[Federal Register Volume 61, Number 146 (Monday, July 29, 1996)]
[Notices]
[Pages 39437-39439]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-19212]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-821-803]
Titanium Sponge From the Russian Federation: Preliminary Results
of Antidumping Duty Administrative Review
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
ACTION: Notice of Preliminary Results of Antidumping Duty
Administrative Review.
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SUMMARY: In response to requests from Berezniki Titanium-Magnesium
Works (AVISMA), RMI Titanium Company (RMI, a U.S. importer of titanium
sponge), Interlink Metals and Chemicals, Inc. (Interlink), and Titanium
Metals Corporation (TIMET, a petitioner), the Department of Commerce
(the Department) is conducting an administrative review of the
antidumping duty order on titanium sponge from the Russian Federation
(Russia). This notice of preliminary results covers the period August
1, 1994 through July 31, 1995. This review covers one manufacturer/
exporter, AVISMA, and two trading companies, Interlink and Cometals,
Inc. (Cometals). The review indicates the existence of dumping margins
during this period.
We have preliminarily determined that sales have been made below
the normal value (NV). If these preliminary results are adopted in our
final results of administrative review, we will instruct the U.S.
Customs Service (Customs) to assess antidumping duties equal to the
difference between the United States price (USP) and the NV. Interested
parties are invited to comment on these preliminary results. Parties
who submit argument in this proceeding are requested to submit with the
argument: (1) a statement of the issue; and (2) a brief summary of the
argument.
EFFECTIVE DATE: July 29, 1996.
FOR FURTHER INFORMATION CONTACT:
Amy S. Wei or Zev Primor, Office of AD/CVD Enforcement, Office 4,
Import Administration, International Trade Administration, U.S.
Department of Commerce, 14th Street and Constitution Avenue, N.W.,
Washington, D.C. 20230; telephone (202) 482-5253.
SUPPLEMENTARY INFORMATION:
The Applicable Statute
Unless otherwise indicated, all citations to the Tariff Act of
1930, as amended, (the Act) are references to the provisions effective
January 1, 1995, the effective date of the amendments made to the Act
by the Uruguay Rounds Agreements Act (URAA). In addition, unless
otherwise indicated, all citations to the Department's regulations are
to the current regulations, as amended by the interim regulations
published in the Federal Register on May 11, 1995 (60 FR 25130).
Background
The Department published an antidumping finding on titanium sponge
from the Union of Soviet Socialist Republics (U.S.S.R.) on August 28,
1968 (33 FR 12138). In December 1991, the U.S.S.R. divided into fifteen
independent states. To conform to these changes, the Department changed
the original antidumping finding into fifteen findings applicable to
the each of the former republics of the U.S.S.R. (57 FR 36070, August
12, 1992).
The Department published a notice of ``Opportunity To Request an
Administrative Review'' of the antidumping duty finding for this review
period on August 1, 1995 (60 FR 39150). On August 28, 1995, AVISMA,
RMI, and Interlink requested that the Department conduct an
administrative review of the antidumping finding on titanium sponge
from Russia for one manufacturer/exporter, AVISMA, and one trading
company, Interlink, covering the period August 1, 1994 through July 31,
1995. On August 31, 1995, TIMET requested that the Department conduct
the same administrative review for AVISMA and another trading company,
Cometals. We initiated the review on September 15, 1995 (60 FR 47930)
and on October 12, 1995 (60 FR 53164) (Cometals was inadvertently
omitted in the previous initiation notice).
The Department extended the time limit for the deadline for the
preliminary results of review because it was not practicable to
complete this review within the time limit mandated by Section
751(a)(3)(A) of the Act. See Titanium Sponge From the Russian
Federation; Antidumping Duty Administrative Review; Time Limits, 61 FR
20795 (May 8, 1996).
The Department is now conducting this administrative review in
accordance with section 751 of the Act.
Scope of the Review
The product covered by this administrative review is titanium
sponge from Russia. Titanium sponge is chiefly used for aerospace
vehicles, specifically, in construction of compressor blades and
wheels, stator blades, rotors, and other parts in aircraft gas turbine
engines. Imports of titanium sponge are currently classifiable under
the harmonized tariff schedule (HTS) subheading 8108.10.50.10. The HTS
subheading is provided for convenience and U.S. Customs purposes. Our
written description of the scope of this proceeding is dispositive.
The period of review (POR) is August 1, 1994 through July 31, 1995,
covering one manufacturer/exporter, AVISMA, and two trading companies,
Interlink and Cometals.
Verification
As provided in section 782(i) of the Act, we verified the
information provided by the respondents by using standard verification
procedures, including on-site inspection of the manufacturer's
facilities, examination of relevant sales and financial records, and
selection of original documentation containing relevant information.
Our verification results are outlined in the public versions of the
verification reports, which are on file in the public file of the
Central Records Unit (Room B-099 in the Department of Commerce).
United States Price (USP)
AVISMA
In its questionnaire response, AVISMA stated that, prior to May
1995, it was not informed at the time of sale of the ultimate
destination of merchandise that was sold by its resellers. For this
reason, prior to May 1995, AVISMA is not considered to have shipped to
the United States.
[[Page 39438]]
We determined that AVISMA's sales after May 1995 entered the United
States under temporary importation bonds (TIBs). This entry information
was provided to the Department by respondents and confirmed by the U.S.
Customs Service (Customs). At this time, because merchandise entered
under a TIB is not entered for consumption, such merchandise entered
under TIB is not subject to the antidumping duty finding. See Titanium
Metals Corp. v. The United States, Slip Op. 95-153, August 30, 1995.
Therefore, we preliminarily determine that AVISMA did not export
for consumption any subject merchandise to the United States during the
POR. If these preliminary results are adopted in our final results of
review, AVISMA will continue to be subject to the current Russia-wide
cash deposit rate of 83.96 percent, which is the rate established in
the final results of the most recent administrative review of titanium
sponge from Russia (61 FR 9676, March 11, 1996).
Interlink and Cometals
Because Interlink and Cometals are located in market-economy
countries, we are calculating a separate rate for each reseller. In
calculating USP for Interlink and Cometals, we used export price, as
defined in section 772(a) of the Act. We excluded those sales made to
the United States which entered the United States under TIBs.
Petitioner and respondents provided information regarding TIB entries,
and we are able to confirm this information regarding TIB entries, and
we were able to confirm this information with Customs.
We calculated export price based on the price to unrelated
purchasers in the United States. We made deductions, where appropriate,
for rebates, ocean freight, warehouse expenses, insurance, brokerage
and handling, inland freight, and U.S. duty charges. We made minor
changes to U.S. expenses reported at verification. We valued inland
freight, brokerage, ocean freight, and marine insurance expenses
incurred in bringing the subject merchandise from the Russian plant to
the resellers' warehouses using surrogate data based on Brazilian
freight costs, where appropriate. See Notice of Preliminary Results of
the Antidumping Duty Administrative Review of Chrome-Plated Lug Nuts
from the People's Republic of China, August 16, 1995, 60 FR 42504,
42506. We selected Brazil as the surrogate country for the reasons
explained in the ``Surrogate Country Selection'' section of this
notice.
No other adjustments to USP were claimed or allowed.
Surrogate Country Selection
For all companies located in non-market economy (NME) countries,
section 773(c)(1) of the Act provides that the Department shall
determine the normal value on the basis of the value of the factors of
production if (1) the subject merchandise is exported from an NME
country, and (2) the available information does not permit the
calculation of normal value under section 773(a) of the Act. Because
the Department considers Russia an NME country and AVISMA is located in
Russia, we are not able to determine normal value on the basis of
AVISMA's costs and prices. Therefore, we have applied surrogate values
to the factors of production to determine normal value.
We calculated normal value based on factors of production provided
by AVISMA, in accordance with sections 773(a)(3) and 773(c) of the Act
and 19 CFR 353.52 of the Department's regulations. We determined that
Brazil is comparable to the Russian Federation in terms of per capita
gross national product (GNP), the growth rate in per capita GNP, and
the national distribution of labor. In addition, Brazil is a
significant producer of comparable merchandise. therefore, we chose
Brazil as the most comparable surrogate on the basis of the above
criteria and have used publicly available information relating to
Brazil to value the various factors of production. See Memorandum to
Wendy J. Frankel from David Mueller, Titanium Sponge from Russia:
Nonmarket Economy Status and Surrogate Country Selection, November 7,
1995.
Normal Value
To determine the normal value, we valued the factors of production
as follows (for further discussion, see the analysis memorandum for
these preliminary results, on file in the Central Records Unit):
To value raw materials, we used Brazilian import data from
the United Nations Trade Commodity Statistics (UN Trade Statistics) for
January through December 1994. We did not need to convert raw material
factor values because they were reported in U.S. dollars. We adjusted
certain factors' values to reflect the actual purity used in the
production of the subject merchandise. For those raw materials for
which we were unable to obtain publicly available information from
Brazil, we used data provided for use in the final determination of
sales at less than fair value (LTFV) for pure magnesium and alloy
magnesium from the Russian Federation (magnesium from Russia) and in
the respondents' December 4, 1995 submission.
To value truck and railcar freight, we used the rates
reported for use in the final determination of sales at LTFV for
magnesium from Russia. We multiplied these rates by the distances from
the supplier to the plant, as reported by AVISMA. Because these rates
were reported in Brazilian currency, we adjusted the rates to reflect
inflation through the POR using the wholesale price indices (WPI)
published by the International Monetary Fund (IMF).
For energy, natural gas was valued using information from
the UN Trade Statistics. For electricity, we used the ``large industry
user'' rate from Brazil's electricity tariff schedule that AVISMA would
have received had it been an electricity consumer in Brazil during the
POR. This decision was based on finding that AVISMA's level of
electricity usage during the POR was similar to the profile of ``large
industrial user'' in the final determination of sales at LTFV for
magnesium from Russia. To confirm that AVISMA would have received this
rate, we divided the total number of kilowatt hours used during the POR
for titanium sponge production by the number of hours in the POR, which
demonstrated that AVISMA's kilowatt use was higher than the minimum
necessary to receive the ``large industrial user'' rate in effect in
Brazil during the POR.
Although petitioner has alleged the existence of government
subsidies in Brazil to reduce electricity rates for ferroalloy
production (See Letter to Susan G. Esserman from DeKieffer, Dibble &
Horgan, TIMET's Response to Submission of Wilmer, Cutler & Pickering
Regarding Surrogate Country Selection, December 4, 1995), we have not
found any past final affirmative determinations regarding electricity
subsidization in Brazil. In fact, in a final negative determination of
silicon metal from Brazil, the Department found no evidence of
preferential electricity rates. See Final Negative Countervailing Duty
Determination: Silicon Metal from Brazil (56 FR 26988, June 12, 1991)
at 26990.
For direct labor, we were unable to find any recent
publicly available information on Brazilian labor rates. Therefore, we
used the unskilled and skilled labor rates reported by the Foreign
Commercial Service office in Belo Horizonte, Brazil and from the Bureau
of International Labor Affairs of the U.S. Department of Labor. These
labor rates were used in the final determination of sales at LTFV for
magnesium from Russia. See Calculation Memorandum: Final
[[Page 39439]]
Antidumping Duty Determination, Pure Magnesium and Alloy Magnesium from
the Russian Federation, March 22, 1995, at 2. Because the skilled labor
rate was reported in Brazilian currency, we adjusted the rate to
reflect inflation through the POR using the WPI published by the IMF.
For factory overhead, we used expense ratios based on
elements of constructed-value data reported in the antidumping duty
administrative review of silicon metal from Brazil, covering the period
July 1, 1994 through June 31, 1995. In order to calculate expense
ratios for selling, general, and administrative (SG&A) expenses and
profit, we calculated simple averages of the SG&A and profit ratios
taken from the 1994 financial statements in the above-named review.
For packing materials, we used information provided in the
UN Trade Statistics from Brazil from January through December 1994. We
included surrogate freight costs for the delivery of packing materials
to the plant reported for use in the final determination of sales at
LTFV for magnesium from Russia. We valued packing labor using the same
labor rates as used in direct labor above.
Currency Conversion
We made currency conversions in accordance with section 773A(a) of
the Act. Currency conversions were made at rates certified by the
Federal Reserve Bank and Dow Jones Business Information Services.
Preliminary Results
As a result of this review, we preliminarily determine that the
following weighted-average dumping margins exist:
------------------------------------------------------------------------
Margin
Manufacturer/exporter Period (percent)
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Interlink Metals and Chemicals, Inc..... 8/1/94-7/31/95 0.00
Cometals, Inc........................... 8/1/94-7/31/95 89.92
Russia-wide rate........................ 8/1/94-7/31/95 83.96
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Parties to this proceeding may request disclosure within five days of
publication of this notice and any interested party may request a
hearing within 10 days of publication. Any hearing, if requested, will
be held 44 days after the date of publication, or the first working day
thereafter. Interested parties may submit case briefs and/or written
comments no later than 30 days after the date of publication. Rebuttal
briefs and rebuttals to written comments, limited to issues raised in
such briefs or comments, may be filed no later than 37 days after the
date of publication. The Department will publish a notice of the final
results of the administrative review, which will include the results of
its analysis of issues raised in any such written comments or at the
hearing, within 120 days from the issuance of these preliminary
results.
The Department shall determine, and Customs shall assess,
antidumping duties on all appropriate entries. Individual differences
between USP and NV may vary from the percentages stated above. The
Department will issue appraisement instructions directly to Customs.
The final results of this review shall be the basis for the assessment
of antidumping dumping duties on entries of merchandise covered by the
determination and for future deposits of estimated duties.
Furthermore, the following deposit requirements will be effective
upon completion of the final results of this administrative review for
all shipments of titanium sponge from the Russian Federation entered,
or withdrawn from warehouse, for consumption on or after the
publication date of the final results of these administrative reviews,
as provided by section 751(a)(1) of the Act: (1) the cash deposit rates
for AVISMA, Interlink, and Cometals will be the rates established in
the final results of this administrative review; (2) for merchandise
exported by manufacturers or exporters not covered in this review but
covered in the original LTFV investigation or a previous review and
have a separate rate, the cash deposit rate will continue to be the
most recent rate published in the final determination or final results
for which the manufacturer or exporter received a company-specific
rate; (3) for Russian manufacturers or exporters not covered in the
LTFV investigation or in this or prior administrative reviews, the cash
deposit rate will continue to be the Russia-wide rate; and (4) the cash
deposit rate for non-Russian exporters of subject merchandise from
Russia who were not covered in the LTFV investigation or in this or
prior administrative reviews will be the rate applicable to the Russian
supplier of that exporter. These deposit rates, when imposed, shall
remain in effect until publication of the final results of the next
administrative review.
This notice serves as a preliminary reminder to importers of their
responsibility under 19 CFR 353.26(b) to file a certificate regarding
the reimbursement of antidumping duties prior to liquidation of the
relevant entries during these review periods. Failure to comply with
this requirement could result in the Secretary's presumption that
reimbursement of antidumping duties occurred and the subsequent
assessment of double antidumping duties.
This administrative review and notice are in accordance with
section 751(a)(1) of the Act (19 U.S.C. 1675(a)(1)).
Dated: July 22, 1996.
Robert S. LaRussa,
Acting Assistant Secretary for Import Administration.
[FR Doc. 96-19212 Filed 7-26-96; 8:45 am]
BILLING CODE 3510-DS-M
