[Federal Register Volume 64, Number 44 (Monday, March 8, 1999)]
[Notices]
[Pages 10979-10982]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-5629]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-201-806]
Carbon Steel Wire Rope From Mexico: Preliminary Results of
Antidumping Duty Administrative Review
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
ACTION: Notice of preliminary results of antidumping duty
administrative review.
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SUMMARY: The Department of Commerce (``the Department'') is conducting
an administrative review of the antidumping duty order on carbon steel
wire rope from Mexico in response to requests by respondent, Aceros
Camesa S.A. de C.V. (``Camesa''), and petitioner, the Committee of
Domestic Steel Wire Rope and Specialty Cable Manufacturers (``the
Committee''). This review covers exports of subject merchandise to the
United States during the period March 1, 1997 through February 28,
1998.
We have preliminarily determined that sales have not been made
below normal value (``NV''). If these preliminary results are adopted
in our final results, we will instruct the U.S. Customs Service to
liquidate appropriate entries without regard to antidumping duties.
Interested parties are invited to comment on these preliminary results.
Parties who submit comments are requested to submit with each comment a
statement of the issue and a brief summary of the comment.
EFFECTIVE DATE: March 8, 1999.
FOR FURTHER INFORMATION CONTACT: Mark Hoadley, (202) 482-4106, Laurel
LaCivita, (202) 482-4236, or Maureen Flannery, (202) 482-3020, AD/CVD
Enforcement, Import Administration, International Trade Administration,
U.S. Department of Commerce, 14th Street and Constitution Avenue, NW,
Washington DC 20230.
Applicable Statute and Regulations
Unless otherwise stated, 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. In addition, unless otherwise stated, all
citations to the Department's regulations are references to the
regulations as codified at 19 CFR Part 351 (April 1998).
SUPPLEMENTARY INFORMATION:
Background
The Department published in the Federal Register the antidumping
duty order on steel wire rope from Mexico on March 25, 1993 (58 FR
16173). On March 11, 1998 we published in the Federal Register (63 FR
11868) a notice of opportunity to request an administrative review of
the antidumping duty order on steel wire rope from Mexico covering the
period March 1, 1997 through February 28, 1998.
In accordance with 19 CFR 351.213(b)(2), Camesa requested that we
conduct an administrative review of Camesa's sales. The Committee also
requested a review of Camesa's sales, in accordance with 19 CFR
351.213(b)(1). We published a notice of initiation of this antidumping
duty administrative review on April 24, 1998 (63 FR 20378).
On May 22, 1998, Camesa requested that it be allowed to limit its
sales reporting to sales involving identical or nearly identical
merchandise. This request was opposed by the Committee in a letter
dated June 19, 1998, but was granted by the Department on June 24,
1998. On June 26, 1998, the Committee submitted a letter objecting to
the Department's decision. On September 25, 1998, the Department issued
an amendment to its decision, expanding Camesa's reporting requirements
while still allowing some limitation to the sales reported. For further
information, see the ``Product Comparisons'' section below.
On September 1, 1998, the Department, in accordance with section
773(b)(2)(A)(ii), initiated an investigation of sales below cost. The
Department determined to initiate this inquiry because, during the
first administrative review of this proceeding, the Department
disregarded some of Camesa's below-cost sales. The final results of the
first administrative review were published on September 2, 1998 (63 FR
46753). We received cost data from Camesa on October 21, 1998.
During this review, the Department did not conduct a verification
of the information provided by Camesa.
Scope of the Review
The product covered by this review is carbon steel wire rope. Steel
wire rope encompasses ropes, cables, and cordage of iron or carbon
steel, other than stranded wire, not fitted with fittings or made up
into articles, and not made up of brass plated wire. Imports of these
products are currently classifiable under the following Harmonized
Tariff Schedule (HTS) subheadings: 7312.10.9030, 7312.10.9060 and
7312.10.9090.
Excluded from this review is stainless steel wire rope, which is
classifiable under the HTS subheading 7312.10.6000, and all forms of
stranded wire, with the following exception.
Based on the affirmative final determination of circumvention of
the antidumping duty order, 60 FR 10831 (Feb. 28, 1995), the Department
has determined that steel wire strand, when manufactured in Mexico by
Camesa and imported into the United States for use in the production of
steel wire rope, falls within the scope of the antidumping duty order
on steel wire rope from Mexico. Such merchandise is currently
classifiable under subheading 7312.10.3020 of the HTS.
Although HTS subheadings are provided for convenience and Customs
purposes, the written description of the scope of this order remains
dispositive.
This review covers one manufacturer and exporter, Camesa, and the
period March 1, 1997 through February 28, 1998.
Product Comparisons
In accordance with section 771(16) of the Act, we considered all
products produced by Camesa covered by the description in the ``Scope
of Review'' section, above, and sold in the home market during the
period of review (POR) to be foreign like products for the purposes of
determining appropriate
[[Page 10980]]
product comparisons with U.S. sales. In the Product Concordance section
(Appendix V) of the questionnaire, we provided the following hierarchy
of product characteristics to be used for reporting identical and most
similar comparisons of merchandise: (1) Type of steel wire (finishing
type); (2) diameter of wire rope; (3) type of core; (4) class of wire
rope; (5) grade of steel; (6) number of wires per strand; (7) design of
strands; and (8) lay of rope.
Camesa requested that we limit its reporting of home market sales
of steel wire rope during the POR because it made contemporaneous sales
of models of rope in its home market that were identical to all of its
models sold in the United States. Thus, it argued, the Department could
conduct its analysis with these identical matches alone, and any other
reported sales would be superfluous. We told Camesa that it could limit
its reporting of home market sales to identical and a range of similar
foreign like products sold during the POR, but that we might, at a
later date, require the reporting of additional home market sales at
short notice.\1\ Petitioners objected, both before and after our
decision, arguing that allowing limited reporting would prevent the
identification of all possible matches of home market sales to U.S.
sales. We later requested that Camesa expand its home market sales and
cost reporting to include information on all models of steel wire rope
belonging to the classes of rope sold in the United States. See
memorandum to the file, dated September 25, 1998.
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\1\ Specifically, we originally asked for sales of all
``merchandise that is: (1) identical to the U.S. product; or (2)
that is identical except that the merchandise is in the millimeter
size just above or just below the size of the U.S. merchandise; and/
or (3) that is identical to the U.S. product with respect to all
product characteristics other than wire lay.'' See letter from
Edward Yang, dated June 24, 1998.
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United States Price
We based United States price on export price (EP), as defined in
section 772(a) of the Act, because the merchandise was sold directly by
the exporter to unaffiliated U.S. purchasers prior to the date of
importation, and because constructed export price was not indicated by
other facts of record.
The Department calculated EP for Camesa based on packed, delivered
prices to customers in the United States. We made deductions, where
applicable, for domestic and foreign inland freight expenses, inland
insurance, U.S. customs duties, and brokerage and handling in
accordance with section 772(c)(2)(A). We added to U.S. price an amount
for duty drawback received by Camesa.
Normal Value
Based on a comparison of the aggregate quantity of home market and
U.S. sales, we determined, pursuant to section 773(a)(1)(B) of the Act,
that the quantity of foreign like product sold in the home market was
sufficient to permit a proper comparison with sales of the subject
merchandise to the United States. Therefore, in accordance with section
773(a)(1)(B)(i) of the Act, we based NV on the price (exclusive of
value-added tax (VAT)) at which the foreign like product was first sold
for consumption in the home market, in the usual commercial quantities,
and in the ordinary course of trade. Camesa made sales of subject
merchandise both to unaffiliated and affiliated home market customers.
None of the sales used for matches were sales to affiliated parties.
Therefore, none of these sales were used in the margin calculation.
Camesa originally submitted its home market sales database on July
7, 1998. In response to our supplemental questionnaire, Camesa
resubmitted the database on October 20, 1998. In our supplemental
questionnaire we asked Camesa to revise its reporting of its database
in two ways: (1) Expand its sales reporting as described above in the
``Product Camparisons'' section of this Notice; and (2) revise its home
market database to include additional details regarding the physical
characteristics of each product. We did not ask Camesa to recalculate
any of the figures reported in the database. The October 20, 1998
submission, however, contained numerous discrepancies with data that
had already been reported in the July 7th submission.
Because sufficient sales of identical merchandise reported in the
original, July 7th submission, were found to be above cost, we did not
need to rely on sales of similar merchandise reported in the October
20th submission in order to calculate a margin. Therefore, it was not
necessary to rely on the expanded sales reporting of the October 20th
database.
Because we did not need the additional sales reported in the
October 20th database and because that database contained changes not
requested by the Department,\2\ we relied solely on the July 7th
database for our calculations. We relied on the product characteristics
reported in Appendix SB-4 of Camesa's October 20th submission to
confirm that the home market products reported in the July 7th
submission were in fact identical to those products sold to the United
States.
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\2\ Section 351.301(b)(2) provides that with respect to
administrative reviews, submission of unsolicited factual
information is due no later than 140 days after the last day of the
anniversary month. Included within respondents submission of October
20 was additional information not requested by the Department.
Because this information was not requested and was untimely we
rejected it.
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Cost of Production Analysis
Section 773(b)(1) requires the Department to conduct a sales-below-
cost investigation if it has reasonable grounds to believe or suspect
sales below cost in the respondent's home market. According to section
773(b)(2)(A)(ii) of the Act, there are reasonable grounds to believe or
suspect that sales in the home market have been made at below cost if
sales were disregarded in a previous administrative review for having
been at prices below cost. Therefore, because some of Camesa's home
market sales were excluded from the margin calculation in the last
review, after having been found to be at prices below cost, Carbon
Steel Wire Rope from Mexico, Final Results of Antidumping Duty
Administrative Review, 63 FR 46753 (Sept. 2, 1998), the Department is
required to conduct a sales-below-cost investigation before determining
a margin in this review. Accordingly, we requested and obtained from
Camesa the cost data necessary to determine whether below-cost home
market sales occurred during the current POR. Before making any NV
comparisons for Camesa, we conducted the cost of production (COP)
analysis described below.
In accordance with section 773(b)(3) of the Act, we calculated a
weighted-average COP for each model sold in the home market based on
the sum of Camesa's cost of materials and fabrication for the foreign
like product (i.e., cost of manufacturing (COM)), plus amounts for home
market general and administrative expenses (GNA), interest expenses,
and indirect selling expenses. We relied on the COP data submitted by
Camesa in its cost questionnaire response.
Camesa submitted cost data for each model reported for each month
of the review period. For each model, we calculated a single weighted-
average figure by weighting monthly COMs by the amount produced in each
month.
We compared the weighted-average COPs for Camesa to home market
sales of the foreign like product, as required under section 773(b) of
the Act, in order to determine whether these sales had been made at
prices below cost. On a product-specific basis, we compared COPs to
home market prices, less discounts, movement expenses, direct selling
expenses, and packing costs.
[[Page 10981]]
In determining whether to disregard home market sales made at
prices below cost, we examined whether such sales were made: (1) Within
an extended period of time in substantial quantities; and (2) at prices
which permitted the recovery of all costs within a reasonable period of
time in the normal course of trade, in accordance with sections
773(b)(1)(A) and (B) of the Act. In accordance with section
773(b)(2)(C), where 20 percent or more of home market sales during the
POR of a particular model were made at prices below cost we disregard
the below-cost sales for the model because the sales were made in
substantial quantities within an extended period and at prices that
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.
When making price comparisons with U.S. sales, in accordance with
section 771(16) of the Act, the Department considers all products sold
in the home market within the ``Scope of Review'' and in the ordinary
course of trade. If sales of identical merchandise in the home market
are disregarded because they are sold below cost, or because they are
otherwise not made in the ordinary course of trade, we compare U.S.
sales to home market sales of the most similar foreign like products
made in the ordinary course of trade. Product similarity is based on
the characteristics listed in Sections B and C of our antidumping
questionnaires. See also the section entitled ``Product Comparisons''
in this Notice.
Level of Trade
In accordance with section 773(a)(1)(B) of the Act, to the extent
practicable, we determine NV based on sales in the comparison market at
the same level of trade (LOT) as the U.S. transaction. The NV LOT is
that of the starting-price sales in the comparison market or, when NV
is based on constructed value, that of the sales from which we derive
selling, general and administrative expenses and profit. For EP, the
U.S. LOT is also the level of the starting-price sale, which is usually
from exporter to importer. For CEP, it is the level of the constructed
sale from the exporter to the importer.
To determine whether NV sales are at a different LOT than EP or
CEP, we examine stages in the marketing process and selling functions
along the chain of distribution between the producer and the
unaffiliated customer. If the comparison-market sales are at a
different LOT, and the difference affects price comparability, as
manifested in a pattern of consistent price differences between the
sales on which NV is based and comparison-market sales at the LOT of
the export transaction, we make a LOT adjustment under section
773(a)(7)(A) of the Act. Finally, for CEP sales, if the NV level is
more remote from the factory than the CEP level and there is no basis
for determining whether the difference in the NV and CEP levels affects
price comparability, we adjust NV under section 773(a)(7)(B) of the Act
(the CEP offset provision). See Notice of Final Determination of Sales
at Less Than Fair Value: Certain Cut-to-Length Carbon Steel Plate From
South Africa, 62 FR 61731, 61732 (November 19, 1997).
Camesa did not claim a LOT adjustment; however, we requested
information concerning Camesa's distribution system, including classes
of customers, selling functions, and selling expenses, to determine
whether such an adjustment was necessary. Camesa reported that all
sales to the United States during the POR were to distributors, and
sales in the comparison market, the home market in this case, were to
industrial end users and distributors. After reviewing Camesa's
response to our questions involving its sales functions in both
channels of distribution in its home market and the United States, we
preliminarily determine that sales in the home market and sales in the
United States are at the same LOT, and that no adjustment is warranted.
See Memorandum to the File (``Analysis Memo''), dated March 2, 1999.
Price-to-Price Comparisons
Pursuant to section 777A(d)(2), we compared the EPs of individual
transactions to the monthly weighted-average prices (NV) of sales of
the foreign like product made in the ordinary course of business. We
based NVs on packed, delivered prices to unaffiliated purchasers in the
home market. We made adjustments, where applicable, in accordance with
section 773(a)(6) of the Act. Where applicable, we made adjustments to
home market prices for discounts and inland movement expenses. We also
made circumstance-of-sale adjustments for differences in credit and
warranty expenses, pursuant to section 773(a)(6)(C)(iii) of the Act, by
adding to NVs the amounts of U.S. credit and warranty expenses for each
U.S. sale and subtracting the home market credit and warranty expenses.
Similarly, in order to adjust for differences in packing expenses
between the two markets, we increased home market price by U.S. packing
costs and reduced it by home market packing costs. Prices were reported
net of VAT and, therefore, no deduction for VAT was necessary.
Sales of Strand to a U.S. Affiliate
Pursuant to the affirmative final determination of circumvention of
this antidumping duty order (see Steel Wire Rope from Mexico:
Affirmative Final Determination Circumvention of Antidumping Duty
Order, 60 FR 10831 (Feb. 28, 1995)), steel wire strand, when
manufactured in Mexico by Camesa and imported into the United States
for use in the production of steel wire rope, falls within the scope of
the antidumping duty order on steel wire rope from Mexico.
In its October 20, 1998 supplemental questionnaire response, Camesa
reported that during the POR all of its exports of steel wire strand to
the United States were made to its U.S. subsidiary, Camesa, Inc. These
strands consisted of three product types: prestressed concrete strand,
post-tension tendon, and oilfield strands (DYCAM and swab lines).
Camesa reports that these strands are not used by Camesa Inc. in the
manufacture of steel wire rope and that they fall outside the scope of
the circumvention order; thus we have preliminarily determined that
they do not fall within the types of steel wire rope strand covered by
the 1995 circumvention determination.
Preliminary Results of the Review
As a result of our comparison of EPs and NVs, we preliminarily
determine that the following weighted-average dumping margin exists:
------------------------------------------------------------------------
Weighted-
average
Exporter/manufacturer margin
percentage
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Aceros Camesa S.A. de C.V.................................. 0.00
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Parties to the proceeding may request disclosure within 5 business
days of the date of publication of this notice. Any interested party
may request a hearing within 30 days of publication. Pursuant to 19 CFR
351.310(d), any hearing, if requested, will be held 37 days after the
publication of this notice, or the first workday thereafter. Interested
parties may submit case briefs within 30 days of the date of
publication of this notice. Rebuttal briefs, which must be limited to
issues raised in the case briefs, may be filed not later than 35 days
after the date of publication. The Department will publish a notice of
final results of this administrative review, which will include the
results of its analysis of issues raised in any such comments, not
later than 120 days after the date of publication of this notice.
[[Page 10982]]
Upon issuance of the final results of review, the Department shall
determine, and the Customs Service shall assess, antidumping duties on
all appropriate entries. If these preliminary results are adopted in
our final results, we will instruct the U.S. Customs Service not to
assess antidumping duties on the merchandise subject to review. Upon
completion of this review, the Department will issue appraisement
instructions directly to the Customs Service.
Furthermore, the following deposit rates will be effective upon
publication of the final results of this administrative review for all
shipments of steel wire rope products from Mexico entered, or withdrawn
from warehouse, for consumption on or after the publication date, as
provided for by section 751(a)(2)(c) of the Act: (1) the cash deposit
rate for the reviewed company will be the rate established in the final
results of this review; (2) for merchandise exported by manufacturers
or exporters not covered in this review but covered in the original
investigation of sales at less than fair value (LTFV) or a previous
review, the cash deposit will continue to be the company-specific rate
published for the most recent period; (3) if the exporter is not a firm
covered in this or a previous review, or the original LTFV
investigation, but the manufacturer is, the cash deposit rate will be
the rate established for the most recent period for the manufacturer of
the merchandise; and (4) for all other producers and/or exporters of
this merchandise, the cash deposit rate shall be 111.68 percent, the
``all others'' rate established in the LTFV investigation (58 FR 7531,
February 8, 1993).
These deposit rates, when imposed, shall remain in effect until
publication of the final results of the next administrative review.
This notice also serves as a preliminary reminder to importers of
their responsibility under 19 CFR 351.402(f) to file a certificate
regarding the reimbursement of antidumping duties prior to liquidation
of the relevant entries during this review period. Failure to comply
with this requirement could result in the Secretary's presumption that
reimbursement of antidumping duties occurred and the subsequent
assessment of double antidumping duties.
This administrative review and notice are issued and published in
accordance with sections 751(a)(1) of the Act (19 U.S.C. 1675(a)) and
19 CFR 351.213.
Dated: February 26, 1999.
Robert S. LaRussa,
Assistant Secretary for Import Administration.
[FR Doc. 99-5629 Filed 3-5-99; 8:45 am]
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