Continuation or Recurrence of Dumping
Export Price
18. Pacific Steel has estimated ex-factory export prices based on statistical data for Thai exports in 2007. The base prices have been adjusted using evidence supplied to the Ministry in 2003 to initiate the original dumping investigation and in some instances contained in the Ministry's 2004 final report of the investigation, which has been updated to an equivalent 2007 amount by the Thai inflation rate.
19. Pacific Steel has been unable to provide New Zealand based statistical information to estimate export prices because import statistics on two tariff items and three statistical keys (7213.91.90.09, 7214.20.90.01 and 7214.20.90.05) are suppressed by Statistics New Zealand. Pacific Steel was also aware, from information provided by the Ministry, that across all relevant tariff items there have been no exports of reinforcing steel bar and coil from Thailand to New Zealand since October 2006. Pacific Steel has used data relating to Thailand's other export markets to estimate export prices.
20. Pacific Steel has sourced information on Thailand's exports from an online international trade database, TradeMap7. TradeMap has been developed by the International Trade Centre UNCTAD/WTO (ITC).
21. Pacific Steel has provided the export statistics to all destinations in 2007 for one tariff reference, namely 7214.20, at the six digit level. A major proportion of reinforcing steel bar and coil from all sources has entered New Zealand under this tariff subheading over the past three years. The statistical data shows, in addition to other data, the importing country, annual export volume and the Free on Board (FOB) value in United States Dollars (USD). Pacific Steel has converted the export volume of short tons to metric tonnes and converted the USD value to Thai Baht (THB) to establish FOB values per metric tonne for all export destinations and seven individual export destinations (these being the only recorded export destinations during 2007).
22. The table showing TradeMap data provided by Pacific Steel has been checked against Trademap's website database. At the time this check was made the latest yearly statistical data on TradeMap was for the calendar year 2007. An inquiry on quarterly data revealed statistical data is available from the third quarter 2007 to the third quarter of 2008 but the data is too sparse to provide any particularly more meaningful figures than those provided by Pacific Steel.
23. The TradeMap data is expressed in US dollars (USD). Pacific Steel has used an exchange rate of USD1: THB32.31325 to convert values to Thai baht (THB). The explanatory notes on TradeMap state that exchange rates are sourced from Oanda8. A check on the Oanda website shows an average exchange rate for 2007 of USD1: THB32.53008 which is not too dissimilar to that used by Pacific Steel.
24. Pacific Steel has assumed the term ‘tons' refers to short tons and on this basis has recalculated the export volume figures to express metric tonnes. The recording of volumes on TradeMap has been questioned in the past by the Ministry and TradeMap has confirmed that the statistical data on steel refers to metric tonnes not short tons. No conversion is therefore required and the assessment team has removed Pacific Steel's conversion calculation from its calculation of export price, resulting in a reduced base price.
25. Pacific Steel provided a line graph of world steel prices from January 2006 to November 2008 based on data sourced from Steel Business Briefing. The line graph shows a steady increase in prices from January 2006 to January 2008, then a sharp increase peaking around July 2008 followed by a sharp decrease to November 2008. Pacific Steel has considered the significant rise and fall of world steel prices in 2008 and industry comments relating to these changes. Pacific Steel is of the opinion that since prices have recently moved back to 2007 levels, and 2007 was relatively stable for prices, it would be sensible and reasonable to use data from 2007 for its application, which it claims is in any case the latest available data. Since a review is a forward looking exercise and investigates whether dumping would recur if the anti-dumping duties were removed, the assessment team considers it is reasonable to use the average price in 2007 for purposes of an application for a review.
26. To establish ex-factory export prices, Pacific Steel has reduced the FOB values per tonne by a cost of credit (calculated as xxxx days at xxxx percent), customs costs, terminal handling charges, lift off at port charges, transport to port costs, lift on at works charges, equipment hire costs, export labelling and bar marking costs. Pacific Steel has calculated total adjustments as THBxxxx which is equivalent to xxxx percent of the FOB value. Pacific Steel has used the adjustments it provided in the original dumping investigation initiated in 2003, which have been adjusted to 2007 by the Thai inflation rate between 2003 and 2007 of 15 percent9.
27. In the original investigation actual adjustments were made for cost of credit (xxxx days at xxxx percent), customs costs, terminal handling, container handling, bill of lading costs, bar markings and transport to the port which equated to between xxxx and xxxx percent of the FOB value per tonne.
28. The assessment team has checked Pacific Steel's information on adjustments with that provided in the application for the original investigation and can confirm the figures provided are the same. It is noted, however, that the Ministry applied in some instances, for initiation purposes, estimations provided to Pacific Steel by {deleted due to confidentiality} which differ slightly from the figures provided by Pacific Steel. An example is terminal handling and port charges where the Ministry used THBxxxx per container rather than THBxxxx submitted by Pacific Steel. In addition the assessment team has noted that the equivalent THB of its estimates in NZD, for example, equipment hire cost (from 2003) has been updated by the inflation rate rather than applying an updated exchange rate to its estimated NZD cost then applying the inflation rate.
29. The assessment team's recalculation of ex-factory export prices uses an inflation rate figure sourced from a publication of the International Monetary Fund and an exchange rate average for 2007 sourced from Oanda of NZD1:THB23.9213. Total adjustments equate to between THBxxxx to THBxxxx which is xxxx to xxxx percent of the FOB value per tonne. The team's calculation of ex-factory export prices per tonne is less than those provided by Pacific Steel due mainly to removal of the unnecessary volume conversion factor.
30. When considering the evidence provided by Pacific Steel to establish an ex-factory export price and information used in the original investigation the assessment team is satisfied that Pacific Steel has provided reasonable information for the estimation of base export prices and the costs that would be incurred in preparing the reinforcing steel bar and coil for shipment to New Zealand which would be additional to those costs incurred on domestic sales in Thailand to arrive at ex-factory export prices.
31. The ex-factory export prices recalculated by the assessment team are THBxxxx to THBxxxx per tonne, with an average for Thai exports to all sources of THBxxxx.
Normal Value
32. Pacific Steel has estimated a normal value based on financial performance information of {deleted due to confidentiality}10. The base normal value has been adjusted for the differences that affect price comparability with export prices.
33. An online search of {deleted due to confidentiality} reveals that it is a Thailand based company which produces and distributes steel bars {deleted due to confidentiality} in Thailand. {deleted due to confidentiality} products include round steel bars and deformed steel bars and it has a full production capacity of xxxx tons per annum11. The published financial information of {deleted due to confidentiality} has been supplied to {deleted due to confidentiality}.
34. The assessment team could not find the exact web reference to {deleted due to confidentiality} prices referred to by Pacific Steel but it has found a publication {deleted due to confidentiality}12 which includes {deleted due to confidentiality} operating performance based on company reports and {deleted due to confidentiality} from first quarter 2007 to the fourth quarter of 2008. This data includes a quarterly domestic sale price per tonne. The assessment team has checked the sale price figures disclosed in this document against those provided by Pacific Steel and they are the same.
35. Pacific Steel considers that {deleted due to confidentiality} sale price refers to the price of deformed bars of 16mm as a graph on {deleted due to confidentiality} publication shows the price of deformed bars in Bangkok at a similar level as the average price it has calculated.
36. Pacific Steel has calculated an average price per tonne based on {deleted due to confidentiality} sale price of the last three quarters of 2007 to establish a normal value. Pacific Steel has not commented on why it has chosen the later three values of 2007. It is observed that the published {deleted due to confidentiality} sale price in the first quarter of 2007 is less than prices in the second, third and fourth quarter of 2007 and may reflect a 2006 price when the prices were much lower, therefore it is reasonable to choose the later three quarters of 2007 as an estimation of an average price that is more closely representative of future values.
37. Pacific Steel is of the opinion that {deleted due to confidentiality} price is most probably at the ex-works level and therefore it has estimated adjustments for cost of credit (xxxx days at xxxx percent), volume discount of xxxx percent and short length premium of THBxxxx per tonne. Pacific Steel provided evidence regarding these adjustments in the original investigation and it maintains that the same terms of trade would continue to apply. Pacific Steel believes that {deleted due to confidentiality} customers would be large distributors therefore the sale price should be adjusted upwards for the difference between the volume of domestic sales compared to the volume of export sales as it is most likely that the volume of export sales (if made to New Zealand) would be less than domestic sales. In relation to the short length premium Pacific Steel has updated the adjustment value by the inflation rate. In the original investigation a negative adjustment was made for a cost of credit (xxxx days at xxxx percent), and positive adjustments were made for volume discount and short length premium in instances only where short lengths of six metres were exported. Pacific Steel has taken the same approach in its recent calculations.
38. The assessment team has considered the adjustments made by Pacific Steel and agree that it is reasonable to adjust for a cost of credit, volume discount and short length premium given that evidence in support of these adjustments was accepted in the original investigation and actual adjustments were made for these costs.
39. The normal value is calculated as THBxxxx per tonne.
Comparison of Export Price and Normal Value (Dumping Margin)
40. The following table illustrates the estimated export prices and normal value and the resulting dumping margins.
| Importing country |
Ex-Factory Export Price |
Ex-Factory Normal Value |
Dumping Margin |
DM as % of EP |
| World |
xxxx |
xxxx |
xxxx |
37% |
| USA |
xxxx |
xxxx |
xxxx |
39% |
| UAE |
xxxx |
xxxx |
xxxx |
37% |
| Laos |
xxxx |
xxxx |
xxxx |
23% |
| Cambodia |
xxxx |
xxxx |
xxxx |
59% |
| Mauritius |
xxxx |
xxxx |
xxxx |
23% |
| Myanmar |
xxxx |
xxxx |
xxxx |
9% |
| F. Polynesia |
xxxx |
xxxx |
xxxx |
18% |
41. Pacific Steel has commented that due to the difficulties in providing the information on export price and normal value there is one aspect that may have a considerable bearing on the prices i.e. whether they relate to reinforcing steel bar and coil of the micro-alloyed type or the quench and tempered type. The assessment team understands that micro-alloyed product is more expensive than the quench and tempered type. The assessment team notes, however, that dumping margins are significant and that {deleted due to confidentiality} website does not indicate that its product is micro-alloyed, meaning that estimated normal values should be conservative. Pacific Steel has reserved its right to make further representations on this matter.
Conclusion on Dumping
42. Pacific Steel has provided evidence of estimated export prices and a normal value based on online references together with evidence used in the original dumping investigation, which has been updated by the Thai inflation rate. The information has been checked and is considered to be reasonable.
43. The information indicates that reinforcing steel bar and coil from Thailand has been exported at dumped prices to countries other than New Zealand and therefore it is likely that should exportation to New Zealand of reinforcing steel bar and coil of Thai origin recommence there would be a continuation or recurrence of dumping. The information provided by Pacific Steel constitutes positive evidence of a continuation or recurrence of dumping should the anti-dumping duties be removed that is sufficient to justify the initiation of a review.
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