[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]
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