[Federal Register Volume 64, Number 214 (Friday, November 5, 1999)] [Notices] [Pages 60422-60424] From the Federal Register Online via the Government Publishing Office [www.gpo.gov] [FR Doc No: 99-29062] ----------------------------------------------------------------------- DEPARTMENT OF COMMERCE International Trade Administration [A-821-811] Preliminary Determination of Critical Circumstances: Solid Fertilizer Grade Ammonium Nitrate From the Russian Federation AGENCY: Import Administration, International Trade Administration, Department of Commerce. EFFECTIVE DATE: November 5, 1999. FOR FURTHER INFORMATION CONTACT: Doreen Chen at (202) 482-0408 or Rick Johnson at (202) 482-3818, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, N.W., Washington, D.C. 20230. Preliminary Determination of Critical Circumstances The Applicable Statute and Regulations Unless otherwise indicated, 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 (URAA). In addition, unless otherwise indicated, all citations to the Department's regulations are references to the provisions codified at 19 CFR Part 351 (1999). Critical Circumstances On August 12, 1999, the Department of Commerce (``the Department'') initiated an investigation to determine whether imports of solid fertilizer grade ammonium nitrate from the Russian Federation (``Russia'') are being, or are likely to be, sold in the United States at less than fair value. In the petition filed on July 23, 1999, petitioner alleged that there is a reasonable basis to believe or suspect that critical circumstances exist with respect to imports of solid fertilizer grade ammonium nitrate from Russia. On September 3, 1999, the International Trade Commission (``ITC'') determined that there was threat of material injury to the domestic industry from imports of solid fertilizer grade ammonium nitrate from Russia. In accordance with 19 CFR 351.206(c)(2)(i), because petitioner submitted a critical circumstances [[Page 60423]] allegation more than 20 days before the scheduled date of the preliminary determination, the Department must issue a preliminary critical circumstances determination no later than the date of the preliminary determination. In a policy bulletin issued on October 8, 1998 (Policy Bulletin Number 98.4), the Department stated that it may issue a preliminary critical circumstances determination prior to the date of the preliminary LTFV determination, assuming adequate evidence of critical circumstances exists (see Change in Policy Regarding Timing of Issuance of Critical Circumstances Determinations, 63 FR 55364 (October 15, 1998)). In accordance with this policy, we are issuing a preliminary critical circumstances decision in the investigation of imports of solid fertilizer grade ammonium nitrate from Russia. Section 733(e)(1) of the Act provides that the Department will determine that critical circumstances exist if there is a reasonable basis to believe or suspect that: (A)(i) there is a history of dumping and material injury by reason of dumped imports in the United States or elsewhere of the subject merchandise, or (ii) the person by whom, or for whose account, the merchandise was imported knew or should have known that the exporter was selling the subject merchandise at less than its fair value and that there was likely to be material injury by reason of such sales, and (B) there have been massive imports of the subject merchandise over a relatively short period. History of Dumping and Importer Knowledge To determine whether there is a history of injurious dumping of the merchandise under investigation, in accordance with section 733(e)(1)(A)(i), the Department considers evidence of existing antidumping orders on solid fertilizer grade ammonium nitrate from Russia in the United States or elsewhere to be sufficient. To support a finding of history of injurious dumping of Russian ammonium nitrate, the petition states that the European Community (``EC'') issued an antidumping order in 1995 on imports of ammonium nitrate from Russia. This order remains in effect today. The existence of an antidumping order on Russian ammonium nitrate in the EC is sufficient evidence of a history of injurious dumping. Accordingly, there is no need to examine importer knowledge. Massive Imports In determining whether there are ``massive imports'' over a ``relatively short time period,'' the Department ordinarily bases its analysis on import data for at least the three months preceding (the ``base period'') and following (the ``comparison period'') the filing of the petition. Imports normally will be considered massive when imports during the comparison period have increased by 15 percent or more compared to imports during the base period. However, as stated in the Department's regulations at section 351.206(i), if the Secretary finds that importers, exporters, or producers had reason to believe, at some time prior to the beginning of the proceeding, that a proceeding was likely, then the Secretary may consider a time period of not less than three months from that earlier time. In this case, petitioner argues that importers, exporters, or producers of Russian solid fertilizer grade ammonium nitrate had reason to believe that an antidumping proceeding was likely before the filing of the petition. The Department examined whether conditions in the industry and published reports and statements provide a basis for inferring knowledge that an antidumping investigation on the subject merchandise was likely. The Department found that, as a result of an investigation on Russian ammonium nitrate imports by the International Trade Commission under section 332(g) of the Tariff Act of 1930, as amended (published on May 6, 1998), there was considerable press coverage discussing concerns of ammonium nitrate producers, among others, concerning the influx of imports of subject merchandise and the likelihood of a remedial trade action, including the filing of an antidumping petition. On December 3, 1998, a coalition of U.S. producers of solid fertilizer grade ammonium nitrate formed the Committee for Fair Ammonium Nitrate Trade (``COFANT''), to monitor developments with respect to the importation of ammonium nitrate and to pursue available remedies, should unfair trade practices be identified. On December 7, 1998, the formation of this coalition was reported in a trade publication. Significantly, this trade publication also reported in the same article that ``some of the committee members already have been active in trying to get federal officials to find evidence of Russian AN dumping.'' See Petition for the Imposition of Antidumping Duties: Solid Agricultural Grade Ammonium Nitrate from the Russian Federation (July 23, 1999) at Exhibit 37, p. 5. The press coverage leading up to the formation of COFANT and the announcement thereof in early December 1998, including the explicit reference to a dumping action against imports of ammonium nitrate from Russia, are sufficient evidence that the Russian producers and importers were on notice that an antidumping proceeding concerning the subject merchandise was likely. Thus, we preliminarily determine that by early December 1998, importers, exporters, or producers knew or should have known that a proceeding was likely concerning solid fertilizer grade ammonium nitrate from Russia (see discussion in the Determination of Critical Circumstances Memorandum, November 1, 1999). Therefore, we examined the increase in import volumes during the period of December 1998 through May 1999 as compared to June 1998 through November 1998. The Department found that imports of subject merchandise escalated by over 257.88 percent (see Attachment 1 to the Determination of Critical Circumstances Memorandum). Furthermore, while the record indicated that seasonality might account for some of that increase, we preliminary determine that the 257.88 percent increase is not simply a function of seasonality, as the actual volume increase from the period December to May compared to the same period in the previous two years indicates an actual volume increase of 88.31 percent (see Attachment 2 to the Determination of Critical Circumstances Memorandum). Therefore, pursuant to section 733(e) of the Act and section 351.206(h) of the Department's regulations, we preliminarily determine that there have been massive imports of solid fertilizer grade ammonium nitrate from Russia over a relatively short time. Conclusion We preliminarily determine that there is a reasonable basis to believe or suspect that critical circumstances exist for imports of solid fertilizer grade ammonium nitrate from Russia. Suspension of Liquidation In accordance with section 733(e)(2) of the Act, upon issuance of an affirmative preliminary determination of sales at less than fair value in the investigation, the Department will direct the U.S. Customs Service to suspend liquidation of all entries of solid fertilizer grade ammonium nitrate from Russia, as appropriate, that are entered, or withdrawn from warehouse, for consumption on or after 90 days prior to the date of publication in the Federal Register of our preliminary determination of sales at less than fair value. The Customs Service shall [[Page 60424]] require a cash deposit or posting of a bond equal to the estimated preliminary dumping margin reflected in the preliminary determination of sales at less than fair value published in the Federal Register. This suspension of liquidation will remain in effect until further notice. Final Critical Circumstances Determination We will make a final determination concerning critical circumstances for Russia when we make our final determination regarding sales at less than fair value in this investigation, which will be 75 days after the preliminary determination regarding sales at less than fair value, unless this investigation is extended. ITC Notification In accordance with section 733(f) of the Act, we have notified the ITC of our determination. This notice is published pursuant to section 777(i) of the Act. Dated: November 1, 1999. Robert S. LaRussa, Assistant Secretary for Import Administration. [FR Doc. 99-29062 Filed 11-4-99; 8:45 am] BILLING CODE 3510-DS-P