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Anti-dumping and Countervailing Program
Pipe Fittings - Preliminary Determination
OTTAWA, April 2, 2003
4258-119
AD1291
STATEMENT OF REASONS
Concerning the preliminary determination of dumping pursuant to subsection 38(1) of the Special Import Measures Act regarding
CERTAIN CARBON STEEL PIPE NIPPLES, THREADED COUPLINGS AND ADAPTOR FITTINGS, ORIGINATING IN OR EXPORTED FROM THE PEOPLE'S REPUBLIC OF CHINA
DECISION
Pursuant to subsection 38(1) of the Special Import Measures Act, the Commissioner of Customs and Revenue has today made a preliminary determination of dumping regarding carbon steel pipe nipples, threaded couplings and adaptor fittings, in nominal diameters up to and including 6 inches or the metric equivalents, originating in or exported from the People's Republic of China.
This Statement of Reasons is also available in French. Please refer to the "Information" section.
Cet énoncé des motifs est également disponible en français. Veuillez consulter la section « Information ».
TABLE OF CONTENTS
Interested Parties
Complainant
Exporters
Importers
Product
Product Definition
Classification of Imports
The Investigation
Results Of The Investigation
Section 20 Inquiry
Government Response
Producer Responses
Exporter Responses
Assessment
Estimated Normal Values and Export Prices
Estimated Normal Values
Estimated Export Prices
Estimated Margins of Dumping by Product Class
Summary of Results
Provisional Duty To Be Imposed
Future Action
The CCRA
The Canadian International Trade Tribunal
Retroactive duty on massive importations
Undertakings
Appendix 1
Product Information - Appendix 2
Summary
On December 18, 2002, the Commissioner of Customs and Revenue (Commissioner) initiated an investigation respecting the alleged injurious dumping of certain carbon steel pipe nipples, threaded couplings and adaptor fittings (certain carbon steel pipe fittings) originating in or exported from the People's Republic of China (China). The investigation was initiated in response to a complaint filed by Canvil, a Division of Mueller Canada Limited of Simcoe, Ontario.
On receiving notice of the investigation, the Canadian International Trade Tribunal (Tribunal) started its preliminary injury inquiry. On February 17, 2003, the Tribunal made a preliminary determination that the evidence disclosed a reasonable indication that the alleged dumping of the subject goods has caused injury to the domestic industry.
As a result of the Canada Customs and Revenue Agency's (CCRA) preliminary investigation, the Commissioner is satisfied that the subject goods have been dumped, that the margins of dumping are not insignificant and that the volume of dumped goods is not negligible. Accordingly, the Commissioner has made a preliminary determination of dumping in accordance with subsection 38(1) of the Special Import Measures Act (SIMA).
PERIOD OF INVESTIGATION
The period of investigation (POI) used to determine dumping and to determine if the volume of dumped goods, actual or potential, was negligible is January 1, 2002 to September 30, 2002.
Interested Parties
Complainant
Canvil is one of four Canadian producers of the subject goods. The other producers are: CapProducts of Canada, located in Vanastra, Ontario; TCG Pipe Services Ltd. of Edmonton, Alberta; and Willett Manufacturing Ltd. of Estevan, Saskatchewan. Officials of CapProducts have provided the CCRA with a letter of support for this complaint.
Exporters
At the time of the initiation, the CCRA identified twelve possible exporters and eight vendors of the subject goods. During the preliminary stage of the investigation, the CCRA confirmed that six exporters and two vendors were involved in exports of subject goods during the POI.
Importers
At the time of the initiation, the CCRA identified fourteen possible importers of subject goods. During the preliminary stage of the investigation, the CCRA confirmed that there were thirteen importers of subject goods during the POI.
Background
Following a number of discussions and meetings with the CCRA, Canvil submitted a formal complaint on October 11, 2002 alleging that the dumped imports of certain carbon steel pipe fittings originating in or exported from China were causing injury to domestic producers. The complainant was notified on October 31, 2002, that their complaint was not properly documented.
On November 6, 2002, Canvil filed a revised complaint with the CCRA. The CCRA informed Canvil on November 27, 2002, that its revised complaint was properly documented and notified the Government of China (GOC) that a complaint had been received regarding the alleged dumping of certain carbon steel pipe fittings.
On December 18, 2002, the Commissioner initiated a dumping investigation and notified the Tribunal of that decision. The Tribunal subsequently initiated a preliminary injury inquiry into whether the evidence disclosed a reasonable indication of injury, retardation or threat of injury caused by the dumping of the goods. On February 17, 2003, the Tribunal made a preliminary determination that the evidence disclosed a reasonable indication that the alleged dumping of each of the three classes of the subject goods has caused injury.
Product
Product Definition
For the purpose of this investigation, the subject goods are defined as:
"carbon steel pipe nipples, threaded couplings and adaptor fittings, in nominal diameters up to and including 6 inches or the metric equivalents, originating in or exported from the People's Republic of China."
The CCRA initiated this investigation on the basis that there were three classes of goods based on variances in their ultimate use, their product characteristics, functions and other factors. The three classes of goods are pipe nipples, threaded couplings and adaptor fittings. As noted above, the Tribunal made its preliminary determination of injury in respect of these three classes. Consequently, the CCRA continued the preliminary investigation on the basis of these three classes of goods. However, the results of the dumping investigation are also provided on the basis of one class of goods should the Tribunal wish to reconsider this issue during the injury inquiry. For additional product information and uses, please refer to Appendix 2 attached at the end this document.
Classification of Imports
The goods in question are usually classified under the following Harmonized System classification numbers:
7307.99.99.11
7307.99.99.19
Canadian Industry
There have been no changes in the structure of the Canadian industry since the investigation was initiated. Canvil is one of four Canadian producers of the subject goods. The other producers are: CapProducts of Canada, located in Vanastra, Ontario; TCG Pipe Services Ltd. of Edmonton, Alberta; and Willett Manufacturing Ltd. of Estevan, Saskatchewan.
Canadian Imports
At the time of the initiation of the investigation, the CCRA requested all importers to provide the total quantity (pieces) and value of the subject goods imported from China during the POI. After examining information received from importers and import documentation, the CCRA has adjusted the estimated volume of imports of the carbon steel pipe fittings. The only other imports of carbon steel pipe fittings originated in the United States of America (United States) and the Republic of Korea (Korea), which are both non-subject countries.
In order to estimate the Canadian imports, the CCRA utilized its internal information system, Facility for Information Retrieval Management (FIRM), and reviewed selected customs entries for the subject goods to determine the value and volume of imports. For the POI, imports of Chinese origin accounted for 92 per cent of the total volume of goods of the same description released into Canada from all countries.
The Investigation
The dumping investigation involved all of the subject goods released into Canada from customs control during the POI.
Unless the conditions of section 20 of SIMA are applicable, a normal value is generally based on the domestic selling prices of the goods in the country of export or the total cost of the goods (cost of production, administrative, selling and all other costs) plus an amount for profits.
Since China is a prescribed country for purposes of paragraph 20(1)(a) of SIMA, the Commissioner must first form an opinion whether domestic prices of the subject goods are substantially determined by the government and whether there is sufficient reason to believe that they are not substantially the same as they would be if they were determined in a competitive market.
If the Commissioner forms the opinion that the above-noted conditions exist, the normal value of the goods is generally determined using the domestic selling price or the full costs of like goods produced in a surrogate country which is operating under competitive conditions. Another method to determine normal values is based on the resale price in Canada of like goods produced in a surrogate country and imported from that country.
The export price of subject goods shipped to Canada is normally the lesser of the exporter's ex-factory selling price or the importer's purchase price adjusted for freight charges and all other costs resulting from the exportation of the goods. When the export price is less than the normal value, the difference is the margin of dumping.
At the time of initiation of this investigation, the CCRA had information that the sector producing the subject goods may have been operating under conditions described in paragraph 20(1)(a) of SIMA. For example, the key input carbon steel pipe, used in the manufacture of the subject goods, was subject to import and export restrictions1. The CCRA also had evidence of government2 ownership in the pipe fittings sector in China. Further evidence included the treatment of that sector in China by other anti-dumping authorities3.
On the basis of that information, the CCRA was satisfied that a paragraph 20(1)(a) inquiry would be warranted in this investigation. At the time of initiation of the investigation, the GOC and Chinese producers and exporters were requested to provide information in order to assess whether the carbon steel pipe fittings industrial sector in China is operating under conditions described in paragraph 20(1)(a) of SIMA.
On January 23, 2003, the GOC contacted the CCRA and expressed their concerns regarding the CCRA's investigation of certain carbon steel pipe fittings. In a letter, dated February 12, 2003, the CCRA explained that Chinese domestic prices and costs would be used to determine normal values in a dumping investigation if the producers in that sector could clearly show that they were not operating under conditions described in paragraph 20(1)(a) of SIMA. Since the CCRA makes this assessment based on the sector as a whole, information is also being sought from producers of the goods in China that have not exported the goods to Canada during the POI.
The GOC provided a response to the CCRA's Request for Information (RFI), on January 24, 2003, and indicated that they were unable to determine how many companies were involved in the carbon steel pipe fittings sector. Through the China Chamber of Commerce of Metals, Minerals & Chemical Importers & Exporters (the Chamber), they were able to identify two companies that manufactured the subject goods, Beijing Beier Plumbing Manufacturing Ltd. (BBPM) and Jinan Meide Casting Co. Ltd. (JMC). In their response, the GOC indicated that BBPM was involved only in export sales while JMC was involved in both export and domestic sales.
In order to assist the Chamber, the CCRA on February 14, 2003, provided them a list of ten Chinese companies that may be producers in the carbon steel pipe fitting sector, that had been identified on the China Business Guide web site, under the key word "steel pipe fittings". In addition, it was noted that the two companies identified in the GOC's response were listed in the China Business Guide under the key word "malleable iron pipe fittings" along with another forty-three companies.
To date, only one Chinese producer, BBPM, has submitted a response to the CCRA's Producer RFI. However, the BBPM response was of limited use as the company only produces the subject goods for export and therefore has no domestic sales information4.
At the initiation of the investigation, the CCRA had also requested information from companies identified as possible exporters, vendors and importers of the subject goods. Only one company, BBPM, submitted a response to the CCRA's Exporter RFI. As noted, BBPM only produces the subject goods for the export market and therefore has no domestic sales information. In addition, the BBPM response indicated that they use the services of a state owned trading company, China East Resources Import and Export Company (China East) to carry out their export sales5. However, a complete response to the Exporter RFI was not received from China East and therefore, for purposes of the preliminary determination, the CCRA does not have complete information concerning the export transactions to Canada that involve both BBPM and China East.
The four remaining confirmed exporters and two vendors did not provide responses to the CCRA's Exporter RFI. In addition, it was determined that one vendor was an exporter of the subject goods. Also, the CCRA identified a new exporter of the subject goods, but they did not ship the subject goods during the POI.
Information was also requested at initiation from producers of carbon steel pipe fittings in Mexico and Korea in the event that the Chinese carbon steel pipe fittings industry was considered to be operating under conditions described in paragraph 20(1)(a) of SIMA. None of the producers contacted in Korea or Mexico provided information to the CCRA.
Complete responses were received from six importers of the subject goods. One company identified as a possible importer at initiation was determined not to have imported the subject goods during the POI. It was also determined that two other importers identified at the initiation of the investigation were in fact freight forwarders of the subject goods. In addition, two new importers of the subject goods were identified during this stage of the investigation.
Results Of The Investigation
Section 20 Inquiry
The CCRA's assessment of the conditions described in paragraph 20(1)(a) of SIMA examined whether the GOC substantially determined the price of the like goods in the domestic market either in law or in practice, directly or indirectly. In making this assessment, the CCRA relies on information provided by the GOC and Chinese producers and exporters as well as any other publicly available information.
Government Response
The GOC provided a substantive response to the Government RFI. Based on their response, there appears to be no domestic law which imposes direct price control on the subject goods.
However, the CCRA's review of legislative documents in the GOC's response, in conjunction with other publicly available information, indicates that there is a potential for the GOC to influence the import and export operations of enterprises in China. For example, the ability of enterprises to engage in import and export business6 appears subject to various requirements and government approvals. Further investigation will be required to ascertain whether these measures have an effect on the domestic price of the goods under investigation.
In addition, the CCRA requires additional information and clarification to ascertain whether the GOC might be substantially determining the domestic price of the goods under investigation on an indirect basis through its possible control of State owned enterprises (SOEs) and through other regulatory measures relating to the supply of inputs.
The GOC has been provided with a list of supplemental questions regarding the CCRA's ongoing assessment of the conditions described in paragraph 20(1)(a) of SIMA as they relate to the carbon steel pipe fittings sector.
Producer Responses
The majority of carbon steel pipe fittings producers in China did not participate in the GOC's effort to collect information and did not respond to the CCRA's Producers RFI, consequently, the CCRA was unable to fully determine the structure of the carbon steel pipe fittings sector in China and to perform a proper assessment of its size and configuration. The only producer to cooperate and respond to the CCRA's Producer RFI indicated that they were not involved in the domestic market. Information on the domestic market was deemed necessary in order to determine the applicability of the various laws and regulations to the carbon steel pipe fittings producers, their impact on the carbon steel pipe fittings sector and to assess the level of state ownership and/or control over the industry. Without this information, the CCRA was unable to analyze the extent of the GOC's control of domestic pricing in the carbon steel pipe fittings sector in China.
Exporter Responses
As noted, only one company submitted a response to the CCRA's Exporter RFI. However, BBPM does not have the right to export the subject goods and China East, the trading company, did not provide a complete response. The CCRA considers that China East is integral to the export of the subject goods to Canada. Consequently, without a complete response from China East, the CCRA is unable to confirm the details of the export transactions or determine the exporter's selling price of the subject goods. Additional information has been requested from both BBPM and China East in order to assist the CCRA in the investigation.
As a general guideline, in the CCRA's administration of SIMA, the exporter is considered to be the person or firm who is a principal in the transaction, located in the country of export at the point of direct shipment to Canada who gave up responsibility for the goods by knowingly placing them in the hands of a carrier, courier, forwarding company, their own truck or conveyance, etc. for delivery to Canada.
Assessment
Based on information currently available to the Commissioner, there is no evidence that the GOC directly determines the domestic prices of carbon steel pipe fittings, either in law or practice. However, as a result of the information not being made available, the CCRA was unable to assess the possibility that the GOC may be substantially determining domestic prices on an indirect basis. In particular, more information is required concerning the provision of inputs by SOEs to the producers of carbon steel pipe fittings and the role of the GOC in the operations of the SOEs.
Due to the lack of participation by the producers in China, the CCRA could not determine the market share of state-owned carbon steel pipe fitting producers in the domestic industry and could not assess if the GOC did in fact interfere with their decisions. The CCRA also could not assess any pricing differences between the raw materials supplied by SOEs and the raw materials supplied by non-SOEs. Cooperation from the Chinese domestic producers is crucial in assisting the CCRA in its assessment of the Chinese carbon steel pipe fitting sector.
As a result, the Commissioner does not have sufficient information on which to form an opinion referred to in paragraph 20(1)(a) of SIMA. The CCRA will continue its section 20 inquiry for purposes of the final determination.
Estimated Normal Values and Export Prices
Estimated Normal Values
As noted in the previous section, the Commissioner cannot yet form an opinion under paragraph 20(1)(a) of SIMA, namely due to the lack of cooperation from the carbon steel pipe fitting producers in China. In addition, the lack of cooperation from the exporters of the subject goods made it difficult to determine and estimate dumping based on domestic prices and costs.
Therefore, given the lack of cooperation from the exporters for purposes of the preliminary decision, the normal values for the subject goods were estimated based on the facts available to the CCRA. While the CCRA had contacted carbon steel pipe fitting producers in Korea and Mexico to request selling and costing information, none provided a response to the CCRA's RFI. Accordingly, for purposes of the preliminary determination, the full costs of specific carbon steel pipe fittings products manufactured in China were estimated by using the complainant's actual costs of production during the period of investigation, with various adjustments as listed below.
The CCRA started with the complainant's full costs of production for forty-eight benchmark products, covering the three product classes. These costs of production were then adjusted by the CCRA based on assumptions relating to the production costs in China. In addition, factory overhead, selling, general and administrative expenses were based on publicly available information that was obtained from a sample of 1,914 public limited companies in India, as reported in the June 2001 Reserve Bank of India Bulletin. A reasonable amount for profits, which was based on the same sample was also included in the calculation.
In addition, for purposes of the preliminary determination, the estimated normal values of the non-benchmark goods were based on the estimated export price of the non-benchmark goods plus an advance representing the estimated weighted average margin of dumping found for the benchmark goods, expressed as a percentage of the estimated export price, by product class. Accordingly, for the non-benchmark pipe nipples, the advance was 81 per cent, for the non-benchmark threaded couplings, the advance was 45 per cent and for the non-benchmark adaptor fittings, the advance was 10 per cent. These advances represent the estimated weighted average margins of dumping for each product class found in this preliminary investigation for the forty-eight benchmark products, expressed as a percentage of the estimated export price.
Chinese origin goods were also shipped indirectly to Canada through the United States. In situations where goods are shipped indirectly to Canada, the CCRA is required to estimate the normal value of the goods, in the country of origin and in the country of export. Where the normal value in the country of origin is higher than the normal value determined in the country of export then both normal value and export price will be determined as if the goods were shipped directly from the country of origin. Since the CCRA received no cooperation from the United States exporter of the subject goods, the estimated normal values were based on the estimated export price plus an advance, by product class. The advance represents the estimated weighted average margin of dumping for each product class, expressed as a percentage of the estimated export price.
Estimated Export Prices
For estimating export prices of subject goods produced by BBPM, the CCRA could not determine the exporter's selling price of the subject goods without a complete submission from China East7. Therefore, for purposes of the preliminary determination, the CCRA estimated the export price on the basis of facts available by using the importer's purchase price adjusted for freight charges and all other costs resulting from the exportation of the goods to Canada.
For all other exporters who did not provide complete submissions to the CCRA, export prices were estimated based on the facts available by using the purchase price paid by importers adjusted for freight charges and all other costs resulting from the exportation of the goods to Canada.
Estimated Margins of Dumping by Product Class
For purposes of the preliminary determination of dumping, the estimated margin of dumping is the difference by which the estimated normal value of a good exceeds the estimated export price. The CCRA's investigation of imports from China between January 1, 2002, and September 30, 2002, revealed the following by product class.
a) Pipe Nipples
All subject carbon steel pipe nipples imported into Canada during the POI were reviewed. Of these goods, 100 per cent were found to be dumped. The estimated margins of dumping ranged from 2 to 333 per cent. The estimated weighted average margin of dumping was 81 per cent.
b) Threaded Couplings
All subject carbon steel threaded couplings imported into Canada during the POI were reviewed. Of these goods, 100 per cent were found to be dumped. The estimated margins of dumping ranged from 7 to 119 per cent. The estimated weighted average margin of dumping was 45 per cent.
c) Adaptor Fittings
All subject carbon steel adaptor fittings imported into Canada during the POI were reviewed. Of these goods, 67.4 per cent were found to be dumped. The estimated margins of dumping ranged from 1 to 101 per cent. The estimated weighted average margin of dumping was 10 per cent.
d) Total All Products
Of all subject carbon steel pipe nipples, threaded couplings and adaptor fittings imported into Canada during the POI, 99.6 per cent of units were found to be dumped. The estimated margins of dumping ranged from 1 to 333 per cent. The overall estimated weighted average margin of dumping was 79 per cent.
Summary of Results
Before making a preliminary determination of dumping, the Commissioner must be satisfied that the actual or potential volume of dumped goods is not negligible and that the estimated margins of dumping are not insignificant. If the volume of dumped goods from a country is less than 3 per cent of the total volume of goods of the same description released into Canada from all countries during the POI, the volume is considered to be negligible.
A detailed review of imports for certain carbon steel pipe fittings for the POI was carried out by the CCRA. This review revealed the following:
a) the total volume of all imports of dumped carbon steel pipe nipples originating in China during the POI represented 98.6 per cent of the total volume of goods of the same description released into Canada from all countries.
b) the total volume of all dumped carbon steel threaded couplings originating in China during the POI represented 5.7 per cent of the total volume of goods of the same description released into Canada from all countries.
c) the total volume of all dumped carbon steel adaptor fittings originating in China during the POI represented 44.7 per cent of the total volume of goods of the same description released into Canada from all countries.
d) the total volume of all dumped carbon steel pipe nipples, threaded couplings and adaptor fittings originating in China during the POI represented 91.7 per cent of the total volume of goods of the same description released into Canada from all countries.
Subsection 2(1) of SIMA stipulates that the margin of dumping is considered to be insignificant if it is less than 2 per cent of the export price of the goods. As shown in Appendix 1, the estimated margins of dumping are not negligible since they exceed 2 per cent.
Decision
Based on the preliminary results of the investigation, the Commissioner is satisfied that the subject goods originating in or exported from China have been dumped, that the volume of the dumped goods is not negligible, and that the estimated margin of dumping is not insignificant. Accordingly, on March 18, 2003, the Commissioner has made a preliminary determination of dumping pursuant to subsection 38(1) of SIMA.
Provisional Duty To Be Imposed
In order to prevent further injury from dumped imports, provisional duty will be applied to all subject goods imported into Canada on or after March 18, 2003, as per subsection 8(1) of SIMA. The amounts of provisional duty are based on the estimated margins of dumping found during the POI. The provisional duty to be collected is provided in Appendix 1.
Provisional duty is payable by the importer and is applied on all subject imports until the day the Tribunal makes its final ruling on injury. However, if the investigation is terminated by the CCRA or there is an undertaking arrangement, provisional duty will no longer be applied to the imported goods.
Importers are required to pay provisional duty in cash or by certified cheque. Alternatively, they may post security equal to the amount payable. Importers should contact their regional Customs Office if they require further information on the payment of provisional duty or the posting of security. Should importers of these goods not complete the SIMA code as required or not describe the goods as required on Customs documents, an Administrative Monetary Penalty (AMP) may be issued. Goods imported into Canada are subject to the provisions of the Customs Act. As such, failure to pay duties within the prescribed time will result in the application of the interest provisions of that Act.
Future Action
The CCRA
The CCRA will continue its investigation of the dumping and a final decision will be made by June 16, 2003. If the margin of dumping is insignificant, proceedings will be terminated and any provisional duty paid or security posted will be returned to the importers, as appropriate.
The Canadian International Trade Tribunal
The Tribunal will now begin its full injury inquiry and conduct a public hearing into the question of injury. The Tribunal is required to issue its final decision not later than July 16, 2003.
If the Tribunal finds that the dumping has not caused injury or is not threatening to cause injury, then proceedings will be terminated and all provisional duties collected will be refunded. If a decision of injury is made, anti-dumping duty will be imposed on imports of the subject goods.
Retroactive duty on massive importations
Under certain circumstances, anti-dumping duty can be imposed retroactively on subject goods imported into Canada. When the Tribunal conducts its inquiry on material injury to the Canadian industry, it may consider if dumped goods that were imported close to or after the initiation of the investigation constitute massive importations over a relatively short period of time and have caused injury to the Canadian industry. Should the Tribunal issue a finding that there were recent massive importations of dumped goods that caused injury, imports of subject goods released by the CCRA in the 90 days preceding the day of the preliminary determination could be subject to anti-dumping duty.
Undertakings
After a preliminary determination of dumping, the Commissioner may accept undertakings that eliminate the margin of dumping of the goods, or that eliminate the injury caused by the dumping. Acceptable undertakings must account for all or substantially all of the exports to Canada of the dumped goods. If undertakings are accepted, the imposition of provisional duty will be suspended.
In view of the time needed for consideration of undertakings, written undertaking proposals should be made as early as possible, and no later than 60 days after the preliminary determination of dumping.
The legislation allows all interested parties to make representations concerning any undertaking proposals. The CCRA will maintain a list of interested parties and will notify them should an undertaking proposal be received. Persons wishing to be notified must provide their name, address, telephone number, fax, or email address, to one of the officers listed below. Interested parties may also consult the Internet website noted below for information on undertakings offered in this investigation. A notice will be posted on the website when an undertaking proposal is received. Interested parties have nine days from the date the undertaking offer is received to make representations.
Publication
Notice of this preliminary determination is being published in the Canada Gazette pursuant to paragraph 38(3)(a) of SIMA.
Information
This Statement of Reasons has been provided to persons directly interested in these proceedings. It is also posted at the Directorate's Internet website at the address below. For further information, please contact Richard Pragnell or Edith Trottier-Lawson as follows:
Canada Customs and Revenue Agency
Anti-dumping and Countervailing Directorate
191 Laurier Avenue West, 16th Floor
Ottawa, Ontario
Canada
K1A 0L5
Richard Pragnell: (613) 954-0032
Edith Trottier-Lawson: (613) 954-7182
FAX: (613) 941-2612
Richard.Pragnell@ccra-adrc.gc.ca
Edith.Trottier-Lawson@ccra-adrc.gc.ca
Suzanne Parent
Director General
Anti-dumping and Countervailing Directorate
Appendix 1
SUMMARY OF PRELIMINARY DETERMINATION ESTIMATED MARGINS OF DUMPING FOR CERTAIN CARBON STEEL PIPE FITTINGS
(January 1, 2002, to September 30, 2002)
Carbon Steel Pipe Nipples
|
Exporters |
% of Goods Dumped |
Range of Margins of Dumping (% of Export Price) |
Weighted Average Margin of Dumping (% of Export Price) |
Provisional Duty to be Imposed1 (% of Export Price) |
|---|---|---|---|---|
|
All exporters |
100% |
2% to 333% |
81% |
238% |
|
Total for China |
100% |
81% |
Carbon Steel Threaded Couplings
|
Exporters |
% of Goods Dumped |
Range of Margins of Dumping (% of Export Price) |
Weighted Average Margin of Dumping (% of Export Price) |
Provisional Duty to be Imposed1 (% of Export Price) |
|---|---|---|---|---|
|
All exporters |
100% |
7% to 119% |
45% |
119% |
|
Total for China |
100% |
45% |
Carbon Steel Adaptor Fittings
|
Exporters |
% of Goods Dumped |
Range of Margins of Dumping (% of Export Price) |
Weighted Average Margin of Dumping (% of Export Price) |
Provisional Duty to be Imposed1 (% of Export Price) |
|---|---|---|---|---|
|
All exporters |
67% |
1 to 101% |
10% |
101% |
|
Total for China |
67% |
10% |
Product Information - Appendix 2
The subject goods include: carbon steel pipe nipples manufactured to conform with ASTM8 specification A733, including pipe nipples greater than 12 inches in length referred to as "ready cut pipe"; carbon steel threaded couplings manufactured to conform with ASTM specification A865, carbon steel electrical conduit nipples and threaded couplings manufactured to conform with UL9 6 or CSA10 C22.2 No. 45-M1981 specifications and carbon steel adaptor fittings consisting of combination nipples, hose menders, male adapters and insert couplings. The subject goods are available in a variety of finishes.
The subject goods are normally produced to ASTM, UL or CSA specifications, or specifications in other recognized designation systems, or to a proprietary specification or standard.
Pipe nipples are manufactured in accordance with ASTM specification A733 from carbon steel pipe complying to: ASTM A53 type F (welded), grade A; ASTM A53 type E (electric resistance welded), grades A and B; ASTM A53 Type S (seamless), grades A and B; ASTM A106 (seamless), grades A and B or ASME11 SA53 type F (welded), grade A; ASME SA53 type E (electric resistance welded), grades A and B; ASME SA53 type S (seamless), grades A and B and ASME SA106 (seamless), grades A and B. In addition, they are manufactured in various wall thicknesses of carbon steel pipe, namely schedule 40, schedule 80, schedule 160 or standard, XS (extra strong) and XXS (double extra strong), XH (extra heavy) and XXH (double extra heavy). For further clarity, carbon steel seamless pipe nipples manufactured for high pressure applications are not covered by the definition of subject goods.
The lengths of the pipe nipples begin at "close" through to 72 inches long. A "close" pipe nipple is the shortest length and is threaded from each end with the thread meeting in the middle. Pipe nipples up to 24 inches in length typically increase in ½ inch to 1 inch increments depending on the nominal diameter. In addition, pipe nipples greater than 12 inches in length are sometimes referred to as "ready cut pipe" and typically increase in 6 inch to 12 inch increments. However, custom lengths are available. The configuration on either end of a pipe nipple could be taper pipe threaded, square cut, reamed and chamfered, grooved or any combination of the aforementioned. Threads are right hand on each end unless otherwise specified. Left hand threads or plain ends or combinations are available. All threads conform to ANSI12/ASME standard B1.20.1. The pipe nipples are available in a variety of finishes, typically black or galvanized coatings.
Threaded couplings are manufactured in accordance with ASTM specification A865. They can be produced from solid carbon steel bar, welded carbon steel tube or seamless carbon steel tube. The nominal diameters for the couplings range from 1/8 inch to 6 inches and they can be manufactured in full and half coupling variations. They are internally threaded at both ends to ANSI/ASME standard B1.20.1 and can be either straight pipe threaded or taper pipe threaded. The couplings are available in a variety of finishes, typically black, rust preventative oil, phosphate or galvanized coating.
Electrical conduit nipples and couplings are manufactured to UL 6 or CSA C22.2 No. 45-M1981 specifications. They are normally produced from welded carbon steel tube. Nominal diameters range from ½ inch to 6 inches for both the conduit nipples and couplings. For the electrical conduit nipples the nominal lengths begin at "close" through to 12 inches long, typically increasing in ½ inch increments and each end has a tapered pipe thread conforming to ANSI/ASME standard B1.20.1. The internal threads of the electrical conduit couplings are straight pipe threads that conform to ANSI/ASME standard B1.20.1. The electrical conduit nipples and couplings are finished with a protective zinc or alternative corrosion-resistant coating.
Adaptor fittings consist of combination nipples, hose menders, male adaptors and insert couplings. Combination nipples and hose menders are manufactured from welded or seamless carbon steel tube or pipe in nominal diameters from ½ inch to 6 inches. Combination nipples have a tapered pipe thread on one end, which conforms to ANSI/ASME standard B1.20.1, the other end has hose serrations. Hose menders have hose serrations on both ends. These fittings are available in a variety of finishes, typically black or galvanized coatings.
Male adaptors and insert couplings are manufactured from either welded or seamless carbon steel tube or pipe in nominal diameters ranging from ½ inch to 4 inches. Male adaptors are also referred to as "king nipples" and have a tapered pipe thread on one end, which conforms to ANSI/ASME standard B1.20.1 while the other end has tube serrations. Insert couplings have tube serrations on both ends. These fittings are typically finished in a galvanized coating.
PRODUCT INFORMATION AND USES
The subject carbon steel pipe fittings are used in a number of mechanical and building applications. Pipe nipples are used in the plumbing and heating industries, and normally direct the flow of liquid or gaseous media. They are also used in various industrial applications in mining, refineries, resource mills and oil exploration. Electrical conduit nipples are used in the building industry to protect electric wiring between electrical devices.
Threaded coupling are used for joining lengths of threaded pipe (either welded or seamless) in a variety of domestic and industrial applications. The electrical conduit couplings are used for connecting together lengths of electrical conduit or to connect electrical fittings to the conduit.
Adaptor fittings consist of combination nipples, hose menders, male adaptors and insert couplings. Combination nipples are used to transition from standard pipe to rubber hose, while hose menders are used to join together lengths of rubber hose or repair damaged rubber hose. Both are normally used in industrial applications, agricultural irrigation and domestic well applications. Male adaptors are uses to transition from standard steel pipe to plastic tube and insert coupling are used to join together two pieces of plastic pipe or repair damaged pipe. These pipe fittings are normally used in industrial applications, agricultural irrigation and domestic wells.
PRODUCTION PROCESS
PIPE NIPPLES
Pipe nipples, including electrical conduit nipples, are manufactured from lengths of steel pipe. The pipe, after grading according to heat codes, is positioned on cut-off tables, where it is "saw" cut or "wheel" cut to specified lengths. Then, appropriate end configurations are machined at each end of the cut pipe. The most common operation is to thread both ends. The threading operation is achieved on one of three configurations of threading machines, depending on the diameter and length of the pipe.
The pipe nipple is then cleaned and a surface coating applied. This requires going through a "finishing line" process where the product is cleaned in an alkaline solution, then rinsed and coated with oil, or phosphated or electro-galvanized.
THREADED COUPLINGS
The threaded couplings, including electrical conduit couplings, are manufactured from tubular steel. The tube is first processed through the cut-off machine where it is both cut to length and sized internally by reaming. The next operation is called the chamfering process, where the coupling blank is machined to length and has a chamfer machined into the inside diameter. At this operation, the outside edge of the coupling is also deburred and stamped with country of origin and manufacturers emblem. The internal portion of the coupling is either threaded by a process referred to as straight tapping or taper tapping.
The threaded couplings are then cleaned and a surface coating applied, through the same process as for pipe nipples and adaptor fittings. From there, the product goes to packing where it is labelled, painted, bar-coded or stamped prior to being packaged.
ADAPTOR FITTINGS
Adaptor fittings are also made from lengths of steel pipe. After the grading process, the
pipe is cut utilizing the same processes as pipe nipples. In the next step, the pipe undergoes a cold forming operation by being pressed through a forming die under high pressure. The next operation is to have the ends machined. The normal configuration is to have the large end threaded and the small end serrated.
The fittings are then cleaned in solution and a surface coating of oil or phosphate is applied or the fitting may be electrogalvanized. From there, the product goes to the packing operation where it is labelled, painted, bar-coded or stamped.
Footnotes
1 World Trade Organization, Protocol on the Accession of the People's Republic of China, Article 5, Right to Trade, Annex 2B, Products Subject to Designated Trading.
2 For the purposes of this investigation, all levels of government are regarded as part of the government, i.e. central, provincial/state, regional, township, village, local, legislative, administrative or judicial, singular, collective, elected or appointed. It also includes any person, agency or institution acting for, on behalf of, or under the authority of any law passed by, the government of that country or that provincial, state or municipal or other local or regional government.
3 European Economic Union, Council Regulation (EC) No. 1784/2000, August 11, 2000. United States of America, Import Administration, International Trade Administration, Department of Commerce, Federal Register, A-570-881, November 25, 2002, Volume 67, Number 227. The CCRA recognizes that non-market criteria used by anti-dumping authorities may differ from country to country.
4 BBPM non-confidential response, Part C, C3, page 18.
5 BBPM non-confidential response, Part B, B1(a), page 7, "BBPM is not authorized to export and, therefore, exports through China East who has rights to export goods to Canada, including the subject goods".
6 Provisions for the Control of Enterprises' Power to Engage in Import and Export Business, No. 370.
7 BBPM has stated that China East has the right to export the subject goods, BBPM non-confidential response, Part B, B1(a) page 7. The CCRA considers them to be an integral party to the export transactions of the subject goods to Canada.
8 American Society for Testing and Materials.
10 Canadian Standards Association.
