On December 5, 2024, the Canada Border Services Agency officially announced the launch of an investigation into the potential dumping of corrosion-resistant steel sheet originating in or exported from Türkiye by Borçelik Çelik Sanayi. The investigation was initiated without a formal complaint, following the identification of evidence indicating possible harm to Canadian producers. The primary concern is that Borçelik may be selling these steel sheets at unfairly low prices, which could undermine Canadian producers by undercutting local prices, ultimately affecting fair competition in the Canadian market.
Dumping, the practice of selling goods in another country at prices lower than their normal value or cost of production, is a serious issue for many industries. In this case, the CBSA's concerns stem from a variety of economic indicators that suggest the Canadian market for corrosion-resistant steel sheets could be facing significant challenges. These indicators include lost sales by domestic manufacturers, price depression, and price undercutting, all of which could have serious financial repercussions for Canadian producers. Furthermore, the volume of dumped imports appears to be on the rise, potentially exacerbating these issues and harming the long-term viability of Canadian producers.
The Canadian industry that could be affected by these unfair practices includes major players like ArcelorMittal Dofasco G.P. in Hamilton, Material Sciences Corporation in Toronto, and Stelco Inc. in Hamilton. The corrosion-resistant steel sheet market in Canada is valued at approximately $1.4 billion annually, making it a key industry. The CBSA’s investigation comes in response to concerns that these imports could lead to depressed prices, making it more difficult for Canadian companies to compete. Moreover, there is growing concern that continued dumping could discourage future investments in the domestic steel industry, threatening both innovation and job creation within the sector.
The CBSA’s investigation, conducted under the Special Import Measures Act, will explore whether the steel sheets from Borçelik are being sold at unfair prices in Canada, a practice that could cause harm to Canadian producers. Simultaneously, the Canadian International Trade Tribunal will conduct a preliminary inquiry to assess whether the imports are damaging the Canadian industry. The CITT’s findings are expected by February 3, 2025, and will help determine whether the imports are indeed causing injury. The CBSA will also make its preliminary decision by March 5, 2025, which could potentially lead to the imposition of trade remedies if dumping is confirmed.
This investigation highlights the importance of Canada’s trade remedy system, which is designed to ensure that imported goods are priced fairly relative to domestic products. The CBSA has the authority to impose tariffs and other measures if it finds that dumping is occurring and is harming Canadian producers. In fact, the Canadian government currently has 158 special import measures in place, designed to protect various industries from unfair trade practices. These measures are estimated to safeguard approximately 31,000 Canadian jobs and protect $11.6 billion in domestic production.
The issue of dumping is particularly pertinent in the context of the global steel market, where volatile international market conditions and varying trade policies can significantly impact pricing dynamics. As Canada is one of the largest consumers of steel products globally, the attractiveness of the Canadian market to foreign suppliers, particularly those in regions with lower production costs, only increases the risks of unfair trade practices. Borçelik’s steel products, which have been identified as potentially being sold at unfair prices, could be an example of this trend, leading to further market instability and financial harm for Canadian manufacturers.
This investigation also comes amid broader global concerns over steel dumping, particularly from countries like China, South Korea, and India. In fact, Canada already has special import measures in place for corrosion-resistant steel sheets from several countries, including China, India, and South Korea. The new investigation into Borçelik’s steel is part of ongoing efforts by the CBSA to monitor international trade flows and protect domestic industries from unfair practices that could have long-term consequences for both the economy and the workforce.
As the investigation moves forward, the CBSA will continue to monitor the situation closely. A statement of reasons, providing further details about the case and the ongoing investigation, is expected to be made available on the CBSA’s website within 15 days. The outcome of this investigation will have significant implications for the Canadian steel industry, potentially shaping future trade policy and helping to maintain fair competition in the domestic market.
