[Federal Register Volume 66, Number 43 (Monday, March 5, 2001)]
[Notices]
[Pages 13286-13292]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-5156]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-823-810]


Notice of Preliminary Determination of Sales at Less Than Fair 
Value and Postponement of Final Determination: Solid Agricultural Grade 
Ammonium Nitrate From Ukraine

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

ACTION: Notice of preliminary determination of sales at less than fair 
value.

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SUMMARY: We preliminarily determine that solid agricultural grade 
ammonium nitrate from Ukraine is being, or is likely to be, sold in the 
United States at less than fair value, as provided in section 733 of 
the Tariff Act of 1930, as amended. The estimated dumping margin for 
J.S.C. ``Concern'' Stirol is 113.38 percent. The Ukraine-wide rate, 
which is applicable to all other producers/exporters, is 113.38 
percent. We also preliminarily determine that critical circumstances 
exist.
    Interested parties are invited to comment on this preliminary 
determination. If this investigation proceeds on the current schedule, 
we will make our final determination not later than 105 days after the 
date of publication of this preliminary determination in the Federal 
Register.

EFFECTIVE DATE: March 5, 2001.

FOR FURTHER INFORMATION CONTACT: Melani Miller or Jarrod Goldfeder, 
Import Administration, International Trade Administration, U.S. 
Department of Commerce, 14th Street and Constitution Avenue, NW., 
Washington, DC 20230; telephone: (202) 482-0116 or (202) 482-0189, 
respectively.

The Applicable Statute

    Unless otherwise indicated, all citations to the Tariff Act of 
1930, as

[[Page 13287]]

amended (``the Act''), are references to the provisions effective 
January 1, 1995, the effective date of the amendments made to the Act 
by the Uruguay Round Agreements Act (``URAA''). In addition, unless 
otherwise indicated, all citations to the Department of Commerce (``the 
Department'') regulations are to the regulations at 19 CFR part 351 
(April 2000).

SUPPLEMENTARY INFORMATION

Case History

    Since the initiation of this investigation on November 8, 2000 (see 
Initiation of Antidumping Duty Investigation: Solid Agricultural Grade 
Ammonium Nitrate from Ukraine, 65 FR 66966 (November 8, 2000) (``Notice 
of Initiation'')), the following events have occurred:
    In the Notice of Initiation, the Department invited parties to 
comment on the request made by the petitioner (the Committee for Fair 
Ammonium Nitrate Trade) for an expedited preliminary determination. On 
November 13, 2000, we received comments from J.S.C. ``Concern'' Stirol 
(``Stirol''), a Ukrainian producer/exporter of the subject merchandise; 
the petitioner; and ConAgra, Inc. (``ConAgra''), an interested party 
and importer of the subject merchandise. Based on our review of these 
comments and the original request from the petitioner, we announced our 
intention to issue our preliminary determination by February 23, 2001. 
See November 22, 2000 memorandum to the Acting Deputy Assistant 
Secretary ``Whether to Expedite the Preliminary Determination,'' which 
is on file in Import Administration's Central Records Unit (``CRU''), 
Room B-099 of the main Department of Commerce building.
    On November 22, 2000, the Department issued an antidumping 
questionnaire to the Ukrainian Embassy in Washington, DC and requested 
that the Embassy forward the questionnaire to all Ukrainian producers/
exporters of subject merchandise that sold to the United States during 
the period of investigation (``POI''). The Department also sent the 
antidumping questionnaire directly to the four producers/exporters 
named in the petition.\1\
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    \1\ The four companies named in the petition were Stirol, Open 
Joint Stock Company ``AZOT'' Cherkassy (``Cherkassy''), J.S. Co. 
Rivneazot (``Rivneazot''), and Severodonetsk State Manufacturing 
Enterprise ``Azot Association'' (``Severodonetsk'').
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    Pursuant to the allegation of critical circumstances in the 
petition, the Department, in its November 22, 2000 questionnaire, also 
requested information regarding shipments of the subject merchandise to 
the United States for the period January 1998 through the most recent 
date for which data was available (including, at minimum, November 
2000). We received this information from Stirol on December 6, 2000. At 
the Department's request, Stirol submitted revised shipment data on 
February 7, 2001. No other company provided the requested information. 
The petitioner provided supplemental information with respect to its 
critical circumstances allegation on February 13, 2001. The critical 
circumstances analysis for this preliminary determination is discussed 
below in the ``Critical Circumstances'' section.
    Also on November 22, 2000, in response to a request by the 
petitioner to alter the POI, we issued a memorandum explaining our 
decision not to do so in this investigation. See November 22, 2000 
memorandum to the Acting Deputy Assistant Secretary ``Time Period for 
the Period of Investigation'' (``POI Memo''), which is on file in the 
Department's CRU. This issue is discussed further in the ``Period of 
Investigation'' section, below.
    On November 22, 2000, the Department also invited interested 
parties to comment on surrogate country selection and to provide 
publicly available information for valuing the factors of production. 
We received responses from the petitioner and Stirol on December 27, 
2000. Both Stirol and the petitioner filed rebuttal comments on 
surrogate values on January 3, 2001. Stirol and the petitioner 
submitted further surrogate value information on February 13, February 
15, February 16, February 20, and February 21, 2001.
    On November 27, 2000, the United States International Trade 
Commission (``ITC'') notified the Department of its affirmative 
preliminary injury determination in this case.
    On December 6, 2000, we received a response from Severodonetsk 
indicating that it did not make any shipments of the subject 
merchandise to the United States during the POI.
    On December 27, 2000, and January 12, 2001, the Department received 
questionnaire responses for Sections A, C, and D from Stirol. We issued 
supplemental questionnaires to Stirol on January 10 and January 24, 
2001, and received supplemental responses from Stirol on January 24 and 
February 7, 2001. We received comments on Stirol's responses from the 
petitioner on January 5 and January 19, 2001.
    With regard to Cherkassy, we received an improperly filed Section A 
response on December 27, 2000. This response was resubmitted by 
Cherkassy on January 12, 2001. We received comments on Cherkassy's 
Section A response from the petitioner on January 22, 2001. We issued a 
Section A supplemental questionnaire to Cherkassy on January 24, 2001. 
Despite the Department's numerous attempts to contact Cherkassy and to 
allow Cherkassy to file its responses, Cherkassy neither submitted a 
response to the Section A supplemental questionnaire nor to Sections C 
and D of the questionnaire.
    On January 3, 2001, we sent letters to Rivneazot and the Embassy of 
Ukraine informing them that, because we had not received any 
questionnaire responses from Rivneazot or from any other producer/
exporter of the subject merchandise, we were assuming that, other than 
the companies already participating, no other companies (including 
Rivneazot) would be participating in this investigation. In response, 
on January 30, 2001, the Embassy of Ukraine notified us that Rivneazot 
did not make any shipments of the subject merchandise to the United 
States during the POI. We received no other response to these letters.
    Finally, on February 13 and February 15, 2001, both the petitioner 
and Stirol provided comments and rebuttal comments on several issues 
related to the preliminary determination.

Postponement of Final Determination and Extension of Provisional 
Measures

    Pursuant to section 735(a)(2) of the Act, on February 13, 2001, 
Stirol requested that in the event of an affirmative preliminary 
determination in this investigation, the Department postpone its final 
determination by 30 days. At the same time, Stirol requested that the 
Department extend by 30 days the application of the provisional 
measures prescribed under 19 CFR 351.210(e)(2). In accordance with 19 
CFR 351.210(b), because (1) our preliminary determination is 
affirmative, (2) the requesting exporter accounts for a significant 
proportion of exports of the subject merchandise, and (3) no compelling 
reasons for denial exist, we are granting Stirol's request and are 
postponing the final determination until no later than 105 days after 
the publication of this notice in the Federal Register. Suspension of 
liquidation will be extended accordingly.

Scope of Investigation

    For purposes of this investigation, the products covered are solid, 
fertilizer grade ammonium nitrate (``ammonium

[[Page 13288]]

nitrate'') products, whether prilled, granular or in other solid form, 
with or without additives or coating, and with a bulk density equal to 
or greater than 53 pounds per cubic foot. Specifically excluded from 
this scope is solid ammonium nitrate with a bulk density less than 53 
pounds per cubic foot (commonly referred to as industrial or explosive 
grade ammonium nitrate). The merchandise subject to this investigation 
is classified in the Harmonized Tariff Schedule of the United States 
(``HTSUS'') at subheading 3102.30.00.00. Although the HTSUS subheadings 
are provided for convenience and for purposes of the Customs Service, 
the written description of the merchandise under investigation is 
dispositive.

Period of Investigation

    As noted above, the petitioner requested that the Department alter 
the normal POI called for in section 351.204(b)(1) of the Department's 
regulations to include the first quarter of 2000, either by defining 
the POI as the first and second quarters, or by expanding the POI to 
include the first, second, and third quarters. As explained in the POI 
Memo, we have not adopted the petitioner's suggested POI. Thus, the POI 
for this investigation corresponds to the two most recent fiscal 
quarters prior to the filing of the petition, i.e., April 1, 2000 
through September 30, 2000.

Nonmarket Economy Country and Market Oriented Industry Status

    The Department has treated Ukraine as a nonmarket economy (``NME'') 
country in all past antidumping investigations. See, e.g., Notice of 
Preliminary Determinations of Sales at Less Than Fair Value: Steel 
Concrete Reinforcing Bars from Poland, Indonesia, and Ukraine, 66 FR 
8343 (January 30, 2001) and Notice of Final Determination of Sales at 
Less Than Fair Value: Certain Cut-to-Length Carbon Steel Plate from 
Ukraine, 62 FR 61754 (November 19, 1997) (``CTL Plate from Ukraine''). 
This NME designation remains in effect until it is revoked by the 
Department (see section 771(18)(C) of the Act).
    The respondents in this investigation have not requested a 
revocation of Ukraine's NME status. We have, therefore, preliminarily 
determined to continue to treat Ukraine as an NME.

Separate Rates

    In an NME proceeding, the Department presumes that a single dumping 
margin is appropriate for all exporters unless a firm establishes that 
it is eligible for a separate rate. In this investigation, Stirol has 
requested that it be assigned a separate rate. Pursuant to this 
request, Stirol has provided the requested company-specific separate 
rates information and has stated that it is not subject to any element 
of governmental ownership or control. Although Cherkassy submitted 
information relating to separate rates, that information was 
incomplete.
    The Department establishes whether each exporting entity is 
entitled to a separate rate based on its independence from government 
control over its exporting activities by applying a test arising out of 
the Final Determination of Sales at Less Than Fair Value: Sparklers 
from the People's Republic of China, 56 FR 20588 (May 6, 1991), as 
modified by Final Determination of Sales at Less Than Fair Value: 
Silicon Carbide from the People's Republic of China (59 FR 22585, May 
2, 1994).
    The Department's separate rate test is not concerned, in general, 
with macroeconomic/border-type controls, e.g., export licenses, quotas, 
and minimum export prices, particularly if these controls are imposed 
to prevent dumping. The test focuses, rather, on controls over the 
investment, pricing, and output decision-making process at the 
individual firm level. See CTL Plate from Ukraine; Tapered Roller 
Bearings and Parts Thereof, Finished and Unfinished, from the People's 
Republic of China: Final Results of Antidumping Duty Administrative 
Review, 62 FR 61276 (November 17, 1997) (``TRBs IX''); and Honey from 
the People's Republic of China: Preliminary Determination of Sales at 
Less than Fair Value, 60 FR 14725, 14726 (March 20, 1995).
    Under the separate rates test, the Department assigns a separate 
rate in an NME case only if an individual respondent can demonstrate 
the absence of both de jure and de facto governmental control over its 
export activities:

1. Absence of De Jure Control

    The Department considers three factors which support, though do not 
require, a finding of de jure absence of governmental control. These 
factors include: (1) An absence of restrictive stipulations associated 
with an individual exporter's business and export licenses; (2) any 
legislative enactments decentralizing control of companies; or (3) any 
other formal measures by the government decentralizing control of 
companies (see, e.g., TRBs IX).
    Stirol has placed documents on the record that it claims 
demonstrate the absence of de jure governmental control, including the 
``Law of Ukraine On Economic Associations,'' the ``Law of Ukrainian SSR 
On Foreign Economic Activities,'' and the ``Edict of the President of 
Ukraine On Improvement of the Currency Regulation.'' These laws, 
enacted by the Government of Ukraine, demonstrate a significant degree 
of deregulation of Ukrainian business activity, as well as deregulation 
of Ukrainian export activity.
    Because the Government of Ukraine created a right of ownership of 
business enterprises for private persons and collectives, open joint-
stock companies, such as Stirol, are now distinct legal entities. 
According to Stirol, through this ownership right, it has the right to 
freely engage in economic activity, negotiate and sign contracts, and 
independently develop business plans. It also may independently choose 
its managers.
    In a prior case, CTL Plate from Ukraine, the Department analyzed 
Ukraine's laws and regulations, and found that they establish an 
absence of de jure control. We have no new information in this 
proceeding that would cause us to reconsider this determination. 
Moreover, although the Government of Ukraine does maintain export 
controls for certain categories of goods, Stirol states that the 
subject merchandise exported to the United States is not subject to any 
of these controls. Additionally, Stirol asserts that the subject 
merchandise does not appear on any government list regarding export 
provisions or licensing and that there are no export quotas applicable 
to the subject merchandise.
    Accordingly, we preliminarily determine that there is an absence of 
de jure governmental control over Stirol's export pricing and marketing 
decisions.

2. Absence of De Facto Control

    The Department typically considers four factors in evaluating 
whether a respondent is subject to de facto governmental control of its 
export functions: (1) Whether the export prices are set by, or subject 
to the approval of, a governmental authority; (2) whether the 
respondent has authority to negotiate and sign contracts and other 
agreements; (3) whether the respondent has autonomy from the government 
in making decisions regarding the selection of its management; and (4) 
whether the respondent retains the proceeds of its export sales and 
makes independent decisions regarding disposition of profits or 
financing of losses (see Final Determination of Sales at Less Than Fair 
Value: Certain Preserved Mushrooms from the People's

[[Page 13289]]

Republic of China, 63 FR 72255 (December 31, 1998)).
    Stirol has asserted (and has provided supporting documentation) 
that it: (1) Establishes its own export prices; (2) negotiates 
contracts without guidance from any governmental entities or 
organizations; (3) makes its own personnel decisions with regard to the 
selection of management; and (4) retains the proceeds from export sales 
(although 50 percent of foreign currency earnings must be converted 
into Ukrainian currency) and uses profits according to its business 
needs without any restrictions. Additionally, Stirol has stated that it 
does not coordinate or consult with other exporters regarding its 
pricing. This information supports a preliminary finding that there is 
an absence of de facto governmental control of the export functions of 
Stirol.
    Consequently, subject to verification, we preliminarily determine 
that Stirol has met the criteria for the application of separate rates. 
Also, because Cherkassy failed to provide the information needed to 
support its claim for a separate rate, we preliminarily determine that 
Cherkassy is subject to the Ukraine-wide rate, discussed below.

Ukraine-Wide Rate

    Information on the record of this investigation indicates that 
Stirol, the only company that demonstrated its eligibility for a 
separate rate, did not account for all exports of subject merchandise 
to the United States from Ukraine during the POI. Therefore, because we 
presume that NME producers/exporters that are not eligible for a 
separate rate do not act independently from the government, we 
preliminarily determine that all Ukrainian producers/exporters of 
ammonium nitrate, other than Stirol, failed to respond to our 
questionnaire.
    Section 776(a)(2) of the Act provides that ``if an interested party 
or any other person (A) withholds information that has been requested 
by the administering authority or the Commission under this title, (B) 
fails to provide such information by the deadlines for submission of 
the information or in the form and manner requested, subject to 
subsections (c)(1) and (e) of section 782, (C) significantly impedes a 
proceeding under this title, or (D) provides such information but the 
information cannot be verified as provided in section 782(i), the 
administering authority and the Commission shall, subject to section 
782(d), use the facts otherwise available in reaching the applicable 
determination under this title.'' Pursuant to section 782(e) of the 
Act, the Department shall not decline to consider information that is 
submitted by an interested party and that is necessary to the 
determination, even if that information does not meet all the 
applicable requirements established by the Department, if all of the 
following requirements are met: (1) The information is submitted by the 
deadline established for its submission; (2) the information can be 
verified; (3) the information is not so incomplete that it cannot serve 
as a reliable basis for reaching the applicable determination; (4) the 
interested party has demonstrated that it acted to the best of its 
ability in providing the information and meeting the requirements 
established by the Department with respect to the information; and (5) 
the information can be used without undue difficulties.
    Section 776(b) of the Act further provides that adverse inferences 
may be used when an interested party has failed to cooperate by not 
acting to the best of its ability to comply with a request for 
information. In this case, except for Stirol, any Ukrainian producers/
exporters of subject merchandise that exported to the United States 
during the POI failed to act to the best of their ability by not 
providing a response to the Department's questionnaire. Thus, the 
Department has determined that, in selecting from among the facts 
otherwise available, an adverse inference is warranted.
    It is the Department's practice to assign to respondents which do 
not provide a full response to the Department's antidumping 
questionnaire the higher of: (1) The highest margin stated in the 
notice of initiation; or (2) the highest margin calculated for any 
respondent in the investigation (see, e.g., Notice of Final 
Determination of Sales at Less Than Fair Value: Stainless Steel Wire 
Rod from Japan, 63 FR 40434 (July 29, 1998)). In this case, the highest 
margin on record is 257 percent, the rate from the petition as 
recalculated by the Department in the Notice of Initiation.
    Section 776(c) of the Act provides that where the Department 
selects from among the facts otherwise available and relies on 
``secondary information,'' such as the petition, the Department shall, 
to the extent practicable, corroborate that information from 
independent sources reasonably at the Department's disposal. The 
Statement of Administrative Action accompanying the URAA, H.R. Doc. No. 
103-316 (1994) (SAA), states that ``corroborate'' means to determine 
that the information used has probative value. See SAA at 870.
    In order to determine the probative value of the information used 
to calculate the Ukraine-wide rate, we examined evidence supporting the 
calculations in the petition. In accordance with section 776(c) of the 
Act, to the extent practicable, we examined the key elements of the 
export price (``EP'') and normal value (``NV'') calculations on which 
the petition margin calculations were based. The petitioner's 
methodology for calculating EP and NV is discussed in the Notice of 
Initiation. To corroborate the petitioner's EP calculations, we 
compared the U.S. sales prices in the petition to official U.S. 
government import statistics for the subject merchandise during the 
POI. To corroborate the petitioner's NV calculations, we compared the 
factor consumption rates for the most significant inputs reported in 
the petition to the factor consumption rates reported by Stirol, the 
only responding company in this investigation. Regarding the factor 
values, because the Department has preliminarily determined to use a 
different surrogate country than was used in the petition, we have 
substituted the factor values developed for this preliminary 
determination for those in the petition. In instances where a factor 
was reported in the petition for which we did not develop a surrogate 
value, we continued to use the value in the petition.
    After making these changes, we found that the margin calculated for 
Stirol, 113.38 percent, is the highest margin on the record of this 
case.\2\ Since this margin is a calculated margin in this 
investigation, this margin does not represent secondary information, 
and, thus, does not need to be corroborated. Thus, the Department has 
preliminarily determined the Ukraine-wide rate to be 113.38 percent. 
For the final determination, the Department will consider all margins 
on the record at that time for the purpose of determining the most 
appropriate margin based on adverse facts available.
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    \2\ See, also, February 23, 2001, memorandum to the Deputy 
Assistant Secretary ``Preliminary Determination Adverse Facts 
Available Rate,'' which is on file in the Department's CRU.
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Fair Value Comparisons

    To determine whether sales of the subject merchandise by Stirol for 
export to the United States were made at less than fair value, we 
compared EP to NV, as described in the ``Export Price'' and ``Normal 
Value'' sections of this notice, below. In accordance with section 
777A(d)(1)(A)(i) of the Act, we compared POI-wide weighted-average EPs 
to the NVs.

[[Page 13290]]

Export Price

    For Stirol, we used EP methodology in accordance with section 
772(a) of the Act because the subject merchandise was sold directly to 
unaffiliated customers in the United States prior to importation, and 
constructed export price (``CEP'') methodology was not otherwise 
appropriate. We calculated EP based on FOB Ukrainian port prices. Where 
appropriate, we made deductions from the starting price (gross unit 
price) for inland freight from the plant/warehouse to the port of 
export and foreign brokerage and handling expenses. Because the 
domestic inland freight and brokerage and handling expenses were paid 
in a nonmarket economy currency, we based these charges on surrogate 
values from Indonesia. (See ``Normal Value'' section below for further 
discussion.)

Normal Value

1. Surrogate Country

    Section 773(c)(4) of the Act requires the Department to value the 
NME producer's factors of production, to the extent possible, in one or 
more market economy countries that: (1) Are at a level of economic 
development comparable to that of the NME, and (2) are significant 
producers of comparable merchandise. Regarding the first criterion, the 
Department has determined that Pakistan, Indonesia, Sri Lanka, the 
Philippines, and Egypt are countries comparable to Ukraine in terms of 
overall economic development (see memorandum from Jeff May, Director, 
Office of Policy, to Susan Kuhbach, Office Director, AD/CVD 
Enforcement, Office 1, dated November 14, 2000 (``Surrogate Country 
Memorandum'')). The petitioner has alleged that India is also 
economically comparable to Ukraine based on a comparison of per capita 
GNP in 1998 and 1999.
    Regarding the second criterion (related to significant production 
of comparable merchandise), Stirol has argued that, among the countries 
that are economically comparable to Ukraine, Indonesia and Egypt are 
significant producers of merchandise comparable to ammonium nitrate. 
The petitioner has alleged that India, Indonesia, and Pakistan are 
significant producers of comparable merchandise.
    The petitioner argues that the Department should depart from the 
Surrogate Country Memorandum, as it has done in past cases, and select 
India as the appropriate surrogate country in this investigation. See, 
e.g., Notice of Final Determination of Sales at Less Than Fair Value: 
Certain Small Diameter Carbon and Alloy Seamless Standard, Line and 
Pressure Pipe From Romania, 65 FR 39125 (June 23, 2000) (determining 
that, although not included in the original Office of Policy surrogate 
country memorandum, Indonesia was the most appropriate surrogate 
country for Romania because Indonesia was a significant producer of 
merchandise comparable to the subject merchandise and, contrary to 
other potential surrogate countries, provided reliable surrogate values 
for virtually all factors of production) (``Pipe from Romania''). While 
conceding that Indonesia is a suitable surrogate country, the 
petitioner claims that India is a more appropriate surrogate because, 
in addition to satisfying the two statutory criteria, India has the 
most complete and reliable set of publicly available information among 
possible surrogate countries. Moreover, the petitioner asserts that 
India is a more significant producer of comparable merchandise than 
Indonesia. Finally, the petitioner was able to obtain the financial 
statements of an Indian producer of ammonium nitrate to use in valuing 
selling, general, and administrative expenses (``SG&A''), profit, and 
overhead expenses, whereas the Indonesian data obtained by the 
petitioner pertained to a urea producer.
    Stirol argues that Indonesia and Egypt are suitable surrogate 
countries as both satisfy the statutory criteria. For Indonesia, Stirol 
was able to obtain contemporaneous and reliable surrogate data, 
including official Indonesian import statistics for valuing all raw 
material inputs and audited financial reports from Indonesia producers 
of identical and comparable merchandise for purposes of calculating 
overhead, SG&A, and profit. Stirol was not able to obtain data for 
Egypt.
    Stirol objects to the use of India as a surrogate country, 
asserting that India is not economically comparable to Ukraine. 
Although the two countries are similar in terms of per capita GDP, 
Stirol argues that, according to The World Factbook 2000, India is not 
comparable to Ukraine in terms of overall economic development. See 
Pipe from Romania, 65 FR at 39125 (noting that Indonesia was included 
among the countries that are economically comparable to Romania because 
Indonesia's GNP per capita and overall economic development were 
similar to the countries listed in the Office of Policy surrogate 
country memorandum). Finally, Stirol argues that the public data 
available for India is neither reliable nor contemporaneous with the 
POI.
    For purposes of the preliminary determination, we have used 
Indonesia as our surrogate. As noted in the Surrogate Country 
Memorandum, Indonesia is economically comparable to Ukraine. Indonesia 
is also a significant producer of merchandise similar to the 
merchandise under investigation. Although the Department has the 
authority to select a country that is not included in the Surrogate 
Country Memorandum, there should be a good reason to do so. In this 
case, Indonesia was identified in the Surrogate Country Memorandum as 
being economically comparable to Ukraine. Indonesia is also a 
significant producer of comparable merchandise. Moreover, there is 
sufficient publicly available information on Indonesian values. 
Accordingly, we have calculated normal value using publicly available 
information from Indonesia to value Stirol's factors of production, 
except where noted below.

2. Factors of Production

    In accordance with section 773(c) of the Act, we calculated NV 
based on the factors of production reported by Stirol using Indonesian 
values, except where noted below.
    In selecting the surrogate values, we considered the quality, 
specificity, and contemporaneity of the data. For those values not 
contemporaneous with the POI, unless otherwise noted below, we adjusted 
for inflation using price indices published in the International 
Monetary Fund's International Financial Statistics. As appropriate, we 
adjusted input values to make them delivered prices.
    For a detailed analysis of surrogate values, see the memorandum 
from the Team to the File, dated February 23, 2001, ``Valuation of 
factors of production for the preliminary determination,'' which is on 
file in the Department's CRU.
    Natural Gas: For purposes of valuing natural gas as both a material 
input and energy input, we used publicly available natural gas data for 
Indonesia for 1998 derived from the Second Quarter 2000 Energy Prices & 
Taxes, which is published by the International Energy Agency of the 
OECD (``Energy Prices & Taxes''). To inflate the 1998 Energy Prices and 
Taxes natural gas value to the POI, we used a regional inflation index 
specific to the energy sector.
    Auxiliary Materials and Catalysts: With the exception of denatured 
alcohol, belting, and materials purchased from a market economy country 
and paid for in a market economy currency, we valued all of the other 
material inputs and catalysts using Indonesian import statistics 
obtained

[[Page 13291]]

from the Indonesian Bureau of Statistics. For denatured alcohol, 
because we found the Indonesian import statistics to be unreliable, we 
valued these inputs using Indian import statistics. To value belting, 
we used an Indian price quote from a published news article. For 
materials purchased from market economy suppliers that were paid for in 
market economy currency (i.e., lilamine, potassium hydroxide, and 
ukon), we used the actual purchase prices paid by Stirol during the 
POI.
    Labor: We valued labor using the method described in 19 CFR 
351.408(c)(3).
    Energy: To value electricity, we used the 1997 electricity rates 
reported in Energy Prices and Taxes.
    Inland Freight Rates: To value truck freight, we used a August 1999 
rate quote from an Indonesian trucking company. With regard to rail 
freight, we used a February 2001 rail rate from an Indonesian rail 
company obtained by the Department from the American Embassy in 
Jakarta, Indonesia.
    Brokerage and Handling: We valued brokerage and handling using 
publicly available February 2001 price quotes from an Indonesian 
freight forwarder that provides both import-and export-related cargo 
services.
    Factory Overhead, SG&A, and Profit: We derived ratios for factory 
overhead, SG&A, and profit using the 1999 annual report of one 
Indonesian producer of a product similar to the subject merchandise.

Critical Circumstances

    The petitioner has alleged that there is a reasonable basis to 
believe or suspect that critical circumstances exist with respect to 
imports of ammonium nitrate from Ukraine.\3\ The petitioner submitted 
information supplementing its allegation on February 13, 2001.
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    \3\ For a further discussion of the Department's critical 
circumstances analysis, see February 23, 2001, memorandum to the 
Deputy Assistant Secretary ``Critical Circumstances Preliminary 
Determination: Massive Imports,'' which is on file in the 
Department's CRU.
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    According to section 733(e) of the Act, the Department may make a 
critical circumstances determination at any time after initiation of an 
investigation, including prior to a preliminary determination of 
dumping, assuming adequate evidence of critical circumstances is 
available. The Department's policy bulletin No. 98.4 of October 15, 
1998,\4\ provides further guidance on this section of the Act, stating 
that, if the facts of a case show that importers, exporters, or 
producers had knowledge that a case was likely to be filed, and the 
other statutory and regulatory criteria are met, the Department should 
issue its preliminary finding on critical circumstances before the 
preliminary determination, and as soon as possible after the 
initiation.
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    \4\ See Department October 15, 1998 Policy Bulletin No. 98.4, 
``Timing of Issuance of Critical Circumstances Determinations'' 
(``policy bulletin''), which can be found on the Department's web 
page at http://ia.ita.doc.gov.
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    While the petitioner did include arguments and evidence relating to 
critical circumstances in the petition, the petitioner did not provide 
at that time evidence that importers, exporters, or producers of 
ammonium nitrate had early knowledge of the case. This evidence was 
only provided on February 13, 2001. Thus, there was not sufficient 
information on the record for the Department to make an early 
preliminary critical circumstances determination. Therefore, we are 
making our preliminary critical circumstances determination in 
conjunction with this preliminary less than fair value determination.
    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.
    With respect to the first criterion, there is currently an 
antidumping duty order on ammonium nitrate from Ukraine in the European 
Community (``EC''). The existence of an antidumping duty order in the 
EC on ammonium nitrate from Ukraine is sufficient evidence of a history 
of injurious dumping. Accordingly, there is no need to examine importer 
knowledge.
    In addressing the second criterion, i.e., 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. Section 351.206(i) of the Department's regulations also 
provides, however, that if the Department finds that importers, or 
exporters or producers, had reason to believe, at some time prior to 
the beginning of the proceeding, that a proceeding was likely, the 
Department may consider a base and comparison period of not less than 
three months from that earlier time.
    In this case, the petitioner has argued that importers, exporters, 
or producers of ammonium nitrate had reason to believe that an 
antidumping proceeding was likely as early as January 2000, well before 
the filing of the petition, based on the increase in imports of 
ammonium nitrate from Ukraine and the corresponding decrease in 
ammonium nitrate imports from Russia following the January 2000 
preliminary determination in the investigation of ammonium nitrate from 
Russia. See Notice of Preliminary Determination of Sales at Less Than 
Fair Value; Solid Fertilizer Grade Ammonium Nitrate from the Russian 
Federation, 65 FR 1139 (January 7, 2000) and Notice of Final 
Determination of Sales at Less Than Fair Value; Solid Fertilizer Grade 
Ammonium Nitrate from the Russian Federation, 65 FR 42669 (July 11, 
2000) (``Ammonium Nitrate from Russia''). Thus, the petitioner contends 
that, as a result of the shift of imports of ammonium nitrate from 
Russia to Ukraine, importers, exporters, or producers of ammonium 
nitrate would have been aware that an investigation of ammonium nitrate 
from Ukraine would likely be forthcoming. Alternately, the petitioner 
argues that two press reports relating to Ammonium Nitrate from Russia 
published in May and August 2000 in Green Markets, a fertilizer 
industry publication, are sufficient evidence to impute knowledge that 
importers, or exporters or producers, had reason to believe, at some 
time prior to the beginning of the proceeding, that a proceeding was 
likely.
    In order to determine whether the facts of this case showed that 
importers, exporters, or producers had advance knowledge that a case 
was likely to be filed, we examined whether conditions in the industry 
or published reports and statements provided a basis for inferring 
knowledge that an antidumping investigation of ammonium nitrate from 
Ukraine was likely. As noted above, the petitioner provided two 
articles relating to the Ammonium Nitrate from Russia investigation 
from May and August 2000. The May 2000 article did not specifically 
mention imports of ammonium nitrate from Ukraine; however, the August 
2000 article did

[[Page 13292]]

state that the U.S. industry was closely monitoring imports of this 
product from Ukraine. The petitioner did not provide any published 
reports or information indicating that knowledge of a possible 
antidumping investigation of ammonium nitrate from Ukraine was publicly 
available as of January 2000. We did a search of Lexis-Nexis and the 
Internet to see if there were any other articles or information 
pertaining to ammonium nitrate from Ukraine. Our research revealed 
nothing prior to the August 2000 report.
    Therefore, we find no evidence that importers, or exporters or 
producers, had reason to believe that a proceeding on ammonium nitrate 
from Ukraine was likely as of January or May 2000. However, we find 
that the press report in August 2000 was sufficient to establish that, 
by early August 2000, importers, exporters, or producers knew, or 
should have known, that a proceeding was likely. Accordingly, it is 
appropriate to utilize a comparison period starting in August 2000. 
Therefore, to determine whether imports of subject merchandise have 
been massive over a relatively short period, we compared shipment data 
for Stirol and all other Ukrainian importers covered by the Ukraine-
wide rate during the comparison period, August 2000 through November 
2000, to shipments during the base period, April 2000 to July 2000.
    Based on our analysis of the data from the above base and 
comparison periods, we found that shipments made by both Stirol and all 
other Ukrainian producer/exporters during the POI increased by more 
than 15%.
    Because of the alleged seasonality of ammonium nitrate shipments 
(see Ammonium Nitrate from Russia), we examined whether this observed 
increase was due to a seasonal surge. We compared the reported shipment 
data for Stirol and the data for all other Ukrainian producers/
exporters to relevant historical data on all ammonium nitrate shipments 
to the United States (with the exception of imports from Russia and 
Ukraine). We used total imports in to the United States of ammonium 
nitrate to test for seasonality rather than historical shipment 
patterns by Ukrainian producers/exporters because Ukraine only recently 
entered the U.S. market. Hence, historical data for Ukraine was not 
available.
    We compared the percent change from the base to the comparison 
period to the historical percent change of all sales of ammonium 
nitrate made to the United States for the same base and comparison 
periods from 1996 through 1999, excluding data from Ukraine and Russia. 
This data shows that, during these same base and comparison periods in 
the years from 1996 through 1999, there was a small percentage increase 
relative to the increase in shipments for Stirol and all other 
Ukrainian producers/exporters in 2000. Thus, the increase in shipments 
by Stirol and all other Ukrainian producers/exporters does not appear 
to be explained by seasonality of shipments.
    Therefore, we preliminarily determine that the increases in imports 
for Stirol and all other Ukrainian producers/exporters were massive 
over a relatively short period. Having met both requirements for an 
affirmative determination of critical circumstances, we preliminarily 
determine that critical circumstances exist for both Stirol and the 
Ukraine-wide entity. We will make a final determination concerning 
critical circumstances when we make our final determination of this 
investigation.

Verification

    As provided in section 782(i) of the Act, we will verify all 
information relied upon in making our final determination.

Suspension of Liquidation

    In accordance with section 733(d)(2) of the Act, we are directing 
the Customs Service to suspend liquidation of all imports of subject 
merchandise from Ukraine entered, or withdrawn from warehouse, for 
consumption on or after the date of publication of this notice in the 
Federal Register. In addition, we are directing Customs to suspend 
liquidation of any unliquidated entries of subject merchandise entered, 
or withdrawn from warehouse, for consumption on or after the date which 
is 90 days prior to the date on which this notice is published in the 
Federal Register. We will instruct the Customs Service to require a 
cash deposit or the posting of a bond equal to the weighted-average 
amount by which the NV exceeds the EP or CEP, as appropriate, as 
indicated in the chart below. These suspension of liquidation 
instructions will remain in effect until further notice.

------------------------------------------------------------------------
                                                              Weighted-
                                                               average
                   Exporter/manufacturer                        margin
                                                              percentage
------------------------------------------------------------------------
J.S.C. ``Concern'' Stirol..................................       113.38
Ukraine-wide rate..........................................       113.38
------------------------------------------------------------------------

    The Ukraine-wide rate applies to all entries of the subject 
merchandise except for entries from exporters/factories that are 
identified individually above.

ITC Notification

    In accordance with section 733(f) of the Act, we have notified the 
ITC of our determination. If our final determination is affirmative, 
the ITC will determine before the later of 150 days after the date of 
this preliminary determination or 45 days after our final determination 
whether these imports are materially injuring, or threaten material 
injury to, the U.S. industry.

Public Comment

    Case briefs or other written comments in six copies must be 
submitted to the Assistant Secretary for Import Administration no later 
than April 20, 2001, and rebuttal briefs no later than April 25, 2001. 
A list of authorities used and an executive summary of issues should 
accompany any briefs submitted to the Department. Such summary should 
be limited to five pages total, including footnotes. In accordance with 
section 774 of the Act, we will hold a public hearing, if requested, to 
afford interested parties an opportunity to comment on arguments raised 
in case or rebuttal briefs. Tentatively, the hearing will be held on 
April 27, 2001, at the U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW., Washington, DC 20230. Parties should confirm 
by telephone the time, date, and place of the hearing 48 hours before 
the scheduled time.
    Interested parties who wish to request a hearing, or to participate 
if one is requested, must submit a written request to the Assistant 
Secretary for Import Administration, U.S. Department of Commerce, Room 
1870, within 30 days of the publication of this notice. Requests should 
contain: (1) The party's name, address, and telephone number; (2) the 
number of participants; and (3) a list of the issues to be discussed. 
Oral presentations will be limited to issues raised in the briefs. If 
this investigation proceeds normally, we will make our final 
determination not later than 105 days after the date of the preliminary 
determination.
    This determination is issued and published in accordance with 
sections 733(d) and 777(i)(1) of the Act. Richard W. Moreland is 
temporarily fulfilling the duties of the Assistant Secretary for Import 
Administration.

    Dated: February 23, 2001.
Richard W. Moreland,
Deputy Assistant Secretary, Import Administration.
[FR Doc. 01-5156 Filed 3-2-01; 8:45 am]
BILLING CODE 3510-DS-P