[Federal Register Volume 59, Number 122 (Monday, June 27, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-15535]
[[Page Unknown]]
[Federal Register: June 27, 1994]
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DEPARTMENT OF COMMERCE
[A-570-835, A-549-812, A-791-802]
Initiation of Antidumping Duty Investigations: Furfuryl Alcohol
From the People's Republic of China, the Republic of South Africa, and
Thailand
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
EFFECTIVE DATE: June 27, 1994.
FOR FURTHER INFORMATION CONTACT: Erik Warga or Ellen Grebasch at (202)
482-0922 or (202) 482-3773, respectively, 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
Initiation of Investigations
The Petition
On May 31, 1994, we received a petition in proper form filed by QO
Chemicals, Inc. (petitioner), the sole U.S. producer of furfuryl
alcohol. Petitioner filed supplements to the petition on June 6, 15,
16, and 17, 1994.
In accordance with 19 CFR 353.12, petitioner alleges that imports
of furfuryl alcohol from the People's Republic of China (PRC),
Thailand, and the Republic of South Africa (South Africa) are being, or
are likely to be, sold in the United States at less than fair value
within the meaning of section 731 of the Tariff Act of 1930, as amended
(the Act), and that such imports are materially injuring, or threaten
material injury to, a U.S. industry.
Petitioner states that it has standing to file the petition because
it is an interested party, as defined under section 771(9)(C) of the
Act, and it is the sole domestic producer of furfuryl alcohol. If any
interested party, as described under paragraphs (C), (D), (E), or (F)
of section 771(9) of the Act, wishes to register support for, or
opposition to, this petition, it should file a written notification
with the Assistant Secretary for Import Administration.
Scope of Investigations
The product covered by these investigations is furfuryl alcohol
(C4H3OCH2OH). Furfuryl alcohol is a primary alcohol, and
is colorless or pale yellow in appearance. It is used in the
manufacturer of resins and as a wetting agent and solvent for coating
resins, nitrocellulose, cellulose acetate, and other soluble dyes.
The product subject to these investigations is classifiable under
subheading 2932.13.00 of the Harmonized Tariff Schedule of the United
States (HTSUS). Although the HTSUS subheading is provided for
convenience and Customs purposes, our written description of the scope
of these investigations is dispositive.
United States Price and Foreign Market Value
People's Republic of China
Petitioner based United States Price (USP) on FOB PRC port, C&F
U.S. port, and CIF U.S. port, price quotes from PRC producers through
their representative U.S. trading companies. Adjustments were made for
foreign inland freight, ocean freight, and marine insurance. Petitioner
based inland freight on the distance from the PRC producers of the
subject merchandise to the PRC port of export. Freight transportation
charges were valued using Indian surrogate data. (See description of
non-market economy (NME) below methodology). Ocean freight and marine
insurance charges were estimated by comparing per-unit U.S. IM-145
customs value import statistics to per-unit U.S. IM-145 customs value
import statistics to per-unit U.S. IM-145 CIF import statistics.
Petitioner asserts that the PRC is a NME within the meaning of
sections 771(18)(A) and (C) of the Act and in accordance with section
773(c) of the Act. Accordingly, foreign market value (FMV) should be
based on the producer's factors of production, valued in a surrogate
market economy country. The Department has determined in previous
investigations that the PRC is a NME, and the presumption of NME status
continues for the initiation of this investigation. See, e.g., Final
Determination of Sales at Less Than Fair Value: Sebasic Acid from the
People's Republic of China, (59 FR 28053, May 31, 1994).
Absent evidence that a particular NME country government determines
which of its factories shall produce for export to the United States,
we intend, for purposes of the investigation from the PRC, to base FMV
only on those factories that produced furfuryl alcohol sold to the
United States during the period of investigation (POI).
In the course of this investigation, parties will have the
opportunity to provide relevant information related to the issues of
the PRC's NME status and granting of separates rates to individual
exporters. See Final Determination of Sales at Less Than Fair Value:
Silicon Carbide from the PRC (59 FR 22585, May 2, 1994).
Petitioners based the factors of production on the production
process used by PRC producers of the subject merchandise and valued
these factors, where possible, on publicly available published
information from the surrogate country, India. Where certain values
were not available from Indian sources, petitioner has used values from
Pakistan and Indonesia. These countries have been determined to be
appropriate surrogates for the PRC. See November 29, 1993, memorandum
from Rob Straw, Office of Policy to the File, Antidumping Investigation
of Paper Clips from the PRC, A-570-826. For purposes of these
initiations, we have accepted, pursuant to section 773 (c)(4) of the
Act, petitioner's view that India, Pakistan, and Indonesia are
appropriate surrogate countries.
Pursuant to section 773(c)(1) of the Act, petitioner determined FMV
on the basis of the value of factors of production specified in section
773(c)(3) of the Act. These factors included materials, energy, labor
costs and a percentage for factory overhead based on information from
India. Petitioner then added the statutory minimum of ten percent for
general expenses and eight percent for profit, as well as an amount for
packing.
We disregarded certain factor values where the inputs were based on
prices in the United States because (1) petitioner failed to follow the
Department's established hierarchy regarding selection of surrogate
countries for the PRC, with respect to factor valuation, and (2)
petitioner provided no basis for determining that United States values
are representative of the appropriate surrogate country values.
Based on a comparison of USP to FMV, the recalculated dumping
margins ranged from 225.42 percent to 320.69 percent.
South Africa
Petitioner based USP for South Africa on IM-145 data. Petitioner
adjusted for foreign inland freight, ocean freight and marine insurance
charges. Ocean freight and marine insurance charges were estimated by
comparing per-unit U.S. IM-145 customs value import statistics to per-
unit U.S. IM-145 CIF import statistics.
Petitioner based FMV on a domestic price quote from a producer of
the subject merchandise in South Africa to a home market customer. An
adjustment was made for foreign inland freight to arrive at an ex-
factory price. Petitioner then added VAT to both the FMV and USP.
Based on a comparison of USP to FMV, the dumping margin alleged by
petitioner is 68 percent.
Thailand
Petitioner based USP for Thailand on U.S. IM-145 Customs data.
Petitioner adjusted for foreign inland freight, ocean freight and
marine insurance charges. Petitioner calculated inland freight charges
based on the distance from the Thai producer's plant to the port of
export. Ocean freight and marine insurance charges were estimated by
comparing per-unit U.S. IM-145 customs value import statistics to per-
unit U.S. IM-145 CIF import statistics.
Petitioner based FMV on constructed value (CV) because it claimed
that the Thai market was not viable and that home market and third
country prices provided in the petition represented sales that were
made below the cost of production (COP) and therefore were not
appropriate bases for calculating FMV.
Petitioner provided a sales price from a Thai producer to a home
market customer, and third country prices to Germany and the
Netherlands, based on 1993 Thai export statistics to these countries.
We did not use the Thai sales price to the home market customer because
the source of the information could not be substantiated. Petitioner's
claim that the home market is not viable is moot because they have been
unable to obtain a substantiated home market sales price in Thailand.
We rejected prices to third countries because these prices were found
to be below COP, as described below.
Allegations of Home Market and Third Country Sales Below Cost of
Production: Thailand
Petitioner alleged that a Thai producer is selling the subject
merchandise in the home market at prices below its COP. This allegation
is based on a comparison of a domestic price obtained in Thailand with
the Thai producer's COP for the subject merchandise. Because the
domestic sales price from Thailand is unsubstantiated, there is no need
to address petitioner's home market COP allegation. See ``Review of
Estimated COP and Constructed Value for Furfuryl Alcohol Memorandum,''
dated June 17, 1994, which is on file in the Central Records Unit, at
the Department of Commerce.
Petitioner also alleged that the Thai producer's sales prices to
Germany and the Netherlands were also made at prices below COP. This
allegation is based on a comparison of the third country prices to
Germany and to the Netherlands (based on 1993 Thai export statistics to
these countries) to the Thai producer's calculated COP. A comparison of
prices to Germany and the Netherlands to the Thai producer's COP for
the subject merchandise indicates sales below cost. If the Department
determines after these initiations that the home market is not viable
and the Department uses third country prices in Germany or the
Netherlands for purposes of comparison to USP, we will initiate
separate cost investigations at that time.
Therefore, for purposes of this initiation, in accordance with
773(e)(1) of the Act, we are accepting petitioner's estimate of CV as
the only appropriate basis for FMV. Petitioners based CV on costs
incurred by a Thai producer, and its own manufacturing experience
adjusted for differences in costs between the United States and
Thailand. An amount for selling, general and administrative expenses
and the statutory minimum for profit were added to the cost of
manufacturer. Petitioner added an amount for export packing to arrive a
total CV.
Based on a comparison of USP to FMV, the recalculated dumping
margin is 72.35 percent.
Fair Value Comparisons
Based on the data provided by the petitioner, there is reason to
believe that imports to furfuryl alcohol from the PRC, the Republic of
South Africa, and Thailand are being, or likely to be, sold at less
than fair value. If it becomes necessary at a later date to consider
the petition as a source of best information available, we may review
the calculations used to derive the allegations.
Initiation of Investigations
We have examined the petitions on furfuryl alcohol and have found
that they meet the requirements of section 732(b) of the Act and 19 CFR
353.13(a). Therefore, we are initiating antidumping duty investigations
to determine whether imports of furfuryl alcohol from the PRC, the
Republic of South Africa, and Thailand are being, or are likely to be,
sold in the United States at less than fair value. If these
investigations proceed normally, we will make our preliminary
determinations by November 7, 1994.
ITC Notification
Section 732(d) of the Act requires us to notify the ITC of these
actions, and we have done so.
Preliminary Determination by the ITC
The ITC will determine by July 15, 1994, whether there is a
reasonable indication that imports to furfuryl alcohol from the PRC,
Thailand, and the Republic of South Africa are causing material injury,
or threaten to cause material injury, to a U.S. industry. A negative
ITC determination will result in the investigations being terminated;
otherwise, these investigations will proceed according to statutory and
regulatory time limits.
This notice is published pursuant to section 732(c)(2) of the Act
and 19 CFR 353.13(b).
Dated: June 20, 1994.
Susan G. Esserman,
Assistant Secretary for Import Administration.
[FR Doc. 94-15535 Filed 6-24-94; 8:45 am]
BILLING CODE 3510-D5-M
