(215)

The parties have not submitted any evidence, apart from allegations and speculations, that in order for the Union industry to increase the production of EO derivatives, it needed to decrease the production of MEG. Indeed, it is not excluded that some of the MEG Union producers increased their production of EO derivatives and, therefore, the consumption of EO to manufacture EO derivatives increased, but this does not mean that this increase was possible only if the MEG production was decreased in parallel. The claim that the Union MEG producers had limited supply of ethylene was unsubstantiated. Some of the Union producers are manufacturing ethylene, they also sell ethylene to other unrelated parties and the sampled MEG Union producers are also connected to a pipeline system (19) for transporting ethylene between Antwerp and Rotterdam, the two largest port and industrial complexes in Europe. Furthermore, the MEG producers are selling EO only in very small volumes as EO is a flammable gas and, therefore, transporting it is dangerous. As explained in the provisional Regulation, the Union industry remains committed to produce MEG in the Union. Despite significant losses of between 8,3 % and 10,2 % in 2019 and between 10,8 % and 13,2 % in the IP, the Union industry still used 65,6 % and 63,8 % of its MEG production capacity in 2019 and the IP respectively when it could have stopped production and focus on other EO derivatives as the parties claimed. Furthermore, the Commission has never acknowledged that the Union industry reduced its production of MEG to produce EO derivatives as they were sold for higher prices than MEG in recital (229) or any other recital in the provisional Regulation, as LCLA stated. In fact, the Commission stated in recital (229) of the provisional Regulation that the Union industry was forced to reduce the production of MEG as its selling price was significantly below the cost of production due to the price pressure exercised by the imports from the countries concerned. The investigation has not revealed any shortages for the main raw material, ethylene, on the side of the Union industry and LCLA has not submitted any evidence that, in order for the Union industry to increase the production of ethylene oxide derivatives, it had to decrease the production of MEG. Therefore, whether the Union industry increased the production of ethylene oxide derivatives has no bearing on this investigation as there is no evidence to show that the only way for the Union industry to achieve such increase was to decrease the volume of MEG. Furthermore, the fact that the Union producers are increasing the production capacities for other products, does not mean that they do not intend to manufacture MEG anymore. The current investigation does not cover the whole ethylene and ethylene oxide supply chain, but only MEG. Therefore, the Commission is not in a position to comment on Arteco’s claim whether the overall ethylene and ethylene oxide supply chain is affected by injury. In any event, the investigation clearly established that the Union industry reduced the production of MEG as of 2019 because of the deteriorating conditions on the MEG market caused by the surge of imports from the countries concerned at low prices.