[Federal Register Volume 75, Number 114 (Tuesday, June 15, 2010)]
[Notices]
[Pages 33779-33782]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-14371]
[[Page 33779]]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-489-815]
Light-Walled Rectangular Pipe and Tube from Turkey; Notice of
Preliminary Results of Antidumping Duty Administrative Review
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
SUMMARY: In response to requests from Toscelik Profil ve Sac Endustrisi
A.S., and Tosyali Dis Ticaret A.S., (``collectively, Toscelik'') the
Department of Commerce (``the Department'') is conducting an
administrative review of the antidumping duty order on light-walled
rectangular pipe and tube from Turkey. Atlas Tube, Inc. and Searing
Industries, Inc. are petitioners in this case. The review covers
exports of the subject merchandise to the United States produced and
exported by Toscelik. The period of review (``POR'') is January 30,
2008, through April 30, 2009.
We preliminarily find that Toscelik did not make sales at less than
normal value (``NV'') during the POR. If these preliminary results are
adopted in our final results of this review, we will instruct U.S.
Customs and Border Protection (``CBP'') not to assess antidumping
duties on entries made by Toscelik and to set the cash deposit rate for
Toscelik to zero.
EFFECTIVE DATE: June 15, 2010.
FOR FURTHER INFORMATION CONTACT: Tyler Weinhold or Robert James, AD/CVD
Operations, Office 7, Import Administration, International Trade
Administration, U.S. Department of Commerce, 14th Street and
Constitution Avenue, NW, Washington, DC 20230; telephone: (202) 482-
1121 or (202) 482-0649, respectively.
SUPPLEMENTARY INFORMATION:
Background
The Department published the antidumping duty order on light-walled
rectangular ripe and tube from Turkey on May 30, 2008. See Notice of
Antidumping Duty Order: Light-Walled Rectangular Pipe and Tube from
Turkey, 73 FR 31065 (May 30, 2008). On May 1, 2009, the Department
published the notice of opportunity to request an administrative review
of light-walled rectangular pipe and tube from Turkey for the period
January 30, 2008, through April 30, 2009. See Antidumping or
Countervailing Duty Order, Finding, or Suspended Investigation;
Opportunity To Request Administrative Review, 74 FR 20278 (May 1,
2009).
On May 29, 2009, Toscelik requested an administrative review for
this period. On June 24, 2009, the Department published in the Federal
Register a notice of initiation of this antidumping duty administrative
review. See Initiation of Antidumping and Countervailing Duty
Administrative Reviews and Requests for Revocation in Part, 74 FR 30052
(June 24, 2009). On June 25, 2009, Toscelik made an entry of appearance
in the proceeding.
On July 21, 2009, Toscelik sent a letter to the Department
requesting that the reporting period for home market sales be limited
to the period May 1, 2008 to April 30, 2009. This is consistent with
our past practice in other cases in which respondents request limited
reporting period because they made sales of subject merchandise in only
a small part of the POR. See, e.g., Certain Hot-Rolled Carbon Steel
Flat Products From India: Preliminary Results of Antidumping Duty
Administrative Review, 71 FR 2018 (January 12, 2006) (unchanged in
Final Results, 71 FR 40694) and Certain Hot-Rolled Flat-Rolled Carbon
Quality Steel Products from Brazil; Preliminary Results of Antidumping
Duty Administrative Review, 70 FR 17406 (April 6, 2005) (unchanged in
Final Results, 70 FR 58683). On July 31, 2009, the Department sent
Toscelik a letter indicating our consent to limiting the reporting
period for home market sales to the period of May 1, 2008 through June
30, 2009, based on the timing of its U.S. sales during the POR.
Toscelik had requested that we limit the reporting period to May 1,
2008 through April 30, 2009, however we did not shorten the end of the
reporting period because in our margin calculations, U.S. sales made in
March and April 2009, could potentially match to home market sales made
in May or June, 2009. On August 4, 2009, Atlas Tube, Inc. and Searing
Industries, Inc. (``Petitioners'') made an entry of appearance in this
proceeding.
On July 20, 2009, the Department issued its antidumping
questionnaire to Toscelik. Toscelik submitted its response to section A
of the Department's antidumping questionnaire on August 3, 2008
(``Toscelik's Section A Response''). Toscelik submitted its response to
sections B and C of the antidumping questionnaire on August 17, 2009
(``Toscelik's Sections B and C Response'').
On September 29, 2009, the Department issued a supplemental
questionnaire to Toscelik regarding Toscelik's Section A Response and
Toscelik's Sections B and C Response. Toscelik submitted its response
to the Department's supplemental questionnaire on October 22, 2009
(``Toscelik's October 22, 2009 Response'').
On December 17, 2009, the Department issued a second supplemental
questionnaire to Toscelik regarding its prior questionnaire responses.
Toscelik submitted its response to the Department's second supplemental
questionnaire on January 25, 2010 (``Toscelik's January 25, 2010
Response''). On February 24, 2010, the Department issued a third
supplemental questionnaire to Toscelik. Toscelik submitted its response
to the Department's third supplemental questionnaire on March 8, 2010
(``Toscelik's March 8, 2010 Response''). On May 13, 2010, the
Department issued a third supplemental questionnaire to Toscelik
regarding its prior questionnaire responses. Toscelik submitted its
response to the Department's third supplemental questionnaire on May
18, 2010 (``Toscelik's May 18, 2010 Response'').
Scope of the Order
The merchandise subject to this order is certain welded carbon
quality light-walled steel pipe and tube, of rectangular (including
square) cross section, having a wall thickness of less than 4 mm. The
term carbon-quality steel includes both carbon steel and alloy steel
which contains only small amounts of alloying elements. Specifically,
the term carbon-quality includes products in which none of the elements
listed below exceeds the quantity by weight respectively indicated:
1.80 percent of manganese, or 2.25 percent of silicon, or 1.00 percent
of copper, or 0.50 percent of aluminum, or 1.25 percent of chromium, or
0.30 percent of cobalt, or 0.40 percent of lead, or 1.25 percent of
nickel, or 0.30 percent of tungsten, or 0.10 percent of molybdenum, or
0.10 percent of niobium, or 0.15 percent vanadium, or 0.15 percent of
zirconium. The description of carbon-quality is intended to identify
carbon-quality products within the scope. The welded carbon-quality
rectangular pipe and tube subject to this order is currently classified
under the Harmonized Tariff Schedule of the United States (HTSUS)
subheadings 7306.61.50.00 and 7306.61.70.60. While HTSUS subheadings
are provided for convenience and CBP's customs purposes, our written
description of the scope of the order is dispositive.
Verification
We conducted verification of Toscelik from April 12, 2010, through
April 15,
[[Page 33780]]
2010. See the Memorandum from Tyler Weinhold and Mark Flessner to the
File, ``Light-Walled Rectangular Pipe and Tube from Turkey;
Verification of Information submitted by Toscelik Profil ve Sac
Endustrisi A.S. and Tosyali Dis Ticaret A.S. (collectively,
``Toscelik''),'' (``Verification Report'').
Fair Value Comparisons
To determine whether sales of light-walled rectangular pipe and
tube from Turkey in the United States were made at less than NV, we
compared U.S. price to NV, as described in the ``Export Price'' and
``Normal Value'' sections of this notice. In accordance with section
777A(d)(2) of the Tariff Act of 1930, as amended (``the Act''), we
calculated monthly weighted-average NVs and compared these to
individual U.S. transactions. Because we determined Toscelik made only
EP sales during the POR, we used EP as the basis for U.S. price in all
of our comparisons. We used the invoice date, as recorded in Toscelik's
normal books and records, as the date of sale for Toscelik's EP and
home market sales. See 19 CFR 351.401(i). For a more detailed
discussion of these calculations, see Memorandum from Tyler Weinhold to
the File, ``Analysis of Data Submitted by Toscelik Profil ve Sac
Endustrisi A.S. and Tosyali Dis Ticaret A.S. (collectively,
``Toscelik'') in the Preliminary Results of the 2008-2009
Administrative Review of Light-Walled Rectangular Pipe and Tube from
Turkey,'' dated June 7, 2010 ``Preliminary Analysis Memorandum'').
Product Comparisons
In accordance with section 771(16) of the Act, we considered all
products produced by Toscelik covered by the description in the ``Scope
of the Order'' section, above, and sold in the home market during the
POR, to be foreign like products for purposes of determining
appropriate product comparisons to U.S. sales. As mentioned above, we
allowed Toscelik to limit the reporting period for home market sales to
the period of May 1, 2008 through June 30, 2009. We relied on six
characteristics to match U.S. sales of subject merchandise to home
market sales of the foreign like product (listed in order of priority):
1) steel input type; 2) metallic coating; 3) painted/non-painted; 4)
perimeter; 5) wall thickness; and 6) shape. See the antidumping
questionnaire at Appendix 5. Where there were no sales of identical
merchandise in the home market to compare to U.S. sales, we compared
U.S. sales to the next most similar foreign like product on the basis
of these product characteristics and the reporting instructions listed
in the antidumping questionnaire. Because there were sales of identical
or similar merchandise in the home market suitable for comparison to
each U.S. sale, we did not compare any U.S. sales to constructed value
(``CV'').
We relied on the prices and adjustments as reported by Toscelik
based on Toscelik's proprietary weights. See Verification Report for
more details.
Export Price
Section 772(a) of the Act defines EP as ``the price at which the
subject merchandise is first sold (or agreed to be sold) before the
date of importation by the producer or exporter of subject merchandise
outside of the United States to an unaffiliated purchaser in the United
States or to an unaffiliated purchaser for exportation to the United
States,'' as adjusted under section 772(c). In accordance with section
772(a) of the Act, we used EP for all of Toscelik's U.S. sales. We
preliminarily find that these sales are properly classified as EP sales
because these sales were made before the date of importation and were
made directly to unaffiliated U.S. customers, and because our CEP
methodology was not otherwise warranted.
We based EP on the prices to unaffiliated customers in the United
States. We made adjustments for price or billing adjustments and
discounts, where applicable. We also made deductions for movement
expenses in accordance with section 772(c)(2)(A) of the Act, which
included, where appropriate, foreign inland freight, international
freight, marine insurance, and U.S. brokerage and handling.
Additionally, we made adjustments for direct selling expenses (credit
expenses) in accordance with section 772(c)(2)(A) of the Act.
Normal Value
A. Selection of Comparison Market
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
(i.e., the aggregate volume of home market sales of the foreign like
product was equal to or greater than five percent of the aggregate
volume of U.S. sales), we compared Toscelik'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)(1) of the Act.
Because Toscelik's aggregate volume of home market sales of the foreign
like product was greater than five percent of its aggregate volume of
U.S. sales of the subject merchandise, we determined the home market
was viable. Therefore, we have based NV on home market sales in the
usual commercial quantities and in the ordinary course of trade.
B. Cost of Production Analysis
No interested party has alleged sales in the home market were made
at prices below the cost of production. Therefore, we are not
conducting a sales-below-cost investigation in this review. For this
reason, and because we did not anticipate that we would have to use
constructed value as the basis for normal value for any of Toscelik's
U.S. sales of subject merchandise, we have not required Toscelik to
respond to section D of the Department's questionnaire (costs of
production and constructed value).
Quarterly Costs of Production
Toscelik reported variable cost of manufacture and total cost of
manufacture on the basis of quarterly costs, and requested that it be
allowed to continue to report variable cost of manufacture and total
cost of manufacture on this basis because of changes in the purchase
prices of one of its major input materials, steel coil (steel sheet/
strip in coils). See Toscelik's Sections B and C Response at pages 37
to 38, and at Exhibit 8.
The Department's normal practice is to calculate an annual
weighted-average cost for the entire POR. See, e.g., Notice of Final
Results of Antidumping Duty Administrative Review: Certain Pasta from
Italy, 65 FR 77852 (December 13, 2000), and accompanying Issues and
Decision Memorandum at Comment 18, and Notice of Final Results of
Antidumping Duty Administrative Review: Carbon and Certain Alloy Steel
Wire Rod from Canada, 71 FR 3822 (January 24, 2006), and accompanying
Issues and Decision Memorandum at Comment 5 (explaining the
Department's practice of computing a single weighted-average cost for
the entire period). However, the Department recognizes that possible
distortions may result if our normal annual average cost method is used
during a period of significant cost changes. Therefore, the Department
will deviate from its normal methodology of calculating an annual
weighted average cost under certain circumstances.
In determining whether to deviate from our normal methodology of
calculating an annual weighted average cost, the Department evaluates
the case-specific record evidence using two primary factors: (1) the
change in the cost of manufacturing recognized by the
[[Page 33781]]
respondent during the POR must be deemed significant; and, (2) the
record evidence must indicate that sales prices during the shorter
averaging periods could be reasonably linked with the cost of
production (``COP'') or CV during the same shorter averaging periods.
See Stainless Steel Plate in Coils From Belgium: Final Results of
Administrative Review, 73 FR 75398, 75399 ``December 11, 2008) (``SSPC
from Belgium'') and Stainless Steel Sheet and Strip in Coils from
Mexico: Final Results of Administrative Review, 75 FR 6627 (February
10, 2010) (``S4 from Mexico'').
In this case, we have determined that the record evidence satisfies
these criteria for the pipe and tube products. The record indicates
Toscelik experienced significant changes in the cost of manufacturing
(``COM'') during the POR and that the change in COM is primarily
attributable to the price volatility for coils, which are major inputs
consumed in the production of the merchandise under consideration. See
Preliminary Analysis Memorandum. The data show the percentage
difference between the high and low quarterly COM clearly exceeded 25
percent during the POR. Id. Our analysis of the data provided by
Toscelik reveals that during the POR sales and costs were generally
trending in a consistent manner, and also that Toscelik turns over its
inventory relatively quickly. Id. These facts indicate that Toscelik's
costs and sales prices were reasonably correlated during the POR.
Therefore, the Department has used variable costs of manufacture
and total costs of manufacture based on Toscelik's quarterly costs of
production in these preliminary results of review. Specifically, the
Department has conducted the ``below cost'' and ``cost recovery'' tests
using an annual weighted average cost of manufacturing that
incorporates an indexing method that addresses the distortive effect of
the price volatility for costs. For a detailed analysis, see
Preliminary Analysis Memorandum.
C. Price-to-Price Comparisons
We calculated NV based on prices to unaffiliated customers. We made
adjustments for billing adjustments, early payment discounts, and
rebates, where appropriate. We made deductions, where appropriate, for
foreign inland freight, pursuant to section 773(a)(6)(B) of the Act. In
addition, when comparing sales of similar merchandise, we made
adjustments for differences in cost (i.e., DIFMER), where those
differences were attributable to differences in physical
characteristics of the merchandise, pursuant to section
773(a)(6)(C)(ii) of the Act and section 351.411 of the Department's
regulations. We also made adjustments for differences in circumstances
of sale (``COS'') in accordance with section 773(a)(6)(C)(iii) of the
Act and section 351.410 of the Department's regulations. We made COS
adjustments for imputed credit expenses. Finally, we deducted home
market packing costs and added U.S. packing costs in accordance with
sections 773(a)(6)(A) and (B) of the Act.
D. Constructed Value
In accordance with section 773(a)(4) of the Act, we base NV on CV
if we are unable to find a contemporaneous comparison market match of
identical or similar merchandise for the U.S. sale. Section 773(e) of
the Act provides that CV shall be based on the sum of the cost of
materials and fabrication employed in making the subject merchandise,
SG&A expenses, profit, and U.S. packing costs. However, as explained
above, for these preliminary results, we did not base NV on CV in any
instances.
Level of Trade
In accordance with section 773(a)(1)(B) of the Act, to the extent
practicable, we base NV on sales made in the comparison market at the
same level of trade (``LOT'') as the export transaction. The NV LOT is
based on the starting price of sales in the home market or, when NV is
based on CV, on the LOT of the sales from which SG&A expenses and
profit are derived.
To determine whether NV sales are at a different LOT than CEP
sales, we examine stages in the marketing process and selling functions
along the chain of distribution between the producer and the customer.
See 19 CFR 351.412(c)(2). If the comparison-market sales are at a
different LOT, and the difference affects price comparability, as
manifested in a pattern of consistent price differences between the
sales on which NV is based and comparison-market sales at the LOT of
the export transaction, we make a LOT adjustment under section
773(a)(7)(A) of the Act. We expect that if the claimed LOTs are the
same, the functions and activities of the seller should be similar.
Conversely, if a party claims the LOTs are different for different
groups of sales, the functions and activities of the seller should be
dissimilar. See Porcelain-on-Steel Cookware from Mexico: Final Results
of Antidumping Duty Administrative Review, 65 FR 30068 (May 10, 2000)
and accompanying Issues and Decision Memorandum at Comment 6.
Toscelik reported that it sold light-walled rectangular pipe and
tube at only one level of trade in the home market and in the U.S.
market. See Toscelik's Sections B and C Response at pages 23 and 61.
Toscelik identified one channel of distribution for sales in the home
market, ``ex works'' (channel 1) and one channel of distribution in the
U.S. market, ``direct to the importer'' (channel 1). See Toscelik's
Section A Response at page 12 and 13, and Toscelik's Sections B and C
Response at pages 15 and 54. Toscelik also reported that all sales in
the home market were sold to customers within the same customer
category, ``distributors,'' and that all sales in the U.S. were sold to
the same customer category, ``importer.'' See Toscelik's Sections B and
C Response at pages 15 and 53.
Based on our analysis of the record evidence provided by Toscelik,
we preliminarily determine that a single LOT exists in the home market.
Therefore, we have no basis upon which to calculate a level of trade
adjustment. For these reasons, we preliminarily find that a LOT
adjustment is not appropriate for Toscelik.
Moreover, we find that only minor differences exist between the
sole home market channel of distribution and the sole U.S. channel of
distribution, that of Toscelik's EP sales. We obtained information from
Toscelik regarding the marketing stages involved in making its reported
home market and U.S. sales. Toscelik described all selling activities
performed, and provided a table comparing the selling functions
performed among each channel of distribution for both markets. See
Toscelik's Section A response at Exhibit 7. We reviewed the nature of
the selling functions and the intensity to which all selling functions
were performed between Toscelik's EP and home market channels of
distribution and customer categories.
While we found differences in the levels of intensity performed
between the home market and U.S. market channels of distribution for
one of these functions, the ``warranty service'' function, the
difference is minor. Toscelik reported that it performed these
functions in the home market at a level of ``<1'' on a scale of 1 to
10, and not at all in the U.S. market. See Toscelik's Section A
Response at Exhibit 7. Therefore, we find only minor differences exist
between the sole home market channel of distribution and the sole U.S.
channel of distribution, that of Toscelik's EP sales.
The Department has determined that we will find sales to be at the
same LOT when the selling functions performed for each customer class
are sufficiently similar. See 19 CFR 351.412 (c)(2). We
[[Page 33782]]
find Toscelik performed virtually the same level of customer support
services on its EP sales as it did on its home market sales and that
the minor differences that do exist do not establish distinct and
separate levels of trade.
The record evidence supports a finding that in both markets and in
both channels of distribution Toscelik performs essentially the same
level of services. Therefore, based on our analysis of the selling
functions performed on EP sales in the United States, and its sales in
the home market, we determine that the EP and the starting price of
home market sales represent the same stage in the marketing process,
and are thus at the same LOT.
Currency Conversions
In accordance with section 773A(a) of the Act, we made Turkish
lira-U.S. dollar currency conversions, where appropriate, based on the
exchange rates in effect on the dates of the U.S. sales, as collected
by Dow Jones Reuters Business Interactive LLC (trading as Factiva) and
as published on the Import Administration's web site (http://ia.ita.doc.gov/exchange/index.html).
Preliminary Results of Review
As a result of our review, we preliminarily find the following
weighted-average dumping margin exists for the period January 30, 2008,
through April 30, 2009:
------------------------------------------------------------------------
Weighted Average
Manufacturer / Exporter Margin
(percentage)
------------------------------------------------------------------------
Toscelik............................................ 0.00%
------------------------------------------------------------------------
Disclosure and Public Hearing
The Department will disclose calculations performed within five
days of the date of publication of this notice in accordance with
section 351.224(b) of the Department's regulations. An interested party
may request a hearing within thirty days of publication. See section
351.310(c) of the Department's regulations. Any hearing, if requested,
will be held 37 days after the date of publication, or the first
business day thereafter, unless the Department alters the date pursuant
to section 351.310(d) of the Department's regulations. Requests should
contain the party's name, address, and telephone number, the number of
participants, and a list of the issues to be discussed. At the hearing,
each party may make an affirmative presentation only on issues raised
in that party's case brief and may make rebuttal presentations only on
arguments included in that party's rebuttal brief.
Comments
Interested parties may submit case briefs no later than 30 days
after the date of publication of these preliminary results of review.
See 19 CFR 351.309(c). Rebuttal briefs, limited to issues raised in the
case briefs, may be filed no later than 35 days after the date of
publication of this notice. See 19 CFR 351.309(d). Parties who submit
arguments in this proceeding are requested to submit with the argument:
1) a statement of the issue; 2) a brief summary of the argument; and 3)
a table of authorities. Further, parties submitting written comments
should provide the Department with an additional copy of the public
version of any such comments on diskette. The Department will issue
final results of this administrative review, including the results of
our analysis of the issues in any such written comments or at a
hearing, within 120 days of publication of these preliminary results.
Assessment Rates
The Department shall determine, and CBP shall assess, antidumping
duties on all appropriate entries. Upon completion of this
administrative review, pursuant to section 351.212(b) of the
Department's regulations, the Department will calculate an assessment
rate on all appropriate entries. Toscelik has reported entered values
for all of its sales of subject merchandise to the United States during
the POR. Therefore, in accordance with section 351.212(b)(1) of the
Department's regulations, we will calculate importer-specific duty
assessment rates on the basis of the ratio of the total amount of
antidumping duties calculated for the examined sales to the total
entered value of the examined sales of that importer. These rates will
be assessed uniformly on all entries the respective importers made
during the POR. Where the assessment rate is above de minimis, we will
instruct CBP to assess duties on all entries of subject merchandise by
that importer. The Department intends to issue appropriate assessment
instructions directly to CBP fifteen days after publication of the
final results of review.
The Department clarified its ``automatic assessment'' regulation on
May 6, 2003. See Antidumping and Countervailing Duty Proceedings:
Assessment of Antidumping Duties, 68 FR 23954 (May 6, 2003). This
clarification will apply to entries of subject merchandise during the
POR produced by the respondent for which it did not know its
merchandise was destined for the United States. In such instances, we
will instruct CBP to liquidate un-reviewed entries at the all-others
rate if there is no rate for the intermediate company(ies) involved in
the transaction. Id.
Cash Deposit Requirements
Furthermore, the following deposit requirements will be effective
upon completion of the final results of this administrative review for
all shipments of light-walled rectangular pipe and tube from Turkey
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
Toscelik will be the rate established in the final results of review;
2) if the exporter is not a firm covered in this review or the less-
than-fair-value (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 3) if neither the exporter
nor the manufacturer is a firm covered in this or any previous review
conducted by the Department, the cash deposit rate will be the all-
others rate of 27.04 percent ad valorem from the LTFV investigation.
See Notice of Antidumping Duty Order: Light-Walled Rectangular Pipe and
Tube From Turkey, 73 FR 31065 (May 30, 2008). These deposit
requirements, when imposed, shall remain in effect until further
notice.
Notification to Importers
This notice also serves as a preliminary reminder to importers of
their responsibility under 19 CFR 351.402(f) 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 the antidumping duties.
We are issuing and publishing this notice in accordance with
sections 751(a)(1) and 777(i)(1) of the Act.
Dated: June 7, 2010.
Ronald K. Lorentzen,
Deputy Assistant Secretary for Import Administration.
[FR Doc. 2010-14371 Filed 6-14-10; 8:45 am]
BILLING CODE 3510-DS-S