[Federal Register Volume 64, Number 79 (Monday, April 26, 1999)]
[Notices]
[Pages 20253-20257]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-10287]


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DEPARTMENT OF COMMERCE

International Trade Administration
[A-122-085]


Preliminary Results of Full Sunset Review: Sugar and Syrups From 
Canada

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

ACTION: Notice of preliminary results of full sunset review: Sugar and 
Syrups from Canada.

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SUMMARY: On October 1, 1998, the Department of Commerce (``the 
Department'') initiated a sunset review of the antidumping duty order 
on sugar and syrups from Canada (63 FR 52683) 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 filed on behalf of the 
domestic industry and adequate substantive comments filed on behalf of 
the domestic industry and a respondent interested party, the Department 
is conducting a full review. As a result of this review, the Department 
preliminarily finds that revocation of the antidumping duty order is 
not likely to lead to continuation or recurrence of dumping.

For Further Information Contact: Scott E. Smith or Melissa G. Skinner, 
Office of Policy for Import Administration, International Trade 
Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW, Washington, DC 20230; telephone: (202) 482-
6397 or (202) 482-1560, respectively.
Effective Date: April 26, 1999.

Statute and Regulations

    This review is being conducted pursuant to sections 751(c) and 752 
of the Act. The Department's procedures for the conduct of sunset 
reviews are set forth in Procedures for Conducting Five-year 
(``Sunset'') Reviews of Antidumping and Countervailing Duty Orders, 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 duty order is sugar and 
syrups from Canada produced from sugar cane and sugar beets. The sugar 
is refined into granulated or powdered sugar, icing, or liquid sugar. 
\1\ The subject merchandise is currently classified under Harmonized 
Tariff Schedule of the United States (``HTSUS'') item numbers 
1701.99.0500, 1701.99.1000, 1701.99.5000, 1702.90.1000, and 
1702.90.2000. Although the subheadings are provided for convenience and 
customs purposes, the written description remains dispositive.
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    \1\ This order excludes icing sugar decorations as determined in 
the U.S. Customs Classification of January 31, 1983 (CLA-2 
CO:R:CV:G).
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    On March 24, 1987, the Department revoked the order, in part, with 
respect to Redpath Sugar Ltd. (``Redpath'') (52 FR 9322, March 24, 
1987). On January 7, 1988, the Department revoked the order, in part, 
with respect to Lantic Sugar, Ltd. (``Lantic'') (53 FR 434, January 7, 
1988). In 1996, the Department determined that Rogers Sugar, Ltd. 
(``Rogers'') was the successor in interest to British Columbia Sugar 
Refining Company, Ltd. (``BC Sugar''). \2\ In its substantive response, 
the United States Beet Sugar Association (``the USBSA'') stated that 
there are three companies in Canada that constitute the Canadian 
domestic industry: Lantic, Redpath, and Rogers. Further, all three 
companies, or their predecessors, were involved in the original 
investigation. Because the order was revoked for Lantic and Redpath, 
only Rogers is currently subject to the order.
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    \2\ See Sugar and Syrups from Canada; Final Results of Changed 
Circumstances Antidumping Duty Administrative Review, 61 FR 51275 
(October 1, 1996).
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Background

    On October 1, 1998, the Department initiated a sunset review of the 
antidumping duty order on sugar and syrups from Canada (63 FR 52683), 
pursuant to section 751(c) of the Act. On October 16, 1998, the 
Department received a Notice of Intent to Participate on behalf of a 
domestic interested party, the USBSA, within the applicable deadline 
(October 16, 1998) specified in section 351.218(d)(1)(i) of the Sunset 
Regulations. The USBSA claimed interested party status under section 
771(9)(E) of the Act as a trade association whose members produce sugar 
in the United States and indicated that, although not the original 
petitioners, it had participated in several administrative reviews. We 
received complete substantive responses

[[Page 20254]]

to the notice of initiation on November 2, 1998, on behalf of the USBSA 
and Rogers. In its substantive response, Rogers claimed interested 
party status under section 771(9)(A) of the Act.
    Based on the information submitted by Rogers concerning the volume 
of its exports and the volume of imports as reported in the U.S. Census 
Bureau IM146 Reports, Rogers accounted for significantly more than 50 
percent of the value of total exports of the subject merchandise over 
the five calendar years preceding the initiation of the sunset review. 
Therefore, respondent interested parties provided an adequate response 
to the notice of initiation and the Department is conducting a full 
sunset review in accordance with section 351.218(e)(2)(i) of the Sunset 
Regulations.
    The Department determined that the sunset review of the antidumping 
duty order on sugar and syrups from Canada is extraordinarily 
complicated. In accordance with section 751(c)(5)(C)(v) of the Act, the 
Department may treat a review as extraordinarily complicated if it is a 
review of a transition order (i.e., an order in effect on January 1, 
1995). (See section 751(c)(6)(C) of the Act.) Therefore, on January 15, 
1999, the Department extended the time limit for completion of the 
preliminary results of this review until not later than April 19, 1999, 
in accordance with section 751(c)(5)(B) of the Act.\3\
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    \3\ See Sugar and Syrups from Canada: Extension of Time Limit 
for Preliminary Results of Five-Year Review, 64 FR 3683 (January 25, 
1999).
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Determination

    In accordance with section 751(c)(1) of the Act, the Department is 
conducting this review to determine whether revocation of the 
antidumping duty order 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 duty 
order, and it shall provide to the International Trade Commission 
(``the Commission'') the magnitude of the margin of dumping likely to 
prevail if the order is revoked.
    The Department's determinations concerning continuation or 
recurrence of dumping and the magnitude of the margin are discussed 
below. In addition, parties' comments with respect to continuation or 
recurrence of dumping and the magnitude of the margin are addressed 
within the respective sections below.

Continuation or Recurrence of Dumping

Parties' Comments

    In its substantive response, the USBSA argued that revocation of 
the antidumping duty order would likely result in the recurrence of 
dumping of refined sugar and syrups from Canada (see Substantive 
Response of the USBSA, November 2, 1998). The USBSA noted that refined 
sugar from Canada, and of Canadian origin, is subject to a tariff rate 
quota (``TRQ'') allocation. The USBSA stated that the TRQ allows 10,300 
metric tons (``MT'') of refined sugar to enter the United States duty-
free.4 The USBSA stated that sugar from Canada entering the 
United States above the 10,300 MT level, also known as the tier 2 
level, is currently subject to the tier 2 tariff rate.5
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    \4\ Rogers, in its rebuttal comments, stated that the TRQ 
allocation of sugar from Canada for 1998 was actually 10,300 MT of 
raw sugar which, when converted, is 9,579 metric tons of refined 
sugar. Through telephone conversations with U.S. Department of 
Agriculture officials, the Department has confirmed that the TRQ 
allocation of sugar from Canada for 1998 was 10,300 MT of refined 
sugar.
    \5\ The tier 2 tariff rate is US$0.1716/lb (1998). The 
Department notes that a global TRQ, with a limit of 7,090 MT of 
refined sugar, also exists with tier 1 level duty exemptions. 
Because this global quota is filled on a first come, first served 
basis, Canada could, theoretically, export up to 17,390 MT of 
refined sugar to the United States under the current TRQ system at 
the tier 1 level.
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    Additionally, the USBSA stated that only Rogers, which succeeded BC 
Sugar and consequently is subject to BC Sugar's zero percent ad valorem 
cash deposit rate, is currently subject to the order. The USBSA noted 
that Rogers is the owner of Canada's sole sugar beet processing 
facility; a facility that is being modernized and expanded.
    The USBSA did not address whether dumping continued at any level 
above de minimis after the issuance of the order. Rather, the USBSA 
argued that imports of the subject merchandise fell dramatically 
immediately following the issuance of the order in 1980. The USBSA, 
citing U.S. Department of Agriculture publications, states that import 
volumes of the subject merchandise from Canada in 1979 were 89,521 
short tons and, in 1980, the year of the imposition of the order, sugar 
and syrups imports from Canada fell to 639 short tons. Therefore, the 
USBSA argues that, based on the cessation of imports in the period 
immediately following the imposition of the order, the Department 
should find that revocation of the order would be likely to lead to the 
recurrence of dumping.
    The USBSA stated that, in the past, the existence of the tier 2 
tariff, in conjunction with the TRQ, has limited imports of sugar into 
the United States. However, the USBSA contended the decimation of the 
world sugar price over the past several years has eroded the tier 2 
tariff's position as an impediment to imports. The USBSA concludes 
that, based on the trend in world market prices, by the year 2000 (the 
earliest possible effective date of revocation of the order pursuant to 
this sunset review) exporters of Canadian sugar will be able to ship 
refined sugar to the United States at less-than-fair value prices 
despite the TRQ.
    Additionally, the USBSA stated that the legislative underpinning 
for current U.S. sugar policy is due to expire at the end of 2002. 
Therefore, it asserted, the TRQ will not be as significant an obstacle 
to future imports as it has in the past and the need to preserve the 
order is greater than it was a few years ago. Finally, the USBSA argued 
that the existence of the TRQ and the tier 2 tariff does not provide a 
rationale for revoking the order. The USBSA stated that, despite the 
intervention of the TRQ and the development of U.S. sugar policy, the 
U.S. sugar producing industry continued to support the order and 
regularly expressed to the Department opposition to any proposed 
revocation.
    In its comments addressing the magnitude of dumping likely to 
prevail if the order were revoked, the USBSA estimated dumping margins 
based on current U.S. and Canadian prices. The USBSA calculated 
estimated dumping margins of 30.82 percent for sugar entering the 
United States within the TRQ limits 6 and 409 percent for 
sugar entering the United States subject to the tier 2 
tariff.7
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    \6\ The Department notes that a global TRQ, with a limit of 
7,090 MT refined sugar, also exists with tier 1 level duty 
exemptions established on a first come, first served basis.
    \7\ The tier 2 tariff rate is US$0.1716/lb (1998). The USBSA 
also estimated a dumping margin, based on constructed value 
calculations, for sugar entering the United States from Canada at 
the tier 1 tariff level and at the tier 2 tariff level. Those 
margins are 9.3 percent and 325 percent, respectively.
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    In its substantive response, Rogers argued that revocation of the 
order would precipitate no change in its current U.S. pricing. Rogers 
based this statement on the following facts: Rogers' current dumping 
margin is zero percent and, therefore, the dumping margin does not 
affect selling price; Rogers' exports to the United States are limited 
by quotas; Rogers supplies virtually all Canadian exports to the United 
States under both the global and Canada-specific quotas; and Rogers 
would not

[[Page 20255]]

export to the United States below the Canadian domestic price given the 
current and historical spread between the supply-managed U.S. raw sugar 
price and the Canadian market price, which tracks world market prices.
    With respect to import volumes, Rogers submitted information on the 
volume and value of its exports to the United States for fiscal years 
1994-1998. In addition, Rogers submitted an approximation of the volume 
of direct exports to the United States during fiscal year 1979, the 
year preceding the imposition of the antidumping duty order. This 
volume was based on exports from BC Sugar. This information showed that 
the volume of imports in each fiscal year since 1994, exceeded the 
volume of imports during fiscal year 1979.
    Additionally, Rogers argued that, as a result of the combined 
effect of the programs the United States has in place on the 
importation of raw and refined sugar, the U.S. price-supported sugar 
program, and customs rulings which resulted in cane sugar refined in 
Canada being excluded from the U.S. market, there is virtually no 
chance that revocation of the antidumping duty order would result in 
the resumption of dumping.
    In its rebuttal comments, the USBSA stated that Rogers confirmed 
that it is the only beet sugar processing facility in Canada. Further, 
the USBSA argued that, given the downward trend in the world price of 
sugar and the coming economic feasibility of entering refined sugar 
into the United States notwithstanding the existence of the TRQ and the 
tier 2 tariff, the capacity being added at Rogers' beet sugar facility 
in Alberta must be viewed as a likely source of supply for the U.S. 
market.
    In its rebuttal comments, Rogers stated that the USBSA's 
allegations concerning increases in sugar beet production capacity in 
Canada are factually incorrect. Rogers stated that current capacity in 
Canada is less than it has been historically and submitted production 
statistics for each facility. Rogers argued that increases in 
production capacity made in the recent past are meant to offset 
decreases in production capacity associated with the closure of its 
Winnipeg, Manitoba facility.
    With respect to the volume of exports to the United States, Rogers 
notes that the TRQ is on the value of raw sugar and, as such, the 
volume of actual refined sugar allowed to enter the United States is 
9,579 MTs, not 10,300 MTs. Rogers argued that its exports to the United 
States can hardly be considered a large volume when compared to the 
U.S. consumption of 10,225,000 short tons.
    In its rebuttal comments, Rogers argued that the USBSA's reference 
to the world refined sugar price is irrelevant to this proceeding 
because Rogers only exports to the United States. Rather, it contended, 
the only prices relevant to this proceeding are the Canadian home 
market price and U.S. price of beet sugar. Further, Rogers argued that 
the USBSA's discussion of world refined pricing overtaking the TRQ is 
speculative. Rogers argued that lower world prices for raw sugar will 
lead to lower Canadian refined prices as compared to the high U.S. 
supported price and, thus, the chance of dumping would be less, not 
more.

Department's Determination

    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 duty 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). In instances 
where none of the above criteria are met, the Department will normally 
determine that revocation of the order will not be likely to lead to 
continuation or recurrence of dumping.
    The antidumping duty order on sugar and syrups from Canada was 
published in the Federal Register on April 9, 1980 (45 FR 24126). Since 
that time, the Department has conducted several administrative reviews 
of this order.8 As noted above, the order has been revoked 
with respect to two of the three existing Canadian producers of sugar. 
Therefore, only Rogers is currently subject to the order.
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    \8\ See Sugar and Syrups from Canada; Final Results of 
Antidumping Duty Administrative Review, 46 FR 27985 (May 22, 1981); 
Sugar and Syrups from Canada; Final Results of Antidumping Duty 
Administrative Review, 47 FR 25393 (June 11, 1982); Sugar and Syrups 
from Canada; Final Results of Antidumping Duty Administrative 
Review, 48 FR 49327 (October 25, 1983); Sugar and Syrups from 
Canada; Final Results of Antidumping Duty Administrative Review, 51 
FR 20322 (June 4, 1986); Sugar and Syrups from Canada; Final Results 
of Antidumping Duty Administrative Review and Revocation in Part, 52 
FR 9322 (March 24, 1987); Sugar and Syrups from Canada; Final 
Results of Antidumping Duty Administrative Review, 52 FR 21340 (June 
5, 1987); and Sugar and Syrups from Canada; Final Results of 
Antidumping Duty Administrative Review and Revocation in Part, 53 FR 
434 (January 7, 1988).
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    Consistent with section 752(c) of the Act, the Department 
considered whether dumping continued at any level above de minimis 
after the issuance of the order. In the administrative review covering 
the period April 1, 1981 through March 31, 1982, BC Sugar (the 
predecessor to Rogers) was found to have a zero margin (see Sugars and 
Syrups From Canada; Final Results of Administrative Review of 
Antidumping Duty Order, 48 FR 49327 (October 25, 1983)) and its cash 
deposit rate for future entries was set at zero. Exports by BC Sugar, 
and its successor Rogers, have been subject to a zero deposit rate 
since that time. Therefore, we preliminarily determine that dumping did 
not continue at any level above de minimis after the issuance of the 
order.
    In addition, consistent with section 752(c) of the Act, the 
Department also considered whether imports ceased after the issuance of 
the order. Citing a reduction in imports from about 90,000 short tons 
in 1979 to a little over 600 short tons in 1980, when the order was 
issued, the USBSA argued that imports ceased after the issuance of the 
order. The USBSA also noted that exports of sugar from Canada have been 
limited by quotas that have been in effect since 1982. Although there 
was a decrease in the volume of imports during 1980, imports of subject 
merchandise from Canada increased thereafter and have continued after 
the issuance of the order. Therefore, we preliminarily determine that 
imports did not cease after the issuance of the order.9
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    \9\ Rogers submitted information on its exports to the United 
States since 1990 in its November 3, 1998 submission. The Department 
conducted administrative reviews of shipments between 1979 and 1987. 
Additionally, import statistics from the U.S. Census Bureau IM146 
Reports, U.S. Department of Commerce statistics, U.S. Department of 
Treasury statistics, and information supplied by the U.S. 
International Trade Commission show imports of sugar from Canada 
from 1988 through the present. See also footnote 11.
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    The Department also considered whether dumping was eliminated after

[[Page 20256]]

the issuance of the order and import volumes for the subject 
merchandise declined significantly. Based on sales between April 1, 
1981 through March 31, 1982, the margin of dumping for BC Sugar was 
determined to be zero. Neither BC Sugar nor its successor, Rogers, has 
been subject to an administrative review since that time. We agree with 
the USBSA that, since the imposition of the order, total annual exports 
of sugar from Canada have been below the pre-order level of total 
annual exports of sugar from Canada. However, because Rogers is the 
only Canadian sugar producer subject to the order, we examined 
specifically the volume of Rogers' exports. In its substantive 
response, Rogers' provided the volume of its exports of subject 
merchandise for the most recent five fiscal years. In addition, Rogers 
reconstructed data for fiscal year 1979 exports from its predecessor, 
BC Sugar, and provided an approximation of the direct exports to the 
United States for that time period. A comparison of the volume data 
demonstrates that Rogers exports have not declined significantly since 
the issuance of the order. To the contrary, export volumes have 
increased significantly. Therefore, the Department preliminarily 
determines that dumping was eliminated by the sole Canadian sugar 
producer currently subject to the order and its export volumes have not 
declined significantly since the issuance of the order.
    With respect to the USBSA's arguments regarding the TRQ, and the 
tier 2 tariff, and the potential for the recurrence of dumping if the 
TRQ is lifted in 2002, we do not find these arguments persuasive for 
several reasons. First, the Department finds the USBSA's argument 
speculative. There is no evidence to suggest that the elimination of 
the TRQ is a certainty. In fact, from 1948 to the present, there has 
only been a total of seven years where the importation of sugar was 
completely unrestricted.10
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    \10\ Although access to the U.S. market for sugar was 
unrestricted, we note that Cuba has been barred from trading with 
the United States since 1962.
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    Second, if the United States were to eliminate all import 
restrictions on sugar from Canada and establish a market which tracked 
world prices, the Department finds no evidence to suggest that Rogers 
would resume dumping. Prior to the first post-order restrictions 
imposed in 1982, the Department established a deposit rate of zero 
percent for BC Sugar as a result of the 1981/1982 administrative review 
(48 FR 49327, October 25, 1983). As noted by both the USBSA and Rogers, 
beginning in 1982, the United States imposed quotas on imports of 
sugar. However, starting with the quota year October 1, 1990 through 
September 30, 1991, the United States implemented a TRQ which did not 
apply to Canada. Thus, Canadian exports were unrestricted until January 
1, 1995, when a separate global quota of 22,000 MT was established and 
Canada was made subject to that quota. We found that, during the period 
of unrestricted Canadian access to the U.S. market (1991-1994), the 
volume of imports of sugar from Canada increased; imports increased 
from 34.7 million in 1990 to 74.6 million in 1991.11 If, as 
the USBSA argued in this sunset review, an increased volume of imports 
will be accompanied by increased dumping, the domestic industry could 
have requested an administrative review during the period of 
unrestricted Canadian access. However, the Department did not receive a 
request for administrative review despite the fact that exports by the 
only Canadian producer subject to the order were subject to a deposit 
rate of zero percent. Therefore, the Department finds no reason to 
believe that dumping was occurring during this period.
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    \11\ These statistics reflect imports of sugar under HTS item 
numbers 1701.11, 1701.12, 1701.91, 1701.99, 1702.90, and 2106.90, 
which are broader than the scope of the order. These statistics were 
obtained from the Commission (http://dataweb.usitc.gov) and were 
compiled from tariff and trade data from the U.S. Department of 
Commerce, the U.S. Treasury, and the Commission.
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    With respect to the USBSA's assertions regarding Rogers' planned 
expansion and modernization of its sugar beet processing facility, as 
noted above, Rogers provided production data which supports its 
assertion that increased capacity at its Taber facility replaces 
capacity at its recently closed Winnipeg facility. In fact, the sugar 
production information provided by Rogers supports its assertion that 
sugar production, although increasing since the low of 1997, continues 
to be, and is forecasted to be less than production in 1994.
    The USBSA also stated that while the TRQ and tier 2 tariff have 
been effective in limiting imports into the United States, decreases in 
world prices will cause Rogers to increase exports to the United States 
above the quota level despite the tier 2 tariff. We agree that the TRQ 
and tier 2 tariff have been effective in limiting imports into the 
United States. Our review of data, including U.S. Census Bureau IM146 
reports, indicates that Canadian exports of the subject merchandise 
have not exceeded the Canada-specific and/or global TRQ level since it 
was first applied to Canada in 1995.12 Based on U.S. Census 
Bureau IM146 reports and import statistics provided by Rogers, the 
Department finds no evidence to suggest that Rogers' exports have ever 
exceeded the tier 1 tariff level.
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    \12\ In telephone conversations with U.S. Department of 
Agriculture officials, they indicated that it is highly unlikely 
that any Canadian sugar subject to this antidumping duty order has 
entered the United States at the tier 2 level.
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    As to future decreases in world market prices, we note that the 
information provided by the USBSA on world refined sugar prices since 
1990, shows that prices have fluctuated over this time period, with 
prices in fiscal year 1998 being only marginally below fiscal year 1993 
prices. Therefore, the recent decrease in the world refined sugar price 
is not unprecedented. Additionally, the USBSA asserted that the major 
catalysts in the rapid decline of world sugar prices are a drop in 
demand in Asia and Russia as a result of the financial crisis in those 
regions.13 However, according to FAS Online, ``[i]ndustry 
sources believe that sugar consumption will continue to grow in the 
Asian region, despite recent economic troubles, as sugar is seen as a 
staple commodity in the Asian diet.'' 14 Additionally, FAS 
Online notes that ``if the Government of Russia retracts the new 
tariffs on sugar and banks are able to facilitate trade, Russia could 
resume it's position as the world's major sugar importer early in 
1999.'' 15 Therefore, we are not persuaded that the world 
market price of sugar will continue to fall as asserted by the USBSA.
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    \13\ The USBSA cited to The Czarnikow Sugar Review, No. 1889 
(``Fears of Slower Far East Demand Impact Prices'') (February 1998), 
attached as part of Appendix 6 to USBSA's Substantive Response 
(November 2, 1998).
    \14\ FAS Online article ``World Sugar Situation,'' available at 
``http://www.usda.gov/htp/sugar/1998/98-11/world.html'.
    \15\ Id.
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    Furthermore, the USBSA suggested that the continued reduction in 
the world price of sugar will enable Canadian sugar exporters (as well 
as exporters from other countries) to ship subject merchandise into the 
United States and pay the tier 2 tariff, precipitating an influx of 
dumped sugar into the United States. However, given the absence of 
restrictions on imports of sugar into Canada, we agree with Rogers 
that, if the world price of sugar declines, we would expect a 
commensurate decline in the Canadian home market price. Therefore, a 
decrease in the world price of sugar does not, by itself, suggest that 
Rogers would resume dumping if the order were to be revoked.

[[Page 20257]]

    Finally, with respect to the USBSA's arguments that current pricing 
information demonstrates dumping, we note that the USBSA did not 
provide evidence of ``good cause'' to support the Department's use of 
current pricing information (see section 351.218(d)(3)(iv) of the 
Sunset Regulations). However, even considering the substance of the 
USBSA's arguments, we note that there was a significant discrepancy 
between the values the USBSA and Rogers reported. Both the USBSA and 
Rogers supplied information related to Canadian and U.S. pricing and 
cost of production. The USBSA based its estimated dumping margins on 
U.S. wholesale prices, Canadian wholesale prices, and estimated 
transportation costs. The USBSA utilized a price from Rogers' 
Saskatchewan Price List as the Canadian wholesale price. In its 
rebuttal comments, however, Rogers argued that Canadian sellers operate 
on high list prices and high discounts and, because of this, the 
published list price of Rogers is much higher than its actual 
discounted price. Rogers submitted copies of record bulk sales invoices 
to Canadian customers, which supported its assertion that sales are 
discounted. These discounted prices were significantly below the price 
used by the USBSA to represent the Canadian market price. Rogers also 
provided its average annual prices into the United States for the past 
eight years. The value Rogers reported as its export price into the 
United States differed from the U.S. price used by the USBSA in its 
calculations. Finally, there was a significant difference in the cost 
of production values reported by both parties. 16 Therefore, 
we preliminarily determine that the information submitted by Rogers in 
its substantive and rebuttal responses refutes the more generalized 
data provided by the USBSA.
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    \16\  With respect to the USBSA's constructed value 
calculations, the Department finds these calculations to be 
speculative. Specifically, the calculations used 1994/95 data on the 
average total cost of production together with 1998 data on the U.S. 
wholesale price of sugar, 1998 data on the cost of transportation 
and, for one of the two constructed value calculations, the 1998 
tier 2 tariff rate. The use of 1994/1995 data in 1998 dumping margin 
calculations suggests that findings from such calculations would be 
highly speculative.
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    Based on this analysis, the Department preliminarily finds, 
consistent with the SAA at 889-90, and the House Report at 63, that 
declining (or no) dumping margins accompanied by steady or increasing 
imports may indicate that foreign companies do not have to dump to 
maintain market share in the United States and that dumping is less 
likely to continue if the order were revoked.'' That is, the Department 
preliminarily finds that the continued absence of a dumping margin for 
Rogers and the continued existence of imports from Rogers in 
substantial quantities demonstrates that Rogers is capable of selling 
the subject merchandise in the United States without dumping. Further, 
the Department preliminarily finds no evidence to suggest that Rogers 
would begin dumping subject merchandise in the foreseeable future, 
regardless of the existence or absence of any outside importation 
restrictions. Therefore, the Department preliminarily determines that 
dumping is not likely to recur if the order were revoked.

Magnitude of the Margin

Parties' Comments

    In its substantive response, the USBSA argued that the dumping 
margin likely to prevail is at least as large as the margin that 
prevailed at the time of the original investigation. The highest 
dumping margin established in the original investigation was US$0.0237/
lb.17 Further, based on current U.S. and Canadian pricing, 
the USBSA estimated dumping margins ranging from 9.3 percent to 409.0 
percent.
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    \17\ See Antidumping Duty Order; Sugar and Syrups from Canada, 
45 FR 24128 (April 9, 1980).
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    In its substantive response, Rogers argued that, given the price 
spread between the U.S. supply-managed sugar market and the Canadian 
market based on world pricing, the dumping margin likely to prevail if 
the order were to be revoked is zero. Rogers argued that, because of 
its limited access to the U.S. market, it is motivated to sell at U.S. 
refined sugar prices to maximize returns. Rogers provided a chart 
depicting sugar prices in the Canadian and U.S. markets and its price 
into the United States for the past eight years, as well as a 
calculation for producing processed beet sugar at its facility in 
Canada. The chart indicates that Rogers' price into the United States 
has been above its prices in Western Canada.

Department's Determination

    Because we preliminarily determine that dumping is not likely to 
recur were the order revoked, there is no magnitude of the margin of 
dumping to report to the Commission.

Preliminary Results of Review

    The Department preliminarily finds that revocation of the order is 
not likely to lead to continuation or recurrence of dumping. As a 
result of this determination, the Department, pursuant to section 
751(d)(2) of the Act, preliminarily intends to revoke the antidumping 
duty order on sugar and syrups from Canada. Pursuant to section 
751(c)(6)(A)(iv) of the Act, this revocation would be effective January 
1, 2000. The Department preliminarily intends to instruct the U.S. 
Customs service to liquidate without regard to dumping duties entries 
of the subject merchandise entered or withdrawn from warehouse on or 
after January 1, 2000 (the effective date), and to discontinue 
collection of cash deposits on entries of subject merchandise as of the 
same date.
    Any interested party may request a hearing within 30 days of 
publication of this notice in accordance with 19 CFR 351.310(c). Any 
hearing, if requested, will be held on June 15, 1999. Interested 
parties may submit case briefs no later than June 8, 1999, in 
accordance with 19 CFR 351.309(c)(1)(i). Rebuttal briefs, which must be 
limited to issues raised in the case briefs, may be filed not later 
than June 14, 1999, in accordance with 19 CFR 351.309(d). The 
Department will issue a notice of final results of this sunset review, 
which will include the results of its analysis of issues raised in any 
such comments, no later than August 27, 1999.
    This five-year (``sunset'') review and notice are in accordance 
with sections 751(c), 752, and 777(i)(1) of the Act.

    Dated: April 19, 1999.
Robert S. LaRussa,
Assistant Secretary for Import Administration.
[FR Doc. 99-10287 Filed 4-23-99; 8:45 am]
BILLING CODE 3510-DS-P