Commission Implementing Regulation (EU) 2025/1139 of 6 June 2025 imposing a provisional anti-dumping duty on imports of hardwood plywood from the People’s Republic of China

Significant distortions according to Article 2(6a)(b), second indent of the basic Regulation: state presence in firms allowing the state to interfere with respect to prices or costs

• (131) The GOC is in position to interfere with prices and costs through state presence in firms. Indeed, CCP cells in enterprises, state-owned and private alike, represent an important channel through which the state can interfere with business decisions.

• (132) According to China’s company law, a CCP organisation is to be established in every company (with at least three CCP members as specified in the CCP Constitution ⁶⁹) and the company shall provide the necessary conditions for the activities of the Party organisation.

• (133) In the past, this requirement appeared not to have always been followed or strictly enforced. However, since at least 2016 the CCP has been reinforcing its claims to control business decisions in companies as a matter of political principle ⁷⁰, including exercising pressure on private companies to put ‘patriotism’ first and to follow Party discipline ⁷¹.

• (134) Already in 2018, it was reported that Party cells existed in 73 % of some 2,57 million privately owned companies, with growing pressure for the CCP organisations to have a final say over the business decisions within their respective companies ⁷². These rules are of general application throughout the Chinese economy, across all sectors, including to the producers of the product concerned and the suppliers of their inputs.

• (135) In addition, on 15 September 2020 a document titled General Office of CCP Central Committee’s Guidelines on stepping up the United Front work in the private sector for the new era ⁷³ (‘the Guidelines’) was released, which further expanded the role of the Party committees in private enterprises.

• (136) Section II.4 of the Guidelines states: ‘[w]e must raise the Party’s overall capacity to lead private-sector United Front work and effectively step up the work in this area’; and Section III.6 states: ‘[w]e must further step up Party building in private enterprises and enable the Party cells to play their role effectively as a fortress and enable Party members to play their parts as vanguards and pioneers’. The Guidelines thus emphasise and seek to increase the role of the CCP in companies and other private sector entities ⁷⁴.

• (137) The present investigation confirmed that overlaps between managerial positions and CCP membership/functions exist also in the hardwood plywood sector. For example, the general manager of Arser holds in parallel the position of the Party branch secretary and the chairman of the mother company Jiangsu High Hope Group also serves as the group’s Party committee secretary ⁷⁵.

• (138) Furthermore, the chairman of the board of directors of Guangxi Forestry Group Co., Ltd. serves as the secretary of the group’s Party committee ⁷⁶. Moreover, the company’s Party members are required to ‘take the lead in implementing all decisions and arrangements of the group's party committee, always strengthen responsibility, play a demonstration and leading role, and transform the results of party discipline learning and education into a powerful driving force for promoting the high-quality development of the group’ ⁷⁷.

• (139) Moreover, a member of SUMEC’s board of directors serves as the secretary of the company’s Party committee and the company’s general manager is also the deputy secretary of the company’s Party committee ⁷⁸.

• (140) Similarly, the deputy chairman of Luli Group Co., Ltd. serves in parallel as the secretary of the Party committee ⁷⁹. Also, the company’s secretary of the Party committee confirms that ‘Luli Group Co., Ltd. shall focus on the overall deployment of the Shougang Municipality Party Committee’s and the Municipal Government’s long term strategic goal of building a RMB 100 billion strong company’ ⁸⁰.

• (141) The state’s presence and intervention in the financial markets as well as in the provision of raw materials and inputs further have an additional distorting effect on the market ⁸¹. Thus, the state presence in firms, in the hardwood plywood and other sectors (such as the financial and input sectors) allows the GOC to interfere with respect to prices and costs.

Significant distortions according to Article 2(6a)(b), third indent of the basic Regulation: public policies or measures discriminating in favour of domestic suppliers or otherwise influencing free market forces

• (142) The direction of the Chinese economy is to a significant degree determined by an elaborate system of planning which sets out priorities and prescribes the goals the central, provincial and local governments must focus on. Relevant plans exist at all levels of government and cover virtually all economic sectors. The objectives set by the planning instruments are of a binding nature and the authorities at each administrative level monitor the implementation of the plans by the corresponding lower level of government.

• (143) Overall, the system of planning in the PRC results in resources being driven to sectors designated as strategic or otherwise politically important by the government, rather than being allocated in line with market forces ⁸².

• (144) The Chinese authorities have enacted several policies guiding the functioning of the sector hardwood plywood.

• (145) For example, the Guiding Opinion on Promoting the High Quality Development of Forestry and Grassland Industry ⁸³ (‘the Forestry Guiding Opinion’) contains also the following provisions: ‘By 2025, the system and mechanism for the rational utilization of forest and grass resources will be basically formed, the supporting capacity of forest and grass resources will be significantly enhanced, the output of high-quality forest and grass products will be significantly increased, and the trade of forest products will be further expanded, striving to increase the national forestry output value by 50 % on the current basis. […] By 2035, […] the scale of the forest and grass industry will be further expanded, […] the industry structure will be further optimized, the product quality and level of service will be comprehensively improved, the supervision of resource utilisation will be more efficient, so as to continuously enhance the sector’s capacity to serve national strategies’ ⁸⁴. The Forestry Guiding Opinion also requires to ‘promote the upgrading of the processing industry [by] optimizing the layout of the raw material base as well as of the forest and grass product processing industry’ ⁸⁵.

• (146) Furthermore, at provincial level, the Guangxi Autonomous Province – where the Guangxi Forestry Group Co., Ltd. is located, has adopted the 14th FYP on economic and social development and 2035 perspectives ⁸⁶ aiming to ‘complement, strengthen and extend advantageous industry chains’, including by ‘promot[ing] the transformation and upgrading of traditional industries such as […] wood processing’. Further, concerning the forestry processing industry, the addressees of the plan are required to: ‘focus on the development of papermaking [and] wood-based panels […]’ and ‘on building an entire industry chain of manufactured board, furniture and home furnishing.’

• (147) Also at local level, the Shuyang District (Jiangsu) adopted, in January 2024, the Opinion on the High Quality Development of Wood Processing and Furniture Manufacturing Industry ⁸⁷ aiming to ‘[b]y the end of 2026, cultivate 1-2 listed companies, 1-2 enterprise groups with an output value exceeding RMB 5 billion and continuously improve the overall quality of the industry [and] improve the industry chain, increase the share of finished products such as high-end flooring, furniture and decorative materials.’ To this end, it also specifies that ‘the plywood industry shall focus on the development of base products for furniture, solid wood composite flooring, household items, etc. [and that] the production capacity of plywood and blockboard production lines shall not be less than 10 000 cubic meters/year.’ Through these and other means, the GOC directs and controls virtually every aspect in the development and functioning of the sector, as well as the upstream inputs.

• (148) In sum, the GOC has measures in place to induce operators to comply with the public policy objectives concerning the sector. Such measures impede market forces from operating freely.

Significant distortions according to Article 2(6a)(b), fourth indent of the basic Regulation: the lack, discriminatory application or inadequate enforcement of bankruptcy, corporate or property laws

• (149) According to the information on file, the Chinese bankruptcy system delivers inadequately on its own main objectives such as to fairly settle claims and debts and to safeguard the lawful rights and interests of creditors and debtors. This appears to be rooted in the fact that while the Chinese bankruptcy law formally rests on principles that are similar to those applied in corresponding laws in countries other than the PRC, the Chinese system is characterised by systematic under-enforcement.

• (150) The number of bankruptcies remains notoriously low in relation to the size of the country’s economy, not least because the insolvency proceedings suffer from a number of shortcomings, which effectively function as a disincentive for bankruptcy filings. Moreover, the role of the state in the insolvency proceedings remains strong and active, often having direct influence on the outcome of the proceedings ⁸⁸.

• (151) In addition, the shortcomings of the system of property rights are particularly obvious in relation to ownership of land and land-use rights in the PRC ⁸⁹. All land is owned by the state (collectively owned rural land and state-owned urban land) and its allocation remains solely dependent on the state. There are legal provisions that aim at allocating land use rights in a transparent manner and at market prices, for instance by introducing bidding procedures. However, these provisions are regularly not respected, with certain buyers obtaining their land for free or below market rates ⁹⁰. Moreover, authorities often pursue specific political goals including the implementation of the economic plans when allocating land ⁹¹.

• (152) Much like other sectors in the Chinese economy, the producers of the product concerned are subject to the ordinary rules on Chinese bankruptcy, corporate, and property laws. That has the effect that these companies, too, are subject to the top-down distortions arising from the discriminatory application or inadequate enforcement of bankruptcy and property laws. Those considerations, on the basis of the evidence available, appear to be fully applicable also in the forestry and wood processing sector, and therefore hardwood plywood sector. The present investigation revealed nothing that would call those findings into question.

• (153) In light of the above, the Commission concluded that there was discriminatory application or inadequate enforcement of bankruptcy and property laws in the sector of the product concerned.

Significant distortions according to Article 2(6a)(b), fifth indent of the basic Regulation: wage costs being distorted

• (154) A system of market-based wages cannot fully develop in the PRC as workers and employers are impeded in their rights to collective organisation. the PRC has not ratified a number of fundamental ILO conventions, in particular those on freedom of association and on collective bargaining ⁹².

• (155) Under national law, only one trade union organisation is active. However, this organisation lacks independence from the state authorities and its engagement in collective bargaining and protection of workers’ rights remains rudimentary ⁹³. Moreover, the mobility of the Chinese workforce is restricted by the household registration system, which limits access to the full range of social security and other benefits to local residents of a given administrative area.

• (156) This typically results in workers who are not in possession of the local residence registration finding themselves in a vulnerable employment position and receiving lower income than the holders of the residence registration ⁹⁴.

• (157) No evidence was submitted to the effect that the hardwood plywood sector would not be subject to the Chinese labour law system described. The sector is thus affected by the distortions of wage costs both directly (when making the product concerned or the main raw material for its production) as well as indirectly (when having access to capital or inputs from companies subject to the same labour system in the PRC).

Significant distortions according to Article 2(6a)(b), sixth indent of the basic Regulation: access to finance granted by institutions which implement public policy objectives or otherwise not acting independently of the state

• (158) Access to capital for corporate actors in the PRC is subject to various distortions.

• (159) First, the Chinese financial system is characterised by the strong position of state-owned banks ⁹⁵, which, when granting access to finance, take into consideration criteria other than the economic viability of a project. Similar to non-financial SOEs, the banks remain connected to the state not only through ownership but also via personal relations (the top executives of large state-owned financial institutions are ultimately appointed by the CCP) ⁹⁶ and they regularly implement public policies designed by the GOC.

• (160) In doing so, the banks comply with an explicit legal obligation to conduct their business in accordance with the needs of the national economic and social development and under the guidance of the industrial policies of the state ⁹⁷. While it is acknowledged that various legal provisions refer to the need to respect normal banking behaviour and prudential rules such as the need to examine the creditworthiness of the borrower, the overwhelming evidence, including findings made in trade defence investigations, suggests that these provisions play only a secondary role in the application of the various legal instruments.

• (161) For example, the GOC has clarified that even private commercial banking decisions must be overseen by the CCP and remain in line with national policies. One of the state’s three overarching goals in relation to banking governance is now to strengthen the Party’s leadership in the banking and insurance sector, including in relation to operational and management issues ⁹⁸. Also, the performance evaluation criteria of commercial banks have now to, notably, take into account how entities ‘serve the national development objectives and the real economy’, and in particular how they ‘serve strategic and emerging industries’ ⁹⁹.

• (162) Furthermore, bond and credit ratings are often distorted for a variety of reasons including the fact that the risk assessment is influenced by the firm's strategic importance to the GOC and the strength of any implicit guarantee by the government ¹⁰⁰. This is compounded by additional existing rules, which direct finances into sectors designated by the government as encouraged or otherwise important ¹⁰¹. This results in a bias in favour of lending to SOEs, large well-connected private firms and firms in key industrial sectors, which implies that the availability and cost of capital is not equal for all players on the market.

• (163) Second, borrowing costs have been kept artificially low to stimulate investment growth. This has led to the excessive use of capital investment with ever lower returns on investment. This is illustrated by the growth in corporate leverage in the state sector despite a sharp fall in profitability, which suggests that the mechanisms at work in the banking system do not follow normal commercial responses.

• (164) Third, although nominal interest rate liberalization was achieved in October 2015, price signals are still not the result of free market forces but are influenced by government-induced distortions. The share of lending at or below the benchmark rate still represented at least one-third of all lending as of the end of 2018 ¹⁰². Official media in the PRC have recently reported that the CCP called for ‘guiding the loan market interest rate downwards’ ¹⁰³. Artificially low interest rates result in under-pricing, and consequently, the excessive utilization of capital.

• (165) Overall credit growth in the PRC indicates a worsening efficiency of capital allocation without any signs of credit tightening that would be expected in an undistorted market environment. As a result, non-performing loans have increased rapidly, with the GOC a number of times opting to either avoid defaults, thus creating so called ‘zombie’ companies, or to transfer the ownership of the debt (e.g. via mergers or debt-to-equity swaps), without necessarily removing the overall debt problem or addressing its root causes.

• (166) In essence, despite the steps that have been taken to liberalize the market, the corporate credit system in the PRC is affected by significant distortions resulting from the continuing pervasive role of the state in the capital markets. Therefore, the substantial government intervention in the financial system leads to the market conditions being severely affected at all levels.

• (167) No evidence was submitted in the present investigation demonstrating that the sector of the product concerned is not affected by the government intervention in the financial system in the sense of Article 2(6a)(b), sixth indent of the basic Regulation. Therefore, the substantial government intervention in the financial system leads to the market conditions being severely affected at all levels.

3.2.1.4.   Systemic nature of the distortions

• (168) The Commission noted that the distortions described in the Report are characteristic for the Chinese economy. The evidence available shows that the facts and features of the Chinese system as described above as well as in Part I of the Report apply throughout the country and across the sectors of the economy. The same holds true for the description of the factors of production as set out above and in Part II of the Report.

• (169) The Commission recalls that in order to produce the product concerned, certain inputs are needed. When the producers of the product concerned purchase/contract these inputs, the prices they pay (and which are recorded as their costs) are clearly exposed to the same systemic distortions mentioned before. For instance, suppliers of inputs employ labour that is subject to the distortions. They may borrow money that is subject to the distortions on the financial sector/capital allocation. In addition, they are subject to the planning system that applies across all levels of government and sectors. These distortions were described in detail above. The Commission pointed out that the regulatory setup underpinning those distortions is generally applicable, hardwood plywood producers being subject to those rules as any other economic operator in the PRC. The distortions have therefore a direct bearing on the cost structure of the product concerned.

• (170) As a consequence, not only the domestic sales prices of the product concerned are not appropriate for use within the meaning of Article 2(6a)(a) of the basic Regulation, but all the input costs (including raw materials, energy, land, financing, labour, etc.) are also affected because their price formation is affected by substantial government intervention, as described in Parts I and II of the Report.

• (171) Indeed, the government interventions described in relation to the allocation of capital, land, labour, energy and raw materials are present throughout the PRC. This means, for instance, that an input that in itself was produced in the PRC by combining a range of factors of production is exposed to significant distortions. The same applies for the input to the input and so forth.

• (172) No evidence or arguments to the contrary has been adduced by the GOC in the present investigation.

3.2.1.5.   Arguments from the interested parties

• (173) On 25 November 2024, PTIA submitted comments concerning the application of Article 2(6a) of the basic Regulation, arguing that the complainant’s analysis on significant distortions in the hardwood plywood sector in the PRC does not rely on sufficiently specific evidence. In particular, in PTIA’s view: (i) the references to the Commission's conclusions in relation to the okoumé plywood are irrelevant given the questionable overlap between the tropical family of wood species to which okoumé plywood belongs and the woods species of the product concerned; (ii) the complainant had relied on significant distortions in a too general manner, for example when referencing Arser as an SOE, even though that company represents less than 1 % of the total actual production capacity within a sector, which is in fact largely fragmented and not controlled by the state; (iii) it is not clear how the 14th Forest FYP specifically relates to hardwood plywood, in particular in view of the Plan’s focus on objectives pursued also by the EU, such as energy-saving and clean production technology; (iv) it is not clear how the Chinese policies which the complainant referred to and which aim to address the insufficient wood supply are linked to the alleged distortions.

• (174) The Commission disagreed. Concerning PTIA’s general argument on sufficiency of evidence to demonstrate the existence of significant distortions, the Commission recalled that according to Article 2(6a)(e) of the basic Regulation, if the Commission deems the evidence submitted by the complainants on the significant distortions sufficient, it can initiate the investigation on this basis. As confirmed by the General Court in Viraj Profiles, the quantity and quality of the evidence necessary to meet the criteria of the sufficiency of the evidence for the purpose of initiating an investigation is different from that which is necessary for the purpose of a preliminary or final determination of the existence of dumping, injury or of a causal link ¹⁰⁴.

• (175) Accordingly, the complainant’s reference to examples of significant distortions, whether concerning the presence of SOE’s in the sector of the product concerned (such as of Arser or the existence of government policies having distortive effects on free play of market forces (such as industrial planning documents and policies directly impacting import and export prices), as well as the complainant’s reliance on the relevant publicly available evidence, as also listed in the Notice of Initiation, are in line with the legal standards applicable at that stage of the investigation. In addition, the Commission noted that PTIA’s references to other jurisdictions allegedly pursuing certain policy goals similar to those of the GOC or PTIA’s claim that distortions exist also in other jurisdictions bear no relevance in the context of assessing the sufficiency of evidence at initiation.

• (176) Hence, the complaint met the standards set in Article 5(9) of the basic Regulation, in combination with Article 2(6a)(d). Indeed, as indicated in the Notice of Initiation, the Commission considered at the initiation stage that there was sufficient evidence pursuant to Article 5(9) of the basic Regulation tending to show that, due to significant distortions affecting prices and costs, the use of domestic prices and costs in the PRC would be inappropriate, thus warranting the initiation of an investigation on the basis of Article 2(6a) of the basic Regulation.

• (177) The Commission then proceeded to investigate such distortions in the context of the present investigation. In order to do so, the Commission has, in line with Article 2(6a)(e) of the basic Regulation, collected the data necessary to determine the existence and impact of significant distortions and the consequent use of the methodology prescribed by Article 2(6a)(a) of the basic Regulation. The data collected by the Commission and the resulting conclusions are presented in detail in Section 3.2.1 of this Regulation. Therefore, PTIA’s arguments on the evidence contained in the complaint could not be accepted.

• (178) On 20 March 2025, Jiangshan Wood submitted comments on the Second Note, arguing that the complainant misrepresents the Chinese industry by stating that Chinese hardwood plywood exporters are amongst the world’s largest producers and most of them are State-owned. According to Jiangshan Wood, this is misguided as the Chinese industry consists of many small producers, essentially SMEs. Moreover, Jiangshan Wood pointed out that certain companies (SUMEC, Arser), which the complainant had identified as producers, are in fact traders.

• (179) The Commission took note of Jiangshan Wood’s submission. However, the issues pointed out by the company cannot alter the Commission’s determinations concerning the existence of significant distortions. This is because those determinations are not based on the information contained in the complaint but on the entire body of evidence on file. The relevant evidence supporting the Commission’s findings is laid out in detail in Section 3.2.1.3, including certain clarifications concerning some of the market operators referred to by the complainant.

3.2.1.6.   Conclusion

• (180) In view of the above, the Commission concluded that it is not appropriate to use domestic prices and costs to establish normal value in this case. Consequently, the Commission proceeded to construct the normal value exclusively on the basis of costs of production and sale reflecting undistorted prices or benchmarks, that is, in this case, on the basis of corresponding costs of production and sale in an appropriate representative country, in accordance with Article 2(6a)(a) of the basic Regulation, as described in the following section.

3.2.2.   Representative country

3.2.2.1.   General remarks

• (181) The choice of the representative country was based on the following criteria pursuant to Article 2(6a) of the basic Regulation:

• — A level of economic development similar to the PRC. For this purpose, the Commission used countries with a gross national income per capita similar to the PRC on the basis of the database of the World Bank ¹⁰⁵,

• — Production of the product under investigation in that country,

• — Availability of relevant public data in the representative country,

• — Where there is more than one possible representative country, preference was given, where appropriate, to the country with an adequate level of social and environmental protection.

• (182) As explained in Section 3.1, the Commission issued two notes for the file on the sources for the determination of the normal value: the first note on production factors of 19 December 2024 and the second note on the production factors of 11 March 2025. These notes described the facts and evidence underlying the relevant criteria, and also addressed the comments received by the parties on these elements and on the relevant sources. In the Second Note, the Commission informed interested parties of its intention to consider Türkiye as an appropriate representative country in the present case if the existence of significant distortions pursuant to Article 2(6a) of the basic Regulation would be confirmed.

A level of economic development similar to the PRC where production of hardwood plywood takes place

• (183) In the First Note, the Commission identified Belarus, Brazil, Ecuador, Indonesia, Mexico, Malaysia, Russia, Thailand, Türkiye and Ukraine as being countries with a similar level of economic development as the PRC according to the World Bank, i.e. they are all classified by the World Bank as ‘upper-middle income’ countries on a gross national income basis where production of the product under investigation was known to take place.

• (184) The Commission considered that Belarus, Russia and Ukraine were not appropriate representative countries due to the fact that the Union imposed successive packages of sanctions on Belarus and Russia because of the military aggression by Russia against Ukraine. These restrictive measures with regards to Belarus included export restrictions on wood products including the product under investigation from the Union to Belarus ¹⁰⁶. Regarding Russia, the Commission noted that imports of birch plywood are subject to anti-dumping duties since 2021 ¹⁰⁷. In addition, imports into the Union from Russia of products falling under Chapter 44 (including plywood and veneer, which are the main raw materials to produce plywood) are subject to restrictions since 10 July 2022 ¹⁰⁸. Apart from the fact that the situation in Ukraine was heavily impacted by the ongoing conflict with Russia, according to the complainant, Ukraine primarily produced hardwood plywood of birch species, whereas the product definition encompasses various other hardwood species ¹⁰⁹.

• (185) The Commission further noted that among the potentially representative countries, Ecuador and Mexico had production of mainly softwood species. Therefore, the possible representative countries remained Brazil, Indonesia, Malaysia, Thailand and Türkiye.

Availability of relevant readily available data in the representative country

• (186) The Commission subsequently looked whether there were readily available data in the countries identified above. It first noted that with regard to Indonesia, there were no readily available data in m³, which is the unit of measurement used both by the Union industry and the Chinese exporting producers, on imports of factors of production in Indonesia. Additionally, most of the hardwood plywood production in Indonesia was produced from tropical wood species (and not from poplar or birch, which were most commonly represented in the PRC and the Union). Also, while statistics were available for Brazil and Thailand, both countries imported significant volumes of veneer from the PRC. Similar to Indonesia, most of the hardwood plywood production in Malaysia was produced from tropical wood species (and not from poplar and birch, which were most commonly represented in the PRC and the Union) and there were no import data on poplar logs.

• (187) On this basis the Commission concluded that Türkiye was the only country with a significant production of hardwood plywood of the same species of wood (poplar, birch, and eucalyptus) that were produced in the PRC, and which were, at the same time, mostly imported into the Union from the PRC. The Commission further noted that Türkiye was the only country for which statistics contained data on imports of the most important factors of production, despite the lack of reliable import data on veneer and on eucalyptus logs.

• (188) The Commission identified five producers in Türkiye with publicly available financial information: Isik Ahsap Profil Lojistik Sanayi Ve Ticaret Anonim Sirketi, Epalsan Orman Urunleri Nakliye Sanayi Ve Ticaret Linited Sirketi, Sakarya Kerestecilik Sanayi Ve Ticaret Anonim Sirketi, Murat Sahin Orman Urunleri Insaat Mimarlik Nakliyat Sanayi Ve Ticaret Limited Sirketi, and AGL Ahsap Sanayi Anonim Sirketi.

• (189) Interested parties were invited to comment on the appropriateness of Türkiye as a representative country and of the above-mentioned companies as producers in the representative country.

• (190) The Commission received comments from the cooperating exporting producer, Jiangshan Wood. In its comments following the First Note, Jiangshan Wood considered that the Commission should not have discarded Indonesia on the grounds that import data in statistics were reported in weight (kg) and not in m³, because the weight could be converted in m³ based on the conversion ratios Jiangshan Wood provided. Jiangshan Wood argued that Indonesia was the most appropriate representative country as the statistical data contained imports of all important factors of production, at prices in line with the market prices. In addition, it pointed to companies in Indonesia with readily available information.

• (191) Furthermore, Jiangshan Wood submitted that Türkiye was not the most suitable representative country for most of the factors of production because there was no data in the statistics, and because the value reported in Eurostat for poplar logs was too high and did not correspond to the market value.

• (192) The Commission considered that while for some factors of production, such as specific types of logs, a conversion factor could be used, for some others, such as veneer, the HS code covers several wood species, and a conversion would be biased by the fact that the conversion factor varies considerably depending on the wood used for the veneer. Additionally, the hardwood plywood produced in Indonesia is mainly from tropical wood species such as teak, meranti, or sengon/Albasian ¹¹⁰ while the most represented wood species used for the production of the product concerned imported from the PRC to the Union are poplar, birch and eucalyptus. Furthermore, the quantities of the different factors of production imported into Indonesia in the IP were relatively low.

• (193) Türkiye, on the other hand, had in the IP a considerable production of hardwood plywood which employs predominantly species such as poplar, birch and beech. Türkiye Forest Products Annual Market Review 2021 mentions that in 2020, the production of plywood was 300 000 m³ and the same volume was forecasted for 2021 ¹¹¹. Although the statistics related to 2020 (and the forecast to 2021), it was assumed that a similar level of production took place during the IP. Therefore, the Commission maintained its selection of Türkiye as the representative country and the arguments raised by Jiangshan Wood were rejected.

Level of social and environmental protection

• (194) Having established that Türkiye was the only available appropriate representative country, based on all of the above elements, there was no need to carry out an assessment of the level of social and environmental protection in accordance with the last sentence of Article 2(6a)(a) first indent of the basic Regulation.

3.2.2.2.   Conclusion

• (195) In view of the above analysis, Türkiye met the criteria laid down in Article 2(6a)(a), first indent of the basic Regulation in order to be considered as an appropriate representative country.

3.2.3.   Sources used to establish undistorted costs

• (196) In the First Note, the Commission listed the factors of production, such as materials, energy and labour, used in the production of the product under investigation by Jiangshan Wood. In this note, the Commission identified imports into the possible representative countries of the main factors of production and it noted that the data on imports into Türkiye contained data on imports for the most important factors of production, despite the lack of reliable import data on sheets for veneers for plywood and eucalyptus logs. Therefore, in terms of statistical data on imports of factors of production, the Commission concluded that the most detailed data was available in Türkiye. On this basis, the Commission invited the interested parties to comment and propose publicly available information on undistorted values for each of the factors of production mentioned in that note.

• (197) Subsequently, in the Second Note, the Commission further looked into how to establish a benchmark value for the factors of production identified in the First Note, in order to construct the normal value in accordance with Article 2(6a)(a) of the basic Regulation. Article 2(6a)(a) of the basic Regulation prescribes the use of corresponding data in an appropriate representative country ‘provided that the relevant data are readily available’.

• (198) In the present case, although statistics contained data on imports of poplar logs and eucalyptus veneer into Türkiye, these two major factors of production were not imported to Türkiye (nor to any other country, including the other possible representative countries) in representative quantities. Consequently, the Commission concluded that the prices of these imports were not representative of market prices.

• (199) The Commission therefore searched for another benchmark price representative for a market price. It identified the biggest exporters worldwide of poplar logs and eucalyptus veneer. Since the statistics on exports from the biggest exporting countries of these two factors of production contained data on considerable export volumes, the Commission proposed, in the Second Note, to base the benchmark price for poplar logs and eucalyptus veneer on the export price from the biggest exporting countries: worldwide exports from France for poplar logs and worldwide exports from Ukraine for eucalyptus veneer.

• (200) The other two important factors of production, laminates paper and flour, were imported into the proposed representative country (Türkiye) in significative quantities and therefore, the Commission considered that the import prices of laminates paper and flour into Türkiye (excluding imports from China and countries listed in Annex I of Regulation (EU) 2015/755 of the European Parliament and of the Council ¹¹²) were representative of the market prices.

• (201) In addition, the Commission stated that it would use the Turkish statistics for establishing undistorted costs of labour ¹¹³ and energy ¹¹⁴.

• (202) In the Second Note, the Commission also informed the interested parties that due to the negligible weight of some of the individual factors of production in the total cost of production, these negligible individual items were grouped under ‘consumables’. Further, the Commission informed that it would calculate the percentage of the consumables on the total cost of raw materials and apply this percentage to the recalculated cost of raw materials when using the established undistorted benchmarks in the appropriate representative country.

3.2.3.1.   Comments on the sources to establish the undistorted costs proposed in the Second Note

• (203) After the publication of the Second Note, the complainant mentioned its support for the choice of the Commission to establish a replacement cost for construction of normal values using the average price of France’s exports of poplar logs. It considered that the average price of France’s exports of poplar logs as reported in the Second Note (117 EUR/m³) was reasonable.

• (204) Jiangshan Wood also submitted that it appreciated the Commission’s reasonable approach on the benchmark for poplar logs. It mentioned however that a more reasonable approach would be to take the intra-Union import statistics with prices in line with trading prices between Canada and the US.

• (205) The Commission took the comments into account, but maintained that the average price of France’s exports of poplar logs was representative of the market price, as being the biggest exporter worldwide. The Commission, however, corrected clerical errors that stemmed from double entries, and updated the benchmark price accordingly (see Section 3.2.3.2 Raw materials).

• (206) With regard to eucalyptus veneer, the complainant argued that Ukraine did not produce (grow/harvest) eucalyptus trees on a commercial scale, due to unsuitable climate conditions, and therefore, the significant export volumes from Ukraine under HS code 4408 90 corresponded in all likelihood to veneers of birch and beech species, or other non-coniferous species, but not to eucalyptus veneers. It also considered that the resulting average price of exports from Ukraine (251,49 EUR/m³) did not reflect the prices of eucalyptus veneers, which were considerably higher, and that, hence, the proposed benchmark was too low. It submitted that the starting price of eucalyptus veneer was up to three times higher than the Commission’s benchmark, and that it should be in average around 520 EUR/m³. To demonstrate the price ranges, the complainant submitted sensitive bills of eucalyptus veneer originating in Uruguay and Paraguay, which it considered to be one of the largest and most known sources of eucalyptus veneers for the hardwood plywood production.

• (207) As a response to the comments by the complainant, PTIA submitted that the benchmark price for the eucalyptus veneer was too high. It argued that the Commission could use instead the price of Brazilian imports into the Union of eucalyptus logs, which would result in a benchmark price of around 55 EUR/m³, or alternatively, the import price of eucalyptus logs into the PRC at a similar level. It submitted as additional evidence invoices and contracts of eucalyptus logs from Uruguay and from Brazil.

• (208) The Commission first noted that, indeed, HS code 4408 90 was a basket code that included veneers made of more hardwood species, and not only of eucalyptus. It also accepted the comment from the complainant that since eucalyptus was not grown in Ukraine, the exports under that code from Ukraine was more likely to include other wood species rather than eucalyptus.

• (209) The Commission, however, disagreed with the claim of PTIA that the price for the eucalyptus veneer could be based on the price per kg of the eucalyptus imports of logs into the Union or to the PRC. The statistics for imports of the eucalyptus logs only existed in kg and therefore could not be directly used to establish a price per m³. Furthermore, the Commission could not accurately establish what is the consumption of the eucalyptus logs per m³ of veneer, as the consumption ratio largely depends on the quality of the logs and the production process. Finally, any benchmark price of eucalyptus logs would have to be adjusted to take into account the added value of the production process to produce eucalyptus veneer from the logs. For the same reasons as above, i.e. the relevance of the quality of the logs and the production process, the Commission was not in a position to accurately calculate such added value. For these reasons, the Commission disagreed that in this specific case, a benchmark for eucalyptus veneer should be based on the price of the eucalyptus logs, which is an input material and different product than veneer.

• (210) The Commission further considered that even if it opted for exports of eucalyptus veneer from another specific country where eucalyptus was grown, the HS code remained a basket code and included all types of hardwood species, some of which could be considerably cheaper than eucalyptus, whereas some other species are considerably more expensive than eucalyptus (such as various exotic tropical species used exclusively as top-quality face veneers), including for exports from Uruguay and Paraguay where more hardwood species are grown. Since the prices based on particular invoices could not be considered as representative evidence to establish the market price, the Commission found it most appropriate to establish the benchmark price based on an average export price (of around 443 EUR/m³) from the biggest exporting countries under the HS code 4408 90 (including eucalyptus and veneer of species similar to eucalyptus), which was in line with the price of the eucalyptus exports from Paraguay and Uruguay, submitted by the complainant. The Commission thus adapted the benchmark price accordingly.

• (211) Concerning the benchmark for flour, Jiangshan Wood considered that the flour market in Türkiye was distorted and therefore the price of the imports was not representative as a benchmark price. It argued that Türkiye put in place a series of measures that distorted the market: since May 2023, a 130 % tariff on imports of wheat (and 0 % if the imported wheat is processed into flour or pasta which is exported), and a 102,6 % tariff on imports of wheat flour. Jiangshan Wood submitted that the tariffs were designed to prohibit flour imports and to promote the domestic processing of cheap imported wheat into flour for export. It also claimed that exports of flour from Türkiye decreased significantly which meant that during the IP, flour prices in Türkiye were distorted and inflated. Jiangshan Wood argued that, in addition, Türkiye imposed a number of restrictions on the importation of flour, including import licensing and inspection requirements. Jiangshan Wood therefore argued that the Commission should use an undistorted price for flour when determining the normal value which could be the CIF (Cost, Insurance and Freight) Türkiye import price, without applying the 102,6 % import tax.

• (212) Jiangshan Wood also submitted that the HS code used by the Commission (HS 1101 00 00 ) contained flour used for food products, and not only for hardwood plywood. It submitted that when determining the benchmark price for flour, the Commission should use HS code 1101 00 15 (HS code for wheat or meslin flour of common wheat and spelt) instead.

• (213) The Commission rejected the argument that, because of the alleged distortions on the Turkish market, it should not consider the import duty. The quantities of flour imported to Türkiye were significant, so there was a demand for flour at prices including the import duties. Therefore, its price was considered representative of a market price. The Commission thus rejected the claim that the price of flour did not constitute a representative benchmark and maintained its approach as explained above. The Commission, however, accepted the argument of Jiangshan Wood to use the HS code 1101 00 15 to establish the price, instead of the general code for flour (HS 1101 00 00 ).

• (214) Jiangshan Wood also submitted that the benchmark for labour and electricity was unnecessarily inflated since the Commission, first, converted Turkish Lira (‘TRY’) to EUR and then EUR to Chinese Yuan (‘CNY’) and that it was therefore influenced by bilateral TRY to EUR exchange rate fluctuations. It submitted that the Commission should convert TRY to CNY directly by using the average exchange rate of 0,22211, published at https://www.xe.com/.

• (215) The Commission rejected the claim. Indeed, exchange rates published by other sources such as the one mentioned by Jiangshan Wood may differ from the ones used by the Commission to establish the benchmark price. However, the Commission relied, in line with its practice, on the official exchange rates published by the European Central Bank, which were the official exchange rates in the IP. The exchange rates published by the European Central Bank allow the Commission to determine a direct conversion from TRY to EUR (using in this specific case the exchange rate 0,2434). The benchmark price determined based on the conversion leads to the same benchmark price in CNY as determined by the Commission. The claim was thus rejected.

3.2.3.2.   Factors of production

• (216) Considering all the information submitted by the interested parties and collected during the verification visits, the following factors of production and their sources have been identified in order to determine the normal value in accordance with Article 2(6a)(a) of the basic Regulation:

Table 1

Factors of production of product under investigation

Factor of Production	HS Code	Source	Undistorted value	Unit of measurement
Raw materials	Raw materials	Raw materials	Raw materials	Raw materials
Poplar log	4403 97	Global Trade Atlas (‘GTA’)115	1 003,09 CNY	m3
Eucalyptus veneer	4408 90	GTA	4 232,09 CNY	m3
Laminates paper	4811 49	GTA	25,38 CNY	kg
Flour	1101 00 15	GTA	5,31 CNY	kg
Consumables	Consumables
Labour	Labour
	n/a	National statistics	43,76 CNY	hour
Energy	Energy
Electricity	n/a	Turkish Energy Market Regulatory Authority	0,77 CNY	KWh

• (217) The Commission included a value for manufacturing overhead costs in order to cover costs not included in the factors of production referred to above. To establish this amount, the Commission expressed the manufacturing overhead cost incurred by the cooperating exporting producer for the production of the product under investigation as a percentage of the actual cost of the used raw materials and then applied the same percentage to the undistorted cost of the same raw materials in order to obtain the undistorted manufacturing overhead cost. The Commission considered that, in the context of this investigation, the ratio between the exporting producer’s raw material and the reported overhead costs could be reasonably used as an indication to estimate the undistorted manufacturing overhead costs when delivered to the company’s factory.

3.2.3.3.   Raw materials

• (218) In order to establish the undistorted price of two main raw materials, poplar log and eucalyptus veneer, the Commission used a weighted average export price of the biggest exporters of these materials worldwide – France in case of poplar logs and an average of the main exporting countries in case of eucalyptus veneer ¹¹⁶. Export prices were at Cost, Insurance and Freight (‘CIF’) level, to which the Commission added import duties of 4,1 % in case of poplar logs and 2,5 % in case of eucalyptus veneer, which was considered reasonable, and in line with average import duties levied by ten biggest importing countries covering between 84 % to 99 % of the worldwide imports of these wood products.

• (219) For the two other remaining raw materials, laminates paper and flour, the Commission established the benchmark based on the weighted average import price to the representative country, as reported in the GTA, to which import duties and transport costs were added. An import price in the representative country was determined as a weighted average of unit prices of imports from all third countries excluding the PRC and the countries listed in Annex 1 to Regulation (EU) 2015/755 ¹¹⁷. The Commission decided to exclude imports from the PRC into the representative country, as it concluded in Section 3.2.1.5 above, that it is not appropriate to use domestic prices and costs in the PRC due to the existence of significant distortions in accordance with Article 2(6a)(b) of the basic Regulation. Given that there is no evidence showing that the same distortions do not equally affect products intended for export, the Commission considered that the same distortions affected export prices.

• (220) For a number of factors of production, the actual costs incurred by the cooperating exporting producers represented a negligible share of total raw material costs in the review investigation period. As the value used for these had no appreciable impact on the dumping margin calculations, regardless of the source used, the Commission decided to include those costs into consumables. The Commission calculated the percentage of the consumables on the total cost of raw materials and applied this percentage to the recalculated cost of raw materials when using the established undistorted prices.

• (221) In order to establish the undistorted price of raw materials, as provided by Article 2(6a)(a), first indent of the basic Regulation, the Commission added the relevant import duties to the CIF value recorded in the import statistics of the representative country, as available in GTA.

• (222) The Commission expressed the transport cost incurred by the cooperating exporting producer for the supply of raw materials as a percentage of the actual cost of such raw materials and then applied the same percentage to the undistorted cost of the same raw materials in order to obtain the undistorted transport cost. The Commission considered that, in the context of this investigation, the ratio between the exporting producer’s raw material and the reported transport costs could be reasonably used as an indication to estimate the undistorted transport costs of raw materials when delivered to the company’s factory.

3.2.3.4.   Labour

• (223) The Turkish Statistical Institute publishes detailed information on wages in different economic sectors in Türkiye ¹¹⁸. The Commission used the latest available statistics covering 2022 for average labour cost for the economic activity C.16 Manufacture of wood and of products of wood and cork, except furniture; manufacture of articles of straw and plaiting materials) according to NACE Rev.2 classification. The 2022 average monthly value was duly adjusted for inflation using the labour cost index as published by the Turkish Statistical Institute to adapt to the IP (1 July 2023 to 30 June 2024) ¹¹⁹.

3.2.3.5.   Electricity

• (224) The Commission used the electricity price statistics published by the Energy Market Regulatory Authority (EMRA) in its regular press releases. The Commission used the data of the industrial electricity prices in kWh for the industrial sector covering the IP (1 July 2023 to 30 June 2024) ¹²⁰.

3.2.3.6.   Manufacturing overhead costs, SG & A, profits and depreciation

• (225) According to Article 2(6a)(a) of the basic Regulation, ‘the constructed normal value shall include an undistorted and reasonable amount for administrative, selling and general costs and for profits’. In addition, a value for manufacturing overhead costs needs to be established to cover costs not included in the factors of production referred to above.

• (226) When establishing benchmarks for SG & A and profit, the Commission initially proposed to use financial data of five Turkish companies, which were available in the ORBIS database for a period preceding the IP.

• (227) Both Jiangshan Wood and PTIA submitted that the Turkish company Isik Ahsap Profil Lojistik Sanayi Ve Ticaret Anonim Sirketi (‘Isik’) did not produce plywood but other wood products such as wall panels, flooring made of MDF, chipboards or particleboards, and therefore, that its data should be excluded from the calculations.

• (228) Jiangshan Wood further submitted that with respect to the SG & A of Murat Sahin Orman Urunleri Insaat Mimarlik Nakliyat Sanayi Ve Ticaret Limited Sirketi (whose trade name is Tokpan) as well as for Isik, the Commission must deduct an amount for direct selling expenses from the SG & A. The Commission finally used the SG & A and profit data from Turkish statistics because the financial data of the five Turkish companies that were available in the ORBIS database did not overlap with the IP and no recent update of this data was available in ORBIS. As such, the Commission decided to use the Turkish government’s data of the average operating expenses and operating profit of the companies published by the Central Bank of Türkiye on the financial results of the 3 121 companies with activities in the sector of wood products, cork, straw and plaiting materials manufacturing (NACE – C-162), which it considered official and reliable. The Commission therefore did not need to address any further the comments of Jiangshan Wood and PTIA concerning the financial data of the five Turkish producers.

• (229) On this basis, the SG & A expressed as a percentage of the Costs of Goods Sold (‘COGS’) and applied to the undistorted costs of production amounted to 16,1 %. The profit expressed as a percentage of the COGS and applied to the undistorted costs of production amounted to 8,4 %.

3.2.3.7.   Calculation

• (230) On the basis of the above, the Commission constructed the normal value per product type on an ex-works basis in accordance with Article 2(6a)(a) of the basic Regulation.

• (231) First, the Commission established the undistorted costs. The Commission applied the undistorted unit costs to the actual consumption of the individual factors of production of the cooperating exporting producer. These consumption rates provided by the cooperating exporting producer were verified during the verification. The Commission multiplied the usage factors by the undistorted costs per unit observed in the representative country, as described in this section.

• (232) Once the undistorted manufacturing costs established, the Commission applied to the undistorted costs the manufacturing overheads and depreciation, in order to arrive at the undistorted costs of production.

• (233) To the costs of production established as described in the previous recital, the Commission applied the SG & A ¹²¹ and the profit ¹²² established as described above.

• (234) On that basis, the Commission constructed the normal value per product type on an ex-works basis in accordance with Article 2(6a)(a) of the basic Regulation.

3.3.   Export price

• (235) Jiangshan Wood exported to the Union through unrelated traders in the PRC. Therefore, the export price was the price actually paid or payable by the first unrelated customer (a domestic trader) for the product concerned when sold for export to the Union, in accordance with Article 2(8) of the basic Regulation.

3.4.   Comparison

• (236) Article 2(10) of the basic Regulation requires the Commission to make a fair comparison between the normal value and the export price at the same level of trade and to make allowances for differences in factors which affect prices and price comparability. In the case at hand the Commission chose to compare the normal value and the export price of Jiangshan Wood at the ex-works level of trade. As further explained below, no adjustments to the ex-works normal value nor the ex-works export price, as reported by Jiangshan Wood, was done.

• (237) However, the CIF value established to be used as a denominator for the dumping calculations was based on the ex-works price of Jiangshan Wood to which the Commission added sea freight costs, as well as the SG & A and profit of an unrelated trader. To establish these adjustments to arrive from the ex-works price to the CIF value, the Commission relied on publicly available information (Drewry World Container Index) in case of sea freight ¹²³, and on the financial report of one of the unrelated traders provided by Jiangshan Wood. The Commission invited the unrelated traders of Jiangshan Wood to cooperate to provide their actual data on sea freight costs, the SG & A and profit. Since the Commission received a reply from the traders too late to be considered for the provisional findings, the level of these adjustments may change at the definitive stage of the investigation.

3.4.1.   Adjustments made to the normal value

• (238) The normal value was established at the ex-works level of trade by using costs of production together with amounts for the SG & A and profit, which were considered to be reasonable for that level of trade. Therefore, no adjustments were necessary to net the normal value back to the ex-works level.

• (239) The Commission found no reasons for making any allowances to the normal value, nor were such allowances claimed by the exporting producer.

3.4.2.   Adjustments made to the export price

• (240) Since Jiangshan Wood sold at an ex-works level of trade, no adjustments to the export price were made.

3.5.   Dumping margin

• (241) As explained in Section 1.5 of the Regulation, the Commission decided to apply Article 18 of the basic Regulation for the determination of dumping, in accordance with Article 17(4), second paragraph of the basic Regulation, and to grant individual examination to Pizhou Jianghsan Wood Co., Ltd, as the only company that provided a proper and timely questionnaire response that could be verified in accordance with Article 16(1) of the basic Regulation.

• (242) To determine the dumping margin for Jiangshan Wood, the Commission compared the weighted average normal value of each type of the like product with the weighted average export price of the corresponding type of the product concerned, in accordance with Article 2(11) and (12) of the basic Regulation. On this basis, the provisional weighted average dumping margin expressed as a percentage of the CIF Union frontier price, duty unpaid, is as follows:

Company	Provisional dumping margin (%)
Pizhou Jiangshan Wood Co., Ltd	25,1

• (243) For all other exporting producers, the Commission established the dumping margin on basis of the facts available, in accordance with Article 18 of the basic Regulation.

• (244) To this end, the Commission based the dumping margin on a comparison of the weighted average normal value as established for Jiangshan Wood with exports prices as reported in Eurostat. In the Commission’s view, those export statistics represented a reasonable proxy for the dumping behaviour of the non-cooperating exporting producers. This was confirmed by analysing the average export prices as reported by the exporting producers that came forward in the sampling exercise, which were in the same range as the Eurostat data.

• (245) The provisional dumping margins, expressed as a percentage of the CIF Union frontier price, duty unpaid, are as follows:

Company	Provisional dumping margin (%)
Pizhou Jiangshan Wood Co., Ltd	25,1
All other imports originating in the PRC	62,4

4. INJURY

4.1.   Definition of the Union industry and Union production

• (246) The like product was manufactured by twenty-six producers in the Union during the investigation period. They constitute the ‘Union industry’ within the meaning of Article 4(1) of the basic Regulation.

• (247) The total Union production during the investigation period was established at around 1 664 963 cubic meters (m³) or 1 082 031 tonnes. The Commission established the figure on the basis of all the available information concerning the Union industry, such as the complaint and the reply to the macro questionnaire by the European Panel Federation, the association of Union hardwood plywood producers. As indicated in recital (27) of the Regulation, the three sampled Union producers represented 28 % of the total Union production of the like product.

4.2.   Union consumption

• (248) The Commission established the Union consumption on the basis of EU sales and the imports from all countries taking place in that year based on (a) data submitted by the complainant concerning the Union industry’s sales of the like product to unrelated customers in the Union, as cross-checked with the sales volumes reported by the sampled Union producers; and (b) imports of the product under investigation from all third countries, as reported in Eurostat.

• (249) Union consumption developed as follows:

Table 2

Union consumption (m³)

	2021	2022	2023	Investigation period
Total Union consumption	3 737 311	3 411 779	2 536 966	2 600 550
Index	100	91	68	70
Source: Complaint, Union industry, Eurostat.	Source: Complaint, Union industry, Eurostat.	Source: Complaint, Union industry, Eurostat.	Source: Complaint, Union industry, Eurostat.	Source: Complaint, Union industry, Eurostat.

• (250) There was a significant reduction (– 30 %) in the total Union consumption of the product under investigation during the period considered. Between 2021 and 2022, the downward trend was moderate. The decrease of consumption accelerated in 2023 but recovered slightly in the investigation period. The Commission found that the decrease in Union consumption was the result of several factors: the imposition of economic sanctions on imports of wood products, including the product under investigation, originating in Russia and Belarus in July 2022 following Russia’s full-scale war of aggression against Ukraine, stockpiling by importers at the beginning of the period considered following the imposition of anti-dumping measures on imports of birch plywood originating in Russia in 2021, and the end of the economic rebound that followed the COVID-19 pandemic. The imposition of economic sanctions led to the exclusion from the Union market of 1,4 million m³ of hardwood plywood originating in Russia ¹²⁴ and Belarus ¹²⁵. The market received a supply shock and contracted because neither the Union industry nor other producing countries could fully replace Russian and Belarusian hardwood plywood. Birch and poplar trees reach the right age for logging after 10 to 40 years. It therefore takes a couple of years to increase the number of trees destined for hardwood production by shifting logs from paper and timber production to plywood (see recital (326)).

4.3.   Imports from the country concerned

4.3.1.   Volume and market share of the imports from the country concerned

• (251) The Commission established the volume of imports on the basis of Eurostat data. The market share of the imports was established on the basis of the comparison of the volume of imports with the Union consumption.

• (252) The Commission found distorted data in the reported statistics at the level of the supplementary unit (m³ in this case). For comparison purposes, the Commission, therefore, decided to convert the reported weight (tonnes), a more reliable and stable set of data, into m³.

• (253) The conversion was based on the density, calculated based on weight divided by the supplementary unit, of the panels. If the density was within a predefined density range provided for every HS code, the reported supplementary unit was accepted. If it was outside of the range, the reported density was replaced by the average density of that HS code.

• (254) Imports into the Union from the country concerned developed as follows:

Table 3

Import quantity and market share

	2021	2022	2023	Investigation period
Quantity of imports from the country concerned (m3)	683 984	900 104	750 083	794 899
Index	100	132	110	116
Market share (%)	18	26	30	31
Index (2021=100 %)	100	144	162	167
Source: Eurostat.	Source: Eurostat.	Source: Eurostat.	Source: Eurostat.	Source: Eurostat.

• (255) Imports of hardwood plywood from China increased overall by 16 % during the period considered. They peaked in the year 2022 with an increase of 32 % compared to the volume of imports in 2021. After a drop in import volume in 2023, the amount of hardwood plywood imported increased again in the investigation period.

• (256) One of the reasons for the sharp increase of imports from China was the substitution in the Union market of hardwood plywood originating in Russia and Belarus by Chinese hardwood plywood. The untapped stocks of hardwood plywood built up in China as a result of the slowdown of the Chinese construction industry were quickly mobilized to fill in the gap left by Russian and Belarusian hardwood plywood in the Union market, as explained in recital (250) above.

• (257) The market share of Chinese imports on the Union market developed in accordance with the shift in trade flows and decrease in consumption described above. In this context, the increase of Chinese imports led to a rise of their market share by 67 percentage points during the period considered.

4.3.2.   Prices of the imports from the country concerned and price undercutting

• (258) The Commission established the prices of imports on the basis of EUR/m³ Eurostat statistics, as described in recitals (251) to (253).

• (259) The weighted average price of imports into the Union from the country concerned developed as follows:

Table 4

Import prices (EUR/m³)

	2021	2022	2023	Investigation period
China	373	529	438	418
Index	100	142	118	112
Source: Eurostat.	Source: Eurostat.	Source: Eurostat.	Source: Eurostat.	Source: Eurostat.