Stainless Steel Bar From India: Preliminary Results of Antidumping Duty Administrative Review and Partial Termination of Administrative Review

DEPARTMENT OF COMMERCE

International Trade Administration

[A-533-810]

Stainless Steel Bar From India: Preliminary Results of

Antidumping Duty Administrative Review and Partial Termination of

Administrative Review

AGENCY: Import Administration, International Trade Administration,

Department of Commerce.

ACTION: Notice of preliminary results of antidumping duty

administrative review: Stainless Steel Bar from India.

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SUMMARY: In response to requests from Mukand Limited (``Mukand'') and

Ferro Alloys Corporation Limited (``Facor''), the Department of

Commerce (``the Department'') is conducting an administrative review of

the antidumping duty order on stainless steel bar from India. This

review covers Mukand's sales of the subject merchandise to the United

States during the period February 1, 1996 through January 31, 1997.

Although we included Facor in our initiation notice for this

review, we subsequently initiated a new shipper review, covering the

same review period, for that company. Consequently, we are terminating

this review with respect to Facor.

We have preliminarily determined that Mukand's sales have been made

below normal value (``NV''). If these preliminary results are adopted

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

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

difference between the export price (EP) and the normal value (NV).

Interested parties are invited to comment on these preliminary

results. Parties who submit argument are requested to submit with the

argument (1) a statement of the issue and (2) a brief summary of the

argument.

EFFECTIVE DATE: November 10, 1997.

FOR FURTHER INFORMATION CONTACT: Jennifer Yeske or Craig Matney, Office

1, Import Administration, International Trade Administration, U.S.

Department of Commerce, 14th Street and Constitution Avenue, N.W.,

Washington D.C. 20230; telephone (202) 482-0189 or (202) 482-0588,

respectively.

Applicable Statute

Unless otherwise indicated, all citations to the statute are

references to the provisions effective January 1, 1995, the effective

date of the amendments made to the Tariff Act of 1930 (``the Act'') by

the Uruguay Round Agreements Act.

SUPPLEMENTARY INFORMATION:

Background

On February 24, 1997, the Department received a request from

respondents to conduct an administrative review of the antidumping duty

order on stainless steel bar from India produced by Mukand. The

Department published in the Federal Register, on March 18, 1997, a

notice of initiation of an administrative review of Mukand covering the

period February 1, 1996 through January 31, 1997 (62 FR 12793).

Scope of Review

Imports covered by this review are shipments of stainless steel bar

(``SSB''). SSB means articles of stainless steel in straight lengths

that have been either hot-rolled, forged, turned, cold-drawn, cold-

rolled or otherwise cold-finished, or ground, having a uniform solid

cross section along their whole length in the shape of circles,

segments of circles, ovals, rectangles (including squares), triangles,

hexagons, octagons, or other convex polygons. SSB includes cold-

finished SSBs that are turned or ground in straight lengths, whether

produced from hot-rolled bar or from straightened and cut rod or wire,

and reinforcing bars that have indentations, ribs, grooves, or other

deformations produced during the rolling process.

Except as specified above, the term does not include stainless

steel semi-finished products, cut length flat-rolled products (i.e.,

cut length rolled products which if less than 4.75 mm in thickness have

a width measuring at least 10 times the thickness, or if 4.75 mm or

more in thickness having a width which exceeds 150 mm and measures at

least twice the thickness), wire (i.e., cold-formed products in coils,

of any uniform solid cross section along their whole length, which do

not conform to the definition of flat-rolled products), and angles,

shapes and sections.

The SSB subject to these orders is currently classifiable under

subheadings 7222.10.0005, 7222.10.0050, 7222.20.0005, 7222.20.0045,

7222.20.0075, and 7222.30.0000 of the Harmonized Tariff Schedule of the

United States (``HTSUS''). Although the HTSUS subheadings are provided

for convenience and customs purposes, our written description of the

scope of this order is dispositive.

Period of Review

This review covers one manufacturer/exporter, Mukand, and the

period February 1, 1996 through January 31, 1997.

Partial Termination of Review

Facor was included in our notice of initiation of this review

because we received a request for an administrative review of that

company. However, Facor also submitted a timely request for a new

shipper review covering the same period. On March 28, 1997, we

published a notice of initiation of a new shipper administrative review

covering Facor for the same review period (see 62 FR 14886). Therefore,

we are terminating this review with respect to Ferro Alloys Corporation

Limited.

Verification

As provided in section 782(i) of the Act, we verified information

provided by the respondent by using standard verification procedures,

including on-site inspection of the respondent's facilities, the

examination of appropriate sales and financial records, and selection

of original documentation containing relevant information. Our

verification results are outlined in the public version of the

verification report.

United States Price

In calculating price to the United States, we used export price

(``EP''), in accordance with section 772(a) of the Act, because the

subject merchandise was sold directly to the first unaffiliated

purchaser in the United States prior to importation into the United

States and constructed export price was not otherwise indicated.

We calculated EP based on the price from Mukand to an unaffiliated

customer prior to importation into the United States. In accordance

with section 772(c)(2) of the Act, we made deductions for foreign

inland freight and international freight.

Mukand claimed an upward adjustment to EP for a ``duty drawback''

scheme. In the preliminary determination of the first administrative

review of this order (see 62 FR 10540 at 10541, March 7, 1997), we

analyzed the functioning of this duty drawback scheme and found that it

did not meet the Department's standards for an upward adjustment to EP.

We maintained our position in the final determination (see 62 FR 37030,

July 10, 1997). We have reexamined the scheme in regard to Mukand, and

have found no basis on which to deviate from the Department's previous

decision. Therefore, we have not made an adjustment to EP. However, for

those sales for which CV is the basis for NV, we have offset the per

unit direct materials cost to account for the credits (see Normal Value

section).

[[Page 60483]]

Normal Value

In order to determine whether there was a sufficient volume of

sales in the home market to serve as a viable basis for calculating NV,

we compared respondent's volume of home market sales of the foreign

like product to the volume of U.S. sales of the subject merchandise, in

accordance with section 773(a) of the Act. Because the aggregate volume

of home market sales of the foreign like product was greater than five

percent of the aggregate volume of U.S. sales of the subject

merchandise, we determined that the home market provides a viable basis

for calculating NV. Therefore, in accordance with section

773(a)(1)(B)(i) of the Act, we based NV on the prices at which the

foreign like product was first sold to unaffiliated customers for

consumption in the exporting country, in the usual commercial

quantities and in the ordinary course of trade. Respondent claimed that

there is no difference in the level of trade between the U.S. and the

home markets. We examined the data submitted regarding the channels of

distribution and selling expenses in the two markets. While there are

different channels of distribution, many of the selling expenses are

consistent across all channels. While there may be some additional

expenses in the home market for the Del Credre and consignment sales,

respondent did not claim an adjustment or provide information

supporting such an adjustment.

Based on a cost allegation presented by petitioners, the Department

found reasonable grounds to believe or suspect that sales by the

respondent in the home market were made at the prices below their

respective costs of production (``COPs''). As a result, the Department

initiated an investigation to determine whether the respondent made

home market sales during the POR at prices below its COP, within the

meaning of section 773(b) of the Act.

We calculated COP as the sum of the respondent's cost of materials,

labor and overhead for the foreign like product, plus amounts for G&A

and packing costs, in accordance with section 773(b)(3) of the Act. We

compared COP to home market sales of the foreign like product, as

required under section 773(b) of the Act, in order to determine whether

these sales had been made at prices below COP. On a product-specific

basis, we compared COP to the home market prices, less any applicable

movement charges, discounts, commissions, selling expenses and packing

expenses.

In determining whether to disregard home market sales made at

prices below the COP, we examined whether: (1) Within an extended

period of time, such sales were made in substantial quantities; and (2)

such sales were made at prices which permitted recovery of all costs

within a reasonable period of time in the normal course of trade. Where

20 percent or more of a respondent's sales of a given product during

the POR were at prices below COP, we found that below cost sales of

that model were made in ``substantial quantities'' within an extended

period of time, in accordance with section 773(b)(2) (B) and (C). To

determine whether prices provided for recovery of costs within a

reasonable period of time, we tested whether the prices that were below

the per unit cost of production at the time of the sale were above the

weighted average per unit cost of production for the POR, in accordance

with section 773(b)(2)(D). Where we found that a substantial quantity

of sales during the POR were below cost and not at prices that provided

for recovery of costs within a reasonable period of time, we

disregarded the below cost sales.

Where NV was calculated using prices to unaffiliated customers, we

made appropriate adjustments to those prices. First, we deducted home

market inland freight and home market packing costs. Where there were

differences in the merchandise to be compared, we made adjustments in

accordance with section 773(a)(6)(C)(ii) of the Act to account for

those differences. We also added U.S. packing costs in accordance with

section 773(a)(6)(A) of the Act. We also made circumstance-of-sale

adjustments for differences in credit costs and bank charges between

the two markets in accordance with section 773(a)(6)(C)(iii) of the

Act. Finally, we adjusted for commissions paid in the home market by

deducting the commissions from the NV and offsetting the commissions

with indirect selling expenses incurred on sales to the United States,

up to the amount of the home market commission.

Where there was no above cost home market sale for comparison, NV

was based on CV. In accordance with section 773(e)(1) of the Act, we

calculated CV based on the sum of respondent's cost of materials (net

of import duty credits earned on its U.S. sale), labor, overhead, SG&A,

profit, and U.S. packing costs. In accordance with section 773(e)(2)(A)

of the Act, we based SG&A expenses and profit on the amounts incurred

and realized by the respondent in connection with the production and

sale of the foreign like product in the ordinary course of trade, for

consumption in the foreign country.

Preliminary Results of the Review

As a result of our comparison of EP and NV, we preliminarily

determine the following weighted-average dumping margin:

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

Margin

Manufacturer/exporter Period (percent)

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Mukand.................................... 2/1/96-1/31/97 8.38

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Parties to the proceeding may request disclosure within five days

of the date of publication of this notice. Any interested party may

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

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

or the first workday thereafter. Interested parties may submit case

briefs within 30 days of the date of publication of this notice.

Rebuttal briefs, which must be limited to issues raised in the case

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

publication of this notice. The Department will issue the final results

of this administrative review, which will include the results of its

analysis of issues raised in any such comments, within 120 days of

publication of these preliminary results.

Upon completion of this administrative review, the Department shall

determine, and the U.S. Customs Service shall assess, antidumping

duties on all appropriate entries. Individual differences between EP

and NV may vary from the percentages stated above. We have calculated

an importer-specific duty assessment rate based on the ratio of the

total amount of AD duties calculated for the examined sales made during

the POR to the total value of subject merchandise entered during the

POR. In order to estimate the entered value, we subtracted

international movement expenses (e.g., international freight) from the

gross sales value. This rate will be assessed uniformly on all entries

made during the POR. The Department will issue appraisement

instructions directly to the Customs Service.

The following deposit requirement will be effective upon

publication of the final results of this antidumping duty

administrative review for all shipments of stainless steel bar from

India entered, or withdrawn from warehouse, for consumption on or after

the publication date, as provided for by section 751(a)(1) of the Act:

(1) The cash deposit rate for the reviewed company will be the rate

established in the final results of this review; (2) if the exporter is

not a firm covered in this review, but was

[[Page 60484]]

covered in a previous review or the original less-than-fair-value

(``LTFV'') investigation, the cash deposit rate will continue to be the

company-specific rate published for the most recent period; (3) if the

exporter is not a firm covered in this review, a previous review, or

the original LTFV investigation, but the manufacturer is, the cash

deposit rate will be the rate established for the most recent period

for the manufacturer of the merchandise; and (4) the cash deposit rate

for all other manufacturers and/or exporters of this merchandise, shall

be 12.45 percent, the ``all others'' rate established in the LTFV

investigation (59 FR 66915, December 28, 1994).

These 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 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(c).

Dated: October 31, 1997.

Robert S. LaRussa,

Assistant Secretary for Import Administration.

[FR Doc. 97-29627 Filed 11-7-97; 8:45 am]

BILLING CODE 3510-DS-P