Preliminary Determination of Sales at Less Than Fair Value: Silicomanganese From the People's Republic of China

DEPARTMENT OF COMMERCE

(A-570-828)

Preliminary Determination of Sales at Less Than Fair Value:

Silicomanganese From the People's Republic of China

AGENCY: Import Administration, International Trade Administration,

Department of Commerce

EFFECTIVE DATE: June 17, 1994.

FOR FURTHER INFORMATION CONTACT: Steve Alley or Mike Ready, Office of

Antidumping Investigations, Import Administration, International Trade

Administration, U.S. Department of Commerce, 14th Street and

Constitution Avenue NW., Washington, D.C. 20230; telephone: (202) 482-

5288 or (202) 482-2613, respectively.

Preliminary Determination

We preliminarily determine that silicomanganese from the People's

Republic of China (PRC) is being, or is likely to be, sold in the

United States at less than fair value, as provided in section 733 of

the Tariff Act of 1930, as amended (the Act). The estimated margin is

shown in the ``Suspension of Liquidation'' section of this notice.

Case History

Since the initiation of this investigation on December 2, 1993, (58

FR 64553, December 8, 1993), the following events have occurred:

On December 27, 1993, the U.S. International Trade Commission (ITC)

notified us of its preliminary determination that there is a reasonable

indication that an industry in the United States is being materially

injured, or threatened with material injury, by reason of imports of

silicomanganese from the PRC that are alleged to be sold at less than

fair value.

On January 6, 1994, the Department of Commerce (the Department)

sent antidumping questionnaires to 18 producers and exporters that may

have sold silicomanganese to the United States during the period of

investigation (POI). Company names and addresses were either obtained

from the petition or from the Census Bureau's IM-115 data. In the

accompanying cover letter, the Department requested that companies

without U.S. sales during the POI advise the Department of this fact.

Also, on January 6, 1994, the Department sent a copy of the

antidumping questionnaire to the PRC's Ministry of Foreign Trade and

Economic Cooperation (MOFTEC). In our transmittal letter, the

Department requested MOFTEC to 1) furnish the questionnaire to any

silicomanganese producers and exporters with U.S. sales during the POI

that were not on our list of 18 companies, and 2) provide a

comprehensive list of those additional companies that received the

questionnaire from MOFTEC. On April 12, 1994, the Department sent a

second letter to MOFTEC again requesting a list of all companies that

had received the questionnaire from MOFTEC.

MOFTEC did not respond to either letter, and most of the potential

respondents neither replied to our questionnaire nor notified us that

they had not made any sales to the United States during the POI. The

only two companies that did respond to our questionnaire, Jinzhou

Ferroalloy Works (Jinzhou), a PRC producer of silicomanganese, and

Bogay Investment, Ltd. (Bogay), a Hong Kong company that purchased

silicomanganese from Jinzhou and exported it directly to the United

States, reported one sale made four months prior to the POI. Although,

as noted above, the cover letter accompanying the questionnaire stated

that companies with no sales of the subject merchandise during the POI

need only notify us of this fact, Jinzhou and Bogay chose to respond to

the questionnaire. Bogay submitted its questionnaire responses on

February 14 and February 28, 1994, and Jinzhou submitted its

questionnaire responses on March 7 and March 23, 1994.

On March 2, 1994, the Department determined that this investigation

was extraordinarily complicated. Therefore, in accordance with section

733(c)(1)(B) of the Act, the Department postponed the preliminary

determination until June 10, 1994. (See Notice of Postponement of

Preliminary Antidumping Duty Determination: Silicomanganese from the

PRC and Ukraine, 59 FR 11250, March 10, 1994.)

On May 20, 1994, counsel for petitioners alleged the existence of

critical circumstances. The Department has investigated whether

critical circumstances exist, and our preliminary results are listed

below under ``Critical Circumstances.''

The Department determined on May 23, 1994, not to expand the POI to

include Jinzhou and Bogay in the investigation (see Memorandum from

Richard W. Moreland to Barbara R. Stafford, dated May 23, 1994).

Scope of Investigation

The merchandise covered by this investigation is silicomanganese.

Silicomanganese, which is sometimes called ferrosilicon manganese, is a

ferroalloy composed principally of manganese, silicon, and iron, and

normally containing much smaller proportions of minor elements, such as

carbon, phosphorous and sulfur. Silicomanganese generally contains by

weight not less than 4% iron, more than 30% manganese, more than 8%

silicon and not more than 3% phosphorous. All compositions, forms and

sizes of silicomanganese are included within the scope of these

investigations, including silicomanganese slag, fines and briquettes.

Silicomanganese is used primarily in steel production as a source of

both silicon and manganese. These investigations cover all

silicomanganese, regardless of its tariff classification. Most

silicomanganese is currently classifiable under subheading 7202.30.0000

of the Harmonized Tariff Schedule of the United States (HTS). Some

silicomanganese may also be classifiable under HTS subheading

7202.99.5040. Although the HTS subheading is provided for convenience

and customs purposes, our written description of the scope is

dispositive.

Period of Investigation

The period of investigation is June 1, 1993, through November 30,

1993.

Best Information Available

U.S. Customs shipment data suggest that there were sales of subject

merchandise during the POI. Because MOFTEC and most of the potential

respondents failed to provide information concerning whether there were

such sales, the Department, in accordance with section 776(c) of the

Act, must base its preliminary determination on best information

available (BIA).

In determining what to use as BIA, the Department follows a two-

tiered methodology, whereby the Department normally assigns lower

margins to those respondents who cooperate in an investigation and

margins based on more adverse assumptions for those respondents who do

not cooperate in an investigation. Since the potential respondents in

this case did not cooperate, we assigned a BIA margin based on the most

adverse assumptions.

In this case, BIA is the information contained in the petition, as

amended on November 24, 1993. (See Initiation of Antidumping Duty

Investigations: Silicomanganese from Brazil, the People's Republic of

China, Ukraine and Venezuela, 58 FR 64553, December 8, 1993.) The

amended petition provides only one margin, listed below, for all PRC

producers and exporters of silicomanganese.

Critical Circumstances

Petitioner alleges that critical circumstances exist with respect

to imports of silicomanganese from the PRC. Pursuant to section

733(e)(1) of the Act and 19 CFR 353.16, we analyzed the allegations

using the Department's standard methodology.

To find critical circumstances, the Department must determine

whether there is a reasonable basis to believe or suspect that 1) there

is a history of dumping in the United States or elsewhere of the same

class or kind of subject merchandise, or the importer knew or should

have known that the producer or reseller was selling the subject

merchandise at less than its foreign market value; and 2) there have

been massive imports of the subject merchandise over a relatively short

period.

We have not found a history of dumping of PRC silicomanganese in

the United States or elsewhere. According to Department practice,

however, we will impute knowledge of dumping to importers of subject

merchandise when the dumping margin exceeds 25 percent in purchase

price situations (see Preliminary Determination on Silicon Carbide from

the PRC, 58 FR 64549, December 8, 1993). In this case, the estimated

dumping margin for silicomanganese imports from the PRC is 150.00

percent.

We consider imports of merchandise under investigation to be

massive if there has been an increase of 15 percent or more over a

relatively short period of time. For the preliminary determination, we

were able to obtain import data through the month of March. To

determine whether there have been massive imports of silicomanganese

from the PRC, we compared the import volume for the month in which the

petition was filed, November, and the four months subsequent to that

month with the import volume for the five months prior to the filing of

the petition, using Department of Commerce shipment data. We found that

the import volume of silicomanganese during the period subsequent to

the filing of the petition was massive, increasing by 426.83 percent

over the previous period's import volume.

For the foregoing reasons, the Department preliminarily finds that

critical circumstances exist in this case.

Suspension of Liquidation

In accordance with section 733(d)(1) of the Act, we are directing

the Customs Service to suspend liquidation of all entries of

silicomanganese from the PRC that are entered, or withdrawn from

warehouse, for consumption on or after the date 90 days before the date

of publication of this notice in the Federal Register. The Customs

Service shall require a cash deposit or posting of a bond equal to the

amount shown below. These suspension of liquidation instructions will

remain in effect until further notice.

------------------------------------------------------------------------

Weighted-

average

Manufacturer/producer/exporter margin

percentage

------------------------------------------------------------------------

All exporters............................................... 150.00

------------------------------------------------------------------------

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 before the later of 120 days after the date of

this preliminary determination or 45 days after our final determination

whether these imports are materially injuring, or threaten material

injury to, the U.S. industry.

Public Comment

Interested parties who wish to request a hearing must submit a

written request to the Assistant Secretary for Import Administration,

U.S. Department of Commerce, Room B-099, within ten days of the

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 the issues to be discussed.

In accordance with 19 CFR 353.38, case briefs or other written

comments in at least ten copies must be submitted to the Assistant

Secretary for Import Administration no later than July 13, 1994, and

rebuttal briefs no later than July 18, 1994. A public hearing, if

requested, will be held on July 20, 1994 at 2:00 p.m. at the U.S.

Department of Commerce, Room 1414, 14th Street and Constitution Avenue,

NW., Washington, DC 20230. Parties should confirm by telephone the

time, date, and place of the hearing 48 hours before the scheduled

time. In accordance with 19 CFR 353.38(b), oral presentations will be

limited to issues raised in the briefs.

We will make our final determination not later than 75 days after

publication of this determination in the Federal Register.

This determination is published pursuant to section 733(f) of the

Act, and 19 CFR 353.15(a)(4).

Dated: June 10, 1994.

Susan G. Esserman,

Assistant Secretary for Import Administration.

[FR Doc. 94-14849 Filed 6-16-94; 8:45 am]

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