[Federal Register Volume 75, Number 107 (Friday, June 4, 2010)]
[Notices]
[Pages 31762-31763]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-13455]


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DEPARTMENT OF COMMERCE

Foreign-Trade Zones Board

[Docket 22-2009]


Foreign-Trade Zone 203; Application for Subzone Authority; REC 
Silicon; Invitation for Public Comment on Preliminary Recommendation

    The FTZ Board is inviting public comment on its staff's preliminary 
recommendation pertaining to the application by the Port of Moses Lake 
Public Corporation to establish a subzone at the REC Silicon facility 
in Moses Lake, Washington (Docket 22-2009). The staff's preliminary 
recommendation is for approval of the application with a restriction 
prohibiting admission of foreign status silicon metal subject to an 
anti-dumping duty (AD) or countervailing duty (CVD) order. The bases 
for this finding are as follows:
    Analysis of the application record indicates that full approval of 
the request could negatively impact domestic silicon metal production. 
This finding is based primarily on the potential impact to domestic 
silicon metal prices compounded by multiple applications potentially 
involving avoidance of AD/CVD duties on silicon metal used in export 
production.
    Although REC Silicon's current domestic purchases account for only 
a small portion of domestic silicon metal production, the company has 
been expanding its capacity and will need increased amounts of silicon 
metal as that production comes online. Thus, access to silicon metal 
subject to AD/CVD duties for its export production (currently over 95% 
of production) could encourage the company to source silicon metal 
subject to AD/CVD orders for its expanded production, instead of 
increasing domestic sourcing or sourcing imported silicon metal that is 
not subject to AD/CVD orders.
    A key consideration in this request is the cumulative effect on 
domestic silicon metal prices and on the integrity of the domestic 
silicon metal industry's AD/CVD relief should there be multiple 
applications to avoid AD/CVD duties on silicon metal for export 
production. In addition to the REC Silicon application, a similar 
application is pending for Dow Corning Corporation in Kentucky and we 
have received indication that further requests are being prepared for 
additional facilities. In its application, REC Silicon indicates that 
if it is granted full approval, other U.S. polysilison producers will 
likely apply for similar benefits. Given the production capacity of REC 
Silicon's domestic facilities, as well as those of the other U.S. 
producers, the ripple effect on silicon metal suppliers would be 
significant and the resulting impact would likely be a decline in the 
U.S. price of silicon metal.
    Currently, very little silicon metal subject to AD/CVD orders is 
imported into the United States. However, the potential increase in 
supply to the U.S. market from the use of silicon metal subject to AD/
CVD orders at this plant and others in the industry, and the resulting 
price effect, would likely be significant.
    In part due to the AD/CVD duties in place, U.S. silicon metal 
prices have increased. This has led to the recent restarting of a 
shuttered silicon metal production facility in New York. A weakening of 
the U.S. price of silicon metal could threaten the viability of this 
facility as well as the continuation of production at other domestic 
facilities.
    Given the volume of silicon metal involved in the current and 
anticipated applications, even a limit on the amount of silicon metal 
subject to AD/CVD orders that could be used in the facility for export 
production could have a significant impact on the U.S. price of silicon 
metal. The timing of that impact would also be occurring as domestic 
silicon metal production facilities are recovering and restarting, 
likely due (at least in part) to the relief provided through the AD/CVD 
orders that are in place. The FTZ regulations require that evaluations 
of manufacturing authority consider, ``whether the approval is 
consistent with trade policy and programs, and whether its net economic 
effect is positive'' (15 CFR 400.31(a)). In this case, given the 
potential impact on the silicon metal industry and based on the 
evidence currently on the record, the staff is unable to find that the 
net (national) economic effect of approving the use of silicon metal 
subject to AD/CVD orders for export production would be positive.
    While unrestricted approval could have a negative impact, the 
issues raised do not extend to silicon metal not subject to AD/CVD 
orders. No arguments or evidence have been presented to the FTZ Board 
in opposition to FTZ savings on silicon metal not subject to AD/CVD 
orders. Since REC Silicon indicated that they do not currently 
anticipate using silicon

[[Page 31763]]

metal subject to AD/CVD orders, activity under the proposed restricted 
approval would provide REC Silicon with the full savings estimated in 
the application. The company has indicated that those savings would 
enhance the cost competitiveness of its Washington facility, which 
would help to encourage continued production and employment at the 
facility.
    Public comment on the preliminary recommendation and the bases for 
the finding is invited through July 12, 2010. Rebuttal comments may be 
submitted during the subsequent 15-day period, until July 27, 2010. 
Submissions (original and one electronic copy) shall be addressed to 
the Board's Executive Secretary at: Foreign-Trade Zones Board, U.S. 
Department of Commerce, Room 2111, 1401 Constitution Ave., NW., 
Washington, DC 20230.
    For further information, contact Elizabeth Whiteman at 
[email protected] or (202) 482-0473.

    Dated: May 28, 2010.
Andrew McGilvray,
Executive Secretary.
[FR Doc. 2010-13455 Filed 6-3-10; 8:45 am]
BILLING CODE 3510-DS-P