01-15652. Notice of Final Determination of Sales at Less Than Fair Value: Steel Concrete Reinforcing Bars From the People's Republic of China

AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

EFFECTIVE DATE:

June 22, 2001.

FOR FURTHER INFORMATION CONTACT:

Magd Zalok or Constance Handley, Group II, Office 5, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW., Washington, DC 20230; telephone: [phone], respectively.

SUPPLEMENTARY INFORMATION:

The Applicable Statute and Regulations

Unless otherwise indicated, all citations to the statute are references to the provisions effective January 1, 1995, the effective date of the amendments made to the Tariff Act of 1930 (the Act) by the Uruguay Round Agreements Act (URAA). In addition, unless otherwise indicated, all citations to Department of Commerce (the Department) regulations refer to the regulations codified at 19 CFR part 351 (April 2000).

Final Determination

We determine that steel concrete reinforcing bar (rebar) from the People's Republic of China (PRC) is being sold, or is likely to be sold, in the United States at less than fair value (LTFV), as provided in section 735 of the Act. The estimated margins of sales at LTFV are shown in the Final Margins section of this notice.

Case History

The preliminary determination in this investigation was issued on January 16, 2001. See Preliminary Determination of Sales at Less Than Fair Value and Postponement of Final Determination: Steel Concrete Reinforcing Bars From the People's Republic of China, 66 FR 8339 (January 30, 2001) (Preliminary Determination).

We conducted verification of the questionnaire responses of Laiwu Steel Group, Ltd., and Laiwu Steel Corporation (collectively, Laiwu), from March 5 through March 9, 2001.

On March 1, 2001, Laiwu requested a hearing, and on March 2, 2001, the petitioner ^[1] requested to participate in a hearing if a hearing was to be held. However, on May 4, 2001, Laiwu withdrew its request for a hearing.

Section 734(m) of the Act states that in the case of regional industry investigations, the administering authority shall offer exporters the opportunity to enter into suspension agreements. Proposed and finalized agreements in these cases must comport with the requirements set forth under section 734 of the Act for the suspension of antidumping duty investigations. The exporter participating in the instant investigation was aware of its opportunity to propose a suspension agreement. However, the Department did not accept a suspension agreement in this proceeding. See Memorandum from Holly Kuga to The File, dated April 2, 2001.

Scope of Investigation

For purposes of this investigation, the product covered is all rebar sold in straight lengths, currently classifiable in the Harmonized Tariff Schedule of the United States (HTSUS) under item number 7214.20.00 or any other tariff item number. Specifically excluded are plain rounds (i.e., non-deformed or smooth bars) and rebar that has been further processed through bending or coating. HTSUS subheadings are provided for convenience and Customs purposes. The written description of the scope of this proceeding is dispositive.

Period of Investigation

The period of investigation (POI) is October 1, 1999, through March 31, 2000. This period corresponds to the two most recent fiscal quarters prior to the month of the filing of the petition (i.e., June 2000).

Non-market Economy Country

The Department has treated the PRC as a non-market economy (NME) country in all past antidumping investigations. See, e.g., Final Determination of Sales at Less Than Fair Value: Bulk Aspirin From the People's Republic of China, 65 FR 33805 (May 25, 2000), and Final Determination of Sales at Less Than Fair Value: Certain Non-Frozen Apple Juice Concentrate from the People's Republic of China, 65 FR 19873 (April 13, 2000). A designation as a NME remains in effect until it is revoked by the Department. See section 771(18)(C) of the Act. The respondent in this investigation has not requested a revocation of the PRC's NME status. Therefore, we have continued to treat the PRC as a NME in this investigation. For further details, see the Department's Preliminary Determination.

Separate Rates

In our preliminary determination, we found that Laiwu had met the criteria for the application of separate antidumping duty rates. We have not received any other information since the preliminary determination which would warrant reconsideration of our separate rates determination with respect to Laiwu. Therefore, we continue to find that Laiwu should be assigned an individual dumping margin. For a complete discussion of the Department's determination that Laiwu is entitled to a separate rate, see the Department's Preliminary Determination.

The People's Republic of China-Wide Rate and Use of Facts Otherwise Available

As explained in the Department's Preliminary Determination, Laiwu was the only exporter to respond to the Department's questionnaire and cooperate in this investigation. Therefore, we have continued to calculate a company-specific rate for Laiwu only. However, in the Preliminary Determination, we stated that our review of U.S. import statistics from the PRC reveals that Laiwu did not account for all imports into the United States from the PRC. For this reason, we determined that some PRC exporters of rebar failed to cooperate in this investigation. In accordance with our standard practice, as adverse facts available, we are assigning as the PRC-wide rate the higher of: (1) The highest margin stated in the notice of initiation; or (2) the margin calculated for Laiwu. See, e.g., Final Determination of Sales at Less Than Fair Value: Certain Cold-Rolled Flat-Rolled Carbon Quality Steel Products From The People's Republic of China, 65 FR 34660 (May 31, 2000). For purposes of the final determination of this investigation, we are using the margin calculated for Laiwu since it is higher than the margin stated in the notice of initiation.

Surrogate Country

For purposes of the final determination, we find that India remains the appropriate primary surrogate country for the PRC. For further discussion and analysis regarding the surrogate country selection for the PRC, see the Department's Preliminary Determination.

Analysis of Comments Received

All issues raised in the case and rebuttal briefs by parties to this proceeding and to which we have responded are listed in the Appendix to this notice and addressed in the Issues and Decision Memorandum for the Final Determination in the Antidumping Duty Investigation of Steel Concrete Reinforcing Bars from China (Decision Memorandum), from Bernard T. Carreau, Deputy Assistant Secretary, Import Administration to Faryar Shirzad, Assistant Secretary for Import Administration, dated June 14, 2001, which is hereby adopted by this notice. Parties can find a complete discussion of the issues raised in this investigation and the corresponding recommendations in this public memorandum, which is on file in the Central Records Unit, room B-099 of the main Department building. In addition, a complete version of the Decision Memorandum can be accessed directly on the Web at http://ia.ita.doc.gov. The paper copy and electronic version of the Decision Memorandum are identical in content.

Changes Since the Preliminary Determination

Based on our findings at verification, and analysis of comments received, we have made adjustments to the calculation methodology in calculating the final dumping margin in this proceeding. These adjustments are summarized below:

1. For the export price, we have recalculated the inflator used to adjust the rate of brokerage and handling. For further details, see Comment 9 in the Decision Memorandum, and Memorandum To the File, Analysis Memorandum for Laiwu Steel Group Ltd. and Laiwu Steel Corporation re: Final Determination (Analysis Memorandum), dated June 14, 2001.

2. With regard to two inputs into the production of rebar, iron ore concentrate and iron ore fines, a portion of these inputs was produced by Laiwu, and the remaining portion was purchased from suppliers. The valuation of the self-produced portion of these material inputs was based on adverse facts available because we found at verification that Laiwu misreported its corporate structure. Had we known prior to verification that certain divisions of Laiwu actually produced a portion of its iron ore concentrate and iron ore fines, we would have requested Laiwu's factors of production for these inputs. We used, as adverse facts available, the Egyptian 1998 non-agglomerated iron ore price from the United Nation's Handbook of World Mineral Statistics, 1993-1998, inflated to the POI. For the remaining portion of iron ore concentrate, which was purchased from domestic suppliers, with the exception of one transaction involving a market-economy country, we used a surrogate value from the Philippines because we could not find an appropriate surrogate value from India. Unlike the preliminary determination, we did not use the actual market-economy price because at verification we discovered that the transaction in question was unusual in that the iron ore purchased was not comparable to the iron ore concentrate normally used by Laiwu. For the remaining portion of iron ore fines, which was purchased from a market-economy country at market-economy prices, we continued to use the actual price paid by Laiwu. For further details, see Comment 1 in the Decision Memorandum, and the Analysis Memorandum.

3. For selling, general and administrative expenses (SG&A) and overhead, we used a simple average of the ratios derived from the financial statements of Tata Iron and Steel Company Limited and the Steel Authority of India (SAIL). With respect to profit, we used only TATA's profit rate because SAIL's financial statement does not reflect profit. For further details, see Comment 8 in the Decision Memorandum, and the Analysis Memorandum.

4. With respect to the by-products water slag and oxide iron skin, we have determined that the Indian values for those by-products were aberrational. For this reason, we based the value for water slag on pricing information provided in the U.S. Geological Survey, Minerals, Commodities Summaries, and the value for oxide iron skin on the U.N. Commodity Trade Statistics for Indonesia. For further details see Comment 5-B in the Decision Memorandum, and the Analysis Memorandum.

5. We did not offset the normal value for the by-product ammonia water because, at verification, Laiwu was unable to present evidence that it sold ammonia water to outside customers, or that the ammonia water was of a commercial value and had indeed been reintroduced in the production process of Laiwu's non-subject products. See Comment 5-C in the Decision Memorandum, and the Analysis Memorandum.

6. For the input hoist link, we granted Laiwu an offset to the cost of the hoist links equal to the value of the end-cutting scrap provided by Laiwu to the manufacturer of hoist link. See Comment 5-H of Decision Memorandum, and the Analysis Memorandum.

7. We corrected minor errors in the value of ferrosilicon and aluminum manganese to reflect the quantity and value of imports from only market-economy countries. See Comment 9 of the Decision Memorandum, and the Analysis Memorandum.

8. We revised the value of coal to reflect bituminous coal, and the value of coal fines to reflect anthracite coal. See Comment 5-E of the Decision Memorandum, and the Analysis Memorandum.

9. We revised the value of briquetting scrap to correspond to the value for cast iron scrap. See Comment 5-E of Decision Memorandum, and the Analysis Memorandum.

Verification

As provided in section 782(i) of the Act, we verified the information submitted by the respondent 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 the respondents.

Critical Circumstances

Based on new information on the record of this investigation and information provided in our preliminary affirmative critical circumstances determination, we have determined, for purposes of the final determination, that critical circumstances exist for Laiwu Steel Group and the non-responding exporters. For further details, see the Memorandum from Case Analysts to Bernard T. Carreau, Deputy Assistant Secretary, Import Administration, Antidumping Duty Investigation of Steel Concrete Reinforcing Bar from the People's Republic of China PRC—Final Affirmative Determination of Critical Circumstances, dated June 14, 2001.

Final Margins

We determine that the following weighted-average dumping margins for the PRC exist:

Exporter/manufacturer	Weighted-average margin percentage
Laiwu Steel Group	133.00
PRC-Wide Rate	133.00

The PRC-wide rate applies to all entries of the subject merchandise except for entries from exporters/producers that are identified individually above.

Continuation of Suspension of Liquidation

In accordance with section 735(c)(1)(B) of the Act, we are directing the Customs Service to continue to suspend liquidation of all entries of steel concrete reinforcing bars from the PRC that are entered, or withdrawn from warehouse, for consumption on or after November 1, 2000, (i.e., 90 days prior to the date of publication of the preliminary determinations in the Federal Register). The Customs Service shall continue to require a cash deposit or the posting of a bond based on the estimated weighted-average dumping margins shown below. The suspension of liquidation instructions will remain in effect until further notice.

ITC Notification

In accordance with section 735(d) of the Act, we have notified the International Trade Commission (ITC) of our determination. As our final determination is affirmative, the ITC will determine, within 45 days, whether these imports are causing material injury, or threat of material injury, to an industry in the United States. If the ITC determines that material injury or threat of injury does not exist, the proceeding 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, or withdrawn from warehouse, for consumption on or after the effective date of the suspension of liquidation.

This determination is issued and published in accordance with sections 735(d) and 777(i)(1) of the Act.

Dated: June 14, 2001.

Faryar Shirzad,

Assistant Secretary for Import Administration.

Appendix

List of Comments in the Issues and Decision Memorandum

I. GENERAL ISSUES

Comment 1: Value of iron ore concentrate

Comment 2: Actual vs. theoretical weight

Comment 3: Calculation of SG&A and Overhead

Comment 4: Application of Overhead Ratio to the Upstream Stages of Production

Comment 5: Appropriate Surrogate Values and Treatment for Certain Material Inputs

Comment 6: Appropriate Rate for Ocean Freight

Comment 7: Re-calculating Overhead to Include the Cost of Minor Materials

Comment 8: Basis for Financial Ratios

Comment 9: Clerical Errors

Footnotes

1.  The petitioner in this investigation is the Rebar Trade Action Coalition (RTAC), and its individual members, AmerSteel, Auburn Steel Co., Inc., Birmingham Steel Corp., Border Steel, Inc., Marion Steel Company, Riverview Steel, and Nucor Steel and CMC Steel Group.