[Federal Register Volume 60, Number 61 (Thursday, March 30, 1995)]
[Notices]
[Pages 16431-16437]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-7775]
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[[Page 16432]]
DEPARTMENT OF COMMERCE
International Trade Administration
[A-823-806]
Notice of Final Determination of Sales at Less Than Fair Value:
Pure Magnesium From Ukraine
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
EFFECTIVE DATE: March 30, 1995.
FOR FURTHER INFORMATION CONTACT:
Ellen Grebasch, Dorothy Tomaszewski or Erik Warga, Office of
Antidumping Investigations, Import Administration, International Trade
Administration, U.S. Department of Commerce, 14th Street and
Constitution Avenue, N.W., Washington, D.C. 20230; telephone: (202)
482-3773, (202) 482-0631 or (202) 482-0922, respectively.
Final Determination
We determine that imports of pure magnesium from Ukraine are being,
or are likely to be, sold in the United States at less than fair value
(``LTFV''), as provided in section 733 of the Tariff Act of 1930, as
amended (``the Act''). The estimated margins are shown in the
``Continuation of Suspension of Liquidation'' section of this notice.
Case History
Since the preliminary determination on October 27, 1994 (59 FR
55420, November 7, 1994), the following events have occurred:
In December 1994, we issued sections A and C of our antidumping
questionnaire\1\ to exporters Greenwich Metals and Hochschild Partners.
These companies provided responses to these questionnaires in December
1994 and January 1995.
\1\Section A requested general information on each company; and
section C requested information on, and a listing of, U.S. sales
made during the period of investigation (``POI'').
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Verifications were conducted at the Chicago, Illinois, facilities
of MG Metals from December 6 to December 7, 1994; at Gerald Metals'
Lausanne, Switzerland, offices from December 13 to December 14, 1994,
and at its Stamford, Conn., offices on January 24 and January 25, 1995;
at Concern Oriana's (formerly Concern Chlorvinyl) facilities in Kalush,
Ukraine; and at the Greenwich, Conn., facilities of Greenwich Metals
from January 30 to January 31, 1995.
On January 31, 1995, we amended our preliminary determination to
correct for certain ministerial errors (60 FR 7519, February 8, 1995).
Respondents Concern Oriana, Gerald Metals, Greenwich Metals,
Hochschild Partners, as well as petitioners,\2\ filed case and rebuttal
briefs. A public hearing was held on February 24, 1995.
\2\Magnesium Corporation of America; Dow Chemical; International
Union of Operating Engineers, Local 564; and United Steel Workers of
America, Local 8319.
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Scope of Investigation\3\
\3\The scope of this investigation has been modified since the
preliminary determination in order to clarify the distinctions
between pure magnesium and alloy magnesium. See Comment 5 in the
``Interested Party Comments'' section of this notice, below, for a
discussion of the scope modification. For a detailed definition of
alloy magnesium, see the ``Scope of Investigation'' section of the
concurrent investigations of alloy magnesium from the People's
Republic of China and the Russian Federation.
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The product covered by this investigation is pure primary magnesium
regardless of chemistry, form or size, unless expressly excluded from
the scope of this investigation. Primary magnesium is a metal or alloy
containing by weight primarily the element magnesium and produced by
decomposing raw materials into magnesium metal. Pure primary magnesium
is used primarily as a chemical in the aluminum alloying,
desulfurization, and chemical reduction industries. In addition, pure
primary magnesium is used as an input in producing magnesium alloy.
Pure primary magnesium encompasses:
(1) products that contain at least 99.95% primary magnesium, by
weight (generally referred to as ``ultra-pure'' magnesium);
(2) products containing less than 99.95% but not less than 99.8%
primary magnesium, by weight (generally referred to as ``pure''
magnesium); and
(3) products (generally referred to as ``off-specification
pure'' magnesium) that contain 50% or greater, but less than 99.8%
primary magnesium, by weight, and that do not conform to ASTM
specifications for alloy magnesium.
``Off-specification pure'' magnesium is pure primary magnesium
containing magnesium scrap, secondary magnesium, oxidized magnesium or
impurities (whether or not intentionally added) that cause the primary
magnesium content to all below 99.8% by weight. It generally does not
contain, individually or in combination, 1.5% or more, by weight, of
the following alloying elements: aluminum, manganese, zinc, silicon,
thorium, zirconium and rare earths.
Excluded from the scope of this investigation are alloy primary
magnesium, primary magnesium anodes, granular primary magnesium
(including turnings and powder), and secondary magnesium.
Granular magnesium, turnings, and powder are classifiable under
Harmonized Tariff Schedule of the United States (HTSUS) subheading
8104.30.00. Magnesium granules and turnings (also referred to as chips)
are produced by grinding and/or crushing primary magnesium and thus
have the same chemistry as primary magnesium. Although not susceptible
to precise measurement because of their irregular shapes, turnings or
chips are typically produced in coarse shapes and have a maximum length
of less than 1 inch. Although sometimes produced in larger sizes,
granules are more regularly shaped than turnings or chips, and have a
typical size of 2mm in diameter or smaller.
Powders are also produced from grinding and/or crushing primary
magnesium and have the same chemistry as primary magnesium, but are
even smaller than granules or turnings. Powders are defined by the
Section Notes to Section XV, the section of the HTSUS in which
subheading 8104.30.00 appears, as products of which 90 percent or more
by weight will pass through a sieve having a mesh aperture of 1mm. (See
HTSUS, Section XV Base Metals and Articles of Base Metals, Note 6(b).)
Accordingly, the exclusion of magnesium turnings, granules and powder
from the scope includes products having a maximum physical dimension
(i.e., length or diameter) of 1 inch or less.
The products subject to this investigation are classifiable under
subheadings 8104.11.00, 8104.19.00 and 8104.20.00 of the HTSUS.
Although the HTSUS subheadings are provided for convenience and customs
purposes, our written description of the scope is dispositive.
Period of Investigation
The period of investigation (``POI'') is October 1, 1993, through
March 31, 1994.
Fair Value Comparisons
A. Participating Respondents
To determine whether sales of pure magnesium from Ukraine to the
United States by Gerald Metals, Hochschild Partners, and MG Metals were
made at less than fair value, we compared the United States price
(``USP'') to the foreign market value (``FMV''), as specified in the
``United States Price'' and ``Foreign Market Value'' sections of this
notice.
Verification revealed that, for its POI sales to U.S. companies,
there were no instances where Greenwich Metals' role in the sales
process was that of being the [[Page 16433]] first company to sell
Ukraine-produced pure magnesium to a U.S. customer. That is, all
subject merchandise purchased by Greenwich was done so on terms that
made Greenwich the U.S. customer of its supplier. Accordingly,
Greenwich will be subject to the ``Ukraine-wide'' deposit rate.
B. All Other Companies
All companies to which a questionnaire was issued are considered
mandatory respondents in this proceeding. Several companies in Ukraine
either failed to respond to either our initial requests for information
about U.S. sales, or failed to respond to our request for permission to
verify. These companies include: Zaporozhye Titanium-Magnesium Plant, a
Ukrainian producer; and Alex, Mages, and Intreid, Ukrainian exporters.
Accordingly, we have based the ``Ukraine-wide'' duty deposit rate--
applicable to all companies except those that (1) made POI U.S. sales
of subject merchandise, and (2), participated in this investigation--on
the best information available (``BIA'').
In determining what to use as BIA, the Department follows a two-
tiered methodology, whereby the Department normally assigns lower
margins to respondents that cooperated in an investigation and margins
based on more adverse assumptions for those respondents, like the non-
participating respondents in this investigation, which did not
cooperate in an investigation. As outlined in Coumarin,\4\ where, as
here, a company refuses to provide the information requested in the
form required, or otherwise significantly impedes the Department's
investigation, it is appropriate for the Department to assign to that
company the higher of (1) the highest calculated rate of any respondent
in the investigation, (2) the highest margin alleged in the petition,
or (3) the margin from the preliminary determination for that firm.
Accordingly, we have set the Ukraine-wide deposit rate at 104.27
percent, ad valorem. This margin represents the highest margin in the
petition, as recalculated by the Department for purposes of initiating
this proceeding and as further adjusted to account for factors of
production listed in the petition that were not valued at the time of
initiation, but for which information is on the record upon which to
base a surrogate value.
\4\Final Determination of Sales at Less Than Fair Value:
Coumarin from the People's Republic of China (59 FR 66895, December
28, 1994).
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United States Price
We based USP for third-country exporters Gerald Metals and
Hochschild on purchase price, in accordance with section 772(b) of the
Act, because the subject merchandise was sold directly by the exporters
to unrelated parties in the United States prior to importation into the
United States and because exporter's sales price (``ESP'') methodology
was not indicated by other circumstances.
For Gerald Metals and Hochschild, we calculated purchase price
based on packed, CIF, delivered, or FOT warehouse prices to unrelated
purchasers in the United States. For Gerald Metals, we made the
following deductions (where appropriate): ocean freight; foreign
brokerage; U.S. Brokerage and handling charges; U.S. duty; and U.S.
inland freight. For Hochschild Partners, we made the following
deductions (where appropriate) for foreign brokerage; ocean freight;
marine insurance; and U.S. inland freight.
We based USP for MG Metals, a third-country exporter, on ESP, in
accordance with section 772(c) of the Act, because the subject
merchandise was sold to the first unrelated purchaser after importation
into the United States.
We calculated ESP based on packed delivered prices. For MG Metals,
we made the following deductions (where appropriate) for ocean freight;
marine insurance; foreign brokerage; U.S. inland freight; U.S. inland
insurance, U.S. duties; U.S. brokerage and handling; and additional
packing costs.
From each exporter's U.S. price, we continued to deduct foreign
inland freight between the factory and the reported intermediate
destination (e.g., Rotterdam) using the per-ton foreign inland freight
figure reported in the petition in order to account for this movement
charge from producer to the intermediate destination.
Minor adjustments were made to the reported U.S. sales of these
exporters pursuant to our findings at verification (see Final
Calculation Memorandum, on file in room B-099 of the Main Commerce
Department Building, for details of adjustments).
Foreign Market Value
A. Surrogate Country Selection
Section 773(c) of the Act requires the Department to value the
factors of production, to the extent possible, in one or more market
economy countries that are at a level of economic development
comparable to that of the non-market-economy country and that are
significant producers of comparable merchandise.
In our preliminary determination, we selected Indonesia as our
primary surrogate country and resorted to Egypt for certain surrogate
values where values in Indonesia were either unavailable or out of
date. These countries are appropriate surrogate countries for the
reasons set forth in our preliminary determination. Since we find no
compelling reason to change this selection, we have continued to base
FMV on the values of the appropriate factors of production as valued in
Indonesia or Egypt.
B. Factors of Production
In accordance with section 773(c) of the Act, we calculated FMV,
with regard to the exporters' U.S. sales of magnesium produced by
Concern Oriana, based on factors of production cited in the preliminary
determination, making adjustments based on verification findings (see
Final Calculation Memorandum). With regard to the exporters' U.S. sales
of magnesium produced by the other Ukraine manufacturer. Zaporozhye
Titanium-Magnesium Plant (from which we did not receive factors of
production data), we did not calculate FMV; instead, we assigned an
uncooperative BIA margin which equalled the highest adjusted alleged
margin cited in our initiation notice (as indicated in our amended
preliminary determination).
The factors used to produce pure magnesium include materials,
labor, and energy. To calculate FMV, the reported quantities were
multiplied by the appropriate surrogate values for the different
inputs. (For a complete analysis of surrogate values, see our Final
Calculation Memorandum.) An imputed factory overhead figure was also
included in the FMV calculation based on a percentage of materials,
labor and energy. We granted a by-product offset against the cost of
manufacturing (i.e., the sum of materials, labor, energy and factory
overhead). We then added the statutory minimum imputed amounts for
general expenses and profit. We followed the same methodology for
packing costs used at the preliminary determination; however, adjusted
the packing material cost so as not to double count certain materials.
Additionally, we used the Indonesian unskilled labor rate for packing
labor.
We have used the same surrogate values used in the preliminary
determination with the exception of certain corrections made based on
verification or interested party comments. Based on verification, we
adjusted the values of magnesium [[Page 16434]] chloride and chlorine
to reflect the actual purity used in the production (or yielded as a
by-product) of subject merchandise. We recalculated certain reported
inland freight distances between factory and input supplier based on
verified distances. We used labor rates from Indonesia specific to
skilled and unskilled labor. One material input, considered a direct
material for the preliminary determination, has not been accounted for
in our final determination because it was discovered at verification to
be an indirect material.
Verification
As provided in Section 776(b) of the Act, we verified the
information submitted by respondents for use in our final
determination. We used standard verification procedures, including
examination of relevant accounting and production records and original
source documents provided by respondents.
Interested Party Comments
Comment 1: BIA for Refusal to Permit Verification
Petitioners argue that the Department should assign a margin based
on total BIA to all companies that reported having made no POI sales of
subject merchandise, but that did not indicate in their response to the
Department's inquiry that they would permit verification of this
information.
DOC Position
We agree with petitioners and have assigned a margin based on total
BIA to those companies that either refused verification or did not
respond to our request to verify a report of no sales.
Comment 2: Surrogate Value for Magnesium Chloride
Concern Oriana asserts that the surrogate value used for magnesium
chloride in the preliminary determination was aberrational and
unrealistic because: (1) The surrogate value is almost five times
greater on a per-unit basis than the Brazil value of hydrated
carnallite provided in the petition, of which magnesium chloride is but
one cost component; (2) the UN Trade Commodity Statistics show an
export value for Indonesia which is one third that of the import value;
and (3) values for imports of magnesium chloride into other potential
surrogate countries vary more than 500 percent, demonstrating that the
value used for the preliminary determination is inherently unreliable.
Concern Oriana requests that the Department use the value of
hydrated carnallite from the petition as a more realistic and accurate
surrogate for the value of magnesium chloride used in the production of
magnesium.
Petitioners counter that the Department should not use a surrogate
value for hydrated carnallite, a completely different material, when a
nonaberrational price is available for a commodity category containing
the actual materials used in the production process. Specifically,
petitioners contend that the Indonesian price for magnesium chloride
and the petition's price for hydrated carnallite cannot be compared.
Petitioners also contend that the range of import prices for magnesium
chloride from other potential surrogate countries ($159 to $1,000/per
metric ton) demonstrates that the price used in the preliminary
determination ($152.89 per metric ton) is conservative rather than
aberrational. Petitioners note as well that the Indonesian import price
fits into the high preference category of the Department's hierarchy
for surrogate values: it is publicly available information, it is non-
export value, and it is contemporaneous to the POI, unlike the petition
value for a totally different product suggested by respondents.
DOC Position
We agree with petitioners that the record does not support a
finding that the surrogate value for magnesium chloride is aberrational
or otherwise inappropriate. First, it is not accurate to characterize
magnesium chloride as ``but one cost component'' of hydrated
carnallite. The fact that hydrated carnallite is processed to obtain
magnesium chloride (rather than vice versa) makes a higher price for
magnesium chloride logical. Second, although import prices in other
surrogate countries vary, Concern Oriana has not demonstrated that this
variance should be construed as evidence that the value used here is
unreliable. Third, we have specifically expressed a preference for
import values over export values when both are available (see PRC
Pencils\5\).
\5\Notice of Final Determination of Sales at Less Than Fair
Value: Certain Cased Pencils from the People's Republic of China (60
FR 55625, November 8, 1994)
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Comment 3: Basis for Greenwich Metals' Deposit Rate
Petitioners assert that verification revealed that Greenwich's
reported U.S. sales of subject merchandise were entirely of merchandise
that it had purchased from a European trader that was aware that the
merchandise was destined for the United States. Consequently,
petitioners request that the Department assign Greenwich the ``Ukraine-
wide'' rate and assign the European trader the BIA rate for not
participating in this investigation.
Greenwich counters that it properly reported the sales in question
as its own U.S. sales. Greenwich argues that the European trader did
not know the ultimate destination of the merchandise because Greenwich
did not inform the European trader where to ship the merchandise until
after the terms of sale were fixed. Greenwich also argues that the
European trader did not know the ultimate destination of subject
merchandise at the time the terms of the sale were fixed because
Greenwich bought the merchandise on a ``duty-unpaid'' basis--leaving
Greenwich the option of selling the merchandise in either the U.S.
market or in a third country.
DOC Position
We agree with petitioners. First, the record does not support
Greenwich's claim that it did not inform the European trader where to
ship the merchandise until after the terms of sale were fixed. Rather,
as verification revealed, the contract setting the terms of sale
included as identification of the shipment destination. Second, the
fact that sales terms are ``duty unpaid'' is far outweighed by the fact
that the merchandise was shipped to the United States and the absence
of any indication that the seller could legitimately expect such sales
not to enter the U.S. market. Accordingly, we have not calculated a
company-specific margin for Greenwich because we find that it did not
make any U.S. sales of the subject merchandise during the POI. Instead,
Greenwich and its European supplier will both be subject to the
``Ukraine-wide'' rate.
Comment 4: Completeness of Ukraine Magnesium Industry's Response
Petitioners argue that, as state owned entities, Zaporozhye and
Concern Oriana comprise the consolidated magnesium industry in Ukraine.
According to petitioners, total BIA should be assigned to this
consolidated Ukrainian industry because the industry as a whole failed
to report complete sales information (i.e., Zaporozhye did not provide
a complete response to the questionnaire). They also claim that total
BIA should also be assigned to third-country exporters because of the
Ukrainian industry's non-cooperation.
If the Department elects not to apply total BIA to all third-
country exporters in this proceeding, then petitioners contend that the
Department should base FMV for the exporters' U.S. sales (1) wholly on
BIA, disregarding Concern [[Page 16435]] Oriana's factors of
production, or (2) on a simple average of Concern Oriana's calculated
FMV and a BIA-based FMV for Zaporozhye, or that the Department should
link individual exporters' applicable deposit rate to the specific
producer which supplies subject merchandise.
Gerald Metals counters that Concern Oriana's magnesium production
process is similar to that of Zaporozhye and, therefore, the Department
should use only verified information from Concern Oriana to calculate
FMV in its LTFV analyses.
DOC Position
If an antidumping duty order is issued in this proceeding, any
direct sales from Ukraine will be subject to a deposit rate based on
total BIA. (See discussion of ``All Other Companies'' in the ``Fair
Value Comparisons'' section of this notice, above).
As to the third-country exporters, we have continued to follow the
approach set out in the preliminary determination. We have based FMV
for those companies' reported U.S. sales of Concern-Oriana-produced
merchandise on Concern Oriana's factors of production; we have not
calculated FMV for reported sales of Zaporozhye-produced merchandise,
but instead have assigned an uncooperative BIA margin. This approach is
consistent with the approach that we have taken in other NME cases,
such as Coumarin, Pencils, and PRC Sulfur Dyes\6\, where the Department
based FMV for an exporter not controlled by the central government only
on the factors of production of the producer or producers which
supplied subject merchandise to that exporter. Under this approach,
individual transaction margins are then weight averaged to arrive at a
single, exporter-specific deposit rate. Further, in a situation like
that created here by Zaporozhye's failure to respond, where FMV
information needed to calculate a margin is not available, the
Department has, as here, resorted to partial BIA and plugged into the
weighted-average calculations BIA margins for individual transactions.
(See, e.t., Pencils.)
\6\Final Determination of Sales at Less Than Fair Value: Sulfur
Dyes, Including Sulfur Vat Dyes, from the People's Republic of China
(58 FR 7543, February 8, 1993)
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Comment 5: Scope
Petitioners contend that the Department should clarify the scope in
this proceeding. Petitioners argue that ``off-specification'' pure
magnesium (i.e., magnesium that is less than 99.8% pure magnesium but
that otherwise can be and is considered pure magnesium by consumers)
should be considered as within the scope. Petitioners propose a revised
scope to achieve this end.
Greenwich argues that the proposed revised scope is flawed because
it appears to include secondary magnesium (i.e., magnesium that has
been remelted and recast) as subject merchandise.
DOC Position
We agree with petitioners that some magnesium is produced which,
despite not meeting the normal definition (based on magnesium content)
of pure magnesium, nevertheless may be used in applications that
normally require pure magnesium. In fact, the records in the concurrent
antidumping investigations of pure and alloy magnesium from the
People's Republic of China show sales of such magnesium were supplied
to fulfill an order for pure magnesium.
We therefore have revised the scope to include this off-
specification pure magnesium within the definition of pure magnesium.
Off-specification pure magnesium is described as any product (1) that
is 50 percent or more primary magnesium, and (2) that does not meet any
ASTM definition of alloy magnesium (based on specific percentages of
one or more alloying agents).
We note that our consultations with the Bureau of Mines established
that the industry standards for alloy magnesium are ASTM standards.
(See Final Calculation Memorandum). Consequently, we have not adopted
scope language proposed by petitioners that refers to alloy magnesium
defined by ``other industry standards'' in illustrating products that
are not off-specification pure magnesium. Although ASTM standards
define pure magnesium as not less than 99.8 percent magnesium, we
believe that metal with a primary magnesium content below that level
should be captured in the scope if it cannot legitimately be defined as
a specific ASTM alloy magnesium.
The fact that the scope encompasses only merchandise with primary
magnesium content of 50 percent or greater means that merchandise
composed of 50 percent or more secondary magnesium is excluded.
Comment 6: By-Product Offset Methodology
Petitioners contend that the Department's decision to permit an
offset to material surrogate values to account for the chlorine by-
product of the magnesium production process was erroneous for the
following reasons: (1) the producers were unable to demonstrate for the
record that any economic benefit accrued to the firm and that such
benefit was linked to the production of the subject merchandise; (2)
the surrogate value used was incorrect in that it did not correspond to
the actual purity level of the by-product produced and was not
calculated net of transportation and processing costs; and (3) any
adjustment determined to be appropriate should have been made to the
cost of manufacture rather than cost of materials so as not to
understate factory overhead, general expenses, and profit.
Concern Oriana argues that the cost of manufacturing magnesium
should be reduced by the value of chlorine by-product.
DOC Position
We agree with petitioners in part. First, because the by-product
results from the production process and is either used by the magnesium
producer or sold for use by some other company in the NME country, it
is a factor whose value must be taken into account in our calculation
of the fair value against which to test U.S. prices. Second, we have
adjusted the by-product's surrogate CIF import value to reflect
concentration differences. However, no adjustment to value for
transportation costs is appropriate; for by-products, as for material
factors of production consumed in the production process, we consider
the import values used to be surrogates for ex-factory, freight-
exclusive prices from suppliers to consumers. Third, we agree with
petitioners that the proper adjustment is a reduction in the cost of
manufacture. This adjustment increases overhead amount commensurately
with the value of the by-product, thereby eliminating the need for
valuing any additional processing-related elements. Additionally, an
adjustment to cost of manufacture is consistent with Department
practice in other NME investigations (see, e.g., Coumarin).
Comment 7: Surrogate General Expenses and Profit
Petitioners argue that an amount should be included in FMV
calculations in order to reflect general expenses incurred and profit
realized by each reseller involved in the sales process. Petitioners
argue that, because the responding resellers failed to provide their
selling expenses (despite a Departmental request to do so in the
questionnaire), the Department should add an amount based on financial
statements submitted by resellers. [[Page 16436]]
Greenwich, Hochschild, and Gerald Metals, assert that petitioners
have provided no convincing rebuttal to the Department's recent
rejection of such a request in Coumarin, and note that the
questionnaires they received did not contain section D, the section
dealing with general expenses.
DOC Response
We agree with respondents that an addition to FMV of actual
reseller general expenses and profit would be inappropriate. Given that
Ukraine is an NME and the Ukrainian magnesium industry has not been
found to be market oriented, section 773(c) of the Act requires that
the Department measure U.S. prices against the factors of production
(materials, labor, energy, and overhead) used in producing the
merchandise, valued in an appropriate surrogate country, plus general
expenses, profit and containers. The Act's only specific guidance as to
the valuation of general expenses, profit and containers is to
establish minima for the first two. Our regulations, meanwhile,
instruct us to ``include in this calculation of constructed value an
amount for general expenses and profit, as required by section
773(e)(1)(B) of the Act. (19 CFR 353.52(c)) The Department has not
interpreted the Act and the regulations as requiring use of actual
expenses and profit for these FMV components when FMV is based on
factors of production; the Department has also explicitly rejected such
adjustments in prior NME proceedings (see, e.g., Coumarin and
Sparklers\7\). Moreover, to do so simply does not make sense because it
amounts to a comparison of apples and oranges. In NME proceedings, the
FMV is normally based completely on factors valued in a surrogate
country (without regard to, for example, actual selling expenses) on
the premise that the actual experience cannot be meaningfully
considered. Were the question simply one of ``traditional'' dumping by
trading companies, the market-economy price-to-price or price-to-CV
methodology would appropriately be employed; actual selling expenses
would have been accounted for on both U.S. prices and foreign market
prices (or, if appropriate, constructed value, in which case other
general expenses and profit would also have been taken into account).
Accordingly, we have continued to value general expenses and profit by
simply applying to the surrogate-based cost of manufacture the greater
of either appropriate surrogate percentages or the statutory minima.
\7\Final Determination of Sales at Less Than Fair Value:
Sparklers from the People's Republic of China (56 FR 20588, May 6,
1991)
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Command 8: Surrogate Value of Labor
Petitioners challenge the Department's use of an unskilled labor
value in the preliminary determination to account for both skilled and
unskilled labor. Petitioners assert that, if the Department cannot
locate specific skilled and unskilled labor values from the chosen
surrogate countries, the Department should employ labor rates from the
petition as BIA.
DOC Position
We have obtained and used Indonesian wage data for 1992 for skilled
and unskilled labor (see PRC Lighters\8\). Because Indonesia is our
primary surrogate country, we do not need to address the question of an
appropriate alternative source of values for these factors.
\8\Preliminary Determination of Sales at Less Than Fair Value:
Disposable Pocket Lighters from the People's Republic of China (59
FR 64191, December 13, 1994)
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Comment 9: Unreported Material.
Petitions assert that the Department should include in Concern
Oriana's FMV the value for a material which was not included in the
preliminary determination. In its questionnaire response, Concern
Oriana did not provide usage information for this material, claiming
that its value was not significant. Petitioners contend that the value
in Ukraine is not relevant since the input would be valued in a
surrogate country. Therefore, as BIA, petitioners advocate use of an
average of all other direct input values as the value for this input.
DOC Position
We disagree. Verification confirmed that this factor was properly
omitted since it was a waste product of the magnesium production
process for which only a very small fraction was recycled into the
production process. Therefore, it is appropriate not to value this
input in the FMV calculation.
Comment 10: Concentration/Purity Levels of Material Inputs
Petitioners contend that appropriate adjustments should be made for
differences in concentration or purity between surrogate values on the
one hand and materials used in production on the other hand. However,
petitioners also argue that the Department should not assume that
surrogate values represent 100 percent concentration and therefore
should make no adjustment where the concentration applicable to a
surrogate value cannot be determined.
DOC Position
Where we have been able to determine the purity or concentration
applicable to a surrogate value, we have adjusted for differences, if
any, between the surrogate and the actual material. Otherwise, we have
attempted no adjustment for purity or concentration.
Continuation of Suspension of Liquidation
In accordance with section 733(d) of the Act, we are directing the
Customs Service to continue to suspend liquidation of all entries of
pure magnesium from Ukraine that are entered, or withdrawn from
warehouse, for consumption on or after November 7, 1994, which is the
date of publication our notice of preliminary determination in the
Federal Register. The Customs Service shall require a cash deposit or
posting of a bond equal to the estimated amount by which the FMV
exceeds the USP as shown below. These suspension of liquidation
instructions will remain in effect until further notice.
Consistent with our practice in investigations involving imports
from NME countries, we have calculated a single, ``Ukraine-wide''
deposit rate applicable to all exporters in Ukraine, as well as any
exporters in third countries that have not been assigned a company-
specific margin. As is discussed under ``All Other Companies'' in the
``Fair Value Comparisons'' section of this notice, the record in this
investigation indicates that Ukraine exporters of magnesium may not
have responded to our questionnaire; therefore, the ``Ukraine-wide''
deposit rate has been calculated based on total BIA.
The weighted-average dumping margins are as follows:
------------------------------------------------------------------------
Weighted-
average
Manufacturer/producer exporter margin
percentage
------------------------------------------------------------------------
Gerald Metals.............................................. 103.27
MG Metals.................................................. 79.87
Hochschild Partners........................................ 92.21
Ukraine-Wide Rate.......................................... 104.27
------------------------------------------------------------------------
ITC Notification
In accordance with section 735(d) of the Act, we have notified the
ITC of our determination. As our final determination is affirmative,
the ITC will within 45 days determine whether imports the subject
merchandise are materially injuring, or threaten material injury to,
the U.S. industry. If the ITC determines that material injury, or
threat of material injury does not exist, [[Page 16437]] the
investigation will be terminated and all securities posted will be
refunded or canceled. If the ITC determines that such injury does
exist, the Department will issue an antidumping duty order directing
Customs officials to assess antidumping duties on all imports of the
subject merchandise entered for consumption on all after the effective
date of the suspension of liquidation.
This determination is published pursuant to section 735(d) of the
Act and 19 CFR 353.20(a)(4).
Dated: March 22, 1995.
Susan G. Esserman,
Assistant Secretary for Import Administration.
[FR Doc. 95-7775 Filed 3-29-95; 8:45 am]
BILLING CODE 3510-DS-P
