The International Trade Administration Commission of South Africa (Itac) on 20 March 2015 gave notice of the initiation of a Sunset Review of the anti-dumping duties on fresh or chilled garlic, classifiable under tariff subheadings 0703.20 and 0712.90.90, originating in or imported from the People's Republic of China.
The notice follows an earlier one on 20 June 2014 in which Itac notified interested parties that unless a substantiated request was made indicating that the expiry of the anti-dumping duties would likely lead to the continuation or recurrence of dumping and material injury it would expire on 25 March 2015.
On 02 October 2014 Itac received a Sunset Review application from the South African Garlic Growers’ Association (SAGGA), representing 73% by production based on average land planted and average yield in 2014. The SAGGA submitted sufficient evidence and established a prima facie case to enable Itac to arrive at a reasonable conclusion that a sunset review investigation should be initiated.
The allegation of continuation and/or recurrence of dumping is based on the comparison between the normal values and the export prices. SAGGA stated that it could not obtain domestic price information in the People’s Republic of China (China). According to the Record of Understanding between Itac and the Bureau of Fair Trade for Imports and Exports (BOFT) of the Ministry of Commerce of the People's Republic of China, China will be treated as a market economy for purposes of these investigations. In instances where information of domestic selling prices in China is not reasonably available to the Southern African Customs Union (Sacu) industries, it is necessary to allow Sacu industries to use alternative methods, which are permitted by the World Trade Organisation (WTO), of determining a normal value in China for the subject product for the purposes of initiation of an investigation. SAGGA nominated Mexico as a surrogate country for normal value determination. Mexico was nominated because it has a similar industry to that of the PRC. There were no producers from Mexico who co-operated with the investigation. The normal value was determined based on the market price in Mexico.
The export price for China was determined based on the official import statistics obtained from Sars. On this basis, Itac found that there was prima facie proof of the likelihood of continuation and/or recurrence of dumping if the anti-dumping duties were removed.
SAGGA alleged and submitted prima facie evidence to indicate that should the anti-dumping duties be removed the alleged dumped imports were likely to increase and as a result the applicant was likely to experience price undercutting, price depression and price suppression. The information used to determine likelihood of recurrence/continuation of material injury is for Agribez Boerdery BK and Swartgoud Knoffel. SAGGA’s information indicated that it would also experience a decline in sales volumes and value, profit margins, output, market share, return on assets, employment, productivity, utilisation of capacity, growth and negative cash flow, if the duties were removed. On this basis Itac found that there was prima facie proof of recurrence of material injury if anti-dumping duties were removed.
The investigation period for dumping is from 1 July 2013 to 30 June 2014, and the material injury investigation involves evaluation of data for the period of 1 July 2011 to 30 June 2014 and estimates should anti-dumping duties be removed.
Comment is due by 27 April 2015.