.co/publicaciones.php?id=7360 . 
 
Neither a date nor a place has yet been decided for the public hearing. This information will be 
announced to interested parties in a communication and via the website of the Ministry of Commerce, Industry and Tourism. 
 
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