[Federal Register Volume 63, Number 235 (Tuesday, December 8, 1998)]
[Notices]
[Pages 67665-67668]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-32545]


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DEPARTMENT OF COMMERCE

International Trade Administration
[A-588-041]


Final Results of Expedited Sunset Review on Synthetic Methionine 
from Japan

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

ACTION: Notice of final results of expedited sunset review: synthetic 
methionine from Japan.

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SUMMARY: On August 3, 1998, the Department of Commerce (``the 
Department'') initiated a sunset review of the antidumping finding on 
synthetic methionine from Japan (63 FR 41227) pursuant to section 
751(c) of the Tariff Act of 1930, as amended (``the Act''). On the 
basis of a notice of intent to participate and a complete substantive

[[Page 67666]]

response filed on behalf of the domestic industry, and inadequate 
response (in this case no response) from respondent interested parties, 
the Department determined to conduct an expedited review. As a result 
of this review, the Department finds that revocation of the antidumping 
finding would be likely to lead to continuation or recurrence of 
dumping at the levels indicated in the Appendix to this notice.

FOR FURTHER INFORMATION CONTACT: Martha V. Douthit or Melissa G. 
Skinner, Office of Policy for Import Administration, International 
Trade Administration, U.S. Department of Commerce, 14th St. & 
Constitution Ave., NW, Washington, D.C. 20230: telephone (202) 482-3207 
or (202) 482-1560, respectively.

EFFECTIVE DATE: December 8, 1998.

Statute and Regulations

    This review was conducted pursuant to sections 751(c) and 752 of 
the Act. The Department's procedures for the conduct of the sunset 
reviews are set forth in Procedures for Conducting Five-year 
(``Sunset'') Reviews of Antidumping and Countervailing Duty Order, 63 
FR 13516 (March 20, 1998) (``Sunset Regulations''). Guidance on 
methodological or analytical issues relevant to the Department's 
conduct of sunset reviews is set forth in the Department's Policy 
Bulletin 98:3--Policies Regarding the Conduct of Five-year (``Sunset'') 
Reviews of Antidumping and Countervailing Duty Orders; Policy Bulletin, 
63 FR 18871 (April 16, 1998) (``Sunset Policy Bulletin'').

Scope

    The merchandise subject to this antidumping finding is synthetic 
methionine other than synthetic L methionine. Synthetic methionine is 
an amino acid produced in two grades, DL methionine national formula 
grade (used for research and pharmaceutical purposes) and L methionine 
feed grade (used as a food additive). Both grades of synthetic 
methionine are currently classifiable under item 425.0420 of the Tariff 
Schedules of the United States Annotated and Harmonized Tariff Schedule 
item number 2930.40.00.

Background

    On August 3, 1998, the Department initiated a sunset review of the 
antidumping finding on synthetic methionine from Japan (63 FR 41227) 
pursuant to section 751(c) of the Act. The Department received a Notice 
of Intent to Participate from Degussa Corporation (``Degussa''), NOVUS 
International Inc., (``NOVUS''), and Rhone-Poulenc Animal Nutrition 
(``RPAN'') (collectively, ``petitioners'') within the deadline 
specified in section 351.218(d)(1)(i) of the Sunset Regulations. Each 
company claimed interested-party status under section 771(9)(C) of the 
Act as a U.S. manufacturer of synthetic methionine. We received a 
complete substantive response on September 2, 1998 from the 
petitioners. We did not receive a response from any respondent 
interested party. As a result, pursuant to section 751(c)(3)(B) of the 
Act and section 351.218(e)(1)(ii)(C)(2)) of the Sunset Regulations, we 
determined to conduct an expedited review.

Determination

    In accordance with section 751(c)(1) of the Act, the Department 
conducted this review to determine whether revocation of the 
antidumping finding would be likely to lead to continuation or 
recurrence of dumping. Section 752(c) of the Act provides that, in 
making this determination, the Department shall consider the weighted-
average dumping margins determined in the investigation and subsequent 
reviews and the volume of imports of the subject merchandise for the 
period before and the period after the issuance of the antidumping 
finding, and it shall provide to the International Trade Commission 
(``the Commission'') the magnitude of the margin of dumping likely to 
prevail if the finding is revoked.
    The Department's determinations concerning continuation or 
recurrence of dumping and magnitude of the margin are discussed below. 
In addition, parties' comments with respect to the continuation or 
recurrence of dumping and the magnitude of the margin are addressed 
within the respective sections below.

Continuation or Recurrence of Dumping

    Drawing on the guidance provided in the legislative history 
accompanying the Uruguay Round Agreements Act (``URAA''), specifically 
the Statement of Administrative Action (``the SAA''), H.R. Doc. No. 
103-316, vol. 1 (1994), the House Report, H.R. Rep. No. 103-826, pt. 1 
(1994), and the Senate Report, S. Rep. No. 103-412 (1994), the 
Department issued its Sunset Policy Bulletin providing guidance on 
methodological and analytical issues, including the bases for 
likelihood determinations. In its Sunset Policy Bulletin, the 
Department indicated that determinations of likelihood will be made on 
an order-wide basis (see section II.A.3). In addition, the Department 
indicated that normally it will determine that revocation of an 
antidumping order is likely to lead to continuation or recurrence of 
dumping where (a) dumping continued at any level above de minimis after 
the issuance of the order, (b) imports of the subject merchandise 
ceased after the issuance of the order, or (c) dumping was eliminated 
after the issuance of the order and import volumes for the subject 
merchandise declined significantly (see section II.A.3).
    The antidumping finding on synthetic methionine from Japan was 
published in the Federal Register as Treasury Decision 73-188 (38 FR 
18382, July 10, 1973). In the 1980's, the Department conducted several 
administrative reviews.1 The finding remains in effect for 
all imports of synthetic methionine from Japan.
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    \1\ See Synthetic Methionine From Japan; Final Results of 
Administrative Review and Clarification of Antidumping Finding; 47 
FR 15622 (April 12, 1982); Antidumping; Synthetic Methionine from 
Japan; Final Results of Administrative Review of Antidumping 
Finding; 48 FR 20465 (May 6, 1983); Final Results of Antidumping 
Administrative Review; Synthetic Methionine from Japan; 52 FR 38953 
(October 20, 1987); and Synthetic Methionine From Japan; Final 
Results of Antidumping Duty Administrative Review; 53 FR 15261 
(April 28, 1988).
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    The petitioners argue that revocation of the finding would result 
in the continuation or recurrence of dumping on the basis that (1) the 
imposition of the finding resulted in the departure of imports of 
Japanese synthetic methionine from the U.S. market, (2) Japanese 
producers would re-enter the U.S. market at dumped prices, and (3) 
Japanese producers could not sell in the U.S. market without dumping.
    With respect to the cessation of imports of Japanese synthetic 
methionine, the petitioners provided statistics for imports of 
synthetic methionine (both DL- and L-methionine) for the period 1968 
through 1997.2 The petitioners stated that L-methionine is 
considerably more expensive than DL methionine and, based on the 
substantial decline in volume (from 2890 metric tons in 1978 to 86 
metric tons in 1997) and the substantial increase in unit values (from 
$2.53/kg. in 1978 to $25.78/kg. in 1997), virtually all imports of 
synthetic methionine from Japan since 1978 consist of L-methionine. 
Therefore, the petitioners conclude that imports of DL-

[[Page 67667]]

methionine have declined or ceased following the imposition of the 
finding.
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    \2\ See Petitioners' September 2, 1998, Substantive Response to 
Notice of Initiation, Table 1, page 8. Complied from prepared 
testimony of Dale MacDonald before United States Tariff Commission 
for 1968-1972 and from Bureau of Census Data for TSUSA 425.0420 and 
HTS 2930.40.00 for 1985-1997.
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    In support of its assertion that Japanese producers would re-enter 
the U.S. market at dumped prices, the petitioners argue that, as 
demonstrated by the original finding, Japanese producers have a history 
of dumping excess production capacity in the U.S. market. Further, the 
petitioners contend that the circumstances that face the Japanese 
methionine industry today are remarkably similar to those existing at 
the time of the original investigation, particularly with respect to 
Japanese excess capacity and the need to export the vast majority of 
production. Based on statistics from the United Nations Statistical 
Division, Commodity Trade Statistics, the petitioners note that for the 
1995 through 1997 period, Japan exported a significant volume of 
synthetic methionine, particularly to Asian countries. Petitioners add 
that, presumably in response to increased demand in recent years, 
particularly in Asia, the Japanese industry has completed a substantial 
addition to its production capacity. Petitioners argue, therefore, that 
the Asian financial crisis and recent additions to capacity have left 
Japanese producers again with substantial excess capacity and the need 
to find new markets.
    Finally, in support of its assertion that the Japanese producers 
could not sell in the U.S. market without dumping if the antidumping 
finding were revoked, the petitioners state that the U.S. market for 
synthetic methionine is characterized by intense competition. The 
petitioners add that, as the largest consumers of methionine, the 
United States also has the largest customers and, consequently, prices 
in the United States are lower than in the rest of the world. Using 
proprietary information related to Japanese home market prices and U.S. 
sales prices during the 1995 to 1997, the petitioners claim that 
Japanese producers would have to dump their merchandise in order to 
make a sale in the U.S. market.
    For the reasons stated above, the petitioners strongly support a 
determination that dumping of Japanese synthetic methionine is likely 
to continue or recur if the finding were revoked.
    In the first administrative review conducted by the Department 
covering imports prior to June 30, 1980, the Department found that 11 
of the 19 Japanese manufacturers and exporters either had no shipments 
or no longer existed.3 In subsequent administrative reviews, 
the Department found no shipments from all but two non-responsive 
companies.4 We find, therefore, that the cessation of 
imports and the existence of dumping margins after the issuance of the 
finding is highly probative of the likelihood of continuation or 
recurrence of dumping of synthetic methionine from Japan. Deposit rates 
above de minimis continue in effect for several manufacturers, 
exporters, and/or third country resellers (for example, Nippon Kayaku, 
Nippon Soda/Mitsui, Nippon Soda/Mitsui/Central Soya 
(Canada)).5 As discussed in section II.A.3 of the Sunset 
Policy Bulletin, the SAA at 890, and the House Report at 63-64, if 
imports cease after the order is issued, we may reasonably assume that 
exporters could not sell in the United States without dumping and that, 
to reenter the U.S. market, they would have to resume dumping. 
Therefore, given that shipments of the subject merchandise ceased soon 
after the issuance of the finding and that dumping margins continue 
after the issuance of the finding, and absent argument and evidence to 
the contrary, the Department, consistent with section II.A.3 of the 
Sunset Policy Bulletin, determines that dumping is likely to continue 
or recur if the finding were revoked.
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    \3\ See Synthetic Methionine From Japan; Final Results of 
Administrative Review and Clarification of Antidumping Finding; 47 
FR 15622 (April 12, 1982).
    \4\ See Antidumping; Synthetic Methionine from Japan; Final 
Results of Administrative Review of Antidumping Finding; 48 FR 20465 
(May 6, 1983); Final Results of Antidumping Administrative Review; 
Synthetic Methionine from Japan; 52 FR 38953 (October 20, 1987); and 
Synthetic Methionine From Japan; Final Results of Antidumping Duty 
Administrative Review; 53 FR 15261 (April 28, 1988).
    \5\ See Final Results of Antidumping Administrative Review; 
Synthetic Methionine from Japan; 52 FR 38953 (October 20, 1987); and 
Synthetic Methionine From Japan; Final Results of Antidumping Duty 
Administrative Review; 53 FR 15261 (April 28, 1988).
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Magnitude of Dumping

    In the Sunset Policy Bulletin, the Department stated that, in a 
sunset review of an antidumping finding for which no company-specific 
margin or ``all others'' rate is included in the Treasury finding 
published in the Federal Register, the Department normally will provide 
to the Commission the company-specific margin from the first final 
results of administrative review published in the Federal Register by 
the Department. Additionally, if the first final results do not contain 
a margin for a particular company, the Department normally will provide 
the Commission, as the margin for that company, the first ``new 
shipper'' rate established by the Department for that finding. (See 
section II.B.1 of the Sunset Policy Bulletin.) Exceptions to this 
policy include the use of a more recently calculated margin, where 
appropriate, and consideration of duty absorption determinations. (See 
sections II.B.2 and 3 of the Sunset Policy Bulletin).
    Because Treasury did not publish weighted-average dumping margins 
in its finding, the margins determined in the original investigation 
are not available to the Department for use in this sunset review. 
Under these circumstances, the Department normally will select the 
margin from the first administrative review conducted by the Department 
as the magnitude of the margin of dumping likely to prevail if the 
finding is revoked.
    In its substantive response, the petitioners propose three 
alternatives as the magnitude of the margin likely to prevail if the 
finding is revoked: (1) The original dumping margin, (2) the margin 
found in the most recent administrative review, or (3) a new margin 
established by using information on Japanese and U.S. prices. In 
support of their request that the Department select the original 
dumping margin of 48 percent, the petitioners state that although this 
rate was not included in the finding issued by the Treasury, this rate 
can be documented as the original fair value rate from several sources, 
including the Department's first final results of administrative review 
in which the Department used this rate as the ``best information 
available.''6 The petitioners suggest that should the 
Department decline to select the original dumping margin of 48 percent, 
the Department should select the dumping margin of 79 percent found in 
the most recent administrative review that involved actual 
shipments.7 Finally, the petitioners suggest that the 
Department could utilize current pricing information for the Japanese 
and U.S. market provided in its substantive response to determine a new 
margin.
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    \6\ See Synthetic Methionine From Japan; Final Results of 
Administrative Review and Clarification of Antidumping Finding; 47 
FR 15622 (April 12, 1982).
    \7\ See Final Results of Antidumping Duty Administrative Review; 
Synthetic Methionine from Japan; 52 FR 38953 (October 20, 1987).
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    In this case, although the petitioners submitted information 
identifying the margin determined by Treasury to be 48 percent (or 50 
percent depending upon source),8 and the Department, in its 
first administrative review identified the 48 percent ``best 
information available'' rate for non-responsive firms as being

[[Page 67668]]

the ``fair value rate,' 9 this rate was not published by 
Treasury in its July 10, 1973 finding.
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    \8\ See Petitioners' September 2, 1998, Substantive Response to 
Notice of Initiation, pp. 21-24.
    \9\ See Synthetic Methionine From Japan; Final Results of 
Administrative Review and Clarification of Antidumping Finding; 47 
FR 15622 (April 12, 1982).
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    With respect to petitioners' comment that the Department should use 
the margin established in the most recent review covering actual 
shipments for certain producers, petitioners have not provided an 
adequate basis for deviating from the Department's stated policy as set 
out above. Petitioners assert that this margin relates to a more recent 
period--July 1, 1985 through June 30, 1986--and is higher than the 
margins calculated in the first review conducted by the Department. In 
the Sunset Policy Bulletin the Department stated that ``a company may 
choose to increase dumping in order to maintain or increase market 
share'' and that ``the Department may, in response to argument from an 
interested party, provide to the Commission a more recently calculated 
margin for a particular company, where, for that particular company, 
dumping margins increased after the issuance of the order.'' (See 
section II.B.2 of the Sunset Policy Bulletin.) The policy does not 
envision a general exception for any case in which a higher margin was 
found at some point during the life of the order. The Department's 
intent was to establish a policy of using the original investigation 
margin as the starting point, thus providing interested parties the 
opportunity and incentive to come forward with data which would support 
a different estimate. The petitioners, however, merely assert that 
``this is a large margin and is therefore indicative of how Japanese 
merchandise is likely to be priced in the absence of an order.'' (See 
Petitioners' September 2, 1998, Substantive Response, p. 25.) The 
petitioners did not, however, present arguments with respect to changes 
in margin levels as related to market share. The statistics provided by 
the petitioners, 1968-1997 annual volume, value, and unit value of 
imports of synthetic methionine (both DL and L), do not show an 
increase in imports concurrent with an increase in dumping, nor does it 
present the Department with a picture of the relative market shares 
held by Japanese manufacturers and exporters. Given the information 
available to the Department, it is not possible to discern whether any 
increases or decreases in margins reflect an effort to maintain or 
increase market share.
    Similarly, petitioners request that the Department use existing 
information on Japanese and U.S. prices to calculate a margin does not 
provide an adequate basis for altering our approach. As noted in the 
Sunset Regulations and Sunset Policy Bulletin, only under the most 
extraordinary circumstances will the Department rely on a dumping 
margin other than those it calculated and published in its prior 
determination and, further, that it will consider other factors, such 
as prices and costs, in AD sunset reviews only where it determines that 
good cause to consider such other factors exists. 10 
Petitioners did not make any ``good cause'' arguments. Further, 
petitioners have not offered any rationale suggesting that such a 
calculation would not be more speculative and, therefore, less 
probative than a calculated rate from an administrative review. 
Therefore, we are not persuaded that it is appropriate to deviate from 
the policy.
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    \10\ See Section 351.218(e)(2) of the Sunset Regulations and 
Section II.C of the Sunset Policy Bulletin.
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    In conclusion, we are not persuaded that we should deviate from our 
the policy, as stated in the Sunset Policy Bulletin, of using the first 
rates calculated by the Department where published Treasury rates are 
not available. Rather, consistent with the Sunset Policy Bulletin, we 
determine that the original margins calculated by the Department are 
probative of the behavior of the Japanese manufacturers and exporters 
of synthetic methionine. The Department will report to the Commission 
the company-specific and ``all others'' rate contained in the Appendix 
to this notice.

Final Results of Review

    As a result of this review, the Department finds that revocation of 
the antidumping finding would be likely to lead to continuation or 
recurrence of dumping at the margins listed in the Appendix to this 
notice.
    This notice serves as the only reminder to parties subject to 
administrative protective order (APO) of their responsibility 
concerning the disposition of proprietary information disclosed under 
APO in accordance with Section 351.305 of the Department's regulations. 
Timely notification of return/destruction of APO materials or 
conversion to judicial protective order is hereby requested. Failure to 
comply with the regulations and the terms of an APO is a sanctionable 
violation.
    This five-year ``sunset'' review and notice are in accordance with 
sections 751(c), 752, and 777(i)(1) of the Act.

    Dated: December 1, 1998.
Robert S. LaRussa,
Assistant Secretary for Import Administration.

                                APPENDIX
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                                                                 Margin
                   Manufacturers/exporters                     (percent)
------------------------------------------------------------------------
Ajinimoto Co.................................................       5.54
Apls Pharmaceutical Co.......................................      22.54
Amano Pharmaceutical Co., Ltd................................      48.00
Chugai Boyeki Co.............................................          0
Daida Bussan Co..............................................          0
Helm Japan Ltd...............................................      11.14
Inuiu Yakuhin Kogyo..........................................          0
Isho Corportation............................................          0
Iwaka & Co...................................................       1.69
Koyo Merchantile Co., Ltd....................................          0
Kyowa Hakko Kogyo Co.........................................      30.68
Marubeni Corp................................................      48.00
Nippon Kayaku................................................          0
Nippon Soda Co., Ltd./Mitsui & Co............................       8.83
Nisso Raiho Kogyo & Co., Ltd.................................          0
K Sakai & Co.................................................          0
Sakai Chemical...............................................      13.43
Sumitomo Chemical Industrial Co..............................          0
Tetra Chemicals Co...........................................       8.40
All others...................................................      48.00
 
               Third-Country Reseller (country)
 
Atlantic Trading Co. (Canada)................................          0
H.J. Baker & Brothers (West Germany).........................          0
Chemical & Feeds Ltd. (England)..............................      48.00
Chemo Dondorff (West Germany)................................      48.00
Deutsch-Norwegische GmbH (West Germany)......................      22.53
Fortamex Chemicals (Canada)..................................      21.66
Karl O. Helm (West Germany)..................................       1.31
Hoffman LaRoche (Canada).....................................          0
Instel Corp. (France)........................................       6.25
MAC Organization (Italy).....................................          0
Mitsui & Co. (Belgium).......................................          0
Mitsui & Co. ( United Kingdom)...............................          0
Nutrikem Limited (United Kingdom)............................          0
Seimsgluss & Shon (West Germany).............................      48.00
R.W. Unwin & Co ( United Kingdom)............................          0
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[FR Doc. 98-32545 Filed 12-7-98; 8:45 am]
BILLING CODE 3510-DS-P