As
@rokshana said, this was a failout. Surgery programs are usually not in the business of canning their categorical residents after one year. There have to be significant issues that they feel can't be fixed to make that happen. They run the risk of not having a full complement of residents next year by not renewing you, so they can be hurt as well.
You don't know what you don't know. What I've typically seen from people that end up changing residencies or getting nonrenewed or fired, those people don't realize how exactly they are doing. Often they will think its just a few people against them and they turned the rest of the staff against them as well. Sometimes they think they are doing ok when they are performing at or below a 3rd year med student level. What might be worthwhile for you is to find one or two staff members or maybe chief residents that you trust to give you some honest feedback and that you feel you have at least a bit of support from and ask them what you did wrong and how they felt you could have improved. You probably won't like what they say and you might feel hurt afterwards. That's normal. But it might give you insight on why you failed out at residency and can help to guide you on your next step.
I worry about your ability to get into another surgery position, likely a prelim position, and impress people enough to actually make it into a categorical position. You'll be under a microscope if that happened and the least little thing that happened will be seen as a repeat of what lost your initial position. Once you get that reputation again, you are sunk. I can only imagine what that PD letter would read when you're trying to get a nonsurgery position.
Yes. This sucks. You feel your dream is being taken away from you. But in the end, maybe this will turn out better for you in the long run. Good luck.