Evidence of meeting #120 for International Trade in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was industry.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

Leigh Coulter  President, GGS Structures Inc.
Kalyan Ghosh  President and Chief Executive Officer, Essar Steel Algoma Inc.
David McHattie  Vice-President, Institutional Relations Canada, Tenaris
Terry Sheehan  Sault Ste. Marie, Lib.
Harold Albrecht  Kitchener—Conestoga, CPC

11:30 a.m.

Sault Ste. Marie, Lib.

Terry Sheehan

You made a comment about Trump lifting the tariffs. You can't count on what Trump says—it can change from day to day—but you did mention quotas. Please expand on how you think a quota system would work for Algoma. Then I'll go to David.

11:30 a.m.

Liberal

The Chair Liberal Mark Eyking

This has to be one short answer.

11:30 a.m.

President and Chief Executive Officer, Essar Steel Algoma Inc.

Kalyan Ghosh

If we get into quotas, it is important that the government ensures the quota is distributed to each company product-wise, based on past exports to the U.S., and it is not given as a free-for-all. That will lead to.... Basically, whoever gets to the border first completes the quota. Yesterday I heard Brazil has a quota, which it didn't before. The ships were waiting for the quarter-end to go into the U.S.

This would not work for us because we have too many entry points to the U.S. There are too many suppliers. It would be chaos. The government has to institute and give quotas based on past performance, product-wise and company-wise.

11:30 a.m.

Liberal

The Chair Liberal Mark Eyking

Thank you, sir.

We're going to move over to the NDP now. Ms. Ramsey, you have the floor.

11:30 a.m.

NDP

Tracey Ramsey NDP Essex, ON

Like many of you, I was really disappointed to see the USMCA come through without the permanent exemption of the steel and aluminum tariffs. This threat is still sitting there as a threat to people who work in your facilities, and really to supply chains across our country. It's a deep disappointment.

The government said that they would have the backs of Canadian steelworkers. What I can see is that they're moving very slowly on following through on that. Things are not happening quickly enough. Now we have this exemption, with an unknown future for everyone. What I'm experiencing down in southwestern Ontario—and I know some of my other colleagues in Ontario are as well—is that shops are closing. The small folks just can't weather this. I know that you're some of the larger players in the industry. We have those as well, who are trying their best to not lay people off and to make sure that they can see the benefit of their investments in what they want to do in the years to come.

This committee did a study very early on in 2015—I think it came out in 2017—on the Canadian steel industry's ability to compete internationally. The issues that you're facing are not new or unknown to this government, but the movement they've had has been so extremely slow.

One of the producers in my region said that in this last year alone, by Global Affairs' own numbers, some of the dumping has increased by up to 200%. That's 200% over the last year. Clearly, we're not doing everything we can to support you, to keep your industry strong, and to keep those jobs protected. For that I'm just shaking my head because there are things that you're saying today that we can do.

I think the safeguard measures are important. I just wanted to ask Mr. McHattie about the safeguard measures. Have you been speaking to the government about what you think those should look like? They aren't applied across the board, of course. Some were announced for energy, but certainly non-energy is still not captured in that. I have folks who want to see all of steel have the safeguard measures in place. I ask both of you if you've been involved in conversations around the safeguards, and what does the government need to do?

11:35 a.m.

Vice-President, Institutional Relations Canada, Tenaris

David McHattie

First I want to commend the government for taking the courage to study this, and also to be open. They had a very generous public consultation period that allowed buyers of steel—users of steel—to have their feedback as well.

I think being consultative is correct, but now that this process is over I believe it's the time to act. We've had interactions with the government and we expect.... We have no knowledge of any—

11:35 a.m.

NDP

Tracey Ramsey NDP Essex, ON

Have you had follow-up meetings since those consultations?

11:35 a.m.

Vice-President, Institutional Relations Canada, Tenaris

David McHattie

We've had follow-up meetings to clarify the positions that we have proposed in writing. It is now in the hands of the government as to if and when they will take action. We're hopeful that it's imminent, but as I said before, every week that goes by is troubling to us. I think the process they've used is commendable, and we look forward to a full investigation, where the facts will bear out.

11:35 a.m.

NDP

Tracey Ramsey NDP Essex, ON

In the USMCA were you at the table? Were you able to be a part of the conversations that were happening around the hope that this would be removed, and potentially offering the quota solutions that you spoke about? Were you able to convey that to the government during those negotiations?

Okay.

One of the government programs you applied for, which you were speaking to my colleague about, is that under the $2-billion umbrella?

11:35 a.m.

President and Chief Executive Officer, Essar Steel Algoma Inc.

11:35 a.m.

NDP

Tracey Ramsey NDP Essex, ON

Okay.

What I'm hearing down in my region, and we've heard it at this committee, is about the difficulty of being able to navigate that process and the timeline around it being very long. I recognize that you're larger players in this sector in Canada, but I wonder if you can describe a bit about navigating that process, and the time that you applied to where you're at now. I want to get an understanding of that.

11:35 a.m.

President and Chief Executive Officer, Essar Steel Algoma Inc.

Kalyan Ghosh

Are you asking me?

11:35 a.m.

NDP

Tracey Ramsey NDP Essex, ON

Yes.

11:35 a.m.

President and Chief Executive Officer, Essar Steel Algoma Inc.

Kalyan Ghosh

When it came out, we put in a letter of intent about three weeks back, and we were told that we can start applying. We are putting in an application and we hopefully should apply next week.

11:35 a.m.

Liberal

The Chair Liberal Mark Eyking

You have about 20 seconds. If you want to get a quick question and quick answer in, we can do it.

11:35 a.m.

NDP

Tracey Ramsey NDP Essex, ON

I'd just like a response to that.

Have you applied for any of the $2 billion?

11:35 a.m.

Vice-President, Institutional Relations Canada, Tenaris

David McHattie

We have not applied. For us it's very important to have a strong and healthy market. I again commend the government on the work on Trans Mountain, in trying to get our resources to market. These are fundamentally important to us. Canada is the fourth-largest market for the products we make, yet our clients can't get their products to market. I think in the USMCA, the energy industry in general is happy, but they need to get their products to market.

I commend the committee on its support for the steel industry, but it's also important to the users of steel, and the energy sector is very important in that regard.

11:35 a.m.

Liberal

The Chair Liberal Mark Eyking

Thank you.

We're going back to the Liberals.

Madam Ludwig, you have the floor.

11:35 a.m.

Liberal

Karen Ludwig Liberal New Brunswick Southwest, NB

Thank you.

Thank you, all, this morning for your presentations. Your information is absolutely critical to all of us moving forward, not only as a government but certainly as Canadians and strengthening our economy.

I'm going to start my questions off with Ms. Coulter.

I represent New Brunswick Southwest, which is obviously in the east, and we have a number of steel fabricators. One of the things that I heard from a fabricator who likes to meet me at the airport when I'm coming back from Ottawa is that each fabrication plant is individually certified, so it's not that easy to obtain steel from another supplier. He gave me the example where they import the steel from the U.S., fabricate it and export it.

Could you tell me about your experience with that? Is that the case across the country? I'm trying to get a context for fabrication.

11:40 a.m.

President, GGS Structures Inc.

Leigh Coulter

I think that might be specific to his particular business. For us, because we manufacture building products, we have to have certain certification of our steel. The steel mill certifications we have to vet and do that. We do have certifications, but what we would need would not be the same as a fencing supply company or that. It's probably a little bit dependent on his particular industry.

11:40 a.m.

Liberal

Karen Ludwig Liberal New Brunswick Southwest, NB

Okay. Thank you.

Looking at the countermeasures for tariffs, did you have an opportunity to speak with your MP or reach out in terms of services or options the government was looking to provide?

11:40 a.m.

President, GGS Structures Inc.

Leigh Coulter

I'm sure I had the opportunity. Our MP is Dean Allison, and he's very open. I've had many conversations with him, but honestly, I suffer from being an SME, which means that we are so busy working in our business that we often don't have the time to spend learning about these things. It definitely would be a big help to have better communication from the government to SMEs. Particularly, we use CFIB, we use CME, the Canadian Manufacturers & Exporters, and we get information that way. But it is hard, as a small business. We don't have the ability to have somebody full time looking at these things.

11:40 a.m.

Liberal

Karen Ludwig Liberal New Brunswick Southwest, NB

Thank you for pointing that out as well. That's definitely something we've heard consistently across this committee in terms of government and services, and how we could better get that information to the SMEs that are so busy making payroll and doing what they do. Thank you.

My next question actually is to Mr. McHattie. Can you describe any measures undertaken by the government that have impacted your industry in terms of improving the trade remedy regime? Thank you.

October 2nd, 2018 / 11:40 a.m.

Vice-President, Institutional Relations Canada, Tenaris

David McHattie

These measures have now been in place for roughly nine months, and I might prefer to share it in writing. Specifically, though, there were increases to the CBSA resources. There have been adjustments to the way normal values can be calculated. For example, the use of a particular market situation was an important opportunity. Our trade law didn't include that explicitly, whereas others did. That helped us to get up to that.

Then there has been some transparency added to the system. In the past we felt like we didn't have the information we needed to prepare the CBSA and the CITT to take appropriate action, and now there is more transparency. There is reporting out of those that are subject to findings such as the amount they have had to pay every year in anti-dumping duties, as well as other aspects that really help us to help the government make sure the system is effective.

11:40 a.m.

Liberal

Karen Ludwig Liberal New Brunswick Southwest, NB

Thank you. Did you say in your testimony that you were directly involved with the CME?