[Federal Register Volume 63, Number 11 (Friday, January 16, 1998)]
[Notices]
[Pages 2661-2664]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-1157]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-351-820]
Ferrosilicon From Brazil: Notice of Partial Termination and
Preliminary Results of Antidumping Duty Administrative Review
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
ACTION: Notice of Preliminary Results of Antidumping Duty
Administrative Review.
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SUMMARY: In response to timely requests for administrative review, the
Department of Commerce has conducted an administrative review of the
antidumping duty order on ferrosilicon from Brazil. Because we
determined that Companhia Brasileria Carbureto de Calcio had no
shipment of the subject merchandise, we are terminating this review
with regard to that firm. This notice of preliminary results covers one
manufacturer/exporter, Companhia de Ferro Ligas da Bahia, for the
period March 1, 1996, through February 28, 1997. The review indicates
that there was no dumping margin during this period. If these
preliminary results are adopted for purposes of the final results of
our administrative review, we will instruct the Customs Service to
assess antidumping duties of zero on entries during the period of
review. Interested parties are invited to comment on these preliminary
results. Parties who submit arguments in this proceeding are requested
to submit with the arguments (1) a statement of the issues, and (2) a
brief summary of each argument.
EFFECTIVE DATE: January 16, 1998.
FOR FURTHER INFORMATION CONTACT: Wendy Frankel or Sal Tauhidi, AD/CVD
Enforcement Group II, Office Four, Import Administration, International
Trade Administration, U.S. Department of Commerce, 14th Street and
Constitution Avenue, N.W., Washington, D.C. 20230; telephone: (202)
482-5849 or (202) 482-4851, respectively.
SUPPLEMENTAL INFORMATION:
The Applicable Statute and Regulations
Unless otherwise indicated, all citations to the Tariff Act of
1930, as amended (the Act) are references to the provisions effective
January 1, 1995, the effective date of the amendments to the Act by the
Uruguay Round Agreements Act (URAA). In addition, unless otherwise
indicated, all references to the Department of Commerce's (the
Department's) regulations are to the regulations as codified at 19 CFR
Part 353 (1997). Where appropriate, we have cited the Department's new
regulations, codified at 19 CFR Part 351 (62 FR 27296, May 19, 1997).
While not binding on this review, the new regulations serve as a
restatement of the Department's policies.
Background
On March 7, 1997 (62 FR 10521), the Department published in the
Federal Register a notice of ``Opportunity to Request an Administrative
Review'' of the antidumping duty order on Ferrosilicon from Brazil
covering the period March 1, 1996, through February 28, 1997. In
accordance with 19 CFR 353.22(a)(2), in March 1997, Companhia de Ferro
Ligas da Bahia (Ferbasa), Companhia Brasileira Carbureto De Calcio
(CBCC), and Companhia Ferroligas Minas Gerais (Minasligas) requested
that the Department conduct an administrative review of their
respective shipments of ferrosilicon to the United States during this
period. On April 24, 1997, the Department published a notice of
initiation of administrative review (62 FR 19988). The Department is
now conducting this administrative review in accordance with section
751 of the Act.
On May 14, 1997, the Department issued an antidumping duty
questionnaire to Ferbasa, CBCC, and Minasligas. On June 20, 1997, CBCC
submitted a letter to the Department stating that it had no shipments
or sales of the subject merchandise to the United States during the
period of review (POR). On June 25, 1997, we requested the Customs
Service (Customs) to confirm that CBCC had no shipments of the subject
merchandise during the POR. On June 27, 1997, Customs did so.
Therefore, because we determined that CBCC had no shipments of the
subject merchandise during the POR, we are terminating this review with
respect to CBCC. Further, on July 7, 1997, Minasligas requested that it
be allowed to withdraw its request for review and that the review be
terminated pursuant to 19 CFR 353.22(a)(5). On July 29, 1997, the
Department published a partial termination notice of the administrative
review on ferrosilicon from Brazil with respect to Minasligas. (See
Ferrosilicon From Brazil: Partial Termination of Antidumping Duty
Administrative Review (62 FR 40501) (July 29, 1997).)
Ferbasa submitted its response to the questionnaire on July 11,
1997. The Department issued supplemental questionnaires on August 13,
1997, and October 14, 1997. We received Ferbasa's
[[Page 2662]]
responses to the supplemental questionnaires on September 2, 1997, and
October 24, 1997, respectively. Under section 751(a)(3)(A) of the Act,
the Department may extend the deadline for completion of a preliminary
determination if it determines that it is not practicable to complete
the review within the statutory time limit. On September 15, 1997, the
Department published an extension of the time limits for the
preliminary results. (See Ferrosilicon from Brazil: Extension of Time
Limits of Antidumping Duty Administrative Review, (62 FR 48218).)
Verification
In accordance with section 782(i) of the Act, we verified the sales
and cost questionnaire responses of Ferbasa from November 3, 1997 to
November 11, 1997. We conducted verification of home market and U.S.
sales information provided by Ferbasa using standard verification
procedures, including on-site inspection of the company's sales and
production facility, the examination of relevant sales and financial
records, and original documentation containing relevant information.
Scope of Review
The merchandise subject to this review is ferrosilicon, a ferro
alloy generally containing, by weight, not less than four percent iron,
more than eight percent but not more than 96 percent silicon, not more
than 10 percent chromium, not more than 30 percent manganese, not more
than three percent phosphorous, less than 2.75 percent magnesium, and
not more than 10 percent calcium or any other element. Ferrosilicon is
a ferro alloy produced by combining silicon and iron through smelting
in a submerged-arc furnace. Ferrosilicon is used primarily as an
alloying agent in the production of steel and cast iron. It is also
used in the steel industry as a deoxidizer and a reducing agent, and by
cast iron producers as an inoculant.
Ferrosilicon is differentiated by size and by grade. The sizes
express the maximum and minimum dimensions of the lumps of ferrosilicon
found in a given shipment. Ferrosilicon grades are defined by the
percentages by weight of contained silicon and other minor elements.
Ferrosilicon is most commonly sold to the iron and steel industries in
standard grades of 75 percent and 50 percent ferrosilicon. Calcium
silicon, ferrocalcium silicon, and magnesium ferrosilicon are
specifically excluded from the scope of this review. Calcium silicon is
an alloy containing, by weight, not more than five percent iron, 60 to
65 percent silicon, and 28 to 32 percent calcium. Ferrocalcium silicon
is a ferro alloy containing, by weight, not less than four percent
iron, 60 to 65 percent silicon, and more than 10 percent calcium.
Magnesium ferrosilicon is a ferro alloy containing, by weight, not less
than four percent iron, not more than 55 percent silicon, and not less
than 2.75 percent magnesium. Ferrosilicon is currently classifiable
under the following subheadings of the Harmonized Tariff Schedule of
the United States (HTSUS): 7202.21.1000, 7202.21.5000, 7202.21.7500,
7202.21.9000, 7202.29.0010, and 7202.29.0050. The HTSUS subheadings are
provided for convenience and customs purposes. Our written description
of the scope of this review is dispositive.
Ferrosilicon in the form of slag is included within the scope of
this order if it meets, in general, the chemical content definition
stated above and is capable of being used as ferrosilicon. Parties that
believe their importations of ferrosilicon slag do not meet these
definitions should contact the Department and request a scope
determination.
Product Comparisons
In accordance with section 771(16) of the Act, we considered all
products produced by Ferbasa, covered by the description in the ``Scope
of the Review'' section, above, and sold in the home market during the
POR, to be foreign like products for purposes of determining
appropriate product comparisons to the U.S. sale. During the month of
the U.S. sale, Ferbasa had home market sales of identical merchandise;
therefore, pursuant to section 771(16) of the Act we used those sales
for comparison purposes and made no adjustments for differences in
merchandise.
Level of Trade
In accordance with section 773(a)(1)(B) of the Act, to the extent
practicable, we determine normal value (NV) based on sales in the
comparison market at the same level of trade (LOT) as the export price
(EP) or constructed export price (CEP) transaction. The NV LOT is that
of the starting-price sales in the comparison market or, when NV is
based on constructed value (CV), that of the sales from which we derive
selling, general and administrative (SG&A) expenses and profit. For EP,
the U.S. LOT is also the level of the starting-price sale, which is
usually from exporter to importer. For CEP, it is the level of the
constructed sale from the exporter to the importer.
To determine whether NV sales are at a different LOT than EP or
CEP, we examine stages in the marketing process and selling functions
along the chain of distribution between the producer and the
unaffiliated customer. If the comparison-market sales are at a
different LOT, and the difference affects price comparability, as
manifested in a pattern of consistent price differences between the
sales on which NV is based and comparison-market sales at the LOT of
the export transaction, we make an LOT adjustment under section
773(a)(7)(A) of the Act. Finally, for CEP sales, if the NV level is
more remote from the factory than the CEP level and there is no basis
for determining whether the difference in the levels between NV and CEP
affects price comparability, we adjust NV under section 773(a)(7)(B) of
the Act (the CEP offset provision). See Notice of Final Determination
of Sales at Less Than Fair Value: Certain Cut-to-Length Carbon Steel
Plate from South Africa, 62 FR 61731 (November 19, 1997).
In implementing these principles in this review, we obtained
information from Ferbasa regarding the marketing stages involved in the
reported home market and U.S. sales, including a description of the
selling activities performed by Ferbasa for each channel of
distribution. Pursuant to section 773(a)(1)(B)(i) of the Act and the
SAA at 827, in identifying levels of trade for EP and home market sales
we considered the selling functions reflected in the starting prices
before any adjustments. Ferbasa made only one U.S. sale during the
period of review, which was to an unaffiliated reseller in the U.S.
market. It made sales to unaffiliated resellers and to steel producers
in the home market. The selling functions for the U.S. sale and for all
home market sales are almost identical. The selling functions include
invoicing, order acknowledgment, order processing, quality control,
marketing, and price negotiation. With regard to the U.S. sale, Ferbasa
also incurred freight expenses for movement of the subject merchandise
from the factory to the port of embarkation. This does not represent a
significant difference in selling functions. Thus, based on our
analysis of the selling functions performed by Ferbasa, we conclude
that a single level of trade exists in each market and that home market
sales and the U.S. sale were all made at the same level of trade.
Therefore, we have not made a level of trade adjustment because the
price comparison is at the same level of trade and an adjustment
pursuant to section
[[Page 2663]]
773(a)(7)(A) of the Act is not appropriate.
Export Price
We calculated EP, in accordance with subsections 772(a) and (c) of
the Act, because the subject merchandise was sold directly to the first
unaffiliated purchaser in the United States prior to importation and
constructed export price was not otherwise warranted based on the facts
of record. We calculated EP based on the packed FOB prices to Ferbasa's
unaffiliated customer in the United States. In accordance with section
772(c)(2)(A) of the Act, we made deductions, where appropriate, for
foreign inland freight from the plant to the port and for brokerage and
handling, because these expenses were incident to bringing the subject
merchandise from the original place of shipment in the exporting
country to the place of delivery. No other adjustments to EP were
claimed or allowed.
Normal Value
Viability
In order to determine whether there was a sufficient volume of
sales in the home market to serve as a viable basis for calculating NV,
we compared Ferbasa's volume of home market sales of foreign like
product to the volume of U.S. sales of the subject merchandise in
accordance with section 773(a)(1)(C)(ii) of the Act. Since the
aggregate volume of home market sales of the foreign like product was
greater than five percent of the aggregate volume of U.S. sales of the
subject merchandise, we determined that the home market was viable for
Ferbasa. Therefore, in accordance with section 773(a)(1)(B)(i) of the
Act, we based NV on the prices at which the foreign like products were
first sold for consumption in the exporting country. We calculated NV
as noted in the ``Price-to-Price Comparisons'' section of this notice,
below.
Cost of Production (COP) Analysis
Because we disregarded sales below the COP in the last completed
segment of the proceeding for Ferbasa (i.e., Ferrosilicon from Brazil;
Final Results of Administrative Review (61 FR 59407) (November 22,
1996)), we had reasonable grounds to believe or suspect that sales of
the foreign product under consideration for the determination of NV in
this review may have been made at prices below the COP, as provided by
section 773(b)(2)(A)(ii) of the Act. Therefore, pursuant to section
773(b)(1) of the Act, we initiated a COP investigation of sales by
Ferbasa in the home market.
1. Calculation of COP
In accordance with section 773(b)(3) of the Act, we calculated the
COP based on the sum of Ferbasa's cost of materials and fabrication
employed in producing the foreign like product, plus amounts for
general and administrative expenses (G&A). We adjusted Ferbasa's
reported costs to calculate the cost of manufacturing for the months
corresponding to the company's sales reporting period. We further
adjusted Ferbasa's reported net interest expense calculations to
account for certain items of income or expense that were improperly
excluded or included in the company's calculation.
2. Net Home Market Prices for Comparison to COP
We calculated net price by reducing the gross unit price by amounts
for IPI and ICMS taxes, indirect selling expenses, home market packing
expenses, direct selling expenses, and billing adjustments. We also
made upward adjustments to the home market prices for interest revenue
and packing revenue earned by Ferbasa. We adjusted Ferbasa's reported
home market packing costs for errors found at verification.
3. Test of Home Market Prices
We used Ferbasa's weighted-average COP, as adjusted (see above),
for the period September 1996, through February 1997. We compared the
weighted-average COP figure to the net home-market sales prices (see
above) of the foreign like product as required under section 773(b) of
the Act. In determining whether to disregard home market sales made at
prices below the COP, we examined whether (1) within an extended period
of time, such sales were made in substantial quantities, and (2) such
sales were made at prices which permitted the recovery of all costs
within a reasonable period of time. On a product-specific basis, we
compared the COP to the home market prices (which did not include value
added taxes) (VAT) less any applicable movement charges, discounts, and
rebates. Since the COP did not contain VAT, for purposes of our sales-
below-cost analysis, we used home market prices which were exclusive of
VAT.
4. Results of the COP Test
In accordance with section 773(b)(2)(C), where less than 20 percent
of Ferbasa's sales of ferrosilicon were at prices below the COP, we did
not disregard any below-cost sales of that product because we
determined that the below-cost sales were not made in ``substantial
quantities.'' Where 20 percent or more of Ferbasa's sales during the
POR were at prices less than the COP, we determined such sales to have
been made in ``substantial quantities'' within an extended period of
time in accordance with section 773(b)(2)(B) of the Act, and not at
prices which would permit recovery of all costs within a reasonable
period of time, in accordance with section 773(b)(2)(D) of the Act.
Therefore, we disregarded such below-cost sales of Ferbasa.
Fair Value Comparisons
To determine whether sales of ferrosilicon by Ferbasa to the United
States were made at less than fair value, we compared the EP to the NV,
as described in the ``Export Price'' and ``Normal Value'' sections of
this notice. In accordance with section 777A(d)(2) of the Act, we
calculated a monthly weighted-average price for NV and compared this to
the U.S. transaction.
Price to Price Comparisons
We based NV on the price at which the foreign like product was
first sold for consumption in the exporting country, in the usual
commercial quantities and in the ordinary course of trade, and at the
same level of trade as the export price, as defined by section
773(a)(1)(B)(i) of the Act. We increased NV by U.S. packing costs in
accordance with section 773(a)(6)(A) and reduced it by home market
packing costs and ICMS and IPI taxes in accordance with 773(a)(6)(B)
(i) and (iii) of the Act. We adjusted Ferbasa's reported U.S. and home
market packing costs to correct for errors found at verification. In
addition, we increased NV for packing revenue and interest revenue
earned by Ferbasa and decreased NV for billing adjustments reported by
Ferbasa. We made a circumstance of sale adjustment for credit expenses
under 773(a)(6)(C)(iii). Further, in accordance with 19 CFR
353.56(a)(2), we made an offset to NV for U.S. commissions. No other
adjustments to NV were claimed or allowed.
Currency Conversion
We made currency conversions in accordance with section 773(A) of
the Act. Currency conversions were made based on the rates certified by
the Federal Reserve Bank. Section 773(A) directs the Department to use
a daily exchange rate to convert foreign currencies into U.S. dollars
unless the daily rate involves a ``fluctuation.'' It is our practice to
find that a fluctuation exists when the daily exchange rate differs
from a benchmark rate by 2.25 percent. See Preliminary Results of
Antidumping Duty Administrative Review: Certain Welded Carbon Steel
[[Page 2664]]
Pipe and Tube from Turkey (61 FR 35188, 35192) (July 5, 1996). The
benchmark rate is defined as the rolling average of the rates for the
past 40 business days.
Preliminary Results of the Review
As a result of this review, we preliminarily determine that the
weighted-average dumping margin for Ferbasa is zero percent for the
period March 1, 1996, through February 28, 1997.
Parties to the proceeding may request disclosure within 5 days of
the date of publication of this notice. Any interested party may
request a hearing within 10 days of the date of publication. Any
hearing, if requested, will be held 44 days after the publication of
this notice, or the first workday thereafter. Interested parties are
invited to comment on the preliminary results. Parties who submit
arguments in this proceeding are requested to submit with each
argument: (1) A statement of the issue and (2) a brief summary of the
argument. All case briefs must be submitted within 30 days of the date
of publication of this notice. Rebuttal briefs, which are limited to
issues raised in the case briefs, may be filed not later than 37 days
after the date of publication. The Department will publish a notice of
the final results of this administrative review, which will include the
results of its analysis of issues raised in any such written comments
within 120 days from the publication of these preliminary results.
The Department shall determine, and Customs shall assess,
antidumping duties on all appropriate entries. Upon completion of this
review, the Department will issue appraisement instructions directly to
Customs. The final results of this review shall be the basis for the
assessment of antidumping duties on entries of merchandise covered by
the determination and for future deposits of estimated duties. For duty
assessment purposes, because this review covers only one importer, we
will divide the total dumping margin (calculated as the difference
between NV and EP) by the total number of metric tons imported. We will
direct Customs to assess the resulting per-metric ton dollar amount
against each metric ton of subject merchandise entered by the importer
during the POR. Furthermore, the following deposit requirements will be
effective upon completion of the final results of this administrative
review for all shipments of ferrosilicon from Brazil entered, or
withdrawn from warehouse, for consumption on or after the publication
date of the final results of this administrative review, as provided by
section 751(a)(1) of the Act: (1) The cash deposit rate for Ferbasa
will be the rate established in the final results of this
administrative review, except if the rate is less than 0.5 percent, ad
valorem and, therefore, de minimis within the meaning of 19 CFR 353.6,
the cash deposit rate will be zero; (2) for merchandise exported by
manufacturers or exporters not covered in this review but covered in
the original less than fair value (LTFV) investigation or a previous
review, the cash deposit rate will continue to be the company-specific
rate published in the most recent period; (3) if the exporter is not a
firm covered in this review, a previous review, or the LTFV
investigation, but the manufacturer is, the cash deposit rate will be
the rate established for the most recent period for the manufacturer of
the merchandise; (4) if neither the exporter nor the manufacturer is a
firm covered in this or any previous reviews, the cash deposit rate
will be 35.95 percent, the ``All Others'' rate made effective by the
antidumping duty order (59 FR 11769, March 14, 1994) and; (5)
consistent with our practice in previous reviews of this order, for
those companies that did not have shipments of the subject merchandise
during the POR but which had previously been reviewed or investigated,
their cash deposit rate will continue to be the company-specific rate
published for the most recently reviewed period. These requirements,
when imposed, shall remain in effect until publication of the final
results of the next administrative review.
This notice serves as a preliminary reminder to importers of their
responsibility under 19 CFR 353.26 to file a certificate regarding the
reimbursement of antidumping duties prior to liquidation of the
relevant entries during this review period. Failure to comply with this
requirement could result in the Secretary's presumption that
reimbursement of antidumping duties occurred and the subsequent
assessment of double antidumping duties.
This administrative review and notice are in accordance with
section 751(a)(1) of the Act (19 U.S.C. 1675(a)(1)) and 19 CFR 353.22.
Dated: January 12, 1998.
Robert S. LaRussa,
Assistant Secretary for Import Administration.
[FR Doc. 98-1157 Filed 1-15-98; 8:45 am]
BILLIGN CODE 3510-DS-P
