Commission Implementing Regulation (EU) 2026/270 of 4 February 2026 imposing provisional anti-dumping duties on imports of 1,4-Butanediol originating in the People’s Republic of China, the Kingdom of Saudi Arabia and the United States of America

• (282) Table 2 shows a contrast between the developments of the captive market, which fell by 38 % over the period considered and the free market which increased by 15%. Taking into account the finding at recital 273, the important total Union consumption in 2023 and the investigation period was supplied less from the Union production and more from dumped imports. These developments are further analysed under in the ‘injury’ and ‘causation’ sections.

4.4.   Imports from the countries concerned

4.4.1.   Cumulative assessment of the effects of imports from the countries concerned

• (283) The Commission examined whether imports of BDO originating in the countries concerned should be assessed cumulatively, in accordance with Article 3(4) of the basic Regulation.

• (284) As established in section 3, the margin of dumping established in relation to the imports from China, Saudi Arabia and the USA was above the de minimis threshold laid down in Article 9(3) of the basic Regulation. The volume of imports from each of the countries concerned was not negligible within the meaning of Article 5(7) of the basic Regulation. As per Table 3, market shares (of the total Union market) in the investigation period were around 7 %, 11 % and 7 %, respectively.

• (285) In respect of the conditions of competition, LCN argued that BDO imports from the USA are not subject to the same conditions of competition as imports from Saudi Arabia and China. LCN pointed out that imports from the USA consisted exclusively of intra-company deliveries within the Lyondell Basell and BASF groups. It further stated that whilst LCN deliveries from the USA were traded on the Union market, BASF’s imports were to be used by the company to produce downstream products.

• (286) The Commission does not dispute the facts concerning US imports as commented by LCN, but does not agree that different conditions of competition apply to US imports as compared to imports from Saudi Arabia and China. In fact, imports from all three countries were used by Union producers to produce downstream products and/or traded on the free market, and the frequency varied through the period considered. The same was true of the production of the Union producers. This like product was either used captively or sold to industrial users (on similar contractual terms as those of imports) on the Union market. The imports from the countries concerned were all in competition with each other and the Union production, because they were made using similar contract price conditions using ICIS [^ntr100-L_202600270EN.000101-E0100] indices as a benchmark. The imports all consisted of BDO sharing the same basic characteristics meaning that they were fully interchangeable. In addition, they were often competing for the same use, namely of supplying BDO for the captive Union demand and/or free market demand, including the reselling of imported BDO.

• (287) Comments on cumulation of imports as regards the Saudi Arabia were made by Sipchem, INEOS and Will and Co. In respect of the conditions of competition, Sipchem argued that BDO imports from Saudi Arabia are not subject to the same conditions of competition as imports from USA and China. Sipchem pointed out that Sipchem’s sales to INEOS make clear that the market behaviour of Sipchem is different from that of Chinese BDO exporters, which make many opportunistic spot sales, and USA BDO exporters, who mostly sell to related entities in the Union for downstream use to complement their EU BDO production. In addition, Will and Co argued that imports from Saudi Arabia follow the prices set by China in BDO, and because of this should not be cumulated. INEOS disagreed with the comments of Sipchem and Will and Co pointing out that similar pricing arrangements existed for imports from Saudi Arabia as existed for other imports and Union industry sales in general during the period considered.

• (288) Again, the Commission did not agree that different conditions of competition apply to Saudi Arabian imports as compared to imports from the USA and China, and that there were different production methods, cost of production and selling prices to the Union from the countries considered. Imports from all three countries were used captively by Union producers and/or traded on the free market, and the frequency varied through the investigation period. The same was true of the production of the Union producers. This like product was either used in downstream products or sold to industrial users (on similar terms as those of imports) on the Union market. The imports from the countries concerned were all in competition with each other because they were made using similar contract price conditions using ICIS indices as a benchmark. In addition, the product imported shared the same basic characteristics meaning that they were fully interchangeable.

• (289) Therefore, the conditions of competition between the dumped imports from the countries concerned and the like product were similar. More specifically, the imported BDO competed with each other and with the BDO produced in the Union, because they are sold through the same sales channels, had the same uses and were ultimately sold to the same customers.

• (290) As a result, the criteria set out in Article 3(4) of the basic Regulation were met and imports from the three countries concerned were examined cumulatively for the purposes of the injury determination.

4.4.2.   Volume and market share of the imports from the countries concerned

• (291) The Commission established the volume of imports on the basis of Union imports statistics. The market share of the imports was established on the basis of Union imports statistics compared total Union consumption as per Table 2.

• (292) Imports into the Union from the countries concerned developed as follows:

Table 3

Import quantity and market share

	2021	2022	2023	Investigation period
CHINA	CHINA	CHINA	CHINA	CHINA
Quantity of imports from China (tonnes)	10 220	17 415	36 725	23 776
Market share China (%)	2	5	13	7
SAUDI ARABIA	SAUDI ARABIA	SAUDI ARABIA	SAUDI ARABIA	SAUDI ARABIA
Quantity of imports from Saudi Arabia (tonnes)	26 183	35 928	28 474	39 821
Market share Saudi Arabia (%)	6	11	10	11
USA	USA	USA	USA	USA
Quantity of imports from the USA (tonnes)	12 415	15 719	39 283	25 449
Market share USA (%)	3	5	14	7
TOTAL COUNTRIES CONCERNED	TOTAL COUNTRIES CONCERNED	TOTAL COUNTRIES CONCERNED	TOTAL COUNTRIES CONCERNED	TOTAL COUNTRIES CONCERNED
Quantity of imports from the countries concerned (tonnes)	48 818	69 062	104 483	89 047
Index	100	141	214	182
Market share countries concerned (%)	12	21	37	26
Index	100	186	318	223
Source: Eurostat for imports quantities, and market shares is comparing imports quantities against Total Union consumption as per Table 2.	Source: Eurostat for imports quantities, and market shares is comparing imports quantities against Total Union consumption as per Table 2.	Source: Eurostat for imports quantities, and market shares is comparing imports quantities against Total Union consumption as per Table 2.	Source: Eurostat for imports quantities, and market shares is comparing imports quantities against Total Union consumption as per Table 2.	Source: Eurostat for imports quantities, and market shares is comparing imports quantities against Total Union consumption as per Table 2.

• (293) Imports from the countries concerned increased over the period considered, from about 48 800 tonnes in 2021 to about 89 000 tonnes in the IP, an increase of 82 %. Imports reduced in the IP when compared to 2023, but this decline is partly attributed to the Red Sea Crisis [^ntr101-L_202600270EN.000101-E0101] affecting the ability to import BDO to the Union. In addition, LCN stated that the imports from China in 2024 would have fallen due to BASF’s strategic decision to divest from its joint venture in China in Q4 2023 thereby reducing total imports from China.

• (294) Market shares of countries concerned followed a similar trend to imports, in the IP the market share reduced compared to 2023 from 37 % to 26 %. However, across the entire period considered, the market share more than doubled, from 12 % in 2021 to 26 % in the IP, a 14 percentage points increase.

4.5.   Prices of the imports from the countries concerned and price undercutting and price depression

• (295) The Commission established the prices of imports on the basis of Eurostat data. Price undercutting of the imports was established on the basis of information from the sampled cooperating producers from China, cooperating exporting producers from Saudi Arabia and the USA and the sampled Union producers.

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

Table 4

Import prices (EUR/ tonne)

	2021	2022	2023	Investigation period
CHINA	CHINA	CHINA	CHINA	CHINA
Average price from China dumped imports	3 007	3 230	1 590	1 351
Index	100	107	53	45
SAUDI ARABIA	SAUDI ARABIA	SAUDI ARABIA	SAUDI ARABIA	SAUDI ARABIA
Average price from Saudi Arabia dumped imports	2 390	3 652	1 611	1 188
Index	100	153	67	50
USA	USA	USA	USA	USA
Average price from US dumped imports	2 130	4 477	2 477	1 211
Index	100	210	116	57
COUNTRIES CONCERNED	COUNTRIES CONCERNED	COUNTRIES CONCERNED	COUNTRIES CONCERNED	COUNTRIES CONCERNED
Average price from Countries Concerned dumped imports	2 453	3 733	1 929	1 238
Index	100	152	79	50
Source: Eurostat data.	Source: Eurostat data.	Source: Eurostat data.	Source: Eurostat data.	Source: Eurostat data.

• (297) The average price of imports into the Union from the countries concerned first increased in 2022 by 52 % to about 3 700 EUR/tonne and then considerably reduced in 2023 to about 1 900 EUR/tonne. Overall, the average price reduced significantly during the period considered by 50 %, from about 2 400 EUR/tonne in 2021 to about 1 200 EUR/tonne in the IP.

• (298) The fluctuation of price was mostly influenced by the development of raw material costs and energy prices, in combination with substantial capacity investments, increased imports to the Union and the spare capacity from the countries concerned during the period considered. In addition, import sales were subject to contracts linked to ICIS benchmark prices.

• (299) The Commission determined the price undercutting during the investigation period by comparing:

• (a) the weighted average sales prices per product type of the sampled Union producers charged to unrelated customers on the Union market, adjusted to an ex-works level; and

• (b) the corresponding weighted average prices per product type of the imports from the sampled cooperating producers from China and cooperating producers from Saudi Arabia and the USA to the first independent customer on the Union market, established on a Cost, insurance, freight (CIF) basis, with appropriate adjustments for customs duties and post-importation costs.

• (300) The price comparison was made on a type-by-type basis for transactions at the same level of trade, duly adjusted where necessary, and after deduction of rebates and discounts. The result of the comparison was expressed as a percentage of the sampled Union producers’ theoretical turnover during the investigation period. It showed a weighted average undercutting margin of 6,9 % by the countries concerned on the Union market. There was no undercutting for the sampled Chinese exporting producers. However, the Commission refers to other price effects (depression) at section 4.6.3.1 of this Regulation (see for example recitals 331 to 334). In addition, it was clear that prices of both imports and the Union industry were on a similar trend as the investigation established that contracts to industrial users used ICIS prices as a benchmark as found at recital 331.

• (301) LCN argued that imports from the USA did not undercut or cause injury to the Union industry, because they were imported by both LCN and BASF and when sold (or used captively) on the Union market, they would be sold (or consumed) at the same prices (or costs) as Union production sold (or consumed) on the Union market. However, as found at section 4.6.3.1 of this Regulation, the sales prices of the Union were significantly depressed and this price depression was in fact a major cause of injury. In addition, the imports from the USA did, on average, undercut the sales prices of the Union industry. Therefore, the undercutting of the US imports was a significant factor in the injury investigation.

• (302) Sipchem and Will and Co. argued that imports from Saudi Arabia did not undercut or cause injury to the Union industry, because they helped the Union industry to maintain its position on the Union market. However, as found at section 4.6.3.1 of this Regulation, the sales prices of the Union were seriously depressed and this price depression was in fact a major cause of injury. In addition, the imports from the USA did, on average, undercut the sales prices of the Union industry. Therefore, the undercutting of the Saudi imports was a significant factor in the injury investigation.

• (303) Sipchem also provided data on its post investigation period (2025) exports to an unrelated Union customer. Sipchem claimed that the volume and prices of these exports supported its view that the sales in the investigation period should be excluded from the export price calculations for the calculation of dumping and injury. This was because Sipchem was a price taker on the Union market. However, as the conditions for cumulation are met in respect of imports from Saudi Arabia, it would not be appropriate or justified to exclude sales from export price calculations. It also follows from the ‘conclusion on injury’ below that imports from Saudi Arabia played a role in the injury suffered by the Union industry. Furthermore, data in the post investigation period should not be taken into account in the analysis of dumping and injury. The claim was therefore rejected.

4.6.   Economic situation of the Union industry

4.6.1.   General remarks

• (304) In accordance with Article 3(5) of the basic Regulation, the examination of the impact of the dumped imports on the Union industry included an evaluation of all economic indicators having a bearing on the state of the Union industry during the period considered.

• (305) As mentioned in recital 33, sampling was used for the determination of possible injury suffered by the Union industry.

• (306) For the injury determination, the Commission distinguished between macroeconomic and microeconomic injury indicators. The Commission evaluated the macroeconomic indicators on the basis of data contained in the questionnaire replies, from all four Union producers. The Commission evaluated the microeconomic indicators on the basis of data contained in the questionnaire replies from the three sampled Union producers. Both sets of data were found to be representative of the economic situation of the Union industry.

• (307) The macroeconomic indicators are: production, production capacity, capacity utilisation, captive use, sales volume, market share, growth, employment, productivity and magnitude of the dumping margin.

• (308) The microeconomic indicators are: average unit prices, unit costs, labour costs, inventories, profitability, cash flow, investments, return on investments, and ability to raise capital.

4.6.2.   Macroeconomic indicators

4.6.2.1.   Production, production capacity and capacity utilisation

• (309) The total Union production, production capacity and capacity utilisation developed over the period considered as follows:

Table 5

Production, production capacity, capacity utilisation and share of captive use

	2021	2022	2023	Investigation period
Production quantity (tonnes)	345 847	210 509	112 400	189 714
Index	100	61	32	55
Production capacity (tonnes)	467 198	465 434	470 271	470 271
Index	100	100	101	101
Capacity utilisation (%)	74	45	24	40
Index	100	61	32	54
Source: Producer questionnaire replies.	Source: Producer questionnaire replies.	Source: Producer questionnaire replies.	Source: Producer questionnaire replies.	Source: Producer questionnaire replies.

• (310) The Union production reduced significantly during the period considered. First reducing by 39 % in 2022 when compared to 2021, and then dropping again by 68 % in 2023 when compared to 2021 production quantities. Production quantities recovered in the IP when compared to 2023, but overall it reduced in the period considered, being 45 % lower in the IP than of 2021. This increase of production in the IP relative to 2023 was observed mainly due to the need to produce BDO of Union producers for captive use and sales, in order to compensate for a temporary Union limitation to source BDO imports as per mentioned in recital 293 and to maintain existing client commitments and reputation in the Union. In addition, production levels could only be reduced to a certain minimum level by each Union producer, due to fixed and other costs from operating the facilities, even if the Union producers wished to reduce volumes further due to the lower sales price and volume. This decline of sales volume and price resulted from the competition of dumped imports, the prices of imports from the period considered were significantly lower than the Union producers’ cost of production in 2023 and the IP.

• (311) Production capacity remained stable during the period considered at around 470 000 tonnes.

• (312) Therefore, capacity utilisation followed very similar trends to production volume first reducing in 2022 to 45 % and then again in 2023 to 24 % of total utilisation, and increasing in the IP when compared to 2023. In the period considered capacity utilisation declined by 34 percentage points, from 74 % in 2021 to 40 % in the IP.

• (313) The reduction of production was due to production cost in the Union becoming uncompetitive when compared to the very low price of dumped imports.

4.6.2.2.   Sales quantity and market share

• (314) The Union industry’s sales quantity and market share developed over the period considered as follows:

Table 6

Sales quantity, captive use and market shares of the Union Industry

	2021	2022	2023	Investigation period
A. Production quantity sold on the Union market (tonnes)	117 513	67 577	58 979	107 252
Index	100	58	50	91
B. Captive use (tonnes) (from Table 2)	264 489	183 604	134 693	163 036
Index	100	69	51	62
A+B Production sold plus captive use (tonnes)	382 002	251 180	193 672	270 288
Index	100	66	51	71
Production sold as a % of the free market	74	49	39	58
Index	100	66	53	79
Captive use as a % of total Union consumption	62	57	47	47
Index	100	91	76	76
Production sold plus captive use as a % of total Union consumption	90	78	68	78
Index	100	86	75	86
Source: Producer questionnaires replies and Eurostat data.	Source: Producer questionnaires replies and Eurostat data.	Source: Producer questionnaires replies and Eurostat data.	Source: Producer questionnaires replies and Eurostat data.	Source: Producer questionnaires replies and Eurostat data.

• (315) The investigation has shown, as recital 273 explains, that when market conditions deteriorated, captive use from own production was replaced by imports because the latter caused significant price depression and were priced below the Union industry’s cost of production. Therefore, given the market conditions created by dumped imports it was economically not viable for the Union producers to keep producing at such levels, not even for captive use as shown in Table 6. As captive use was replaced by imports, the Commission examined market shares in this investigation both as a percentage of the total market and as a percentage of free and captive markets separately. The Commission analysed both production sold on free market and production sold plus captive use as a percentage of the total market. This latter indicator showed the overall market position of the Union industry on the Union market in the period considered.

• (316) The quantity of Union industry production sold on the free market significantly declined in 2022 and then again in 2023 dropping to 50 % of 2021, but then recovered to a certain extent in the IP while still remaining below the 2021 level. Throughout the period analysed, Union industry sales volume in the Union decreased by 9 % during the period considered, from about 117 500 tonnes to around 107 000 tonnes.

• (317) The quantity of Union industry production sold plus captive use also significantly declined in 2022 and then again in 2023 reaching 49 % of 2021, but then recovered in the IP to a certain extent while remaining below the 2021 level. Throughout the period analysed, Union industry sales volume plus captive use in the Union decreased by 14 % during the period considered, from about 382 000 tonnes to 270 000 tonnes.

• (318) The Union Industry production sold market share of the Union free market reduced in the period considered by 16 percentage points. First reducing in 2022 by 25 percentage points compared to 2021, and in 2023 by 35 percentage points compared to 2021. It then increased 19 percentage points from 39 % in 2023 to 58 % in the IP, this increase was mainly due to a higher degree of production and sales in the IP when compared to 2023 as explained in recital 310 combined with a decline in total BDO consumption in the Union. The Union industry captive market share of total consumption declined by 15 percentage points in the period considered. First reducing in 2022 by 5 percentage points compared to 2021, and then by 15 percentage points in 2023 when compared to 2021, remaining at this level until the IP.

• (319) The Commission then considered both the Union Industry’s production sold and captive use (cumulatively) as a percentage of total consumption and found that overall conclusion in respect of market share was most clearly evidenced since it included both economic activities of the Union industry, being the sale in the free market of producers and the captive use of BDO. Under this metric, the market share of the Union industry reduced by 12 percentage points in 2022 and 22 percentage points 2023, when compared to 2021. On this basis, the Union industry’s market share fell by 12 percentage points in the period considered, decreasing from 90 % in 2021 to 78 % in the IP.

• (320) In a period of shrinking market prices Union production has been substantially replaced by imports mainly from the countries concerned. For this reason, the Commission considered that only by examining free market sales together with captive use was it possible to evaluate the real impact that increasing imports had on the Union market.

4.6.2.3.   Growth

• (321) Bearing in mind the overall market share decline depicted at recital 318, the Union industry has shown no growth over the period considered, but in fact had a worse position on the Union market in the investigation period than it had in 2021.

4.6.2.4.   Employment and productivity

• (322) Employment and productivity developed over the period considered as follows:

Table 7

Employment and productivity

	2021	2022	2023	Investigation period
Number of employees	508	499	507	505
Index	100	98	100	99
Productivity (tonnes/employee)	681	422	222	376
Index	100	62	33	55
Source: Producer questionnaires replies.	Source: Producer questionnaires replies.	Source: Producer questionnaires replies.	Source: Producer questionnaires replies.	Source: Producer questionnaires replies.

• (323) Numbers of employees remained stable during the period considered, reducing by 1 % overall. The Union producers maintained a minimum number of employees to be able to continue to run the production facilities in an efficient and safe manner. The number of employees did not vary according to the level of production.

• (324) However, a significant reduction of production combined with a stable number of employees meant that the productivity of the Union producers reduced significantly in the period considered by 45 %, from 681 tonnes per employee in 2021 to 376 tonnes per employee in the IP.

4.6.2.5.   Magnitude of the dumping margin and recovery from past dumping

• (325) All dumping margins were significantly above the de minimis level. The impact of the magnitude of the actual margins of dumping on the Union industry was substantial, given the volume and prices of imports from the countries concerned.

• (326) This is the first anti-dumping investigation regarding the product concerned. Therefore, no data were available to assess the effects of possible past dumping.

4.6.3.   Microeconomic indicators

• (327) The microeconomic indicators of the Union industry were sourced from the verified questionnaire responses of the three sampled Union producers. However, depending on the degree of vertical integration, the microeconomic indicators were largely sourced from only two producers. As publication of the actual figures would mean that sensitive data of the relevant Union industry producers would be revealed, the Commission has used ranges and indices in this part of the injury assessment to protect confidentiality.

4.6.3.1.   Prices and factors affecting prices

• (328) The weighted average unit sales prices of the sampled Union producers to unrelated customers in the Union developed over the period considered as follows:

Table 8

Sales prices and cost of production in the Union

	2021	2022	2023	Investigation period
Average unit sales price on the free market (EUR/tonne)	[2 100 –2 800 ]	[3 000 –3 900 ]	[1 400 –1 900 ]	[1 000 –1 400 ]
Index	100	136	67	48
Unit cost of production sold (EUR/tonne)	[1 600 –2 000 ]	[2 800 –3 400 ]	[2 600 –3 100 ]	[1 900 –2 400 ]
Index	100	171	156	121
Source: Sampled Union producers’ questionnaires replies.	Source: Sampled Union producers’ questionnaires replies.	Source: Sampled Union producers’ questionnaires replies.	Source: Sampled Union producers’ questionnaires replies.	Source: Sampled Union producers’ questionnaires replies.

• (329) Sales prices on the free market of the Union producers first increased in 2022, by 36 % when compared to 2021. However, the sales price then reduced considerably in 2023, from 3 000–3 900 EUR/tonne in 2022 to 1 400–1 800 in 2023. During the period considered sales prices of the Union producers reduced considerably by 52 %. The Union producers were able to pass higher production costs in 2022, however they were unable to do so in 2023 and IP, due to the increased competition in the Union from a much higher volume of dumped imports and at increasingly lower prices.

• (330) Sales prices on the Union BDO market are dominated by framework contracts which set agreed quantities and typically prices were regularly updated on a monthly basis, based on ICIS data. The monthly ICIS data was available for both the Chinese and Union markets. During the period considered, sale prices in the Union were influenced by: (i) the increasing competition with dumped imports, both in terms of increased volumes and of lower prices; (ii) the continuedly lowering of BDO ICIS prices. ICIS prices in the Union were in turn influenced by the prices of dumped imports of the countries concerned. In particular in the case of China, it is observed a substantial increase of new BDO capacity of production and spare capacity in the country, for which installed capacity was estimated by Union producers to have reached at least 9 times the Union in the IP and to be by far the biggest installed capacity globally. This significant installed capacity and spare capacity allowed China to be a reference for global BDO prices and influence global BDO prices, such as in the Union, resulting in a strong correlation between China based BDO ICIS and the BDO ICIS price in Europe or the Union sales prices. In addition, Union sales prices were also directly influenced by China based ICIS BDO prices, as it was on occasions used directly in the sales contracts for major customers in the Union.

• (331) Therefore, dumped imports and ICIS prices of the Chinese market were the price setter on the Union market, and the prices of both the Union industry and imports from all other countries had to compete with this price.

• (332) The cost of production sold of the Union producers increased considerably in 2022 by 71 % when compared to 2021, mainly due to an increase of raw material costs (for example, natural gas, naphtha, hydrogen or steam) and electricity prices. The cost of production then declined from [2 800–3 400] EUR per tonne in 2022 to [2 600–3 100] EUR per tonne in 2023 but remained 58 % higher than 2021. In the IP, costs of production reduced significantly compared to 2023 reaching [1 900–2 400] EUR per tonne. This change was mainly from a reduction of raw material costs and electricity prices. Overall, however, the cost of production increased by 21 % in the period considered, as in addition to the development of raw material and energy prices, the Union producers experienced higher fixed costs per unit due to the significant lower production levels.

• (333) Therefore, Union producers’ cost of production was higher than the sale price of the Union producers for 2023 and the IP. Union producers experienced price depression from the lowering of sales prices to the level of the dumped imports, at the expense of selling the product under investigation at below production costs especially during 2023 and the IP.

• (334) The Commission analysed the sales prices and costs of the Union industry (as shown in Table 8), together with its profitability (Table 11) and the import prices and quantities of the cumulated imports (Tables 2 and 3). It was clear that a very serious depression of prices took place on the Union market in 2023 and the investigation period. In 2022 the higher costs of the Union industry (as compared to 2021) were passed onto customers, but in 2023 and the IP it was no longer possible to recover costs due to the price pressure of the increasing volumes of dumped imports at low and decreasing prices.

4.6.3.2.   Labour costs

• (335) The average labour costs of the sampled Union producers developed over the period considered as follows:

Table 9

Average labour costs per employee

	2021	2022	2023	Investigation period
Average labour costs per employee (EUR)	[100 000 –120 000 ]	[100 000 –120 000 ]	[100 000 –120 000 ]	[100 000 –120 000 ]
Index	100	103	102	102
Source: Sampled producer questionnaires replies.	Source: Sampled producer questionnaires replies.	Source: Sampled producer questionnaires replies.	Source: Sampled producer questionnaires replies.	Source: Sampled producer questionnaires replies.

• (336) Average cost per employee increased slightly during the period considered, by 2 %, as numbers of employees remained stable to be able to keep production facilities on and salaries and other employee cost increased slightly during the period considered from about EUR 100 000 to EUR 120 000.

• (337) Labour costs were around (7–15 %) of the total cost of production reported in Table 8 during the IP.

4.6.3.3.   Inventories

• (338) Stock levels of the sampled Union producers developed over the period considered as follows:

Table 10

Stocks

	2021	2022	2023	Investigation period
Closing stock (tonnes)	[7 000 –10 000 ]	[9 000 –13 000 ]	[5 000 –9 000 ]	[11 000 –15 000 ]
Index	100	130	73	150
Closing stock as a percentage of production (%)	3	5	6	7
Source: Sampled Union producer questionnaires replies.	Source: Sampled Union producer questionnaires replies.	Source: Sampled Union producer questionnaires replies.	Source: Sampled Union producer questionnaires replies.	Source: Sampled Union producer questionnaires replies.

• (339) Closing stock in tonnes increased by 50 % during the period considered, from about 7 000–10 000 tonnes in 2021 to 11 000–15 000 tonnes in the IP. Overall, closing stock increased over the period considered when compared to production volumes increasing from 3 % in 2021 to 6 % in 2023, and then reaching 7 % in the IP.

• (340) However, BDO is a chemical which is costly to stock safely, and that has to be stored in special tanks which are temperature controlled. Therefore, the Union industry was more likely to control production volumes rather than increase/reduce stocks levels which are limited in the Union. For that reason, the Commission did not consider that the increase in closing stocks was an important indicator of injury.

4.6.3.4.   Profitability, cash flow, investments, return on investments and ability to raise capital

• (341) Profitability, cash flow, investments and return on investments of the sampled Union producers developed over the period considered as follows:

Table 11

Profitability, cash flow, investments and return on investments

	2021	2022	2023	Investigation period
Profitability of sales in the Union to unrelated customers (% of sales turnover)	[20 to 40 ]	[10 to 25 ]	[–70 to –30 ]	[–90 to –50 ]
Index	100	54	– 178	– 198
Cash flow (EUR) (000)	[100 000 to 200 000 ]	[40 000 to 120 000 ]	[–40 000 to –10 000 ]	[– 100 000 to –50 000 ]
Index	100	46	–19	–58
Investments (EUR) (000)	[30 000 to 60 0000]	[50 000 to 90 000 ]	[10 000 to 40 000 ]	[50 000 to 90 000 ]
Index	100	132	50	93
Return on investments (%)	[20 to 40 ]	[10 to 25 ]	[–30 to –10 ]	[–50 to –20 ]
Index	100	58	–84	– 122
Source: Sampled producer questionnaires replies.	Source: Sampled producer questionnaires replies.	Source: Sampled producer questionnaires replies.	Source: Sampled producer questionnaires replies.	Source: Sampled producer questionnaires replies.

• (342) The Commission established the profitability of the sampled Union producers by expressing the pre-tax net profit of the sales of the like product to unrelated customers in the Union, as a percentage of the turnover of those sales. In 2021 and 2022 the Union producers managed to achieve profitability, as the Union producers faced less competition from dumped imports and was able to pass higher production costs to its customers. However, in 2023 profitability was at (– 70 % to – 30 %) and then reached a low (– 90 % to – 50 %) of during the IP. Despite a lower production cost than 2022 for the Union producers and a stabilization of electricity and raw material costs in the Union during 2023 and the IP, the Union sales prices continued to reduce further due to the price pressure of the increasing volumes of dumped imports, with significantly lower prices than 2022 resulting in price depression. To recall, average prices of dumped imports from the countries concerned fell by 50 % over the period considered as illustrated in Table 4 and explained in recital 297. Union producer’s sales prices were thereby depressed and Union producers could only sell the product under investigation at a deep negative profit, as the sales price in the Union plummeted below cost of production, in 2023 and the IP.

• (343) Cash flow followed lower sales levels and the negative profitability of 2023 and IP, resulting in cash flow reaching about EUR (– 100 000 to – 50 000) million in the IP from a positive cash flow of EUR (100 000 to 200 000) million in 2021.

• (344) Investments fluctuated over the period considered. The Union industry explained that investment planning was carried out periodically (every 4–5 year) in a lump sum per producer. Therefore, during the period considered total investment varied significantly year per year, depending on the timing of the turnaround investments. Investments in the period considered mainly related to the minimum required investments to maintain the existing production levels in accordance with safety and environmental standards in force. Investments increased by 32 % in 2022, then reduced significantly to 50 % in 2023 when compared to 2021. In the IP investments were slightly lower than in 2011 at – 7 %.

• (345) The sampled Union producers’ return on investments is the profit in percentage of the net book value of investments and followed the same trend as profitability, with a positive return of investment in 2021 and in 2022. However, this was followed by substantial losses in 2023 and in the IP.

• (346) The sampled Union producers’ ability to raise capital was constrained in 2023 and the IP, due to substantial cash outflows from the deeply negative profitability, only minimum capex was invested to maintain minimum safe conditions to produce BDO and turn on the facilities. In addition, Union producers either extended turnaround plans or considered shutting down facilities due to the deep negative profitability explained above.

4.7.   Conclusion on injury

• (347) The investigation found that the Union industry suffered material injury as all performance injury indicators showed significant negative trends, especially in 2023 and the IP. The earlier years of the period considered (2021 and 2022) demonstrated what can be achieved by the Union Industry under more normal conditions of competition, even during periods of high raw material or energy costs. The Union producers however had to drastically cut production to minimum levels as production became uncompetitive due to the increasing quantities of dumped imports from the countries concerned in 2023 and the period considered. In 2023 and IP the price depression created a severe injurious situation, which did not allow the Union industry to set prices at levels to enable it to recover costs of production nor make any profit. The losses of the Union producers were between 30 % and 70 % on turnover in 2023 and between 50 % and 90 % in the investigation period as shown in Table 11.

• (348) The Union producers have only survived this period of high losses because profits were made in 2021 and 2022, and because the companies are part of large groups. Increasing dumped imports and at continuously lower prices, prevented adequate price increases and negatively affected production and sales quantities of BDO. This situation did not allow the Union producers to reduce their fixed costs of production which would be the case at more normal utilization levels nor to raise prices to a sustainable level. In fact, in 2023 and the investigation period the prices and costs of the Union producers were so disconnected, and losses of the Union producers were at such high levels, that the situation of the BDO industry became so serious as to represent a major threat to its existence in the short term. In 2023 import volumes from these countries increased by 51 % and prices fell by 48 % as compared to 2022 levels. In the investigation period, import volumes fell by 15 % but prices fell by a further 36% as compared to 2023 levels. These figures are shown in Tables 2 and 3.

• (349) The clear price depression caused by dumped imports into the Union is explained in recitals 330 to 333. This price depression and losses in 2023 and IP also resulted in serious injury in terms of other performance indicators such as cash flow and return on investment (as shown at Table 11) and the ability to raise capital. Despite keeping investments in order to meet safety and environmental requirements, in the IP the Union industry was clearly in a much worse situation, so that their ability to raise capital had reduced. The deterioration in the economic situation of the Union industry in 2023 and IP took place despite an 8 % rise in consumption of BDO in the Union from 2022.

• (350) Table 6 shows the development of market shares in this investigation. A comparison of Union industry free market sales plus captive use as compared to total consumption gives the best indication of the Union industry’s position on the total market. Under this metric the Union industry market share declined over the period considered. But in the IP, the market share partly recovered as the Union industry increased production due to a reduced import quantity due to the Red Sea Crisis. In the period from 2022 to the investigation period the Union industry was protecting existing sales contracts, reputation and position on the Union market. However, this increase in production and sales came with the consequences of severe losses due to price depression forcing the Union industry to sell at loss as explained above.

• (351) All Union producers increased imports of BDO in order to be able to keep supplying key customers and to meet their captive needs, due to the substantial production reductions in the period considered. The practice of replacing production with imports also took place in 2022 when raw material and energy costs hiked, as shown by the production costs in Table 8. However, BDO sales prices were not as low in 2022 and a big surge in dumped imports took place in 2023. This is why material injury occurred from 2023, as demonstrated by the very injurious performance indicators for 2023 and the IP.

• (352) Although the injury in this investigation was quite evident in price and performance indicators, the Union industry also suffered a significant decline and injury in volume indicators, namely production volume, capacity utilisation, productivity, captive use and sales on the Union market all significantly declined over the period considered.

• (353) The indicators for employment, labour costs and capacity remained stable over the period considered showing the industry’s readiness for an upturn in market conditions. The indicator of inventories was not considered determinant in the injury assessment as explained at recital 344.

• (354) On the basis of the above, the Commission concluded at this stage that the Union industry suffered material injury within the meaning of Article 3(5) of the basic Regulation.

5. CAUSATION

• (355) In accordance with Article 3(6) of the basic Regulation, the Commission examined whether the dumped imports from the countries concerned caused material injury to the Union industry. In accordance with Article 3(7) of the basic Regulation, the Commission also examined whether other known factors could at the same time have injured the Union industry. The Commission ensured that any possible injury caused by factors other than the dumped imports from the countries concerned was not attributed to the dumped imports. These factors are: imports from third countries, the export performance of the Union industry, the impact of consumption, captive use, imports by the Union industry and increases in raw material and energy costs.

5.1.   Effects of the dumped imports

• (356) As shown in Table 3, the volume of dumped imports from the countries concerned increased from around 49 000 tonnes in 2018 to around 89 000 tonnes in the investigation period, an increase of 82 %. In terms of market share (of the total market), the increase over the same period was from 12 % to 26 %, an increase of 123 %. Bearing in mind that the conclusion on injury found that material injury took place in 2023 and the investigation period, the Commission also analysed the development of imports in these two years, from 2022 to the investigation period imports from the countries concerned increased by around 20 000 tonnes, an increase of 29 %. In terms of market share (of the total market), the increase from 2022 to the investigation period was around 4 percentage points or around 20 %.

• (357) From 2021 to the investigation period the Union industry sales quantity on the free market plus captive use decreased by 29 %, as shown in Table 6. In terms of overall market share the Union industry these were lower in 2023 and IP, reducing to around 78 % and 68 % compared to 90 % in the IP.

• (358) As explained in recitals 347 and 349, imports from the countries concerned caused price depression for the Union industry, which accelerated in 2023 and the investigation period. In this period the Union producers were no longer able to adjust their prices in a way that would allow them to cover their costs and significant losses in the IP ensued. This grave and unsustainable situation existed in both 2023 and the IP.

• (359) In addition, a price undercutting analysis was performed for the investigation period on a type-by-type basis. This demonstrated that competition between the Union industry and imports from the countries concerned was strong.

• (360) Sale prices in the Union were influenced by the increased competition with dumped imports, both in terms of increased dumped volumes and of lower prices. This was possible because of the nature of the BDO market whereby ICIS prices for BDO were used as a benchmark in the majority of sales contracts. Chinese ICIS is a reference for global BDO prices and influenced global BDO prices such as in the Union, as explained in recital 330. In addition, imports to the US market had become severely reduced as a result of increased import duties under various US legislation changes. Imports to the Union increased from Saudi Arabia, due to the restricted US market access and due to the penetration of Chinese imports in other traditional Saudi export markets (such as Asia).

• (361) Finally, as explained above, supply problems for the exporting producers temporarily lessened the pressure on the Union industry in the investigation period. This allowed the Union industry to increase production and sales quantities, but such sales were still highly unprofitable due to the price pressure from imports.

• (362) Therefore, the Union industry was forced into a situation of trying to maintain its position on the Union free and captive markets by lowering prices to unsustainable levels and with heavy losses. The only viable alternative to this was to vacate the Union market and leave it to the dumped imports.

• (363) Based on the above, the Commission concluded that the dumped imports from the countries concerned caused material injury to the Union industry.

5.2.   Effects of other factors

5.2.1.   Imports from third countries

• (364) The quantity, average price and market share of imports from third countries developed over the period considered as follows. The market shares are as a percentage of the total Union market.

Table 12

Imports from third countries

		2021	2022	2023	Investigation period
Taiwan	Quantity (tonnes)	3 467	19 531	13 157	6 771
	Index	100	563	379	195
	Market share (%)	0,8	6,1	4,6	2,0
	Index	100	741	564	239
	Average price	3 252	3 712	1 823	1 274
	Index	100	114	56	39
Other third countries	Quantity (tonnes)	2 075	184	1 735	1 773
	Index	100	9	84	85
	Market share (%)	0,5	0,1	0,6	0,5
	Index	100	12	124	104
	Average price	2 763	4 307	1 738	1 389
	Index	100	156	63	50
Total of all third countries	Quantity (tonnes)	5 542	19 716	14 893	8 544
	Index	100	356	269	154
	Market share (%)	1,3	6,1	5,2	2,5
	Index	100	468	399	188
	Average price	3 069	3 718	1 813	1 298
	Index	100	121	59	42
Source: Eurostat.	Source: Eurostat.	Source: Eurostat.	Source: Eurostat.	Source: Eurostat.	Source: Eurostat.

• (365) Import volumes from Taiwan increased by over 400 % in 2022, but then fell in 2023 and the investigation period. In terms of volume, they increased from around 3 500 tonnes in 2021 to 6 800 tonnes in the investigation period. The market share of these imports (as a % of total consumption) reached 6,1 % in 2022, but fell back to 2 % in the investigation period. The average price of imports from Taiwan fluctuated in a similar manner and at a similar level to those of imports from the countries concerned. Their market share fell to 2 % in the investigation period.

• (366) Import volumes from other third countries (mainly South Korea in the investigation period) fell from around 2 000 tonnes in 2021 to 1 700 tonnes in the investigation period. The market share of these imports (as a % of total consumption) was always below 1 %. The average price of imports from third countries fluctuated in a similar manner and at a similar level to those of imports from the countries concerned.

• (367) Bearing in mind that imports from Taiwan and other third countries had a low market share and slightly higher prices than imports from the countries concerned, the Commission concluded that these imports did not attenuate the causal link with respect to the imports from the countries concerned.

5.2.2.   Export performance of the Union industry

• (368) The volume of exports of the Union producers developed over the period considered as follows in Table 13. Also, shown in Table 13, is the average price of exports to unrelated parties of the sampled Union industry.

Table 13

Export performance of the sampled Union producers

	2021	2022	2023	Investigation period
Export volume (tonnes)	[20 000 –25 000 ]	[15 000 –20 000 ]	[1 000 –2 000 ]	[2 000 –5 000 ]
Index	100	77	7	16
Average EXW price (EUR/tonne)	[2 000 –3 000 ]	[4 000 –5 000 ]	[1 000 –3 000 ]	[1 000 –2 000 ]
Index	100	152	72	54
Source: Union industry questionnaire replies.	Source: Union industry questionnaire replies.	Source: Union industry questionnaire replies.	Source: Union industry questionnaire replies.	Source: Union industry questionnaire replies.

• (369) The export quantity of the Union industry decreased by 84 % over the period considered. Export quantities represented around 10 % of Union industry sales (including captive use) in 2021, but this fell to around 1 % in the investigation period.

• (370) The sales prices of these exports fluctuated in line with its sales on the Union market as shown in Table 8, i.e. due to the influence of imports to those markets and raw material prices. It is evident that the export performance of the Union industry deteriorated over the analysis period. However, as the Union industry has not been a major supplier to the export markets, the deteriorating export performance was not considered as a major factor in the overall assessment of the economic situation of the Union industry.

• (371) Therefore, the Commission concluded that the export performance of the Union industry did not cause material injury to the Union industry or was able to attenuate the causal link with respect to imports from the countries concerned.

5.2.3.   Increases in Raw Material and Energy Costs

• (372) The sampled Union producers had different production technologies, using different raw materials. However, the costs of the major raw materials and energy followed similar trends and for all three sampled producers raw material and energy costs represented over 50 % of their total cost of production.

• (373) As can be seen from Table 8 costs increased by 94 % in 2022 and then fell in 2023 (by 19 %) and fell again the investigation period (by a further 29 %). Despite the reduction in costs in 2023 and the investigation period, costs were still 13 % higher in the investigation period than in 2021.

• (374) Bearing in mind raw material and energy costs it was clear that the development of costs had played a major role in the BDO industry over the period considered. However, Table 8 shows that when costs were at their highest in 2022 the Union industry was nevertheless able to pass on these cost increases to their customers. From 2023 onwards, however, despite falling raw material and electricity costs, it could not sell at a profitable level or above production costs. This was due to the price pressure from the increasing volumes of imports, which caused a disconnect between costs and prices in the Union.

• (375) In addition, fixed costs per unit increased dramatically due to lower Union production from the lower sales generated by the Union due to the unfair competition of dumped imports. This contributed as well to the increase of production costs per unit for the Union industry, and increased for example energy, water or other fixed costs per unit. Energy costs in addition, had typically a significant fixed component which needed to be spread over high production levels by the Union producers and this could not be achieved, due to reduced sales under price pressure of dumped imports.

• (376) Celanese submitted that there was a sharp increase in global BDO prices between 2020 and 2022, due to the aftermath of the COVID-19 crisis and from BDO shortages, combined with an energy crisis. But from 2023 BDO markets stabilised and the any price decrease is instead a sign of normalization rather than injury. Therefore, Celanese alleged that it is the high energy costs and inflation which are rather causing challenges to the EU industry and not the dumped imports from the countries concerned. However, the Commission disputed this view as, first although BDO energy prices in the Union were falling during the period considered, yet the price of dumped imports have fallen more steeply and have not allowed the Union industry to sell at prices above their cost of production. Second, there doesn’t seem to be any global BDO shortage during the period considered, instead there seems rather a widely acknowledged substantial capacity increase, in the magnitude of multiples of global BDO demand in the period considered, which resulted in substantial over-capacity and the lowering of BDO prices. Thirdly, the cost of production is also influenced by the fixed cost of production for which the Union is suffering from an increasing amount of dumped imports from the countries concerned in the period considered, which didn’t allow the industry to increase sales and therefore production volumes, resulting in further costs of production per unit of BDO regardless of raw material costs. Finally, the increased volumes and price declines from dumped imports of the countries concerned depressed BDO prices in 2023 and IP to such levels that BDO Union production is not sustainable even at short term, despite the significantly reduced electricity, natural gas and other raw material costs of production when compared to 2022.

• (377) Also, in respect of costs several interested parties commented that the Union industry was simply not competitive enough due to its high costs. This claim was also rejected as the industry was profitable in 2021 and 2022. In addition, the alleged high costs were not the cause of the injury in 2023 and the investigation period as such costs were falling in that period.

• (378) The Commission concluded that the increases in raw material and energy costs provided context to the injury suffered by the Union industry. However, the root cause of the injury was increasing volumes of dumped imports from the countries concerned which depressed BDO prices to levels which did not permit the Union industry to recover its costs and increased the cost of production per unit of the Union from lower sales and production levels.

• (379) Therefore, the Commission concluded that increases in raw material and energy costs did not cause injury to the Union industry.

5.2.4.   Imports by the Union Producers

• (380) The Union producers all imported significant quantities of BDO from the countries concerned. Several interested parties commented that this was a cause of the injury suffered by the Union producers. The Commission therefore assessed why these imports took place because all Union producers had spare capacity in the Union and could therefore have produced these quantities themselves.

• (381) The Union producers commented that, under normal conditions of competition, imports from the countries concerned would take place to deal with short term production issues with installed capacity. It is not cost-effective to stock large quantities of BDO because such storage must be held in large, temperature-controlled tanks meaning that deliveries to customers are normally made soon after production. The level of production would therefore be adjusted to cope with the needs of industrial users and captive needs.

• (382) However, in 2023 and the investigation period imports by the Union industry increased because BDO prices on the Union market became depressed by dumped imports and the Union industry costs, although falling from 2022 levels, were above the depressed price level in the Union.

• (383) Imports were also made to counteract any production issues which might arise or maintenance downtime during the period considered, in order to continue to meet customer contracts or continue to produce downstream products due to the low stock capacities in the Union.

• (384) Therefore, the imports by the Union industry were a short-term defence measure in order that they could maintain their position and reputation on the Union market by reliably supplying the industrial users whilst continuing captive production.

• (385) Therefore, the Commission concluded that imports by the Union industry in 2023 and the investigation period were a symptom of the injury caused by the dumped imports rather than a cause of injury in itself.

5.2.5.   Developments in Consumption

• (386) The Commission assessed the impact of consumption on the Union market by examining captive use, sales on the free market and by assessing developments in total consumption using the data shown in Table 2.

• (387) Captive use fell by 38 % over the period considered. Most of this decline took place in 2022, by around 81 000 tonnes or 31 %. From 2022 to the investigation period captive use fell by around 20 000 tonnes or by 11 %.

• (388) Free market consumption increased by around 25 000 tonnes or 15 % over the period considered. From 2022 to the investigation period such sales increased by around 25 000 tonnes or by 33 %.

• (389) When assessed cumulatively captive use and sales on the free market decreased by around 77 000 tonnes or 18 % over the period considered. However, total consumption increased by from 2022 to the investigation period by around 25 000 tonnes or by 8 %.

• (390) The cumulative decrease of Union sales and captive use in the key period of 2022 to the investigation(389) represents a quantity issue for the Union industry. However, the main injury in this investigation relates to price depression and resulting heavy losses in return on turnover and other performance indicators.

• (391) Therefore, the Commission concluded that developments in consumption on the Union market did not cause material injury to the Union industry.

5.3.   Conclusion on causation

• (392) The Union producers of BDO in the Union in the investigation period sold to a several industrial users in many user sectors. The investigation showed that the presence of low-priced dumped imports from the countries concerned, at significant and increasing quantities, had the effect of depressing prices in the period considered especially in 2023 and the investigation period. This development had the impact of seriously decoupling BDO prices from the cost of production, and of affecting sales and production levels. Consequently, the profitability of the Union industry sales was heavily loss-making in 2023 and the investigation period. Such losses are clearly unsustainable and threaten the survival of the Union industry even in the short term.

• (393) Other factors examined were imports from other sources, the export performance of the Union industry, developments in consumption including captive use, imports by the Union industry and increases in raw material and energy costs.

• (394) Therefore, the Commission has distinguished and separated the effects of all known factors affecting the situation of the Union industry from the injurious effects of the dumped imports. None of the factors, collectively or separately, were found to have a significant bearing on the situation of the Union industry sufficient to call into question the conclusion that the imports from the countries concerned were causing material injury.

• (395) On the basis of the above, the Commission concluded that the dumped imports from the country concerned caused material injury to the Union industry. The injury consists mainly of price depression, inadequate profitability, return on investments, cash flow, ability to raise capital.

6. LEVEL OF MEASURES

• (396) To determine the level of the measures, the Commission examined whether a duty lower than the margin of dumping would be sufficient to remove the injury caused by dumped imports to the Union industry.

6.1.   Injury margin

• (397) The injury would be removed if the Union industry were able to obtain a target profit by selling at a target price in the sense of Articles 7(2c) and 7(2d) of the basic Regulation.

• (398) In accordance with Article 7(2c) of the basic Regulation, for establishing the target profit, the Commission took into account the following factors: the level of profitability before the increase of imports from the countries under investigation, the level of profitability needed to cover full costs and investments, research and development (R & D) and innovation, and the level of profitability to be expected under normal conditions of competition. Such profit margin should not be lower than 6 %.

• (399) As a first step, the Commission established a basic profit covering full costs under normal conditions of competition. This was obtained from the profitability of the Union industry in 2022 which was the most recent year prior to the surge of dumped imports in 2023. A much higher profitability figure was achieved in 2021 however, this was considered to be a boom year for the industry because of high Union consumption due to the Covid-19 pandemic. The profit margin in 2022 was established at [10 %–25 %], as per Table 11.

• (400) Two of the sampled Union producers provided evidence that its level of investments, research and development (R & D) and innovation during the period considered would have been higher under normal conditions of competition. The Commission verified this information using investment plans which were to be implemented in the period considered but were cancelled due to the impact of the dumped imports from the countries concerned. Therefore, the claims of the Union Industry were found to be warranted. To reflect this in the target profit, the Commission calculated the difference between investments, R & D and innovation (‘IRI’) expenses under normal conditions of competition as provided by the Union Industry and verified by the Commission with actual IRI expenses over the period considered. Such difference, expressed as a percentage of turnover, was 0,30 %.

• (401) Such percentage of 0,3 % was added to the basic profit margin of [10 % to 25 %], mentioned in the recital 399, leading to a target profit of [10,30 % to 25,30 %].

• (402) On this basis, the non-injurious price is [2 000 to 2 800] EUR per tonne, resulting from applying the above-mentioned profit margin of [10,30 % to 25,30 %], to the cost of production during the IP of the sampled Union producers.

• (403) In accordance with Article 7(2d) of the basic Regulation, as a final step, the Commission assessed the future costs resulting from Multilateral Environmental Agreements, and protocols thereunder, to which the Union is a party, and of ILO Conventions listed in Annex Ia that the Union industry will incur during the period of the application of the measure pursuant to Article 11(2) of the basic Regulation. The Union industry provided evidence that that their costs under the EU ETS scheme and similar national programs would increase during the life of the measures. These increased costs would arise because the Union industry would receive less free allowances under the ETS from 2026-2030 (on average) as compared to the investigation period. Additionally, an extraction of ETS futures sourced from Bloomberg (made available on the case file) showed that ETS allowances in 2026-2030 are forecasted to increase in price per tonne of CO2 emitted. The Commission accepted the claims and added the cost amounting to 25 EUR per tonne to the non-injurious price mentioned in recital 402.

• (404) In addition, the sampled Union producers claimed that CO2 indirect costs by, resulting from future extra costs associated with CO2 emitted from electricity purchased and consumed should be taken into account as future costs under Article 7(2d) of the basic Regulation. This claim was provisionally rejected as the costs claimed were not directly incurred by the Union producer concerned and were not substantiated.

• (405) On this basis, the Commission calculated a non-injurious price of [2 000 to 2 800] EUR per tonne for the like product of the Union industry by applying the above-mentioned target profit margin to the cost of production of the sampled Union producers during the investigation period and then adding the adjustments under Article 7(2d) of the basic Regulation on a type-by-type basis.

• (406) The Commission then determined the injury margin level on the basis of a comparison of the weighted average import price of the sampled cooperating exporting producers in countries concerned, as established for the price undercutting calculations, with the weighted average non-injurious price of the like product sold by the sampled Union producers on the Union market during the investigation period. Any difference resulting from this comparison was expressed as a percentage of the weighted average import CIF value.

• (407) The injury elimination level for ‘other cooperating companies’ and for ‘all other imports originating in each of the countries concerned’ is defined in the same manner as the dumping margin for these companies and imports.

Country	Company	Dumping margin (%)	Injury margin (%)
China	Xinjiang Markor Chemical Industry Co., Ltd.	311,9	105,6
China	Wanhua Chemical (Sichuan) Co., Ltd	522,4	113,7
China	Other cooperating companies in China	362,8	107,5
China	All other imports originating in China	522,4	113,7
Saudi Arabia	International Diol Company	52,4	127,8
Saudi Arabia	All other imports originating in Saudi Arabia	52,4	127,8
USA	Lyondell Chemical Company	135,7	148,3
USA	All other imports originating in the US	142,5	153,4

6.2.   Conclusion on the level of measures

• (408) Following the above assessment, provisional anti-dumping duties should be set as below in accordance with Article 7(2) of the basic Regulation:

Country	Company	Provisional anti-dumping duty (%)
China	Xinjiang Markor Chemical Industry Co., Ltd.	105,6
China	Wanhua Chemical (Sichuan) Co., Ltd	113,7
China	Other cooperating companies in China	107,5
China	All other imports originating in China	113,7
Saudi Arabia	International Diol Company	52,4
Saudi Arabia	All other imports originating in Saudi Arabia	52,4
USA	Lyondell Chemical Company	135,7
USA	All other imports originating in the USA	142,5

7. UNION INTEREST

7.1.   Interest of the Union industry

• (409) There are four companies producing BDO in the Union Industry directly employing around 500 staff. The producers are located in Germany, Netherlands and Italy. All four Union producers co-operated fully with the investigation by submitting questionnaire replies.