2017-06703. Certain Carbon and Alloy Steel Cut-To-Length Plate From Taiwan: Final Determination of Sales at Less Than Fair Value and Final Negative Determination of Critical Circumstances

AGENCY:

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

SUMMARY:

The Department of Commerce (the Department) determines that certain carbon and alloy steel cut-to-length plate (CTL plate) from Taiwan is being, or is likely to be, sold in the United States at less than fair value (LTFV). In addition, we determine that critical circumstances do not exist with respect to imports of the subject merchandise. The period of investigation (POI) is April 1, 2015, through March 31, 2016. The final dumping margins of sales at LTFV are listed below in the “Final Determination” section of this notice.

DATES:

Effective April 4, 2017.

FOR FURTHER INFORMATION CONTACT:

Davina Friedmann or Tyler Weinhold, AD/CVD Operations, Office VI, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 1401 Constitution Avenue NW., Washington, DC 20230; telephone: [phone] and [phone], respectively.

SUPPLEMENTARY INFORMATION:

Background

On November 14, 2016, the Department published the Preliminary Determination of sales at LTFV of CTL plate from Taiwan.^[1] A summary of the events that occurred since the Department published the Preliminary Determination, as well as a full discussion of the issues raised by parties for this final determination, may be found in the Issues and Decision Memorandum, which is hereby adopted by this notice.^[2]

Scope of the Investigation

The scope of the investigation covers CTL plate from Taiwan. For a complete description of the scope of the investigation, see Appendix I.

Analysis of Comments Received

All issues raised in the case and rebuttal briefs by parties in this investigation are addressed in the Issues and Decision Memorandum. A list of the issues raised is attached to this notice as Appendix II. The Issues and Decision Memorandum is a public document and is on file electronically via Enforcement and Compliance's Antidumping and Countervailing Duty Centralized Electronic Service System (ACCESS). ACCESS is available to registered users at https://access.trade.gov,, and it is available to all parties in the Central Records Unit, Room B-8024 of the main Department of Commerce building. In addition, a complete version of the Issues and Decision Memorandum can be accessed directly at http://enforcement.trade.gov/​frn/​index.html. The signed and electronic versions of the Issues and Decision Memorandum are identical in content.

Verification

As provided in section 782(i) of the Tariff Act of 1930, as amended (the Act), in November and December 2016, and in January 2017, we verified the sales and cost information submitted by China Steel Corporation (China Steel) and Shang Chen Steel Co., Ltd. (Shang Chen) for use in our final determination. We used standard verification procedures, including an examination of relevant accounting and production records, and original source documents provided by China Steel and Shang Chen.^[3]

Changes Since the Preliminary Determination

Based on our analysis of the comments received and our findings at verification, we made certain changes to the margin calculations for China Steel and Shang Chen. For a discussion of these changes, see the “Margin Calculations” section of the Issues and Decision Memorandum.

Final Determination of Negative Critical Circumstances

For the Preliminary Determination, the Department found that critical circumstances existed with respect to imports of CTL plate from China Steel and the companies that are covered by the “all others” rate, but did not exist for imports from Shang Chen.^[4] We modified our critical circumstances findings for China Steel and the companies that are covered by the “all others” rate for the final determination. For further discussion, see the Issues and Decision Memorandum at Comment 11. Thus, pursuant to section 735(a)(3) of the Act and 19 CFR 351.206, we find that critical circumstances do not exist with respect to subject merchandise produced or exported by China Steel, Shang Chen, or the companies that are covered by the “all others” rate.

Adverse Facts Available

In making this final determination, the Department relied, in part, on facts available for China Steel and Shang Chen. Furthermore, because China Steel and Shang Chen did not act to the best of their ability in responding to certain of the Department's requests for information, we drew an adverse inference where appropriate in selecting from among the facts otherwise available.^[5] For further information, see the accompanying Issues and Decision Memorandum.

All-Others Rate

Section 735(c)(5)(A) of the Act provides that the estimated all-others rate shall be an amount equal to the weighted-average of the estimated weighted-average dumping margins established for exporters and producers individually investigated, excluding any zero or de minimis margins, and margins determined entirely under section 776 of the Act. For the final determination, the Department calculated the “all others” rate based on a simple average of China Steel's and Shang Chen's margins.^[6]

Final Determination

The final weighted-average dumping margins are as follows:

Exporter/manufacturer	Weighted- average dumping margin (percent)
China Steel Corporation	6.95
Shang Chen Steel Co., Ltd	3.62
All Others	5.29

Disclosure

We will disclose the calculations performed within five days of the date of publication of this notice to parties in this proceeding in accordance with 19 CFR 351.224(b).

Continuation of Suspension of Liquidation

In accordance with section 735(c)(1)(B) of the Act, the Department will instruct U.S. Customs and Border Protection (CBP) to continue to suspend liquidation of all appropriate entries of CTL plate from Taiwan, as described in Appendix I of this notice, which were entered, or withdrawn from warehouse, for consumption on or after November 14, 2016, the date of publication of the preliminary determination of this investigation in the Federal Register. The Department will instruct CBP to require a cash deposit equal to the estimated amount by which the normal value exceeds the U.S. price as shown above.

Further, because our final critical circumstances determination is negative, in accordance with section 735(c)(3) of the Act, we will instruct CBP to terminate the retroactive suspension of liquidation ordered at the Preliminary Determination for China Steel and “all other” companies and to release any bond or security and refund any cash deposits required with respect to entries covered by the retroactive suspension of liquidation.

International Trade Comission (ITC) Notification

In accordance with section 735(d) of the Act, we will notify the ITC of the final affirmative determination of sales at LTFV. Because the final determination in this proceeding is affirmative, in accordance with section 735(b)(2) of the Act, the ITC will make its final determination as to whether the domestic industry in the United States is materially injured, or threatened with material injury, by reason of imports of CTL plate from France no later than 45 days after our final determination. If the ITC determines that material injury or threat of material injury does not exist, the proceeding will be terminated and all cash deposits will be refunded. If the ITC determines that such injury does exist, the Department will issue an antidumping duty order directing CBP to assess, upon further instruction by the Department, antidumping duties on all imports of the subject merchandise entered, or withdrawn from warehouse, for consumption on or after the effective date of the suspension of liquidation.

Notification Regarding Administrative Protective Orders (APO)

This notice serves as a reminder to parties subject to APO of their responsibility concerning the disposition of proprietary information disclosed under APO in accordance with 19 CFR 351.305(a)(3). Timely notification of the return or destruction of APO materials, or conversion to judicial protective order, is hereby requested. Failure to comply with the regulations and the terms of an APO is a sanctionable violation.

This determination and this notice are issued and published pursuant to sections 735(d) and 777(i)(1) of the Act.

Dated: March 29, 2017.

Ronald K. Lorentzen,

Acting Assistant Secretary for Enforcement and Compliance.

Appendix I

Scope of the Investigation

The products covered by this investigation are certain carbon and alloy steel hot-rolled or forged flat plate products not in coils, whether or not painted, varnished, or coated with plastics or other non-metallic substances (cut-to-length plate). Subject merchandise includes plate that is produced by being cut-to-length from coils or from other discrete length plate and plate that is rolled or forged into a discrete length. The products covered include (1) Universal mill plates (i.e., flat-rolled products rolled on four faces or in a closed box pass, of a width exceeding 150 mm but not exceeding 1250 mm, and of a thickness of not less than 4 mm, which are not in coils and without patterns in relief), and (2) hot-rolled or forged flat steel products of a thickness of 4.75 mm or more and of a width which exceeds 150 mm and measures at least twice the thickness, and which are not in coils, whether or not with patterns in relief. The covered products described above may be rectangular, square, circular or other shapes and include products of either rectangular or non-rectangular cross-section where such non-rectangular cross-section is achieved subsequent to the rolling process, i.e., products which have been “worked after rolling” (e.g., products which have been beveled or rounded at the edges).

For purposes of the width and thickness requirements referenced above, the following rules apply:

(1) Except where otherwise stated where the nominal and actual thickness or width measurements vary, a product from a given subject country is within the scope if application of either the nominal or actual measurement would place it within the scope based on the definitions set forth above; and

(2) where the width and thickness vary for a specific product (e.g., the thickness of certain products with non-rectangular cross-section, the width of certain products with non-rectangular shape, etc.), the measurement at its greatest width or thickness applies.

Steel products included in the scope of this investigation are products in which: (1) Iron predominates, by weight, over each of the other contained elements; and (2) the carbon content is 2 percent or less by weight.

Subject merchandise includes cut-to-length plate that has been further processed in the subject country or a third country, including but not limited to pickling, oiling, levelling, annealing, tempering, temper rolling, skin passing, painting, varnishing, trimming, cutting, punching, beveling, and/or slitting, or any other processing that would not otherwise remove the merchandise from the scope of the investigation if performed in the country of manufacture of the cut-to-length plate.

All products that meet the written physical description, are within the scope of this investigation unless specifically excluded or covered by the scope of an existing order. The following products are outside of, and/or specifically excluded from, the scope of this investigation:

(1) Products clad, plated, or coated with metal, whether or not painted, varnished or coated with plastic or other non-metallic substances;

(2) military grade armor plate certified to one of the following specifications or to a specification that references and incorporates one of the following specifications:

• MIL-A-12560,
• MIL-DTL-12560H,
• MIL-DTL-12560J,
• MIL-DTL-12560K,
• MIL-DTL-32332,
• MIL-A-46100D,
• MIL-DTL-46100-E,
• MIL-46177C,
• MIL-S-16216K Grade HY80,
• MIL-S-16216K Grade HY100,
• MIL-S-24645A HSLA-80;
• MIL-S-24645A HSLA-100,
• T9074-BD-GIB-010/0300 Grade HY80,
• T9074-BD-GIB-010/0300 Grade HY100,
• T9074-BD-GIB-010/0300 Grade HSLA80,
• T9074-BD-GIB-010/0300 Grade HSLA100, and
• T9074-BD-GIB-010/0300 Mod. Grade HSLA115,

except that any cut-to-length plate certified to one of the above specifications, or to a military grade armor specification that references and incorporates one of the above specifications, will not be excluded from the scope if it is also dual- or multiple-certified to any other non-armor specification that otherwise would fall within the scope of this investigation;

(3) stainless steel plate, containing 10.5 percent or more of chromium by weight and not more than 1.2 percent of carbon by weight;

(4) CTL plate meeting the requirements of ASTM A-829, Grade E 4340 that are over 305 mm in actual thickness;

(5) Alloy forged and rolled CTL plate greater than or equal to 152.4 mm in actual thickness meeting each of the following requirements:

(a) Electric furnace melted, ladle refined & vacuum degassed and having a chemical composition (expressed in weight percentages):

• Carbon 0.23-0.28,
• Silicon 0.05-0.20,
• Manganese 1.20-1.60,
• Nickel not greater than 1.0,
• Sulfur not greater than 0.007,
• Phosphorus not greater than 0.020,
• Chromium 1.0-2.5,
• Molybdenum 0.35-0.80,
• Boron 0.002-0.004,
• Oxygen not greater than 20 ppm,
• Hydrogen not greater than 2 ppm, and
• Nitrogen not greater than 60 ppm;

(b) With a Brinell hardness measured in all parts of the product including mid thickness falling within one of the following ranges:

(i) 270-300 HBW,

(ii) 290-320 HBW, or

(iii) 320-350HBW;

(c) Having cleanliness in accordance with ASTM E45 method A (Thin and Heavy): A not exceeding 1.5, B not exceeding 1.0, C not exceeding 0.5, D not exceeding 1.5; and

(d) Conforming to ASTM A578-S9 ultrasonic testing requirements with acceptance criteria 2 mm flat bottom hole;

(6) Alloy forged and rolled steel CTL plate over 407 mm in actual thickness and meeting the following requirements:

(a) Made from Electric Arc Furnace melted, Ladle refined & vacuum degassed, alloy steel with the following chemical composition (expressed in weight percentages):

• Carbon 0.23-0.28,
• Silicon 0.05-0.15,
• Manganese 1.20-1.50,
• Nickel not greater than 0.4,
• Sulfur not greater than 0.010,
• Phosphorus not greater than 0.020,
• Chromium 1.20-1.50,
• Molybdenum 0.35-0.55,

• Boron 0.002-0.004,
• Oxygen not greater than 20 ppm,
• Hydrogen not greater than 2 ppm, and
• Nitrogen not greater than 60 ppm;

(b) Having cleanliness in accordance with ASTM E45 method A (Thin and Heavy): A not exceeding 1.5, B not exceeding 1.5, C not exceeding 1.0, D not exceeding 1.5;

(c) Having the following mechanical properties:

(i) With a Brinell hardness not more than 237 HBW measured in all parts of the product including mid thickness; and having a Yield Strength of 75ksi min and UTS 95ksi or more, Elongation of 18% or more and Reduction of area 35% or more; having charpy V at −75 degrees F in the longitudinal direction equal or greater than 15 ft. lbs (single value) and equal or greater than 20 ft. lbs (average of 3 specimens) and conforming to the requirements of NACE MR01-75; or

(ii) With a Brinell hardness not less than 240 HBW measured in all parts of the product including mid thickness; and having a Yield Strength of 90 ksi min and UTS 110 ksi or more, Elongation of 15% or more and Reduction of area 30% or more; having charpy V at −40 degrees F in the longitudinal direction equal or greater than 21 ft. lbs (single value) and equal or greater than 31 ft. lbs (average of 3 specimens);

(d) Conforming to ASTM A578-S9 ultrasonic testing requirements with acceptance criteria 3.2 mm flat bottom hole; and

(e) Conforming to magnetic particle inspection in accordance with AMS 2301;

(7) Alloy forged and rolled steel CTL plate over 407 mm in actual thickness and meeting the following requirements:

(a) Made from Electric Arc Furnace melted, ladle refined & vacuum degassed, alloy steel with the following chemical composition (expressed in weight percentages):

• Carbon 0.25-0.30,
• Silicon not greater than 0.25,
• Manganese not greater than 0.50,
• Nickel 3.0-3.5,
• Sulfur not greater than 0.010,
• Phosphorus not greater than 0.020,
• Chromium 1.0-1.5,
• Molybdenum 0.6-0.9,
• Vanadium 0.08 to 0.12
• Boron 0.002-0.004,
• Oxygen not greater than 20 ppm,
• Hydrogen not greater than 2 ppm, and
• Nitrogen not greater than 60 ppm.

(b) Having cleanliness in accordance with ASTM E45 method A (Thin and Heavy): A not exceeding 1.0(t) and 0.5(h), B not exceeding 1.5(t) and 1.0(h), C not exceeding 1.0(t) and 0.5(h), and D not exceeding 1.5(t) and 1.0(h);

(c) Having the following mechanical properties: A Brinell hardness not less than 350 HBW measured in all parts of the product including mid thickness; and having a Yield Strength of 145ksi or more and UTS 160ksi or more, Elongation of 15% or more and Reduction of area 35% or more; having charpy V at −40 degrees F in the transverse direction equal or greater than 20 ft. lbs (single value) and equal or greater than 25 ft. lbs (average of 3 specimens);

(d) Conforming to ASTM A578-S9 ultrasonic testing requirements with acceptance criteria 3.2 mm flat bottom hole; and

(e) Conforming to magnetic particle inspection in accordance with AMS 2301.

The products subject to the investigation are currently classified in the Harmonized Tariff Schedule of the United States (HTSUS) under item numbers: 7208.40.3030, 7208.40.3060, 7208.51.0030, 7208.51.0045, 7208.51.0060, 7208.52.0000, 7211.13.0000, 7211.14.0030, 7211.14.0045, 7225.40.1110, 7225.40.1180, 7225.40.3005, 7225.40.3050, 7226.20.0000, and 7226.91.5000.

The products subject to the investigation may also enter under the following HTSUS item numbers: 7208.40.6060, 7208.53.0000, 7208.90.0000, 7210.70.3000, 7210.90.9000, 7211.19.1500, 7211.19.2000, 7211.19.4500, 7211.19.6000, 7211.19.7590, 7211.90.0000, 7212.40.1000, 7212.40.5000, 7212.50.0000, 7214.10.0000, 7214.30.0010, 7214.30.0080, 7214.91.0015, 7214.91.0060, 7214.91.0090, 7225.11.0000, 7225.19.0000, 7225.40.5110, 7225.40.5130, 7225.40.5160, 7225.40.7000, 7225.99.0010, 7225.99.0090, 7226.11.1000, 7226.11.9060, 7226.19.1000, 7226.19.9000, 7226.91.0500, 7226.91.1530, 7226.91.1560, 7226.91.2530, 7226.91.2560, 7226.91.7000, 7226.91.8000, and 7226.99.0180.

The HTSUS subheadings above are provided for convenience and customs purposes only. The written description of the scope of the investigation is dispositive.

Appendix II

List of Topics Discussed in the Issues and Decision Memorandum

I. Summary

II. Background

III. Use of Adverse Facts Available

a. China Steel

b. Shang Chen

IV. Scope of the Investigation

V. Scope Comments

VI. Affiliations and Collapsing

VII. Margin Calculations

VIII. Discussion of Issues

a. China Steel

1. Whether to Apply Total Adverse Facts Available to China Steel

2. China Steel Excluded Operating Costs

3. China Steel Under-Reported Prime Merchandise

4. China Steel Under-Reported G&A Expenses

5. China Steel Under-Reported Interest Expenses

6. China Steel Improperly Reduced COGS

7. China Steel Date of Sale

8. China Steel Home Market Post-Sale Price Adjustments

9. China Steel Destination Codes

10. China Steel Packing Expenses

11. Critical Circumstances

12. Alleged Errors in China Steel Verification Report

b. Shang Chen

13. Total Adverse Facts Available for Shang Chen

14. Adjustments to the Reported Per-Unit Cost of Manufacturing

15. Shang Chen General and Administrative Expenses

16. Shang Chen Scrap Offset

17. Quarterly Cost Data

18. Shang Chen Differential Pricing Analysis

19. Shang Chen Date of Sale

20. Shang Chen Sales-Related Revenues

21. Shang Chen Reported Packing Cost

22. Alleged Error in Shang Chen's Margin Calculation Program

IX. Recommendation

Footnotes

1.  See Certain Carbon and Alloy Steel Cut-to-Length Plate From France: Preliminary Determination of Sales at Less Than Fair Value, 81 FR 79420 (November 14, 2016) (Preliminary Determination).

2.  See Memorandum from Gary Taverman, Associate Deputy Assistant Secretary for Antidumping and Countervailing Duty Operations, to Ronald K. Lorentzen, Acting Assistant Secretary for Enforcement and Compliance, “Issues and Decision Memorandum for the Final Affirmative Determination in the Less-Than-Fair-Value Investigation of Certain Carbon and Alloy Steel Cut-to-Length Plate From Taiwan,” dated concurrently with this notice (Issues and Decision Memorandum).

3.  For discussion of our verification findings, see the following memoranda: For China Steel, see Memorandum to the File from Tyler Weinhold, Davina Friedmann, and Tom Bellhouse, Case Analysts, AD/CVD Operations, Office VI, entitled “Verification of the Sales Responses of China Steel corp. in the Investigation on Certain Carbon and Alloy Steel Cut-to-Length Plate From France,” dated February 15, 2017 (China Steel Sales Verification Report); and Memorandum to Neal Halper from Gary Urso, Senior Accountant, Office of Accounting, entitled “Verification of the Cost Response of China Steel Corporation in the Antidumping Duty Investigation of Carbon and Alloy Steel Cut-to-Length Plate from Taiwan,” dated February 9, 2017 (China Steel Cost Verification Report). For Shang Chen, see Memorandum to the File from Davina Friedmann, Tyler Weinhold, and Tom Bellhouse, Case Analysts, AD/CVD Operations, Office VI, entitled “Verification of the Sales Responses of Shang Chen Steel Co., Ltd. in the Investigation on Certain Carbon and Alloy Steel Cut-to-Length Plate from Taiwan,” dated February 9, 2017 (Shang Chen Sales Verification Report); Memorandum to Neal Halper File, Director of Accounting, from Lakshmi Jones Accountant, Office of Accounting, entitled “Verification of the Cost of Production (COP) and Constructed Value (CV) Response of Shang Chen Steel Co. Ltd. (SCS) in the antidumping duty investigation of Cut-to-Length Plate from Taiwan,” dated January 26, 2017 (Shang Chen Cost Verification Report).

4.  See Preliminary Determination, and accompanying Preliminary Decision Memorandum at 4 to 5.

5.  See sections 776(a) and (b) of the Act.

6.  Because we did not have useable publicly-ranged data on the record, we based the all others rate on the simple average of the mandatory respondents' margins.