[Federal Register Volume 67, Number 69 (Wednesday, April 10, 2002)]
[Notices]
[Pages 17374-17379]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-8702]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-560-815]


Notice of Preliminary Determination of Sales at Not Less Than 
Fair Value: Carbon and Certain Alloy Steel Wire Rod from Indonesia.

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

DATES: April 10, 2002.

FOR FURTHER INFORMATION CONTACT: Michael Ferrier or Donna Kinsella at 
(202) 482-1394 or (202) 482-0194, respectively; Antidumping and 
Countervailing Duty Enforcement Group III, Import Administration, 
International Trade Administration, U.S. Department of Commerce, 14th 
Street and Constitution Avenue, N.W., Washington, D.C. 20230.

SUPPLEMENTARY INFORMATION:

The Applicable Statute

    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, as amended (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 (2001).

Preliminary Determination

    We preliminary determine that carbon and certain alloy steel wire 
rod from Indonesia is not being sold, or is not likely to be sold, in 
the United States at less than fair value (LTFV), as provided in 
section 733 of the Act. The estimated margins of sales at LTFV are 
shown in ``Suspension of Liquidation'' section of this notice.

Case History

    On September 24, 2001, the Department initiated antidumping 
investigations of wire rod from Brazil, Canada, Egypt, Germany, 
Indonesia, Mexico, Moldova, South Africa, Trinidad and Tobago, Ukraine, 
and Venezuela. See Notice of Initiation of Antidumping Duty 
Investigations: Carbon and Certain Alloy Steel Wire Rod From Brazil, 
Canada, Egypt, Germany, Indonesia, Mexico, Moldova, South Africa, 
Trinidad and Tobago, Ukraine, and Venezuela, 66 FR 50164 (October 2, 
2001) (Initiation Notice). The petitioners in this investigation are 
Co-Steel Raritan, Inc., GS Industries, Keystone Consolidated 
Industries, Inc.,

[[Page 17375]]

and North Star Steel Texas, Inc. (``petitioners''). Since the 
initiation of the investigation, the following events have occurred.
    In a letter dated October 9, 2001, petitioners (Co-Steel Raritan, 
Inc., GS Industries, Keystone Consolidated Industries, Inc., and North 
Star Steel Texas, Inc.) requested the scope of the investigation be 
amended to exclude high carbon, high tensile 1080 grade tire cord and 
tire bead quality wire rod actually used in the production of tire cord 
and bead, as defined by specific dimensional characteristics and 
specifications.
    On October 15, 2001, the United States International Trade 
Commission (USITC) notified the Department of its affirmative 
preliminary injury determination on imports of subject merchandise from 
Brazil, Canada, Germany, Indonesia, Mexico, Moldova, Trinidad and 
Tobago, and Ukraine.
    On October 16, 2001, the Department issued a letter to interested 
parties in all of the concurrent wire rod antidumping investigations, 
providing an opportunity to comment on the Department's proposed model 
match characteristics and hierarchy. Petitioners submitted comments on 
October 24, 2001. The Department also received comments on model 
matching from respondents Hysla S.A. de C.V. (Mexico), Ivaco, Inc,. and 
Ispat Sidbec Inc. (Canada).
    On October 29, 2001, the USITC published its preliminary 
determination stating that there is a reasonable indication that an 
industry in the United States is materially injured by reason of 
imports of the subject merchandise from Brazil, Canada, Germany, 
Indonesia, Mexico, Moldova, Trinidad and Tobago, and Ukraine. See 
Carbon and Certain Alloy Steel Wire Rod From Brazil, Canada, Egypt, 
Germany, Indonesia, Mexico, Moldova, South Africa, Trinidad and Tobago, 
Turkey, Ukraine, and Venezuela, 66 FR 54539 (October 29, 2001).
    On November 28, 2001, five U.S. tire manufacturers and an industry 
trade association, the Rubber Manufacturers Association, submitted a 
letter to the Department in response to petitioners' October 9, 2001, 
submission regarding the exclusion of certain 1080 grade tire cord and 
tire bead wire rod used in the production of tire cord and bead. 
Additionally, the tire manufacturers requested clarification from the 
Department if 1090 grade wire rod is included in petitioners' October 
9, 2001, scope exclusion request. The tire manufactures also requested 
an exclusion from the scope of this investigation for 1070 grade wire 
rod and related grades, citing a lack of domestic production capacity 
to meet the requirements of the tire industry. On November 28, 2001, 
petitioners further clarified and modified their October 9, 2001 
amendment of the scope of the petition. Finally, on January 21, 2002, 
Tokusen U.S.A., Inc. submitted a request that grade 1070 tire cord wire 
rod, and tire cord wire rod more generally, be excluded from the scope 
of the antidumping dumping duty and countervailing duty investigations.
    On January 17, 2002, petitioners requested that the Department 
extend the deadline for issuance of the preliminary determination by 30 
days. On January 28, 2002, the Department published in the Federal 
Register the notice postponing the preliminary determination to March 
13, 2002 (see Notice of Postponement of Preliminary Antidumping Duty 
Determinations: Carbon and Certain Alloy Steel Wire Rod From Brazil, 
Canada, Germany, Indonesia, Mexico, Moldova, Trinidad and Tobago, and 
Ukraine, 67 FR 3877). On March 4, 2002, petitioners submitted a letter 
to the Department requesting the Department to extend the deadline for 
issuance of the preliminary determination by an additional 20 days. The 
Department published in the Federal Register the notice postponing the 
preliminary determination an additional 20 days to April 2, 2002 (see 
Notice of Postponement of Preliminary Antidumping Duty Determinations: 
Carbon and Certain Alloy Steel Wire Rod From Brazil, Canada, Germany, 
Indonesia, Mexico, Moldova, Trinidad and Tobago, and Ukraine, 67 FR 
11674).
    On November 6, 2001, the Department issued all sections of its 
antidumping duty questionnaire to P.T. Ispat Indo (``Ispat Indo''). On 
December 11, 2001, the Department received Ispat Indo's response to 
Section A of the questionnaire. On December 18, 2001, petitioners filed 
comments on Ispat Indo's section A response. Ispat Indo filed its 
response to Sections B, C, and D of the questionnaire on December 27, 
2001. The Department issued a supplemental questionnaire for Ispat 
Indo's Section A response on December 28, 2001. On January 4, 2002, 
petitioners filed comments on Ispat Indo's Sections B, C, and D 
response. On January 9, 2002, petitioners filed additional comments on 
Ispat Indo's Sections B, C, and D responses. On January 10, 2002, the 
Department issued a supplemental questionnaire for Ispat Indo's Section 
B and C responses. On January 18, 2002, Ispat Indo submitted its 
response to the Department's Section A supplemental questionnaire. On 
January 28, 2002, the Department issued a supplemental questionnaire to 
Ispat Indo's Section D response. Ispat Indo submitted their 
supplemental Section D response to the Department on February 19, 2002. 
On March 12, 2002, petitioners submitted additional comments on 
supplemental Sections A, B, C, and D questionnaire responses. On March 
18, 2002, Ispat Indo submitted additional information at the 
Department's request.

Period of Investigation

    The POI is July 1, 2000 through June 30, 2001. This period 
corresponds to the four most recent fiscal quarters prior to the filing 
of the petition (i.e., August 2001), and is in accordance with section 
351.204(b)(1) of the Department's regulations.

Scope of Investigation

    The merchandise covered by these investigations is certain hot-
rolled products of carbon steel and alloy steel, in coils, of 
approximately round cross section, 5.00 mm or more, but less than 19.00 
mm, in solid cross-sectional diameter.
    Specifically excluded are steel products possessing the above-noted 
physical characteristics and meeting the Harmonized Tariff Schedule of 
the United States (HTSUS) definitions for (a) stainless steel; (b) tool 
steel; (c) high nickel steel; (d) ball bearing steel; and (e) concrete 
reinforcing bars and rods. Also excluded are (f) free machining steel 
products (i.e., products that contain by weight one or more of the 
following elements: 0.03 percent or more of lead, 0.05 percent or more 
of bismuth, 0.08 percent or more of sulfur, more than 0.04 percent of 
phosphorus, more than 0.05 percent of selenium, or more than 0.01 
percent of tellurium).
    Also excluded from the scope are 1080 grade tire cord quality wire 
rod and 1080 grade tire bead quality wire rod. This grade 1080 tire 
cord quality rod is defined as: (i) grade 1080 tire cord quality wire 
rod measuring 5.0 mm or more but not more than 6.0 mm in cross-
sectional diameter; (ii) with an average partial decarburization of no 
more than 70 microns in depth (maximum individual 200 microns); (iii) 
having no inclusions greater than 20 microns; (iv) having a carbon 
segregation per heat average of 3.0 or better using European Method NFA 
04-114; (v) having a surface quality with no surface defects of a 
length greater than 0.15 mm; (vi) capable of being drawn to a diameter 
of 0.30 mm or less with 3 or fewer breaks per ton, and (vii) containing 
by weight the following elements in the proportions shown: (1) 0.78 
percent or more of carbon, (2) less than 0.01 percent of aluminum, (3)

[[Page 17376]]

0.040 percent or less, in the aggregate, of phosphorus and sulfur, (4) 
0.006 percent or less of nitrogen, and (5) not more than 0.15 percent, 
in the aggregate, of copper, nickel and chromium.
    This grade 1080 tire bead quality rod is defined as: (i) grade 1080 
tire bead quality wire rod measuring 5.5 mm or more but not more than 
7.0 mm in cross-sectional diameter; (ii) with an average partial 
decarburization of no more than 70 microns in depth (maximum individual 
200 microns); (iii) having no inclusions greater than 20 microns; (iv) 
having a carbon segregation per heat average of 3.0 or better using 
European Method NFA 04-114; (v) having a surface quality with no 
surface defects of a length greater than 0.2 mm; (vi) capable of being 
drawn to a diameter of 0.78 mm or larger with 0.5 or fewer breaks per 
ton; and (vii) containing by weight the following elements in the 
proportions shown: (1) 0.78 percent or more of carbon, (2) less than 
0.01 percent of soluble aluminum, (3) 0.040 percent or less, in the 
aggregate, of phosphorus and sulfur, (4) 0.008 percent or less of 
nitrogen, and (5) either not more than 0.15 percent, in the aggregate, 
of copper, nickel and chromium (if chromium is not specified), or not 
more than 0.10 percent in the aggregate of copper and nickel and a 
chromium content of 0.24 to 0.30 percent (if chromium is specified).
    The designation of the products as ``tire cord quality'' or ``tire 
bead quality'' indicates the acceptability of the product for use in 
the production of tire cord, tire bead, or wire for use in other rubber 
reinforcement applications such as hose wire. These quality 
designations are presumed to indicate that these products are being 
used in tire cord, tire bead, and other rubber reinforcement 
applications, and such merchandise intended for the tire cord, tire 
bead, or other rubber reinforcement applications is not included in the 
scope. However, should petitioners or other interested parties provide 
a reasonable basis to believe or suspect that there exists a pattern of 
importation of such products for other than those applications, end-use 
certification for the importation of such products may be required. 
Under such circumstances, only the importers of record would normally 
be required to certify the end use of the imported merchandise.
    All products meeting the physical description of subject 
merchandise that are not specifically excluded are included in this 
scope.
    The products under investigation are currently classifiable under 
subheadings 7213.91.3010, 7213.91.3090, 7213.91.4510, 7213.91.4590, 
7213.91.6010, 7213.91.6090, 7213.99.0031, 7213.99.0038, 7213.99.0090, 
7227.20.0010, 7227.20.0020, 7227.20.0090, 7227.20.0095, 7227.90.6051, 
7227.90.6053, 7227.90.6058, and 7227.90.6059 of the HTSUS. Although the 
HTSUS subheadings are provided for convenience and customs purposes, 
the written description of the scope of this proceeding is dispositive.
    See Carbon and Certain Alloy Steel Wire Rod: Requests for exclusion 
of various tire cord quality wire rod and tire bead quality wire rod 
products from the scope of antidumping duty (Brazil, Canada, Egypt, 
Germany, Indonesia, Mexico, Moldova, South Africa, Trinidad and Tobago, 
Ukraine, and Venezuela) and countervailing duty (Brazil, Canada, 
Germany, Trinidad and Tobago, and Turkey) investigations.

Date of Sale

    As stated in 19 CFR 351.401(i), the Department normally will use 
invoice date as the date of sale unless another date better reflects 
the date on which the exporter or producer establishes the material 
terms of sale. Ispat Indo reported the invoice date as the home market 
date of sale, and the invoice date as the U.S. date of sale. Ispat Indo 
stated that both local and export sales are booked in Ispat Indo's 
accounts at the time invoice is issued. Ispat Indo maintains that the 
invoice is the first document confirming the final terms of the sale 
for both home market and U.S. market sales.
    We have examined whether invoice date, contract date, or some other 
date best represents the date on which the material terms of sale are 
established for both home market and U.S. sales. The Department has 
examined the information submitted by Ispat Indo concerning the sales 
contracts, invoices, and purchase agreements issued during the POI and 
has found that the material terms of sale are firmly established at 
invoice date. Specifically, we find that changes in quantity and 
product specifications referred to by Ispat Indo do occur after the 
contract date, but not after invoice date. For additional details of 
our analysis of the date of sale issue,see Memorandum to the File 
Regarding Antidumping Duty Investigation on Carbon and Certain Alloy 
Steel Wire Rod from Indonesia; Preliminary Determination Analysis for 
P.T. Ispat Indo(April 2, 2002) (Analysis Memo). Accordingly, for home 
market and U.S. sales, we have preliminarily determined that invoice 
date is the appropriate date of sale in this investigation because it 
best represents the date upon which the material terms of sale are 
established.

Product Comparisons

    In accordance with section 771(16) of the Act, all products 
produced by Ispat Indo, covered by the description in the ``Scope of 
Investigation'' above and sold in Indonesia during the POI are 
considered to be foreign like products for purposes of determining 
appropriate product comparisons to U.S. sales. Where there were no 
sales of identical merchandise in the home market to compare to U.S. 
sales, the Department compared U.S. sales to the next most similar 
foreign like product on the basis of the characteristics listed in 
Appendix V of the Department's November 6, 2001, antidumping 
questionnaire. If there were no home market foreign like products to 
compare to a U.S. sale, we used constructed value (CV).

Fair Value Comparisons

    To determine whether sales of wire rod from Indonesia to the United 
States were made at LTFV, we compared the export price (EP) to the 
normal value (NV), as described in the ``Export Price'' and ``Normal 
Value'' sections of this notice. In accordance with section 
777A(d)(1)(A)(i) of the Act, we calculated weighted-average EPs for 
comparison to NV.

Export Price

    We calculated EP in accordance with section 772(a) of the Act 
because Ispat Indo sold the merchandise directly to the first 
unaffiliated purchaser in the United States prior to the date of 
importation, or Ispat Indo sold the merchandise through an affiliated 
trading company outside the United States who re-sold the merchandise 
directly to an unaffiliated purchaser in the United States prior to the 
date of importation, and because constructed export price (CEP) 
methodology was not otherwise appropriate. We based EP for Ispat Indo 
on the CIF FO (free out) price to unaffiliated purchasers in the United 
States. CIF FO has the same meaning as CIF. In accordance with 
772(c)(2), we made deductions from the starting price for movement 
expenses, including foreign inland freight and brokerage and handling.

Normal Value

Selection of Comparison Market

    In order to determine whether there is a sufficient volume of sales 
in the home market to serve as a viable basis for calculating NV (i.e., 
whether the aggregate quantity of the foreign like product is equal to 
or greater than five percent of the aggregate quantity of U.S.

[[Page 17377]]

sales), we compared Ispat Indo's volume of home market sales of the 
foreign like product to the volume of U.S. sales of the subject 
merchandise, in the accordance with section 773(a)(1) of the Act and 
section 351.404(b) of the Department's regulations. Since Ispat Indo's 
aggregate quantity of home market sales of the foreign like product was 
greater than five percent of its aggregate quantity of U.S. sales for 
the subject merchandise, we determined that the home market was viable 
for Ispat Indo. Therefore, we have based NV on home market sales in the 
usual quantities and in the ordinary course of trade.

Affiliate Party Transactions and Arm's Length Test

    To test whether these sales were made at arm's length prices, the 
Department compared, on a model-specific basis, the prices of sales to 
affiliated customers with sales to unaffiliated customers net of all 
movement charges, discounts, direct selling expenses, billing 
adjustments, and packing. Where, for the tested models of the foreign 
like product, prices to the affiliated party were on average 99.5 
percent or more of the price to unaffiliated parties, the Department 
determined that sales made to the affiliated party were at arm's 
length. See 19 CFR 351.403(c); see also Antidumping Duties; 
Countervailing Duties Final Rule, 62 FR 27355 (May 19, 1997).
    If these affiliated party sales satisfied the arm's length test, we 
used them in our analysis. Merchandise sold to affiliated customers in 
the home market made at non-arm's length prices were excluded from our 
analysis because we considered them to be outside the ordinary course 
of trade. See 19 CFR 351.102. Where the exclusion of such sales 
eliminated all sales of the most appropriate comparison product, we 
made a comparison to the next most similar model.
    Ispat Indo reported the sales to its home market affiliate, P.T. 
Ispat Wire Products (``IWP''). These sales account for more than 5% the 
total of Ispat Indo's home market sales during the POI. See 19 CFR 
351.403(d). The respondent stated that its affiliate consumed almost 
all of the wire rod purchased from Ispat Indo in the production of non-
subject merchandise. Since Ispat Indo's sales to IWP were at arm's 
length, the Department did not require Ispat Indo to report home market 
downstream sales by its affiliate for this preliminary determination. 
See Final Rule, 62 FR 27355. Sales of subject merchandise resold to the 
United States by the company's affiliate were reported as U.S. sales by 
Ispat Indo.

Cost of Production Analysis

    Based on our analysis of the cost allegations submitted by 
petitioners in the original petition, in accordance with section 
773(b)(2)(A)(i) of the Act, the Department found reasonable grounds to 
believe or suspect that Indonesian producers had made sales of wire rod 
in the home market at prices below the cost of producing the 
merchandise. As a result, the Department initiated an investigation to 
determine whether respondents made home market sales during the POI at 
prices below their cost of production (COP) within the meaning of 
section 773(b) of the Act. We conducted the COP analysis described 
below.
1. Calculation of COP
     In accordance with section 773(b)(3) of the Act, we calculated a 
weighted-average COP based on the sum of Ispat Indo's cost of materials 
and fabrication for the foreign like product, plus amounts for home 
market selling, general, and administrative expenses (SG&A), interest 
expenses, and packing costs. We revised the numerator of Ispat Indo's 
SG&A rate calculation and the numerator of the interest expense rate 
calculation. For additional details of our cost analysis, see Cost of 
Production and Constructed Value Calculation Adjustments for the 
Preliminary Determination (April 2, 2002) (Cost Memo). The Department 
relied on the COP and CV data submitted by Ispat Indo in its 
supplemental Section D response on February 19, 2002.
2. Test of Home Market Sales Prices
    We compared the weighted-average COP for Ispat Indo to home market 
sales of the foreign like product, as required under section 773(b) of 
the Act, in order to determine whether these sales had been made at 
prices below the COP. In determining whether to disregard home market 
sales made at prices below the COP, we examined whether such sales were 
made (1) in substantial quantities within an extended period of time, 
and (2) at prices which permitted the recovery of all costs within a 
reasonable period of time, in accordance with section 773(b)(1)(A) and 
(B) of the Act. On a product-specific basis, we compared COP to home 
market prices, less any applicable movement charges, billing 
adjustments, taxes, and discounts and rebates. See section 773(f)(1)(B) 
of the Act.
3. Results of the COP Test
    Pursuant to section 773(b)(2)(C)(i) of the Act, where less than 
twenty percent of Ispat Indo's sales of a given product were at prices 
less than the COP, we did not disregard any below-cost sales of that 
product because we determined that the below-cost sales were not made 
in ``substantial quantities.'' Where twenty percent or more of its 
sales of a given product during the POI were at prices less than the 
COP, we determined such sales to have been made in substantial 
quantities within an extended period of time. In addition, pursuant to 
section 773(b)(2)(D) of the Act, we also determined whether such sales 
were made at prices which would permit recovery of all costs within a 
reasonable period of time. In such a case, we disregard the below-cost 
sales. Our cost test for Ispat Indo revealed that more than twenty 
percent of the respondent's home market sales of certain products were 
at prices below their respective COP, which did not permit the recovery 
of all costs within a reasonable period of time. Therefore, we 
disregarded the below-cost sales and used the remaining above cost 
sales in our analysis, in accordance with 773(b)(1) of the Act. See 
Analysis Memo, April 2, 2002.

Constructed Value

    If no sales made in the ordinary course of trade in the home market 
remain, NV shall be based on CV. See section 773(b)(1) of the Act. In 
accordance with section 773(e)(1) of the Act, we calculated CV based on 
the sum of respondent's cost of materials, fabrication, SG&A, including 
interest expenses, and profit. In accordance with section 773(e)(2)(A) 
of the Act, we based SG&A and profit on the amounts incurred and 
realized by Ispat Indo in connection with the production and sale of 
the foreign like product in the ordinary course of trade for 
consumption in the foreign country. We used the CV data the respondent 
supplied in its section D questionnaire and supplemental questionnaire 
response.

Price-to-Price Comparisons

    We based NV for Ispat Indo on prices of home market sales that 
passed the COP test. We made deductions for discounts. We made 
deductions, where appropriate, for inland freight and inland insurance, 
pursuant to section 773(a)(6)(B) of the Act. We made adjustments, where 
appropriate, for physical differences in the merchandise in accordance 
with section 773(a)(6)(C)(ii) of the Act, and 19 CFR 351.411. In 
accordance with section 773(a)(6)(C)(iii) of the Act and 19 CFR 
351.410, we made circumstances of sale (COS) adjustments for imputed 
credit expenses and bank charges. We also deducted home market packing 
costs

[[Page 17378]]

and added U.S. packing costs in accordance with section 773(a)(6)(A) 
and(B) of the Act.

Price-to-CV Comparisons

    In accordance with section 773(a)(4) of the Act, we based NV on CV 
if we were unable to find a home market match of identical or similar 
merchandise within the contemporaneous period. We calculated CV based 
on the costs of materials and fabrication employed in producing the 
subject merchandise, SG&A, and profit pursuant to section 773(e) of the 
Act. In accordance with section 773(e)(2)(A) of the Act, we based SG&A 
expense and profit on the amounts incurred and realized by Ispat Indo 
in connection with the production and sale of the foreign like product 
in the ordinary course of trade for consumption in Indonesia. For 
selling expenses, we used the weighted-average home market selling 
expenses. Where appropriate, we made adjustments to CV in accordance 
with section 773(a)(8) of the Act. For comparisons to EP, we made COS 
adjustments by deducting home market direct selling expenses and adding 
U.S. direct selling expenses.

Level of Trade

    In accordance with section 773(a)(1)(B) of the Act, to the extent 
practicable, we determine NV based on sales in the comparison market at 
the same level of trade (LOT) as the EP transaction. The NV LOT is that 
of the starting-price sales in the comparison market or, when NV is 
based on CV, that of the sales from which we derive SG&A expenses and 
profit. For EP, the U.S. LOT is also the level of the starting-price 
sale, which is usually from the exporter to the importer. To determine 
whether NV sales are at a different LOT than EP, we examine stages in 
the marketing process and selling functions along the chain of 
distribution between the producer and the unaffiliated customer. If the 
comparison-market sales are at a different LOT and the difference 
affects price comparability, as manifested in a pattern of consistent 
price differences between the sales on which NV is based and 
comparison-market sales at the LOT of the export transaction, we make a 
LOT adjustment pursuant to section 773(a)(7)(A) of the Act. See Notice 
of Final Determination of Sales at Less Than Fair Value; Certain Cut-
to-Length Carbon Steel Plate from South Africa, 62 FR 61731 (November 
19, 1997).
    In determining whether separate LOTs actually existed in the home 
market for Ispat Indo, we examined whether the respondent's sales 
involved different marketing stages (or their equivalent) based on the 
channel of distribution, customer categories, and selling functions (or 
services offered) to each customer or customer category, in both 
markets. Ispat Indo claimed one LOT in the U.S. and one LOT in the home 
market. Ispat Indo sells to end-users, both in the home market and the 
U.S. market. In the home market, Ispat Indo has one channel of 
distribution. It consists of Ispat Indo selling directly to affiliated 
and unaffiliated end-users in the home market. For the U.S. market, 
Ispat Indo stated that it sells through one channel of distribution, 
directly to end-users in the U.S. Within this channel of distribution, 
Ispat Indo made sales to end-users where the producing mill directly 
invoices the U.S. customer, or the producing mill sells the merchandise 
to IWP who resells the merchandise in the original form to the U.S. 
customer, or the producing mill invoices a related trading company and 
ships the merchandise directly to the U.S. customer.
    In analyzing Ispat Indo's selling activities for its home market 
and U.S. market, we determined that essentially the same services were 
provided in both markets. Ispat Indo provides indirect technical 
services (i.e., answering routine questions on technical matters) to 
customers in both the U.S. and home markets. Additionally, the 
respondent did not incur any warranty expenses in the U.S. and home 
markets. Therefore, based upon this information, we have preliminary 
determined that the LOT for all EP sales is the same LOT for all sales 
in the home market. Accordingly, because we find the U.S. sales and 
home market sales to be at the same LOT, no LOT adjustment under 
section 773(a)(7)(A) of the Act is warranted for Ispat Indo.

Currency Conversion

    We made currency conversions into U.S. dollars based on the 
exchange rates in effect on the dates of the U.S. sales as certified by 
the Federal Reserve Bank. Section 773A(a) of the Act directs the 
Department to use a daily exchange rate in order to convert foreign 
currencies into U.S. dollars unless the daily rate involves a 
fluctuation. It is the Department's practice to find that a fluctuation 
exists when the daily exchange rate differs from the benchmark rate by 
more than 2.25 percent. The benchmark is defined as the moving average 
of rates for the 40 business days immediately prior to the date of the 
actual daily rate to be classified. When we determine a fluctuation to 
have existed, we substitute the benchmark rate for the daily rate, in 
accordance with established practice. Further, section 773A(b) of the 
Act directs the Department to allow a 60-day adjustment period when a 
currency has undergone a sustained movement. A sustained movement has 
occurred when the weekly average of actual daily rates exceeds the 
weekly average of benchmark rates by more than five percent of eight 
consecutive weeks. (For an explanation of this method, see Policy 
Bulletin 96-1: Currency Conversions, 61 FR 9434 (March 8, 1996).

Verification

    In accordance with section 782(i) of the Act, we intend to verify 
all information relied upon in making our final determination.

Suspension of Liquidation

    In accordance with section 733(b)(3) of the Act, the Department 
will disregard any weighted-average dumping margin that is zero or de 
minimis, i.e. less than 2 percent ad valorem. Based on our preliminary 
margin calculation, we will not direct the U.S. Customs Service to 
suspend liquidation of any entries of wire rod from Indonesia as 
described in the ``Scope of Investigation'' section, that are entered, 
or withdrawn from warehouse, for consumption on or after the date of 
publication of this notice in the Federal Register. The Department does 
not require any cash deposit or posting of a bond for this preliminary 
determination. The weighted-average dumping margin in the preliminary 
determination is as follows:

------------------------------------------------------------------------
                Exporter/manufacturer                   Margin (percent)
------------------------------------------------------------------------
P.T. Ispat Indo......................................             55 % *
------------------------------------------------------------------------

    * De minimis

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, within 75 days after the date of our final 
determination, whether these imports are materially injuring, or 
threatening material injury to, the U.S. industry.

Public Comment

    Case briefs for this investigation must be submitted no later than 
one week after the issuance of the verification reports. Rebuttal 
briefs must be filed within five days after the deadline for submission 
of case briefs. A list of authorities used, a table of contents, and

[[Page 17379]]

an executive summary of issues should accompany any briefs submitted to 
the Department. Executive summaries should be limited to five pages 
total, including footnotes. Section 774 of the Act provides that the 
Department will hold a hearing to afford interested parties an 
opportunity to comment on arguments raised in case or rebuttal briefs, 
provided that such a hearing is requested by any interested party. If a 
request for a hearing is made in an investigation, the hearing will 
tentatively be held two days after the deadline for submission of the 
rebuttal briefs, at the U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW, Washington, DC 20230. In the event that the 
Department receives requests for hearings from parties to several wire 
rod cases, the Department may schedule a single hearing to encompass 
all those cases. 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 participate if one is 
requested, must submit a written request within 30 days of the 
publication of this notice. Requests should specify the number of 
participants and provide 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 
no later than 75 days after the date of this preliminary determination.
    This determination is issued and published in accordance with 
sections 733(f) and 777(i)(1) of the Act.

    Dated: April 2, 2002
Faryar Shirzad,
Assistant Secretary for Import Administration.
[FR Doc. 02-8702 Filed 4-9-02; 8:45 am]
BILLING CODE 3510-DS-S