2025-00545. Sol Gel Alumina-Based Ceramic Abrasive Grains From the People's Republic of China: Initiation of Countervailing Duty Investigation

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Department of Commerce

International Trade Administration

1. [C-570-191]

AGENCY:

Enforcement and Compliance, International Trade Administration, Department of Commerce.

DATES:

Applicable January 6, 2025.

FOR FURTHER INFORMATION CONTACT:

Suresh Maniam, Office I, AD/CVD Operations, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 1401 Constitution Avenue NW, Washington, DC 20230; telephone: [phone].

SUPPLEMENTARY INFORMATION:

The Petition

On November 25, 2024, the U.S. Department of Commerce (Commerce) received a countervailing duty (CVD) petition concerning imports of sol gel alumina-based ceramic abrasive grains (ceramic abrasive grains) from the People's Republic of China (China) filed in proper form on behalf of Saint-Gobain Ceramics & Plastics, Inc. (the petitioner), a U.S. producer of ceramic abrasive grains.^[1] The CVD Petition was accompanied by an antidumping duty (AD) petition concerning imports of ceramic abrasive grains from China.^[2]

Between November 27, 2024, and December 17, 2024, Commerce requested supplemental information pertaining to certain aspects of the Petition in supplemental questionnaires.^[3] Between December 4 and 23, 2024, the petitioner filed timely responses to these requests for additional information.^[4]

On December 6, 2024, Commerce extended the initiation deadline by 20 days to poll the domestic industry in accordance with sections 702(c)(1)(B) and 702(c)(4)(D) of the Tariff Act of 1930, as amended (the Act), because the Petition “{had} not established that the domestic producers or workers accounting for more than 50 percent of total production support the {Petition}. . . .” ^[5]

In accordance with section 702(b)(1) of the Act, the petitioner alleges that the Government of China (GOC) is providing countervailable subsidies, within the meaning of sections 701 and 771(5) of the Act, to producers of ceramic abrasive grains in China, and that such imports are materially injuring, or threatening material injury to, the domestic industry producing ceramic abrasive grains in the United States. Consistent with section 702(b)(1) of the Act and 19 CFR 351.202(b), for those alleged programs on which we are initiating a CVD investigation, the Petition was accompanied by information reasonably available to the petitioner supporting its allegations.

Commerce finds that the petitioner filed the Petition on behalf of the domestic industry, because the petitioner is an interested party, as defined in section 771(9)(C) of the Act. Commerce also finds that the petitioner demonstrated sufficient industry support with respect to the initiation of the requested CVD investigation.^[6]

Period of Investigation

Because the Petition was filed on November 25, 2024, the period of investigation for the CVD investigation is January 1, 2023, through December 31, 2023.^[7]

( print page 3176)

Scope of the Investigation

The products covered by this investigation are ceramic abrasive grains from China. For a full description of the scope of this investigation, see the appendix to this notice.

Comments on the Scope of the Investigation

On November 27, 2024 and December 6, 2024, Commerce requested information and clarification from the petitioner regarding the proposed scope to ensure that the scope language in the Petition is an accurate reflection of the products for which the domestic industry is seeking relief.^[8] On December 4 and 9, 2024, the petitioner provided clarifications and revised the scope.^[9] The description of merchandise covered by this investigation, as described in the appendix to this notice, reflects these clarifications.

As discussed in the Preamble to Commerce's regulations, we are setting aside a period for interested parties to raise issues regarding product coverage ( i.e., scope).^[10] Commerce will consider all comments received from interested parties and, if necessary, will consult with interested parties prior to the issuance of the preliminary determination. If scope comments include factual information, all such factual information should be limited to public information.^[11] To facilitate preparation of its questionnaire, Commerce requests that scope comments be submitted by 5:00 p.m. Eastern Time (ET) on January 27, 2025, which is the next business day after 20 calendar days from the signature date of this notice.^[12] Any rebuttal comments, which may include factual information, must be filed by 5:00 p.m. ET on February 6, 2025, which is 10 calendar days from the initial comment deadline.

Commerce requests that any factual information that parties consider relevant to the scope of the investigation be submitted during that time period. However, if a party subsequently finds that additional factual information pertaining to the scope of the investigation may be relevant, the party must contact Commerce and request permission to submit the additional information. All scope comments must be filed simultaneously on the records of the concurrent AD and CVD investigations.

Filing Requirements

All submissions to Commerce must be filed electronically via Enforcement and Compliance's Antidumping Duty and Countervailing Duty Centralized Electronic Service System (ACCESS), unless an exception applies.^[13] An electronically filed document must be received successfully in its entirety by the time and date it is due.

Consultations

Pursuant to sections 702(b)(4)(A)(i) and (ii) of the Act, Commerce notified the GOC of the receipt of the Petition and provided an opportunity for consultations with respect to the Petition.^[14] The GOC did not request consultations.^[15]

Determination of Industry Support for the Petition

Section 702(b)(1) of the Act requires that a petition be filed on behalf of the domestic industry. Section 702(c)(4)(A) of the Act provides that a petition meets this requirement if the domestic producers or workers who support the petition account for: (i) at least 25 percent of the total production of the domestic like product; and (ii) more than 50 percent of the production of the domestic like product produced by that portion of the industry expressing support for, or opposition to, the petition. Moreover, section 702(c)(4)(D) of the Act provides that, if the petition does not establish support of domestic producers or workers accounting for more than 50 percent of the total production of the domestic like product, Commerce shall: (i) poll the industry or rely on other information in order to determine if there is support for the petition, as required by subparagraph (A); or (ii) determine industry support using a statistically valid sampling method to poll the “industry.”

Section 771(4)(A) of the Act defines the “industry” as the producers as a whole of a domestic like product. Thus, to determine whether a petition has the requisite industry support, the statute directs Commerce to look to producers and workers who produce the domestic like product. The U.S. International Trade Commission (ITC), which is responsible for determining whether “the domestic industry” has been injured, must also determine what constitutes a domestic like product in order to define the industry. While both Commerce and the ITC apply the same statutory definition regarding the domestic like product,^[16] they do so for different purposes and pursuant to a separate and distinct authority. In addition, Commerce's determination is subject to limitations of time and information. Although this may result in different definitions of the like product, such differences do not render the decision of either agency contrary to law.^[17]

Section 771(10) of the Act defines the domestic like product as “a product which is like, or in the absence of like, most similar in characteristics and uses with, the article subject to an investigation under this title.” Thus, the reference point from which the domestic like product analysis begins is “the article subject to an investigation” ( i.e., the class or kind of merchandise to be investigated, which normally will be the scope as defined in the petition).

With regard to the domestic like product, the petitioner does not offer a definition of the domestic like product distinct from the scope of the investigation.^[18] Based on our analysis of the information submitted on the record, we have determined that ( print page 3177) ceramic abrasive grains, as defined in the scope, constitute a single domestic like product, and we have analyzed industry support in terms of that domestic like product.^[19]

As noted above, on December 6, 2024, Commerce extended the initiation deadline by 20 days to poll the domestic industry in accordance with sections 702(c)(1)(B) and 702(c)(4)(D) of the Act because the Petition “{had} not established that the domestic producers or workers accounting for more than 50 percent of total production support the {Petition}. . . .” ^[20] On December 10, 2024, we issued polling questionnaires to all known producers identified in the Petition.^[21] We requested that the companies complete the polling questionnaire and certify their responses by the due date specified in the cover letter to the questionnaire. We received timely responses to these questionnaires from domestic producers on December 17, 2024.^[22] No interested party submitted comments on the polling questionnaire responses.

Our analysis of the data we received in the polling questionnaire responses indicates that the domestic producers and workers who support the Petition account for at least 25 percent of the total production of the domestic like product and more than 50 percent of the production of the domestic like product produced by that portion of the industry expressing support for, or opposition to, the Petition.^[23] Accordingly, Commerce determines that the industry support requirements of section 702(c)(4)(A) of the Act have been met and that the Petition was filed on behalf of the domestic industry within the meaning of section 702(b)(1) of the Act.^[24]

Injury Test

Because China is a “Subsidies Agreement Country” within the meaning of section 701(b) of the Act, section 701(a)(2) of the Act applies to this investigation. Accordingly, the ITC must determine whether imports of the subject merchandise from China materially injure, or threaten material injury to, a U.S. industry.

Allegations and Evidence of Material Injury and Causation

The petitioner alleges that imports of the subject merchandise are benefiting from countervailable subsidies and that such imports are causing, or threaten to cause, material injury to the U.S. industry producing the domestic like product. In addition, the petitioner alleges that subject imports from China exceed the negligibility threshold provided for under section 771(24)(A) of the Act.^[25]

The petitioner contends that the industry's injured condition is illustrated by the increasing volume of subject imports; reduced market share; underselling and price depression and/or suppression; lost sales and revenues; and declines in the domestic industry's production, capacity utilization, and financial performance.^[26] We assessed the allegations and supporting evidence regarding material injury, threat of material injury, causation, cumulation, as well as negligibility, and we have determined that these allegations are properly supported by adequate evidence and meet the statutory requirements for initiation.^[27]

Initiation of CVD Investigation

Based upon the examination of the Petition and supplemental responses, we find that they meet the requirements of section 702 of the Act. Therefore, we are initiating a CVD investigation to determine whether imports of ceramic abrasive grains benefit from countervailable subsidies conferred by the GOC. In accordance with section 703(b)(1) of the Act and 19 CFR 351.205(b)(1), unless postponed, we will make our preliminary determination no later than 65 days after the date of this initiation.

Based on our review of the Petition, we find that there is sufficient information to initiate a CVD investigation on 24 of the 29 programs alleged by the petitioner. For a full discussion of the basis for our decision to initiate on each program, see the China CVD Initiation Checklist. A public version of the initiation checklist for this investigation is available on ACCESS.

Respondent Selection

In the Petition, the petitioner identified 11 companies in China as producers and/or exporters of ceramic abrasive grains.^[28] Commerce intends to follow its standard practice in CVD investigations and calculate company-specific subsidy rates in this investigation. In the event that Commerce determines that the number of companies is large and it cannot individually examine each company based on Commerce's resources, Commerce normally selects mandatory respondents in CVD investigations using U.S. Customs and Border Protection (CBP) entry data for U.S. imports under the appropriate Harmonized Tariff Schedule of the United States (HTSUS) subheading(s) listed in the “Scope of the Investigation” in the appendix.

On January 2, 2025 Commerce released CBP data on imports of ceramic abrasive grains from China under administrative protective order (APO) to all parties with access to information protected by APO and indicated that interested parties wishing to comment on CBP data and/or respondent selection must do so within three business days of the publication date of the notice of initiation of this investigation.^[29] Comments must be filed electronically using ACCESS. An electronically filed document must be received successfully in its entirety via ACCESS by 5:00 p.m. ET on the specified deadline. Commerce will not accept rebuttal comments regarding the CBP data or respondent selection.

Interested parties must submit applications for disclosure under administrative protective order (APO) in accordance with 19 CFR 351.305(b). Instructions for filing such applications may be found on Commerce's website at https://www.trade.gov/​administrative-protective-orders.

Distribution of Copies of the Petition

In accordance with section 702(b)(4)(A) of the Act and 19 CFR 351.202(f), a copy of the public version of the Petition has been provided to the GOC via ACCESS. To the extent practicable, we will attempt to provide a copy of the public version of the Petition to each exporter named in the Petition, as provided under 19 CFR 351.203(c)(2). ( print page 3178)

ITC Notification

Commerce will notify the ITC of its initiation, as required by section 702(d) of the Act.

Preliminary Determination by the ITC

The ITC will preliminarily determine, within 25 days after the date on which the ITC receives notice from Commerce of initiation of the investigation, whether there is a reasonable indication that imports of ceramic abrasive grains from China are materially injuring, or threatening material injury to, a U.S. industry.^[30] A negative ITC determination will result in the investigation being terminated.^[31] Otherwise, this CVD investigation will proceed according to statutory and regulatory time limits.

Submission of Factual Information

Factual information is defined in 19 CFR 351.102(b)(21) as: (i) evidence submitted in response to questionnaires; (ii) evidence submitted in support of allegations; (iii) publicly available information to value factors of production under 19 CFR 351.408(c) or to measure the adequacy of remuneration under 19 CFR 351.511(a)(2); (iv) evidence placed on the record by Commerce; and (v) evidence other than factual information described in (i)-(iv). Section 351.301(b) of Commerce's regulations requires any party, when submitting factual information, to specify under which subsection of 19 CFR 351.102(b)(21) the information is being submitted ^[32] and, if the information is submitted to rebut, clarify, or correct factual information already on the record, to provide an explanation identifying the information already on the record that the factual information seeks to rebut, clarify, or correct.^[33] Time limits for the submission of factual information are addressed in 19 CFR 351.301, which provides specific time limits based on the type of factual information being submitted. Interested parties should review the regulations prior to submitting factual information in this investigation.

Extensions of Time Limits

Parties may request an extension of time limits before the expiration of a time limit established under 19 CFR 351.301, or as otherwise specified by Commerce. In general, an extension request will be considered untimely if it is filed after the expiration of the time limit established under 19 CFR 351.301, or as otherwise specified by Commerce.^[34] For submissions that are due from multiple parties simultaneously, an extension request will be considered untimely if it is filed after 10:00 a.m. ET on the due date. Under certain circumstances, Commerce may elect to specify a different time limit by which extension requests will be considered untimely for submissions which are due from multiple parties simultaneously. In such a case, we will inform parties in a letter or memorandum of the deadline (including a specified time) by which extension requests must be filed to be considered timely. An extension request must be made in a separate, standalone submission; under limited circumstances we will grant untimely filed requests for the extension of time limits, where we determine, based on 19 CFR 351.302, that extraordinary circumstances exist. Parties should review Commerce's regulations concerning the extension of time limits and the Time Limits Final Rule prior to submitting factual information in this investigation.^[35]

Certification Requirements

Any party submitting factual information in an AD or CVD proceeding must certify to the accuracy and completeness of that information.^[36] Parties must use the certification formats provided in 19 CFR 351.303(g).^[37] Commerce intends to reject factual submissions if the submitting party does not comply with the applicable certification requirements.

Notification to Interested Parties

Interested parties must submit applications for disclosure under APO in accordance with 19 CFR 351.305. Parties wishing to participate in this investigation should ensure that they meet the requirements of 19 CFR 351.103(d) ( e.g., by filing the required letters of appearance). Note that Commerce has amended certain of its requirements pertaining to the service of documents in 19 CFR 351.303(f).^[38]

This notice is issued and published pursuant to sections 702 and 777(i) of the Act, and 19 CFR 351.203(c).

Dated: January 6, 2025.

Steven Presing,

Acting Deputy Assistant Secretary for Policy and Negotiations.

Appendix

Scope of the Investigation

The merchandise covered by this investigation is sol gel alumina-based ceramic abrasive grains which are comprised of minimum 94% aluminum oxide (Al₂ O₃), and may contain other compounds, including, but not limited to, titanium dioxide, silicon dioxide, calcium oxide, sodium superoxide, ferric oxide, magnesium oxide, di-aluminum magnesium tetroxide, lanthanum oxide, lanthanum magnesium oxide, zirconium dioxide, or zirconium carbonate. Grain sizes of sol gel alumina-based ceramic abrasive grains range from 0.85 mm to 0.0395 mm (which corresponds to American National Standards Institute (ANSI) grit sizes from 20 to 280).

Shapes include but are not limited to angular, sharp, extra sharp, blocky, splintery, round stripped, triangular or shaped like extruded rods or stars.

Ceramic abrasive grains have unique crystalline structures that impart certain advanced properties, such as their extreme hardness and strength ranging between 16 and 22 gigapascals by the Vickers Diamond Indent Method, high melting point (2050 °C), and a single- or multi-phase microstructure, which may contain multiple phases, having crystalline sizes ranging from 0.05 to 30µm. These ceramic abrasive grains include but are not limited to blue, white, white-translucent, or off-white opaque colors.

Sol gel alumina-based ceramic abrasive grains are covered by the scope of this investigation, whether or not incorporated into downstream articles, including but not limited to, abrasive papers, grinding wheels, grinding cylinders, and grinding discs. When incorporated into downstream articles, only the sol gel alumina-based ceramic abrasive grains component of such articles is covered by the product scope, and not the downstream product as a whole.

The merchandise subject to this investigation is properly classified under subheadings 2818.10.2020 and 2818.10.2090 of the Harmonized Tariff Schedule of the United States (HTSUS). Other merchandise subject to the current scope, including when incorporated into the abovementioned downstream articles, may be classified under HTSUS subheadings 2818.10.1000, 2818.20.0000, 2818.30.0000, 3824.99.1100, 3824.99.1900, 6805.10.0000, 6805.20.0000, 6805.30.1000, 6805.30.5000, 6804.22.1000, 6804.22.4000, 6804.22.6000, 8204.12.0000, 8474.90.0010, 8474.90.0020, 8474.90.0050, ( print page 3179) and 8474.90.0090. Although the HTSUS statistical reporting numbers are provided for convenience and customs purposes, the written description of the merchandise is dispositive.

Footnotes

1.   See Petitioner's Letter, “Petitions for the Imposition of Antidumping and Countervailing Duties,” dated November 25, 2024 (Petition).

2.   Id.

3.   See Commerce's Letters, “Supplemental Questions,” dated November 27, 2024 (General Issues Questionnaire); “Supplemental Questions,” dated November 27, 2024; and “Supplemental Questions,” dated December 17, 2024; see also Memorandum, “Phone Call with Counsel to the Petitioner,” dated December 6, 2024 (December 6, 2024, Memorandum).

4.   See Petitioner's Letters, “Antidumping and Countervailing Supplemental Questionnaire Response,” dated December 4, 2024 (General Issues Supplement); “Countervailing Supplemental Questionnaire Response,” dated December 4, 2024; “Antidumping and Countervailing General Issues Supplement Response,” dated December 9, 2024 (Scope Supplement); and “Antidumping and Countervailing Supplemental Questionnaire Response,” dated December 23, 2024.

5.   See Notice of Extension of the Deadline for Determining the Adequacy of the Antidumping and Countervailing Duty Petitions: Sol Gel Alumina-Based Ceramic Abrasive Grains from the People's Republic of China,89 FR 100465 (December 12, 2024) ( Initiation Extension Notice).

6.   See section on “Determination of Industry Support for the Petition,” infra.

7.   See19 CFR 351.204(b)(2).

8.   See General Issues Questionnaire; see also December 6, 2024, Memorandum.

9.   See General Issues Supplement at 1-3; see also Scope Supplement at 4-5.

10.   See Antidumping Duties; Countervailing Duties; Final Rule,62 FR 27296, 27323 (May 19, 1997) ( Preamble).

11.   See19 CFR 351.102(b)(21) (defining “factual information”).

12.   See19 CFR 351.303(b)(1). The deadline for scope comments falls on January 26, 2025, which is a Sunday. In accordance with 19 CFR 351.303(b)(1), Commerce will accept comments filed by 5:00 p.m. ET on January 27, 2025 (“For both electronically filed and manually filed documents, if the applicable due date falls on a non-business day, the Secretary will accept documents that are filed on the next business day.”).

13.   See Antidumping and Countervailing Duty Proceedings: Electronic Filing Procedures; Administrative Protective Order Procedures,76 FR 39263 (July 6, 2011); see also Enforcement and Compliance; Change of Electronic Filing System Name,79 FR 69046 (November 20, 2014), for details of Commerce's electronic filing requirements, effective August 5, 2011. Information on using ACCESS can be found at https://access.trade.gov/​help.aspx and a handbook can be found at https://access.trade.gov/​help/​Handbook_​on_​Electronic_​Filing_​Procedures.pdf.

14.   See Commerce's Letter, “Invitation for Consultation to Discuss the Countervailing Duty Petition,” dated November 26, 2024.

15.  The GOC submitted comments on the CVD petition. See GOC's Letter, “Comments on Countervailing Duty Petition,” dated December 13, 2024.

16.   See section 771(10) of the Act.

17.   See USEC, Inc. v. United States, 132 F. Supp. 2d 1, 8 (CIT 2001) (citing Algoma Steel Corp., Ltd. v. United States, 688 F. Supp. 639, 644 (CIT 1988), aff'd Algoma Steel Corp., Ltd. v. United States, 865 F.2d 240 (Fed. Cir. 1989)).

18.  For a discussion of the domestic like product analysis as applied to this case and information regarding industry support, see Checklist, “Countervailing Duty Investigation Initiation Checklist: Sol Gel Alumina-Based Ceramic Abrasive Grains from the People's Republic of China,” dated concurrently with, and hereby adopted by, this notice (China CVD Initiation Checklist), at Attachment II, Analysis of Industry Support for the Antidumping and Countervailing Duty Petitions Covering Sol Gel Alumina-Based Ceramic Abrasive Grains from the People's Republic of China (Attachment II). This checklist is on file electronically via ACCESS.

19.   See Attachment II of the China CVD Initiation Checklist.

20.   See Initiation Extension Notice.

21.   See Commerce's Letters, “Polling Questionnaire,” dated December 10, 2024; see also Memorandum, “Email to Counsel for Domestic Producers,” dated December 23, 2024.

22.   See Petitioner's Letter, “Polling Questionnaire Response,” dated December 17, 2024; see also 3M Company's Letter, “Industry Polling Questionnaire Response,” dated December 17, 2024.

23.   See Attachment II of the China CVD Initiation Checklist.

24.   Id.

25.  For further information regarding negligibility and the injury allegation, see China CVD Initiation Checklist at Attachment III, Analysis of Allegations and Evidence of Material Injury and Causation for the Antidumping and Countervailing Duty Petitions Covering Sol Gel Alumina-Based Ceramic Abrasive Grains from the People's Republic of China (Attachment III).

26.   Id.

27.   Id.

28.   See Petition at Volume I (Exhibit I-5); see also General Issues Supplement at 1 and Exhibit I-5-Revised.

29.   See Memorandum, “Release of U.S. Customs and Border Protection Entry Data,” dated January 2, 2025.

30.   See section 703(a) of the Act.

31.   Id.

32.   See19 CFR 351.301(b).

33.   See19 CFR 351.301(b)(2).

34.   See19 CFR 351.302.

35.   See19 CFR 351.301; see also Extension of Time Limits; Final Rule,78 FR 57790 (September 20, 2013) ( Time Limits Final Rule), available at https://www.gpo.gov/​fdsys/​pkg/​FR-2013-09-20/​html/​2013-22853.htm.

36.   See section 782(b) of the Act.

37.   See Certification of Factual Information to Import Administration During Antidumping and Countervailing Duty Proceedings,78 FR 42678 (July 17, 2013) ( Final Rule); see also frequently asked questions regarding the Final Rule, available at https://enforcement.trade.gov/​tlei/​notices/​factual_​info_​final_​rule_​FAQ_​07172013.pdf.

38.   See Administrative Protective Order, Service, and Other Procedures in Antidumping and Countervailing Duty Proceedings,88 FR 67069 (September 29, 2023).