[Federal Register Volume 90, Number 119 (Tuesday, June 24, 2025)]
[Notices]
[Pages 26799-26802]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2025-11537]
[[Page 26799]]
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DEPARTMENT OF COMMERCE
International Trade Administration
[C-570-216]
L-Lysine From the People's Republic of China: Initiation of
Countervailing Duty Investigation
AGENCY: Enforcement and Compliance, International Trade Administration,
Department of Commerce.
DATES: Applicable June 17, 2025.
FOR FURTHER INFORMATION CONTACT: Allison Hollander, Office IX, AD/CVD
Operations, Enforcement and Compliance, International Trade
Administration, U.S. Department of Commerce, 1401 Constitution Avenue
NW, Washington, DC 20230; telephone: (202) 482-2805.
SUPPLEMENTARY INFORMATION:
The Petition
On May 28, 2025, the U.S. Department of Commerce (Commerce)
received a countervailing duty (CVD) petition concerning imports of L-
lysine (lysine) from the People's Republic of China (China), filed in
proper form on behalf of the Lysine Fair Trade Coalition and its
individual members (the petitioners).\1\ The CVD Petition was
accompanied by an antidumping duty (AD) petition concerning imports of
lysine from China.\2\
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\1\ See Petitioner's Letter, ``Petition for the Imposition of
Antidumping and Countervailing Duties,'' dated May 28, 2025
(Petition). The individual members of the Lysine Fair Trade
Coalition are Archer Daniels Midland Company, CJ Bio America, Inc.,
and Evonik Corporation.
\2\ Id.
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Between May 30 and June 12, 2025, Commerce requested supplemental
information pertaining to certain aspects of the Petition in
supplemental questionnaires.\3\ Between June 2 and 16, 2025, the
petitioners filed timely responses to these requests for additional
information.\4\
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\3\ See Commerce's Letters, ``Supplemental Questions,'' dated
May 30, 2025 (First General Issues Questionnaire); ``Supplemental
Questions,'' dated May 29, 2025; and Memorandum, ``Phone Call with
Counsel to the Petitioners,'' dated June 12, 2025 (June 12, 2025,
Memorandum).
\4\ See Petitioners' Letters, ``Petitioners' Supplement to
Volume I of the Petition for the Imposition of Antidumping and
Countervailing Duties,'' dated June 3, 2025 (First General Issues
Supplement); ``Petitioners' Response to Supplemental Questionnaire
Concerning Volume II of Petition,'' dated June 2, 2025; and
``Petitioners' Response to 2nd Supplemental Questionnaire Regarding
Common Issues and Injury Volume I of the Petition,'' dated June 16,
2025 (Second General Issues Supplement).
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In accordance with section 702(b)(1) of the Tariff Act of 1930, as
amended (the Act), the petitioners allege that the Government of China
(GOC) is providing countervailable subsidies, within the meaning of
sections 701 and 771(5) of the Act, to producers of lysine in China,
and that such imports are materially injuring, or threatening material
injury to, the domestic industry producing lysine in the United States.
Consistent with section 702(b)(1) of the Act and 19 CFR 351.202(b), for
those alleged programs on which we are initiating a CVD investigation,
the Petition was accompanied by information reasonably available to the
petitioners supporting their allegations.
Commerce finds that the petitioners filed the Petition on behalf of
the domestic industry, because the petitioners are interested parties,
as defined in sections 771(9)(C) and (F) of the Act. Commerce also
finds that the petitioners demonstrated sufficient industry support
with respect to the initiation of the requested CVD investigation.\5\
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\5\ See section on ``Determination of Industry Support for the
Petition,'' infra.
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Period of Investigation
Because the Petition was filed on May 28, 2025, the period of
investigation (POI) is January 1, 2024, through December 31, 2024.\6\
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\6\ See 19 CFR 351.204(b)(2).
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Scope of the Investigation
The product covered by this investigation is lysine from China. For
a full description of the scope of this investigation, see the appendix
to this notice.
Comments on the Scope of the Investigation
On May 30 and June 12, 2025, Commerce requested information and
clarification from the petitioners regarding the proposed scope to
ensure that the scope language in the Petition is an accurate
reflection of the product for which the domestic industry is seeking
relief.\7\ On June 3 and 16, 2025, the petitioners provided
clarifications and revised the scope.\8\ The description of merchandise
covered by this investigation, as described in the appendix to this
notice, reflects these clarifications.
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\7\ See First General Issues Questionnaire; see also June 12,
2025, Memorandum.
\8\ See First General Issues Supplement at 2-4; see also Second
General Issues Supplement at 2-6.
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As discussed in the Preamble to Commerce's regulations, we are
setting aside a period for interested parties to raise issues regarding
product coverage (i.e., scope).\9\ Commerce will consider all scope
comments received from interested parties and, if necessary, will
consult with interested parties prior to the issuance of the
preliminary determination. If scope comments include factual
information, all such factual information should be limited to public
information.\10\ Commerce requests that interested parties provide at
the beginning of their scope comments a public executive summary for
each comment or issue raised in their submission. Commerce further
requests that interested parties limit their public executive summary
of each comment or issue to no more than 450 words, not including
citations. Commerce intends to use the public executive summaries as
the basis of the comment summaries included in the analysis of scope
comments. To facilitate preparation of its questionnaires, Commerce
requests that scope comments be submitted by 5:00 p.m. Eastern Time
(ET) on July 7, 2025, which is 20 calendar days from the signature date
of this notice. Any rebuttal comments, which may include factual
information, and should also be limited to public information, must be
filed by 5:00 p.m. ET on July 17, 2025, which is 10 calendar days from
the initial comment deadline.
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\9\ See Antidumping Duties; Countervailing Duties, Final Rule,
62 FR 27296, 27323 (May 19, 1997) (Preamble); see also 19 CFR
351.312.
\10\ See 19 CFR 351.102(b)(21) (defining ``factual
information'').
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Commerce requests that any factual information that parties
consider relevant to the scope of this investigation be submitted
during that period. However, if a party subsequently finds that
additional factual information pertaining to the scope of the
investigation may be relevant, the party must contact Commerce and
request permission to submit the additional information. All scope
comments must be filed simultaneously on the records of the concurrent
AD and CVD investigations.
Filing Requirements
All submissions to Commerce must be filed electronically via
Enforcement and Compliance's Antidumping Duty and Countervailing Duty
Centralized Electronic Service System (ACCESS), unless an exception
applies.\11\ An electronically filed document must be
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received successfully in its entirety by the time and date it is due.
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\11\ See Antidumping and Countervailing Duty Proceedings:
Electronic Filing Procedures; Administrative Protective Order
Procedures, 76 FR 39263 (July 6, 2011); see also Enforcement and
Compliance; Change of Electronic Filing System Name, 79 FR 69046
(November 20, 2014), for details of Commerce's electronic filing
requirements, effective August 5, 2011. Information on using ACCESS
can be found at https://access.trade.gov/help.aspx and a handbook
can be found at https://access.trade.gov/help/Handbook_on_Electronic_Filing_Procedures.pdf.
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Consultations
Pursuant to sections 702(b)(4)(A)(i) and (ii) of the Act, Commerce
notified the GOC of the receipt of the Petition and provided an
opportunity for consultations with respect to the Petition.\12\ The GOC
did not request consultations.
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\12\ See Commerce's Letter, ``Invitation for Consultations to
Discuss the Countervailing Duty Petition,'' dated May 28, 2025.
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Determination of Industry Support for the Petition
Section 702(b)(1) of the Act requires that a petition be filed on
behalf of the domestic industry. Section 702(c)(4)(A) of the Act
provides that a petition meets this requirement if the domestic
producers or workers who support the petition account for: (i) at least
25 percent of the total production of the domestic like product; and
(ii) more than 50 percent of the production of the domestic like
product produced by that portion of the industry expressing support
for, or opposition to, the petition. Moreover, section 702(c)(4)(D) of
the Act provides that, if the petition does not establish support of
domestic producers or workers accounting for more than 50 percent of
the total production of the domestic like product, Commerce shall: (i)
poll the industry or rely on other information in order to determine if
there is support for the petition, as required by subparagraph (A); or
(ii) determine industry support using a statistically valid sampling
method to poll the ``industry.''
Section 771(4)(A) of the Act defines the ``industry'' as the
producers as a whole of a domestic like product. Thus, to determine
whether a petition has the requisite industry support, the statute
directs Commerce to look to producers and workers who produce the
domestic like product. The U.S. International Trade Commission (ITC),
which is responsible for determining whether ``the domestic industry''
has been injured, must also determine what constitutes a domestic like
product in order to define the industry. While both Commerce and the
ITC must apply the same statutory definition regarding the domestic
like product,\13\ they do so for different purposes and pursuant to a
separate and distinct authority. In addition, Commerce's determination
is subject to limitations of time and information. Although this may
result in different definitions of the like product, such differences
do not render the decision of either agency contrary to law.\14\
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\13\ See section 771(10) of the Act.
\14\ See USEC, Inc. v. United States, 132 F. Supp. 2d 1, 8 (CIT
2001) (citing Algoma Steel Corp., Ltd. v. United States, 688 F.
Supp. 639, 644 (CIT 1988), aff'd Algoma Steel Corp., Ltd. v. United
States, 865 F.2d 240 (Fed. Cir. 1989)).
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Section 771(10) of the Act defines the domestic like product as ``a
product which is like, or in the absence of like, most similar in
characteristics and uses with, the article subject to an investigation
under this title.'' Thus, the reference point from which the domestic
like product analysis begins is ``the article subject to an
investigation'' (i.e., the class or kind of merchandise to be
investigated, which normally will be the scope as defined in the
petition).
With regard to the domestic like product, the petitioners do not
offer a definition of the domestic like product distinct from the scope
of the investigation.\15\ Based on our analysis of the information
submitted on the record, we have determined that lysine, as defined in
the scope, constitutes a single domestic like product, and we have
analyzed industry support in terms of that domestic like product.\16\
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\15\ For a discussion of the domestic like product analysis as
applied to this case and information regarding industry support, see
Checklist, ``Countervailing Duty Investigation Initiation Checklist:
L-lysine from the People's Republic of China,'' dated concurrently
with, and hereby adopted by, this notice (China CVD Initiation
Checklist), at Attachment II, Analysis of Industry Support for the
Antidumping and Countervailing Duty Petitions Covering L-lysine from
the People's Republic of China (Attachment II). This checklist is on
file electronically via ACCESS.
\16\ For further discussion, see Attachment II of the China CVD
Initiation Checklist.
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In determining whether the petitioners have standing under section
702(c)(4)(A) of the Act, we considered the industry support data
contained in the Petition with reference to the domestic like product
as defined in the ``Scope of the Investigation,'' in the appendix to
this notice. To establish industry support, the petitioners provided
their own production of the domestic like product in 2024 and compared
this to the estimated total production of the domestic like product in
2024 by the entire domestic industry.\17\ We relied on data provided by
the petitioners for purposes of measuring industry support.\18\
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\17\ For further discussion, see Attachment II of the China CVD
Initiation Checklist.
\18\ Id.
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Our review of the data provided in the Petition and other
information readily available to Commerce indicates that the
petitioners have established industry support for the Petition.\19\
First, the Petition established support from domestic producers (or
workers) accounting for more than 50 percent of the total production of
the domestic like product and, as such, Commerce is not required to
take further action in order to evaluate industry support (e.g.,
polling).\20\ Second, the domestic producers (or workers) have met the
statutory criteria for industry support under section 702(c)(4)(A)(i)
of the Act because the domestic producers (or workers) who support the
Petition account for at least 25 percent of the total production of the
domestic like product.\21\ Finally, the domestic producers (or workers)
have met the statutory criteria for industry support under section
702(c)(4)(A)(ii) of the Act because the domestic producers (or workers)
who support the Petition account for more than 50 percent of the
production of the domestic like product produced by that portion of the
industry expressing support for, or opposition to, the Petition.\22\
Accordingly, Commerce determines that the Petition was filed on behalf
of the domestic industry within the meaning of section 702(b)(1) of the
Act.\23\
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\19\ Id.
\20\ Id.; see also section 702(c)(4)(D) of the Act.
\21\ See Attachment II of the China CVD Initiation Checklist.
\22\ Id.
\23\ Id.
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Injury Test
Because China is a ``Subsidies Agreement Country'' within the
meaning of section 701(b) of the Act, section 701(a)(2) of the Act
applies to this investigation. Accordingly, the ITC must determine
whether imports of the subject merchandise from China materially
injure, or threaten material injury to, a U.S. industry.
Allegations and Evidence of Material Injury and Causation
The petitioners allege that imports of the subject merchandise are
benefiting from countervailable subsidies and that such imports are
causing, or threaten to cause, material injury to the U.S. industry
producing the domestic like product. In addition, the petitioners
allege that subject imports from China exceed the negligibility
threshold provided for under section 771(24)(A) of the Act.\24\
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\24\ For further information regarding negligibility and the
injury allegation, see China CVD Initiation Checklist at Attachment
III, Analysis of Allegations and Evidence of Material Injury and
Causation for the Antidumping and Countervailing Duty Petitions
Covering L-lysine from the People's Republic of China (Attachment
III).
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The petitioners contend that the industry's injured condition is
illustrated by a significant increase in the volume of subject imports;
reduced market share; underselling and price
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depression and/or suppression; lost sales and revenues; declines in
domestic producers' production, employment variables, and financial
performance; and underutilized capacity.\25\ We assessed the
allegations and supporting evidence regarding material injury, threat
of material injury, causation, as well as negligibility, and we have
determined that these allegations are properly supported by adequate
evidence, and meet the statutory requirements for initiation.\26\
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\25\ Id.
\26\ Id.
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Initiation of CVD Investigation
Based upon the examination of the Petition and supplemental
responses, we find that they meet the requirements of section 702 of
the Act. Therefore, we are initiating a CVD investigation to determine
whether imports of lysine from China benefit from countervailable
subsidies conferred by the GOC, respectively. In accordance with
section 703(b)(1) of the Act and 19 CFR 351.205(b)(1), unless
postponed, we will make our preliminary determination no later than 65
days after the date of this initiation.
Based on our review of the Petition, we find that there is
sufficient information to initiate a CVD investigation on all 25
programs alleged by the petitioners. For a full discussion of the basis
for our decision to initiate on each program, see the China CVD
Initiation Checklist. A public version of the initiation checklist for
this investigation is available on ACCESS.
Respondent Selection
In the Petition, the petitioners identified 113 companies in China
as producers and/or exporters of lysine.\27\ Commerce intends to follow
its standard practice in CVD investigations and calculate company-
specific subsidy rates in this investigation. In the event that
Commerce determines that the number of companies is large and it cannot
individually examine each company based on Commerce's resources,
Commerce normally selects mandatory respondents in CVD investigations
using U.S. Customs and Border Protection (CBP) entry data for U.S.
imports under the appropriate Harmonized Tariff Schedule of the United
States (HTSUS) subheading(s) listed in the ``Scope of the
Investigation,'' in the appendix.
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\27\ See Petition at Volume I (page 11 and Exhibit GEN-4); see
also First General Issues Supplement at 2 and Exhibit SUPP-GEN-4.
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On June 17, 2025, Commerce released CBP data on imports of lysine
from China under administrative protective order (APO) to all parties
with access to information protected by APO and indicated that
interested parties wishing to comment on CBP data and/or respondent
selection must do so within three business days of the publication date
of the notice of initiation of this investigation.\28\ Comments must be
filed electronically using ACCESS. An electronically filed document
must be received successfully in its entirety via ACCESS by 5:00 p.m.
ET on the specified deadline. Commerce will not accept rebuttal
comments regarding the CBP data or respondent selection. Interested
parties must submit applications for disclosure under APO in accordance
with 19 CFR 351.305(b). Instructions for filing such applications may
be found on Commerce's website at https://www.trade.gov/administrative-protective-orders.
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\28\ See Memorandum, ``Release of U.S. Customs and Border
Protection Entry Data,'' dated June 17, 2025.
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Distribution of a Copy of the Petition
In accordance with section 702(b)(4)(A) of the Act and 19 CFR
351.202(f), a copy of the public version of the Petition has been
provided to the GOC via ACCESS. To the extent practicable, we will
attempt to provide a copy of the public version of the Petition to each
exporter named in the Petition, as provided under 19 CFR 351.203(c)(2).
ITC Notification
Commerce will notify the ITC of its initiation, as required by
section 702(d) of the Act.
Preliminary Determination by the ITC
The ITC will preliminarily determine, within 45 days after the date
on which the Petition was filed, whether there is a reasonable
indication that imports of lysine from China are materially injuring,
or threatening material injury to, a U.S. industry.\29\ A negative ITC
determination will result in the investigation being terminated.\30\
Otherwise, this CVD investigation will proceed according to statutory
and regulatory time limits.
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\29\ See section 703(a)(1) of the Act.
\30\ Id.
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Submission of Factual Information
Factual information is defined in 19 CFR 351.102(b)(21) as: (i)
evidence submitted in response to questionnaires; (ii) evidence
submitted in support of allegations; (iii) publicly available
information to value factors of production under 19 CFR 351.408(c) or
to measure the adequacy of remuneration under 19 CFR 351.511(a)(2);
(iv) evidence placed on the record by Commerce; and (v) evidence other
than factual information described in (i)-(iv). Section 351.301(b) of
Commerce's regulations requires any party, when submitting factual
information, to specify under which subsection of 19 CFR 351.102(b)(21)
the information is being submitted \31\ and, if the information is
submitted to rebut, clarify, or correct factual information already on
the record, to provide an explanation identifying the information
already on the record that the factual information seeks to rebut,
clarify, or correct.\32\ Time limits for the submission of factual
information are addressed in 19 CFR 351.301, which provides specific
time limits based on the type of factual information being submitted.
Interested parties should review the regulations prior to submitting
factual information in this investigation.
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\31\ See 19 CFR 351.301(b).
\32\ See 19 CFR 351.301(b)(2).
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Extensions of Time Limits
Parties may request an extension of time limits before the
expiration of a time limit established under 19 CFR 351.301, or as
otherwise specified by Commerce. In general, an extension request will
be considered untimely if it is filed after the expiration of the time
limit established under 19 CFR 351.301, or as otherwise specified by
Commerce.\33\ For submissions that are due from multiple parties
simultaneously, an extension request will be considered untimely if it
is filed after 10:00 a.m. ET on the due date. Under certain
circumstances, Commerce may elect to specify a different time limit by
which extension requests will be considered untimely for submissions
which are due from multiple parties simultaneously. In such a case, we
will inform parties in a letter or memorandum of the deadline
(including a specified time) by which extension requests must be filed
to be considered timely. An extension request must be made in a
separate, standalone submission; under limited circumstances we will
grant untimely filed requests for the extension of time limits, where
we determine, based on 19 CFR 351.302, that extraordinary circumstances
exist. Parties should review Commerce's regulations concerning the
extension of time limits and the Time Limits Final Rule prior to
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submitting factual information in this investigation.\34\
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\33\ See 19 CFR 351.302.
\34\ See 19 CFR 351.301; see also Extension of Time Limits;
Final Rule, 78 FR 57790 (September 20, 2013) (Time Limits Final
Rule), available at https://www.gpo.gov/fdsys/pkg/FR-2013-09-20/html/2013-22853.htm.
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Certification Requirements
Any party submitting factual information in an AD or CVD proceeding
must certify to the accuracy and completeness of that information.\35\
Parties must use the certification formats provided in 19 CFR
351.303(g).\36\ Commerce intends to reject factual submissions if the
submitting party does not comply with the applicable certification
requirements.
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\35\ See section 782(b) of the Act.
\36\ See Certification of Factual Information to Import
Administration During Antidumping and Countervailing Duty
Proceedings, 78 FR 42678 (July 17, 2013) (Final Rule); see also
frequently asked questions regarding the Final Rule, available at
https://enforcement.trade.gov/tlei/notices/factual_info_final_rule_FAQ_07172013.pdf.
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Notification to Interested Parties
Interested parties must submit applications for disclosure under
APO in accordance with 19 CFR 351.305. Parties wishing to participate
in this investigation should ensure that they meet the requirements of
19 CFR 351.103(d) (e.g., by filing the required letters of appearance).
Note that Commerce has amended certain of its requirements pertaining
to the service of documents in 19 CFR 351.303(f).\37\
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\37\ See Administrative Protective Order, Service, and Other
Procedures in Antidumping and Countervailing Duty Proceedings, 88 FR
67069 (September 29, 2023).
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This notice is issued and published pursuant to sections 702 and
777(i) of the Act, and 19 CFR 351.203(c).
Dated: June 17, 2025.
Christopher Abbott,
Deputy Assistant Secretary for Policy and Negotiations, performing the
non-exclusive functions and duties of the Assistant Secretary for
Enforcement and Compliance.
Appendix
Scope of the Investigation
The scope of this investigation covers animal feed grade L-
lysine (lysine). Lysine is an essential amino acid added to animal
feed that is used in the biosynthesis of proteins. The scope covers
lysine regardless of form, including lysine monohydrochloride, also
referred to as lysine HCL, lysine sulfate, and liquid lysine. The
scope includes lysine that has been coated or encapsulated for use
with ruminants to ensure bioavailability.
Lysine HCL in the dry form has the molecular formula
C6H14N2O2HCl. The
Chemical Abstracts Service (CAS) registry number for lysine HCL is
657-27-2. Lysine HCL contains a minimum of 78 percent lysine by
weight, as well as additional amino acids, carbohydrates, mineral
salts, and organic acids. Lysine sulfate is the sulfate salt of
lysine, and in the dry form it has the molecular formula
C6H16N2O6S. The CAS
registry number for lysine sulfate is 60343-69-3. Lysine sulfate
typically contains approximately 40-70 percent lysine by weight, as
well as additional amino acids, carbohydrates, mineral salts, and
organic acids. Liquid lysine is a concentrated form of lysine in an
aqueous solution with the molecular formula
C6H14N2O2. The CAS
registry number for liquid lysine is 56-87-1. Liquid lysine normally
contains at least 50 percent lysine by weight, as well as additional
amino acids, carbohydrates, mineral salts, and organic acids.
The scope includes animal feed grade lysine that is combined
with other products, including for example, by mixing, blending,
compounding, or granulating (e.g., base mixes, premixes, and
concentrates). For such combined products, only the lysine component
is covered by the scope of this investigation.
Subject merchandise also includes lysine that has been processed
in a third country, including by commingling, diluting, adding or
removing additives, refining, converting from liquid to dry or dry
to liquid form, coating or encapsulating, or performing any
processing that would not otherwise remove the merchandise from the
scope of the investigation if performed in the subject country.
The merchandise covered by this investigation is properly
classified under Harmonized Tariff Schedule of the United States
(HTSUS) subheading 2922.41.0090. Lysine may also be classified under
HTSUS subheadings 2922.41.0010, 2922.49.4950, 2309.90.7000, and
2309.90.9500. Although the HTSUS subheadings and the CAS registry
numbers are provided for convenience and customs purposes, the
written description of the scope of the investigation is
dispositive.
[FR Doc. 2025-11537 Filed 6-23-25; 8:45 am]
BILLING CODE 3510-DS-P