Evidence of meeting #10 for International Trade in the 43rd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was aluminum.
A video is available from Parliament.
President, Northern Cables Inc.
We would enjoy seeing that. We have not seen that. That is one of our concerns, because we are suffering from that right at this very moment.
Chief Executive Officer, Northern Cables Inc.
One of the issues that has arisen previously in the United States—and we are not trade experts, so pardon us—is that these U.S. HTS codes and Canadian HS codes are quite extensive on the copper side, but on the aluminum side, there are very few codes. As a result of that, they're very broad. Any attempt by the United States to control goods coming into the country is easily circumvented by simply applying a non-needed connector or some other feature to the cable, to allow it to fall into another category.
In Canada, now we have a lot of aluminum conductors coming into the country. Everybody knows about it. We've had a number of people go along to the major distributors. In fact, I received a call today from our largest customer for aluminum cables telling us that they're under pressure to start sourcing products overseas where they can buy aluminum conductors below world market prices because they're subsidized by these other countries, and there's nothing we can do to prevent this from entering the country.
Liberal
The Chair Liberal Judy Sgro
I'm sorry, but I have to interrupt at this point. The time is up.
Mr. Simard-Tremblay.
Bloc
Simon-Pierre Savard-Tremblay Bloc Saint-Hyacinthe—Bagot, QC
It isn't Simard-Tremblay, it's Savard-Tremblay.
Bloc
Simon-Pierre Savard-Tremblay Bloc Saint-Hyacinthe—Bagot, QC
My question is for the representatives of Northern Cables Inc.
What do you plan to do to adjust to the situation?
Simon-Pierre Savard-Tremblay Bloc Saint-Hyacinthe—Bagot, QC
Okay.
Since you're used to producing a large amount of cable, how do you plan to adapt to the situation?
President, Northern Cables Inc.
We are working with our industry association currently to have the Canadian government recognize unfair dumping of aluminum products in Canada in order to level the playing field for Canadian manufacturers.
Bloc
Simon-Pierre Savard-Tremblay Bloc Saint-Hyacinthe—Bagot, QC
Could you elaborate on how China is proceeding with the dumping that you mentioned?
Could you tell us which sectors are the most affected? You talked about copper and aluminum, but could you elaborate?
President, Northern Cables Inc.
The most significant area is aluminum. There are many aluminum products, but in our specific industry, it's electrical cables. We have Chinese sales-people driving down the 401 to distributors, offering to sell products at less than the cost of raw materials. We buy all of our aluminum from the province of Quebec, and all the aluminum that's coming from China is coming from a state-subsidized manufacturer.
Bloc
Simon-Pierre Savard-Tremblay Bloc Saint-Hyacinthe—Bagot, QC
When you talk about state-subsidized factories, are you referring to China, meaning the country of origin?
Bloc
Simon-Pierre Savard-Tremblay Bloc Saint-Hyacinthe—Bagot, QC
The next step is the Mexican market, for example. Is that right?
President, Northern Cables Inc.
It does. Right now each country has its own action or situation. The U.S. Department of Commerce just in the last 90 days has fined and levied duties on Chinese cable, but I'm not sure about Mexico, and Canada has not done that.
Bloc
President, Northern Cables Inc.
Most certainly. We're working with our industry association right now to that end.
Our concern is it's very late for our industry. We are the last Canadian-owned aluminum cable manufacturer. Everybody else has either left, closed or sold out to multinational companies.
Bloc
Simon-Pierre Savard-Tremblay Bloc Saint-Hyacinthe—Bagot, QC
I just want to make sure that I understand, and you've probably said this already, but I want a little reminder. Your cables aren't just made of aluminum. Is that right?
President, Northern Cables Inc.
Yes. We make both copper and aluminum conductor cables.
Bloc
President, Northern Cables Inc.
Not in our sector of the industry. We make fairly large power cables.
The imported cables, probably because of the weight, have been less of an issue than the aluminum cables.
I know in the data cable telecom industry, imports have been devastating.
Bloc
Simon-Pierre Savard-Tremblay Bloc Saint-Hyacinthe—Bagot, QC
I have a slightly more technical question. What makes them different from one another? Is it simply that certain cables will be used more for making certain tools, that aluminum will be used for some tools and copper will be used for others, or is one technology replacing the other? In other words, is it a matter of sector or a matter of trend?
President, Northern Cables Inc.
There is some overlap. Aluminum is used in large industrial cables for mining applications and power feed for large commercial buildings and condominiums. Aluminum is taking over copper because there's about a three to one price difference and it's lighter to work with and is readily available.
In our products aluminum is much less volatile in price so it is becoming more popular so the market is growing for aluminum cables. The cables are made in Canada to a CSA standard, and we have CSA inspectors in our factory every week. I don't know if they go to other factories in other countries and I don't know if they're checked at the ports. CSA walks our factory floor to make sure the cables are being made to standard. Again, we only use North American raw materials so we're very confident in the quality of the raw materials.
NDP
Daniel Blaikie NDP Elmwood—Transcona, MB
Thank you, everybody, for appearing here today.
I want to continue the conversation with Northern Cables.
I'm trying to understand the path of this cable coming to Canada. In the case of auto, there are country-of-origin rules. The concern is that aluminum will be coming to Mexico and then turned into parts in Mexico and then Canada's North American content.
Am I hearing correctly from you that it's direct entry in this case, that aluminum is coming from China and it's already manufactured as cable in China? It's competing because it's subsidized manufacturing?