[Federal Register Volume 59, Number 144 (Thursday, July 28, 1994)]
[Unknown Section]
[Page ]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-18314]


[Federal Register: July 28, 1994]


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DEPARTMENT OF COMMERCE
[A-570-836]


Initiation of Antidumping Duty Investigation: Glycine From the 
People's Republic of China

AGENCY: Import Administration, International Trade Administration, 
Commerce.

EFFECTIVE DATE: July 28, 1994.

FOR FURTHER INFORMATION CONTACT: Julie Anne Osgood or David Boyland, 
Office of Countervailing Investigations, Import Administration, 
International Trade Administration, U.S. Department of Commerce, 14th 
Street and Constitution Avenue, N.W., Washington, D.C., 20230 at (202) 
482-0167 and (202) 482-0588, respectively.

INITIATION OF INVESTIGATION:

The Petition

    On July 1, 1994, we received a petition in proper form filed by 
Hampshire Chemical Corporation (``Hampshire'') and Chattem Inc., 
Chemicals Division (``Chattem'') (hereinafter ``petitioners''). 
Petitioners filed a supplement to the petition on July 21, 1994.
    In accordance with 19 CFR 353.12, petitioners allege that imports 
of glycine, or aminoacetic acid, from the People's Republic of China 
(``PRC'') are being, or are likely to be, sold in the United States at 
less than fair value within the meaning of section 731 of the Tariff 
Act of 1930, as amended (``the Act''), and that such imports are 
materially injuring, or threatening material injury to, a U.S. 
industry.
    Petitioners state that they have standing to file the petition 
because Hampshire and Chattem are interested parties, as defined under 
section 771(9)(C) of the Act, and are the only two U.S. producers of 
glycine known to petitioners. If any interested party, as described 
under paragraphs (C), (D), (E), or (F) of section 771(9) of the Act, 
wishes to register support for, or opposition to, this petition, it 
should file a written notification with the Assistant Secretary for 
Import Administration.

Scope of Investigation

    The product covered by this investigation is glycine which is a 
free-flowing crystalline material, like salt or sugar. Glycine is 
produced at varying levels of purity and is used as a sweetener/taste 
enhancer, a buffering agent, reabsorbable amino acid, chemical 
intermediate, and a metal complexing agent. Glycine is currently 
classified under subheading 2922.49.4020 of the Harmonized Tariff 
Schedule of the United States (``HTSUS''). The scope of this 
investigation includes glycine of all purity levels. Although the HTSUS 
subheading is provided for convenience and Customs purposes, our 
written description of the scope of this proceeding is dispositive.

United States Price and Foreign Market Value

    Petitioners based United States Price (``USP'') on four price 
quotes with various terms of sale and Bureau of Census import 
statistics for glycine from the PRC. For purposes of this initiation, 
we have relied on the 1994 price quotes (two of the four price quotes 
provided) and on the Bureau of Census import statistics since they are 
contemporaneous with the calculated foreign market value and more 
proximate with the period of investigation. Petitioners deducted 
foreign inland freight, ocean freight and marine insurance, and U.S. 
inland freight from the price quotes to arrive at an ex-factory unit 
value for imports. In using the import statistics, petitioners deducted 
foreign inland freight from the value to arrive at an ex-factory unit 
value.
    Petitioners contend that the foreign market value (``FMV'') of 
glycine subject to this investigation must be determined in accordance 
with section 773(c) of the Act, which concerns nonmarket economy 
(``NME'') countries. The Department has determined the PRC to be an 
NME, within the meaning of section 771(18)(A) of the Act, in previous 
cases (see e.g., Final Determination of Sales at Less Than Fair Value: 
Sebacic Acid from the PRC, May 31, 1994 (59 FR 28053)). In accordance 
with 771(18)(C) of the Act, that determination continues to apply for 
purposes of this initiation.
    In the course of this investigation, parties will have the 
opportunity to address this NME determination and provide relevant 
information and argument on this issue. Consistent with section 
773(c)(1)(B) of the Act (see Amendment to Final Determination of Sales 
at Less Than Fair Value and Amendment to Antidumping Duty Order: 
Chrome-Plated Lug Nuts from the People's Republic of China, 57 FR 15052 
(April 24, 1992)), parties will have the opportunity in this 
investigation to submit comments on whether FMV should be based on 
prices or costs.
    In accordance with section 773(c) of the Act, FMV in NME cases is 
based on NME producers' factors of production valued in a market 
economy country. In this case, to determine FMV, petitioners relied on 
the factors of production used by Chattem since Chattem's production 
process is believed to be similar to the PRC producers' manufacturing 
process.
    In valuing the factors of production, petitioners used India and 
Pakistan as surrogate countries. For purposes of this initiation, we 
have accepted India and Pakistan as surrogates because their economies 
are at a level of development comparable to the PRC's. (See Memorandum 
to David L. Binder, Director-Division II, Office of Antidumping 
Investigations from David P. Mueller, Director, Office of Policy, dated 
August 1993, regarding non-market economy status and surrogate country 
selection, on file in Room B-099 of the Department of Commerce.) Also, 
there is evidence on the record that India is a producer of comparable 
merchandise, as required by section 773(c)(4) of the Act. When cost 
information was not available in either of these countries, petitioners 
valued the factor using Chattem's own costs.
    In accordance with section 773(c)(1)(B) of the Act, petitioners' 
FMV consisted of the sum of values assigned to materials, labor, 
energy, overhead, and packing. Petitioners adjusted certain factor 
values for inflation and currency exchange rates. Pursuant to section 
773(e)(1) of the Act, petitioners added to the labor and material 
costs, and general expenses, the statutory minimum of eight percent for 
profit.

Fair Value Comparisons

    Based on the data provided by petitioners, there is reason to 
believe that glycine from the PRC is being, or is likely to be, sold at 
less than fair value. The comparison of USP and FMV in the petition 
indicates margins ranging from 86.43 percent to 155.89 percent. If it 
becomes necessary at a later date to consider the petition as a source 
of best information available (``BIA''), we may review these 
calculation bases.

Initiation of Investigation

    We have examined the petition on glycine and have found that it 
meets the requirements of section 732(b) of the Act. Therefore, we are 
initiating an antidumping duty investigation to determine whether 
imports of glycine from the PRC are being, or are likely to be, sold in 
the United States at less than fair value.

International Trade Commission (``ITC'') Notification

    Section 732(d) of the Act requires us to notify the ITC of these 
actions, and we have done so.

Preliminary Determination by the ITC

    The ITC will determine by August 15, 1994, whether there is a 
reasonable indication that imports of glycine from the PRC are causing 
material injury, or threaten to cause material injury, to a U.S. 
industry. A negative ITC determination will result in the investigation 
being terminated; otherwise, this investigation will proceed according 
to statutory and regulatory time limits.
    This notice is published pursuant to section 732(c)(2) of the Act 
and 19 CFR 353.13(b).

    Dated: July 21, 1994.
Susan G. Esserman,
Assistant Secretary for Import Administration.
[FR Doc. 94-18314 Filed 7-27-94; 8:45 am]
BILLING CODE 3510-DS-P