73 FR 250 pgs. 79809-79814 - Certain Hot-Rolled Carbon Steel Flat Products from Thailand: Preliminary Results of Changed Circumstances Review and Intent To Reinstate Sahaviriya Steel Industries Public Company Limited in the Antidumping Duty Order
Type: NOTICEVolume: 73Number: 250Pages: 79809 - 79814
Docket number: [A-549-817]
FR document: [FR Doc. E8-30993 Filed 12-29-08; 8:45 am]
Agency: Commerce Department
Sub Agency: International Trade Administration
Official PDF Version: PDF Version
DEPARTMENT OF COMMERCE
International Trade Administration
[A-549-817]
Certain Hot-Rolled Carbon Steel Flat Products from Thailand: Preliminary Results of Changed Circumstances Review and Intent To Reinstate Sahaviriya Steel Industries Public Company Limited in the Antidumping Duty Order
AGENCY:
Import Administration, International Trade Administration, Department of Commerce.
SUMMARY:
On May 17, 2006, the Department of Commerce ("the Department") revoked in part the antidumping duty order on certain hot-rolled carbon steel flat products ("hot-rolled steel") from Thailand with respect to Sahaviriya Steel Industries Public Company Limited ("SSI") after having determined that SSI sold the merchandise at not less than normal value ("NV") for a period of at least three consecutive years. See Certain Hot-Rolled Carbon Steel Flat Products from Thailand: Final Results of Antidumping Duty Administrative Review, Partial Revocation of Antidumping Duty Order and Partial Rescission of Antidumping Duty Administrative Review , 71 FR 28659 (May 17, 2006) (" Revocation "). As the result of an adequate allegation from a domestic interested party in this proceeding, the Department, pursuant to section 751(b)(1) of the Tariff Act of 1930, as amended ("the Act"), is now conducting a changed circumstances review to determine whether SSI has resumed dumping hot-rolled steel and whether the antidumping order should be reinstated for hot-rolled steel from Thailand manufactured and exported by SSI. See Initiation of Antidumping Duty Changed Circumstances Review: Certain Hot-Rolled Carbon Steel Flat Products from Thailand , 73 FR 18766 (April 7, 2008) (" Initiation Notice "). We preliminarily determine that SSI has sold hot-rolled steel at less than NV and that hot-rolled steel produced and exported by SSI should be reinstated in the antidumping duty order on hot-rolled steel from Thailand. We will instruct U.S. Customs and Border Protection ("CBP") to suspend liquidation of all entries of hot-rolled steel manufactured and exported by SSI and entered, or withdrawn from warehouse, for consumption on or after the date of publication of this notice in the Federal Register .
FOR FURTHER INFORMATION CONTACT:
John Drury or Angelica Mendoza, AD/CVD Operations, Office 7, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue NW, Washington, DC 20230; telephone: (202) 482-0195 or (202) 482-3019, respectively.
SUPPLEMENTARY INFORMATION:
Background
On November 29, 2001, the Department published the antidumping duty order on hot-rolled steel from Thailand. See Antidumping Duty Order: Certain Hot-Rolled Carbon Steel Flat Products From Thailand , 66 FR 59562 (November 29, 2001) (" Hot-Rolled Steel Order "). In November 2004, in the course of the 2003-2004 administrative review, SSI requested revocation of the Hot-Rolled Steel Order with respect to its sales of subject merchandise. See Certain Hot-Rolled Carbon Steel Flat Products From Thailand; Preliminary Results of Antidumping Duty Administrative Review and Intent to Revoke and Rescind in Part , 70 FR 73197 (December 9, 2005).
In its revocation request, SSI agreed to immediate reinstatement in the Hot-Rolled Steel Order , as long as any producer or reseller is subject to the order, should the Department determine that SSI "sold the subject merchandise at less than normal value." See SSI's November 30, 2004, letter to the Department requesting revocation. On May 17, 2006, the Department revoked the antidumping duty order with respect to SSI under 19 C.F.R. 351.222(e)(1) and 351.222(f) after having determined that SSI sold merchandise subject to this review at not less than NV for a period of at least three consecutive years.1 See Revocation .
Footnotes:
1 The three administrative reviews forming the basis of the revocation are: 1) the May 3, 2001, through October 31, 2002, review, Certain Hot-Rolled Carbon Steel Flat Products From Thailand: Final Results and Partial Rescission of Antidumping Duty Administrative Review , 69 FR 19388 (April 13, 2004); 2) the November 1, 2002, through October 31, 2003, review, Certain Hot-Rolled Carbon Steel Flat Products from Thailand: Rescission of Antidumping Duty Administrative Review , 69 FR 18349 (April 7, 2004); and 3) the November 1, 2003, through October 31, 2004, review, Revocation .
On November 8, 2006, United States Steel Corporation ("Petitioner") submitted an allegation arguing that SSI has resumed dumping hot-rolled steel in the United States since revocation from the Hot-Rolled Steel Order , and requested that the Department initiate a changed circumstances review. See Petitioner's November 8, 2006, letter to the Department. Petitioner requested that the Department reinstate the Hot-Rolled Steel Order with respect to SSI's exports to the United States of hot-rolled steel produced by SSI. The Department requested additional information from Petitioner on December 1, 2006, December 22, 2006, February 1, 2007, and December 11, 2007. Petitioner filed responses to the Department's request for additional information on December 5, 2006, January 12, 2007, February 26, 2007, and January 29, 2008, respectively.
In its February 1, 2007, request for additional information, the Department requested that Petitioner update its U.S., home market, and cost data for SSI for the period October 1, 2005 through September 30, 2006. See the Department's February 1, 2007, request for additional information at question 1. In its February 26, 2007, response, Petitioner updated its request by using the time period October 1, 2005, through September 30, 2006, for its margin analysis as requested by the Department. Petitioner also utilized a Kim Eng Live ("Kelive") Market Analysis report dated February 14, 2007, to value slab for use in constructed value ("CV") because it could not find home market or third country prices for hot-rolled steel for the period October 1, 2005, through September 30, 2006, to use as the basis for NV. See Exhibit 2, pages 1-4 of Petitioner's February 26, 2007, submission.
On May 11, 2007, the Department met with Petitioner to discuss its request for a changed circumstances review for SSI. See Memorandum to the File, dated May 14, 2007. On September 27, 2007, Petitioner submitted slab cost data for SSI from two sources independent of the Kelive Market Analysis. On November 20, 2007, the Department released to parties information regarding its inquiries into Petitioner's use of slab cost from the Kelive Market Analysis. See the Department's November 20, 2007, Memorandum to the File and accompanying e-mail attachments.
On December 11, 2007, the Department requested that Petitioner update its changed circumstances review request to use more contemporaneous information for its margin analysis ( i.e. , July 1, 2006, through June 30, 2007). Additionally, the Department requested that Petitioner update its request for the October 1, 2005, through September 30, 2006, period using the two sources of data provided in its September 27, 2007, submission to value steel slab. See the Department's December 11, 2007, request for additional information at question 1. In its January 29, 2008, response, Petitioner updated its review request pursuant to the requests of the Department and based its amended allegation on sales and cost information for the period of review July 1, 2006, through June 30, 2007.
In its January 29, 2008, submission, Petitioner provided price quotes concerning SSI's sales activity in the U.S. and cost information for its NV (CV) calculation, and argued that SSI had sold hot-rolled steel at less than NV during the period July 1, 2006, through June 30, 2007. Petitioner stated that it was unable to obtain SSI's home market or third country prices for either the proposed 2005-2006 or 2006-2007 periods of review ("PORs"). See Petitioner's February 26, 2007, and March 5, 2008, submissions. Therefore, Petitioner based NV for sales made by SSI in the United States on CV and provided a comparison of U.S. price to CV. See Exhibit 2 pages 1-4 of Petitioner's February 26, 2007, submission for the 2005-2006 period and pages 2-5 of Petitioner's March 5, 2008, submission for the 2006-2007 period. Petitioner provided information showing estimated dumping margins range from 0.60 percent to 28.22 percent. See Changed Circumstances Review Initiation Checklist, dated March 21, 2008.
On January 17, 2007, February 22, 2007, and February 5, 2008, SSI submitted letters to the Department requesting that it be granted an administrative protective order ("APO") in order to have access to proprietary information submitted by Petitioner. On February 16, 2007, March 2, 2007, and February 14, 2008, respectively, the Department responded to these requests, explaining, in part, that the Department could not grant APO access pursuant to 19 C.F.R. 351.104(a) to SSI because a changed circumstances review had not been initiated. See the Department's February 16, 2007, March 2, 2007, and February 14, 2008, letters to SSI.
On December 12, 2006, January 4, 2007, January 17, 2007, March 7, 2007, March 28, 2007, April 5, 2007, April 10, 2007, November 28, 2007, February 12, 2008, March 21, 2008, and August 25, 2008, SSI filed letters contesting Petitioner's request for a changed circumstances review. SSI asserted that section 751(b) of the Act, the statutory provision governing changed circumstance reviews, does not cover reinstatement of a revoked company into an antidumping duty order. SSI argued that a changed circumstances review of affirmative dumping or injury determinations is allowed, but that the statute does not mention the reinstatement of a previously revoked company. SSI maintained that once an antidumping duty order is revoked, whether in whole or in part, the underlying injury and dumping determinations no longer apply to the merchandise that has been revoked, and that the Department relinquishes jurisdiction over the merchandise covered.
On December 21, 2006, January 12, 2007, March 23, 2007, April 2, 2007, and April 9, 2007, Petitioner filed rebuttal comments to SSI's comments. Petitioner argued that the Department rejected arguments similar to SSI's contentions regarding the Department's legal authority to reinstate the order in a previous case. See Sebacic Acid from the People's Republic of China: Final Results of Antidumping Duty Changed Circumstances Review and Reinstatement of the Antidumping Duty Order , 70 FR 16218 (March 30, 2005). Petitioner also argued that SSI's contention, that the Department imposed a rigorous evidentiary standard for initiation for a changed circumstances review, is incorrect. Petitioner claimed that the Department should not impose a higher standard for a respondent with a prior history of dumping than it would for a respondent without a prior history of dumping. Petitioner maintained that the standard for initiation of a changed circumstances review should be lower than that for an investigation. However, regardless of the standard, Petitioner claimed that it has demonstrated that SSI has resumed dumping.
On April 7, 2008, the Department initiated a changed circumstances review to determine whether SSI had resumed dumping hot-rolled steel and whether to reinstate SSI in the antidumping order for hot-rolled steel from Thailand. See Initiation Notice . We issued a questionnaire to SSI on April 11, 2008. SSI submitted its responses to sections A, B, C, and D of our questionnaire on May 23, 2008, June 6, 2008, June 9, 2008, and June 16, 2008, respectively. On July 18, 2008, we issued our first supplemental questionnaire to SSI covering sections A, B, and C, and issued a follow-up supplemental questionnaire on August 7, 2008. SSI submitted its response to our July 18, 2008, and August 7, 2008, questionnaires on August 15, 2008. On August 6, 2008, we issued a first supplemental questionnaire to SSI covering section D of the response to which SSI responded on September 5, 2008. On August 25, 2008, SSI submitted a request that the Department reconsider and terminate the changed circumstances review. On September 18, 2008, we issued a third supplemental questionnaire to SSI covering sections A, B, and C. SSI submitted its response to this questionnaire on October 2, 2008. On October 29, 2008, we extended the due date for the final results of this review to April 22, 2009. See Certain Hot-Rolled Carbon Steel Flat Products from Thailand: Extension of Time Limit for Final Results of Changed Circumstances Review , 73 FR 64303 (October 29, 2008) (" Extension Notice "). On November 17, 2008, we issued a second supplemental questionnaire to SSI covering section D of the response. SSI responded to this supplemental questionnaire on December 1, 2008. On December 10, 2008, we published a notice correcting the POR listed in the Extension Notice . See Certain Hot-Rolled Carbon Steel Flat Products from Thailand: Correction of Notice of Extension of Time Limit for Final Results of Changed Circumstances Review , 73 FR 75079 (December 10, 2008). On December 11, 2008, Petitioner submitted comments for consideration in these preliminary results of review. On December 17, SSI submitted comments in response to Petitioner's December 11, 2008, letter. Based on our analysis of SSI's home market and U.S. sales data, we preliminarily determine that SSI sold hot-rolled steel at issue at less than NV during the July 1, 2006, through June 30, 2007, POR.
Verification
As provided in section 782(i)(3) of the Act and 19 C.F.R. 351.307(b)(iv), the Department verified the cost of production ("COP"), CV, home market sales, and U.S. sales questionnaire responses of SSI. We conducted the home market and U.S. sales verification from October 27, 2008, through October 31, 2008. We conducted the COP/CV verification from December 15, 2008, through December 19, 2008. We used standard verification procedures, including examination of relevant sales and financial records. Our verification results are outlined in the home market and U.S. sales verification report for SSI. For a further discussion, see Memorandum to the File through Richard O. Weible and Angelica Mendoza, from John K. Drury, dated December 19, 2008. The verification report for the COP/CV verification will be issued subsequent to these preliminary results of review.
Scope of the Order
For purposes of the order, the products covered are certain hot-rolled carbon steel flat products of a rectangular shape, of a width of 0.5 inch or greater, neither clad, plated, nor coated with metal and whether or not painted, varnished, or coated with plastics or other non-metallic substances, in coils (whether or not in successively superimposed layers), regardless of thickness, and in straight lengths, of a thickness of less than 4.75 mm and of a width measuring at least 10 times the thickness. Universal mill plate ( 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 4.0 mm, not in coils and without patterns in relief) of a thickness not less than 4.0 mm is not included within the scope of the order.
Specifically included within the scope of the order are vacuum degassed, fully stabilized (commonly referred to as interstitial-free ("IF")) steels, high strength low alloy ("HSLA") steels, and the substrate for motor lamination steels. IF steels are recognized as low carbon steels with micro-alloying levels of elements such as titanium or niobium (also commonly referred to as columbium), or both, added to stabilize carbon and nitrogen elements. HSLA steels are recognized as steels with micro-alloying levels of elements such as chromium, copper, niobium, vanadium, and molybdenum. The substrate for motor lamination steels contains micro-alloying levels of elements such as silicon and aluminum.
Steel products to be included in the scope of the order, regardless of definitions in the Harmonized Tariff Schedule of the United States ("HTSUS"), are products in which: i) iron predominates, by weight, over each of the other contained elements; ii) the carbon content is 2 percent or less, by weight; and iii) none of the elements listed below exceeds the quantity, by weight, respectively indicated:
1.80 percent of manganese, or
2.25 percent of silicon, or
1.00 percent of copper, or
0.50 percent of aluminum, or
1.25 percent of chromium, or
0.30 percent of cobalt, or
0.40 percent of lead, or
1.25 percent of nickel, or
0.30 percent of tungsten, or
0.10 percent of molybdenum, or
0.10 percent of niobium, or
0.15 percent of vanadium, or
0.15 percent of zirconium.
All products that meet the physical and chemical description provided above are within the scope of the order unless otherwise excluded.
The following products, by way of example, are outside or specifically excluded from the scope of the order:
-Alloy hot-rolled steel products in which at least one of the chemical elements exceeds those listed above (including, e.g. , American Society for Testing and Materials ("ASTM") specifications A543, A387, A514, A517, A506).
-Society of Automotive Engineers ("SAE")/American Iron Steel Institute ("AISI") grades of series 2300 and higher.
-Ball bearing steels, as defined in the HTSUS.
-Tool steels, as defined in the HTSUS.
-Silico-manganese (as defined in the HTSUS) or silicon electrical steel with a silicon level exceeding 2.25 percent.
-ASTM specifications A710 and A736.
-USS abrasion-resistant steels (USS AR 400, USS AR 500).
-All products (proprietary or otherwise) based on an alloy ASTM specification (sample specifications: ASTM A506, A507).
-Non-rectangular shapes, not in coils, which are the result of having been processed by cutting or stamping and which have assumed the character of articles or products classified outside chapter 72 of the HTSUS.
The merchandise subject to the order is currently classified in the HTSUS at subheadings: 7208.10.15.00, 7208.10.30.00, 7208.10.60.00, 7208.25.30.00, 7208.25.60.00, 7208.26.00.30, 7208.26.00.60, 7208.27.00.30, 7208.27.00.60, 7208.36.00.30, 7208.36.00.60, 7208.37.00.30, 7208.37.00.60, 7208.38.00.15, 7208.38.00.30, 7208.38.00.90, 7208.39.00.15, 7208.39.00.30, 7208.39.00.90, 7208.40.60.30, 7208.40.60.60, 7208.53.00.00, 7208.54.00.00, 7208.90.00.00, 7211.14.00.90, 7211.19.15.00, 7211.19.20.00, 7211.19.30.00, 7211.19.45.00, 7211.19.60.00, 7211.19.75.30, 7211.19.75.60, and 7211.19.75.90.
Certain hot-rolled carbon steel flat products covered by the order, including: vacuum degassed fully stabilized; high strength low alloy; and the substrate for motor lamination steel may also enter under the following tariff numbers: 7225.11.00.00, 7225.19.00.00, 7225.30.30.50, 7225.30.70.00, 7225.40.70.00, 7225.99.00.90, 7226.11.10.00, 7226.11.90.30, 7226.11.90.60, 7226.19.10.00, 7226.19.90.00, 7226.91.50.00, 7226.91.70.00, 7226.91.80.00, and 7226.99.01.80. Subject merchandise may also enter under 7210.70.30.00, 7210.90.90.00, 7211.14.00.30, 7212.40.10.00, 7212.40.50.00, and 7212.50.00.00. Although the HTSUS subheadings are provided for convenience and customs purposes, the written description of the merchandise is dispositive.
Basis for Reinstatement
In requesting revocation, pursuant to 19 C.F.R. 351.222(b)(2)(i)(B), SSI agreed to immediate reinstatement of the order, so long as any exporter or producer is subject to the order, if the Secretary concludes that subsequent to the revocation, SSI sold hot-rolled steel at less than NV. See Revocation . Under 19 C.F.R. 351.222(b)(2)(i)(B) as long as any exporter or producer is subject to an antidumping duty order which remains in force, an entity previously granted a revocation may be reinstated under that order if it is established that the entity has resumed the dumping of subject merchandise.
In this case, because other exporters in Thailand remain subject to the Hot-Rolled Steel Order , the order remains in effect, and SSI may be reinstated in the order. The Department granted SSI revocation based in part upon its agreement to immediate reinstatement in the antidumping duty order if the Department were to find that the company resumed dumping of hot-rolled steel from Thailand. See Revocation .
As described in the "U.S. Price" and "Normal Value" sections, below, we have examined SSI's response and have preliminarily found that SSI's dumping margin for the review period is greater than de minimis . Accordingly, we preliminarily intend to reinstate SSI in the antidumping order.
Fair Value Comparisons
To determine whether sales of hot-rolled steel from Thailand to the United States were made at less than NV, we compared SSI's export price ("EP") sales made in the United States to unaffiliated purchasers, to NV as described in the "U.S. Price" and "Normal Value" sections of this notice, below. In accordance with section 777A(d)(2) of the Act, we compared individual EP sales to monthly weighted-average NVs.
Product Comparisons
In accordance with section 771(16) of the Act we considered all products produced by SSI covered by the description in the "Scope of the Order" section, above, and sold in the home market during the POR, to be foreign like products for purposes of determining appropriate product comparisons to U.S. sales. We first attempted to compare contemporaneous U.S. and comparison-market sales of products that are identical with respect to the following characteristics: 1) whether painted or not; 2) quality; 3) carbon content; 4) yield strength; 5) thickness; 5) width; 6) whether cut-to-length or coil; 7) whether temper rolled or not; 8) whether pickled or not; 9) edge trim; and 10) with or without patterns in relief. Where we were unable to compare sales of the identical merchandise, we compared U.S. sales to comparison-market sales of the most similar merchandise based on the above characteristics. Where there were no sales of foreign like product to compare to a U.S. sale, we compared the price of the U.S. sale to CV.
Level of Trade
In accordance with section 773(a)(1)(B) of the Act, to the extent practicable, we base NV on sales made in the comparison market at the same level of trade ("LOT") as the EP transaction. The NV LOT is defined as the starting-price sales in the home market or, when NV is based on CV, as the sales from which selling, general, and administrative ("SGA") expenses and profit are derived. The EP LOT is defined as the starting price in the United States to the unaffiliated U.S. customer.
We obtained information from SSI regarding the marketing stages involved in making its reported foreign market and U.S. sales to unaffiliated customers. SSI provided a description of all selling activities performed, along with a flowchart and tables comparing the LOTs among each channel of distribution and customer category for both markets. See SSI's May 23, 2008, questionnaire response at exhibit A-7 and its August 15, 2008, supplemental questionnaire response at page S1ABC8-11 (page 11).
For the United States market, SSI stated that it sells through one channel and only to trading companies, and that the trading companies take title to the subject merchandise in Thailand for all shipments. See SSI's May 23, 2008, questionnaire response at A-23 and A-24. We reviewed the level at which SSI performed each of the claimed selling functions with respect to the claimed customer category. For all of the activities listed, the level of performance for both direct shipments and warehouse shipments was substantially identical across all types of classes of customers. Based on our analysis of all of SSI's selling functions for sales to the United States, we find all United States sales were made at the same LOT, i.e. , the EP LOT.
For the home market, SSI identified three channels of distribution described as follows: 1) direct shipments to unaffiliated end-users/resellers; 2) sales through affiliated trading companies; and 3) sales through affiliated resellers/ end users. In addition, SSI identified three classes of customers: 1) Domestic Sales A-1; 2) Domestic Sales A-2; and 3) Domestic Sales B customers. See SSI's May 23, 2008, questionnaire response at pages A-6 and A-7. We reviewed the level at which SSI performed each of the claimed selling functions with respect to each claimed channel of distribution and customer category. For all of the activities listed (which included sales promotion, technical services, inventory management, financing, and arranging freight/delivery), the level of performance for both direct shipments and warehouse shipments was substantially identical across all types of channels and classes of customers. Based on our analysis of all of SSI's home market selling functions, we find all home market sales were made at the same LOT, i.e. , the NV LOT. We also found that SSI provided a similar level of selling functions on all of its EP sales, and that the level of these EP selling functions was comparable to the level of selling functions that SSI performed on its home market sales. Based on the foregoing, we determine that there is one LOT on SSI's EP sales and that the EP LOT is comparable to the HM LOT. Therefore, we preliminarily determine that an LOT adjustment is not warranted.
U.S. Price
Section 772(a) of the Act defines EP as "the price at which the subject merchandise is first sold (or agreed to be sold) before the date of importation by the producer or exporter of subject merchandise outside of the United States to an unaffiliated purchaser for exportation to the United States." For purposes of this changed circumstances review, SSI classified all of its U.S. sales shipped directly from Thailand to the United States as EP sales. For these preliminary results, we have accepted this classification. The merchandise shipped directly to unaffiliated customers in the U.S. market was not sold through an affiliated U.S. importer, and we find no other grounds for treating these transactions as CEP sales. We, therefore, preliminarily determine that these transactions were EP sales.
Export Price
We calculated EP in accordance with section 772(a) of the Act. We based EP on packed prices to customers in the United States. We made adjustments for the following movement expenses: foreign inland freight, and foreign brokerage and handling charges.
We have preliminarily determined to use the date of invoice as the date of sale for all sales to the United States, as evidence on the record indicates that terms of sale may change up to the issuance of the invoice. See Analysis Memorandum, dated concurrently with this notice.
Normal Value
A. Selection of Comparison Market
To determine whether there is a sufficient volume of sales in the home market to serve as a viable basis for calculating NV ( i.e. , the aggregate volume of home market sales of the foreign like product is greater than five percent of the aggregate volume of U.S. sales), we compared SSI's volume of home market sales of the foreign like product to the volume of its U.S. sales of the merchandise subject to this review, in accordance with section 773(a)(1)(B) of the Act. Because SSI's aggregate volume of home market sales of the foreign like product was greater than five percent of its aggregate volume of U.S. sales for subject merchandise, we determined the home market was viable. See , e.g. , SSI's May 23, 2008, questionnaire response at Appendix A-1.
B. Cost of Production Analysis
Because Petitioner's allegation that SSI made sales at less than NV was based in part on the allegation that SSI made sales below the COP during the POR, we had reasonable grounds to believe or suspect that sales of the foreign like product under consideration for the determination of NV in this review may have been made at prices below the COP, as provided by section 773(b)(2)(A)(ii) of the Act. See Changed Circumstances Review Initiation Checklist dated March 28, 2008. Pursuant to section 773(b)(1) of the Act, we initiated a COP investigation of sales by SSI. See Initiation Notice at 18768-18769.
In accordance with section 773(b)(3) of the Act, we calculated COP based on the sum of SSI's cost of materials and fabrication for the foreign like product, plus amounts for general and administrative expenses ("GA"), and interest expenses. We relied on the COP information provided by SSI, with modifications. SSI reported its costs on the basis of the products' cost of goods sold ("COGS") rather than the cost of manufacturing ("COM"). As it is our normal practice to rely on the COM during the POR, we adjusted the reported costs for each CONNUM to reflect the difference between the average per-unit COGS and the average per-unit COM. SSI purchased slab and certain services from affiliates. We analyzed these transactions in accordance with the transactions disregarded rule ( i.e. , section 773(f)(2) of the Act) and adjusted the reported costs to reflect the higher of the transfer price or market price. We revised the calculation of the GA expense ratio by adding back to the numerator of the calculation the amounts SSI reported as offsets for the "reversal allowance for diminution in value of raw materials and finished goods" and the "reversal of allowance for diminution in value of spare parts and consumable goods." In order to keep the calculations of the GA and financial expense ratios on the same basis as the reported COM, we subtracted the portion of scrap that was taken as an offset in the calculation of COM from the denominators of the ratio calculations. See Cost of Production and Constructed Value Calculation Memorandum for the Preliminary Results, dated concurrently with this notice.
To determine whether SSI's home market sales had been made at prices below the COP, we computed weighted-average COPs during the POR, and compared the weighted-average COP figures to home market sales prices of the foreign like product as required under section 773(b) of the Act. On a product-specific basis, we compared the COP to the home market prices net of billing adjustments, any applicable movement charges, selling expenses and packing expenses.
In determining whether to disregard home market sales made at prices below the COP, we examined, in accordance with sections 773(b)(1)(A) and (B) of the Act, whether, within an extended period of time, such sales were made in substantial quantities, and whether such sales were made at prices which permitted the recovery of all costs within a reasonable period of time in the normal course of trade. Where less than 20 percent of the respondent's home market sales of a given model were at prices below the COP, we did not disregard any below-cost sales of that model because we determined that the below-cost sales were not made within an extended period of time and in "substantial quantities." Where 20 percent or more of the respondent's home market sales of a given model were at prices less than the COP, we disregarded the below-cost sales because: (1) they were made within an extended period of time in "substantial quantities," in accordance with sections 773(b)(2)(B) and (C) of the Act; and (2) based on our comparison of prices to the weighted-average COPs for the POR, they were at prices which would not permit the recovery of all costs within a reasonable period of time, in accordance with section 773(b)(2)(D) of the Act.
Our cost test for SSI revealed that, for home market sales of certain models, less than 20 percent of the sales of those models were at prices below the COP. We therefore retained all such sales in our analysis and used them as the basis for determining NV. Our cost test also indicated that for home market sales of other models, more than 20 percent were sold at prices below the COP within an extended period of time and were at prices which would not permit the recovery of all costs within a reasonable period of time. Thus, in accordance with section 773(b)(1) of the Act, we excluded these below-cost sales from our analysis and used the remaining above-cost sales as the basis for determining NV.
C. Constructed Value
In accordance with section 773(e) of the Act, we calculated CV based on the sum of SSI's material and fabrication costs, SGA expenses, profit, and U.S. packing costs. We calculated the COP component of CV as described above in the "Cost of Production Analysis" section of this notice. In accordance with section 773(e)(2)(A) of the Act, we based SGA expenses and profit on the amounts incurred and realized by the respondent in connection with the production and sale of the foreign like product in the ordinary course of trade, for consumption in the foreign country.
D. Price-to-Price Comparisons
We calculated NV based on prices to unaffiliated customers, as well as affiliated customers whose sales passed the arm's-length test, in Thailand. We used SSI's adjustments and deductions as reported. We made deductions, where appropriate, for foreign inland freight pursuant to section 773(a)(6)(B) of the Act. In addition, for comparisons involving similar merchandise, we made adjustments for differences in cost attributable to differences in physical characteristics of the merchandise compared pursuant to section 773(a)(6)(C)(ii) of the Act and 19 CFR 351.411. We also made adjustments for differences in circumstances of sale ("COS") in accordance with section 773(a)(6)(C)(iii) of the Act and 19 CFR 351.410. We made COS adjustments for imputed credit expenses. Finally, we deducted home market packing costs and added U.S. packing costs in accordance with sections 773(a)(6)(A) and (B) of the Act.
We have preliminarily determined to use the date of invoice as the date of sale for all sales in the home market, as evidence on the record indicates that terms of sale may change up to the issuance of the invoice. See Analysis Memorandum, dated concurrently with this notice.
E. Price-to-CV Comparisons
If we were unable to find a home market match of such or similar merchandise, in accordance with section 773(a)(4) of the Act, we based NV on CV. Where appropriate, we made adjustments to CV in accordance with section 773(a)(8) of the Act.
Currency Conversion
We made currency conversions into U.S. dollars based on the exchange rates in effect on the dates of the U.S. sales, as certified by the Federal Reserve Bank, in accordance with section 773A(a) of the Act.
Preliminary Results of Review
As a result of our review, we preliminarily determine the following weighted-average dumping margin exists for the period July 1, 2006, through June 30, 2007:
| Manufacturer/Exporter | Margin (Percent) |
|---|---|
| Sahaviriya Steel Industries Public Company Limited | 9.05 |
The Department will disclose to parties the calculations performed in connection with these preliminary results within ten days of the date of publication of this notice. Interested parties may request a hearing within 30 days of the publication. Any hearing, if requested, will be held 39 days after the publication of this notice or the first workday thereafter. Interested parties may submit case briefs the later of 30 days after the date of publication of this notice or seven days after the issuance of the final verification report, whichever date is later. Rebuttal briefs, limited to issues raised in the case briefs, may be filed not later than seven days after the date on which the case briefs were due.
Reinstatement and Suspension of Liquidation
Since we have preliminarily established that hot-rolled steel from Thailand manufactured and exported by SSI is being sold at less than NV, SSI is hereby preliminarily reinstated in the antidumping duty order. We will instruct CBP to suspend liquidation of all entries of subject merchandise manufactured and exported by SSI entered, or withdrawn from warehouse, for consumption on or after the date of publication of this notice in the Federal Register . Furthermore, a cash-deposit requirement of 6.42 percent will be in effect for all shipments of the subject merchandise manufactured and exported by SSI entered, or withdrawn from warehouse, for consumption on or after the publication date of this notice. This requirement shall remain in effect until further notice.
The Department intends to complete this review by April 22, 2009. See Extension Notice . In accordance with 19 CFR 351.221(c)(3)(i), the final results of the changed circumstance review will set forth the factual and legal conclusions upon which our results are based, a description of any action proposed based on those results, and our analysis of any comments received.
This notice is published in accordance with sections 751(b) and 771(i) of the Act.
Dated: December 19, 2008.
David M. Spooner,
Assistant Secretary for Import Administration.
[FR Doc. E8-30993 Filed 12-29-08; 8:45 am]
BILLING CODE 3510-DS-S