Proposition de RÈGLEMENT DU CONSEIL instituant un droit antidumping définitif sur les importations de furfural originaire de la République populaire de Chine à l’issue d’un réexamen au titre de l’expiration des mesures effectué en vertu de l’article 11, paragraphe 2, du règlement (CE) n° 1225/2009
Date: 2011-04-13
Institutions: European Commission
Subjects: China, anti-dumping duty, anti-dumping legislation, chemical industry, chemical product

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EUROPEAN COMMISSION 

Brussels, 13.4.2011 
COM(2011) 209 final 

2011/0087 (NLE) 

Proposal for a 

COUNCIL REGULATION  

imposing a definitive anti-dumping duty on imports of furfuraldehyde originating in the 
People's Republic of China following an expiry review pursuant to Article 11(2) of 
Regulation (EC) No 1225/2009 

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EXPLANATORY MEMORANDUM 

1. 

CONTEXT OF THE PROPOSAL 

•  Grounds for and objectives of the proposal 

This  proposal  concerns  the  application  of  Council  Regulation  (EC)  No  1225/2009  of  30 
November  2009  on  protection  against  dumped  imports  from  countries  not  members  of  the 
European  Community1  (‘the  basic  Regulation’)  in  the  expiry  review  proceeding  concerning 
the  anti-dumping  duty  in  force  in  respect  of  imports  of  furfuraldehyde  originating  in  the 
People's Republic of China (‘PRC’). 

•  General context 

This proposal is made in the context of the implementation of the basic Regulation and is the 
result  of  an  investigation  which  was  carried  out  in  line  with  the  substantive  and  procedural 
requirements laid out in the basic Regulation. 

•  Existing provisions in the area of the proposal 

A definitive anti-dumping duty on imports of furfuraldehyde originating in the PRC was first 
imposed  by  Council  Regulation  (EC)  No  95/952,  and  further  confirmed  by  Council 
Regulations (EC) No 2722/19993 and (EC) No 639/20054.  

•  Consistency with other policies and objectives of the Union 

Not applicable. 

2. 

RESULTS OF CONSULTATIONS WITH THE INTERESTED PARTIES AND 
IMPACT ASSESSMENTS 

•  Consultation of interested parties 

Interested  parties  concerned  by  the  proceeding  have  had  the  possibility  to  defend  their 
interests during the investigation, in line with the provisions of the basic Regulation. 

•  Collection and use of expertise 

There was no need for external expertise. 

•  Impact assessment 

This proposal is the result of the implementation of the basic Regulation. 

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OJ L 343, 22.12.2009, p. 51. 
OJ L 15, 21.1.1995, p. 11. 
OJ L 328, 22.12.1999, p. 1. 
OJ L 107, 28.4.2005, p. 1. 

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The  basic  Regulation  does  not  provide  for  a  general  impact  assessment  but  contains  an 
exhaustive list of conditions that have to be assessed. 

3. 

LEGAL ELEMENTS OF THE PROPOSAL 

•  Summary of the proposed action 

On 27 April 2010, the Commission announced by a notice ('Notice of initiation') published in 
the  Official  Journal  of  the  European  Union  an  expiry  review  of  the  anti-dumping  duty  in 
force in respect of imports of furfuraldehyde originating in the PRC, upon the substantiated 
request of two Union producers. 

The  review  investigation  found  continuation  of  dumping  of  the  product  concerned,  which, 
should anti-dumping measures be lifted, would result in the recurrence of injury to the Union 
industry. The investigation also found that allowing the measures to lapse would not be in the 
interest of the Union. 

Therefore,  it  is  suggested  that  the  Council  adopt  the  attached  proposal  for  a  Regulation  in 
order to prolong the existing measures, which should be published in the Official Journal of 
the European Union by 12 May 2011. 

•  Legal basis 

Council Regulation (EC) No 1225/2009 of 30 November 2009 on protection against dumped 
imports from countries not members of the European Community. 

•  Subsidiarity principle 

The proposal falls under the exclusive competence of the European Union. The subsidiarity 
principle therefore does not apply. 

•  Proportionality principle 

The proposal complies with the proportionality principle for the following reasons: 

The  form  of  action  is  described  in  the  basic  Regulation  and  leaves  no  scope  for  national 
decision. 

Indication  of  how  financial  and  administrative  burden  falling  upon  the  Union,  national 
governments, regional and local authorities, economic operators and citizens is minimized and 
proportionate to the objective of the proposal is not applicable. 

•  Choice of instruments 

Proposed instruments: regulation. 

Other means would not be adequate for the following reason: 

The basic Regulation does not provide for alternative options. 

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4. 

BUDGETARY IMPLICATION 

The proposal has no implication for the Union budget. 

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2011/0087 (NLE) 

Proposal for a 

COUNCIL REGULATION (EU) 

imposing a definitive anti-dumping duty on imports of furfuraldehyde originating in the 
People's Republic of China following an expiry review pursuant to Article 11(2) of Regulation 
(EC) No 1225/2009 

THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Treaty on the Functioning of the European Union,  

Having  regard  to  Council  Regulation  (EC)  No  1225/2009  of  30  November  2009  on  protection 
against  dumped  imports  from  countries  not  members  of  the  European  Community5  (‘the  basic 
Regulation’), and in particular Article 11(2) thereof, 

Having  regard  to  the  proposal  submitted  by  the  European  Commission  ('Commission')  after 
consulting the Advisory Committee, 

Whereas: 

A. 

PROCEDURE 

Measures in force 

Following an anti-dumping investigation ('the original investigation'), the Council imposed 
by  Regulation  (EC)  No  95/956  of  21  January  1995  a  definitive  anti-dumping  duty  in  the 
form of a specific duty on imports of furfuraldehyde originating in the People's Republic of 
China  (‘PRC’)  (‘the  definitive  anti-dumping  measures’).  The  specific  duty  rate  was  set  at 
EUR 352 per tonne. 

Following an interim review initiated in May 1997 upon the request of a Chinese exporter, 
the  measures  were  maintained  by  Regulation  (EC)  No  2722/19997  for  a  further  period  of 
four years.  

In  April  2005,  following  an  expiry  review,  the  Council  by  Regulation  (EC)  No 
639/20058extended the measures for a further period of five years. 

Request for an expiry review 

Following  the  publication  of  a  notice  of  impending  expiry9  of  the  definitive  anti-dumping 
measures in force, the Commission received on 28 January 2010 a request for the initiation 
of an expiry review of these measures pursuant to Article 11(2) of the basic Regulation. The 

OJ L 343, 22.12.2009, p. 51. 
OJ L 15, 21.1.1995, p. 11. 
OJ L 328, 22.12.1999, p. 1. 
OJ L 107, 28.4.2005, p. 1. 
OJ C 16, 22.1.2010, p. 40. 

1. 

(1) 

(2) 

(3) 

2. 

(4) 

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request  was  lodged  by  two  Union  producers,  Lenzing  AG  and  Tanin  Sevnica  kemicna 
industrija d.d. ('the applicants'), representing a major proportion of the Union production of 
furfuraldehyde, in this case more than 50%. 

The  request  was  based  on  the  grounds  that  the  expiry  of  the  measures  would  be  likely  to 
result in a continuation of dumping and recurrence of injury to the Union industry. 

Initiation of an expiry review 

Having determined that sufficient evidence existed for the initiation of an expiry review, and 
after consulting the Advisory Committee, the Commission announced on 27 April 2010, by 
a notice published in the Official Journal of the European Union10 ('the Notice of initiation'), 
the initiation of an expiry review pursuant to Article 11(2) of the basic Regulation. 

(5) 

3. 

(6) 

4. 

Investigation  

4.1. 

Investigation period 

(7) 

The investigation concerning the likelihood of a continuation of dumping covered the period 
from  1  April  2009  to  31  March  2010  (‘the  review  investigation  period’  or  ‘RIP’).  The 
examination  of  the  trends  relevant  for  the  assessment  of  the  likelihood  of  a  recurrence  of 
injury covered the period from 1 January 2007 to the end of the review investigation period 
(‘the period considered’). 

4.2. 

Parties concerned by this investigation 

(8) 

(9) 

The  Commission  officially  advised  the  applicants,  exporting  producers  in  the  country 
concerned, importers, users known to be concerned, and the representatives of the country 
concerned of the initiation of the expiry review. 

Interested parties 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. All interested parties, 
who so requested and showed that there were particular reasons why they should be heard, 
were granted a hearing. 

4.3. 

Sampling 

(10) 

In view of the apparent large number of exporting producers in the PRC, it was considered 
appropriate to examine whether sampling should be used, in accordance with Article 17 of 
the basic Regulation. In order to enable the Commission to decide whether sampling would 
be  necessary  and,  if  so,  to  select  a  sample,  the  above  parties  were  requested  to  make 
themselves  known  within  15  days  of  the  initiation  of  the  review  and  to  provide  the 
Commission  with  the  information  requested  in  the  Notice  of  initiation.  Given  that  no 
exporting producers came forward to cooperate, sampling was therefore not necessary. 

4.4. 

Verification of information received 

(11)  The Commission sent questionnaires to all parties known to be concerned and to those who 

made themselves known within the deadlines set in the Notice of initiation. 

10 

OJ C 107, 27.4.2010, p. 10. 

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(12)  Replies  to  the  questionnaires  were  received  from  the  two  Union  producers,  one  importer/ 
user  and  one  producer  in  the  analogue  country,  Argentina.  None  of  the  Chinese  exporting 
producers cooperated in the current investigation. 

(13)  The  Commission  sought  and  verified  all  the  information  it  deemed  necessary  for  a 
determination  of  the  likelihood  of  continuation  or  recurrence  of  dumping  and  resulting 
injury and of the Union interest. Verification visits were carried out at the premises of the 
following interested parties: 

(a)  Union producers 

Lenzing AG, ('Lenzing'), Austria 

Tanin Sevnica kemicna industrija d.d ('Tanin')., Slovenia  

(b)  Unrelated importer/user 

International Furan Chemicals BV ('IFC'), Rotterdam 

B. 

PRODUCT CONCERNED AND LIKE PRODUCT 

1. 

Product concerned 

(14)  The product concerned by this review is the same as the one in the original investigation and 
the  following  reviews  mentioned  above  in  recitals  (2)  and  (3),  namely  furfuraldehyde 
originating  in  the  PRC,  currently  falling  within  CN  code  2932  12  00  (‘the  product 
concerned’). Furfuraldehyde is also known as 2-furaldehyde or furfural. 

(15)  Furfuraldehyde  is  a  light  yellow  liquid  with  a  characteristic  pungent  odour,  which  is 
obtained  by  processing  different  types  of  agricultural  waste.  Furfuraldehyde  has  two  main 
applications:  as  a  selective  solvent  in  petroleum  refining  for  the  production  of  lubricating 
oils and as raw material for processing into furfuryl alcohol, which is used to make synthetic 
resin for foundry moulds. 

2. 

Like product  

(16)  As  in  the  previous  investigations,  this  investigation  confirmed  that  the  furfuraldehyde 
produced in the PRC and exported to the EU, the furfuraldehyde produced and sold on the 
domestic  market  of  the  analogue  country  Argentina  and  the  furfuraldehyde  manufactured 
and  sold  in  the  EU  by  the  Union  producers  have  the  same  basic  physical  and  chemical 
characteristics, and the same basic uses. They were therefore considered to be like products 
within the meaning of Article 1(4) of the basic Regulation. 

C. 

LIKELIHOOD OF CONTINUATION OF DUMPING 

(17) 

In  accordance  with  Article  11(2)  of  the  basic  Regulation,  it  was  examined  whether  the 
expiry  of  the  existing  measures  would  be  likely  to  lead  to  a  continuation  or  recurrence  of 
dumping. 

1. 

General 

(18)  Of  the  34  known  Chinese  exporting  producers  contacted  at  the  initiation,  none  cooperated 
with  the  investigation  and  no  information  was  submitted  by  any  of  these  companies. 
Therefore,  the  findings on the likelihood of continuation  or recurrence of dumping set out 
below  had  to  be  based  on  facts  available,  in  particular  the  information  submitted  by  the 

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cooperating importer/industrial user, Eurostat data, official export statistics of the PRC and 
information in the review request. 

2. 

Analogue country 

(19)  Since  the  PRC  is  an  economy  in  transition  and  in  accordance  with  Article  2(7)(a)  of  the 
basic Regulation, normal value had to be determined on the basis of the price or constructed 
value in an appropriate market economy third country ('the analogue country'), or the price 
from the analogue country to other countries, including the Union, or, where those are not 
possible, on any other reasonable basis, including the price actually paid or payable in the 
Union for the like product, duly adjusted if necessary to include a reasonable profit margin. 

(20)  As  in  the  original  investigation,  Argentina  was  proposed  in  the  Notice  of  initiation  as  an 
appropriate analogue country for the purposes of establishing  normal  value. Following the 
publication  of  the  Notice  of  initiation,  no  comments  concerning  the  proposed  analogue 
country were received. 

(21)  One producer of furfuraldehyde in Argentina cooperated with the investigation by replying 
to  a  questionnaire.  The  investigation  showed  that  Argentina  had  a  competitive  market  for 
furfuraldehyde with around 90% of the market supplied by local production and the rest by 
imports  from  third  countries.  The  production  volume  in  Argentina  constitutes  more  than 
70%  of  the  volume  of  Chinese  exports  of  the  product  concerned  to  the  EU  for  inward 
processing. The Argentinean market was therefore deemed sufficiently representative for the 
determination of normal value for the PRC. 

(22) 

It  is  therefore  concluded,  as  in  the  original  investigation,  that  Argentina  constitutes  an 
appropriate analogue country in accordance with Article 2(7)(a) of the basic Regulation. 

3. 

Dumping of imports during the RIP 

3.1. 

Normal value 

(23)  Pursuant  to  Article  2(7)(a)  of  the  basic  Regulation,  normal  value  was  established  on  the 
basis of the information received from the cooperating producer in the analogue country, i.e. 
on the basis of the price paid or payable on the domestic market of Argentina by unrelated 
customers, since these sales were found to be made in the ordinary course of trade. 

(24)  As  a  result,  normal  value  was  established  as  the  weighted  average  domestic  sales  price  to 

unrelated customers by the cooperating producer in Argentina. 

(25) 

It  was  first  established  whether  the  total  domestic  sales  of  the  like  product  to  independent 
customers were representative in accordance with Article 2(2) of the basic Regulation, i.e. 
whether they accounted for 5% or more of the total sales volume of the product concerned 
exported  to  the  Union.  The  domestic  sales  of  the  cooperating  producer  in  Argentina  were 
considered sufficiently representative during the RIP. 

(26)  The  Commission  subsequently  examined  whether  the  domestic  sales  of  the  like  product 
could be regarded as being sold in the ordinary course of trade pursuant to Article 2(4) of the 
basic Regulation. This was done by establishing for the like product sold on the Argentinean 
market the proportion of profitable domestic sales to independent customers during the RIP. 
Since all sales of the like product during the RIP were profitable, normal value was based on 
weighted average of all domestic sales. 

3.2. 

Export price 

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(27)  As none of the Chinese exporters to the EU cooperated with the investigation, export prices 
were established on the basis of the facts available. The most appropriate basis was found to 
be the information provided by the cooperating importer and the Eurostat data in relation to 
imports  into  the  EU  of  the  product  concerned.  Though  most  of  these  imports  were  made 
under inward processing regime (Chinese furfuraldehyde was further processed into furfuryl 
alcohol for export), there was no reason to believe that they were not a reasonable basis for 
establishing export prices.  

3.3. 

Comparison 

(28)  For  the  purposes  of  ensuring  a  fair  comparison  between  the  normal  value  and  the  export 
price,  and  in  accordance  with  Article  2(10)  of  the  basic  Regulation,  due  allowance  in  the 
form of adjustments was made with regard to certain differences in transport and insurance, 
which affected prices and price comparability. 

3.4. 

Dumping margin 

(29) 

In  accordance  with  Article  2(11)  of  the  basic  Regulation,  the  dumping  margin  was 
established  on  the  basis  of  a  comparison  of  the  weighted  average  normal  value  with  the 
weighted  average  export  prices  at  the  same  level  of  trade.  This  comparison  showed  the 
existence  of  significant  dumping  of  35.6%,  although  lower  than  the  margin  established  in 
the original investigation and subsequent reviews. 

4. 

Development of imports should measures be repealed  

(30)  Further  to  the  analysis  of  the  existence  of  dumping  during  the  RIP,  the  likelihood  of  the 
continuation of dumping should measures be repealed was investigated. Given the fact that 
no  exporting  producer  in  the  PRC  cooperated  in  this  investigation,  the  conclusions  below 
rely  on  facts  available  in  accordance  with  Article  18  of  the  basic  Regulation,  namely  the 
information provided by the cooperating importer, Eurostat data, official export statistics of 
the PRC and the review request. 

(31) 

In this respect the following elements were analysed: development of imports into EU from 
the PRC under the inward processing regime (IPR), development of Chinese exports to third 
countries and the spare capacity of the Chinese producers. 

4.1. 

Development of imports from the PRC 

(32)  According to the Chinese official export statistics the total worldwide exports from the PRC 
of the product concerned increased by 117% during the period considered. This increase was 
mainly absorbed by the US and other third country markets. 

(33)  Concerning the exports to the EU, according to Eurostat and verified import data, it should 
be  noted  that  during  the  RIP,  99,9%  of  all  the  imports  from  the  PRC  of  the  product 
concerned  into  the  EU  were  made  for  inward  processing,  the  remaining  0,1%  for  free 
circulation. There were no imports for free circulation in 2007 and 2008. For completeness 
of  data,  the  imports  for  free  circulation  have  been  taken  into  account  in  the  total  import 
volume,  however,  a  detailed  analysis  of  the  development  of  prices  of  these  imports  was 
considered immaterial due to the negligible volumes involved. 

(34)  The import volume from China under the IPR and free circulation decreased by 67% from 
2007 to the RIP, which coincided with shrinking consumption on the EU market by 24% as 
set  out  in  recital  (45)  below.  The  Chinese  furfuraldehyde  imported  under  IPR  was  further 
processed into furfuryl alcohol which was then exported. There is no information available 

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as  to  how  the  imports  for  free  circulation  have  been  used  in  the  EU,  however,  it  can  be 
reasonably  assumed  that,  should  the  measures  be  repealed,  at  least  part  of  the  current 
imports under IPR could be imported for free circulation as such or as the final downstream 
product (furfuryl alcohol) sold on the EU market. 

(35)  The price of Chinese exports has varied between markets in the period from 2007 to the RIP. 
While there has been a sharp decrease in the export price to the EU (by 11%) in this period, 
the other export markets have experienced an increase of approximately 10%. It is, however, 
notable that the prices for the US market during the RIP have been at roughly the same level 
as to the EU, while, according to the Chinese export statistics, the exports to other markets 
have been by 19% per tonne more expensive. Considering that the product concerned is very 
homogeneous,  such  price  differences  can  only  be  explained  by  the  deliberate  pricing 
strategy  of  Chinese  exporters  who  obtain  higher  prices  and  profits  on  markets  with  less 
competition  than  in  markets  such  as  the  EU  and  the  US  where  lower  prices  are  practised. 
Considering  that  exports  to  EU  and  the  US  constituted  46%  of  total  Chinese  exports,  this 
leads  to  a  conclusion  that  this  price  discrimination  could  be  maintained,  if  duties  were  to 
lapse, in order to sustain dumping at least on the EU market. 

4.2. 

Spare capacity of the exporters 

(36)  Since little public information is available about the Chinese industry of furfuraldehyde, the 
following conclusions rely mainly on the information contained in the review request. 

(37)  According to the request for the expiry review, the Chinese production of furfuraldehyde has 
been steadily increasing since 1999, and in 2009 the production volume reached around 320 
000 tonnes. The Chinese capacity utilisation rate is said to be at around 94% which means 
that there is idle capacity of around 20 000 tonnes per year in the PRC, i.e. approximately 
half of total consumption in the EU. More than 200 production plants of furfuraldehyde are 
said to currently operate in the PRC, of which more and more engage in export activities. 

(38)  Based  on  the  above,  it  can  be  concluded  that,  if  the  measures  were  repealed,  it  can  be 
expected that the exports of the product concerned from the PRC would enter the EU market 
outside  the  inward  processing  regime  in  significant  quantities  and  most  likely  would 
continue being dumped. 

5. 

Conclusion on the likelihood of a continuation of dumping  

(39)  Considering  the  large  production  capacity  available  in  the  PRC,  the  ability  of  Chinese 
producers to increase rapidly the production volumes and direct them for export, as well as 
the pricing of those exports, it is reasonable to assume that a repeal of the measures would 
result  in  a  resumption  of  exports  from  the  PRC  to  the  EU  outside  the  inward  processing 
regime. 

(40)  The  current  export  prices  under  IPR  do  not  bear  the  anti-dumping  duty.  It  is  considered 
therefore  that  such  prices  are  also  indicative  as  to  future  price  levels,  should  measures  be 
repealed.  In  this  regard,  it  was  found  that  Chinese  export  prices  under  inward  processing 
were dumped and were undercutting the Union producers’ prices by 11% in the RIP, as set 
out in recital (70) below. 

(41) 

In view of the findings described above, it can be concluded that the exports from the PRC 
are  still  being  dumped  and  that  there  is  a  likelihood  of  continuation  of  dumping  on  the 
Union market if the current anti-dumping measures were to lapse. 

D. DEFINITION OF THE UNION INDUSTRY 

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(42)  The  Union  industry  ('UI')  consists  of  two  companies:  Lenzing  AG  (Austria)  and  Tanin 
Sevnica  kemicna  industrija  d.d  (Slovenia),  which  together  account  for  100%  of  Union 
production  of  the  product  concerned  in  the  RIP.  Both  companies  replied  to  the 
questionnaires  and  fully  cooperated  in  the  investigation.  On  this  basis,  the  two  Union 
producers constitute the Union industry within the meaning of Article 4(1) and Article 5(4) 
of the basic Regulation. For reasons of confidentiality data concerning the performance of 
the Union industry are given only in indexed form. 

(43)  Compared  to  the  original  investigation,  the  Union  industry  has  significantly  changed: 
Furfural  Español  S.A.  currently  Nutrafur,  the  Spanish  producer  that  lodged  the  original 
complaint in 1994, ceased production in October 2008, while neither Lenzing in Austria nor 
Tanin, the Slovenian company, were part of the EU at that time. Nutrafur, which supports 
the present request for review, has not cooperated in this proceeding. However, Nutrafur is 
still  active  in  the  market,  as  a  trader  buying  the  product  concerned  from  its  former  EU 
competitors. The production figures of Nutrafur in 2007 and 2008 mentioned in the request 
were included in the consumption in the Union market.  

E. SITUATION ON THE UNION MARKET 

1. 

Consumption in the Union market 

(44)  Union consumption of furfuraldehyde was established on the basis of the sales volumes of 
the  Union  industry  on  the  Union  market  (including  the  sales  of  Nutrafur  while  it  was  still 
producing  furfuraldehyde)  plus  imports  under  IPR  from  the  PRC  and  imports  from  other 
third  countries  into  free  circulation,  based  on  verified  data  of  the  importer  International 
Furan  Chemicals  BV  ('IFC')  and  Eurostat.  As  Eurostat  does  not  disclose  the  complete 
information  for  confidentiality  reasons,  Eurostat  data  were  used  only  for  the  imports  from 
other  third  countries  except  China  and  the  Dominican  Republic,  since  IFC  is  the  sole 
importer of furfuraldehyde from these sources.  

(45)  On this basis, during the period considered, the Union consumption decreased by 24%, from 

48 534 tonnes in 2007 to 36 725 tonnes during the RIP.  

Table 1 – Union consumption 

Year 

Tonnes 

2007 

2008 

2009 

RIP 

48 534

45 738

38 175 

36 725

Index (2007=100) 

100

Y/Y trend 

94

-6

79 

-15 

76

-3

Source: verified questionnaire replies of the Union industry and IFC, review request and Eurostat  

2. 

Imports from the PRC 

2.1. 

Volume, market share and prices 

(46)  According  to  Chinese  export  statistics,  during  the  RIP  there  were  only  insignificant  (2,5 
tonnes) Chinese imports for free circulation, most of the Chinese imports being made under 
IPR. The Chinese IPR volume decreased from 8 264 tonnes in 2007 to 2 749 tonnes in the 
RIP,  i.e.  by  67%.  In  2008  Chinese  IPR  imports  reached  a  peak  of  approximately  10 000 

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tonnes  which  decreased  in  the  following  years.  Over  the  period  considered  the  Chinese 
market share for IPR decreased from 17% to 8%, i.e. by 9 percentage points. 

(47)  The Chinese IPR price decreased by 12% from €774 in 2007 to €685 in the RIP. 

Table 2 – Imports from the PRC 

Year 

Tonnes 

Index (2007=100) 

Y/Y trend 

Market share 

Price, €/tonne 

Index (2007=100) 

2007 

2008 

2009 

RIP 

8 264

10 002

5 159 

2 749

100

17%

774

100

121

21

62 

-59 

22%

14% 

33

-29

7%

1 014

690 

685

131

89 

88

Source: Verified questionnaire response of IFC  

3. 

Import volumes and prices from other third countries  

(48) 

It  should  be  noted  that,  as  in  the  original  investigation,  the  imports  from  the  Dominican 
Republic  were  entirely  shipments  from  a  parent  company  to  its  European  subsidiary  to 
produce  furfuryl  alcohol.  Thus,  the  prices  used  in  these  transactions  are  transfer  prices 
between  related  companies  and  did  not  reflect  real  market  prices.  According  to  Eurostat, 
import  volumes  of  furfuraldehyde  into  the  Union  from  countries  other  than  the  PRC, 
together with their average prices, developed as follows:  

Table 3 - Imports into the Union from the Dominican Republic  

Year 

Tonnes 

Index (2007=100) 

Y/Y trend 

Market share 

Price, €/tonne 

Index (2007=100) 

2007 

2008 

2009 

RIP 

32 003

27 662

24 996 

25 959

100

66%

809

100

86

-14

78 

-8 

81

3

60%

65% 

71%

982

582 

670

121

72 

83

Table 4 - Imports into the Union from other third countries  

Year 

2007

2008

2009 

RIP

EN 

12 

   EN 

 
Tonnes 

1 687

1 583

1 226 

1 158

Index (2007=100) 

Y/Y trend 

Market share 

Price, €/tonne 

Index (2007=100) 

100

3%

800

100

94

-6

3%

73 

-21 

3% 

69

-4

3%

997

632 

621

125

79 

78

(49)  During  the  period  considered  the  import  volumes  of  furfuraldehyde  from  the  Dominican 
Republic and all other third countries decreased significantly by 19% and 31% respectively. 
However the decrease of imports from the Dominican Republic still allowed for an increase 
in the market share from 66% to 71%. However all these imports were incorporated in the 
production of furfuryl alcohol by the European subsidiary of the producer in the Dominican 
Republic.  Therefore,  the  prices  of  these  transactions  were  transfer  prices  between  related 
companies and may not reflect real market prices.  

3.1. 

Export volumes and prices from the PRC to other third countries  

(50)  During the period considered export volumes increased by 105% (equivalent to approx. 9% 
of total EU sales in the RIP). It is noted that export sales by the UI to other third countries 
were made at low prices during the RIP. This can be explained by the competition in large 
quantities at low prices with Chinese furfuraldehyde in other third countries.  

Table 5 – Export volumes and prices of the Union Industry to other third countries  

Year 

2007 

2008 

2009 

RIP 

Quantities - Index (2007=100) 

100

Y/Y trend 

Prices - Index (2007=100) 

100

Y/Y trend 

136

36

114

14

211 

75 

88 

-26 

205

-6

82

-6

4. 

Economic situation of the Union industry 

(51)  The economic situation of the Union industry, i.e. the two companies Lenzing and Tanin is 

analysed below.  

4.1. 

Production  

(52)  The  total  production  by  the  Union  industry  of  the  product  concerned  increased  by  14% 

during the period considered. 

Table 6 - Union production 

Year  

2007 

2008 

2009 

RIP 

EN 

13 

   EN 

 
Index (2007=100) 

100

Y/Y trend 

109

9

114 

5 

114

0

Source: Verified questionnaire replies of the Union producers 

4.2. 

Production capacity and capacity utilisation 

(53)  The  total  production  capacity  of  the  Union  industry  remained  the  same  during  the  period 
considered. The capacity utilisation of the Union industry increased by 12 percentage points 
from 85% to 97% meaning that production was almost at full capacity.  

Table 7 - Union capacity 

Year  

2007 

2008 

2009 

RIP 

Index (2007=100) 

Capacity utilisation  

100

85%

100

92%

100 

96% 

100

97%

Source: Verified questionnaire replies of the Union producers 

4.3. 

Level of stocks 

(54)  The  table  below  shows  that  the  level  of  stocks  of  the  Union  industry  increased  by  26% 
during  the  period  considered.  The  increase  of  stocks  was  particularly  significant  between 
2007 and 2008, when stocks increased by 193%.  

Table 8 – Stocks 

Year 

2007 

2008 

2009 

RIP 

Index (2007=100) 

100

Y/Y trend 

293

193

165 

-128 

126

-40

Source: Verified questionnaire replies of the Union producers 

4.4. 

Sales volume and market share 

(55)  The Union industry's sales volume to unrelated customers in the Union market increased by 
13%, during the RIP. Following the increase in sales, the market share of the Union industry 
increased by 5 percentage points during the period considered.  

Table 9 – Sales volume and EU market share 

Year  

2007 

2008 

2009 

RIP 

Index (2007=100) 

100

100

112 

113

Market share ranged 

10-20%

10-20%

14-24% 

15-25%

Source: Verified questionnaire replies of the Union producers 

4.5. 

Average sales prices 

EN 

14 

   EN 

(56)  During the period considered the average sales prices charged by the Union industry on the 
Union  market  decreased  by  1%.  In  2008  the  average  sales  price  reached  a  peak  with  an 
increase of 11%, but then decreased rapidly in the following year. The slight decrease in the 
sales prices must be seen in view of the increase of 5% in the unit cost of production, that 
the UI was not able to take into account.  

Table 10 – Average sales price in the EU 

Year  

2007 

2008 

2009 

RIP 

Index (2007=100) 

100

Y/Y trend 

111

11

98 

-13 

99

1

Source: Verified questionnaire replies of the Union producers 

4.6. 

Average cost of production 

(57)  During the period considered the average cost of production (COP) increased by 5% mainly 
due to the increase in employment and therefore an increase in the total cost of labour.  

Table 11 – Average cost of production 

Year  

2007 

2008 

2009 

RIP 

Index (2007=100) 

100

Y/Y trend 

105

5

105 

0 

105

0

Source: Verified questionnaire replies of the Union producers 

4.7. 

Profitability and cash flow 

(58)  The profits made by the Union industry decreased significantly during the period considered 
together  with  the  cash  flow,  which  decreased  by  56%.  This  was  due  to  pressure  on  sales 
prices, despite the increase both in production and in sales. 

Table 12 – Profitability and cash flow 

Year 

2007 

2008 

2009 

RIP 

Profitability Index (2007=100) 

100

Y/Y trend 

Cash Flow - Index (2007=100) 

100

Y/Y trend 

175

75

144

44

-7 

-182 

49 

-95 

-4

3

44

-5

Source: Verified questionnaire replies of the Union producers 

4.8. 

Investments, return on investments and ability to raise capital 

(59) 

Investments dropped by 95% between 2007 and the RIP. Return on investments, expressed 
as profits/losses of the product concerned in relation to the net book value of investments, 

EN 

15 

   EN 

decreased considerably during the period considered, following the trend of investments. As 
a  result  of  the  deterioration  in  profitability  and  cash  flow,  the  applicants'  ability  to  raise 
capital  has  worsened  significantly  during  the  period  under  consideration.  This  worsening 
can also be clearly seen in the applicants' investments, which fell by 95% during the period 
considered.  

(60)  Table 13 – Investments and return on investments 

Year 

2007 

2008 

2009 

RIP 

Investments index (2007=100) 

100

Y/Y trend 

Return  on  investments  index 
(2007=100) 

100

61

-39

196

2 

-59 

-7 

Y/Y trend 

96

-203 

5

3

-4

3

Source: Verified questionnaire replies of the Union producers 

4.9. 

Employment and productivity 

(61)  The employment level within the Union industry during the period considered increased by 
8%.  Productivity,  measured  as  output  in  tonnes  per  person  employed,  increased  by  6%. 
However, the total labour costs increased by 16% during the period considered. 

Table 14 – Employment and productivity 

Year 

2007 

2008 

2009 

RIP 

Employment - Index  

Productivity 
(tonnes/employees) - Index 

Labour costs - Index 

100

100

100

109

100

109 

105 

108

106

114

115 

116

Source: Verified questionnaire replies of the Union producers 

4.10.  Magnitude of dumping margin 

(62)  Given the volume, the market share and the prices of the dumped imports from the PRC, the 
impact on the Union industry of the actual margins of dumping cannot be considered to be 
negligible. 

4.11.  Recovery from the effects of dumping 

(63)  As shown by the positive evolution of most of the indicators listed above, during the period 
considered  the  financial  situation  of  the  Union  industry  has  partially  recovered  from  the 
injurious effect of dumped imports originating in the PRC. 

4.12.  Growth 

EN 

16 

   EN 

(64)  While  Union  consumption  decreased  by  24%  during  the  period  considered,  the  Union 
industry’s production, sales volume and market share increased over the same period. At the 
same time, the volume and market share of imports from the PRC decreased. However, the 
Union industry could benefit from the measures to a certain extent as the Chinese pressure 
on the sales prices did not allow them to have profits nor to reach their target profit. 

5. 

Conclusion on the economic situation of the Union industry  

(65)  Furfuraldehyde  from  the  Dominican  Republic  is  not  available  on  the  free  Union  market. 
Therefore,  no  indication  was  found  that  these  imports  would  have  contributed  to  the 
precarious  situation  of  the  Union  industry.  With  regard  to  the  imports  of  other  third 
countries their volumes decreased substantially to such a level that, even if made at very low 
prices, their effect cannot be considered to be significant.  

(66)  The measures against the PRC have had a positive impact on the economic situation of the 
Union  industry,  since  most  of  the  injury  indicators  showed  a  positive  development: 
production, sales volume and sales value increased. Despite the decreasing consumption, the 
UI  managed  to  increase  its  market  share.  Profitability,  however,  decreased  substantially 
during  the  RIP.  The  UI  has  not  been  in  a  position  to  achieve  the  target  profit,  set  at  the 
original investigation as being 5% to ensure its development. In that sense, it is concluded 
that  the  UI  has  suffered  material  injury  within  the  meaning  of  Article  3(5)  and  that  its 
financial situation remains vulnerable.  

F. 

LIKELIHOOD OF RECURRENCE OF INJURY 

(67)  Recitals (39) and (40) above concluded that the expiry of the measures would be likely to 

lead to a significant increase of dumped exports from the PRC to the Union. 

(68)  As  mentioned  above,  the  Chinese  producers  have  the  potential  to  redirect  large  export 
volumes  to  the  Union market if measures were repealed. According to the review request, 
the Chinese production capacity reached 320 000 tonnes in 2009 with a spare capacity of at 
least 20 000 tonnes. Moreover, it seems that other export markets, such as Japan, Thailand 
and the USA, could not absorb that spare capacity, which therefore would most probably be 
directed to the Union market. 

(69)  With  regard  to  prices,  the  Chinese  export  statistics  show  that  the  price  of  the  product 
concerned  to  the  USA  was  similar  to  that  of  the  exports  to  the  EU  under  IPR.  To  other 
export markets Chinese prices were higher. 

(70)  However  given  that  the  Chinese  prices  undercut  those  of  the  Union  industry  by  11%,  if 
measures  were  allowed  to  lapse,  it  is  likely  that  the  Chinese  exporters  will  continue  their 
practices in order to regain the lost market share. Such behaviour coupled with their ability 
to deliver significant quantities of the product concerned to the Union market would lead to 
a very negative impact on the Union industry and in particular on its profitability. 

(71)  On the basis of the above, it is concluded that a repeal of measures would in all likelihood 

lead to a recurrence of injury resulting from the dumped imports from the PRC. 

1. 

Preliminary remark 

G. 

UNION INTEREST 

EN 

17 

   EN 

(72) 

In  accordance  with  Article  21  of  the  basic  Regulation,  it  was  examined  whether  the 
maintenance  of  the  existing  anti-dumping  measures  would  be  against  the  interest  of  the 
Union as a whole.  

(73)  The determination of Union interest was based on an appreciation of all the various interests 
involved,  i.e.  those  of  the  Union  industry,  the  importers/traders  as  well  as  the  users  and 
suppliers of the product concerned. 

(74) 

In the previous investigations the adoption of measures was considered not to be against the 
interest  of  the  Union.  Furthermore,  the  present  investigation  is  an  expiry  review,  thus 
analysing a situation in which anti-dumping measures are in place. 

(75)  On  this  basis  it  was  examined  whether,  despite  the  conclusion  on  the  likelihood  of 
continuation of dumping and recurrence of injury, there are compelling reasons which would 
lead  to  the  conclusion  that  it  is  not  in  the  Union  interest  to  maintain  measures  in  this 
particular case. 

2. 

Interest of the Union industry 

(76)  The Union industry has proven to be a viable industry, able to adapt to changing conditions 
on the market. This was confirmed in particular by the positive development of production 
and  sales  in  a  context  of  decreasing  EU  consumption.  However,  due  to  the  enormous 
pressure on the sales prices, profitability could not follow the same positive trend.  

(77)  Given the existing spare capacity for furfuraldehyde in the PRC, combined with the fact that 
other  export  markets  (such  as  Japan,  Thailand  and  the  USA)  cannot  absorb  that  spare 
capacity,  if  the  measures  were  allowed  to  lapse,  the  Chinese  exporters  would  in  all 
likelihood try to regain their lost market share by continuing their dumping behaviour in the 
EU market.  

(78)  Therefore,  without  the  continuation  of  anti-dumping  measures,  the  situation  of  the  Union 
industry  will  in  all  likelihood  severely  deteriorate  due  to  low-priced  dumped  Chinese 
exports as explained above in recitals 66 to 69. 

3. 

Interest of importers  

(79)  Only one importer in the EU cooperated in the proceeding: IFC, a company located in the 
Netherlands and owned by a producer of furfuraldehyde in the Dominican Republic. IFC, is 
the only active importer of furfuraldehyde in the EU, a few other companies only import the 
product concerned occasionally. IFC is the major player in the EU market of furfuraldehyde 
(and of furfuryl alcohol) since it represents around 80% of the consumption in the EU. IFC 
imports  from  the  Dominican  Republic,  from  the  PRC  under  IPR  and  from  other  third 
countries.  Additionally  IFC  is  the  main  customer  of  the  Union  industry  buying 
approximately  32%  of  their  total  sales.  The  furfuraldehyde  purchased  is  then  further 
processed into furfuryl alcohol by TFC, IFC's related company in Geel, Belgium. 

(80)  This importer is fairly neutral regarding the proceeding as on the one hand it would like to 
have access to Chinese furfuraldehyde without any restrictions and the burden of completing 
the  customs  requirements  for  the  IPR,  and  on  the  other  hand  it  would  want  the  Union 
industry to be maintained in order to source the product concerned at short notice. Moreover 
the continuation of measures removes competition with the imports from its parent producer 
in  the  Dominican  Republic  and  consolidates  the  group's  stronghold  on  both  the 
furfuraldehyde and furfuryl alcohol markets (including IPR) in the EU.  

EN 

18 

   EN 

4. 

Interest of users 

(81)  The Commission sent out questionnaires to twenty-seven industrial users of furfuraldehyde. 
Only three users cooperated in the proceeding however they did not source furfuradehyde in 
the PRC but bought it directly from the UI. For these users the importance of furfuraldehyde 
in their business, oil refining or the lube oils industry, is negligible. Therefore they do not 
feel particularly affected by the anti-dumping measures.  

5. 

Conclusion on Union interest 

(82)  Taking into account the above, it is concluded that there are no compelling reasons against 

the maintenance of the current anti-dumping measures. 

H. 

ANTI-DUMPING MEASURES 

(83)  All parties were informed of the essential facts and considerations on the basis of which it 
was  intended  to  recommend  that  the  existing  measures  be  maintained.  They  were  also 
granted a period within which they could make representations subsequent to this disclosure. 
Relevant  comments  submitted  were  analysed  but  have  not  led  to  the  alteration  of  the 
essential facts and considerations on the basis of which it was decided to maintain the anti-
dumping measures. 

(84) 

It follows from the above that, as provided for by Article 11(2) of the basic Regulation, the 
anti-dumping  measures  imposed  by  Regulation  (EC)  No  639/2005  on  imports  of 
furfuraldehyde  originating  in  the  PRC  should  be  maintained.  These  measures  consist  of  a 
specific duty. 

(85)  However,  given  that  this  specific  duty  was  established  on  the  basis  of  the  findings  of  the 
original investigation in 1995 and never revised, it has been considered appropriate to assess 
if the level of the duty is still relevant. In that respect, the Commission has decided to initiate 
ex officio an interim review pursuant to Article 11(3) of the basic Regulation on the day of 
publication of this Regulation, 

HAS ADOPTED THIS REGULATION: 

Article 1 

1. A definitive  anti-dumping duty  is hereby imposed on imports of 2-furaldehyde (also known as 
furfuraldehyde or furfural) currently falling within CN code 2932 12 00 originating in the People’s 
Republic of China. 

2. The amount of duty applicable is EUR 352 per tonne. 

3.  In  cases  where  goods  have  been  damaged  before  entry  into  free  circulation  and,  therefore,  the 
price actually paid or payable is apportioned for the determination of the customs value pursuant to 
Article 145 of Commission Regulation (EEC) No 2454/93 of 2 July 1993 laying down provisions 
for  the  implementation  of  Council  Regulation  (EEC)  No  2913/92  establishing  the  Community 
Customs  Code11,  the  amount  of  the  anti-dumping  duty,  calculated  on  the  basis  of  paragraph  2 
above, shall be reduced by a percentage which corresponds to the apportioning of the price actually 
paid or payable. 

11 

OJ L 253, 11.10.1993, p. 1. 

EN 

19 

   EN 

                                                 
4. Unless otherwise specified, the provisions in force concerning customs duties shall apply. 

This  Regulation  shall  enter  into  force  on  the  day  following  that  of  its  publication  in  the  Official 
Journal of the European Union. 

Article 2 

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

Done at Brussels, 

For the Council 
The President 

EN 

20 

   EN