MINISTRY
OF COMMERCE
NOTIFICATION
Subject : Anti-dumping investigation concerning
imports of Acrylic Fibre from
32/1/97-ADD : Having regard to the Customs Tariff Act 1975 as
amended in 1995 and the Customs Tariff (Identification, Assessment and
Collection of Anti-dumping Duty on Dumped Articles and for Determination of
Injury) Rules, 1995, thereof;
A. PROCEDURE
1. The procedure
described below has been followed with regard to the investigation:
i. The
Designated Authority (hereinafter also referred to as Authority), under the
above Rules, received a written application from Indian Acrylic Ltd., Pasupati Acrylon Ltd., JK
Synthetics Ltd. and Consolidated Fibres and Chemicals
Ltd (referred to Indian Acrylic, Pasupati, JK and
consolidated hereinafter) respectively on behalf of the domestic industry,
alleging dumping of acrylic fibre (hereinafter also
referred to as subject goods) originating in or exported from Japan, Portugal,
Spain and Italy.
ii. Preliminary scrutiny of the application filed by petitioner revealed certain deficiencies, which were subsequently rectified by the petitioner. The petition was therefore considered as properly documented;
iii. The Authority, on
the basis of sufficient evidence submitted by the petitioner decided to
initiate the investigations against imports of acrylic fibre
from
iv. The Authority issued
a public notice dated 7th January 1998 published in the Gazette of India,
Extraordinary, initiating anti-dumping investigations concerning imports of
Acrylic fibre classified under custom code 550330 of
Schedule 1 of the Customs Tariff Act, 1975 originating in or exported from
Japan, Portugal, Spain and Italy (hereinafter also referred to as the subject
country).
v. The Authority
forwarded a copy of the public notice to all the known exporters (whose details
were, made available by the petitioners) and industry associations and gave
them an opportunity to make their views known in writing in accordance with the
rule 6(2);
vi. The Authority forwarded a copy of the
public notice to all the known importers (whose details were made available by
petitioner) of Acrylic fibre in
vii. Request was made to the Central Board of
Excise and Customs (CBEC) to arrange details of imports of Acrylic fibre made in
viii. The Authority provided a copy of the
petition to the known exporters and the Embassy of the subject countries in
accordance with rules 6(3) supra. A copy of the petition was also provided to
other interested parties, wherever requested;
ix. The Authority sent a questionnaire to
elicit relevant information, to the following known exporters, in accordance
with the rule 6(4);
(a)
Komatsuya Corporation -
(b)
Fibras Sinteticas de Portugal -
(c)
Courtaulds Europeans Fibre -
(d)
Monte Fibre SPA
-
A number of
parties requested for extension of time, which was allowed by the Authority by
four weeks. The responses received after the extended time have not been considered for determining the preliminary findings.
The following
exporters responded:
I.
(a) Ashahi Chemicals Industries Ltd.
(b) Sumikin
Bussan Corpn.
(c) Nichimen Corporation
(d) Marubeni Corporation
(e) Mitsubishi
Rayon & Ltd.
(f) Toyobo Co Ltd.
(g) Kanematsu Corpn.
(h) Komatsuya
Corpn.
(i) Itochu
Corpn.
(j) Mitsui & Co.
(k) Mitsubishi Corpn.
(1) Kaneka Corporation
II.
(a) Montefibre
SPA
III.
a)
Montefibre Hispania SA
b)
Courtaulds Espana SA
IV.
a) Fisipe
x. The Embassy of the subject countries in
xi. A questionnaire was sent to the
following known importers of Acrylic fibre calling
for necessary information in accordance with rule 6(4);
Ř
Vardhman Spg & Gen Mills -
Ř
Nahar Spg Mills Ltd. -
Ř
Malwa Cotton Spg Mills Ltd.-
Ř
Rajasthan
Spg & Wvg Mills Ltd.-
New
Ř
Winsome
Textile Inds Ltd. -
Ř
Siddhartha
Super Spg Mills Ltd.-
Ř
Bhiwani Textile Mills - Haryana
Ř
Adhinath Textiles Ltd.-
Ř
Shruti Suyntetics Ltd.-
Ř
Arihant Spg Mills.
Ř
Banswara Syntex Ltd.
Ř
Atlantic
Spg & Wvg. Mills.
Ř
Arham Spg Mills,
Ř
Ashupati Textiles.
A number of
parties requested for extension of time, which also was allowed by the Authority
by four weeks. Response to the questionnaire was filed by the following;
• Association of Wool Mark Knitwear -
•
• Kohinoor
Woolen Mills _
• Oswal Woolen Mills -
• Arham Spinning Mills -
• Vardhman Spinning & General Mills Ltd., -
• Nahar Fibres Ltd. -
• Shruti Synthetic Ltd. -
• Adinath Textiles Ltd. -
• Rajasthan
Spinning & Weaving Mills Ltd. - Mumbai
• Malwa Cotton Spinning Mills -
xii. Additional information regarding injury
was sought from the petitioners, which was also furnished;
xiii. The Authority conducted on-the-spot
investigation at the premises of the co-operating exporters and petitioners to
the extent considered necessary;
xiv. The Authority kept available
non-confidential version of the evidence presented by various interested
parties in the form of a public file maintained by the Authority and kept open for
inspection by the interested parties;
xv. Cost investigations were also conducted
to work out optimum cost of production and cost to make and sell the subject
goods in India on the basis of Generally Accepted Accounting Principles (GAAP)
and the information furnished by the petitioners also as to ascertain if
anti-dumping duty lower than dumping margin would be sufficient to remove
injury to the domestic industry. It is submitted by the forum of acrylic fibre manufacturers that, JK Synthetics has since been
closed and therefore it is difficult to submit any information with respect to
the company and thus cost of production data could not be obtained from JK
Synthetics Ltd.
xvi. **** in this notification represents
information furnished by an interested party on confidential basis and so
considered by the Authority under the Rules;
xvii. Investigation was carried out for the
period starting from
B. PETITIONER VIEW
2. The petitioners have raised the following
major issues in their petition and subsequent submission.
(a) The combined capacity of Indian Industry
is 102000 MT PA. The combined capacity of the petitioner is around 75% of total
Indian production. The petitioners have submitted support expressed by the
forum of acrylic fibre manufacturers, signed by
conveyer. The petitioners have submitted that this forum represents other
Indian producer and therefore application made by petitioner may be treated as
made by or on behalf of the domestic industry and the petitioner may be treated
as the domestic industry.
(b) Dependence of the country on imports has
gone down with the installation of more and more plants, yet a lot of fibre is still being imported. Faced with heavy surplus
capacity, loss of domestic market and fall in exports, the exporters from
(c) The country today has sufficient
capacity to meet the current as well as the future demand. The capacity world
over is significantly higher than the global demand and a lot of producers are
faced with lot of surplus capacity.
(d) The petitioner has claimed the normal
value in the case of Japan on the basis of domestic price prevailing in Japan,
in the case of Portugal on the basis of domestic prices prevailing in Portugal
as well as on the basis of constructed cost of production, in the case of Spain
on the basis of domestic prices prevailing in Spain as well as on the basis of
constructed cost of production, and in the case of Italy on the basis of
domestic price prevailing in Italy as well as on the basis of constructed cost
of production.
(e) The petitioner has requested that EU as
whole should be considered for the purpose of levy of anti-dumping duty as
Portugal, Spain and Italy forms an integral part of European Union and are part
of 16 members European Union who have signed the common treaty which abolishes
all trade barrier between the European countries as trading, imports, exports
and sales. Thus the probe be against the European
Union as a whole.
(f) The petitioner is claiming injury due
to
- increase in imports from the subject countries
- increase in market share of import from the subject
countries
- selling
prices significantly lower than the cost of production resulting in huge
financial losses to petitioners.
- High level of stocks. Higher capacity
utilization, production and sales are at the cost of sales below cost of
production and high inventories
- The industry is finding it difficult to
expand in view of severe financial constraints arising out of sustained dumping
resulting in losses and poor market opportunities.
- Extremely
poor ability to raise funds
- Negative
return on massive investments
- Inability
to fund research and development.
C. 3
VIEWS OF EXPORTERS, IMPORTERS. AND
OTHER INTERESTED PARITES
I. IMPORTERS’ VIEW
(a) The claim made by the domestic industry
that there are five units in the country having installed capacity of 1,02,000 MT is not a factual information. It is
further stated that J.K. Synthetic Ltd. has gone into liquidation and taken
over by Board of Industrial & Financial reconstruction. The company is not
producing acrylic fibre for last three years.
(b) At present the effective capacity is not
more than 70000 Tonnes p.a. as the first plant of
IPCL established in 1979 has already lived its life. The aforesaid capacity of 70000 MT consist of 36000 tonnes
of wet spun acrylic fibre and-34UOOMT of Dry spun
acrylic fibre. This capacity is not sufficient to
meet the demand in the country.
(c) The consumption of acrylic fibre is continuously growing as it is a cheaper substitute
for the wool. Due to inadequate production of acrylic fibre
in the country, the spinning and knitting industry of acrylic had to depend
upon imports.
(d) The production as well
as imports of acrylic fibre are growing as the
consumption of acrylic fibre is increasing. The
domestic production is not able to meet the full requirement of total industry
and therefore imports are inevitable.
(e) The claim of the petition that
(f) Marubeni of Japan in collaboration is
putting up an acrylic fibre plant with a capacity of
34000 tons. In case the capacities in the countries were sufficient, such
international companies are not going to make such heavy investment in the
country.
(g) M/s Indian Acrylic Ltd is producing only
dry spun fibre made under Dupont Technology. The
total imports of fibre in the country constitute more
than 95% of the wet spun fibre and thus Indian
acrylic can not be considered to have suffered injury and thus can not be a
party, to petition. Imports of Dry spun fibre
is negligible.
(h) The market of acrylic in
(i) The production
undertaken by Indian manufacturer is just of routine type and can not cater to
all needs of acrylic industry. The claim of the domestic industry that the
process of manufacturing, the requirement of raw material and production cost
largely remain the same with respect of any deniers of fibre
is wrong and misleading.
(j) The long list of usage of acrylic fibre submitted by petitioner is misleading information
with regard to Indian market. 95% of the acrylic fibre
in
(k) The domestic manufacturers are creating
scarce situation by eliminating healthy competition from the foreign
manufacturers.
(1) Import of acrylic fibre
is never a cheaper substitute as the imports pan be effected only after payment
.of customs duty and CVD. Imports are effected not due
to its cheaper prices but due to non-availability of fibre
from domestic manufacturers.
(m) Domestic manufacturers always have a
tendency of charging higher price for the products. Their price quotation have
no relevancy to their major raw material i.e. Acrylonitrile
(ACN) which is 90% raw material of acrylic-fibre and
is always near to the price of DMT and PTA prices. DMT and PTA are raw material
for polyester fibre also. As on today the price of acrylic
fibre are double than the price of polyester fibre and therefore massive profits are being concerned by
acrylic fibre manufactures.
(n) The ACN prices have fallen considerably
during 1996-97 but the domestic manufacturers have not-reduced their prices and
have taken full benefits of scarce supply of acrylic fibre
in the country. Acrylic fibre manufacturers have
formed a forum which is monopolising the trade.
(o) The plant of the petitioner are being
run most inefficiently due to which their cost of production is higher and they
are adding this cost to the pricing of products. The domestic industry
production in 1996-97 was. 61187 MT against the installed
capacity of 102000 MT. Thus they are operating at about 60% of the
capacity due to which their cost of production is higher.
(p) The root cause of injury to domestic
industry is uneconomical plants, poor quality, and the erratic, supplies. The
domestic industry wants to pass of their inefficiencies on the Indian consumers
in the grab of Anti-dumping duties.
(q) The domestic producer of acrylic fibre are not interested in
Research and Development (R&D). They make very narrow range of fibres. The industry is left with no option but to rely on
imports of fibre to make a better product. The
spinning industry is already in recession. Any restrictive measure will lead to
the closure of the mills leaving thousands of workers unemployed. Anti-dumping
duties will raise the cost structure of the industry. Since Acrylic Fibre is a substitute of wool, the end product is used
mainly by lower section of society who will be hard hit. Such duties may
attract retaliatory measures from the affected countries with regards to export
of acrylic products from
(r) It is pointed out that M/s Mitsubishi
Rayon Co Ltd. is producing some special type of fibre
in their brand “Vonnel” and “finel”.
M/s Ashai of Japan is also producing a special fibre in the brand name of “Cashmilon”.
As no Indian manufacture is producing such type of special fibre,
these fibres be kept out of
preview of -antidumping duties.
II. EXPORTERS’ VIEW
(a) The petitioners do not satisfy the
definition of “domestic
industry” as per Rule 2(b). It is pointed out that petitioners have suggested
that four of the fibre producers be treated as domestic
industry. However JK Synthetic with an installed capacity of 24000 MT has been
closed and does not manufacture acrylic fibre for
lost two years. Indian acrylic with an installed capacity of 24000 MT Per
annual can not be considered as domestic. industry as
its subsidiary Indian Chemicals Ltd has imported acrylic fibre
from
(b) Calculation of dumping margin etc should
be done grade wise as done by Authority in the earlier case of Acrylic fibre from
(c) There is no injury to the petitioner.
(d) The loss suffered by domestic industry
earlier has been reduced .in 1996-97 in respect of one petitioner. Other
petitioner who were earlier incurring losses have started making, profit during
the period of investigation. The production and capacity utilisation
of the three petitioners have increased considerably. They are operating at
98-107% of capacity utilization. Sales price have decreased because the cost of
manufacture has decreased during the period of investigation. Acrylonityle (ACN) is the main raw material required for
manufacturing acrylic fibre. The price
of Acrylonityle have decreased from US$ 1400
PMT in 1995 to US$ 800 in February 1997. In domestic market the price of ACN
has gone down from Rs. 50000/- PMT in Feb 95 to Rs. 38000/- PMT in 1996-97. With reduction in the price of
major raw material, the cost of manufacture has reduced and hence the selling price have also reduced.
(e) The petitioner do
not have sufficient capacity to meet the demand. In future also, the domestic
industry including the capacity which are being
generated, will not be able to meet the growing demand of Acrylic Fibre, even if the domestic industry operates at 100%
capacity utilisation.
(f) Assessment of injury be done not
cumulatively but exporter wise as cumulative assessment of the effect of import
is inappropriate in view of the fact that different grades may be exported by
different exporters and the dumping margin and injury margin would have to be
computed exporter wise and grade wise.
(g) The increase in imports is due to the
fact that domestic producers have not been able to meet the demand even at near
full capacity utilisation.
(h) The exporters have denied to claim of domestic manufacture that they sold the fibre at a price below the cost of production as they have
made profits during period of investigation. Also none of the producers of
acrylic fibre have any plans for expansion of
capacities:
(i) The
question of ability to raise found is irrelevant. None
of the domestic producers have any R&D facilities.
(j) It is pointed out that the Designated
Authority has initiated the investigation on the basis of proof of domestic
price in
(k) The period of investigation fixed by
Designated Authority is unfair and damaging to exporters. By selecting in
period which is over nine months before the date of initiation notification,
the Designated Authority is calling upon historical data which has little or no
bearing upon the prevailing market conditions. The petitioner has deliberately
manipulated data to select a period in which imports from
(l) Domestic industry has higher production
cost for reasons particular to its economy. The Indian Industry has to bear
much higher interest and infrastructure cost making it incompetitiveness
in the international market. Injury to Indian Industry because of these factors
can not be attributed to dumping.
(m) There is no evidence of causal link
between the alleged dumped imports and the injury to the domestic industry in
the petition.
(n) Most of the Indian consumers have
purchased imported fibre for export of acrylic yarn
as these consumers enjoy certain benefits of duty. If the quantity of acrylic fibre imported and consumed for exports is excluded, the
balance quantity forms a very small percentage of indigenous capacity and
annual production.
(o) Quality of Indian fibre
is inferior.
(p) The acrylic fibre
exported from
(q) Comite
International De La Rayonnet Des Fibre
Syntheigues (CIRFS) on behalf of exporters from
D. EXAMINATION
OF THE ISSUES RAISED
4. The submission made by exporters,
importers, petitioner and other interested parties have been examined and
considered and have been dealt at appropriate places in these findings.
E. PRODUCT
UNDER CONSIDERATION
5. The product involved is Acrylic Fibre both in shrinkable and non-shrinkable form, ranging
from 1.5 Denier to 8.0 Denier and is classified under custom code 5501.30 and
5503.30 of Customs Tariff Act, 1975. The classification is however indicative
only and in no way binding on the scope of present investigation. The acrylic fibres is
a economical substitute of wool which is expensive. Acrylic fibre
is produced either through wet technology or dry technology. Acrylic fibre has application in day to day life use i.e. apparel,
household uses and some industrial use.
F. LIKE
ARTICLES
6. Acrylic fibre
is produced and sold in various specification. The various specification,
however, merely depict the properties of the fibre
and may result in varying end uses. However there is no significant difference
in terms of process, equipment or technology to produce different varieties of
acrylic fibre. It is also observed that market
pattern of different varieties is also similar. It is therefore considered that
acrylic fibre produced and sold by the domestic
industry has characteristics closely resembling to the acrylic fibres imported from
G. DOMESTIC
INDUSTRY
7. The petition is jointly filed by M/s
Indian Acrylics Ltd., Chandigarh, Pasupati
Acrylon Ltd., New Delhi, J.K. Synthetics Ltd.,
H. DUMPING
8. Under Section 9A(1)(C),
normal value in relation to an article means:
(i) The
comparable price, in the ordinary course of trade, for the like article when
meant for consumption in the exporting country or territory as determined in
accordance with the rules made under sub-section (6); or
(ii) When there are no sales of the like
article in the ordinary course of trade in the domestic market of the exporting
country or territory, or when because of the particular market situation or low
volume of the sales in the domestic market of the exporting country or
territory, such sales do not permit a proper comparison, the normal value shall
be either:
(a) comparable representative price of the
like article when exported from the exporting country or territory or an
appropriate third country as determined in accordance with the rules made under
sub section(6); or
(b) the cost of production of the said
article in the country of origin along with reasonable addition for
administrative, selling and general costs aid for profits, as determined in
accordance with the rules made under sub-section (6);
Provided that in the case of import of the article from a country other than the country of origin and where the article has been merely transshipped through the country of export or such article is not produced in the country of export or there is no comparable price in the country of export, the normal value shall be determined with reference to its price in the country of origin.
9. The Authority sent
questionnaires to the exporters from the subject countries in terms of the
section cited above. The claim made by the exporters with
regard to normal-value and export price are as under:
I. 10. CLAIMS OF THE EXPORTERS
Country:
a. Kanematsu Corporation,
Also almost all
the product exported by them were in 10 denier so that is coarser denier than
the Authority is investigating in this case. It is also stated that they
exported only *** kg of 5 denier fibre during the
said period and it is also a specialty type of fibre
which has a flat cross section. Based on this, they have stated that they are
not required to response to the questionnaire for exporters.
They have also
claimed that they shipped all mod acrylic staple fibre”
Kanecaron” brand of which “Kaneka Corporation” is the
producer. It is stated that they exported *** kg of this brand. It is also
claimed that “Kanecaron” brand mod acrylic fibre is not the object of the investigation and should be
excludes from the investigation on the following grounds.
(i)
“Kanecaron”
brand modacrylic fibre consist of acrylonitrial and polyvinyl-chloride with its ratio of
about 50-50%. This means the relative fibre has
content of a acrylonitrial
with less than 85%.
(ii) Modacrylic staple fibre is
totally not in production in
They have
submitted some invoices of exports to
b. Komatsuya Corporation
The exporter has
claimed that they were never the producer nor the
trader of Acrylic fibre. It is stated that they had
contributed to the customers to supply various kind of chemical and never
handled synthetic fibre and never exported acrylic fibre itself.
c. Itochu Corpn.
The exporter has
informed that during the period of investigation, they did not have any export
sale of acrylic fibre to
d. Mitsubishi Corporation
They have stated
that they have not made any export of acrylic fibre
to
e. Kaneka
Corporation/Mitsui & Co.
They have stated
that during the period of investigation they exported Kanecaron
brand modacrylic staple fibre
and pretax brand modacrylic staple fibre to
They have not
submitted the information called for in the formats in view of above and submitted
that on a prima facie basis, no case is made out for levy of anti-dumping duty
on its product either with respect to the product, the margin of alleged
dumping thereof or the resultant injury to the domestic industry.
f. Nichimen Corporation
They have stated
that they are a trading company and purchased the acrylic fibre
from the manufacturer under terms of “Makers FOB” and exported them to their
buyer under terms of CIF Bombay.
Thus they do not
know all charges before FOB and all charges after arrival of their cargo at
They have exported
one consignment to
g. Asahi Chemical
Industries Ltd. & Sumikin Bussan Corpn
It is claimed that
exports to
They have submitted
the price structure grade wise and in two parts. Part A deals with price
structure from the time sumikin purchases the goods
till sold on cif basis and part B deals with the
price structure till the fibres is sold to Sumikin.
Sumikin has claimed the deductions on account of overseas
freight, overseas insurance, Indian agent commission, bank charges, and Sumikin commission to arrive at the purchase price from Ashahi. M/s Ashahi has claimed
the deductions on account of inland freight, insurance, storage, selling and
general administration expenses while arriving at the ex-factory level of the
export price. They have given credit on account of interest received.
While calculating
the domestic price at ex-factory level, they have claimed price adjustments on
account of rebate, packing (label charges), inland freight including insurance
which is borne by trucking company), storage, selling and general admn. expenses. It is also claimed
that neither Ashahi nor Sumikin
received any incentive on export sales of acrylic fibre
from Government of Japan.
h. Mitsubishi Rayon Co Ltd.
(MRC)
It is claimed they
are the producer of rayon staple since 1933. It is claimed that three out of
five type of acrylic fibre exported by MRC to
It is further
submitted that MRC caters to Japanese and overseas market. In the overseas
market, MRC does not sell the goods directly and the same is sold through
traders. In case of
They have claimed
price adjustment on account of variable expenses, fixed expenses and indirect
expenses while arriving at the ex-factory level in the export price to
Marubeni Corpn.
It is claimed by
the exporter that they are a trading corporation and have been advised by
Mitsubishi and Toyobo to file responses to Designated Authority. It is stated
that they exported acrylic fibre to
However they have
not submitted any invoice or evidence in support of their claims.
Toyobo Company
Ltd.
It is stated by
them that they hold directly or indirectly 80% share of Japan Exlan Co who produces acrylic fibers and sell them
exclusively to Toyobo. Toyobo in turn sell under “Exclan”
brand name. Toyobo itself does not produce acrylic fibre.
Thus Toyobo has filed a consolidated reply with exlan.
It is also stated that during the period of investigation, exports were done
exclusively through Marubeni Corpn. Some special type
of fibre (of higher denier and or flat/section fibre) was exported through Kanematsu.
Further, Toyobo
sells in domestic market directly to consumers as also through a number of
Japanese trading houses.
It is further
claimed that since company does not directly exports goods to India, they do
have information about the expenses incurred by Marubeni on account of overseas
freight, marine insurance etc. it is stated that they exported conjugate type
(3.0 D and 2.5 D), Regular Type (1.4D, 2.0D & 3.OD) and special type
(4.51), 9.0D & 13. D) to
Country -
Monte fibre hispania S.A Spain
The exporter has
stated that they are a producer of acrylic fibre in
Courtaulds Espana SA
It is claimed that
they have neither received subsidies, nor tax exemptions nor
incentives on export sales and imported raw material purchases other
than suspension of raw materials tax import where they are incorporated into
export products. It appears that they are exporting 4 grades of acrylic fibres to
They have also
claimed that they are incurring loss on export sales to
Country -
They have claimed
that no incentive are given by the Italian Government
on export sales. It is stated that all their sales are on CIF Indian port
basis. They have claimed price adjustment on account of commission, inland
transport, overseas transport and insurance while calculating ex-factory level
in the export price to
The price claimed
at ex-factory level in respect of export to
Country -
Exporter
-- Fibras Sinteticas
De Portugal SA,
It appears that
they are exporting 3 grades of acrylic fibre viz Denier 2.2, Denier 3.3, and Denier 5.6. They do not
appear to have sales to other countries. They have claimed price adjustment on
account of discount, inland freight, overseas freight, overseas insurance
shipping charges while calculating export price to
It is also claimed
that no financial assistance is provided to customers. There is no special
price list for exports to
J. EXAMINATION OF THE CLAIMS OF THE EXPORTERS
BY THE AUTHORITY
11. On the basis of the
facts available with the Authority, it is observed that the various deniers of
Acrylic Fibres do not display any significant
difference in terms of the costs or prices and are in the same range. Moreover,
there is a considerable amount of substitutability among the different
varieties. The Authority has, therefore, grouped all fibres
(described as product under consideration) for these investigations.
DUMPING MARGIN
ASAHI CHEMICAL INDUSTRIES LTD.
NORMAL VALUE:
a) Normal Value is based on the weighted
average selling prices to the trading houses. Adjustments on account of
discounts given on invoices, packing, inland freight and expenses specific to
particular markets have been allowed. The Authority disallows claims made on
account of discounts based on turnover and end-use as the incidence of such
discounts/rebates is not ascertainable at the time of pricing decisions.
Adjustment on account of storage cost has been claimed on the basis of
inventories held by the company, which is also being disallowed.
i) The company
has exported the subject goods through Sumiken
Bussan, who have also furnished necessary information and were verified. The
export price has been determined on the basis of the CIF price at which goods
have been sold by Sumiken to the Indian buyers. While arriving at export price, adjustment on account of overs. - freight & insurance, bank charges,
commission to the Indian agent, inland freight and specific expenses on account
of export sales have been made to arrive at the ex-works export price. Asahi
has claimed expenditure incurred on account of loading of goods, their marking,
custom clearance, documentation and inspection under the head “storage”. Though
the expenditure has been claimed as storage costs, it is in the nature of
expenditure incurred by the company on export of goods and, therefore, has been
deducted from the selling prices. Further, Asahi has sold goods to Sumiken on credit and has charged interest on the credit
sales. This being an income of Asahi, has been added
to the selling price.
On the basis of
above, the normal value (ex-factory basis) is determined at US $ *** per kg. export price (ex-factory basis) is determined at US $ ***
per kg. Thus the dumping margin is US $ *** per kg., which is 24.36 % of the
export price.
TOYOBO CO.
NORMAL VALUE:
The selling price
has based on the basis of weighted average of the selling prices in the home
market. The company has claimed adjustments on account of differences in the
expenses incurred in the home market and exports to
EXPORT PRICE:
The company has
exported the subject goods through Marubeni Corpn.,
who have also furnished necessary information and the same were verified to the
extent deemed necessary. The export price has been determined on the basis of
the CIF price at which goods have been sold by Marubeni to Indian buyer.
Marubeni has claimed adjustments on account of ocean freight, insurance,
commission and interest on the basis of actual expenses and therefore, have
been allowed. Charges after ex factory and upto FOB
incurred by Toyobo Co and claimed as price adjustment on account of inland
freight, insurance, shipping charges and storage on the basis of the basis of
actual expenses incurred have been allowed.
On the basis of
above, the normal value (ex-factory basis) is determiner) at US $ *** per kg. export price (ex-factory basis) is determined at US $ ***
per kg. Thus the dumping margins is US $ *** per kg., which is 5.72 % of the
export price.
NORMAL VALUE:
The selling price
is based on the basis of average of the selling prices to a customer purchasing
highest volumes. It has, however, not been demonstrated by the company that the
selling prices to various customers depended on the volumes. It is also found
that the company has sold fibre to its related
companies. Selling prices have, therefore, been determined on the basis of
average selling prices after reducing sales to related companies.
The company has
claimed adjustments on account of differences in the expenses incurred in the
home market and exports to
EXPORT PRICE:
The company has
exported the subject goods through Marubeni Corpn.,
who have also furnished necessary information and the same were verified to the
extent deemed necessary. The export price has been determined on the basis of
the CIF price at which goods have been sold by Marubeni to Indian buyer.
Adjustments on
account of expenses after FOB and upto CIF for
overseas freight, overseas insurance, Indian agent’s commission
have been made.
i) Sumiken commission: This is the commission which Marubeni
has earned. This has been worked out by the company considering the price at
which the goods have been sold by Mitsubishi Rayon and prices at which goods
have been sold by Marubeni and considers all expenses incurred by Marubeni.
This is allowed.
Charges after ex-factory and upto FOB incurred by Mitsubishi have been adjusted. On the
basis of above, the normal value (ex-factory basis) is determined at US $ ***
per kg. export price (ex-factory basis) is determined
at US $ *** per kg. Thus the dumping margin is US $ *** per kg., which is 9.80
% of the export price.
Normal value is
based on the weighted average of the selling prices. Price adjustment claimed
on account of prompt payment discount, credit cost and inland freight are
allowed. During verification the exporter requested to allow a deduction equal
to the weighted average commission paid to Indian agent. This request is on the
grounds that exports to
Export price is
based on the weighted average selling prices. Adjustments have been made on
account of commission/rebate credit cost, inland freight, handling, ocean
freight and insurance.
On the basis of
above, the normal value (ex-factory basis) is determined at US $ *** per kg. export price (ex-factory basis) is determined at US $ ***
per kg. Thus, the dumping margin is US $ *** per kg., which is 38.01% of the
export price.
MONTEFIBRE
Normal value
Normal Value is
based on the weighted average selling price. Adjustments on account of prompt
payment, quantity discount, transport cost, promotion, advertisement, R&D,
technical services cost and stock (warehousing and financing cost) have been
claimed.
Prompt payment
and quantity discount has been, claimed on an estimation.
It is claimed that it varies from 1 to 4% and therefore an average of 2% has
been used to claim the deduction. Since actual data were not made available,
claim is not allowed on-estimates. Transport cost is the expense incurred by
the exporter and therefore is allowed. Regarding promotion, advertising,
R&D and technical service, cost it is claimed that these cost are allocated
to domestic sales and to EU countries and
Regarding stock
(warehousing and financing) claimed on the basis of inventory holding by the company
is not allowed. During verification the exporter requested to allow a deduction
equal to the weighted average commission paid to Indian agent. However in the
absence of substantiation by the exporter even at the time of verification
visit, the Authority is not in a position to allow this claim.
Export price
Export price is
based on the weighted average selling prices. Adjustment on
account of commission, inland transport, overseas transport and insurance have
been allowed.
On the basis of
above, the normal value (ex-factory basis) is determined at US $ *** per kg. export price (ex-factory basis) is determined at US $ ***
per kg. Thus the dumping margin is US $ *** per kg., which is 24.43% of the
export price.
Normal value
Normal Value is
based on the weighted average selling prices. Adjustments have been claimed on
account of discount, inland freight, storage charge and cost of credit. The
expenses on discount and inland freight are on the basis of expenses incurred
and hence allowed. Regarding storage, it is observed that adjustment on account
of storage cost has been claimed on the basis of excess inventory holding by
the company. This expenditure is not allowed. The cost of credit has been
worked out on approximation basis and may be allowed at USD *** per kg as there
is difference in the terms of sales in domestic market and export market.
During verification the company has also claimed adjustment on account of
technical assistance (expenses incurred in giving assistance to their domestic
customers and traveling expenses). The expenditure on this account is allowed.
Export price in
based on the weighted average selling prices. Adjustments have been made on
account of discounts/commission, inland freight, overseas freight, overseas
insurance and shipping charges.
On the basis of
above, the normal value (ex-factory basis) is determined at US $ *** per kg. export price (ex-factory basis) is determined at US $ ***
per kg. Thus the dumping margin is US $ *** per kg., which is 10.85 % of the
export price.
K. INJURY
12. Under Rule II supra, Annexure-I1, when a
finding of injury is arrived at, such finding shall involve determination of
the injury to the domestic industry, “taking into account all relevant facts,
including the volume of dumped imports, their effect on prices in the domestic
market for like articles and the consequent effect of such imports on domestic
producers of such article...” In considering the effect of the dumped imports
on prices, it is considered necessary to examine whether there
has been a significant price undercutting by the dumped imports as compared
with the price of the like article in India, or whether the effect of such imports
is otherwise to depress prices to a significant degree or prevent price
increase, which otherwise would have occurred, to a significant degree.
Annexure II(iii)
under rule 11 supra further provides that in case where imports of a product
from more than one country are being simultaneously subjected to Anti dumping
investigation, the Designated Authority will cumulatively assess the effect of
such imports, only when .it determines that the margin of dumping established
in relation to the imports from each country is more than two percent expressed
as percentage of export price and the volume of the imports from each country
is three percent of the imports of the like article or where the export of the
individual countries less than three percent, the imports cumulatively accounts
for more than seven percent of the imports of like article, and cumulative
assessment of the effect of imports is appropriate in light of the conditions
of competition between the imported article and the like domestic articles.
The Authority
notes that the margin of dumping and quantum of imports from subject country
are more than the limits prescribed above. Cumulative assessment of the effects
of imports is appropriate since the export prices from the subject country were
directly competing with the prices offered by the domestic industry in the
Indian market.
For the
examination of the impact of imports on the domestic industry in India, the
Authority has considered such further indices having a bearing on, the state of
the industry as production, capacity utilization, sales quantum, stock,
profitability, net sales realization, the magnitude and margin of dumping etc.
in accordance with Annexure II(iv) of the rules supra.
a. Quantum of Imports
The total imports
of acrylic fibre were 8195 MT, 10482 MT and 21114
during 94-95, 95-96 and 96-97. Thus the increase was 27.9% in 95-96 over 94-95
and 101% in 96-97 over 95-96. The increase was 158% in 96-97 over 94-95. Thus
the quantum of imports have significantly gone up
during the period of investigation. The quantum of imports from the said
countries was 3733 MT, 3396 MT and 9548 MT in 94-95, 95-96 and in 1996-97. It
is observed that quantum of imports from said countries decreased in 95-96 over
94-95 but in 96-97, it has gone up by 181% over 95-96. Thus there is a
significant rise in imports from said countries over the years. The quantum of
imports from other countries was 4462 MT, 7086 MT and 11566 MT in 94-95, 95-96
and 1996-97. The share of said countries in total imports
were 45.52%, 32.40% and 45.22%.
b. Production
and capacity utilisation.
It is observed
that the production capacity and production of the petitioners (viz Indian Acrylic, JK, Pasupati & Consolidated) are as
Year Capacity(MT) Production(MT) Capacity Utilization
1994-94 60,000 54717 91.2%
1995-96 68,000 48186 70.8%
1996-97 73,000 61187 83.8%
The additional capacities were generated by M/s Indian Acrylics over the years. It is also observed that the capacity utilisation of JK Synthetics were 66%, 28% and 29% in 94-95, 95-96 and in 96-97. The capacity utilisation of Pasupati, Consolidated and Indian Acrylic were 98%, 103% and 107%. Thus it is observed that the increase in production in 96-97 was 27% over 95-96 during this period whereas the growth in installed capacity was 7.35%. It is also observed that overall low capacity utilization during the period of investigation was due to extremely low capacity utilisation of JK Synthetics and other company’s capacity utilization was in the range of 98% to 107%.
c. Sales and Market share
It is observed
that demand of acrylic fibre was 83200 MT, 82000 MT
and 101000 MT in 94-95, 95-96 and in 1996-97 respectively. The share of imports
in total demand was 9.80%, 12.8% and 21% in 94-95, 95-96 and in 96-97
respectively. The share of Indian producers were
90.2%, 87.2% and 79% respectively in 94-95, 95-96 and in 1996-97. Thus it is
observed that the share of imports are rising in total
demand and the share of Indian Industry is going down in the total demand.
d. Closing stocks
It is observed
that the closing stocks of petitioner were 1255 MT, 381 MT and 2095 MT in 94-95,
95-96 and in 96-97 respectively. Closing stocks have significantly gone up in
96-97 over 95-96. It is also observed that out of 2095 tonnes
of closing stock, 1545 MT was held by Indian Acrylic.
e. Price undercutting and price
depression
The petitioner
companies have stated that imports from subject countries have been
undercutting the prices of the fibre being sold by
the Indian producers. The consumer industry is forcing Indian Industry to
reduce the price under the pretext of cheaper imports from the subject
countries. In view of this, they are forced to offer heavy discounts due to
threat posed by the dumped imports. Inspite of
increase in cost of producing acrylic fibre, the
Indian Industry is being prevented from increasing their selling prices. The
average selling price of the petitioner has increased marginally inspite of increase in ACN prices. Thus the dumped imports
from subject countries have -suppressed the prices of fibre
and caused immense losses to the petitioner. It is claimed that average selling
prices were Rs.***, ***, ***
and *** during 93-94, 94-95, 95-96 and 96-97. It is also shown that losses of the petitioner companies was 46 crores, 71 crores and 54 crores in 94-95, 95-96 and 96-97 respectively. However, it
is observed that different producers are charging different selling prices and
profit/loss of different companies varies.
It is observed
that the selling price charged were Rs. ***/-, Rs. *** Rs. *** and Rs.*** by JK, Pasupati,
Consolidated and Indian acrylic. At this price level, JK had suffered a loss of
29.66crores, and Consolidated suffered a loss of Rs.
38.72 crores. However, Pasupati
has earned a profit of Rs. 2.59 crores
and Indian Acrylic has earned a profit of Rs. 12.17 crores during the period if investigation.
f. Expansion of capacity
It is stated that
the plant of Indian acrylic was designed in such a way that the capacity was to
be increased from 12000 MT to 35000 Tonnes in.
stages. However the company is finding it difficult due to financial constraints.
g. Ability to raise funds
It is claimed
that most of petitioner companies are finding it difficult to repay loans and
interest thereon. Moreover, due to inability to service the loan already taken,
they are not able to raise funds further. This is affecting their future plans
of expansion. It is also stated that domestic industry is incurring substantial
cash losses resulting in negative cash flow. They are not able to get
reasonable return on the investment.
h. The petitioner has claimed that with
extensive research and development, the usage of acrylic fibre
can be increased. However this require extensive R&D efforts but which can
not be done by Indian Industry as even its survival is at stake in the wake of
continues dumping.
L. CONCLUSION
ON INJURY
13. In view of the foregoing paragraphs it is
observed that:
a) quantum of
imports from subject countries have increased in absolute terms and relative to
consumption in
b) the market share of the petitioner companies has gone down,
c) the domestic
industry has been forced to sell at prices below its fair price resulting into
losses or very low returns on investments,
d) the imports are undercutting the prices of the domestic
industry,
e) closing stock of domestic industry has gone up ,
f) the domestic
industry is not in a position to expand their capacities and do not have sound
liquidity position.
(g) The Authority, therefore, concludes that
the domestic industry has suffered material injury.
M. CAUSAL LINK
14. In establishing that the material injury
to the domestic industry has been caused by the imports from the subject
countries, the Authority holds that increase in market share of imports from
Japan, Portugal, Italy and Spain resulted in decline in the market share of the
petitioner, were undercutting the prices of the domestic product forcing the
domestic industry to sell below, its fair price. Resultantly, the domestic
industry was not in a position to recover fair selling price. The material
injury to the domestic industry was, therefore, caused by the dumped imports
from the said countries.
N. INDIAN
INDUSTRY’S INTEREST & OTHER ISSUES
15. The purpose of anti dumping duties, in
general, is to eliminate dumping which is causing injury to the domestic
industry and to re-establish a situation of open and fair competition in the
Indian market, which is in the general interest of the country.
16. It is recognized that the imposition of
anti dumping duties might affect the price levels of the products manufactured
using the subject goods and consequently might have some influence on relative
competitiveness of these products. However, fair competition on the Indian
market will not be reduced by the anti dumping measures, particularly if the
levy of the anti dumping duty is restricted to an amount necessary to redress
the injury to the domestic industry. On the contrary, imposition of anti
dumping measures would remove the unfair advantages gained by dumping
practices, would prevent the decline of the domestic industry and help maintain
availability of wider choice to the consumers of Acrylic Fibre.
Imposition of anti dumping measures would not restrict imports from the subject
countries in any way, and, therefore, would not affect the availability of the
product to the consumers.
17. To ascertain the extent of anti-dumping
duty necessary to remove the injury to the domestic industry, the Authority
rely upon reasonable selling price of Acrylic Fibre
in India for the domestic industry, by considering the optimum cost of production
at optimum level of capacity utilization for the domestic industry.
O. LANDED VALUE:
18. The landed value of imports is determined
on the basis of export price of Acrylic Fibre,
determined as detailed above in the para relating to
dumping, after adding the prevailing level of customs duties and one percent
landing and two percent handling charges.
P. CONCLUSIONS:
19. It is seen. after
considering the foregoing, that:
(a) Acrylic Fibre
described under para 5 and originating in or exported
from Japan, Spain, Portugal and Italy has been exported to India below normal
value, resulting in dumping;
(b) The Indian industry has suffered
material injury
(c) The injury has been caused cumulatively
by the imports from the subject countries.
20. It is considered necessary to impose anti
dumping duty, provisionally, pending final determination, on all imports of
Acrylic Fibre originating in or exported from the
subject countries, pending investigations.
21. It was considered whether a duty lower
than the dumping margin would be sufficient to remove the injury. Landed price
of the imports, for the purpose, was compared with the fair selling price of
the domestic industry, determined for the period of investigations. Wherever
the difference was less than the dumping margin, a duty lower than the dumping
margin is recommended. Accordingly, it is proposed that provisional anti
dumping duties be imposed, from the date of notification to be issued in this
regard by the Central Government, on all Acrylic Fibre
originating in or exported from Japan, Spain, Portugal and Italy falling under
Customs sub-heading 5501.30 and 5503.30 of the Customs Tariff Act, pending
final determination. The anti-dumping duty shall be the difference between the
amounts mentioned in column 4 and the landed price of imports per Kg. as per
details below subject to a minimum anti-dumping duty per kg. as
shown in column 5 below:
S. No Country Name
of the Producer Amount Amount
1 2 3 4
(Rs) 5(Rs)
1. Japan Asahi 82.97 9.04
Mitsubishi
Rayon 80.39 5.32
Toyobo
Inc. 77.45 2.87
Any
other exporter 82.97 9.04
2.
3.
4. Ital Any
exporter 82.97 11.12
22. Landed value of imports for the purpose
shall be the assessable value as determined by the Customs under the Customs
Act, 1962 and all duties of customs except duties levied under Section 3, 3A,
8B, 9 and 9A of the Customs Tariff Act, 1975.
Q. FURTHER
PROCEDURE:
23. The following procedure would be followed
subsequent to notifying the preliminary findings:
a. The Authority invites comments on these
findings from all interested parties and the same would be considered in the
final findings;
b. Exporters, importers; petitioners and
other interested parties known to be concerned are being addressed separately
by the Authority, who may make known their views, within forty days of the
dispatch of this notification. Any other interested party may also make known
its views within forty days from the date of publication of these findings.
c. The Authority would provide opportunity
to all interested parties for oral submissions;
d. The Authority would disclose essential
facts before announcing the final findings.
RATHI VINAY JHA, Designated Authority
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