Gray Portland Cement and Clinker From Japan; Preliminary Results of Antidumping Duty Administrative Review

DEPARTMENT OF COMMERCE

[A-588-815]

Gray Portland Cement and Clinker From Japan; Preliminary Results

of Antidumping Duty Administrative Review

AGENCY: Import Administration, International Trade Administration,

Department of Commerce.

ACTION: Notice of Preliminary Results of Antidumping Duty

Administrative Review.

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SUMMARY: In response to a request from the Ad Hoc Committee of Southern

California Producers of Gray Portland Cement (the petitioner) and Onoda

Cement Company, Ltd. (the respondent), the Department of Commerce (the

Department) is conducting an administrative review of the antidumping

duty order on gray portland cement and clinker from Japan. The review

covers one manufacturer/exporter, Onoda Cement Co., Ltd. (Onoda), and

the period May 1, 1993, through April 30, 1994 (POR). The review

indicates the existence of dumping margins during this period.

We have preliminarily determined that sales have been made below

the foreign market value (FMV). If these preliminary results are

adopted in our final results of administrative review, we will instruct

the U.S. Customs Service (Customs) to assess antidumping duties equal

to the difference between the United States price (USP) and FMV.

Interested parties are invited to comment on these preliminary results.

[[Page 52369]]

EFFECTIVE DATE: October 6, 1995.

FOR FURTHER INFORMATION CONTACT: Amy S. Wei or Zev Primor, Office of

Antidumping Compliance, Import Administration, International Trade

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

Constitution Avenue, N.W., Washington, D.C. 20230; telephone (202) 482-

5253.

SUPPLEMENTARY INFORMATION:

Background

On May 4, 1994, the Department published a notice of ``Opportunity

to Request an Administrative Review'' (59 FR 23051) of the antidumping

duty order on gray portland cement and clinker from Japan (56 FR 21658,

May 10, 1991). On May 12, 1994, and May 31, 1994, requests were

submitted by the respondent and petitioner, respectively, for the

Department to conduct an administrative review of the antidumping duty

order on gray portland cement and clinker from Japan for Onoda. We

initiated the review, covering the period May 1, 1993, through April

30, 1994, on June 15, 1994 (59 FR 30770). The Department is conducting

this review in accordance with section 751 of the Tariff Act of 1930,

as amended (the Act).

Scope of the Review

The products covered by this review are gray portland cement and

clinker from Japan. Gray portland cement is a hydraulic cement and the

primary component of concrete. Clinker, an intermediate material

produced when manufacturing cement, has no use other than grinding into

finished cement. Microfine cement was specifically excluded from the

antidumping duty order. Gray portland cement is currently classifiable

under the Harmonized Tariff Schedule (HTS) item number 2523.29, and

clinker is currently classifiable under HTS item number 2523.10. Gray

portland cement has also been entered under item number 2523.90 as

``other hydraulic cements''.

The HTS item numbers are provided for convenience and Customs

purposes. The written product description remains dispositive as to the

scope of the product coverage.

This review covers Onoda and the period May 1, 1993 through April

30, 1994.

Applicable Statute and Regulations

Unless otherwise indicated, all citations to the statute and to the

Department's regulations are references to the provisions as they

existed on December 31, 1994.

Product Comparisons

Product comparisons were made on the basis of standards established

by the American Society for Testing and Materials (ASTM standards). All

of the cement sold in the United States fell within one ASTM standard,

Type I. Onoda provided documents indicating the chemical composition,

technical specifications, and uses for each cement type sold in the

home market during the period of review.

Based on information submitted on the record and our findings at

verification, we have determined that Type N cement, which is sold in

the home market, is the closest comparable model to Type I cement,

given the similar general chemical compositions and uses.

Onoda made no sales of clinker in the United States during the

period of review.

Use of Best Information Available

At verification, we were unable to substantiate Onoda's short-term

interest rates. As a result, in accordance with section 776(c) of the

Act, we are using best information available (BIA) for Onoda's home

market credit expense. As BIA, we used the lowest short-term interest

rate reported by Onoda in its questionnaire response for the POR. We

multiplied this rate by the number of days between the dates of payment

and shipment and divided by 365 days for each home market sale. This

amount was then multiplied by the gross unit price reported for each

sale in order to calculate credit expense.

United States Price

In calculating USP, the Department used purchase price sales, as

defined in section 772(b) of the Act. We made adjustments, where

appropriate, for loading costs, ocean freight, marine insurance,

customs user fees and harbor fees, interest revenue, credit, and

document handling fees. The Department also made an adjustment to the

amount of taxes included in USP in accordance with the Department's tax

adjustment methodology (see Preliminary Determination of Sales at Less

Than Fair Value and Postponement of Final Determination:

Silicomanganese from Venezuela, 59 FR 31204, June 17, 1994).

Foreign Market Value

In calculating FMV, we used home market price, as defined in

section 773(a) of the Act. Home market price was based on FOB, CIF

terminal, pick-up, or delivered prices to related and unrelated

customers in the home market. We did not include those home market

sales to those related parties which were not made at arm's length

prices. In order to determine whether these sales were made at arm's-

length prices, we calculated a weighted-average price of all of Onoda's

sales to unrelated customers. We compared this price to a weighted-

average price of the home market sales for each related party. Where

the weighted-average price charged to a related party was less than the

weighted-average price charged to all of Onoda's unrelated customers,

we determined that those related party sales were not made at arm's-

length prices, and removed those sales from our FMV calculation.

Due to the existence of sales below the cost of production (COP) in

a previous administrative review, the Department had reasonable grounds

to believe or suspect that sales below the COP may have occurred during

this review, as explained in section 773(b)(2)(A)(ii) of the Act.

Therefore, in accordance with section 773(b)(1) of the Act, the

Department initiated a COP investigation for this review. We calculated

COP based on Onoda's reported cost of manufacturing, selling expenses,

general and administrative expenses, and net interest expense, as

defined in 19 CFR 353.51(c). We compared COP to home market prices, net

of movement charges, price adjustments, and discounts.

The results of our cost test indicated that more than 10 percent

but less than 90 percent of home market sales were below the COP,

indicating that the below-cost sales were made in substantial

quantities. In addition, we determined that the below-cost sales were

made over an extended period of time, since these sales occurred in

more than two months of the review period. Furthermore, no evidence was

presented to indicate that below-cost COP prices would permit the

recovery of all costs within a reasonable period of time in the normal

course of trade. Thus, we dropped from our calculation of FMV all home

market sales that were made below the COP.

Using the remaining sales for calculating the FMV used in the

dumping calculation, we made adjustments, where appropriate, for

credit, interest revenue, packing, post-sale freight costs, and all

rebates and discounts. The Department also made an adjustment to the

amount of consumption taxes included in FMV in accordance with the

Department's aforementioned tax adjustment methodology. In accordance

with 19 CFR 353.56(b)(1), we offset commissions paid in the home market

with indirect selling expenses from the U.S. market

[[Page 52370]]

since no sales commissions were paid in the U.S. market. In addition,

Onoda was unable to provide dates of payment for some home market

sales, since Onoda claimed that it had not received payment for these

sales by the time the home market sales tape was created. As a result,

we have calculated the weighted-average number of days between the

dates of shipment and the dates of payment for those home market sales

where the dates of payment were reported. We added this weighted-

average number of days to the shipment dates of those home market sales

with missing dates of payment. We then used these dates as the dates of

payment for these sales.

The Department did not deduct pre-sale transportation costs, in

accordance with the United States Court of Appeals for the Federal

Circuit's ruling in The Ad Hoc Committee of AZ-NM-TX-FL Producers of

Gray Portland Cement v. United States, 13 F.3d 398 (Fed. Cir. 1994).

This decision allows us to deduct pre-sale transportation costs from

FMV only if these expenses are directly related to the home market

sales, in accordance with 19 CFR 353.56(a). In order to determine

whether pre-sale transportation costs are direct, the Department

examines pre-sale warehousing expenses, since the pre-sale

transportation costs incurred in positioning the merchandise at the

warehouse are, for analytical purposes, inextricably linked to the pre-

sale warehousing expenses. Since Onoda reported that it incurred no

after-sale warehousing expenses and did not claim any warehousing

expenses as direct circumstance-of-sale adjustments in its

questionnaire responses, we determined that Onoda's warehousing

expenses were pre-sale, indirect selling expenses. Then, in the absence

of contrary evidence, pre-sale transportation costs were also treated

as indirect expenses (see Gray Portland Cement and Clinker From Japan;

Final Results of Antidumping Duty Administrative Review, 60 FR 43761,

43766, Comment 9, August 23, 1995).

Where appropriate, we made further adjustments to FMV to account

for differences in physical characteristics of the merchandise, in

accordance with 19 CFR 353.57 of the Department's regulations.

Preliminary Results of Review

As a result of our comparison of USP to FMV, the Department

preliminarily determines that a margin of 28.32 percent exists for

Onoda for the period May 1, 1993, through April 30, 1994.

Parties to the proceeding may request disclosure within 5 days of

the date of publication of this notice and any interested party may

request a hearing within 10 days of publication. Any hearing, if

requested, will be held 44 days after the date of publication of this

notice, or the first workday thereafter and will be limited to those

issues raised in the case briefs and/or written comment. Case briefs

and/or written comments from interested parties may be submitted not

later than 30 days after the date of publication. Rebuttal briefs and

rebuttals to written comments, limited to the issues raised in the case

briefs and comments, may be filed not later than 37 days after the date

of publication. The Department will publish the final results of this

administrative review, including the results of its analysis of any

written comments or case briefs.

The Department shall determine, and Customs shall assess,

antidumping duties on all appropriate entries. Individual differences

between USP and FMV may vary from the percentage stated above. The

Department will issue appraisement instructions directly to the

Customs.

Furthermore, the following deposit requirements will be effective

for all shipments of the subject merchandise, entered or withdrawn from

warehouse, for consumption on or after the publication date of the

final results of this administrative review, as provided by section

751(a)(1) of the Act: (1) the cash deposit rate for Onoda will be the

rate established in the final results of this administrative review;

(2) for merchandise exported by manufacturers or exporters not covered

in this review but covered in a previous review or the original less-

than-fair-value (LTFV) investigation, the cash deposit rate will

continue to be the rate published in the most recent final results or

determination for which the manufacturer or exporter received a

company-specific rate; (3) if the exporter is not a firm covered in

this review, earlier reviews, or the original investigation, but the

manufacturer is, the cash deposit rate will be that established for the

manufacturer of the merchandise in these final results of review,

earlier reviews, or the original investigation, whichever is the most

recent; and (4) the ``all others'' rate will be 70.23 percent, as

specified in the final results of redetermination pursuant to court

remand (60 FR 24832, May 10, 1995).

These deposit requirements, when imposed, shall remain in effect

until publication of the final results of the next administrative

review.

This notice also serves as a preliminary reminder to importers of

their responsibility under 19 CFR 353.26 to file a certificate

regarding the reimbursement of antidumping duties prior to liquidation

of the relevant entries during this review period. Failure to comply

with this requirement could result in the Secretary's presumption that

reimbursement of antidumping duties occurred and the subsequent

assessment of double antidumping duties.

This notice also serves as a preliminary reminder to parties

subject to administrative protective orders (APOs) of their

responsibility concerning the disposition of proprietary information

disclosed under APO in accordance with 19 CFR 353.34(d). Timely written

notification of the return/destruction of APO materials or conversion

to judicial protective order is hereby requested. Failure to comply

with the regulations and terms of an APO is a sanctionable violation.

This administrative review and notice are in accordance with

section 751(a)(1) of the Act (19 U.S.C. 1675(a)(1)) and 19 CFR 353.22.

Dated: September 27, 1995.

Paul L. Joffe,

Deputy Assistant Secretary for Import Administration.

[FR Doc. 95-24926 Filed 10-5-95; 8:45 am]

BILLING CODE 3510-DS-P