EN
7.6.2023
Official Journal of the European Union
L 147/17
(80)
Considering the sales prices of the Union industry, the Commission noted that a part of the Union production (in particular produced by GrafTech Iberica and GrafTech France) representing around 50 % of the total Union sales and production, was to some extent temporarily shielded from direct market competition, whereas the other part (the other two sampled Union producers) was directly exposed to the dumped Indian imports.
(81)
This situation was due to the existence of LTAs covering sales of GES sourced from GrafTech Iberica.
These LTAs were concluded in the wake of a period of unusually high prices in the years 2017–2018.
These contracts are ‘take or pay’ purchase contracts with a guaranteed level of supplies at set prices and the buyer committed to buy the agreed volumes at the pre-determined and fixed price, subject to various contractual rights and obligations.
The duration of these contracts was three to five years.
It appeared that a very large portion of sales sourced from GrafTech Iberica during the review investigation period were made under these LTAs.
The investigation did not reveal that any other Union producer would covered by similar LTAs in the period considered.
In view of the LTAs’ limited duration, the Commission noted that the impact of the contracts is of a temporary nature.
(82)
The origin of these LTAs is to be found in the period of high price volatility in the years 2017-2018 that stretched up to 2019.
In these years, globally prices of graphite electrodes increased significantly.
This was due to many factors, including increased global demand.
The key reason for the rise in demand cited by the Union industry was to be the global shift in the steel industry, from blast furnaces to the electric arc furnaces, which use graphite electrodes.
In addition, as explained in recital (79), the new competition for needle coke (the main raw material used in the production of graphite electrodes) with the lithium-ion battery industry drove an increase of raw material cost that contributed to the price volatility.
To address this issue of price volatility, the LTAs for the supply of the product under review sourced from GrafTech Iberica were negotiated with a duration between three to five years.
The principle was to obtain more stable prices in exchange for a stable supply as requested by clients.
(83)
Therefore, thanks to the existing LTAs, sales of GrafTech Iberica could be made at a stable price level ([25–50] % above the average unit sales price in the Union) during the review investigation period despite the general fall in prices from which the remainder of the Union industry was not covered by LTAs.
Based on the information available, such as sales volumes of the product under review not subject to LTAs and sourced from GrafTech Iberica as well as the sales of the other two sampled Union producers, the Commission estimated that the average price on the market not covered by the terms of the LTAs was around [25–50] % lower than the average unit sales price in the Union on the total market.
Accordingly, the average Union sales price during the review investigation period does not accurately reflect the competitive price situation on the Union market, which was significantly affected by low-priced and dumped imports from both India and China.
5.4.3.2.
Labour costs (84)
The average labour costs of the sampled Union producers developed over the period considered as follows:
Table 9 Average labour costs per employee 2018
2019
2020
Review investigation period
Average labour costs per employee (EUR)
91 856
87 714
84 993
87 519
Index
100
95
93
95
Source: Questionnaire replies of the sampled Union producers
(85)
The average labour cost slightly decreased over the period considered.
Overall, the average labour cost per employee decreased by 5 %.
This trend was mostly influenced by the limited reduction in employment figures as explained in recital (74).