Commission Decision No 962/98/ECSC of 7 May 1998 repealing Decisions No 1751/94/ECSC and No 55/96/ECSC with respect to the imposition of definitive anti-dumping duties on imports of hematite pig iron originating in Brazil, the Czech Republic, Poland, Russia and the Ukraine
Date: 1998-05-07
Institutions: European Commission
Subjects: anti-dumping duty, cast-iron, export price, import, import price, third country

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COMMISSION DECISION No 962/98/ECSC

of 7 May 1998

repealing Decisions No 1751/94/ECSC and No 55/96/ECSC with respect to the
imposition of definitive anti-dumping duties on imports of hematite pig iron
originating in Brazil, the Czech Republic, Poland, Russia and the Ukraine

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

dumping measures
warranted.

if

the market

situation so

Having regard to the Treaty establishing the European
Coal and Steel Community,

Having regard to Commission Decision No 2277/96/
ECSC of 28 November 1996 on protection against
dumped imports from countries not members of
the
European Coal and Steel Community (1), and in particular
Article 9 thereof,

After consulting the Advisory Committee,

Whereas:

(1)

(2)

(3)

A. PROCEDURE

In July 1994, a definitive anti-dumping duty was
imposed by Commission Decision No 1751/94/
ECSC (2) on imports into the Community of hema-
tite pig iron originating in Brazil, Poland, Russia
and the Ukraine. The amount of the duty was the
difference between the price of ECU 149/tonne
and the free-at-Community-frontier value in all
cases where this value was less than the above
price.

In January 1996, a definitive anti-dumping duty
was imposed by Commission Decision No 55/96/
ECSC (3), with regard to imports into the Com-
munity of hematite pig iron orginating in the
Czech Republic, and an undertaking was accepted
from a specified exporter. The amount of the duty
was set as mentioned above.

In recital 14 of Decision No 1751/94/ECSC and
recital 52 of Decision No 55/96/ECSC it was stated
that in view of the evolutionary character of the
market
situation with regard to the product
concerned, and of the Community interest in safe-
the
guarding the competitiveness of users of
product
to
appeared necessary
it
monitor further developments and possible nega-
tive effects on such users and to review the anti-

concerned,

(1) OJ L 308, 29. 11. 1996, p. 11.
(2) OJ L 182, 16. 7. 1994, p. 37.
(3) OJ L 12, 17. 1. 1996, p. 5.

(4)

(5)

(6)

B. REVIEW INVESTIGATION

In the light of an apparent increase in export prices
which could have repercussions on the dumping
margin and the Community market situation, the
Commission, on 10 April 1996, announced by a
notice published in the Official Journal of the
European Communities (4) its decision to initiate,
on its own initiative, an interim review pursuant to
Article 11(3) of Decision No 2277/96/ECSC (here-
inafter referred to as the ‘Basic Decision’).

The Commission officially advised the Community
industry, exporters/producers,
importers and user
industries known to be concerned and their rep-
resentative associations, as well as the representa-
tives of the exporting countries. All parties directly
concerned were given the opportunity to make
their views known in writing and to request a
hearing within the time limit set in the notice of
initiation.

in that

In view of the large number of exporters/producers
in Brazil, the Commission decided, in accordance
with Article 17 of the Basic Decision, to apply
sampling techniques
the determination of
for
country. The Commission
dumping
contacted all Brazilian exporters/producers known
from the previous anti-dumping proceeding, as well
as their representative association. Those companies
which declared the highest volume of exports to
the Community during 1995 and expressed their
willingness to cooperate were selected, that is to say
a sample of six exporters/producers was initially
considered from the 16 replies
received. No
comments were received from any interested party
with regard to the proposed sample which was
therefore selected as proposed. The companies
eventually included in the sample represented a
major proportion of the total volume of exports to
the Community during 1995.

(7)

The Commission sent questionnaires
to the
selected parties in Brazil and to all parties known
to be concerned in the other exporting countries
covered by the investigation, as well as in the

(4) OJ C 104, 10. 4. 1996, p. 11.

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Community. Replies were received from selected
Brazilian companies, one Czech and two Polish
exporters/producers,
two Community producers,
three unrelated importers, six Community user
companies, and two associations of Community
user industries. No Russian or Ukrainian exporters/
producers cooperated in the investigation.

(8)

The Commission sought and verified all informa-
tion it deemed necessary for the purpose of a deter-
mination of dumping and injury and carried out
verification visits at the premises of the following
companies:

C. PRODUCT

CONCERNED
PRODUCT

AND

LIKE

(10)

The product concerned is the same as in the
previous investigations, that is non-alloy pig iron
containing by weight 0,5 % or less of phosphorus
and currently falling within CN code 7201 10 19
(containing by weight not
than 0,4 % of
manganese and more than 1 % of silicon), and
called hematite pig iron.

less

(a) Community producers:

— DK Recycling und Roheisen GmbH, Duis-

burg (Germany),

— Servola Spa, Trieste (Italy).

(11)

(b) Exporters/producers:

Brazil:

— Calsete, Sete Lagoas,

— Plantar Sider ´urgica SA, Sete Lagoas,

— Sicafe, Sete Lagoas,

— Sider ´urgica Ita-Min Ltda, Sete Lagoas;

Poland:

— Zaklad Wielkopiecowy Szczecin SPZOO

Szczecin,

— Huta Szczecin S.A., Szczecin;

Czech Republic:

— V(cid:146)tkovice as, Ostrava.

Hematite pig iron is used for the production of cast
iron with flake graphite (grey cast iron), in par-
ticular for high quality machine and machine-tool
castings as well as for castings with thermal and
chemical uses.

The Commission found that hematite pig iron
produced and sold by the Community industry has
the same essential physical, chemical,
technical
characteristics and uses as that imported from the
countries concerned. Similarly, hematite pig iron
sold on the domestic markets in Brazil, Poland and
the Czech Republic and that exported to the
Community from the five countries concerned
have the same physical, chemical and technical
characteristics and uses. It was therefore concluded
that hematite pig iron produced and sold in the
exporting countries
concerned is, within the
meaning of Article 1(4) of the Basic Decision, alike
to that exported from those countries
to the
Community and that produced and sold in the
Community.

D. DUMPING

1. Normal value

(c) Unrelated importers:

(a) Brazil

— Frank & Schulte GmbH, Essen (Germany).

(d) User companies in the Community:

— Compagnie

des
Coquille, Rochefort (France),

Fran(cid:135)aise

Fontes

en

— La

Fonte Ardennaise,

Vivier-au-Court

(France),

(12) As mentioned under recital 6, sampling was used
for the determination of normal value. A company
which was initially included in the sample com-
prising six companies failed to provide essential
information. That company was therefore excluded
from the sample and considered to be a non-coo-
perating company.

— Starkey’s Technicast Ltd, Hull

(United

(13)

Kingdom).

(9)

The investigation of dumping covered the period 1
January 1995 to 31 March 1996 (hereinafter
referred to as ‘the investigation period’). The exam-
ination of injury covered the period from 1992 up
to the end of the investigation period.

In the course of the investigation it was found that
one company included in the sample had a close
relationship with another company which also
produced and sold the product concerned and
which was not included in the initial sample. In
view of these corporate links and in order to avoid
circumvention of any anti-dumping measures, that
related company was therefore included in the final
sample, which comprised six companies.

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(14)

(15)

In order to establish normal value, the Commission
analysed whether domestic sales of each selected
exporter/producer in the sample were represent-
ative in accordance with Article 2(2) of the Basic
Decision. For five Brazilian exporters/producers it
was established that the total domestic sales volume
of the product concerned represented at least 5 %
of the sales volume exported to the Community.

those five exporters/producers,

For
it was then
examined whether their domestic sales were made
trade as described in
in the ordinary course of
the Basic Decision. Where the
Article 2(4) of
weighted average selling price was equal
to or
higher than the weighted average unit production
cost and where the volume of sales below unit
production cost was less than 20 % of sales being
used to determine normal value, all sales were
regarded as being made in the ordinary course of
trade and normal value was established on the basis
of the weighted average prices actually paid for all
domestic sales. Where the weighted average selling
price was lower than the weighted average unit
production cost or where the volume of sales made
at a loss was equal to or higher than 20 % of sales
being used to determine normal value, normal
value was established on the basis of the weighted
average prices actually paid for the remaining prof-
itable domestic sales, which represented at
least
10 % of domestic sales of the product.

(16)

The remaining Brazilian exporter/producer in the
sample did not sell the product concerned on the
domestic market during the investigation period.
Therefore, pursuant
the Basic
to Article 2(1) of
Decision,
its normal value was based on the
weighted average of those domestic prices which
were charged by the other five exporters/producers
and which were used to establish normal value for
them.

(b) Russia and the Ukraine

Analogue country

(17)

Since both Russia and the Ukraine are considered
to be non-market economy countries, an analogue
market economy country had to be selected for the
establishment of normal value in accordance with
Article 2(7) of
the Basic Decision. Brazil was
suggested as an appropriate choice, notably for

reasons of similarity of access to raw materials and
energy. Moreover, the Brazilian domestic market is
sufficiently representative in terms of volume. The
Brazilian market also appears to be sufficiently
competitive given the high number of companies
present. Finally, it should be noted that the fact
that Brazil had already been used as the analogue
country in the original anti-dumping investigation
was also taken into consideration. No comments
on the choice of Brazil as an analogue country were
received from any interested party in Russia or the
Ukraine.

(18)

(19)

(20)

Domestic sales

The investigation established that there were suffi-
cient domestic sales made in the ordinary course of
trade of the product concerned by the cooperating
companies in the analogue country within the
meaning of Article 2(2) of the Basic Decision. The
normal value for Russia and Ukraine was therefore
calculated on the basis of the actual prices paid or
payable for sales of the product concerned in the
analogue country, that is Brazil, as described in
recital 15.

(c) Poland

In order to establish normal value, the Commission
made the analysis set out in recital 14. For both
Polish exporters/producers it was established that
the total domestic sales volume of
the product
concerned represented at least 5 % of the sales
volume exported to the Community.

It was then examined whether their domestic sales
were made in the ordinary course of trade pursuant
the Basic Decision. For one
to Article 2(4) of
exporter/producer, profitable domestic sales rep-
resented less than 10 % of its total domestic sales
and they were therefore considered insufficient as a
basis for normal value. In these circumstances, it
was considered appropriate to construct normal
value on the basis of Article 2(3) of the Basic De-
cision by adding to the manufacturing cost of the
product concerned a reasonable amount for selling,
general and administrative expenses and for profit
by adding to the manufacturing cost of the product
concerned a reasonable amount for selling, general
and administration expenses and for profit (which
was established on the basis of profitable sales).

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8. 5. 98

(21)

(22)

for

For the second exporter/producer, the information
concerning its costs was considered unreliable,
notably because the allocation of certain extraord-
inary costs was not duly justified and was therefore
this
disregarded. The profitability analysis
exporter/producer was made by comparing its
domestic selling prices with the unit production
cost established for
the first exporter/producer
since,
in fact, both exporters/producers used the
it was
same production facilities. On this basis,
established that there were sufficient domestic sales
of the product concerned made in the ordinary
course of trade and normal value was established
on the basis of the weighted average prices actually
paid for all domestic sales.

(d) Czech Republic

In order to establish normal value, the Commission
made the analysis set out in recitals 14 and 15. For
the only Czech exporter/producer cooperating in
the investigation, it was established that the total
domestic sales volume of the product concerned
represented more than 5 % of the sales volume
exported to the Community. It was then estab-
lished that the volume of sales made at a loss by
this exporter/producer was higher than 20 % of
sales being used to determine normal value. Con-
sequently, normal value was established on the
basis of the weighted average prices actually paid
for the remaining profitable domestic sales, which
represented more than 10 % of domestic sales of
the product concerned.

2. Export price

(a) Brazil, Poland, Czech Republic

(23) As all cooperating exporters/producers in Brazil,
Poland and the Czech Republic made export sales
in the Community directly to independent
im-
porters, export prices were established on the basis
of the prices actually paid or payable by these inde-
pendent importers, in accordance with Article 2(8)
of the Basic Decision.

(25)

(26)

(27)

(b) Russia and the Ukraine

(28)

(24) As none of the companies concerned in Russia and
the Ukraine cooperated in the proceeding (see
recital 7) the export prices were established on the
basis of
in accordance with
Article 18 of the Basic Decision. In this context, in

the facts available,

the absence of any other information, it was found
that Eurostat data constituted an appropriate basis
for the determination of export prices.

3. Comparison

(a) Brazil

For the purpose of ensuring a fair comparison
between normal value and the export prices of the
companies in the sample, due allowance in the
form of adjustments was made in accordance with
Article 2(10) of the Basic Decision for differences
affecting price comparability, whenever these were
claimed and duly justified. In consequence, adjust-
ments were made for differences in transport, in-
surance, handling,
loading and ancillary costs,
credit costs, and commissions.

(b) Russia and the Ukraine

In accordance with Article 2(10) of the Basic De-
cision, adjustments were made to the Russian and
Ukrainian export prices, which were provided at a
cif at-Community-frontier level, in order to deter-
mine export prices at an fob national-frontier level.
These adjustments duly reflect the average shipping
and insurance costs incurred in transporting the
product concerned from the border of the countries
concerned to the Community border.

(c) Poland

For the purpose of ensuring a fair comparison
between normal value and the export prices of the
cooperating companies, due allowance in the form
of adjustments was made in accordance with
Article 2(10) of the Basic Decision for differences
affecting price comparability, whenever these were
claimed and duly justified. In consequence, adjust-
ments were made for differences in transport, insu-
rance, handling, loading, ancillary costs and credit
costs.

(d) Czech Republic

For the purpose of ensuring a fair comparison
between normal value and the export prices of the
cooperating company, due allowance in the form of
adjustments was made in accordance with Article
2(10) of the Basic Decision for differences affecting
price comparability, whenever these were claimed
and duly justified. In consequence, adjustments
were made for differences in credit costs.

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4. Dumping margin

4,2 %, expressed as a percentage of the cif price at
Community-frontier level.

(a) Brazil

(29)

In general, the Commission made a comparison
between weighted average normal values and the
weighted average export prices of the exporters/
producers.

However, in accordance with Article 2(11) of the
Basic Decision, with regard to three Brazilian
companies, the weighted average normal value was
compared to prices of all export transactions to the
Community because it was found that there was a
pattern of export prices which differed significantly
between different
time periods. Consequently, a
comparison between weighted average normal
values and the weighted average export prices
would not have reflected the full degree of
dumping being practised.

The definitive dumping margins estabished for the
cooperating Brazilian exporters/producers included
in the sample, expressed as a percentage of the cif
price at Community-frontier level, are as follows:

— Calsete

— Sama

— Itasider

— Plantar Sider ´urgica SA

— Sicafe

— Sider ´urgica Ita-Min Ltda

3,3 %

3,3 %

0 %

0 %

6,4 %

0 %.

(32)

(30) As indicated in recital 13, during the investigation
it was found that one company in the sample had a
close relationship with another company which
also produced and sold the product concerned. The
first company owned almost half the shares of the
second, and both companies have common direc-
tors and used the same sales channels. In view of
the close relationship between these two companies
there was a high risk that anti-dumping measures
could be circumvented by channelling exports to
the Community throgh the company with the
lower dumping margin if
two different margins
were established. It was therefore concluded that
only one dumping margin, based on the weighted
average of the dumping margin found for both,
should be estabished for the two companies.

(31)

The dumping margin for the Brazilian companies
which expressed their willingness to cooperate with
the Commission’s
investigation but were not
included in the sample was established, according
to Article 9(6) of the Basic Decision, on the basis of
the weighted average dumping margin found for
the companies in the sample, disregarding zero or
de minimis dumping margins. It was determined at

Those companies are:

— Sider ´urgica Alterosa Ltda,

— Insivi,

— Interlagos Sider ´urgia Ltda,

— Companhia Sider ´urgica Lagoa da Prata,

— Metalsider Ltda,

— Companhia Sider ´urgica Pitangui,

— Siderpa,

— Sider ´urgica Valinho SA,

— Sider ´urgica Uni˜ao Bondespachense,

— Viena Sider ´urgica do Maranh˜ao SA.

The dumping margin for
the non-cooperating
companies, including the company referred to in
recital 12, was established on the basis of the facts
available, in accordance with Article 18 of the Basic
Decision. Given that a comparison of
the data
concerning exports to the Community provided by
all
the cooperating Brazilian exporters/producers
and the Eurostat statistics indicated a very high
level of cooperation, the Commission considered
that the most reasonable facts available were those
established in the investigation and that, since
there was no reason to believe that a non-
cooperating exporter-producer had dumped at a
lower level
the highest
dumping margin for an exporter/producer included
in the sample was the most appropriate for these
purposes. This approach was also considered neces-
sary in order to avoid creating a bonus for non-
cooperation. Thus, for non-cooperating exporters/
producers in Brazil the dmping margin was deter-
mined at 6,5 % expressed as a percentage of the cif
price at Community-frontier level.

than the highest

found,

(b) Russia and the Ukraine

(33)

Pursuant to Article 2(11) of the Basic Decision, the
weighted average normal value established for
Brazil was compared with the weighted average
export price for Russia and the Ukraine as deter-
mined above.

The dumping margins established for Russia and
for the Ukraine were determined to be 2,6 % and
4,0 % respectively, expressed as a percentage of the
cif price at Community-frontier level.

(c) Poland

(34)

The Commission made a comparison between
weighted average normal values and the weighted
average export prices of the exporters/producers in
accordance with Article 2(11) of the Basic Decision.

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it was

The two Polish companies which cooperated with
the present anti-dumping proceeding, Zaklad Wiel-
kopiecowy Szczecin SPZOO and Huta Szczecin SA,
claimed that they were two independent entities.
they were closely
found that
However,
related since they shared managers and workers,
production facilities, offices, and one of the com-
panies holds almost half the shares of the other. In
view of
the close relationship between the two
companies there was a high risk that anti-dumping
measures could be circumvented by channelling
exports to the Community through the company
with the lower dumping margin if two different
therefore
margins were
concluded that only one dumping margin, based
on the weighted average of the dumping found for
both, should be established for the two companies.
The definitive dumping margin established for
these companies, expressed as a percentage of the
cif price at Community-frontier level, is as follows:

established.

It was

— Zaklad Wielkopiecowy Szczecin

SPZOO

— Huta Szczecin SA

12,8 %

12,8 %.

(35)

For any Polish exporter which neither replied to
the Commission’s questionnaire nor otherwise
made itself known, the dumping margin was deter-
mined on the basis of the facts available in ac-
cordance with Article 18(1) of the Basic Deicision.
Given that a comparison of the data concerning
exports to the Community provided by the co-
and the
operating Polish exporters/producers
Eurostat statistics indicated a very high level of
cooperation, the Commission considered, following
the approach set out
the
dumping margin determined for the cooperating
companies was the most appropriate to establish a
dumping margin for non-cooperating companies.
Thus, for non-cooperating exporters/producers in
Poland the dumping margin was fixed at 12,8 %
the cif price at
expressed as a percentage of
Community-frontier level.

in recital 31,

that

(37)

would not have reflected the full degree of
dumping being practised.

The definitive dumping margin established for the
only cooperating exporter in the Czech Republic,
expressed as a percentage of
the cif price at
Community-frontier level, is as follows:

— V(cid:146)tkovice as

7,4 %.

For any Czech exporter which neither replied to
the Commission’s questionnaire nor otherwise
made itself known, the dumping margin was deter-
mined on the basis of the facts available in ac-
cordance with Article 18(1) of the Basic Decision.
Given that a comparison of the data concerning
exports to the Community provided by the co-
operating Czech expoerter and the Eurostat statis-
tics indicated a very high level of cooperation, the
Commission considered, following the approach set
out in recital 31, that the dumping margin deter-
mined for the cooperating company was the most
appropriate to establish a dumping margin for
for
non-cooperating
non-
cooperating exporters/producers
in the Czech
Republic the dumping margin was determined at
7,4 % expressed as a percentage of the cif price at
Community-frontier level.

companies, Thus,

E. COMMUNITY INDUSTRY

(38)

The Commission requested and received informa-
tion from all producers in the Community. The
cooperating producers constitute,
the
Community industry within the meaning of Article
4(1) of the Basic Decision.

therefore,

F. INJURY

1. Preliminary remarks

(d) Czech Republic

(36)

Pursuant to Article 2(11) of the Basic Decision, the
weighted average normal value was compared to
prices of all export transactions to the Community
because it was found that there was a pattern of
export prices which differed significantly among
regions
a
comparison between weighted average normal
values and the weighted average export prices

in the Community. Consequently,

(39)

For the purposes of analysing injury in the present
review investigation, the Commission analysed data
relating to the period from 1992 to 31 March 1996.
Since the investigation period covered 15 months
(1 January 1995 to 31 March 1996) the Commis-
sion adjusted the data for this period to 12 months,
to ensure a proper comparison. The
in order
geographical scope of
the investigation was the
Community composed of 15 Member States. It
should be noted, however, that prior to 1995, infor-
matin relating to certain injury factors (for example,
consumption and market share) was extrapolated
for the three new Member Stats (Austria, Finland
and Sweden).

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(40)

(41)

(42)

(43)

(44)

2. Cumulation

The Commission examined whether imports of
hematite pig-iron imported from Brazil, Poland,
Russia, Ukraine and the Czech Republic should be
assessed cumulatively in accordance with Article
3(4) of the Basic Decision.

In addition, complete segregation by Eurostat of
imports from the former USSR did not take place
until after 1992.

(45)

The market share of the dumped imports from all
countries concerned increased from 53 % in 1992
to 75 % in the investigation period.

of

conditions

The Commission considered that all conditions for
the cumulation of imports from the five countries
concerned set out in Article 3(4) of the Basic Deci-
sion were met, that is the margin of dumping from
each exporting country was more than de minimis,
the volume of imports from each country was not
negligible, and a cumulative assessment of
the
volume of imports was appropriate in the light of
competition between the
the
like Community
and the
imported product
product. The Commission concluded that hematite
pig-iron originating in the five countries concerned
is alike in all respects, is interchangeable and is
marketed in the Community through comparable
similar commercial
sales channels
conditions as the product produced and sold in the
Community. The imported hematite pig-iron is
considered,
to compete with the like
product
imported from each country concerned
and with hematite pig-iron produced and sold in
the Community.

and under

therefore,

The imports from the five countries concerned
were therefore examined cumulatively.

3. Community consumption

The apparent Community consumption was deter-
mined as the sum of sales by the Community
industry on the Community market plus imports
third countries.
into the Community from all
While consumption increased overall between 1992
and the investigation period,
from 826 961 to
989 622 tonnes,
the trend was somewhat erratic
from year to year.

4. Volume and market shares of the dumped

imports

concerned

The volume of dumped imports from all the coun-
tries
from
441 226 tonnes in 1992 to 746 251 tonnes in the
investigation period.

substantially

increased

(46)

(47)

5. Prices of the dumped imports

The weighted average cif prices of all
imports
increased from 1992 up to the investigation period.
The cif prices of
the Brazilian and Ukrainian
imports were above the minimum price of ECU
149/tonnes from the time of
the imposition of
provisional measures (January 1994) onwards. The
prices of
the Polish imports were below the
minimum price in 1994 and increased significantly
thereafter. The prices of the Russian imports were
below the level of the minimum price in 1994 but
increased thereafter. As regards the Czech Re-
public, definitive anti-dumping measures were only
imposed in January 1996 and an undertaking
accepted from a specified exporter/producer at the
the minimum price (ECU 149/tonne).
level of
Therefore,
the measures concerning the Czech
Republic had only been in force for less than three
months at the end of the investigation period of
the present review investigation (31 March 1996).

the exporters/
In order
to determine whether
producers were undercutting the prices of
the
Community producers, the Commission compared
the weighted average prices of
the Community
producers on the Community market with the
comparable weighted average prices of each ex-
porting country, at a comparable level of trade, that
and
is
ex-works Community industry level, customs duty
paid, and an allowance in respect of post importa-
tion expenses and profit on the basis of the infor-
the Com-
mation available. The sales prices of
munity producers considered were those to inde-
pendent customers and adjusted, where necessary,
to ex-works level.

on an ex-warehouse

importer/trader

(48)

The results of this comparison revealed the fol-
lowing undercutting margins during the investiga-
tion period for each country concerned:

— Brazil:
— Poland:
— Russia:
— Ukraine:
— Czech Republic:

3 %
7 %
4 %
7 %
21 %.

The Eurostat data on which these findings are
based did not distinguish between the imports
from the Czech Republic and those from the
the beginning of 1993.
Slovak Republic until
However, available evidence indicates that there is
no pig-iron exporter/producer in the Slovak Re-
public.

6. Situation of the Community industry

Preliminary remarks

(49) During the

anti-dumping investigation which
resulted in measures being imposed on imports of
concerned originating in Brazil,
the product

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Poland, Russia and Ukraine, seven Community
producers were active on the market. Five of those
producers ceased production since 1993.

Four of
those five companies are major Com-
munity steel producers, for which the production of
hematite pig iron was very much ancillary to their
main activity. In the framework of a rationalisation
process, those companies decided to concentrate on
lines and ceased producing
their major product
hematite pig iron. For
the fifth company the
product concerned represented 33 % of its total
production and ferro-manganese 67 % (using the
furnace). The principle reason for
same blast
ceasing production was the company’s decision to
obtain ferro-manganese from other sources and
thus discontinue the operation of the blast furnace.

Therefore, at the end of the investigation period of
the current review investigation, only two Com-
munity producers remained, one of which was in
protective administration throughout most of the
period considered (from 1992 to September 1995)
and was effectively bankrupt. The second company
was in a better financial position but nonetheless
was loss making.

(50) Due to the situation described above, the injury
factors are described separately for the Community
producers as a whole and for the two remaining
Community producers.

Production

tonnes in the investigation period, while the sales
volume of the two remaining Community produ-
cers decreased from 246 476 tonnes in 1992 to
230 867 in 1994 and to 201 673 tonnes in the
investigation period.

Market share

(54)

The development of sales volume compared to that
of apparent Community consumption shows that
the market share held by the Community produ-
cers decreased during the period considered, from
44 % in 1992 to 27 % in 1994 and to 22 % in the
investigation period. The market share held by the
two remaining producers decreased from 30 % in
1992 to 23 % in 1994 and to 20 % during the
investigation period.

Capacity and capacity utilisation

(55) Due to the closure of production facilities, total
production capacity decreased from 1 817 000
tonnes to 991 334 tonnes over the period con-
sidered, a decrease of 45 %. The capacity of the
two remaining producers
remained constant at
890 000 tonnes.

(56) Capacity utilisation rates

are not particularly
meaningful due to the closure of facilities and the
special situation of the producer under protective
administration.

(51) Overall production levels of the product concerned
decreased from 443 724 tonnes in 1992 to 297 527
in 1994 and to 238 154 tonnes in the investigation
period, a decrease of 46 % over the period con-
sidered and a decrease of 20 % between 1994 and
the investigation period. The closure of production
facilities by five Community producers has to be
taken into account when viewing the above data.

(57)

(52)

For
the two remaining Community producers,
production decreased from 273 187 tonnes in 1992
to 253 527 in 1994 and to 232 314 tonnes in the
investigation period, a decrease of 15 % over the
period considered and a decrease of 8 % between
1994 and the investigation period. It should be
noted that the company operating under protective
administration did not produce
the product
concerned for the first nine months of the invest-
igation period.

Stocks

The level of stocks held by the Community produ-
cers decreased from 151 485 tonnes in 1992 to
33 207 tonnes in the investigation period. However,
those figures are not considered meaningful due to
the closure of production facilities and the sub-
sequent sale of stocks held. The level of stocks held
by the two reamining producers shows a decline
from 43 417 to 33 207 tonnes over the period
considered. The producer under protective ad-
from stock for a
ministration continued to sell
period of several months during the investigation
period, while production had ceased.

Price evolution

Sales volume of the Community industry

(53)

The sales volume of all Community producers on
the Community market decreased from 363 882
tonnes in 1992 to 269 867 in 1994 and to 219 693

(58)

The selling prices of the product concerned over
the whole period considered are only available for
the two remaining Community producers. The
weighted average selling prices of
the product
on the Community market
concerned

sold

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the

after

introduction of

decreased from ECU 167/tonne in 1992 to ECU
144/tonne in 1993, increased to ECU 158/tonne in
1994,
anti-dumping
measures, and to ECU 174/tonne in the investiga-
the
tion period. Expressed in percentage terms,
price increase between 1992 and the investigation
period is 4 % and the increase between 1993 and
the investigation period is 21 %.

Profitability

(59)

Profitability figures are only available for the two
remaining companies. The available data shows
that the two companies achieved negative, though
improving,
the period con-
throughout
sidered, with weighted average losses of 36 % of
turnover in 1992, 19 % in 1994 and 7 % during
the investigation period.

results

Employment

(60)

Employment levels for the two remaining com-
panies decreased from 444 in 1992 to 384 in the
investigation period, a decrease of 14 %.

(61)

(62)

Conclusion on injury

The investigation has shown that despite the intro-
duction of anti-dumping measures the Community
industry experienced the closure of production
facilities (although this was mainly due to reasons
other
in
production and sales and loss of market share. The
Community industry did not recover sufficiently to
achieve profits.

than the dumped imports), decreases

G. CAUSATION

1. Preliminary remark

The Commission had, in Decisions No 1751/94/
ECSC and No 55/96/ECSC, estabished that
the
Community industry had suffered injury caused by
dumped imports originating in Brazil, Poland,
Russia, Ukraine and the Czech Republic. In the
present review investigation it was necessary to
examine whether the imports in question con-
tinued to cause material injury to the Community
industry.

2. Effects of the dumped imports

(63) Although a significant increase in the volume of
imports from the countries concerned and in their
market share occurred between 1992 and the inves-
tigation period, the price levels of those imports
increases after the
show,

in general, substantial

(64)

(65)

(66)

(67)

imposition of measures in 1994, reaching levels
above the minimum price.

It should be noted that demand in the Community
has always been far greater than the ability of the
Community producers to supply. At best, before
the closure of production facilities, Community
producers could supply 45 to 50 % of demand. The
Community industry’s main concern was about the
the imports from the countries
price levels of
concerned rather
than their volume or market
share.

The nature of
the Community industry has
changed during the period examined, with five
producers having ceased producing the product
concerned since 1993. While the price of imported
hematite pig-iron may have had an influence, the
decision of those companies to discontinue pro-
ducing the product concerned was not primarily
determined by the imports under consideration.

The production of hematite pig-iron is the main
source of revenue for the two remaining Com-
munity producers. The investigation has shown
that, as previously stated, one company was in
protective administration throughout most of the
period considered and was effectively bankrupt.
The company stopped producing the product
concerned in January 1995 for a period of nine
months.

The second company, although in a better financial
position, was nevertheless loss making throughout
the period considered, mainly because of very high
social costs, due to previous restructuring. A recal-
culation of the profitability of this company with
the elimination of these social costs revealed that,
although losses were evident
in both 1992 and
the company achieved modest profits in
1993,
1994, 1995 and in the investigation period.

3. Conclusion

review,

In conclusion, during the present
the
Commission has established that the nature of the
Community industry has
substantially changed
with only two producers of hematite pig-iron
remaining. The investigation has further shown
that
the remaining producers were experiencing
the period
difficulties before, and throughout,
considered and continued to have negative, though
improving, financial results. However, the difficul-
ties of the Community producers were of a struc-
tural nature and existed independently from the
dumped imports. Despite a significant increase in
the price of the imported product after the imposi-
tion of anti-dumping measures,
the Community
industry remained in difficulty.

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(68)

It is, therefore, concluded that the injury suffered
by the Community industry is not caused by the
dumped imports to any significant degree as it can
be largely attributed to factors other
than the
imports from the countries concerned.

(69)

(70)

(71)

(72)

H. COMMUNITY INTEREST

1. Preliminary remarks

The Commission examined whether or not it is in
the Community interest to maintain the measures
in force or whether it can be concluded that it is in
the interest of the Community to alter or repeal the
measures.

known interested

To this end the Commission sent questionnaires to
all
the
Community industry,
importers/traders and the
user
industry. The Commission received only
limited replies from the users and from importers/
traders of the product concerned.

including

parties,

2. Interests of the Community industry

(a) Nature and structure of

the Community

industry

(normally iron ore and coke)

The Community industry essentially transforms
into
raw material
hematite pig-iron in a blast furnace at temperatures
in excess of 1 000 HC. The liquid iron is then cast
into ‘pigs’ and cooled before storage and subse-
quent sale. Hematite pig-iron is a basic, low tech-
nology, iron product and is itself a raw material
used in the manufacture of grey iron castings.

The Community industry consists of two compa-
nies, one located in the north-east of Italy and the
second in the north west of Germany. Both com-
panies are relatively small, employing a total of 393
people in the investigation period. Hematite pig-
iron is the main product of these companies: it
represented approximately 85 % of the turnover of
each company in the investigation period.

industry
Community consumption.

can supply

approximately 30 % of

(b) Effects of the maintenance or termination of

the measures

(74)

(75)

It has been determined that in view of the nature
of the difficulties experienced by the Community
the Community
is unlikely that
producers,
industry could benefit from these measures.

it

It should be further stressed that in spite of the
imposition of anti-dumping measures and the
consequent substantial price increase,
the com-
panies which had formerly ceased the production
of pig-iron have not resumed this production.

3. Interests of other parties

(76)

In the light of the above conclusions it is not
considered necessary to examine further the impact
of the measures on other interested parties in this
particular case.

I. CONCLUSION

(77) Given the above findings on injury, causation and
Community interest, the anti-dumping proceeding
concerning imports of hematite pig iron origin-
ating in Brazil, the Czech Republic, Poland, Russia
and the Ukraine should be terminated and the
measures should be repealed,

HAS DECIDED AS FOLLOWS:

Article 1

The anti-dumping proceeding concerning imports of
hematite pig iron originating in Brazil, the Czech Re-
public, Poland, Russia and the Ukraine is hereby termi-
nated.

Article 2

Decisions No 1751/94/ECSC and No 55/96/ECSC are
hereby repealed.

(73)

Total production of the product concerned in the
investigation period was approximately 230 000
tonnes, which were sold almost exclusively on the
the Community
Community market. At best,

This Decision shall enter into force on the day following
its publication in the Official Journal of the European
Communities.

Article 3

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This Decision shall be binding in its entirety and directly applicable in all Member
States.

Done at Brussels, 7 May 1998.

For the Commission

Leon BRITTAN

Vice-President