[Federal Register Volume 63, Number 43 (Thursday, March 5, 1998)]
[Notices]
[Pages 10847-10849]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-5602]


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DEPARTMENT OF COMMERCE

International Trade Administration
[A-428-824]


Notice of Preliminary Determination of Sales at Less Than Fair 
Value: Stainless Steel Wire Rod From Germany

AGENCY: Import Administration, International Trade Administration, 
Department of Commerce.

EFFECTIVE DATE: March 5, 1998.

FOR FURTHER INFORMATION CONTACT: Sunkyu Kim or Everett Kelly, Import 
Administration, International Trade Administration, U.S. Department of 
Commerce, 14th Street and Constitution Avenue, NW, Washington, DC 
20230; telephone: (202) 482-2613 or (202) 482-4194, respectively.

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 Round Agreements Act (``URAA''). In addition, 
unless otherwise indicated, all citations to the Department's 
regulations are to the regulations at 19 CFR part 351 (62 FR 27296, May 
19, 1997).

Preliminary Determination

    We preliminarily determine that stainless steel wire rod (``SSWR'') 
from Germany is being, or is likely to be, sold in the United States at 
less than fair value (``LTFV''), as provided in section 733 of the Act. 
The estimated margins are shown in the ``Suspension of Liquidation'' 
section of this notice.

Case History

    Since the initiation of this investigation on August 19, 1997 (see 
Notice of Initiation of Antidumping Duty Investigations: Stainless 
Steel Wire Rod from Germany, Italy, Japan, Korea, Spain, Sweden and 
Taiwan (62 FR 45224, August 26, 1997) (``Notice of Initiation'')), the 
following events have occurred:
    On September 15, 1997, the United States International Trade 
Commission (``ITC'') notified the Department of its affirmative 
preliminary injury determination in this case (see ITC Investigation 
No. 731-TA-770).
    In September 1997, the Department obtained information from the 
U.S. Embassy in Germany identifying Krupp Edelstahlprofile and BGH 
Edelstahl Freital GmbH as the potential producers and/or exporters of 
the subject merchandise to the United States. Based on this 
information, on September 19, 1997, the Department issued the 
antidumping duty questionnaire to the following producers/exporters of 
SSWR to the United States: Krupp Edelstahlprofile GmbH and Krupp Hoesch 
Steel Products (collectively ``Krupp'') and BGH Edelstahl Freital GmbH 
(``BGH Edelstahl'').
    On October 23, 1997, BGH Edelstahl informed the Department, via 
facsimile message, that it would not respond to the Department's 
antidumping questionnaire.
    On October 24, 1997, Krupp submitted its response to Section A of 
the questionnaire. Subsequently, on October 27, 1997, Krupp informed 
the Department that it would not respond to Sections B, C, and D of the 
Department's antidumping questionnaire.
    On December 11, 1997, petitioners made a timely request that the 
Department postpone the preliminary determination in this investigation 
and the companion investigations of SSWR from Italy, Japan, Korea, 
Spain, Sweden, and Taiwan to February 25, 1998. We did so on December 
16, 1997, in accordance with section 733(c)(1) of the Act (see Notice 
of Postponement of Preliminary Antidumping Duty Determinations: Steel 
Wire Rod from Germany, Italy, Japan, Korea, Spain, Sweden, and Taiwan, 
62 FR 66849, 66850 (December 22, 1997)).

Scope of Investigation

    For purposes of this investigation, 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, 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 in diameter. 
Two stainless steel grades, SF20T and K-M35FL, are excluded from the 
scope of the investigation. The chemical makeup for the excluded grades 
is as follows:

[[Page 10848]]



----------------------------------------------------------------------------------------------------------------
                                                                                                                
----------------------------------------------------------------------------------------------------------------
                                                      SF20T                                                     
----------------------------------------------------------------------------------------------------------------
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.............                                                       
----------------------------------------------------------------------------------------------------------------
                                                     K-M35FL                                                    
----------------------------------------------------------------------------------------------------------------
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.                    
Phosphorous.......................  0.04 max.............  Aluminum.............  0.20/0.35.                    
Sulfur............................  0.03 max                                                                    
----------------------------------------------------------------------------------------------------------------

    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, our written description of the scope 
is dispositive.

Period of Investigation

    The period of investigation (``POI'') is July 1, 1996, through June 
30, 1997.

Fair Value Comparisons

    To determine whether sales of SSWR by Krupp and BGH Edelstahl to 
the United States were made at less than fair value, we compare the 
export price or constructed export price to the normal value. Because 
Krupp responded to our questionnaire only in part (i.e., Section A) and 
BGH Edelstahl did not respond to the questionnaire at all, we were 
unable to calculate LTFV margins for this preliminary determination 
using information submitted by the respective companies. Therefore, in 
accordance with section 776 of the Act, our results are based on facts 
otherwise available.

Facts Available

    Section 776(a)(2) of the Act provides that, if an interested party 
(1) Withholds information that has been requested by the Department, 
(2) fails to provide such information in a timely manner or in the form 
or manner requested, (3) significantly impedes a determination under 
the antidumping statute, or (4) provides such information but the 
information cannot be verified, the Department shall use facts 
otherwise available in reaching the applicable determination (subject 
to subsections 782(d) and (e)). As discussed above, both Krupp and BGH 
Edelstahl failed to respond to the Department's questionnaires. 
Accordingly, we have determined that use of facts available is 
appropriate for both respondents. With respect to Krupp, we note that 
we cannot perform an antidumping analysis with the Section A response 
that Krupp did provide. This limited information is so incomplete that 
it cannot, for purposes of section 782(e)(3), ``serve as a reliable 
basis for reaching the applicable determination.''
    Section 776(b) of the Act further provides that adverse inferences 
may be used for a party that has failed to cooperate by not acting to 
the best of its ability to comply with requests for information (see 
also the Statement of Administrative Action (``SAA''), accompanying the 
URAA, H.R. Rep. No. 316, 103rd Cong., 2d Sess. 870). Given their 
statements of refusal to comply with the Department's requests for 
information, Krupp and BGH Edelstahl have clearly failed to cooperate 
to the best of their ability in this investigation. Therefore, the 
Department has determined that an adverse inference is warranted with 
respect to both companies.
    Consistent with our practice in cases where respondents' refusal to 
participate precludes us from conducting our LTFV analysis, as facts 
otherwise available, we are basing Krupp's and BGH Edelstahl's margins 
on information in the petition. Section 776(c) provides that, when the 
Department relies on secondary information (e.g., the petition) as the 
facts otherwise available, it must, to the extent practicable, 
corroborate that information from independent sources that are 
reasonably at its disposal. We reviewed the adequacy and accuracy of 
the information in the petition during our pre-initiation analysis of 
the petition, to the extent appropriate information was available for 
this purpose (e.g., import statistics, foreign market research reports, 
and data from U.S. producers). See Notice of Initiation and August 19, 
1997, ``Import Administration AD Investigation Initiation Checklist 
(``Initiation Checklist'').
    For purposes of the preliminary determination, we were only able to 
corroborate part of the information in the petition. We reexamined the 
export price data provided in the petition in light of information 
obtained during the investigation and, to the extent that it could be 
corroborated, found that it continues to be of probative value. 
However, the Department was provided no useful information by the 
respondents or other interested parties, and is aware of no other 
independent sources of information, that would enable it to further 
corroborate the remaining components of the margin calculation in the 
petition (as adjusted by the Department). See the February 11, 1998, 
Memorandum to the File. We note that the SAA at 870 specifically states 
that, where ``corroboration may not be practicable in a given 
circumstance,'' the Department may nevertheless apply an adverse 
inference.

A. Krupp and BGH Edelstahl

    Consistent with Department practice, as facts otherwise available, 
the Department is assigning to Krupp and BGH Edelstahl the highest 
margin alleged in the petition for any German producer (as adjusted by 
the Department), which is 21.28 percent (see Initiation Checklist and 
the Notice of Initiation for a discussion of the margin calculations in 
the petition and the Department's recalculations).

B. The All-Others Rate

    All foreign manufacturers/exporters in this investigation are being 
assigned dumping margins on the basis of facts otherwise available. 
Section 735(c)(5) of the Act provides that, where the dumping margins 
established for all exporters and producers individually investigated 
are determined entirely under section 776, the Department may use any 
reasonable method to establish the estimated all-others rate for 
exporters and producers not individually investigated, including 
averaging the estimated weighted-

[[Page 10849]]

average dumping margins determined for the exporters and producers 
individually investigated. This provision contemplates that we weight 
average the facts-available margins to establish the all-others rate. 
Where the data is not available to weight average the facts-available 
rates, the SAA, at 873, provides that we may use other reasonable 
methods.
    Inasmuch as we do not have the data necessary to weight average the 
respondents' facts available margins, we are basing the all-others rate 
on a simple average of the margins in the petition (as adjusted by the 
Department). As a result the all-others rate is 19.45 percent.

Suspension of Liquidation

    In accordance with section 733(d) of the Act, we are directing the 
Customs Service to suspend liquidation of all imports of subject 
merchandise that are entered, or withdrawn from warehouse, for 
consumption on or after the date of publication of this notice in the 
Federal Register. We will instruct the Customs Service to require a 
cash deposit or the posting of a bond equal to the amount by which the 
NV exceeds the export price, as indicated in the chart below. These 
suspension-of-liquidation instructions will remain in effect until 
further notice. The dumping margins are as follows:

------------------------------------------------------------------------
                                                               Margin   
                   Exporter/manufacturer                     percentage 
------------------------------------------------------------------------
Krupp Edelstahl profile GmbH, Krupp Hoesch Steel Products.         21.28
BGH Edelstahl Freital GmbH................................         21.28
All-Others................................................         19.45
------------------------------------------------------------------------

The all-others rate, which we derived from the average of the margins 
calculated in the petition, applies to all entries of subject 
merchandise other than those exported by the named respondents.

ITC Notification

    In accordance with section 733(f) of the Act, we have notified the 
ITC of our determination. If our final determination is affirmative, 
the ITC will determine before the later of 120 days after the date of 
this preliminary determination or 45 days after our final determination 
whether these imports are materially injuring, or threaten material 
injury to, the U.S. industry.

Public Comment

    Case briefs or other written comments in at least ten copies must 
be submitted to the Assistant Secretary for Import Administration no 
later than April 9, 1998, and rebuttal briefs, no later than April 16, 
1998. A list of authorities used and an executive summary of issues 
should accompany any briefs submitted to the Department. Such summary 
should be limited to five pages total, including footnotes. In 
accordance with section 774 of the Act, we will hold a public hearing, 
if requested, to afford interested parties an opportunity to comment on 
arguments raised in case or rebuttal briefs. Tentatively, the hearing 
will be held on April 20, 1998, time and room to be determined, at the 
U.S. Department of Commerce, 14th Street and Constitution Avenue, NW, 
Washington, DC 20230. Parties should confirm by telephone the time, 
date, and place of the hearing 48 hours before the scheduled time.
    Interested parties who wish to request a hearing, or to participate 
if one is requested, must submit a written request to the Assistant 
Secretary for Import Administration, U.S. Department of Commerce, Room 
1870, within thirty days of the publication of this notice. Requests 
should contain: (1) The party's name, address, and telephone number; 
(2) the number of participants; and (3) a list of the issues to be 
discussed. Oral presentations will be limited to issues raised in the 
briefs. If this investigation proceeds normally, we will make our final 
determination not later than May 11, 1998.
    This determination is published pursuant to section 777(i) of the 
Act.

    Dated: February 25, 1998.
Robert S. LaRussa,
Assistant Secretary for Import Administration.
[FR Doc. 98-5602 Filed 3-4-98; 8:45 am]
BILLING CODE 3510-DS-P