[Federal Register Volume 68, Number 172 (Friday, September 5, 2003)]
[Notices]
[Pages 52741-52745]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-22661]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-122-845, A-122-847]


Notice of Final Determinations of Sales at Less Than Fair Value: 
Certain Durum Wheat and Hard Red Spring Wheat from Canada

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

ACTION: Notice of Final Determinations of Antidumping Duty 
Investigations.

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SUMMARY: On May 8, 2003, the Department of Commerce published the 
preliminary determinations in the antidumping duty investigations of 
durum wheat and hard red spring wheat from Canada. We gave interested 
parties an opportunity to comment on the preliminary determinations. 
Based upon the results of verification and our analysis of the comments 
received, we have made certain changes to the margin calculations 
presented in the final determinations of these investigations. We 
continue to find that durum wheat and hard red spring wheat from Canada 
were sold in the United States below normal value during the period of 
investigation. The final weighted-average dumping margins are listed 
below in the section entitled ``Continuation of Suspension of 
Liquidation.''

EFFECTIVE DATE:  September 5, 2003.

FOR FURTHER INFORMATION CONTACT: Julie Santoboni or Cole Kyle, Import 
Administration, International Trade Administration, U.S. Department of 
Commerce, 14th and Constitution Avenue, NW, Washington, DC 20230; 
telephone (202) 482-4194 or (202) 482-1503, respectively.

SUPPLEMENTARY INFORMATION:

Background

    On May 8, 2003, the Department of Commerce (``the Department'') 
published in the Federal Register the preliminary determinations in its 
investigations of durum wheat and hard red spring wheat from Canada 
(Notice of Preliminary Determinations of Sales at Less Than Fair Value: 
Certain Durum Wheat and Hard Red Spring Wheat From Canada, 68 FR 24707 
(May 8, 2003) (``Preliminary Determinations'')).
    Since the Preliminary Determinations, the following events have 
occurred:
    In May and June 2003, we conducted verifications of the sales and 
cost of production (``COP'') questionnaire responses submitted by the 
Canadian Wheat Board (``CWB'') and Canadian

[[Page 52742]]

hard red spring (``HRS'') wheat farmers at the CWB's headquarters, at 
the offices Meyers Norris Penny LLP and at certain farm locations. We 
issued verification reports in July 2003. We received case briefs from 
the petitioners\1\ and the CWB on July 30, 2003. We received rebuttal 
briefs from the petitioners and the CWB on August 5, 2003.
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    \1\ The petitioners are the North Dakota Wheat Commission 
(``NDWC'') (hard red spring wheat), the Durum Growers Trade Action 
Committee (durum wheat), and the U.S. Durum Growers Association 
(durum wheat).
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Scope of Investigations

    For purposes of these investigations, the products covered are (1) 
durum wheat and (2) hard red spring wheat.

1. Durum Wheat

    Imports covered by this investigation are all varieties of durum 
wheat from Canada. This includes, but is not limited to, a variety 
commonly referred to as Canada Western Amber Durum. The merchandise 
subject to this investigation is currently classifiable under the 
following Harmonized Tariff Schedule of the United States (``HTSUS'') 
subheadings: 1001.10.00.10, 1001.10.00.91, 1001.10.00.92, 
1001.10.00.95, 1001.10.00.96, and 1001.10.00.99. Although the HTSUS 
subheadings are provided for convenience and customs purposes, our 
written description of the scope of this proceeding is dispositive.

2. Hard Red Spring Wheat

    Imports covered by this investigation are all varieties of hard red 
spring wheat from Canada. This includes, but is not limited to, 
varieties commonly referred to as Canada Western Red Spring, Canada 
Western Extra Strong, and Canada Prairie Spring Red. The merchandise 
subject to this investigation is currently classifiable under the 
following HTSUS subheadings: 1001.90.10.00, 1001.90.20.05, 
1001.90.20.11, 1001.90.20.12, 1001.90.20.13, 1001.90.20.14, 
1001.90.20.16, 1001.90.20.19, 1001.90.20.21, 1001.90.20.22, 
1001.90.20.23, 1001.90.20.24, 1001.90.20.26, 1001.90.20.29, 
1001.90.20.35, and 1001.90.20.96. This investigation does not cover 
imports of wheat that enter under the subheadings 1001.90.10.00 and 
1001.90.20.96 that are not classifiable as hard red spring wheat. 
Although the HTSUS subheadings are provided for convenience and customs 
purposes, our written description of the scope of this proceeding is 
dispositive.

Scope Comments

    We have received several requests for exclusions from and 
clarifications of the scope of these investigations. On April 24, 2003, 
Montana Flour & Grains and Kamut International requested that the 
Department exclude Khorasan wheat from the scope of these 
investigations. The Government of Canada (``GOC'') made the same 
request on July 31, 2003. On June 27, 2003, the Organic Trade 
Association requested that the Department exclude organically produced 
wheat from the scope of these investigations. On July 29, 2003, 
Cargill, Incorporated (``Cargill'') requested that the Department 
clarify the scope of these investigations and specifically exclude from 
the scope Canadian Eastern Soft Red Winter Wheat and Canadian Eastern 
Hard Red Winter Wheat. On July 30, 2003, the petitioners submitted 
comments on all but the Cargill submission and also raised an 
additional issue concerning Canadian feed wheat. We have considered 
these requests and the comments from interested parties. We have 
determined that organically grown wheat is covered by the scope of 
these investigations and that the scope of the hard red spring 
investigation should be clarified by adding the following language to 
the scope: ``This investigation does not cover imports of wheat that 
enter under the subheadings 1001.90.10.00 and 1001.90.20.96 that are 
not classifiable as hard red spring wheat.'' For a complete discussion 
of these scope issues, see the August 28, 2003, Scope Exclusion and 
Clarification Requests: Khorasan Wheat, Organic Wheat, Canadian Eastern 
Soft Red Winter Wheat, Canadian Eastern Hard Red Winter Wheat, and 
Canadian Feed Wheat memorandum, which is on file in the Central Records 
Unit, Room B-099 of the Department (``CRU'').

Period of Investigation

    The period of investigation (``POI'') is July 1, 2001, through June 
30, 2002.

Use of Facts Available

    As explained in the Preliminary Determinations, we based the COP in 
part on the use of facts otherwise available, in accordance with 
section 776 of the Tariff Act of 1930, as amended effective January 1, 
1995 (``the Act''), by the Uruguay Round Agreements Act (``URAA'').
    Of the twenty-seven producers selected, one producer (i.e., cost 
respondent 2)\2\ chose not to respond to the Department's 
questionnaire, and two other producers (i.e., cost respondents 10 and 
27) did not respond based on extenuating circumstances discussed below. 
Therefore, as described in detail below, because these producers have 
not provided the necessary information on the record to calculate the 
simple-average COP within their respective stratum, the use of facts 
otherwise available is warranted.
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    \2\ Due to the proprietary nature of the name of each producer, 
we have assigned a number to each farmer (``cost respondent'') that 
will be used throughout this notice when referring to that specific 
farmer. A list or code key identifying the name associated with each 
cost respondent number can be found in the Cost of Production and 
Constructed Value Adjustments for the Preliminary Determination 
dated May 1, 2003 at Attachment 1, which is on file in the CRU.
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    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; (B) fails to provide such information 
by the deadlines for the submission of the information or in the form 
and manner requested, subject to subsections (c)(1) and (e) of section 
782 of the Act; (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) of the Act, the Department 
shall, subject to section 782(d) of the Act, use the facts otherwise 
available in reaching the applicable determination under this title.\3\ 
Section 776(b) of the Act further provides that adverse inferences may 
be used when a party has failed to cooperate by not acting to the best 
of its ability to comply with a request for information.
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    \3\ Where the Department determines that a response to a request 
for information does not comply with the request, section 782(d) of 
the Act provides that the Department will so inform the party 
submitting the response and will, to the extent practicable, provide 
that party the opportunity to remedy or explain the deficiency. If 
the party fails to remedy the deficiency within the applicable time 
limits, the Department may, subject to section 782(e) of the Act, 
disregard all or part of the original and subsequent responses, as 
appropriate. Section 782(e) of the Act provides that the Department 
``shall not decline to consider information that is submitted by an 
interested party and is necessary to the determination but does not 
meet all the applicable requirements established by the 
administering authority'' if the information is timely, can be 
verified, and is not so incomplete that it cannot be used, and if 
the interested party acted to the best of its ability in providing 
the information. Where all of these conditions are met, the statute 
requires the Department to use the information, if it can do so 
without undue difficulties.
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    With respect to cost respondent 2, this producer chose not to 
respond to the Department's questionnaire. As a result, use of facts 
available is appropriate pursuant to section 776(a)(2)(A) of the Act. 
In accordance with section 776(b) of the Act, if the Department finds 
that ``an interested party failed to cooperate

[[Page 52743]]

by not acting to the best of its ability to comply with a request for 
information,'' an adverse inference may be used in determining the 
facts otherwise available. In the instant case, cost respondent 2 did 
not cooperate to the best of its ability by failing to provide any of 
the information requested in the section D cost questionnaire with no 
rationale for why it could not provide such information when other 
producers could. Therefore, as adverse facts available for the final 
determination on HRS wheat for this cost respondent, we have continued 
to use the higher of the COP from the petition for the same province 
and soil type or the highest reported cost of other cost respondents 
within the same stratum. Based on our comparison of the amounts, we 
found that the reported cost of one of the other cost respondents 
within the same stratum was higher. As a result, we used the other 
respondent's COP within the same stratum as the surrogate cost for cost 
respondent 2.
    Both cost respondents 10 and 27 did not respond to the Department's 
cost questionnaire based on extenuating circumstances. With respect to 
cost respondent 10, the CWB explained that this farmer had deliveries 
of HRS wheat to the CWB during the POI, but did not produce HRS wheat 
during the 2001 growing season. However, cost respondent 10 did have an 
affiliated party that produced HRS wheat during the cost reporting 
period. Therefore, as a surrogate, cost respondent 10 reported its 
affiliate's COP for the cost reporting period. We note that this 
affiliate was not considered a cost respondent in the sample selection 
and, as such, we determined it would not be appropriate to include the 
affiliate's COP in our overall calculation of COP.
    Similar to cost respondent 10, cost respondent 27 did not provide 
cost data for the 2001 growing season because the information was not 
available. Specifically, cost respondent 27 sold its farming operations 
and ceased farming. Because neither cost respondent 10 nor 27 had 
information available that would enable them to respond to the 
Department's cost questionnaire and in the case of cost respondent 10 
they attempted to provide some cost information, we applied neutral 
facts available for the HRS wheat preliminary determination pursuant to 
sections 776(a)(2)(A) and (B) of the Act. As neutral facts available, 
we have relied on the cost data submitted by the other cost respondents 
within the same stratum. Therefore, we have not included an amount for 
these cost respondents in the simple average calculation within their 
respective stratums.

Fair Value Comparisons

    We calculated export price and normal value based on the same 
methodology used in the Preliminary Determinations with the following 
exceptions:
[sbull] We based our calculations on the CWB's updated and verified 
sales data. We used the revised sales data submitted by the CWB on June 
20, 2003, and the revisions stated in the CWB's July 9, 2003, 
submission.
[sbull] We revised the level of trade (``LOT'') classification to 
include only producer direct sales in LOTH/U2.
[sbull] We corrected a clerical error in the calculation of the LOT 
adjustment.
[sbull] We revised the cost of production calculation for HRS wheat to 
include certain changes noted in the August 28, 2003 Cost of Production 
and Constructed Value Adjustments for the Final Determinations Canadian 
Wheat Board Cost Respondents Memorandum (``Final Determination Cost 
Calculation Memorandum'')
    For a complete discussion of these changes, see the August 28, 
2003, Issues and Decision Memorandum for the Final Determinations of 
the Antidumping Duty Investigations of Certain Durum Wheat and Hard Red 
Spring Wheat from Canada (``Decision Memorandum''), Durum Wheat Final 
Determination Calculation Memorandum for the Canadian Wheat Board, Hard 
Red Spring Wheat Final Determination Calculation Memorandum for the 
Canadian Wheat Board, and the Final Determination Cost Calculation 
Memorandum.

Currency Conversions

    We made currency conversions in accordance with section 773A of the 
Act in the same manner as in the preliminary determinations.

Verifications

    As provided in section 782(i)(1) of the Act, we verified the 
information submitted by the CWB and selected farmers during May and 
June 2003. We used standard verification procedures, including 
examination of relevant accounting and production records, as well as 
original source documents provided by the CWB and certain individual 
cost respondents (i.e., farmers).

Analysis of Comments Received

    All issues raised in the petitioners' and the CWB's case briefs are 
addressed in the Decision Memorandum which is hereby adopted by this 
notice. Attached to this notice as an appendix is a list of the issues 
which the petitioners and the CWB have raised and to which we have 
responded in the Decision Memorandum. Parties can find a complete 
discussion of all issues raised in these investigations and the 
corresponding recommendations in this public memorandum which is on 
file in the Department's CRU. In addition, a complete version of the 
Decision Memorandum can be accessed directly on the Web at http://ia.ita.doc.gov/frn/summary/list.htm. The paper copy and electronic 
version of the Decision Memorandum are identical in content.

Continuation of Suspension of Liquidation

    In accordance with section 733(d)(2) of the Act, we are directing 
the U.S. Bureau of Customs and Border Protection (``BCBP'') to continue 
to suspend liquidation of all imports of subject merchandise from 
Canada that are entered, or withdrawn from warehouse, for consumption 
on or after May 8, 2003, the date of publication of the Preliminary 
Determinations in the Federal Register. The BCBP shall continue to 
require a cash deposit or the posting of a bond equal to the weighted-
average amount by which the NV exceeds the EP, as indicated in the 
chart below. These suspension-of-liquidation instructions will remain 
in effect until further notice. The weighted-average dumping margins 
are as follows:

                                                   Durum Wheat
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                 Exporter/Manufacturer                             Weighted-Average Margin Percentage
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Canadian Wheat Board..................................                                                      8.26
All Others............................................                                                      8.26
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[[Page 52744]]


                                              Hard Red Spring Wheat
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                 Exporter/Manufacturer                             Weighted-Average Margin Percentage
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Canadian Wheat Board..................................                                                      8.87
All Others............................................                                                      8.87
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ITC Notification

    In accordance with section 735(d) of the Act, we have notified the 
International Trade Commission (``ITC'') of our determinations. As our 
final determinations are affirmative, the ITC will, within 45 days, 
determine whether these imports are materially injuring, or threaten 
material injury to, the U.S. industry. If the ITC determines that 
material injury, or threat of material injury, does not exist, the 
proceeding will be terminated and all securities posted will be 
refunded or canceled. If the ITC determines that such injury does 
exist, the Department will issue antidumping duty orders.
    This notice also serves as a reminder to parties subject to 
administrative protective order (``APO'') of their responsibility 
concerning the disposition of proprietary information disclosed under 
APO in accordance with 19 CFR 351.305. Timely notification of return or 
destruction of APO materials, or conversion to judicial protective 
order, is hereby requested. Failure to comply with the regulations and 
the terms of an APO is a sanctionable violation.
    These determinations are issued and published in accordance with 
ections 735(d) and 777(i)(1) of the Act.

    Dated: August 28, 2003.
James J. Jochum,
Assistant Secretary for Import Administration.

APPENDIX

List of Comments in the Issues and Decision MemorandumSales Issues

Comment 1: Particular Market Situation
Comment 2: Inclusion of Certain Product Characteristics in Model Match 
Criteria
Comment 3: Date of Sale
Comment 4: Exclusion of Channel 6 Sales from LOTH 1
Comment 5: Treatment of Sales Made Above Normal Value
Comment 6: Clerical Error in the Calculation of the LOT Adjustment

Common Cost Issues

Comment 7: Farmer Estimates and Representations
Comment 8: Representative COPs
Comment 9: Eliminate Outliers in Calculating the Average COP
Comment 10: Collapsing
Comment 11: Seed Costs
Comment 12: Imputed Labor Costs
Comment 13: Personal Expenses
Comment 14: Overhead Allocation Basis
Comment 15: Financial Statement Depreciation
Comment 16: Affiliated Party Transactions Received Methodology
Comment 17: Costs of Services Provided to Outside Parties
Comment 18: Land Use
Comment 19: Crop Insurance Proceeds
Comment 20: Straw By-Product Offset
Comment 21: G&A and Interest Expense Denominators
Comment 22: Value of Bookkeeping Services

Farmer Specific Issues

Farmer 1

Comment 23: Production Quantities
Comment 24: Well Expenses
Comment 25: Over-Excluded Livestock Costs

Farmer 3

Comment 26: Imputed Seed Costs
Comment 27: Actual Labor Costs
Comment 28: Chemical Costs
Comment 29: Revenue from Green Barley
Comment 30: Country Elevator Charges

Farmer 4

Comment 31: Imputed Interest Expense
Comment 32: Short-Term Interest Income
Comment 33: Overhead Expenses Allocation Between Crops
Comment 34: Custom Work Costs
Comment 35: Land Use Cost
Comment 36: Machinery Repair Expenses

Farmer 5

Comment 37: Depreciation Expense of the Omitted Asset
Comment 38: Labor Cost for Non-Crop Activity

Farmer 6

Comment 39: Trucking Expense

Farmer 7

Comment 40: Unsupported Corrections to Normal Records
Comment 41: Reallocate Fertilizer Costs
Comment 42: Interest Expense Offset
Comment 43: Capitalization of Costs

Farmer 8

Comment 44: Imputed Seed
Comment 45: Production Quantity
Comment 46: Offset to Fertilizer Costs

Farmer 9

Comment 47: Depreciation Expense

Farmer 11

Comment 48: Fixed Assets
Comment 49: Land Use Costs

Farmer 12

Comment 50: Seed Cleaning Costs
Comment 51: Production Quantity
Comment 52: Custom Work Costs
Comment 53: Interest Charge on a Trade Payable Account

Farmer 14

Comment 54: Overstatement of Other Crop Costs
Comment 55: Understatement of Fertilizer Costs
Comment 56: Overhead Adjustment
Comment 57: Interest Expense
Comment 58: G&A Expense

Farmer 15

Comment 59: Tax Return Errors
Comment 60: Omitted Expenses
Comment 61: Livestock Costs

Farmer 16

Comment 62: Input Values for Seed, Fertilizer, and Chemicals
Comment 63: Cost Allocation Basis

Farmer 17

Comment 64: Omitted Actual Labor Cost

Farmer 19

Comment 65: Imputed Seed Costs
Comment 66: Depreciation Should be Included in Fixed Overhead
Comment 67: Revised Cash Ticket Analysis is Correctly Reported
Comment 68: Crop Insurance Profit Factor and Recoveries Should be 
Recalculated

Farmer 21

Comment 69: Fertilizer and Chemical Costs
Comment 70: Capitalization of Costs
Comment 71: Costs Not Associated With the Farmers' Livestock Operations

Farmer 22

Comment 72: Overhead Allocations, New Factual Information

Farmer 23

Comment 73: G&A Expenses

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Comment 74: Production Quantities

Farmer 26

Comment 75: Exclusion of the 2000 Seed from the 2001 Production 
Quantity
Comment 76: Improper Allocation of the Cost of Chemicals
[FR Doc. 03-22661 Filed 9-4-03; 8:45 am]
BILLING CODE 3510-DS-S