[Federal Register Volume 67, Number 44 (Wednesday, March 6, 2002)]
[Notices]
[Pages 10128-10133]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-5347]



[[Page 10128]]

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DEPARTMENT OF COMMERCE

International Trade Administration

[A-570-851]


Certain Preserved Mushrooms From the People's Republic of China: 
Preliminary Results of New Shipper Review and Preliminary Results and 
Partial Rescission of Second Antidumping Duty Administrative Review

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

ACTION: Notice of preliminary results of new shipper review and 
preliminary results and partial rescission of second antidumping duty 
administrative review.

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SUMMARY: The Department of Commerce is currently conducting the new 
shipper review and second administrative review of the antidumping duty 
order on certain preserved mushrooms from the People's Republic of 
China covering the period February 1, 2000, through January 31, 2001. 
The new shipper review covers two exporters and the second 
administrative review covers three exporters. We have preliminarily 
determined that sales have been made below normal value with respect to 
three out of these five exporters. If these preliminary results are 
adopted in our final results of this review, we will instruct the U.S. 
Customs Service to assess antidumping duties on entries of subject 
merchandise during the period of review, for which the importer-
specific assessment rates are above de minimis.
    Interested parties are invited to comment on these preliminary 
results. We will issue the final results no later than 120 days from 
the date of publication of this notice.

EFFECTIVE DATE: March 6, 2002.

FOR FURTHER INFORMATION CONTACT: Brian Smith or Terre Keaton, Import 
Administration, International Trade Administration, U.S. Department of 
Commerce, 14th Street and Constitution Avenue, NW., Washington, DC 
20230; telephone: (202) 482-1766 or (202) 482-1280, respectively.
    The Applicable Statute: Unless otherwise indicated, all citations 
to the Tariff Act of 1930, as 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. In 
addition, unless otherwise indicated, all citations to the U.S. 
Department of Commerce's (``the Department's'') regulations are to 19 
CFR part 351 (2001).

SUPPLEMENTARY INFORMATION:

Background

    On February 19, 1999, the Department published in the Federal 
Register an amended final determination and antidumping duty order on 
certain preserved mushrooms from the People's Republic of China 
(``PRC'') (64 FR 8308).
    On February 14, 2001, the Department published a notice advising of 
the opportunity to request an administrative review of the antidumping 
duty order on certain preserved mushrooms from the PRC (66 FR 10269). 
On February 26, 2001, the Department received a timely request from 
Gerber Food (Yunnan) Co., Ltd. (``Gerber'') for an administrative 
review pursuant to 19 CFR 351.213(b).
    On February 27, 2001, the Department received timely requests from 
Shantou Hongda Industrial General Corporation (``Shantou Hongda'') and 
Shenxian Dongxing Foods Co., Ltd. (``Shenxian Dongxing'') for a new 
shipper review of this antidumping duty order in accordance with 19 CFR 
351.214(c).
    On February 28, 2001, the petitioner \1\ requested an 
administrative review pursuant to 19 CFR 351.213(b) of 28 companies \2\ 
which it claimed were producers and/or exporters of the subject 
merchandise. Three of these 28 companies also requested a review.
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    \1\ The petitioner is the Coalition for Fair Preserved Mushroom 
Trade which includes the American Mushroom Institute and the 
following domestic companies: L.K. Bowman, Inc., Modern Mushroom 
Farms, Inc., Monterey Mushrooms, Inc., Mount Laurel Canning Corp., 
Mushrooms Canning Company, Southwood Farms, Sunny Dell Foods, Inc., 
and United Canning Corp.
    \2\ The petitioner request included the following companies: (1) 
Tak Fat Trading Co. (``Tak Fat''); (2) Mei Wei Food Industry Co., 
Ltd. (``Mei Wei''); (3) China Processed Food Import & Export Company 
(``China Processed''); (4) Fujian Yu Xing Fruits and Vegetables 
Foodstuffs Co., Ltd. (``Fujian Yu Xing''); (5) Raoping Xingyu Foods 
Co., Ltd. (``Raoping Xingyu''); (6) Raoping Yucun Canned Foods 
Factory (``Raoping Yucun''); (7) Shantou Hongda; (8) Shenxiang 
Dongxing; (9) Gerber; (10) Green Fresh Foods (Zhangzhou) Co., Ltd. 
(``Green Fresh''); (11) Zhang Zhou Longhai Lubao Food Co., Ltd. 
(``Zhang Zhou Longhai''); (12) Citic Ningbo Import & Export Corp., 
Ltd. (``Citic Ningbo''); (13) Shanghai Foodstuffs Import & Export 
Corporation (``Shanghai Foodstuffs''); (14) Zhejiang Cereals, Oils & 
Foodstuffs Import & Export Co., Ltd. (``Zhejiang Cereals''); (15) 
China Ningbo Canned Food Factory (``China Ningbo''); (16) Longhai 
Senox Limited (``Longhai Senox''); (17) Beiliu Canned Food Factory 
(``Beiliu Canned''); (18) Fujian Cereals, Oils & Foodstuffs Import & 
Export (Group) Corp. (``Fujian Cereals''); (19) Putian Cannery 
(``Putian''); (20) General Canned Food Factory of Zhangzhou; (21) 
Jiangsu Cereals, Oils & Foodstuffs Import & Export Group Corp. 
(``Jiangsu Cereals''); (22) Canned Goods Company of Raoping; (23) 
Shenzhen Cofry Cereals, Oils & Foodstuffs, Co., Ltd. (``Shenzhen 
Cofry''); (24) Xiamen Gulong Import & Export Co., Ltd. (``Xiamen 
Jiahua''); (25) Dongya Food Co., Ltd. (``Dongya''); and (26) Xiamen 
Jiahua Import & Export Trading Co., Ltd. (``Xiamen Jiahua'').
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    On March 12, 2001, both Shantou Hongda and Shenxian Dongxing agreed 
to waive the time limits applicable to the new shipper review and to 
permit the Department to conduct the new shipper review concurrently 
with the administrative review.
    On March 16, 2001, the Department initiated an administrative 
review covering the companies listed in the petitioner's February 28, 
2001, request (see Initiation of Antidumping and Countervailing Duty 
Administrative Reviews, 66 FR 16037, 16039, (May 23, 2001).
    On March 26, 2001, the Department initiated a new shipper review of 
Shantou Hongda and Shenxian Dongxing (see Certain Preserved Mushrooms 
from the People's Republic of China: Initiation of New Shipper 
Antidumping Duty Review, 66 FR 17406 (May 30, 2001).
    On March 30, 2001, we issued a questionnaire to each PRC company 
listed in the above-referenced initiation notices. On April 3 and 4, 
and May 2, 2001, Shanghai Foodstuffs, Fujian Cereals, and the Canned 
Goods Company of Raoping each stated for the record that they did not 
make shipments of the subject merchandise to the U.S. market during the 
POR.
    On April 3, and 4, 2001, the Department was notified by Federal 
Express that Federal Express was unable to deliver the Department's 
March 30, 2001, antidumping duty questionnaire to the following 
companies based on the mailing address provided: (1) Citic Ningbo; (2) 
China Ningbo; (3) Longhai Senox; (4) Beiliu Canned; (5) Shenzhen Cofry; 
(6) Jiangsu Cereals; (7) General Canned Food Factory of Zhangzhou; and 
(8) Dongya (see April 18, 2001, Memorandum to the File from Case 
Analyst for further details).
    From May 5, through 29, 2001, China Processed, Gerber, Raoping 
Xingyu (and its supplier Raoping Yucun), Shantou Hongda, and Shenxian 
Dongxing submitted their responses to the Department's antidumping duty 
questionnaire.
    From June 8 through 27, 2001, the petitioner submitted comments on 
questionnaire responses provided by Raoping Xingyu and Gerber, and 
comments on the Section A responses provided by Shantou Hongda and 
Shenxian Dongxing.
    On June 20, 2001, the petitioner withdrew its request for an 
administrative review of China Processed, Fujian Yu Xing, and Xiamen 
Jiahua. Also, the petitioner requested an extension of time until 
August 9, 2001,

[[Page 10129]]

to submit factual information in this case, which the Department 
granted on June 22, 2001.
    On July 3, 2001, the Department provided the parties an opportunity 
to submit publicly available information for consideration in these 
preliminary results.
    On July 19, 2001, the Department published in the Federal Register 
a notice of postponement of the preliminary results until no later than 
February 28, 2002 (66 FR 37640).
    On August 30, and 31, 2001, Gerber and the petitioner submitted 
publicly available information for use in valuing the factors of 
production. On September 7, 2001, Gerber provided rebuttal publicly 
available information and comments.
    On September 28, 2001, the petitioner submitted comments on the 
Section C and D responses provided by Shantou Hongda and Shenxian 
Dongxing. On October 3, 2001, the Department issued supplemental 
questionnaires to Gerber, Raoping Xingyu, Shantou Hongda, and Shenxian 
Dongxing.
    In November 2001, the respondents submitted their responses to the 
Department's supplemental questionnaires. In November and December 
2001, the petitioner submitted additional comments on the supplemental 
responses provided by each respondent.
    In December 2001, the Department issued each respondent a second 
supplemental questionnaire. In January and February 2002, the 
respondents submitted their responses to these questionnaires. In 
February 2002, the petitioner submitted additional comments on the 
responses filed by all four respondents. Two respondents, Gerber and 
Raoping Xingyu, submitted clarifications to items raised by the 
petitioner in its February 2002 filings. Based on the comments 
submitted, which were not received in time to be fully analyzed for the 
preliminary results, we intend to issue supplemental questionnaires 
soliciting certain additional information or clarification from the 
respondents, as appropriate, after the preliminary results, for 
consideration in the final results.

Scope of Order

    The products covered by this order are certain preserved mushrooms 
whether imported whole, sliced, diced, or as stems and pieces. The 
preserved mushrooms covered under this order are the species Agaricus 
bisporus and Agaricus bitorquis. ``Preserved mushrooms'' refer to 
mushrooms that have been prepared or preserved by cleaning, blanching, 
and sometimes slicing or cutting. These mushrooms are then packed and 
heated in containers including but not limited to cans or glass jars in 
a suitable liquid medium, including but not limited to water, brine, 
butter or butter sauce. Preserved mushrooms may be imported whole, 
sliced, diced, or as stems and pieces. Included within the scope of 
this order are ``brined'' mushrooms, which are presalted and packed in 
a heavy salt solution to provisionally preserve them for further 
processing.
    Excluded from the scope of this order are the following: (1) All 
other species of mushroom, including straw mushrooms; (2) all fresh and 
chilled mushrooms, including ``refrigerated'' or ``quick blanched 
mushrooms''; (3) dried mushrooms; (4) frozen mushrooms; and (5) 
``marinated,'' ``acidified'' or ``pickled'' mushrooms, which are 
prepared or preserved by means of vinegar or acetic acid, but may 
contain oil or other additives.\3\
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    \3\ On June 19, 2000, the Department affirmed that 
``marinated,'' ``acidified,'' or ``pickled'' mushrooms containing 
less than 0.5 percent acetic acid are within the scope of the 
antidumping duty order. See ``Recommendation Memorandum--Final 
Ruling of Request by Tak Fat, et al. for Exclusion of Certain 
Marinated, Acidified Mushrooms from the Scope of the Antidumping 
Duty Order on Certain Preserved Mushrooms from the People's Republic 
of China,'' dated June 19, 2000.
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    The merchandise subject to this order is currently classifiable 
under subheadings 2003.10.0027, 2003.10.0031, 2003.10.0037, 
2003.10.0043, 2003.10.0047, 2003.10.0053, and 0711.90.4000 of the 
Harmonized Tariff Schedule of the United States \4\ (``HTSUS''). 
Although the HTSUS subheadings are provided for convenience and customs 
purposes, the written description of the scope of this order is 
dispositive.
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    \4\ As of January 1, 2002, the HTS codes are as follows: 
2003.10.0127, 2003.10.0131, 2003.10.0137, 2003.10.0143, 
2003.10.0147, 2003.10.0153, and 0711.51.0000.
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Period of Reviews

    The reviews (``POR'') cover the period February 1, 2000, through 
January 31, 2001.

Partial Rescission of Administrative Review

    We are preliminarily rescinding this review with respect to China 
Processed, Fujian Yu Xing, and Xiamen Jiahua because the petitioner 
withdrew its request for review and no other interested party requested 
a review of these companies.
    Furthermore, we are preliminarily rescinding this review with 
respect to Shanghai Foodstuffs, Fujian Cereals, and the Canned Goods 
Company of Raoping, each of which reported that it made no shipments of 
subject merchandise during this POR, based on the results of our 
examination of shipment data furnished by the Customs Service. Because 
the shipment data we examined did not show U.S. entries of the subject 
merchandise during the POR from Shanghai Foodstuffs, Fujian Cereals or 
the Canned Goods Company of Raoping, we pursued no further this inquiry 
with the Customs Service.
    Moreover, the shipment data we examined did not show U.S. entries 
of the subject merchandise during the POR from Tak Fat, Mei Wei, Zhang 
Zhou Longhai, Citic Ningbo, Zhejiang Cereals, China Ningbo, Longhai 
Senox, Beiliu Canned, Putian, General Canned Food Factory of Zhangzhou, 
Jiangsu Cereals, Shenzhen Cofry, Xiamen Gulong, and Dongya. Therefore, 
we are preliminarily rescinding this review with respect to these 
companies as well.
    However, the shipment data we examined did show U.S. entries of the 
subject merchandise during the POR from Green Fresh.

Facts Available

    Section 776(a) of the Act provides that, if an interested party 
withholds information that has been requested by the Department, fails 
to provide such information in a timely manner or in the form or manner 
requested (subject to sections 782(c)(1) and 782(e) of the Act), 
significantly impedes a proceeding under the antidumping statute, or 
provides information which cannot be verified, the Department shall 
use, subject to section 782(d) of the Act, facts otherwise available in 
reaching the applicable determination. Because Green Fresh shipped 
subject merchandise to the United States during the POR, but failed to 
respond to the Department's antidumping duty questionnaire, we find 
that the use of facts available is warranted in this segment of the 
proceeding with respect to Green Fresh.
    In addition, section 776(b) of the Act provides that, if the 
Department finds that an interested party ``has failed to cooperate by 
not acting to the best of its ability to comply with a request for 
information,'' the Department may use information that is adverse to 
the interests of that party as facts otherwise available. Section 
776(b) of the Act further provides that, in selecting from among the 
facts available, the Department may employ adverse inferences against 
an interested party if that party failed to cooperate by not acting to 
the best of its ability to comply with requests for information. See 
also ``Statement of Administrative Action''

[[Page 10130]]

accompanying the URAA, H.R. Rep. No. 103-316, 870 (1994) (``SAA'').
    As stated above, U.S. Customs data indicates that Green Fresh made 
shipments of the subject merchandise to the U.S. market during the POR. 
However, it failed to respond to the Department's March 30, 2001, 
antidumping duty questionnaire. Further, Green Fresh has participated 
in a prior review and yet provided the Department with no explanation 
as to why it could not respond in this review. Therefore, Green Fresh 
failed to cooperate to the best of its ability in this segment of the 
proceeding. As a result, pursuant to section 776(b) of the Act, we have 
made the adverse inference that Green Fresh no longer qualifies for a 
separate rate. Thus, we have treated it as part of the non-market 
economy (``NME'') entity, which is subject to the PRC-wide rate.

Separate Rates

    In proceedings involving NME countries, the Department begins with 
a rebuttable presumption that all companies within the country are 
subject to government control and thus should be assessed a single 
antidumping duty deposit rate (i.e., a PRC-wide rate). One respondent 
in these reviews, Gerber, is wholly foreign-owned by persons located 
outside the PRC. Thus, for Gerber, because we have no evidence 
indicating that it is under the control of the PRC government, a 
separate rates analysis is not necessary to determine whether it is 
independent from government control (see Brake Rotors from the People's 
Republic of China: Final Results and Partial Rescission of Fifth New 
Shipper Review, 66 FR 44331 (August 23, 2001) (which cites to Brake 
Rotors from the People's Republic of China: Preliminary Results and 
Partial Rescission of the Fifth New Shipper Review and Rescission of 
the Third Antidumping Duty Administrative Review, 66 FR 29080 (May 29, 
2001) (where the respondent was wholly-owned by a U.S. registered 
company); (Brake Rotors from the People's Republic of China: Final 
Results and Partial Rescission of Fourth New Shipper Review and 
Rescission of Third Antidumping Duty Administrative Review, 66 FR 27063 
(May 16, 2001) (which cites to Brake Rotors from the People's Republic 
of China: Preliminary Results and Partial Rescission of the Fourth New 
Shipper Review and Rescission of the Third Antidumping Duty 
Administrative Review, 66 FR 1303, 1306 (January 8, 2001) (where the 
respondent was wholly-foreign owned by a company located in Hong Kong); 
and Notice of Final Determination of Sales at Less Than Fair Value: 
Creatine Monohydrate from the People's Republic of China, 64 FR 71104, 
71105 (December 20, 1999) (where the respondent was wholly-owned by 
persons located in Hong Kong)).
    Two respondents, Raoping Xingyu and Shenxian Dongxing, are joint 
ventures. The other respondent, Shantou Hongda, is owned by all of the 
people. Thus, a separate-rates analysis is necessary to determine 
whether each of these three exporters is independent from government 
control (see Notice of Final Determination of Sales at Less Than Fair 
Value: Bicycles From the People's Republic of China (``Bicycles''), 61 
FR 56570 (April 30, 1996)). To establish whether a firm is sufficiently 
independent in its export activities from government control to be 
entitled to a separate rate, the Department utilizes a test arising 
from the Final Determination of Sales at Less Than Fair Value: 
Sparklers from the People's Republic of China, 56 FR 20588 (May 6, 
1991) (``Sparklers''), and amplified in the Final Determination of 
Sales at Less Than Fair Value: Silicon Carbide from the People's 
Republic of China, 59 FR 22585 (May 2, 1994) (``Silicon Carbide''). 
Under the separate-rates criteria, the Department assigns separate 
rates in NME cases only if the respondent can demonstrate the absence 
of both de jure and de facto governmental control over export 
activities.

1. De Jure Control

    Raoping Xingyu, Shantou Hongda, and Shenxian Dongxing have placed 
on the administrative record the following document to demonstrate 
absence of de jure control: the 1994 ``Foreign Trade Law of the 
People's Republic of China.'' In other cases involving products from 
the PRC, respondents have submitted the following additional documents 
to demonstrate absence of de jure control: the Law of the People's 
Republic of China on Industrial Enterprises Owned by the Whole 
People,'' adopted on April 13, 1988 (``the Industrial Enterprises 
Law''); ``The Enterprise Legal Person Registration Administrative 
Regulations,'' promulgated on June 13, 1988; the 1990 ``Regulation 
Governing Rural Collectively-Owned Enterprises of PRC;'' and the 1992 
``Regulations for Transformation of Operational Mechanisms of State-
Owned Industrial Enterprises'' (``Business Operation Provisions'') (see 
February 28, 2002, memorandum to the file which places the above-
referenced laws on the record of this proceeding).
    As in prior cases, we have analyzed these laws and have found them 
to establish sufficiently an absence of de jure control of joint 
ventures and companies owned by ``all of the people.'' See, e.g., Final 
Determination of Sales at Less than Fair Value: Furfuryl Alcohol from 
the People's Republic of China (``Furfuryl Alcohol'') 60 FR 22544 (May 
8, 1995), and Preliminary Determination of Sales at Less Than Fair 
Value: Certain Partial-Extension Steel Drawer Slides with Rollers from 
the People's Republic of China, 60 FR 29571 (June 5, 1995).

2. De Facto Control

    As stated in previous cases, there is some evidence that certain 
enactments of the PRC central government have not been implemented 
uniformly among different sectors and/or jurisdictions in the PRC. See 
Silicon Carbide and Furfuryl Alcohol. Therefore, the Department has 
determined that an analysis of de facto control is critical in 
determining whether the respondents are, in fact, subject to a degree 
of governmental control which would preclude the Department from 
assigning separate rates.
    The Department typically considers four factors in evaluating 
whether each 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 management; and (4) 
whether the respondent retains the proceeds of its export sales and 
makes independent decisions regarding the disposition of profits or 
financing of losses (see Silicon Carbide and Furfuryl Alcohol).
    Raoping Xingyu, Shantou Hongda, and Shenxian Dongxing each has 
asserted the following: (1) Each establishes its own export prices; (2) 
each negotiates contracts without guidance from any governmental 
entities or organizations; (3) each makes its own personnel decisions; 
and (4) each retains the proceeds of its export sales, uses profits 
according to its business needs, and has the authority to sell its 
assets and to obtain loans. Additionally, each respondent's 
questionnaire responses indicate that its pricing during the POR does 
not suggest coordination among exporters. This information supports a 
preliminary finding that there is de facto absence of governmental 
control of the export functions performed by Raoping Xingyu, Shantou 
Hongda, and Shenxian

[[Page 10131]]

Dongxing. See Pure Magnesium from the People's Republic of China: 
Preliminary Results of Antidumping Duty New Shipper Administrative 
Review, 62 FR 55215 (October 23, 1997). Consequently, we have 
preliminarily determined that each respondent has met the criteria for 
the application of separate rates.

Fair Value Comparisons

    To determine whether sales of the subject merchandise by each 
respondent to the United States were made at LTFV, we compared the 
export price to the normal value, as described in the ``Export Price'' 
and ``Normal Value'' sections of this notice, below.

Export Price

    We used export price methodology in accordance with section 772(a) 
of the Act because the subject merchandise was sold by the exporter 
directly to an unaffiliated customer in the United States prior to 
importation and constructed export price was not otherwise indicated. 
We made the following company-specific adjustments as follows:

A. Gerber

    For Gerber, we calculated export price based on packed, FOB foreign 
port prices to the first unaffiliated purchaser in the United States. 
Where appropriate, we made deductions from the starting price (gross 
unit price) for foreign inland freight and foreign brokerage and 
handling charges in the PRC in accordance with section 772(c) of the 
Act. Because foreign inland freight and foreign brokerage and handling 
fees were provided by PRC service providers or paid for in a renminbi, 
we based those charges on surrogate rates from India (see ``Surrogate 
Country'' section below for further discussion of our surrogate country 
selection). To value foreign inland trucking charges, we used a 
November 1999 average truck freight value based on price quotes from 
Indian trucking companies. We most recently used this rate in a new 
shipper review of brake rotors from the PRC (see Brake Rotors from the 
People's Republic of China: Final Results and Partial Rescission of 
Fifth Antidumping Duty New Shipper Review, 66 FR 44331 (August 23, 
2001) (which cites to the ``Issues and Decision Memorandum'' from 
Richard W. Moreland, Deputy Assistant Secretary for Import 
Administration, to Faryar Shirzad, Assistant Secretary for Import 
Administration, dated August 17, 2001) (``Brake Rotors New Shipper 
Review'')). To value foreign brokerage and handling expenses, we relied 
on public information reported in the 1997-1998 antidumping duty new 
shipper review of stainless steel wire rod from India (see also Brake 
Rotors Fifth New Shipper Review).

B. Raoping Xingyu

    For Raoping Xingyu, we calculated export price based on packed, C&F 
foreign port prices to the first unaffiliated purchaser in the United 
States. Where appropriate, we made deductions from the starting price 
(gross unit price) for foreign inland freight and international freight 
(which included ocean freight and foreign brokerage and handling 
expenses) in accordance with section 772(c) of the Act. Because foreign 
inland freight was provided by PRC service providers or paid for in 
renminbi, we based this charge on surrogate rates from India (see 
discussion above for further details). Because international freight 
for all U.S. sales was provided by a market-economy service provider 
and paid for in U.S. dollars, we relied on the amounts reported for 
this charge by Raoping Xingyu.

C. Shantou Hongda

    For Shantou Hongda, we calculated export price based on packed, FOB 
foreign port prices to the first unaffiliated purchaser in the United 
States. Where appropriate, we made deductions from the starting price 
(gross unit price) for foreign inland freight and brokerage and 
handling expenses in accordance with section 772(c) of the Act. Because 
foreign inland freight and brokerage and handling expenses were 
provided by PRC service providers or paid for in renminbi, we based 
these charges on surrogate rates from India (see discussion above for 
further details).

D. Shenxian Dongxing

    For Shenxian Dongxing, we calculated export price based on packed, 
C&F foreign port prices to the first unaffiliated purchaser in the 
United States. Where appropriate, we made deductions from the starting 
price (gross unit price) for foreign inland freight in accordance with 
section 772(c) of the Act. Because foreign inland freight was provided 
by PRC service providers or paid for in renminbi, we based this charge 
on surrogate rates from India (see discussion above for further 
details). Because Shenxian Dongxing separately invoiced the U.S. 
customer for the total amount of ocean freight and foreign brokerage 
and handling expenses incurred for its sales, we did not deduct an 
amount for these expenses from the starting price.

Normal Value

A. Non-Market Economy Status

    In every case conducted by the Department involving the PRC, the 
PRC has been treated as a NME country. Pursuant to section 
771(18)(C)(i) of the Act, any determination that a foreign country is a 
NME country shall remain in effect until revoked by the administering 
authority (see Notice of Preliminary Results of Antidumping Duty 
Administrative Review and Preliminary Partial Rescission of Antidumping 
Duty Administrative Review: Freshwater Crawfish Tail Meat From the 
People's Republic of China, 66 FR 52100, 52103 (October 12, 2001). None 
of the parties to this proceeding has contested such treatment. 
Accordingly, we calculated normal value in accordance with section 
773(c) of the Act, which applies to NME countries.

B. Surrogate Country

    Section 773(c)(4) of the Act requires the Department to value a 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 country, and (2) are 
significant producers of comparable merchandise. India is among the 
countries comparable to the PRC in terms of overall economic 
development (see May 8, 2001, Memorandum from the Office of Policy to 
the Case Analyst). In addition, based on publicly available information 
placed on the record, India is a significant producer of the subject 
merchandise. Accordingly, we considered India the primary surrogate 
country for purposes of valuing the factors of production because it 
meets the Department's criteria for surrogate country selection.

C. Factors of Production

    In accordance with section 773(c) of the Act, we calculated normal 
value based on the factors of production which included, but were not 
limited to: (A) Hours of labor required; (B) quantities of raw 
materials employed; (C) amounts of energy and other utilities consumed; 
and (D) representative capital costs, including depreciation. We used 
the factors reported by the four respondents which produced the subject 
merchandise they exported to the United States during the POR. To 
calculate normal value, we multiplied the reported unit factor 
quantities by publicly available Indian values.
    One respondent, Raoping Xingyu, reported its factors of production 
on a can size-specific basis. For the

[[Page 10132]]

preliminary results, we have accepted its method of reporting its 
factors since there is no information on the record which indicates 
that it maintains records which could have enable it to report its 
factors on a more specific basis (i.e., mushroom style basis) .\5\ 
However, for certain U.S. sales, Raoping Xingyu did not indicate which 
reported factors were associated with those U.S. sales. For the 
preliminary results, we have assigned factors to those U.S. sales based 
on data contained in Raoping Xingyu's response for the same can size. 
In addition, although Raoping Xingyu reported separate market-economy 
prices for certain inputs (i.e., lids and cans), it reported the usage 
of both inputs as one factor. Because, we have no way of separating 
this data, this reporting method prevents us from using the reported 
market-economy prices to value this input in our analysis. Therefore, 
for the preliminary results, we have used a surrogate value for Raoping 
Xingyu's reported factors for this input. We intend to issue Raoping 
Xingyu another supplemental questionnaire in order to address these 
matters prior to the final results.
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    \5\ Buttons, whole, and slices are examples of different 
mushroom styles.
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    The Department's selection of the surrogate values applied in this 
determination was based on the quality, specificity, and 
contemporaneity of the data. As appropriate, we adjusted input prices 
to make them delivered prices. For those values not contemporaneous 
with the POR and quoted in a foreign currency or in U.S. dollars, we 
adjusted for inflation using wholesale price indices published in the 
International Monetary Fund's International Financial Statistics.
    To value fresh mushrooms, we used an average price based on data 
from February-July 2000 as contained in the Economic Times of India and 
data contained in the 1999-2000 financial reports Agro Dutch Foods Ltd. 
(``Agro Dutch'') and Premier Explosives Ltd. (``Premier''). For those 
respondents which purchased brined mushrooms, we also used the fresh 
mushroom price to value brined mushrooms because we were unable to 
obtain publicly available information which contained a price for 
brined mushrooms.
    To value spawn and manure, we used an average price based on data 
contained in the 1999-2000 financial reports of Agro Dutch and Flex 
Foods Ltd. (``Flex Foods'') (i.e., two Indian producers of the subject 
merchandise). To value straw, we used an average price based on data 
contained in the 1999-2000 financial reports of Agro Dutch, Flex Foods, 
and Premier. To value grain and phosphate super, we used price data 
contained in Flex Foods' 1999-2000 financial report because no other 
data or data which was as contemporaneous was available from the other 
financial reports on the record. To value tin cans and lids, we used 
price data contained in Agro Dutch's 1999-2000 financial report because 
no such data was available from the other financial reports on the 
record. To value salt, we used price data contained in the 1998-1999 
financial report of Weikfield Agro Products Ltd. (i.e., another Indian 
producer of the subject merchandise) because no such data was available 
from the other financial reports on the record. To value citric acid, 
boric acid, magnesium sulfate, calcium carbonate, and formaldehyde, we 
used an average price based on April 2000-February 2001 data contained 
in Monthly Statistics of the Foreign Trade of India (``Monthly 
Statistics'') and February 2000-January 2001 data contained in Chemical 
Weekly. For those prices obtained from Chemical Weekly, where 
appropriate, we also deducted an amount for excise taxes based on the 
methodology applied to values from the same source in a prior review 
involving the subject merchandise from the PRC (see page 4 of the May 
31, 2001, Preliminary Results Valuation Memorandum for the Preliminary 
Results of New Shipper Review: Certain Preserved Mushrooms from the 
People's Republic of China, 66 FR 30695 (June 7, 2001) (which has been 
placed on the record of this proceeding)). To value calcium phosphate, 
we used a December 1999 value from Chemical Market Reporter. Since the 
value from Chemical Market Reporter was in U.S. dollars and 
contemporaneous with the POR, we did not inflate this value.
    To value gypsum, cotton, tin plate, copper conducting wire, copper, 
wire scrap, can and lid scrap, and tin plate scrap, and coal, we used 
April 2000-February 2001 average import values from Monthly Statistics. 
To value furnace oil, we used price data contained in Hindustan Lever 
Limited's (``Hindustan's'') 1999-2000 financial report because no other 
data was available from the other financial reports on the record. We 
also added an amount for loading and additional transportation charges 
associated with delivering coal to the factory based on June 1999 
Indian price data contained in the periodical Business Line.
    We did not value water separately because, consistent with our 
methodology used in prior reviews of the subject merchandise, we 
believe that the costs for water are included as factory overhead in 
the Indian financial statements used to calculate factory overhead, 
selling, general, and administrative (``SG&A'') expenses, and profit 
(see Preliminary Results of New Shipper Review: Certain Preserved 
Mushrooms from the People's Republic of China, 66 FR 30695, 30697 (June 
7, 2001)).
    To value electricity, we used an average rate based on data 
contained in the financial statements of three Indian producers of the 
subject merchandise.
    We valued labor based on a regression-based wage rate, in 
accordance with 19 CFR 351.408(c)(3).
    To value factory overhead and SG&A expenses, we used the audited 
1999-2000 financial data of Agro Dutch, Flex Foods, and Himalya 
International Ltd. (``Himalya''). However, to value profit, we only 
used the 1999-2000 financial data of Agro Dutch and Himalya because 
Flex Foods did not realize a profit during that year (see Notice of 
Final Determination of Sales at Less Than Fair Value: Steel Concrete 
Reinforcing Bars from Moldova, 66 FR 33525 (June 22, 2001) and 
accompanying decision memorandum at Comment 3). In addition, we did not 
use the 1999-2000 fiscal data obtained for Premier or the 1999-2000 
fiscal data obtained for Hindustan because although each company 
produces the subject merchandise, the subject merchandise is but one of 
several products which they produce and is not the major product 
produced by either company.
    Where appropriate, we did not include in the surrogate overhead and 
SG&A calculations the excise duty amount listed in the financial 
reports. We made certain adjustments to the ratios calculated as a 
result of reclassifying certain expenses contained in the financial 
reports. For a further discussion of the adjustments made, see the 
Preliminary Results Valuation Memorandum.
    All inputs were shipped by truck. Therefore, to value PRC inland 
freight, we used a November 1999 average truck freight value based on 
price quotes from Indian trucking companies.
    In accordance with the decision of the Court of Appeals for the 
Federal Circuit in Sigma Corp. v. United States, 117 F. 3d 1401 (Fed. 
Cir. 1997), we revised our methodology for calculating source-to-
factory surrogate freight for those material inputs that are valued 
based on CIF import values in the surrogate country. Therefore, we have 
added to CIF surrogate values from India a surrogate freight cost using 
the shorter of the reported distances from either the closest PRC port 
of importation to the

[[Page 10133]]

factory, or from the domestic supplier to the factory on an input-
specific basis.
    To value corrugated cartons, labels, paper, separators, tape, and 
glue we used April 2000-February 2001 average import values from 
Monthly Statistics.

Preliminary Results of the Review

    We preliminarily determine that the following margin exists for 
following exporters during the period February 1, 2000, through January 
31, 2001:

------------------------------------------------------------------------
   Manufacturer/producer/exporter               Margin percent
------------------------------------------------------------------------
Gerber Food (Yunnan) Co., Ltd.......  46.80
Raoping Xingyu Foods, Co., Ltd......  23.52
Shantou Hongda Industrial General     0.00 (de minimis)
 Corporation.
Shenxian Dongxing Foods Co., Ltd....  0.00 (de minimis)
PRC-Wide Rate.......................  198.63
------------------------------------------------------------------------

    We will disclose the calculations used in our analysis to parties 
to this proceeding within five days of the date of publication of this 
notice. Any interested party may request a hearing within 30 days of 
publication of this notice. If requested, a hearing will be scheduled 
upon receipt of responses to supplemental questionnaires and 
determination of briefing schedule.
    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, Room B-099, within 30 days of the 
date of 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 issues to be discussed. See 19 CFR 
351.310(c).
    Issues raised in the hearing will be limited to those raised in 
case briefs and rebuttal briefs. Case briefs from interested parties 
and rebuttal briefs, limited to the issues raised in the respective 
case briefs, may be submitted in accordance with a schedule to be 
determined upon the receipt of responses to supplemental 
questionnaires, which the Department will issue subsequent to the 
preliminary results. Parties who submit case briefs or rebuttal briefs 
in this proceeding are requested to submit with each argument (1) A 
statement of the issue and (2) a brief summary of the argument. Parties 
are also encouraged to provide a summary of the arguments not to exceed 
five pages and a table of statutes, regulations, and cases cited.
    The Department will issue the final results of these administrative 
and new shipper reviews, including the results of its analysis of 
issues raised in any such written briefs or at the hearing, if held, 
not later than 120 days after the date of publication of this notice.

Assessment Rates

    The Department shall determine, and the Customs Service shall 
assess, antidumping duties on all appropriate entries. Pursuant to 19 
CFR 351.212(b)(1), we will calculate importer-specific ad valorem duty 
assessment rates based on the ratio of the total amount of the dumping 
margins calculated for the examined sales to the total entered value of 
those same sales. In order to estimate the entered value, we will 
subtract applicable movement expenses from the gross sales value. In 
accordance with 19 CFR 351.106(c)(2), we will instruct the Customs 
Service to liquidate without regard to antidumping duties all entries 
of subject merchandise during the POR for which the importer-specific 
assessment rate is zero or de minimis (i.e., less than 0.50 percent). 
For entries subject to the PRC-wide rate, the Customs Service shall 
assess ad valorem duties at the rate established in the LTFV 
investigation. The Department will issue appropriate appraisement 
instructions directly to the Customs Service upon completion of this 
review.

Cash Deposit Requirements

    Upon completion of this review, for entries from each respondent 
listed above, we will require cash deposits at the rate established in 
the final results pursuant to 19 CFR 351.214(e) and as further 
described below.
    The following deposit requirements will be effective upon 
publication of the final results of these antidumping administrative 
and new shipper reviews for all shipments of certain preserved 
mushrooms from the PRC entered, or withdrawn from warehouse, for 
consumption on or after the publication date, as provided by section 
751(a)(1) of the Act: (1) The cash deposit rate for each respondent 
listed above will be the rate established in the final results; (2) the 
cash deposit rate for PRC exporters who received a separate rate in a 
prior segment of the proceeding, who did not export subject merchandise 
during the POR, or for which there was no request for administrative 
review (i.e., China Processed, Fujian Yu Xing, Xiamen Jiahua, Fujian 
Cereals, Shanghai Foodstuffs, the Canned Goods Company of Raoping, Tak 
Fat, Mei Wei, Zhang Zhou Longhai, Citic Ningbo, Zhejiang Cereals, China 
Ningbo, Longhai Senox, Beiliu Canned, Putian, General Canned Food 
Factory of Zhangzhou, Jiangsu Cereals, Shenzhen Cofry, Xiamen Gulong, 
and Dongya) will continue to be the rate assigned in that segment of 
the proceeding; (3) the cash deposit rate for the PRC NME entity will 
continue to be 198.63 percent; and (4) the cash deposit rate for non-
PRC exporters of subject merchandise from the PRC will be the rate 
applicable to the PRC supplier of that exporter. These requirements, 
when imposed, shall remain in effect until publication of the final 
results of the next administrative review.

Notification to Importers

    This notice serves as a preliminary reminder to importers of their 
responsibility under 19 CFR 351.402(f)(2) to file a certificate 
regarding the reimbursement of antidumping duties prior to liquidation 
of the relevant entries during this review period. Failure to comply 
with this requirement could result in the Secretary's presumption that 
reimbursement of antidumping duties occurred and the subsequent 
assessment of double antidumping duties.
    These administrative and new shipper reviews and notice are in 
accordance with sections 751(a)(1) and (2)(B) of the Act.

    Dated: February 28, 2002.
Faryar Shirzad,
Assistant Secretary for Import Administration.
[FR Doc. 02-5347 Filed 3-5-02; 8:45 am]
BILLING CODE 3510-DS-P