03-25281. Carbon and Certain Alloy Steel Wire Rod From Brazil, Canada, Indonesia, Mexico, Moldova, Trinidad and Tobago, and Ukraine: Preliminary Results of Changed Circumstances Review

AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

ACTION:

Notice of Preliminary Results of Changed Circumstances Review of the Antidumping Duty and Countervailing Duty Orders, and Intent To Revoke Orders, in Part.

EFFECTIVE DATE:

October 6, 2003.

SUMMARY:

On August 21, 2003, the Department of Commerce (the Department) published a notice of initiation of a changed circumstances review with the intent to revoke, in part, the antidumping duty orders and countervailing duty orders on carbon and certain alloy steel wire rod, as described below. See Carbon and Certain Alloy Steel Wire Rod from Brazil, Canada, Indonesia, Mexico, Moldova, Trinidad and Tobago, and Ukraine: Initiation of Changed Circumstances Antidumping Duty Administrative Review and Countervailing Duty Administrative Reviews, and Intent To Revoke Orders in Part, 68 Fed. Reg. 50,513 (August 21, 2003) (Initiation Notice).

In our Initiation Notice we invited interested parties to comment. We did not receive comment concerning the technical description of the merchandise subject to this changed circumstances review. However, on August 22, 2003, petitioners¹ filed a letter stating the Initiation Notice contains an error in language with respect to the effective date of liquidation of entries because the Initiation Notice does not match the intent of petitioners' July 24, 2003 request for changed circumstances review. The Department has amended the effective date accordingly. Absent any other comments, we preliminarily conclude that producers accounting for substantially all of the production of the domestic like product to which these orders pertain lack interest in the relief provided by the order. Unless the Department receives opposition from domestic producers who's production totals more than 15 percent of the domestic like product, the Department will partially revoke the orders on carbon and certain alloy steel wire rod in its final results of this review. Therefore, we preliminarily revoke these orders, in part, with respect to products entered, or withdrawn from warehouse, for consumption on or after July 24, 2003 of carbon and certain alloy steel wire rod described below, because domestic parties have expressed no interest in the continuation of the orders on that merchandise.

FOR FURTHER INFORMATION CONTACT:

Brian J. Sheba or Robert M. James, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, N.W., Washington, D.C. 20230; telephone: [phone] or [phone].

SUPPLEMENTARY INFORMATION:

Background

The Department published the antidumping duty orders on steel wire rod from Brazil, Canada, Indonesia, Mexico, Moldova, Trinidad and Tobago, and Ukraine on October 29, 2002. See Notice of Antidumping Duty Orders: Carbon and Certain Alloy Steel Wire Rod From Brazil, Indonesia, Mexico, Moldova, Trinidad and Tobago, and Ukraine, 67 Fed. Reg. 65,945, and Notice of Amended Final Determination of Sales at Less Than Fair Value and Antidumping Duty Order: Carbon and Alloy Steel Wire Rod From Canada, 67 Fed. Reg. 65,944. The Department published the countervailing duty orders on steel wire rod from Brazil and Canada on October 22, 2002. See Notice of Countervailing Duty Orders: Carbon and Certain Alloy Steel Wire Rod From Brazil and Canada, 67 Fed. Reg. 64,871. On July 24, 2003, petitioners requested that the Department change the technical description of certain grade 1080 tire cord quality wire rod and grade 1080 tire bead quality wire rod (hereafter, tire cord wire rod). This request arises, petitioners aver, because the original definition of the excluded tire cord wire rod was drawn too narrowly and, thus, captures within the scope certain products petitioners no longer wish to have subject to the orders.

On August 21, 2003, the Department published a notice of initiation of a changed circumstances review of the antidumping duty and countervailing duty orders on carbon and certain alloy steel wire rod products. See Initiation Notice. In the Initiation Notice, we indicated interested parties could submit comments for consideration in the Department's preliminary results not later than 14 days after publication of the initiation of the review, and submit responses to those comments no later than 5 days following the submission of comments. On August 22, 2003, petitioners filed comments that stated the Initiation Notice contains an error in language with respect to the effective date of liquidation of entries because the Initiation Notice does not match the intent of petitioners.

The Initiation Notice stated:

If, as a result of this review, we revoke the order, in part, we intend to instruct the Bureau of Customs and Border Protection (Customs) to liquidate without regard to antidumping duties, as applicable, and to refund any estimated antidumping duties collected for all unliquidated entries of the tire cord wire rod products meeting the specifications indicated above, as of July 24, 2003, the date this changed circumstances review request was filed by Petitioners, in accordance with 19 CFR 351.222(g)(4).

Initiation Notice, 68 Fed. Reg. 50,513, at 50,515. Petitioners claim this language could be read to mean that all unliquidated entries existing as of July 24, 2003 will be subject to the terms of the changed scope. The phrase “as of July 24, 2003” could also be read to mean that entries made prior to July 24, 2003 that were subject to the original scope would now be excluded by the new scope exclusion language. Petitioners state such a result is contrary to the plain language of petitioners' request and not the intent of the Department's Initiation Notice. Petitioners did not otherwise comment on the scope of the orders. No other interested party commented on the Initiation Notice.

Scope of the Orders

The merchandise covered by these orders is certain hot-rolled products of carbon steel and alloy steel, in coils, of approximately round cross section, 5.00 mm or more, but less than 19.00 mm, in solid cross-sectional diameter.

Specifically excluded are steel products possessing the above-noted physical characteristics and meeting the Harmonized Tariff Schedule of the United States (HTSUS) definitions for (a) stainless steel; (b) tool steel; c) high nickel steel; (d) ball bearing steel; and (e) concrete reinforcing bars and rods. Also excluded are (f) free machining steel products (i.e., products that contain by weight one or more of the following elements: 0.03 percent or more of lead, 0.05 percent or more of bismuth, 0.08 percent or more of sulfur, more than 0.04 percent of phosphorus, more than 0.05 percent of selenium, or more than 0.01 percent of tellurium).

Also excluded from the scope are 1080 grade tire cord quality wire rod and 1080 grade tire bead quality wire rod. This grade 1080 tire cord quality rod is defined as: (i) grade 1080 tire cord quality wire rod measuring 5.0 mm or more but not more than 6.0 mm in cross-sectional diameter; (ii) with an average partial decarburization of no more than 70 microns in depth (maximum individual 200 microns); (iii) having no inclusions greater than 20 microns; (iv) having a carbon segregation per heat average of 3.0 or better using European Method NFA 04-114; (v) having a surface quality with no surface defects of a length greater than 0.15 mm; (vi) capable of being drawn to a diameter of 0.30 mm or less with 3 or fewer breaks per ton, and (vii) containing by weight the following elements in the proportions shown: (1) 0.78 percent or more of carbon, (2) less than 0.01 percent of aluminum, (3) 0.040 percent or less, in the aggregate, of phosphorus and sulfur, (4) 0.006 percent or less of nitrogen, and (5) not more than 0.15 percent, in the aggregate, of copper, nickel and chromium.

This grade 1080 tire bead quality rod is defined as: (i) grade 1080 tire bead quality wire rod measuring 5.5 mm or more but not more than 7.0 mm in cross-sectional diameter; (ii) with an average partial decarburization of no more than 70 microns in depth (maximum individual 200 microns); (iii) having no inclusions greater than 20 microns; (iv) having a carbon segregation per heat average of 3.0 or better using European Method NFA 04-114; (v) having a surface quality with no surface defects of a length greater than 0.2 mm; (vi) capable of being drawn to a diameter of 0.78 mm or larger with 0.5 or fewer breaks per ton; and (vii) containing by weight the following elements in the proportions shown: (1) 0.78 percent or more of carbon, (2) less than 0.01 percent of soluble aluminum, (3) 0.040 percent or less, in the aggregate, of phosphorus and sulfur, (4) 0.008 percent or less of nitrogen, and (5) either not more than 0.15 percent, in the aggregate, of copper, nickel and chromium (if chromium is not specified), or not more than 0.10 percent in the aggregate of copper and nickel and a chromium content of 0.24 to 0.30 percent (if chromium is specified).

The designation of the products as “tire cord quality” or “tire bead quality” indicates the acceptability of the product for use in the production of tire cord, tire bead, or wire for use in other rubber reinforcement applications such as hose wire. These quality designations are presumed to indicate that these products are being used in tire cord, tire bead, and other rubber reinforcement applications, and such merchandise intended for the tire cord, tire bead, or other rubber reinforcement applications is not included in the scope. However, should petitioners or other interested parties provide a reasonable basis to believe or suspect that there exists a pattern of importation of such products for other than those applications, end-use certification for the importation of such products may be required. Under such circumstances, only the importers of record would normally be required to certify the end use of the imported merchandise.

All products meeting the physical description of subject merchandise that are not specifically excluded are included in this scope.

The products under investigation are currently classifiable under subheadings 7213.91.3010, 7213.91.3090, 7213.91.4510, 7213.91.4590, 7213.91.6010, 7213.91.6090, 7213.99.0031, 7213.99.0038, 7213.99.0090, 7227.20.0010, 7227.20.0020, 7227.20.0090, 7227.20.0095, 7227.90.6051, 7227.90.6053, 7227.90.6058, and 7227.90.6059 of the HTSUS. Although the HTSUS subheadings are provided for convenience and customs purposes, the written description of the scope of this proceeding is dispositive.

Scope of Changed Circumstances Review

The products subject to this changed circumstances antidumping duty and countervailing duty administrative review are certain grade 1080 tire cord steel wire rod and grade 1080 tire bead steel wire rod. Point (iii) of the existing definition of these products reads: “having no inclusions greater than 20 microns.” Petitioners suggest amending this to read “having no non-deformable inclusions greater than 20 microns and no deformable inclusions greater than 35 microns.” Letter from petitioners dated July 24, 2003, at 5 (emphases in original).

Petitioners would then insert an explanatory paragraph after the existing definition of tire cord wire rod reading:

For purposes of the grade 1080 tire cord quality wire rod and the grade 1080 tire bead quality wire rod, an inclusion will be considered to be deformable if its ratio of length (measured along the axis - that is, the direction of rolling - of the rod) over thickness (measured on the same inclusion in a direction perpendicular to the axis of the rod) is equal to or greater than three. The size of an inclusion for purposes of the 20 microns and 35 microns limitations is the measurement of the largest dimension observed on a longitudinal section measured in a direction perpendicular to the axis of the rod.

Letter from petitioners dated August 6, 2003, at 6; original emphasis deleted.

Preliminary Results of Review and Intent to Revoke in Part the Antidumping Duty and Countervailing Duty Orders

Pursuant to sections 751(d)(1) of the Tariff Act, the Department may revoke an antidumping or countervailing duty order, in whole or in part, based on a review under section 751(b) of the Tariff Act (i.e., a changed circumstances review). Section 751(b)(1) of the Tariff Act requires a changed circumstances review to be conducted upon receipt of a request which shows changed circumstances sufficient to warrant a review. Section 782(h)(1) of the Tariff Act gives the Department the authority to revoke an order if producers accounting for substantially all of the production of the domestic like product have expressed a lack of interest in the continuation of the order. Section 351.222(g) of the Department's regulations provides that the Department will conduct a changed circumstances administrative review under 19 CFR 351.216, and may revoke an order (in whole or in part), if it concludes that (i) producers accounting for substantially all of the production of the domestic like product to which the order pertains have expressed a lack of interest in the relief provided by the order, in whole or in part, or (ii) if other changed circumstances sufficient to warrant revocation exist. Since the Department did not receive any comments during the comment period opposing the exclusion of certain grade 1080 tire cord quality wire rod and grade 1080 tire bead quality wire rod, as defined in the “Scope of Changed Circumstances Review” above, from the antidumping duty and countervailing duty orders, we preliminarily conclude that producers accounting for substantially all of the production of the domestic like product to which these orders pertain lack interest in the relief provided by the order. Unless the Department receives opposition from domestic producers who's production totals more than 15 percent of the domestic like product, the Department will partially revoke the orders on carbon and certain alloy steel wire rod in its final results of review. Therefore, the Department is preliminarily revoking the orders on carbon and certain alloy steel wire rod from Brazil, Canada, Indonesia, Mexico, Moldova, Trinidad and Tobago, and Ukraine, in part, for all entries after the date of the petitioners' request with regard to the products which meet the specifications above.

The Department has considered interested parties' comments concerning the effective date of liquidation of entries. As a result, we intend to instruct Customs to liquidate all entries of subject products entered for consumption on or after July 24, 2003, the effective date of the revocation, in part, of these orders, in accordance with 19 CFR 351.222(g)(4).

Interested parties wishing to comment on these preliminary results may submit briefs to the Department no later than 16 days after the publication of this notice in the Federal Register. Parties will have five days subsequent to this due date to submit rebuttal comments, limited to the issues raised in those comments. Parties who submit comments or rebuttal comments in this proceeding are requested to submit with the argument (1) a statement of the issue and (2) a brief summary of the argument (no longer than five pages, including footnotes). Any requests for hearing must be filed within 30 days of the publication of this notice in the Federal Register.

All written comments must be submitted in accordance with 19 CFR 351.303, with the exception that only three (3) copies for each case need be served on the Department. Any comments must also be served on all interested parties on the Department's service list. The Department will issue its final results of review as soon as practicable following the above comment period, but not later than 270 days after the date on which the changed circumstances review is initiated, in accordance with 19 CFR 351.216(e), and will publish these results in the Federal Register. While the changed circumstances review is underway, the current requirement for a cash deposit of estimated antidumping or countervailing duties on all subject merchandise, including the merchandise that is the subject of this changed circumstances review, will continue unless and until these orders are revoked, in part, pursuant to the final results of this changed circumstances review or an administrative review.

This notice is published in accordance with sections 751(b)(1) and 777(i)(1) of the Tariff Act and 19 CFR 351.216 and 351.222 of the Department's regulations.

Dated: September 29, 2003.

James J. Jochum,

Assistant Secretary for Import Administration.

Footnotes

1.  Petitioners are Georgetown Steel Co. (Formerly, GS Industries), North Star Steel Texas, Gerdau Ameristeel (formerly, Co-Steel Raritan), and Keystone Consolidated Industries.