[Federal Register Volume 62, Number 165 (Tuesday, August 26, 1997)]
[Notices]
[Pages 45224-45229]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-22690]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-428-824, A-475-820, A-588-843, A-580-829, A-469-807, A-401-806, and
A-583-828]
Initiation of Antidumping Investigations: Stainless Steel Wire
Rod From Germany, Italy, Japan, Korea, Spain, Sweden, and Taiwan
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
EFFECTIVE DATE: August 26, 1997.
FOR FURTHER INFORMATION CONTACT: James Maeder, at (202) 482-3330; James
Terpstra, at (202) 482-3965; or Erik Warga, at (202) 482-0922, Import
Administration, International Trade Administration, U.S. Department of
Commerce, 14th Street and Constitution Avenue, N.W., Washington, DC
20230.
Initiation of Investigations
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 the Department's regulations are
to the current regulations, as amended by the regulations published in
the Federal Register on May 19, 1997 (62 FR 27296).
The Petition
On July 30, 1997, the Department of Commerce (``the Department'')
received a petition filed in proper form by AL Tech Specialty Steel
Corp., Carpenter Technology Corp., Republic Engineered Steels, Talley
Metals Technology, Inc., and United Steelworkers of America
(``petitioners''). The Department received supplemental information to
the petition on August 6 and 14, 1997.
In accordance with section 732(b) of the Act, petitioners allege
that imports of stainless steel wire rod from Germany, Italy, Japan,
Korea, Spain, Sweden, and Taiwan 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 Act, and that such imports are materially injuring
an industry in the United States.
The Department finds that petitioners have standing to file the
petition because they are interested parties as defined in section
771(9)(C) and (D) of the Act and they have demonstrated sufficient
industry support (see discussion below).
Scope of Investigations
For purposes of these investigations, certain stainless steel wire
rod (``SSWR'') comprises products that are hot-rolled or hot-rolled
annealed and/or pickled and/or descaled rounds, squares, octagons,
hexagons or other shapes, in coils, that may also be coated with a
lubricant containing copper, lime or oxalate. SSWR is made of alloy
steels containing, by weight, 1.2 percent or less of carbon and 10.5
percent or more of chromium, with or without other elements. These
products are manufactured only by hot-rolling or hot-rolling,
annealing, and/or pickling and/or descaling, and are normally sold in
coiled form, and are of solid cross-section. The majority of SSWR sold
in the United States is round in cross-sectional shape, annealed and
pickled, and later cold-finished into stainless steel wire or small-
diameter bar.
The most common size for such products is 5.5 millimeters or 0.217
inches in diameter, which represents the smallest size that normally is
produced on a rolling mill and is the size that most wire drawing
machines are set up to draw. The range of SSWR sizes normally sold in
the United States is between 0.20 inches and 1.312 inches diameter. Two
stainless steel grades SF20T and K-M35FL are excluded from the scope of
the investigation. The chemical makeup for the excluded grades are as
follows:
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SF20T
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Carbon............................... 0.05 max............... Chromium............... 19.00/21.00.
Manganese............................ 2.00 max............... Molybdenum............. 1.50/2.50.
Phosphorous.......................... 0.05 max............... Lead................... added (0.10/0.30).
Sulfur............................... 0.15 max............... Tellurium.............. added (0.03 min).
Silicon.............................. 1.00 max...............
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K-M35FL
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Carbon............................... 0.015 max.............. Nickel................. 0.30 max.
Silicon.............................. 0.70/1.00.............. Chromium............... 12.50/14.00.
Manganese............................ 0.40 max............... Lead................... 0.10/0.30.
[[Page 45225]]
Phosphorous.......................... 0.04 max............... Aluminum............... 0.20/0.35.
Sulfur............................... 0.03 max...............
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The products under investigation are currently classifiable under
subheadings 7221.00.0005, 7221.00.0015, 7221.00.0030, 7221.00.0045, and
7221.00.0075 of the Harmonized Tariff Schedule of the United States
(HTSUS). Although the HTSUS subheadings are provided for convenience
and customs purposes, the written description of the scope of these
investigations is dispositive.
As we discussed in the preamble to the new regulations (62 FR at
27323), we are setting aside a period for interested parties to raise
issues regarding product coverage. The Department encourages all
interested parties to submit such comments by September 15, 1997.
Comments should be addressed to Import Administration's Central Records
Unit at Room 1874, U.S. Department of Commerce, Pennsylvania Avenue and
14th Street, N.W., Washington, D.C. 20230. This period of scope
consultation is intended to provide the Department with ample
opportunity to consider all comments and consult with parties prior to
the issuance of the preliminary determination.
Determination of Industry Support for the Petition
Section 732(b)(1) of the Act requires that a petition be filed on
behalf of the domestic industry. Section 732(c)(4)(A) of the Act
provides that a petition meets this requirement if the domestic
producers or workers who support the petition account for: (1) At least
25 percent of the total production of the domestic like product; and
(2) more than 50 percent of the production of the domestic like product
produced by that portion of the industry expressing support for, or
opposition to, the petition.
Section 771(4)(A) of the Act defines the ``industry'' as the
producers of a domestic like product. Thus, to determine whether the
petition has the requisite industry support, the statute directs the
Department to look to producers and workers who account for production
of the domestic like product. The International Trade Commission
(``ITC''), which is responsible for determining whether ``the domestic
industry'' has been injured, must also determine what constitutes a
domestic like product in order to define the industry. While both the
Department and the ITC must apply the same statutory provision
regarding the domestic like product (section 771(10) of the Act), they
do so for different purposes and pursuant to separate and distinct
authority. In addition, the Department's determination is subject to
limitations of time and information. Although this may result in
different definitions of the domestic like product, such differences do
not render the decision of either agency contrary to the
law.1
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\1\ See Algoma Steel Corp., Ltd. v. United States, 688 F. Supp.
639, 642-44 (CIT 1988); High Information Content Flat Panel Displays
and Display Glass Therefor from Japan: Final Determination;
Rescission of Investigation and Partial Dismissal of Petition, 56 FR
32376, 32380-81 (July 16, 1991).
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Section 771(10) of the Act defines domestic like product as ``a
product which is like, or in the absence of like, most similar in
characteristics and uses with, the article subject to an investigation
under this title.'' Thus, the reference point from which the domestic
like product analysis begins is ``the article subject to an
investigation,'' i.e., the class or kind of merchandise to be
investigated, which normally will be the scope as defined in the
petition.
The petition refers to the single domestic like product defined in
the ``Scope of Investigation'' section, above. The Department has no
basis on the record to find the petition's definition of the domestic
like product to be inaccurate. In this regard, we have found no basis
on which to reject petitioners' representations that there are clear
dividing lines, in terms of characteristics and uses, between the
product under investigation and other coiled steel products. The
Department has, therefore, adopted the domestic like product definition
set forth in the petition. In this case, petitioners established
industry support substantially above the statutory requirement.
Accordingly, the Department determines that the petition is filed on
behalf of the domestic industry within the meaning of section 732(b)(1)
of the Act.
Export Price and Normal Value
The following are descriptions of the allegations of sales at less
than fair value upon which our decisions to initiate these
investigations are based. Should the need arise to use any of this
information in our preliminary or final determinations for purposes of
facts available under section 776 of the Act, we may re-examine the
information and revise the margin calculations, if appropriate.
Germany
Petitioners identified Krupp Edelstahlprofile (``Krupp'') as the
sole exporter and producer of SSWR from Germany. Petitioners based
export price on recent U.S. sales by Krupp during June 1997 for the
SSWR grades most commonly exported to the United States from Germany.
Petitioners calculated net U.S. prices by subtracting an estimate of
the costs incurred to transport the SSWR rod from the factory to the
U.S. port. Petitioners did not subtract costs incurred to transport the
SSWR from the U.S. port to the customer's location in the United
States.
Petitioners calculated the cost of international freight based upon
the average difference in the CIF values and the U.S. Customs values
reported in the official U.S. import statistics. Petitioners subtracted
amounts for U.S. import duties based on the 1997 import duty rate.
Petitioners also subtracted amounts for the U.S. harbor maintenance fee
and for the U.S. merchandise processing fee.
With respect to normal value (``NV''), petitioners obtained prices
for recent sales of SSWR by Krupp to customers in Germany from foreign
market research. Petitioners calculated net home market prices for
sales made in Germany by subtracting an amount for delivery costs as
obtained through foreign market research from the reported gross home
market sales prices.
In addition, the petitioners provided information demonstrating
reasonable grounds to believe or suspect that sales of SSWR in the home
market were made at prices below the fully allocated cost of production
(``COP''), within the meaning of section 773(b) of the Act, and
requested that the Department conduct a country-wide sales below cost
investigation.
Pursuant to section 773(b)(3) of the Act, COP consists of the cost
of manufacturing (``COM''), selling, general, and administrative
expenses (``SG&A''), and packing. To calculate COP, petitioners based
COM, with the exception of depreciation, on their own production
experience, adjusted for known differences between costs incurred to
produce SSWR in the United States and costs incurred for producing the
merchandise in Germany.
[[Page 45226]]
To calculate depreciation, petitioners relied upon Krupp's 1996
consolidated financial statements. To derive the direct materials,
energy, direct labor and factory overhead costs, petitioners obtained
cost data from two U.S. producers and relied upon the average costs of
those producers. One of the U.S. producers manufactures its own billets
while the other purchases all billets consumed. The foreign market
research obtained by the petitioner indicated that Krupp produces its
own billets. Therefore, we recalculated the submitted COM based on the
cost data of the U.S. company that produces its own billets.
To calculate SG&A, petitioners relied upon expense rates of
nineteen German companies, only one of which appears to be involved in
the metal manufacturing industry. We recalculated SG&A using the
reported rate for the company that appears to be in an industry similar
to that which manufactures steel products. Petitioners calculated
financing expenses using Krupp's 1996 consolidated audited financial
statements. Petitioners added the average packing costs reported by the
U.S. producers to COP. Based upon the comparison of the adjusted prices
of the foreign like product in the home market to the calculated COP,
we find reasonable grounds to believe or suspect that sales of the
foreign like product were made below the COP within the meaning of
section 773(b)(2)(A)(i) of the Act (see Initiation Checklist, dated
August 19, 1997). Accordingly, with respect to the German case, the
Department is initiating a county-wide cost investigation.
Pursuant to sections 773(a)(4), 773(b) and 773(e) of the Act,
petitioners also based NV for sales in Germany on constructed value
(``CV''). For purposes of this initiation, we accepted CV as the
appropriate basis for NV. Petitioners calculated CV using the same COM,
SG&A, and interest expense figures used to compute German home market
costs. We adjusted the CV as noted above in the discussion of COP.
Consistent with section 773(e)(2) of the Act, petitioners also added to
CV an amount for profit. Profit was based upon Krupp's 1996
consolidated audited financial statements.
The revised average dumping margins in the petition, based on the
comparisons between Krupp's U.S. prices and the revised constructed
values, range from 17.17 percent to 21.28 percent.
Italy
Petitioners identified four exporters and producers of SSWR: Cogne
Acciai Speciali SrL (``Cogne''); Rodacciai; Acciaierie Valbruna SrL
(``Valbruna''); and Acciaierie di Bolzano (``Bolzano''). Petitioners
based export price on actual U.S. sales by Cogne and by Valbruna/
Bolzano during November 1996 for the SSWR grades most commonly exported
to the United States from Italy. Petitioners calculated net U.S. prices
by subtracting an estimate of the costs incurred to transport the
stainless wire rod from the factory to the customer's location in the
United States.
Petitioners calculated the cost of international freight based upon
the average difference in the CIF values and the U.S. Customs values
reported in the official U.S. import statistics. Petitioners estimated
U.S. inland freight costs based on the distance from the U.S. port of
entry to the U.S. customer's location. Petitioners subtracted amounts
for U.S. import duties and customs user fees. Petitioners also
subtracted amounts for the U.S. harbor maintenance fee and for the U.S.
merchandise processing fee. Petitioners added duty drawback to the U.S.
prices for comparisons that involved grades of SSWR that include
molybdenum or titanium based on information obtained from foreign
market research.
With respect to NV, petitioners obtained home market prices through
foreign market research. Petitioners calculated net home market prices
for sales in Italy by subtracting the estimated delivery costs reported
in the foreign market research. Petitioners converted home market
prices quoted in lire per kilogram to U.S. dollars per pound by using a
conversion ratio of one kilogram equals 2.2046 pounds and the Italian
lire/U.S. dollar exchange rate in effect during the period in which the
U.S. sales occurred. The exchange rates used to make currency
conversions were the rates published in the International Financial
Statistics for November 1996, the month of the U.S. sales.
Petitioners made a circumstance of sale adjustment for imputed
credit expenses by subtracting home market credit expenses and by
adding U.S. imputed credit expenses to the net home market prices
calculated in the petition. Petitioners calculated home market imputed
credit expenses based on the average payment period, reported in the
foreign market research, of 90 days, and the average lending rate in
Italy published by the International Financial Statistics for the
fourth quarter of 1996. Petitioners calculated U.S. imputed credit
expenses based on payment terms reported in the foreign market research
of 60 days and the average lending rate in the United States published
in the International Financial Statistics. Petitioners did not adjust
the reported prices for differences in packing costs because
petitioners assumed that packing costs were the same for home market
sales and for U.S. sales.
According to the foreign market research, Italian producers impose
a surcharge per kilogram for wire rod with a diameter of 6 millimeters
to 13 millimeters. Petitioners subtracted this amount from NV as a
difference-in-merchandise adjustment when the price comparisons
involved a U.S. sale of wire rod with a diameter of less than 6
millimeters and wire rod sold in Italy with a diameter between 6
millimeters and 13 millimeters.
Comparison of NV and net U.S. prices for sales of SSWR from Italy
results in estimated dumping margins that range from 33.29 percent to
46.79 percent.
Japan
Petitioners identified four exporters and producers of SSWR: Aichi
Steel Works Ltd.; Daido Steel Co. Ltd. (``Daido''); Nippon Steel Corp.
(``Nippon''); and Sumitomo Metal Industries Ltd. Petitioners based
export prices on actual, port-of-export, prices for U.S. sales made by
Nippon and Daido to unaffiliated Japanese trading companies during the
fourth quarter of 1996 for the SSWR grades most commonly exported to
the United States from Japan. Petitioners calculated net U.S. prices by
subtracting amounts to deliver the subject merchandise from the factory
to the port of export. This information was obtained from foreign
market research.
Petitioners did not calculate imputed credit expenses for the U.S.
sales because the foreign market research indicated letter of credit
payments terms for U.S. sales. Petitioners converted U.S. prices quoted
in yen per metric ton to U.S. dollars per metric ton based on the
average exchange rate published in the International Financial
Statistics for the fourth quarter of 1996, the period in which U.S.
sales occurred.
With respect to NV, petitioners obtained from the foreign market
research home market price quotations for actual sales from Nippon and
Daido to unrelated distributors in Japan. These prices were quoted in
Japanese yen on a delivered basis. Petitioners calculated net home
market prices by subtracting an amount for average delivery costs
incurred by Nippon and Daido. Petitioners converted home market prices
quoted in yen per metric ton to U.S. dollars per metric ton based on
the average exchange rate published in the International Financial
Statistics for the
[[Page 45227]]
fourth quarter of 1996, the period in which U.S. sales occurred.
Petitioners made a circumstance of sale adjustment for imputed
credit expenses by subtracting home market credit expenses from the
reported home market prices. Petitioners did not add U.S. imputed
credit expenses to the net home market prices since the foreign market
research showed letter of credit payment terms for U.S. sales.
Petitioners calculated home market imputed credit expenses based on the
average payment period reported in the foreign market research of 115
days, and the average annual lending rate in Japan for the first
quarter of 1996, the most current annual lending rate published by the
International Financial Statistics for Japan. Petitioners also adjusted
the reported prices for differences in packing costs by subtracting
home market packing costs and by adding packing costs incurred for U.S.
sales to the reported net home market sales price.
Comparison of NV and net U.S. prices for sales of SSWR from Japan
results in estimated dumping margins that range from 14.53 percent to
29.49 percent.
Korea
Petitioners identified three Korean exporters and producers of
SSWR: Pohang Iron & Steel Co. Ltd. (``Posco''); Dongbang Special Steel
Co. Ltd. (``Dongbang''); and Sammi Steel Co. Ltd. (``Sammi'').
Petitioners based export price on actual, port-of-export, prices
for U.S. sales made by Posco to unaffiliated trading companies during
the fourth quarter of 1996, for the stainless steel wire rod grades
most commonly exported to the United States from Korea, which they
obtained from foreign market research. In addition, petitioners
calculated net U.S. prices by subtracting from export prices amounts to
deliver the subject merchandise from the factory to the port of export
based on information obtained from foreign market research. Petitioners
added to these prices amounts for duty drawback. Petitioners also
converted the reported U.S. prices from Korean won per metric ton to
U.S. dollars per metric ton based on the average exchange rate
published in the International Financial Statistics for the fourth
quarter of 1996, the period in which the U.S. sales occurred.
With respect to NV, the petitioners obtained actual, delivered home
market prices for Posco from the foreign market research. Petitioners
calculated net home market prices for sales made in Korea by
subtracting amounts for discounts and rebates and delivery costs as
obtained through foreign market research, and by subtracting imputed
credit expenses from the reported gross home market sales prices.
Petitioners calculated imputed credit expenses based on the average
payment period reported in the foreign market research of 75 days, and
the average lending rate in Korea published by the International
Financial Statistics for the fourth quarter of 1996. Petitioners also
adjusted the reported prices for differences in packing costs by
subtracting home market packing costs from the reported home market
prices and by adding packing costs incurred for U.S. sales to the
reported home market prices. Petitioners converted home market prices
from Korean won per metric ton to U.S. dollars per metric ton by using
the Korean won/U.S. dollar exchange rate in effect during the period in
which the U.S. sales occurred. The exchange rates used to make currency
conversions were the rates published in the International Financial
Statistics for the fourth quarter 1996.
Comparison of NV and net U.S. prices for sales of SSWR from Korea
results in estimated dumping margins that range from 23.81 percent to
28.44 percent (see Initiation Checklist, dated August 19, 1997).
Spain
Petitioners identified Roldan, S.A. (``Roldan'') as the sole
exporter and producer of SSWR from Spain. Petitioners based export
price on information obtained through foreign market research for
recent sales by Roldan for the SSWR grades most commonly exported to
the United States from Spain. Petitioners calculated net U.S. prices by
subtracting estimated costs for ocean freight and insurance and for
U.S. duties and fees from reported U.S. prices. Petitioners did not
subtract costs incurred to transport the stainless steel wire rod from
the factory to the port of export and from the U.S. port to the
customer's location in the United States.
Petitioners calculated the cost of international freight based upon
the average difference in the CIF values and the U.S. Customs values
reported in the official U.S. import statistics. Petitioners subtracted
amounts for U.S. import duties and customs user fees. Petitioners also
subtracted amounts for the U.S. harbor maintenance fee and for the U.S.
merchandise processing fee. Petitioners did not calculate imputed
credit expenses for Roldan's U.S. sales because petitioners did not
have information concerning the payment terms for these sales.
With respect to NV, petitioners obtained home market prices through
foreign market research. Petitioners calculated net home market prices
for sales made in Spain by subtracting an amount for delivery costs as
obtained through foreign market research from the reported gross home
market sales prices.
In addition, the petitioners provided information demonstrating
reasonable grounds to believe or suspect that sales of SSWR in the home
market were made at prices below the fully allocated COP, within the
meaning of section 773(b) of the Act, and requested that the Department
conduct a country-wide sales below cost investigation.
Pursuant to section 773(b)(3) of the Act, COP consists of the COM,
SG&A, and packing. To calculate COP, petitioners based COM, with the
exception of depreciation, on their own production experience, adjusted
for known differences between costs incurred to produce SSWR in the
United States and costs incurred for producing the merchandise in
Spain. To calculate depreciation the petitioner relied upon the 1996
consolidated financial statement from Roldan's parent company Acerinox.
To calculate Roldan's SG&A and financing expenses petitioners also
relied upon the 1996 consolidated financial statements from Acerinox.
Petitioners maintain that they relied upon Acerinox's consolidated
financial statements because they were unable to obtain Roldan's
financial statements. Since steel production appears to be the primary
business activity of the consolidated Acerinox Group, we considered it
reasonable to rely on its financial data for determining these costs
for purposes of the petition. Petitioners added to the COP the average
packing costs reported by the U.S. producers. Based upon the comparison
of the adjusted prices of the foreign like product in the home market
to the calculated COP, we find reasonable grounds to believe or suspect
that sales of the foreign like product were made below the COP within
the meaning of section 773(b)(2)(A)(i) of the Act. Accordingly, with
respect to the Spanish case, the Department is initiating a country-
wide cost investigation.
Pursuant to sections 773(a)(4), 773(b) and 773(e) of the Act,
petitioners also based NV on CV. For purposes of this initiation, we
are accepting CV as the appropriate basis for NV. Petitioners
calculated CV using the same COM, SG&A, and interest expense figures
used to compute Spain's home market costs. Consistent with section
773(e)(2) of the Act, petitioners also added to CV an amount for
profit. Profit was based upon
[[Page 45228]]
the consolidated audited financial statements of Acerinox.
Comparison between Roldan's U.S. prices and the constructed values
results in dumping margins that range from 31.00 to 63.39 percent.
Sweden
Petitioners identified Fagersta Stainless AB (``Fagersta'') as the
sole exporter and producer of SSWR from Sweden. Fagersta is a joint
venture company formed by the two of the largest steel producing
companies in Sweden: Avesta Sheffield AB and Sandvik Steel. Petitioners
based export price on U.S. sales by Avesta Sheffield AB during November
1996 of the SSWR most commonly exported to the United States from
Sweden. Petitioners calculated net U.S. prices by subtracting from
export prices an estimate of the costs incurred to transport the SSWR
from the factory to the customer's location in the United States.
Petitioners estimated the cost of international freight based upon
the weighted average difference for certain U.S. ports between the CIF
values and the FOB values reported in the official U.S. import
statistics for November 1996 for imports from Sweden. Petitioners
estimated U.S. inland freight costs based on the distance from the U.S.
port of entry to the U.S. customer's location. Petitioners subtracted
amounts for U.S. import duties, for the U.S. harbor maintenance fee,
and for the U.S. merchandise processing fee. Petitioners added duty
drawback to the U.S. prices for comparisons that involved grades of
SSWR that include molybdenum or titanium based on an amount obtained
through foreign market research.
With respect to NV, petitioners obtained home market prices from
foreign market research. The foreign market research provided
information on the base prices, surcharges, discounts, payment terms
and estimated sale-by-sale delivery costs for each of the home market
sales. Petitioners added the surcharges to the reported base prices,
and subtracted the discounts and estimated sale-by-sale delivery costs.
Petitioners converted home market prices quoted in Swedish kronor per
kilogram to U.S. dollars per pound by using a conversion ratio of one
kilogram to 2.2046 pounds and the Swedish kronor/U.S. dollar exchange
rate in effect during the month in which the U.S. sales occurred. The
exchange rates used to make currency conversions were the rates
published in the International Financial Statistics for November 1996,
the month in which of the U.S. sales occurred.
Petitioners made a circumstance of sale adjustment for imputed
credit expenses by subtracting home market credit expenses and by
adding U.S. imputed credit expenses to the net home market prices
calculated in the petition. Petitioners calculated home market imputed
credit expenses based on the average payment period reported in the
foreign market research, and the average lending rate in Sweden
published in the International Financial Statistics for the fourth
quarter of 1996. Petitioners calculated U.S. imputed credit expenses
based on payment terms included in the foreign market research, of 60
days and the average lending rate in the United States published in the
International Financial Statistics. Petitioners did not adjust for
differences in packing costs because petitioners assumed that packing
costs were the same for home market and U.S. sales.
Comparison of NV and net U.S. prices for sales of SSWR from Sweden
results in estimated dumping margins that range from 21.17 percent to
22.74 percent.
Taiwan
Petitioners identified three Taiwan exporters and producers of
SSWR: Walsin-CarTech Specialty Steel Corp.; Yieh Hsing; and Yieh United
Steel Corp.
Most of the domestic production of SSWR is sold to unaffiliated
end-users and includes delivery charges to the customer. Petitioners
obtained prices for U.S. sales by Yieh Hsing during November 1996 for
the grades of SSWR that are most commonly exported to the United States
from Taiwan. Petitioners used export prices as the basis for U.S.
prices because the SSWR was sold prior to the date of importation and
to an unaffiliated U.S. distributor. Petitioners provided port of
export prices for Yieh Hsing's U.S. sales. Petitioners subtracted
foreign inland freight from the reported U.S. prices. Petitioners did
not calculate imputed credit expenses for the U.S. sales since letter
of credit payment terms were available for these sales.
Petitioners provided information showing that the volume of the
home market sales is sufficient to form a basis for NV and provided
prices for actual recent sales from the SSWR producers to unaffiliated
customers in Taiwan.
Petitioners calculated net NV by subtracting amounts for delivery
costs and imputed credit expenses from the reported gross home market
price. Petitioners based credit expenses on the average payment period
of 85 days and the average borrowing rate reported in the foreign
market research. Additionally, petitioners adjusted NV for differences
in packing costs between the U.S. and domestic sales. Finally,
petitioners converted home market prices in New Taiwan dollars per
metric ton to U.S. dollars per metric ton by using the New Taiwan
dollar/U.S. dollar exchange rate in effect during the month in which
the U.S. sales occurred. For conversion purposes, petitioners used the
monthly average exchange rates published by the Federal Reserve rather
than the monthly average exchange rates published by the International
Monetary Fund (IMF) because Taiwan is not a member country of the IMF;
thus, there are no IMF-published exchange rates for Taiwan.
In addition, petitioners provided information demonstrating
reasonable grounds to believe or suspect that sales of SSWR in the home
market were made at prices below the fully allocated COP, within the
meaning of section 773(b) of the Act, and requested that the Department
conduct a Taiwan-wide sales below cost investigation.
Pursuant to section 773(b)(3) of the Act, COP consists of the COM,
SG&A, and packing. To calculate COP, the petitioners calculated COM
primarily using foreign market research.
To calculate SG&A and finance expenses petitioners relied on
amounts reported in Yieh Hsing's 1996 financial statements and other
financial data. We recalculated Yieh Hsing's SG&A and finance expenses
to reflect the amounts reported in its 1996 financial statements.
Petitioner based packing costs on data obtained from foreign market
research. Based upon the comparison of the adjusted prices of the
foreign like product in the home market to the calculated COP, we find
reasonable grounds to believe or suspect that sales of the foreign like
product were made below the COP within the meaning of section
773(b)(2)(A)(i) of the Act (see Initiation Checklist, dated August 19,
1997). Accordingly, the Department is initiating a Taiwan-wide cost
investigation.
Pursuant to sections 773(a)(4), 773(b) and 773(e) of the Act,
petitioners also based NV for sales in Taiwan on CV. For this
initiation, we are accepting CV as an appropriate basis for NV.
Petitioners calculated CV using the same COM, SG&A, and interest
expense figures used to compute Taiwan home market costs. Consistent
with section 773(e)(2) of the Act, petitioners also added to CV an
amount for profit. Profit was based upon Yieh Hsing's 1996 consolidated
audited financial statements.
Comparison of NV and net U.S. price of SSWR from Taiwan results in
an estimated dumping margin of 16.74 percent. Comparisons between Yieh
Hsing's U.S. prices and the constructed
[[Page 45229]]
values result in dumping margins that range from 9.61 percent to 10.05
percent.
Fair Value Comparisons
Based on the data provided by petitioners, there is reason to
believe that imports of SSWR from Germany, Italy, Japan, Korea, Spain,
Sweden, and Taiwan are being, or are likely to be, sold at less than
fair value.
Initiation of Antidumping Investigations
We have examined the petition on SSWR and have found that it meets
the requirements of section 732 of the Act, including the requirements
concerning allegations of the material injury or threat of material
injury to the domestic producers of a domestic like product by reason
of the subject imports, allegedly sold at less than fair value.
Therefore, we are initiating antidumping duty investigations to
determine whether imports of SSWR from Germany, Italy, Japan, Korea,
Spain, Sweden, and Taiwan are being, or are likely to be, sold in the
United States at less than fair value. Unless extended, we will make
our preliminary determinations for the antidumping duty investigations
by January 6, 1998.
Distribution of Copies of the Petitions
In accordance with section 732(b)(3)(A) of the Act, a copy of the
public version of each petition has been provided to the
representatives of the governments of Germany, Italy, Japan, Korea,
Spain, Sweden, and Taiwan. We will attempt to provide a copy of the
public version of each petition to each exporter named in the petition
(as appropriate).
International Trade Commission Notification
We have notified the ITC of our initiations, as required by section
732(d) of the Act.
Preliminary Determinations by the ITC
The ITC will determine by September 15, 1997, whether there is a
reasonable indication that imports of SSWR from Germany, Italy, Japan,
Korea, Spain, Sweden, and Taiwan are causing material injury, or
threatening to cause material injury, to a U.S. industry. Any negative
ITC determination will result in the particular investigation being
terminated; otherwise, the investigations will proceed according to
statutory and regulatory time limits.
Dated: August 19, 1997.
Robert S. LaRussa,
Assistant Secretary for Import Administration.
[FR Doc. 97-22690 Filed 8-25-97; 8:45 am]
BILLING CODE 3510-DS-P
