Certain Hot-Rolled Carbon Steel Flat Products From Thailand; Preliminary Results of Antidumping Duty Administrative Review and Intent to Revoke and Rescind in Part, 73197-73205 [05-23876]

Download as PDF Federal Register / Vol. 70, No. 236 / Friday, December 9, 2005 / Notices • Introductory Remarks by Chairman. • Speakers’ Presentations. • Questions by Commissioners and Staff Director. IX. Staff Director’s Report. X. Future Agenda Items. FOR FURTHER INFORMATION CONTACT: Terri Dickerson, Press and Communications, (202) 376–8582. Kenneth L. Marcus, Staff Director, Acting General Counsel. [FR Doc. 05–23887 Filed 12–6–05; 4:45 pm] BILLING CODE 6335–01–M DEPARTMENT OF COMMERCE International Trade Administration A–549–817 Certain Hot-Rolled Carbon Steel Flat Products From Thailand; Preliminary Results of Antidumping Duty Administrative Review and Intent to Revoke and Rescind in Part Import Administration, International Trade Administration, Department of Commerce. SUMMARY: In response to requests from Sahaviriya Steel Industries Public Company Limited (SSI), United States Steel Corporation (petitioner), and Nucor Corporation (domestic interested party (Nucor)), the Department of Commerce (the Department) is conducting an administrative review of the antidumping duty order on certain hot-rolled carbon steel flat products (hot-rolled steel) from Thailand. This administrative review covers imports of subject merchandise produced and exported by SSI. We preliminarily determine that sales of subject merchandise by SSI have been made at not less than normal value (NV). Because SSI made sales at not less than NV for three consecutive years during the antidumping duty order, we are preliminarily revoking the order on hot-rolled steel from Thailand with respect to SSI. See Intent to Revoke with Respect to SSI below. In addition, we are preliminarily rescinding this review with respect to Nakornthai Strip Mill Public Co., Ltd. (Nakornthai) and G Street Public Company Limited (formerly Siam Strip Mill Public Co., Ltd.) (G Street), because both companies reported, and we confirmed, that neither made shipments of subject merchandise to the United States during the POR. If these preliminary results are adopted in our final results, we will instruct U.S. Customs and Border Protection (CBP) to assess antidumping duties on appropriate entries based on the difference between the export price (EP) AGENCY: VerDate Aug<31>2005 14:22 Dec 08, 2005 Jkt 208001 and the NV. Interested parties are invited to comment on these preliminary results. Parties who submit argument in this proceeding are requested to submit with the argument: 1) a statement of the issues, 2) a brief summary of the argument, and 3) a table of authorities. EFFECTIVE DATE: December 9, 2005. FOR FURTHER INFORMATION CONTACT: Stephen Bailey or Abdelali Elouaradia, 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) 482–0193 or (202) 482– 1374, respectively. SUPPLEMENTARY INFORMATION: Background On November 29, 2001, the Department published the antidumping duty order on hot-rolled steel from Thailand. See Notice of Antidumping Duty Order: Certain Hot-Rolled Carbon Steel Flat Products From Thailand, 66 FR 59562 (November 29, 2001) (HotRolled Steel Order). On November 1, 2004, the Department published the opportunity to request administrative review of, inter alia, hot-rolled steel from Thailand for the period November 1, 2003, through October 31, 2004. See Antidumping or Countervailing Duty Order, Finding, or Suspended Investigation; Opportunity to Request Administrative Review, 69 FR 63359 (November 1, 2004). In accordance with 19 CFR 351.213(b)(1), on November 30, 2004, SSI, petitioner, and Nucor requested that we conduct an administrative review of SSI’s sales of the subject merchandise. In its administrative review request, petitioner requested that we also review sales of Nakornthai and G Street. On November 30, 2004, SSI requested that the antidumping duty order on hot-rolled steel, as it relates to SSI, be revoked based on the absence of dumping, and included with its request certain company certifications regarding revocation. On December 27, 2004, the Department published in the Federal Register a notice of initiation of this antidumping duty administrative review covering the period November 1, 2003, through October 31, 2004. See Initiation of Antidumping and Countervailing Duty Administrative Reviews and Request for Revocation in Part, 69 FR 77181 (December 27, 2004). On January 6, 2005, the Department issued its antidumping duty questionnaire to SSI, Nakornthai, and G Street. On January 8 and 20, 2005, respectively, Nakornthai and G Street PO 00000 Frm 00004 Fmt 4703 Sfmt 4703 73197 submitted no-shipment certification letters to the Department indicating that they had no sales of subject merchandise during the POR and requesting a rescission of the administrative review with respect to each company. SSI submitted its response to Section A of the questionnaire (Section A response) on January 27, 2005, and its responses to Sections B and C (Sections B and C responses) on February 22, 2005. SSI submitted its response to Section D of the questionnaire (Section D response) on February 28, 2005. The Department issued a supplemental Sections A through C questionnaire to SSI on April 13, 2005, and received SSI’s response on May 16, 2005. The Department issued a supplemental Section D questionnaire to SSI on April 28, 2005, and SSI submitted its response on May 20, 2005. The Department issued a second Sections A through C supplemental questionnaire on June 17, 2005, and SSI submitted its response on June 24, 2005. On April 19, 2005, SSI submitted factual information with respect to revocation of the underlying antidumping duty order as it pertains to SSI. On July 1, 2005, the Department requested that parties submit comments regarding revocation by July 21, 2005. On July 21, 2005, both SSI and Nucor submitted comments on revocation. Petitioner did not submit comments. On August 1, 2005, SSI submitted comments to rebut Nucor’s July 21, 2005 submission. Petitioner and Nucor did not submit rebuttal comments. Period of Review The period of review is November 1, 2003, through October 31, 2004. Scope of the Order For purposes of this review, the products covered are certain hot-rolled carbon steel flat products of a rectangular shape, of a width of 0.5 inch or greater, neither clad, plated, nor coated with metal and whether or not painted, varnished, or coated with plastics or other non-metallic substances, in coils (whether or not in successively superimposed layers), regardless of thickness, and in straight lengths, of a thickness of less than 4.75 mm and of a width measuring at least 10 times the thickness. Universal mill plate (i.e., flat-rolled products rolled on four faces or in a closed box pass, of a width exceeding 150 mm, but not exceeding 1250 mm, and of a thickness of not less than 4.0 mm, not in coils and without patterns in relief) of a thickness not less than 4.0 mm is not included within the scope of this review. E:\FR\FM\09DEN1.SGM 09DEN1 73198 Federal Register / Vol. 70, No. 236 / Friday, December 9, 2005 / Notices Specifically included within the scope of this review are vacuum degassed, fully stabilized (commonly referred to as interstitial-free (IF)) steels, high strength low alloy (HSLA) steels, and the substrate for motor lamination steels. IF steels are recognized as low carbon steels with micro-alloying levels of elements such as titanium or niobium (also commonly referred to as columbium), or both, added to stabilize carbon and nitrogen elements. HSLA steels are recognized as steels with micro-alloying levels of elements such as chromium, copper, niobium, vanadium, and molybdenum. The substrate for motor lamination steels contains micro-alloying levels of elements such as silicon and aluminum. Steel products to be included in the scope of this review, regardless of definitions in the Harmonized Tariff Schedule of the United States (HTSUS), are products in which: i) iron predominates, by weight, over each of the other contained elements; ii) the carbon content is 2 percent or less, by weight; and iii) 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 of vanadium, or 0.15 percent of zirconium. All products that meet the physical and chemical description provided above are within the scope of this review unless otherwise excluded. The following products, by way of example, are outside or specifically excluded from the scope of this review: • Alloy hot-rolled steel products in which at least one of the chemical elements exceeds those listed above (including, e.g., American Society for Testing and Materials (ASTM) specifications A543, A387, A514, A517, A506). • Society of Automotive Engineers (SAE)/American Iron & Steel Institute (AISI) grades of series 2300 and higher. • Ball bearing steels, as defined in the HTSUS. • Tool steels, as defined in the HTSUS. • Silico-manganese (as defined in the HTSUS) or silicon electrical steel with a silicon level exceeding 2.25 percent. • ASTM specifications A710 and A736. VerDate Aug<31>2005 14:22 Dec 08, 2005 Jkt 208001 • USS abrasion-resistant steels (USS AR 400, USS AR 500). • All products (proprietary or otherwise) based on an alloy ASTM specification (sample specifications: ASTM A506, A507). • Non-rectangular shapes, not in coils, which are the result of having been processed by cutting or stamping and which have assumed the character of articles or products classified outside chapter 72 of the HTSUS. The merchandise subject to this review is classified in the HTSUS at subheadings: 7208.10.15.00, 7208.10.30.00, 7208.10.60.00, 7208.25.30.00, 7208.25.60.00, 7208.26.00.30, 7208.26.00.60, 7208.27.00.30, 7208.27.00.60, 7208.36.00.30, 7208.36.00.60, 7208.37.00.30, 7208.37.00.60, 7208.38.00.15, 7208.38.00.30, 7208.38.00.90, 7208.39.00.15, 7208.39.00.30, 7208.39.00.90, 7208.40.60.30, 7208.40.60.60, 7208.53.00.00, 7208.54.00.00, 7208.90.00.00, 7211.14.00.90, 7211.19.15.00, 7211.19.20.00, 7211.19.30.00, 7211.19.45.00, 7211.19.60.00, 7211.19.75.30, 7211.19.75.60, and 7211.19.75.90. Certain hot-rolled carbon steel flat products covered by this review, including: vacuum degassed fully stabilized; high strength low alloy; and the substrate for motor lamination steel may also enter under the following tariff numbers: 7225.11.00.00, 7225.19.00.00, 7225.30.30.50, 7225.30.70.00, 7225.40.70.00, 7225.99.00.90, 7226.11.10.00, 7226.11.90.30, 7226.11.90.60, 7226.19.10.00, 7226.19.90.00, 7226.91.50.00, 7226.91.70.00, 7226.91.80.00, and 7226.99.00.00. Subject merchandise may also enter under 7210.70.30.00, 7210.90.90.00, 7211.14.00.30, 7212.40.10.00, 7212.40.50.00, and 7212.50.00.00. Although the HTSUS subheadings are provided for convenience and CBP purposes, the written description of the merchandise under review is dispositive. Verification As provided in section 782(i) of the Tariff Act of 1930, as amended (the Act), we verified sales information from August 24, 2005, through August 29, 2005, and cost of production information from October 24, 2005, through October 28, 2005, using standard verification procedures, including an examination of relevant sales, cost, financial records, and selection of original documentation containing relevant information. Our verification results are outlined in the public versions of the verification PO 00000 Frm 00005 Fmt 4703 Sfmt 4703 reports and are on file in the Department’s Central Records Unit (CRU) located in Room B–099 of the main Department of Commerce Building, 14th Street and Constitution Avenue, NW., Washington, DC. Partial Rescission of Administrative Review As explained above, on January 8, 2005, Nakornthai submitted a statement that it had no sales to the United States during the POR. On January 20, 2005, G Street submitted a similar statement. The Department conducted a query of CBP data on entries of hot-rolled steel from Thailand made during the POR, and confirmed that Nakornthai and G Street made no entries during this period. Therefore, we are preliminarily rescinding this review with respect to Nakornthai and G Street in accordance with section 351.213(d)(3) of the Department’s regulations. Fair Value Comparisons To determine whether sales of subject merchandise were made in the United States at less than fair value, we compared the EP to the NV, as described in the ‘‘Export Price’’ and ‘‘Normal Value’’ sections of this notice. In accordance with section 777A(d)(1)(A)(i) of the Act, we calculated EP and compared these prices to weighted-average normal values or constructed values (CV), as appropriate. Product Comparisons In accordance with section 771(16) of the Act, we considered all products produced by SSI covered by the descriptions in the ‘‘Scope of the Order’’ section of this notice to be foreign like products for the purpose of determining appropriate product comparisons to SSI’s U.S. sales of the subject merchandise. We have relied on the following eleven criteria to match U.S. sales of the subject merchandise to sales in Thailand of the foreign like product: paint, quality, carbon, yield strength, thickness, width, cut-to-length vs. coil, temper rolled, pickled, edge trim, and patterns in relief. 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 the characteristics and reporting instructions listed in the Department’s January 6, 2005, questionnaire. Export Price In accordance with section 772 of the Act, we calculate either an EP or a CEP, E:\FR\FM\09DEN1.SGM 09DEN1 Federal Register / Vol. 70, No. 236 / Friday, December 9, 2005 / Notices depending on the nature of each sale. Section 772(a) of the Act defines EP as the price at which the subject merchandise is first sold by the foreign exporter or producer before the date of importation to an unaffiliated purchaser in the United States, or to an unaffiliated purchaser for exportation to the United States. We have preliminarily determined that all of SSI’s U.S. sales during the POR were EP sales. We calculated EP based on prices charged to the first unaffiliated U.S. customer. We used the final contract date as the date of sale. We based EP on the packed cost and freight (CFR) prices to the first unaffiliated purchasers outside Thailand. We made deductions for movement expenses in accordance with section 772(c)(2)(A) of the Act, including foreign inland freight and foreign brokerage and handling. Duty Drawback Section 772(c)(1)(B) of the Act provides that EP shall be increased by ‘‘the amount of any import duties imposed by the country of exportation which have been rebated, or which have not been collected, by reason of the exportation of the subject merchandise to the United States.’’ The Department determines that an adjustment to U.S. price for claimed duty drawback is appropriate when a company can demonstrate that (1) the import duty and the rebate are directly linked to, and dependent upon, one another, and (2) there are sufficient imports of the imported material to account for the duty drawback received for the export of the manufactured product (the ‘‘two pronged test’’). See Rajinder Pipes Ltd. v. United States, 70 F. Supp. 2d 1350, 1358 (CIT 1999). See also Certain Welded Carbon Standard Steel Pipes and Tubes from India: Final Results of New Shippers Antidumping Duty Administrative Review, 62 FR 47632 (September 10, 1997) and Federal Mogul Corp. v. United States, 862 F. Supp. 384, 409 (CIT 1994). During the POR, SSI received duty drawback for its U.S. sales under the Thai Board of Investment (BOI) duty drawback tax certificate program (TCP). Under the TCP, SSI applies to the BOI for a duty exemption for imported slab, with the BOI maintaining a running tally of SSI’s requests for slab exemptions.1 When SSI intends to export finished material, it applies to the BOI requesting a duty exemption for 1 SSI explained during verification that during the current POR it did not use the BOI 36 program used in previous PORs because it expired. See page 35 of the Department’s Sales Verification Report dated November 28, 2005. VerDate Aug<31>2005 14:22 Dec 08, 2005 Jkt 208001 the exported material. During verification, the Department found that SSI maintains its duty exemption records on a FIFO (first in first out) basis. Additionally, we noted that when SSI submits its application for duty drawback, SSI is not required by the Thai government to link the specific imported slab to the specific exported hot-rolled coil. Consistent with the Department’s decision in Final Determination of Sales at Less Than Fair Value: Oil Country Tubular Good from Korea, 60 FR 33561 (June 28, 1995) (OCTG From Korea), to allow duty drawback even though the respondent could not link the particular exportation of subject merchandise back to a particular imported material, the Department concludes that for SSI’s U.S. sales, the company uses a methodology consistent with Department practice for applying its duty drawback received upon export of subject merchandise to the United States. See also Far East Mach. II, 12 CIT at 975, 699 F.Supp. at 312. SSI also meets the second criterion of the two-pronged test for its U.S. sales. All of SSI’s hot-rolled steel is made from imported slab, which demonstrates that there are sufficient imports of material to account for duty drawback. See SSI’s February 28, 2005, Section D questionnaire response at page D–8. Therefore, the Department preliminarily concludes that for SSI’s U.S. sales, the company uses a methodology consistent with Department practice for applying duty drawback received upon export of subject merchandise to the United States. See Far East Machinery II, 12 Ct. Int’l Trade 972, 975, 699 F.Supp. 309, 312; see also OCTG from Korea. Normal Value A. Home Market Viability To determine whether there is a sufficient volume of sales in the home market to serve as a viable basis for calculating NV, we compared SSI’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)(B) of the Act. Because SSI’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 for the subject merchandise, we determined the home market was viable. See Section A response at exhibit 1. B. Arm’s Length Sales SSI reported that it made sales in the home market to affiliated and unaffiliated end users and distributors/ retailers during the POR. SSI reported PO 00000 Frm 00006 Fmt 4703 Sfmt 4703 73199 the downstream sales of its affiliated reseller of the foreign like product and we have included them in our NV calculation. SSI also had sales to affiliated customers who consumed the hot-rolled steel in the production of non-subject merchandise. If any of these sales to affiliated customers in the home market were not made at arm’s length prices, we excluded those sales from our analysis because we considered them to be outside the ordinary course of trade. To test whether these sales were made at arm’s-length prices, we compared on a model-specific basis the starting prices of sales to affiliated and unaffiliated customers, net of all billing adjustments, early payment discounts, movement charges, direct selling expenses, and home market packing. Where prices to the affiliated party fell, on average, between 98 percent and 102 percent, inclusive, of sale prices of the same or comparable merchandise sold by that exporter or producer to all unaffiliated customers, we determined that sales made to the related party were at arm’s length. See Antidumping Proceedings: Affiliated Party Sales in the Ordinary Course of Trade, 67 FR 69186 (November 15, 2002). We excluded sales to those customers who failed the arm’s length test. C. Cost of Production Analysis In the most recently completed segment, the Department determined that SSI made sales in the home market at prices below its cost of production (COP) and, therefore, excluded such sales from its calculation of NV. See Certain Hot-Rolled Carbon Steel Flat Products From Thailand: Final Results and Partial Rescission of Antidumping Duty Administrative Review, 69 FR 19388 (April 13, 2004). Therefore, the Department has reasonable grounds to believe or suspect, pursuant to section 773(b)(2)(A)(ii) of the Act, that SSI made sales in the home market at prices below the COP for this POR. As a result, in accordance with section 773(b)(1) of the Act, we examined whether SSI’s sales in the home market were made at prices below the COP. In accordance with section 773(b)(3) of the Act, we calculated the weightedaverage COP for each model based on the sum of SSI’s material and fabrication costs for the foreign like product, plus amounts for selling expenses, general and administrative expenses (G&A), interest expenses and packing costs. We used the information from SSI’s section D questionnaire and supplemental questionnaire responses to calculate COP, except for the following adjustments. For the preliminary results we have disallowed E:\FR\FM\09DEN1.SGM 09DEN1 73200 Federal Register / Vol. 70, No. 236 / Friday, December 9, 2005 / Notices the claimed offset to G&A for the gain on the bond redemption and the additional revenue from the scrap sales and have included all revenue from scrap sales in the denominator of the G&A expense rate calculation. We deducted the revenue from the scrap sales from SSI’s reported total cost of manufacturing. For the financial expense ratio, we have also made the same changes to the cost of goods sold denominator described for the G&A expense rate calculation. For further discussion of these adjustments, see Memorandum to Neal Halper, from Michael P. Harrison and Trinette L. Ruffin, regarding Cost of Production and Constructed Value Calculation Adjustments for the Preliminary Results, on file in the Department’s CRU located in Room B–099 of the main Department of Commerce Building, 14th Street and Constitution Avenue, NW., Washington, DC CRU, dated November 30, 2005. We compared the weighted-average COP figures to the home market sales prices of the foreign like product, as required under section 773(b) of the Act, to determine whether these sales had been made at prices below COP. On a product-specific basis, we compared COP to home market prices, less any applicable movement charges, billing adjustments, taxes, and discounts and rebates. In determining whether to disregard home market sales made at prices below the COP, we examined, in accordance with sections 773(b)(1)(A) and (B) of the Act, whether such sales were made in substantial quantities within an extended period of time, and whether such sales were made at prices which permitted the recovery of all costs within a reasonable period of time in the normal course of trade. Pursuant to section 773(b)(2)(C) of the Act, where less than 20 percent of SSI’s home market sales of a given model were made at prices below the COP, we did not disregard any below-cost sales of that model because we determined that the below-cost sales were not made within an extended period of time in ‘‘substantial quantities.’’ Where 20 percent or more of SSI’s home market sales of a given model were at prices less than COP, we disregarded the below-cost sales because: (1) they were made within an extended period of time in ‘‘substantial quantities,’’ in accordance with sections 773(b)(2)(B) and (C) of the Act, and (2) based on our comparison of prices to the weightedaverage COPs for the POR, they were at prices which would not permit the recovery of all costs within a reasonable period of time, in accordance with section 773(b)(2)(D) of the Act. VerDate Aug<31>2005 14:22 Dec 08, 2005 Jkt 208001 Our cost test for SSI revealed that for home market sales of certain models, less than 20 percent of the sales of those models were made at prices below the COP. We therefore retained all such sales in our analysis and used them as the basis for determining NV. Our cost test also indicated that for certain models, more than 20 percent of the home market sales of those models were sold at prices below COP within an extended period of time and were at prices which would not permit the recovery of all costs within a reasonable period of time. Thus, in accordance with section 773(b)(1) of the Act, we excluded these below-cost sales from our analysis and used the remaining above-cost sales as the basis for determining NV. D. Price-to-Price Comparisons We matched all U.S. sales to NV. We calculated NV based on prices to unaffiliated customers. We adjusted gross unit price for billing adjustments, interest revenue, and the per-unit value of any post-transaction complementary invoices (or credit notes) that were issued to adjust for any errors in the originating invoice. We made deductions, where appropriate, for foreign inland freight and insurance, pursuant to section 773(a)(6)(B) of the Act. In addition, we made adjustments for differences in cost attributable to differences in physical characteristics of the merchandise, pursuant to section 773(a)(6)(C)(ii) of the Act and 19 CFR 351.411, as well as for differences in circumstances of sale (COS) as appropriate, in accordance with section 773(a)(6)(C)(iii) of the Act and 19 CFR 351.410. 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. E. Price-to-CV Comparisons In accordance with section 773(a)(4) of the Act, we based NV on CV if we were unable to find a contemporaneous comparison market match for the U.S. sale. We calculated CV based on the cost of materials and fabrication employed in producing the subject merchandise, selling, general and administrative (SG&A) expenses, interest expense and profit. In accordance with section 773(e)(2)(A) of the Act, we based SG&A expenses, interest and profit on the amounts SSI incurred and realized in connection with the production and sale of the foreign like product in the ordinary course of trade for consumption in Thailand. For selling expenses, we used the weighted-average home market selling expenses. Where appropriate, we made COS adjustments PO 00000 Frm 00007 Fmt 4703 Sfmt 4703 to CV in accordance with section 773(a)(8) of the Act and 19 CFR 351.410 of the Department’s regulations. Level of Trade In accordance with section 773(a)(1)(B) of the Act, to the extent practicable, we determine NV based on sales in the comparison market at the same level of trade (LOT) as the EP transaction or constructed export price (CEP) transaction. The LOT in the comparison market is the LOT of the starting-price sales in the comparison market or, when NV is based on CV, the LOT of the sales from which we derive SG&A expenses and profit. With respect to U.S. price for EP transactions, the LOT is also that of the starting-price sale, which is usually from the exporter to the importer. For CEP, the LOT is that of the constructed sale from the exporter to the importer. To determine whether comparison market sales are at a different LOT from U.S. sales, we examined stages in the marketing process and selling functions along the chain of distribution between the producer and the unaffiliated customer. 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, the Department makes an LOT adjustment in accordance with section 773(a)(7)(A) of the Act. For CEP sales, we examine stages in the marketing process and selling functions along the chain of distribution between the producer and the unaffiliated customer. We analyze whether different selling activities are performed, and whether any price differences (other than those for which other allowances are made under the Act) are shown to be wholly or partly due to a difference in LOT between the CEP and NV. Under section 773(a)(7)(A) of the Act, we make an upward or downward adjustment to NV for LOT if the difference in LOT involves the performance of different selling activities and is demonstrated to affect price comparability, based on a pattern of consistent price differences between sales at different LOTs in the country in which NV is determined. Finally, if the NV LOT is at a more advanced stage of distribution than the LOT of the CEP, but the data available do not provide an appropriate basis to determine an LOT adjustment, we reduce NV by the amount of indirect selling expenses incurred in the foreign comparison market on sales of the foreign like product, but by no more than the amount of the indirect selling E:\FR\FM\09DEN1.SGM 09DEN1 Federal Register / Vol. 70, No. 236 / Friday, December 9, 2005 / Notices expenses incurred for CEP sales. See section 773(a)(7)(B) of the Act (the CEP offset provision). In analyzing differences in selling functions, we determine whether the LOTs identified by the respondent are meaningful. See Antidumping Duties; Countervailing Duties, Final Rule, 62 FR 27296, 27371 (May 19, 1997). If the claimed LOTs are the same, we expect that the 7functions and activities of the seller should be similar. Conversely, if a party claims that LOTs are different for different groups of sales, the functions and activities of the seller should be dissimilar. See Porcelain-onSteel Cookware from Mexico: Final Results of Administrative Review, 65 FR 30068 (May 10, 2000). In the present review, SSI did not claim an LOT adjustment. See Sections B and C responses at B–51. SSI claimed one LOT in the U.S. market and two LOTs in the home market: LOT 1 includes sales through unaffiliated trading companies and direct sales to end-users and LOT 2 includes sales through affiliated trading companies and to service centers. SSI claimed that all U.S. sales are at the same LOT as LOT 1 in the home market. SSI reported four channels of distribution for home market sales made through LOT 1 and LOT 2. The first channel of distribution was sales made through unaffiliated trading companies with two customer categories (i.e., unaffiliated end-users and service centers). The second channel of distribution was sales made through affiliated trading companies with two customer categories (i.e., unaffiliated end-users and service centers). The third channel of distribution was direct sales with two customer categories (i.e., affiliated and unaffiliated end-users and service centers). The fourth channel of distribution was direct sales with one customer category (i.e., affiliated endusers, resellers or service centers). Whether made directly or through affiliates, except for certain additional selling functions that affiliates provide to their unaffiliated customers, the Department finds that SSI reported similar selling activities for all home market sales. While SSI’s direct sales (whether or not resold) and downstream sales in the home market involve different channels of distribution, these sales do not appear to involve significant differences in selling functions and therefore we consider these channels to represent one LOT. Additionally, after analyzing the selling functions SSI reported for its EP sales, we find that the level of trade for SSI’s EP sales is the same as the LOT for all sales in the home market. Based upon VerDate Aug<31>2005 14:22 Dec 08, 2005 Jkt 208001 the above analysis, we preliminarily conclude that the LOT for all EP sales is the same as the LOT for all sales in the home market. Accordingly, because we find the U.S. sales and home market sales to be at the same LOT, no LOT adjustment under section 773(a)(7)(A) of the Act is warranted for SSI. Due to the proprietary nature of the levels of these selling activities, for further analysis, see Memorandum To the File, From Stephen Bailey, Regarding Administrative Review of the Antidumping Duty Order on Certain Hot-Rolled Carbon Steel Flat Products from Thailand; Preliminary Results Analysis for SSI, November 30, 2005. Intent to Revoke with Respect to SSI On November 30, 2004, SSI submitted a letter to the Department requesting revocation of the antidumping order in part, pursuant to 19 CFR § 351.222(b). Along with the revocation request, SSI submitted company certifications that: (1) the company sold subject merchandise at not less than NV during the POR, and that in the future it would not sell such merchandise at less than NV (see 19 CFR 351.222(e)(1)(i)); and (2) the company has sold the subject merchandise to the United States in commercial quantities during each of the past three years. See 19 CFR 351.222(e)(1)(ii). SSI also included a certification that the company agrees to immediate reinstatement of the order if, subsequent to revocation, the Department concludes that the company sold the subject merchandise at less than NV. See 19 CFR 351.222(b)(iii); See also Attachment to SSI’s November 30, 2004 Request for Administrative Review, Request for Revocation of Antidumping Duty Order in Part, and Entry of Appearance. Because SSI is not the sole exporter or producer subject to this antidumping order, the decision whether to revoke the order relates only to SSI. The Department ‘‘may revoke, in whole or in part’’ an antidumping duty order upon completion of a review under section 751 of the Act. While Congress has not specified the procedures that the Department must follow in revoking an order, the Department has developed procedures for revocation that are described in 19 CFR 351.222. This regulation requires, inter alia, that each exporter and producer covered by the order submit the following: (1) a certification that the company has sold the subject merchandise at not less than NV in the current review period and that the company will not sell at less than NV in the future; and (2) a certification that the company sold the subject PO 00000 Frm 00008 Fmt 4703 Sfmt 4703 73201 merchandise in each of the three consecutive years forming the basis of the request in commercial quantities. See 19 CFR 351.222(e)(1). Upon receipt of such a request, the Department may revoke an order, if it concludes that each exporter and producer covered at the time of revocation: (1) sold subject merchandise at not less than NV for a period of at least three consecutive years; and (2) is not likely in the future to sell the subject merchandise at less than NV. See 19 CFR 351.222(b)(2)(i) and (ii). Based on SSI’s November 30, 2004, submission and the accompanying certification from the president of SSI, the Department preliminarily finds that SSI has satisfied the certification requirements of 19 CFR 351.222(e)(1) and 19 CFR 351.222(b)(2)(iii). See Attachment to SSI’s November 30, 2004, Request for Administrative Review, Request for Revocation of Antidumping Duty Order in Part, and Entry of Appearance. The Department also notes that SSI had zero or de minimis dumping margins in the first two PORs of this antidumping duty order and preliminarily finds that SSI has a zero or de minimis dumping margin for the current review. In the first administrative review (POR of May 3, 2001, through October 31, 2002 (POR 1)), the Department calculated an antidumping duty rate of 0.00 percent. See Certain Hot-Rolled Carbon Steel Flat Products From Thailand: Final Results and Partial Rescission of Antidumping Duty Administrative Review, 69 FR 19388 (April 13, 2004). The second administrative review (POR of November 1, 2002 through October 31, 2003 (POR 2)) was rescinded on April 7, 2004, and therefore no antidumping duty margin was calculated. See Certain Hot-Rolled Carbon Steel Flat Products from Thailand: Rescission of Antidumping Duty Administrative Review, 69 FR 18349 (April 7, 2004). The Department’s Regulations provide that the Department need not conduct an administrative review of an intervening year before deciding to revoke an order as long as shipments, ‘‘during each of the three (or five) years, there were exports to the United States in commercial quantities of the subject merchandise to which a revocation or termination will apply.’’ See 19 CFR § 351.222(d)(1). An intervening year is defined as ‘‘any year between the first and final year of the consecutive period on which revocation or termination is conditioned.’’ See 19 CFR § 351.222(d)(2). In the present case, POR 2 of the antidumping order on hotrolled steel constitutes the intervening E:\FR\FM\09DEN1.SGM 09DEN1 73202 Federal Register / Vol. 70, No. 236 / Friday, December 9, 2005 / Notices year. Therefore, in accordance with 19 CFR § 351.222(d)(2), the rescission of the review for POR 2 does not interrupt the three consecutive year period required by 19 CFR 351.222(b)(2)(i). Provided the Department does not find dumping in POR 3, SSI will have sold subject merchandise at not less than normal value for a period of at least three consecutive years and satisfied 19 CFR § 351.222(b)(2). For POR 3, the Department has preliminarily concluded that SSI did not make sales below normal value. Therefore, the Department preliminarily concludes that SSI has satisfied the requirements of 19 CFR § 351.222(b)(2)(i) as it relates to the requirement of not selling at less than normal value for three consecutive years. Additionally, the Department has analyzed the volume of subject merchandise sold to the United States during the three consecutive periods of review, comparing these volumes with the volumes sold during the POI. The Department has preliminarily determined that SSI sold in commercial quantities. The Department has also preliminarily determined that SSI is not likely to sell subject merchandise at less than normal value in the future, thereby satisfying the requirements of 19 CFR § 351.222(b)(2). See Department’s Position Regarding Commercial Quantities and Department’s Position Regarding Likelihood of Future Dumping below for a complete analysis. Analysis Nucor concedes that if SSI has sold subject merchandise at not less than normal value for the current POR, it will partially satisfy the requirements of 19 C.F.C § 351.222(b)(2). Nucor, however, argues that SSI has not met its burden of shipping in commercial quantities and that SSI will likely sell subject merchandise at less than normal value in the future. Therefore, Nucor maintains that SSI has failed to satisfy entirely the requirements of 19 CFR § 351.222(b)(2) (relating to commercial quantities and the likelihood of future dumping). With regard to the commercial quantities requirement of 19 CFR § 351.222(b)(2)(i) and 19 CFR § 351.222(e)(ii), Nucor argues that a party requesting revocation must demonstrate that it ‘‘meaningfully participated in the marketplace.’’ See Certain Cold-Rolled and Corrosion Resistant Carbon Steel Flat Products From Korea, 66 FR 3540 (January 16, 2001). Nucor maintains that in comparison to other foreign producers/ exporters of hot-rolled coil and the hotrolled coil market, SSI did not continue VerDate Aug<31>2005 14:22 Dec 08, 2005 Jkt 208001 ‘‘normal’’ commercial activity after imposition of the antidumping order, did not export hot-rolled steel to the U.S. in commercial quantities, and did not meaningfully participate in the U.S. hot-rolled market during each of the consecutive administrative reviews subsequent to this antidumping order. See page 4 of Nucor’s July 21, 2005, submission. Rather than looking at contract date, invoice date or shipment date, as SSI provided in its April 19, 2005 submission, Nucor argues that entry date is a more commercially accurate date to determine whether or not SSI shipped in commercial quantities. Nucor contends that entry date reflects the date that the subject merchandise physically entered the U.S. market, competes directly with U.S. producers, and becomes economically relevant. While SSI did not provide the entry date for its U.S. sales, Nucor maintains that the Department can use Bureau of Census (BC) data to analyze whether or not SSI shipped in commercial quantities. Nucor contends that SSI accounted for a majority of sales represented in BC data for the POI, and accounted for all shipments represented in BC data for the first, second, and third PORs, allowing the Department to review this public data and use it for an analysis. Nucor contends that SSI either made no shipments or ‘‘sporadic’’ shipments during POR 1. See page 8 of Nucor’s July 21, 2005, submission. Nucor argues that there was a ‘‘dramatic’’ drop in imports of hot-rolled steel from Thailand when comparing the POI to POR 1 and POR 3. Id. Nucor contends that shipments of hot-rolled steel from Thailand were low when compared to imports from other countries subject to the antidumping duty order. Id. Nucor argues that SSI’s share of U.S. domestic apparent consumption remained low during the three POR’s of this antidumping order, and 67 percent below the level maintained during the POI. See page 9 of Nucor’s July 21, 2005, submission. Nucor further argues that SSI’s share of hot-rolled imports into the U.S. market fell during the three PORs of this antidumping duty order compared to its level of U.S. market share during the POI. Id. Nucor maintains, therefore, that SSI has not demonstrated that it has made sales in commercial quantities during POR 1 and POR 3. SSI argues that it has exported subject merchandise to the United States in commercial quantities during the three consecutive administrative reviews of this antidumping duty order. SSI contends that regardless of how quantities are analyzed, using contract, PO 00000 Frm 00009 Fmt 4703 Sfmt 4703 invoice or shipment date, SSI has exported in commercial quantities that meet the requirements of 19 CFR § 351.222(b)(2)(i) and 19 CFR § 351.222(e)(ii). See page 2 of SSI’s July 21, 2005 submission. In its August 1, 2005 rebuttal comments, SSI argues that the Department is required to review sales by the company, not countrywide entry data from the BC. SSI contends that pursuant to 19 CFR. § 351.222(e), a producer/exporter must certify that it sold subject merchandise to the United States at not less than fair value during the POR and will not do so in the future. SSI maintains that the Department requires a review of sales, not entries of subject merchandise. Additionally, SSI maintains that BC countrywide entry data include entries from all Thai exporters and cannot be divided among specific producers/ exporters. SSI contends, therefore, that using BC data is inaccurate. SSI also argues that Nucor’s argument involving imports of hot-rolled steel from other countries, and those countries selling activities and market share is irrelevant as the Department must only analyze the exporter’s or producer’s specific behavior under the order. In determining whether three years of no dumping establish a sufficient basis to make a revocation determination, the Department must be able to determine that the company continued to participate meaningfully in the U.S. market during each of the three years at issue. See Certain Corrosion-Resistant Carbon Steel Flat Products from Canada; Final Results of Antidumping Administrative Review and Determination to Revoke in Part, 64 FR 2173, 2175 (Jan. 13, 1999) (Carbon Steel from Canada). This practice has been codified in section 351.222(d)(1) of the Department’s regulations, which states that, ‘‘before revoking an order or terminating a suspended investigation, the Secretary must be satisfied that, during each of the three (or five) years, there were exports to the United States in commercial quantities of the subject merchandise to which a revocation or termination will apply.’’ 19 CFR 351.222(d)(1); see also 19 CFR 351.222(e)(1)(ii). For purposes of revocation, the Department must be able to determine that past margins are reflective of a company’s normal commercial activity. See Carbon Steel from Canada, 64 FR at 2175. Sales during a POR that, in the aggregate, are of an abnormally small quantity, either in absolute terms or in comparison to an appropriate benchmark period, do not generally provide a reasonable basis for determining that the discipline of the E:\FR\FM\09DEN1.SGM 09DEN1 Federal Register / Vol. 70, No. 236 / Friday, December 9, 2005 / Notices order is no longer necessary to offset dumping. Id.; see also Pure Magnesium From Canada, 64 FR 12977 (March 16, 1999). However, the determination as to whether or not sales volumes are made in commercial quantities is made on a case-by-case basis, based on the unique facts of each proceeding. See Dynamic Random Access Memory Semiconductors of One Megabyte or Above From the Republic of Korea: Final Results of Antidumping Duty Administrative Review and Determination Not To Revoke Order In Part, 62 FR 39809, 39812 (July 24, 1997) (DRAMS from Korea). Neither the statute nor the Department’s regulations prescribes a specific standard for determining whether sales have been made in commercial quantities. See section 751(d) of the Act; 19 CFR 351.222. In many instances, the Department will use the original POI (i.e., pre-order shipment levels) as a benchmark for a company’s normal commercial behavior, because the period of investigation generally provides a valid benchmark for assessing whether sales have been made in commercial quantities. See Carbon Steel from Canada, 64 FR at 2175. In the present case, the Department has followed this practice and used POI levels as a benchmark for determining whether SSI made sales to the United States in commercial quantities during each of the three periods of review covered by this antidumping order. SSI’s sales volumes were verified during POR 1 and POR 3, and placed on the record, along with POI and POR 2 sales volumes, in SSI’s April 19, 2005, submission. Additionally, the Department is using pricing data from Purchasing Magazine to supplement its analysis, which was placed on the record in a memorandum to the file dated November 30, 2005.2 The Department found that the volume of merchandise, based on either shipment date or sale invoice date, sold to the United States during POR 1 was about one-half of the volume sold during the POI. The volume sold increased during POR 2 to about 65 2 With regard to SSI’s objection to Nucor’s July 21, 2005 submission, pursuant to 19 CFR 351.301(c)(2)(i) ‘‘the Secretary may request any person to submit factual information at any time during a proceeding.’’ On July 1, 2005, the Department requested that parties submit comments, regarding SSI’s revocation request, by July 21, 2005. Nucor responded to this request from the Department by filing comments by the Department’s deadline. Therefore, the Department considers petitioners July 21, 2005 submission to be responsive to a request from the Department and, therefore, accepts it for purposes analyzing SSI’s revocation request. VerDate Aug<31>2005 14:22 Dec 08, 2005 Jkt 208001 percent of the volume sold during the POI. Finally, during POR 3, the volume sold increased further to about 80 percent of the volume sold during the POI. While the volume of sales dropped from the POI to the three PORs, we find that the volume of sales shipped in the three PORs is a relatively high percentage of the POI volume of sales. SSI’s sales volumes during any one of the three PORs never dropped to below 41 percent of POI volume when using shipment date or invoice date to compare volumes. Moreover, based on shipment date, the volume of hot-rolled steel SSI sold to the United States between POR 1, POR 2 and POR 3 increased steadily. We disagree with Nucor’s argument that SSI either made no shipments or ‘‘sporadic’’ shipments during POR 1. The Department considers the entire period of review, not just a segment of the period, when reviewing sales in an administrative review. Fluctuations in sales may occur during a review period, which is why the Department considers the entire period of review to conduct its analysis and not just certain months of a period. In our view, a determination of whether a company participates meaningfully in the market is more accurately made by examining the company’s volume throughout a POR, rather than by segmenting the data and its benchmarks into monthly periods. The Department, therefore, preliminary concludes that SSI has shipped in commercial quantities during three consecutive years and has satisfied the requirements of 19 CFR § 351.222(b)(2)(i) and 19 CFR § 351.222(e)(ii). In its July 21, 2005 submission, Nucor argues that the market for steel products is cyclical and that dumping will likely occur if this antidumping duty order with respect to SSI is revoked. See page 11 of Nucor’s July 21, 2005, submission. Reviewing the period of October 1999 through January 2001, Nucor contends that average apparent consumption of hot-rolled steel in the United States declined 13.8 percent while imports from Thailand increased 417 percent. See page 12 of Nucor’s July 21, 2005, submission. Nucor argues, therefore, that SSI’s sales of dumped products increased significantly during the U.S. market downturn and suggests that Thai producers of hot-rolled steel are likely to increase sales and reduce prices in order to maintain sales in a weak market environment. See page 12 of Nucor’s July 21, 2005, submission. Nucor further contends that the administrative review periods are characterized by falling prices and hence, dumping of hot-rolled steel. PO 00000 Frm 00010 Fmt 4703 Sfmt 4703 73203 Citing Purchasing Magazine and American Metal Market, Nucor maintains that prices for hot-rolled products, after being relatively high between 2001 and 2004, peaked in August 2004 and have begun to fall and will continue to fall into 2006. See page 13 of Nucor’s July 21, 2005, submission. Nucor also argues that U.S. consumption and output are falling; Nucor claims that between March and May 2005, U.S. consumption and shipments fell, portending low prices for hot-rolled sheet. See pages 14–15 of Nucor’s July 21, 2005, submission. Additionally, Nucor maintains that U.S. inventories remain high, with steel service centers holding inventories of 15.5 million tons as of May 2005. At the same time, Nucor claims that SSI is expanding its steel capacity. Therefore, Nucor claims that high inventory and production expansion will lead to future dumping. See pages 15–16 of Nucor’s July 21, 2005, submission. Nucor argues that while Chinese demand fueled the rise in prices for hotrolled steel over the last several years, the price of steel will decline because the demand for hot-rolled steel in China has ‘‘cooled.’’ See page 17 of Nucor’s July 21, 2005, submission. Moreover, Nucor contends that China has increased exports worldwide and reduced imports of hot-rolled steel, lowering prices in the Asian market, and leading to a reduction of demand for Thai hot-rolled steel in China. Additionally, Nucor contends that SSI will have to compete with China for export markets, a fact which has already led to an increase in exports of hotrolled steel from Thailand to the United States in 2004. See page 18 of Nucor’s July 21, 2005, submission. Nucor contends that China is expected to add an additional 48 million metric tons of capacity in 2005, further increasing competition among countries exporting hot-rolled steel to the United States. Nucor contends that SSI is expanding steel production capacity and incurring higher fixed costs (inventory) and slab costs. Coupled with current falling prices in the United States for hot-rolled steel, Nucor maintains that SSI must sell at dumped prices in order to remain competitive. See pages 20–21 of Nucor’s July 21, 2005, submission. Based on this information, Nucor contends that SSI is likely to sell in the United States at less than normal value in the future and, therefore, the Department should not revoke this antidumping order with respect to SSI. SSI argues that the continued application of the antidumping duty order, as it regards SSI, is not otherwise necessary to offset dumping. SSI E:\FR\FM\09DEN1.SGM 09DEN1 73204 Federal Register / Vol. 70, No. 236 / Friday, December 9, 2005 / Notices contends that despite the continued commercial presence of SSI’s exports of hot-rolled steel to the United States, market prices for hot-rolled steel have risen dramatically. See page 3 of SSI’s July 21, 2005, submission. SSI contends that while imports rose between POR 1 and POR 3, U.S. market prices tripled, from an average of $215 to $714 per net ton, demonstrating that SSI’s increased presence in the U.S. market has had no impact on U.S. prices. SSI maintains that demand in Thailand has increased as well, increasing every year since the original POI, with consumption also growing during the same time period. See page 3 of SSI’s July 21, 2005, submission. SSI argues that the U.S. hot-rolled steel industry had an operating profit of $7.5 billion, while increasing capacity, production, capacity utilization and shipments between 2003 and 2004. SSI argues that Nucor is expanding operations in the United States with regards to hot-rolled steel production, all while exports of hot-rolled steel to the United States increased without dumping. SSI argues that when sales during the course of three administrative reviews have not been made at less than normal value and there are sales in commercial quantities from the investigated producer, 19 CFR § 351.222(b)(2) creates a presumption that the antidumping duty order is not necessary to offset dumping. SSI maintains that these facts are present in this case and, therefore, Nucor must present some compelling and substantial evidence regarding SSI’s behavior under the antidumping duty order. SSI argues that Nucor has failed to do so in the present case and the Department should conclude that the continued application of the antidumping order is not otherwise necessary to offset dumping. SSI maintains that Nucor’s argument concerning abnormally high prices in the U.S. market, and market conditions in China, are macro-economic issues and are irrelevant to SSI’s behavior under the current antidumping duty order. SSI further argues that Nucor has failed to provide any substantial evidence that China has had any impact specifically on SSI’s behavior under the antidumping order. SSI concludes, therefore, that the presumption that the antidumping duty order is necessary to offset dumping has been overcome and the Department should revoke the antidumping order as it pertains to SSI. SSI argues that U.S. market prices for hot-rolled steel rose dramatically, despite the presence of SSI’s commercially significant exports to the U.S. market. Additionally, SSI VerDate Aug<31>2005 14:22 Dec 08, 2005 Jkt 208001 maintains that home market demand in Thailand has increased. SSI contends that based on these market conditions, there is no incentive for SSI to begin dumping should the antidumping duty order be revoked. SSI maintains that even though prices have fallen recently, this is a correction in the market that is natural after having such high hot-rolled prices over the past year and a half. SSI argues that it did not sell at less than normal value during times when the prices were relatively low. SSI further argues that the relatively high current prices do not mean it will dump in the future. With respect to 19 CFR 351.222(b)(1)(ii) and the likelihood of future dumping, the Department may consider such ‘‘factors as conditions and trends in the domestic and home market industries, currency movements, and the ability of the foreign entity to compete in the U.S. marketplace without sales at less than normal value.’’ See Steel Wire Rope From the Republic of Korea; Final Results of Antidumping Duty Administrative Review and Revocation in Part of Antidumping Duty Order, 63 FR 17986, 17988 (April 13, 1998) citing Brass Sheet and Strip from Germany, 61 FR 49727, 49730 (Sept. 23, 1996); see also Proposed Regulation Concerning the Revocation of Antidumping Duty Orders, 64 FR 29818, 29820 (June 3, 1999) (explaining that when additional evidence as to whether the continued application of an antidumping duty order is necessary to offset dumping is placed on the record, ‘‘the Department may consider trends in prices and costs, investment, currency movements, production capacity, as well as all other market and economic factors relevant to a particular case.’’); and Brass Sheet and Strip from Canada: Preliminary Results of Antidumping Duty Administrative Review and Notice of Intent to Revoke Order in Part, 63 FR 6519, 6523 (February 9, 1998). Thus, based upon three consecutive reviews of zero or de minimis margins, the Department presumes that dumping is not likely to resume unless the Department has been presented with evidence to demonstrate that dumping is likely to resume if the order were revoked. We have reviewed the briefs presented by Nucor and respondent and preliminarily find no evidence to indicate the likelihood of future dumping. The Department analyzed SSI’s sales volumes during the three PORs of the antidumping duty order and preliminarily determined that SSI has been able to sell in commercial quantities at not less than normal value regardless of how high or low U.S. PO 00000 Frm 00011 Fmt 4703 Sfmt 4703 prices are at the time (i.e., during a downward trend in the market). In DRAMS from Korea, a downward trend occurred in the market, with a resultant drop in U.S. prices. During this time, respondent sold subject merchandise at less than fair value in the United States in order to maintain its market share. Id. In the present review, this situation has not occurred. While prices have risen and fallen over the life of the antidumping order, SSI has continued to sell at not less than normal value and in commercial quantities. Upon a review of Purchasing Magazine data, during the POI hot-rolled steel ranged in price from $270 to $340 per net ton. During the life of the antidumping order, the price of hot-rolled steel in the United States has been as low as $210 per net ton and as high as $756 per net ton, with SSI selling in large quantities when U.S. market prices were as low as $300 and as high as $714 per net ton. See exhibits 1 and 4 of Nucor’s July 21, 2005, submission. Selling in the United States when market prices were at these levels demonstrates that SSI has participated meaningfully in the U.S. market and has sold in commercial quantities when the price for hot-rolled steel has been both high and low in the U.S. market. Nucor argues that between August 2004 and June 2005, U.S. prices for hotrolled steel decreased. Nucor contends that dropping prices are a trend that is likely to continue and lead to dumping by SSI in order to retain market share. While prices have declined over the past year and a half, recent pricing data from Purchasing Magazine shows that prices have increased, by as much as $100 net ton between August and November 2005. See Attachment to the Department’s November 30, 2005, Memorandum to the File regarding data used by the Department in its revocation analysis. Moreover, SSI has been able to export to the United States hot-rolled steel in large quantities at not less than fair value during the life of the antidumping duty order. Based on the above analysis, we preliminarily find that SSI has satisfied the commercial quantities requirement and the likelihood of future dumping requirement of 19 CFR. § 351.222(b)(2). Therefore, the Department has preliminarily determined to revoke the antidumping duty order on hot-rolled steel with respect to SSI. Currency Conversion We made currency conversions into U.S. dollars, in accordance with section 773A(a) of the Act, based on the exchange rates in effect on the dates of E:\FR\FM\09DEN1.SGM 09DEN1 Federal Register / Vol. 70, No. 236 / Friday, December 9, 2005 / Notices the U.S. sales, as certified by the Federal Reserve Bank. Preliminary Results of Review As a result of our review, we preliminarily determine the weightedaverage dumping margin for the period November 1, 2003, through October 31, 2004, to be as follows: Manufacturer / Exporter Margin (percent) Sahaviriya Steel Industries Public Company Limited 0.01 (de minimis) The Department will disclose calculations performed in connection with these preliminary results of review within five days of the date of publication of this notice in accordance with 19 CFR 351.224(b). Interested parties may submit case briefs and/or written comments no later than 30 days after the date of publication of these preliminary results of review. Rebuttal briefs and rebuttals to written comments, limited to issues raised in the case briefs and comments, may be filed no later than 35 days after the date of publication of this notice. Parties who submit argument in these proceedings 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. An interested party may request a hearing within 30 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. The Department will issue the final results of these preliminary results, including the results of our analysis of the issues raised in any such written comments or at a hearing, within 120 days of publication of these preliminary results. Assessment Rates Cash Deposit Requirements If the final results remain unchanged from these preliminary results, no future cash deposits will be required for the subject merchandise with respect to SSI. 14:22 Dec 08, 2005 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 antidumping duties. We are issuing and publishing this notice in accordance with sections 751(a)(1) and 777(i)(1) of the Act. Dated: November 30, 2005. Stephen J. Claeys, Acting Assistant Secretary for Import Administration. [FR Doc. 05–23876 Filed 12–8–05; 8:45 am] BILLING CODE 3510–DS–S DEPARTMENT OF COMMERCE The Department shall determine, and CBP shall assess, antidumping duties on all appropriate entries. Pursuant to section 351.212(b) of the Department’s regulations, the Department calculates an assessment rate for each importer of the subject merchandise for each respondent. The Department will issue appropriate assessment instructions directly to CBP within 15 days of publication of the final results of review. VerDate Aug<31>2005 For all other previously reviewed or investigated companies not part of this administrative review, or exporters not covered by this review who sell subject merchandise produced by a manufacturer who is subject to this or any other review or the less than fair value (LTFV) investigation, but not a part of this administrative review, pursuant to 751(a)(1) of the Act, the cash deposit rate will be the companyspecific rate established for the most recent period. If neither the exporter nor the manufacturer is a firm covered in this review, any previous reviews, or the LTFV investigation, the cash deposit rate will be 3.86 percent, the ‘‘all others’’ rate established in the LTFV investigation. See Hot Rolled Steel Order. These deposit rates, when imposed, shall remain in effect until publication of the final results of the next administrative review. Jkt 208001 International Trade Administration (A–583–830) Stainless Steel Plate in Coils from Taiwan; Final Rescission of Antidumping Duty Administrative Review Import Administration, International Trade Administration, Department of Commerce. EFFECTIVE DATE: December 9, 2005. FOR FURTHER INFORMATION CONTACT: Elizabeth Eastwood or Nichole Zink, AD/CVD Operations, Office 2, Import Administration, International Trade Administration, U.S. Department of AGENCY: PO 00000 Frm 00012 Fmt 4703 Sfmt 4703 73205 Commerce, 14th Street and Constitution Avenue, NW., Washington, DC, 20230; telephone (202) 482–3874 or (202) 482– 0049, respectively. SUPPLEMENTARY INFORMATION: Background This review covers the following fifteen manufacturers/exporters: Chain Chon Industrial Co., Ltd., Chang Mien Industries Co., Ltd., Chien Shing Stainless Steel Co., Ltd., China Steel Corporation, East Tack Enterprise Co., Goang Jau Shing Enterprise Co., Ltd., PFP Taiwan Co., Ltd., Shing Shong Ta Metal Ind. Co., Ltd., Sinkang Industries, Ltd., Ta Chen Stainless Pipe Ltd. (Ta Chen), Tang Eng Iron Works Co., Ltd., Yieh Loong Enterprise Co., Yieh Mau Corp., Yieh Trading Co., and Yieh United Steel Corp. On June 7, 2005, the Department published in the Federal Register the preliminary rescission of administrative review on stainless steel plate in coils from Taiwan. See Stainless Steel Plate in Coils from Taiwan; Preliminary Rescission of Antidumping Duty Administrative Review, 70 FR 33083 (June 7, 2005) (Preliminary Results). We invited parties to comment on our preliminary rescission of this administrative review. In July 2005, we received a case brief from the petitioners (Allegheny Ludlum Corp., United Auto Workers Local 3303, Zanesville Armco Independent Organization, the United Steelworkers of America, and AFL–CIO/ CLC). On October 5, 2005, the Department postponed the final results of the administrative review. See Stainless Steel Plate in Coils from Taiwan; Notice of Extension of Time Limits for Final Results of Antidumping Duty Administrative Review, 70 FR 58189 (Oct. 5, 2005). On October 31, 2005, we placed new factual information on the record of this administrative review, and we invited parties to comment on it. On November 7, 2005, the petitioners submitted a letter in accordance with this request. However, on November 10, 2005, we rejected the petitioners’ submission because we determined that it was not directly related to the new factual information, but instead contained both new information and argumentation related to the general issue raised in their case brief. Therefore, we found that the petitioners’ submission was unresponsive and thus it constituted untimely filed new factual information and argument pursuant to 19 CFR 351.301(b)(2). After examining the information on the record, we continue to find that none of the companies noted above had E:\FR\FM\09DEN1.SGM 09DEN1

Agencies

[Federal Register Volume 70, Number 236 (Friday, December 9, 2005)]
[Notices]
[Pages 73197-73205]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 05-23876]


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DEPARTMENT OF COMMERCE

International Trade Administration

A-549-817


Certain Hot-Rolled Carbon Steel Flat Products From Thailand; 
Preliminary Results of Antidumping Duty Administrative Review and 
Intent to Revoke and Rescind in Part

AGENCY: Import Administration, International Trade Administration, 
Department of Commerce.
SUMMARY: In response to requests from Sahaviriya Steel Industries 
Public Company Limited (SSI), United States Steel Corporation 
(petitioner), and Nucor Corporation (domestic interested party 
(Nucor)), the Department of Commerce (the Department) is conducting an 
administrative review of the antidumping duty order on certain hot-
rolled carbon steel flat products (hot-rolled steel) from Thailand. 
This administrative review covers imports of subject merchandise 
produced and exported by SSI.
    We preliminarily determine that sales of subject merchandise by SSI 
have been made at not less than normal value (NV). Because SSI made 
sales at not less than NV for three consecutive years during the 
antidumping duty order, we are preliminarily revoking the order on hot-
rolled steel from Thailand with respect to SSI. See Intent to Revoke 
with Respect to SSI below. In addition, we are preliminarily rescinding 
this review with respect to Nakornthai Strip Mill Public Co., Ltd. 
(Nakornthai) and G Street Public Company Limited (formerly Siam Strip 
Mill Public Co., Ltd.) (G Street), because both companies reported, and 
we confirmed, that neither made shipments of subject merchandise to the 
United States during the POR. If these preliminary results are adopted 
in our final results, we will instruct U.S. Customs and Border 
Protection (CBP) to assess antidumping duties on appropriate entries 
based on the difference between the export price (EP) and the NV. 
Interested parties are invited to comment on these preliminary results. 
Parties who submit argument in this proceeding are requested to submit 
with the argument: 1) a statement of the issues, 2) a brief summary of 
the argument, and 3) a table of authorities.

EFFECTIVE DATE: December 9, 2005.

FOR FURTHER INFORMATION CONTACT: Stephen Bailey or Abdelali Elouaradia, 
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-
0193 or (202) 482-1374, respectively.

SUPPLEMENTARY INFORMATION:

Background

    On November 29, 2001, the Department published the antidumping duty 
order on hot-rolled steel from Thailand. See Notice of Antidumping Duty 
Order: Certain Hot-Rolled Carbon Steel Flat Products From Thailand, 66 
FR 59562 (November 29, 2001) (Hot-Rolled Steel Order). On November 1, 
2004, the Department published the opportunity to request 
administrative review of, inter alia, hot-rolled steel from Thailand 
for the period November 1, 2003, through October 31, 2004. See 
Antidumping or Countervailing Duty Order, Finding, or Suspended 
Investigation; Opportunity to Request Administrative Review, 69 FR 
63359 (November 1, 2004).
    In accordance with 19 CFR 351.213(b)(1), on November 30, 2004, SSI, 
petitioner, and Nucor requested that we conduct an administrative 
review of SSI's sales of the subject merchandise. In its administrative 
review request, petitioner requested that we also review sales of 
Nakornthai and G Street. On November 30, 2004, SSI requested that the 
antidumping duty order on hot-rolled steel, as it relates to SSI, be 
revoked based on the absence of dumping, and included with its request 
certain company certifications regarding revocation. On December 27, 
2004, the Department published in the Federal Register a notice of 
initiation of this antidumping duty administrative review covering the 
period November 1, 2003, through October 31, 2004. See Initiation of 
Antidumping and Countervailing Duty Administrative Reviews and Request 
for Revocation in Part, 69 FR 77181 (December 27, 2004).
    On January 6, 2005, the Department issued its antidumping duty 
questionnaire to SSI, Nakornthai, and G Street. On January 8 and 20, 
2005, respectively, Nakornthai and G Street submitted no-shipment 
certification letters to the Department indicating that they had no 
sales of subject merchandise during the POR and requesting a rescission 
of the administrative review with respect to each company. SSI 
submitted its response to Section A of the questionnaire (Section A 
response) on January 27, 2005, and its responses to Sections B and C 
(Sections B and C responses) on February 22, 2005. SSI submitted its 
response to Section D of the questionnaire (Section D response) on 
February 28, 2005. The Department issued a supplemental Sections A 
through C questionnaire to SSI on April 13, 2005, and received SSI's 
response on May 16, 2005. The Department issued a supplemental Section 
D questionnaire to SSI on April 28, 2005, and SSI submitted its 
response on May 20, 2005. The Department issued a second Sections A 
through C supplemental questionnaire on June 17, 2005, and SSI 
submitted its response on June 24, 2005.
    On April 19, 2005, SSI submitted factual information with respect 
to revocation of the underlying antidumping duty order as it pertains 
to SSI. On July 1, 2005, the Department requested that parties submit 
comments regarding revocation by July 21, 2005. On July 21, 2005, both 
SSI and Nucor submitted comments on revocation. Petitioner did not 
submit comments. On August 1, 2005, SSI submitted comments to rebut 
Nucor's July 21, 2005 submission. Petitioner and Nucor did not submit 
rebuttal comments.

Period of Review

    The period of review is November 1, 2003, through October 31, 2004.

Scope of the Order

    For purposes of this review, the products covered are certain hot-
rolled carbon steel flat products of a rectangular shape, of a width of 
0.5 inch or greater, neither clad, plated, nor coated with metal and 
whether or not painted, varnished, or coated with plastics or other 
non-metallic substances, in coils (whether or not in successively 
superimposed layers), regardless of thickness, and in straight lengths, 
of a thickness of less than 4.75 mm and of a width measuring at least 
10 times the thickness. Universal mill plate (i.e., flat-rolled 
products rolled on four faces or in a closed box pass, of a width 
exceeding 150 mm, but not exceeding 1250 mm, and of a thickness of not 
less than 4.0 mm, not in coils and without patterns in relief) of a 
thickness not less than 4.0 mm is not included within the scope of this 
review.

[[Page 73198]]

    Specifically included within the scope of this review are vacuum 
degassed, fully stabilized (commonly referred to as interstitial-free 
(IF)) steels, high strength low alloy (HSLA) steels, and the substrate 
for motor lamination steels. IF steels are recognized as low carbon 
steels with micro-alloying levels of elements such as titanium or 
niobium (also commonly referred to as columbium), or both, added to 
stabilize carbon and nitrogen elements. HSLA steels are recognized as 
steels with micro-alloying levels of elements such as chromium, copper, 
niobium, vanadium, and molybdenum. The substrate for motor lamination 
steels contains micro-alloying levels of elements such as silicon and 
aluminum.
    Steel products to be included in the scope of this review, 
regardless of definitions in the Harmonized Tariff Schedule of the 
United States (HTSUS), are products in which: i) iron predominates, by 
weight, over each of the other contained elements; ii) the carbon 
content is 2 percent or less, by weight; and iii) 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 of vanadium, or
0.15 percent of zirconium.
    All products that meet the physical and chemical description 
provided above are within the scope of this review unless otherwise 
excluded. The following products, by way of example, are outside or 
specifically excluded from the scope of this review:
     Alloy hot-rolled steel products in which at least one of 
the chemical elements exceeds those listed above (including, e.g., 
American Society for Testing and Materials (ASTM) specifications A543, 
A387, A514, A517, A506).
     Society of Automotive Engineers (SAE)/American Iron & 
Steel Institute (AISI) grades of series 2300 and higher.
     Ball bearing steels, as defined in the HTSUS.
     Tool steels, as defined in the HTSUS.
     Silico-manganese (as defined in the HTSUS) or silicon 
electrical steel with a silicon level exceeding 2.25 percent.
     ASTM specifications A710 and A736.
     USS abrasion-resistant steels (USS AR 400, USS AR 500).
     All products (proprietary or otherwise) based on an alloy 
ASTM specification (sample specifications: ASTM A506, A507).
     Non-rectangular shapes, not in coils, which are the result 
of having been processed by cutting or stamping and which have assumed 
the character of articles or products classified outside chapter 72 of 
the HTSUS.
    The merchandise subject to this review is classified in the HTSUS 
at subheadings: 7208.10.15.00, 7208.10.30.00, 7208.10.60.00, 
7208.25.30.00, 7208.25.60.00, 7208.26.00.30, 7208.26.00.60, 
7208.27.00.30, 7208.27.00.60, 7208.36.00.30, 7208.36.00.60, 
7208.37.00.30, 7208.37.00.60, 7208.38.00.15, 7208.38.00.30, 
7208.38.00.90, 7208.39.00.15, 7208.39.00.30, 7208.39.00.90, 
7208.40.60.30, 7208.40.60.60, 7208.53.00.00, 7208.54.00.00, 
7208.90.00.00, 7211.14.00.90, 7211.19.15.00, 7211.19.20.00, 
7211.19.30.00, 7211.19.45.00, 7211.19.60.00, 7211.19.75.30, 
7211.19.75.60, and 7211.19.75.90. Certain hot-rolled carbon steel flat 
products covered by this review, including: vacuum degassed fully 
stabilized; high strength low alloy; and the substrate for motor 
lamination steel may also enter under the following tariff numbers: 
7225.11.00.00, 7225.19.00.00, 7225.30.30.50, 7225.30.70.00, 
7225.40.70.00, 7225.99.00.90, 7226.11.10.00, 7226.11.90.30, 
7226.11.90.60, 7226.19.10.00, 7226.19.90.00, 7226.91.50.00, 
7226.91.70.00, 7226.91.80.00, and 7226.99.00.00. Subject merchandise 
may also enter under 7210.70.30.00, 7210.90.90.00, 7211.14.00.30, 
7212.40.10.00, 7212.40.50.00, and 7212.50.00.00. Although the HTSUS 
subheadings are provided for convenience and CBP purposes, the written 
description of the merchandise under review is dispositive.

Verification

    As provided in section 782(i) of the Tariff Act of 1930, as amended 
(the Act), we verified sales information from August 24, 2005, through 
August 29, 2005, and cost of production information from October 24, 
2005, through October 28, 2005, using standard verification procedures, 
including an examination of relevant sales, cost, financial records, 
and selection of original documentation containing relevant 
information. Our verification results are outlined in the public 
versions of the verification reports and are on file in the 
Department's Central Records Unit (CRU) located in Room B-099 of the 
main Department of Commerce Building, 14\th\ Street and Constitution 
Avenue, NW., Washington, DC.

Partial Rescission of Administrative Review

    As explained above, on January 8, 2005, Nakornthai submitted a 
statement that it had no sales to the United States during the POR. On 
January 20, 2005, G Street submitted a similar statement. The 
Department conducted a query of CBP data on entries of hot-rolled steel 
from Thailand made during the POR, and confirmed that Nakornthai and G 
Street made no entries during this period. Therefore, we are 
preliminarily rescinding this review with respect to Nakornthai and G 
Street in accordance with section 351.213(d)(3) of the Department's 
regulations.

Fair Value Comparisons

    To determine whether sales of subject merchandise were made in the 
United States at less than fair value, we compared the EP to the NV, as 
described in the ``Export Price'' and ``Normal Value'' sections of this 
notice. In accordance with section 777A(d)(1)(A)(i) of the Act, we 
calculated EP and compared these prices to weighted-average normal 
values or constructed values (CV), as appropriate.

Product Comparisons

    In accordance with section 771(16) of the Act, we considered all 
products produced by SSI covered by the descriptions in the ``Scope of 
the Order'' section of this notice to be foreign like products for the 
purpose of determining appropriate product comparisons to SSI's U.S. 
sales of the subject merchandise.
    We have relied on the following eleven criteria to match U.S. sales 
of the subject merchandise to sales in Thailand of the foreign like 
product: paint, quality, carbon, yield strength, thickness, width, cut-
to-length vs. coil, temper rolled, pickled, edge trim, and patterns in 
relief.
    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 the characteristics 
and reporting instructions listed in the Department's January 6, 2005, 
questionnaire.

Export Price

    In accordance with section 772 of the Act, we calculate either an 
EP or a CEP,

[[Page 73199]]

depending on the nature of each sale. Section 772(a) of the Act defines 
EP as the price at which the subject merchandise is first sold by the 
foreign exporter or producer before the date of importation to an 
unaffiliated purchaser in the United States, or to an unaffiliated 
purchaser for exportation to the United States. We have preliminarily 
determined that all of SSI's U.S. sales during the POR were EP sales.
    We calculated EP based on prices charged to the first unaffiliated 
U.S. customer. We used the final contract date as the date of sale. We 
based EP on the packed cost and freight (CFR) prices to the first 
unaffiliated purchasers outside Thailand. We made deductions for 
movement expenses in accordance with section 772(c)(2)(A) of the Act, 
including foreign inland freight and foreign brokerage and handling.

Duty Drawback

    Section 772(c)(1)(B) of the Act provides that EP shall be increased 
by ``the amount of any import duties imposed by the country of 
exportation which have been rebated, or which have not been collected, 
by reason of the exportation of the subject merchandise to the United 
States.'' The Department determines that an adjustment to U.S. price 
for claimed duty drawback is appropriate when a company can demonstrate 
that (1) the import duty and the rebate are directly linked to, and 
dependent upon, one another, and (2) there are sufficient imports of 
the imported material to account for the duty drawback received for the 
export of the manufactured product (the ``two pronged test''). See 
Rajinder Pipes Ltd. v. United States, 70 F. Supp. 2d 1350, 1358 (CIT 
1999). See also Certain Welded Carbon Standard Steel Pipes and Tubes 
from India: Final Results of New Shippers Antidumping Duty 
Administrative Review, 62 FR 47632 (September 10, 1997) and Federal 
Mogul Corp. v. United States, 862 F. Supp. 384, 409 (CIT 1994).
    During the POR, SSI received duty drawback for its U.S. sales under 
the Thai Board of Investment (BOI) duty drawback tax certificate 
program (TCP). Under the TCP, SSI applies to the BOI for a duty 
exemption for imported slab, with the BOI maintaining a running tally 
of SSI's requests for slab exemptions.\1\ When SSI intends to export 
finished material, it applies to the BOI requesting a duty exemption 
for the exported material. During verification, the Department found 
that SSI maintains its duty exemption records on a FIFO (first in first 
out) basis. Additionally, we noted that when SSI submits its 
application for duty drawback, SSI is not required by the Thai 
government to link the specific imported slab to the specific exported 
hot-rolled coil. Consistent with the Department's decision in Final 
Determination of Sales at Less Than Fair Value: Oil Country Tubular 
Good from Korea, 60 FR 33561 (June 28, 1995) (OCTG From Korea), to 
allow duty drawback even though the respondent could not link the 
particular exportation of subject merchandise back to a particular 
imported material, the Department concludes that for SSI's U.S. sales, 
the company uses a methodology consistent with Department practice for 
applying its duty drawback received upon export of subject merchandise 
to the United States. See also Far East Mach. II, 12 CIT at 975, 699 
F.Supp. at 312.
---------------------------------------------------------------------------

    \1\ SSI explained during verification that during the current 
POR it did not use the BOI 36 program used in previous PORs because 
it expired. See page 35 of the Department's Sales Verification 
Report dated November 28, 2005.
---------------------------------------------------------------------------

    SSI also meets the second criterion of the two-pronged test for its 
U.S. sales. All of SSI's hot-rolled steel is made from imported slab, 
which demonstrates that there are sufficient imports of material to 
account for duty drawback. See SSI's February 28, 2005, Section D 
questionnaire response at page D-8. Therefore, the Department 
preliminarily concludes that for SSI's U.S. sales, the company uses a 
methodology consistent with Department practice for applying duty 
drawback received upon export of subject merchandise to the United 
States. See Far East Machinery II, 12 Ct. Int'l Trade 972, 975, 699 
F.Supp. 309, 312; see also OCTG from Korea.

Normal Value

A. Home Market Viability
    To determine whether there is a sufficient volume of sales in the 
home market to serve as a viable basis for calculating NV, we compared 
SSI'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)(B) of the Act. Because SSI'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 for the subject merchandise, we 
determined the home market was viable. See Section A response at 
exhibit 1.
B. Arm's Length Sales
    SSI reported that it made sales in the home market to affiliated 
and unaffiliated end users and distributors/retailers during the POR. 
SSI reported the downstream sales of its affiliated reseller of the 
foreign like product and we have included them in our NV calculation. 
SSI also had sales to affiliated customers who consumed the hot-rolled 
steel in the production of non-subject merchandise. If any of these 
sales to affiliated customers in the home market were not made at arm's 
length prices, we excluded those sales from our analysis because we 
considered them to be outside the ordinary course of trade. To test 
whether these sales were made at arm's-length prices, we compared on a 
model-specific basis the starting prices of sales to affiliated and 
unaffiliated customers, net of all billing adjustments, early payment 
discounts, movement charges, direct selling expenses, and home market 
packing. Where prices to the affiliated party fell, on average, between 
98 percent and 102 percent, inclusive, of sale prices of the same or 
comparable merchandise sold by that exporter or producer to all 
unaffiliated customers, we determined that sales made to the related 
party were at arm's length. See Antidumping Proceedings: Affiliated 
Party Sales in the Ordinary Course of Trade, 67 FR 69186 (November 15, 
2002). We excluded sales to those customers who failed the arm's length 
test.
C. Cost of Production Analysis
    In the most recently completed segment, the Department determined 
that SSI made sales in the home market at prices below its cost of 
production (COP) and, therefore, excluded such sales from its 
calculation of NV. See Certain Hot-Rolled Carbon Steel Flat Products 
From Thailand: Final Results and Partial Rescission of Antidumping Duty 
Administrative Review, 69 FR 19388 (April 13, 2004). Therefore, the 
Department has reasonable grounds to believe or suspect, pursuant to 
section 773(b)(2)(A)(ii) of the Act, that SSI made sales in the home 
market at prices below the COP for this POR. As a result, in accordance 
with section 773(b)(1) of the Act, we examined whether SSI's sales in 
the home market were made at prices below the COP.
    In accordance with section 773(b)(3) of the Act, we calculated the 
weighted-average COP for each model based on the sum of SSI's material 
and fabrication costs for the foreign like product, plus amounts for 
selling expenses, general and administrative expenses (G&A), interest 
expenses and packing costs.
    We used the information from SSI's section D questionnaire and 
supplemental questionnaire responses to calculate COP, except for the 
following adjustments. For the preliminary results we have disallowed

[[Page 73200]]

the claimed offset to G&A for the gain on the bond redemption and the 
additional revenue from the scrap sales and have included all revenue 
from scrap sales in the denominator of the G&A expense rate 
calculation. We deducted the revenue from the scrap sales from SSI's 
reported total cost of manufacturing. For the financial expense ratio, 
we have also made the same changes to the cost of goods sold 
denominator described for the G&A expense rate calculation. For further 
discussion of these adjustments, see Memorandum to Neal Halper, from 
Michael P. Harrison and Trinette L. Ruffin, regarding Cost of 
Production and Constructed Value Calculation Adjustments for the 
Preliminary Results, on file in the Department's CRU located in Room B-
099 of the main Department of Commerce Building, 14\th\ Street and 
Constitution Avenue, NW., Washington, DC CRU, dated November 30, 2005.
    We compared the weighted-average COP figures to the home market 
sales prices of the foreign like product, as required under section 
773(b) of the Act, to determine whether these sales had been made at 
prices below COP. On a product-specific basis, we compared COP to home 
market prices, less any applicable movement charges, billing 
adjustments, taxes, and discounts and rebates.
    In determining whether to disregard home market sales made at 
prices below the COP, we examined, in accordance with sections 
773(b)(1)(A) and (B) of the Act, whether such sales were made in 
substantial quantities within an extended period of time, and whether 
such sales were made at prices which permitted the recovery of all 
costs within a reasonable period of time in the normal course of trade. 
Pursuant to section 773(b)(2)(C) of the Act, where less than 20 percent 
of SSI's home market sales of a given model were made at prices below 
the COP, we did not disregard any below-cost sales of that model 
because we determined that the below-cost sales were not made within an 
extended period of time in ``substantial quantities.'' Where 20 percent 
or more of SSI's home market sales of a given model were at prices less 
than COP, we disregarded the below-cost sales because: (1) they were 
made within an extended period of time in ``substantial quantities,'' 
in accordance with sections 773(b)(2)(B) and (C) of the Act, and (2) 
based on our comparison of prices to the weighted-average COPs for the 
POR, they were at prices which would not permit the recovery of all 
costs within a reasonable period of time, in accordance with section 
773(b)(2)(D) of the Act.
    Our cost test for SSI revealed that for home market sales of 
certain models, less than 20 percent of the sales of those models were 
made at prices below the COP. We therefore retained all such sales in 
our analysis and used them as the basis for determining NV. Our cost 
test also indicated that for certain models, more than 20 percent of 
the home market sales of those models were sold at prices below COP 
within an extended period of time and were at prices which would not 
permit the recovery of all costs within a reasonable period of time. 
Thus, in accordance with section 773(b)(1) of the Act, we excluded 
these below-cost sales from our analysis and used the remaining above-
cost sales as the basis for determining NV.
D. Price-to-Price Comparisons
    We matched all U.S. sales to NV. We calculated NV based on prices 
to unaffiliated customers. We adjusted gross unit price for billing 
adjustments, interest revenue, and the per-unit value of any post-
transaction complementary invoices (or credit notes) that were issued 
to adjust for any errors in the originating invoice. We made 
deductions, where appropriate, for foreign inland freight and 
insurance, pursuant to section 773(a)(6)(B) of the Act. In addition, we 
made adjustments for differences in cost attributable to differences in 
physical characteristics of the merchandise, pursuant to section 
773(a)(6)(C)(ii) of the Act and 19 CFR 351.411, as well as for 
differences in circumstances of sale (COS) as appropriate, in 
accordance with section 773(a)(6)(C)(iii) of the Act and 19 CFR 
351.410. 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.
E. Price-to-CV Comparisons
    In accordance with section 773(a)(4) of the Act, we based NV on CV 
if we were unable to find a contemporaneous comparison market match for 
the U.S. sale. We calculated CV based on the cost of materials and 
fabrication employed in producing the subject merchandise, selling, 
general and administrative (SG&A) expenses, interest expense and 
profit. In accordance with section 773(e)(2)(A) of the Act, we based 
SG&A expenses, interest and profit on the amounts SSI incurred and 
realized in connection with the production and sale of the foreign like 
product in the ordinary course of trade for consumption in Thailand. 
For selling expenses, we used the weighted-average home market selling 
expenses. Where appropriate, we made COS adjustments to CV in 
accordance with section 773(a)(8) of the Act and 19 CFR 351.410 of the 
Department's regulations.

Level of Trade

    In accordance with section 773(a)(1)(B) of the Act, to the extent 
practicable, we determine NV based on sales in the comparison market at 
the same level of trade (LOT) as the EP transaction or constructed 
export price (CEP) transaction. The LOT in the comparison market is the 
LOT of the starting-price sales in the comparison market or, when NV is 
based on CV, the LOT of the sales from which we derive SG&A expenses 
and profit. With respect to U.S. price for EP transactions, the LOT is 
also that of the starting-price sale, which is usually from the 
exporter to the importer. For CEP, the LOT is that of the constructed 
sale from the exporter to the importer.
    To determine whether comparison market sales are at a different LOT 
from U.S. sales, we examined stages in the marketing process and 
selling functions along the chain of distribution between the producer 
and the unaffiliated customer. 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, the Department makes an LOT adjustment in 
accordance with section 773(a)(7)(A) of the Act. For CEP sales, we 
examine stages in the marketing process and selling functions along the 
chain of distribution between the producer and the unaffiliated 
customer. We analyze whether different selling activities are 
performed, and whether any price differences (other than those for 
which other allowances are made under the Act) are shown to be wholly 
or partly due to a difference in LOT between the CEP and NV. Under 
section 773(a)(7)(A) of the Act, we make an upward or downward 
adjustment to NV for LOT if the difference in LOT involves the 
performance of different selling activities and is demonstrated to 
affect price comparability, based on a pattern of consistent price 
differences between sales at different LOTs in the country in which NV 
is determined. Finally, if the NV LOT is at a more advanced stage of 
distribution than the LOT of the CEP, but the data available do not 
provide an appropriate basis to determine an LOT adjustment, we reduce 
NV by the amount of indirect selling expenses incurred in the foreign 
comparison market on sales of the foreign like product, but by no more 
than the amount of the indirect selling

[[Page 73201]]

expenses incurred for CEP sales. See section 773(a)(7)(B) of the Act 
(the CEP offset provision).
    In analyzing differences in selling functions, we determine whether 
the LOTs identified by the respondent are meaningful. See Antidumping 
Duties; Countervailing Duties, Final Rule, 62 FR 27296, 27371 (May 19, 
1997). If the claimed LOTs are the same, we expect that the 7functions 
and activities of the seller should be similar. Conversely, if a party 
claims that 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 
Administrative Review, 65 FR 30068 (May 10, 2000). In the present 
review, SSI did not claim an LOT adjustment. See Sections B and C 
responses at B-51.
    SSI claimed one LOT in the U.S. market and two LOTs in the home 
market: LOT 1 includes sales through unaffiliated trading companies and 
direct sales to end-users and LOT 2 includes sales through affiliated 
trading companies and to service centers. SSI claimed that all U.S. 
sales are at the same LOT as LOT 1 in the home market. SSI reported 
four channels of distribution for home market sales made through LOT 1 
and LOT 2. The first channel of distribution was sales made through 
unaffiliated trading companies with two customer categories (i.e., 
unaffiliated end-users and service centers). The second channel of 
distribution was sales made through affiliated trading companies with 
two customer categories (i.e., unaffiliated end-users and service 
centers). The third channel of distribution was direct sales with two 
customer categories (i.e., affiliated and unaffiliated end-users and 
service centers). The fourth channel of distribution was direct sales 
with one customer category (i.e., affiliated end-users, resellers or 
service centers).
    Whether made directly or through affiliates, except for certain 
additional selling functions that affiliates provide to their 
unaffiliated customers, the Department finds that SSI reported similar 
selling activities for all home market sales. While SSI's direct sales 
(whether or not resold) and downstream sales in the home market involve 
different channels of distribution, these sales do not appear to 
involve significant differences in selling functions and therefore we 
consider these channels to represent one LOT. Additionally, after 
analyzing the selling functions SSI reported for its EP sales, we find 
that the level of trade for SSI's EP sales is the same as the LOT for 
all sales in the home market. Based upon the above analysis, we 
preliminarily conclude that the LOT for all EP sales is the same as the 
LOT for all sales in the home market. Accordingly, because we find the 
U.S. sales and home market sales to be at the same LOT, no LOT 
adjustment under section 773(a)(7)(A) of the Act is warranted for SSI. 
Due to the proprietary nature of the levels of these selling 
activities, for further analysis, see Memorandum To the File, From 
Stephen Bailey, Regarding Administrative Review of the Antidumping Duty 
Order on Certain Hot-Rolled Carbon Steel Flat Products from Thailand; 
Preliminary Results Analysis for SSI, November 30, 2005.

Intent to Revoke with Respect to SSI

    On November 30, 2004, SSI submitted a letter to the Department 
requesting revocation of the antidumping order in part, pursuant to 19 
CFR Sec.  351.222(b). Along with the revocation request, SSI submitted 
company certifications that: (1) the company sold subject merchandise 
at not less than NV during the POR, and that in the future it would not 
sell such merchandise at less than NV (see 19 CFR 351.222(e)(1)(i)); 
and (2) the company has sold the subject merchandise to the United 
States in commercial quantities during each of the past three years. 
See 19 CFR 351.222(e)(1)(ii). SSI also included a certification that 
the company agrees to immediate reinstatement of the order if, 
subsequent to revocation, the Department concludes that the company 
sold the subject merchandise at less than NV. See 19 CFR 
351.222(b)(iii); See also Attachment to SSI's November 30, 2004 Request 
for Administrative Review, Request for Revocation of Antidumping Duty 
Order in Part, and Entry of Appearance. Because SSI is not the sole 
exporter or producer subject to this antidumping order, the decision 
whether to revoke the order relates only to SSI.
    The Department ``may revoke, in whole or in part'' an antidumping 
duty order upon completion of a review under section 751 of the Act. 
While Congress has not specified the procedures that the Department 
must follow in revoking an order, the Department has developed 
procedures for revocation that are described in 19 CFR 351.222. This 
regulation requires, inter alia, that each exporter and producer 
covered by the order submit the following: (1) a certification that the 
company has sold the subject merchandise at not less than NV in the 
current review period and that the company will not sell at less than 
NV in the future; and (2) a certification that the company sold the 
subject merchandise in each of the three consecutive years forming the 
basis of the request in commercial quantities. See 19 CFR 
351.222(e)(1). Upon receipt of such a request, the Department may 
revoke an order, if it concludes that each exporter and producer 
covered at the time of revocation: (1) sold subject merchandise at not 
less than NV for a period of at least three consecutive years; and (2) 
is not likely in the future to sell the subject merchandise at less 
than NV. See 19 CFR 351.222(b)(2)(i) and (ii).
    Based on SSI's November 30, 2004, submission and the accompanying 
certification from the president of SSI, the Department preliminarily 
finds that SSI has satisfied the certification requirements of 19 CFR 
351.222(e)(1) and 19 CFR 351.222(b)(2)(iii). See Attachment to SSI's 
November 30, 2004, Request for Administrative Review, Request for 
Revocation of Antidumping Duty Order in Part, and Entry of Appearance.
    The Department also notes that SSI had zero or de minimis dumping 
margins in the first two PORs of this antidumping duty order and 
preliminarily finds that SSI has a zero or de minimis dumping margin 
for the current review. In the first administrative review (POR of May 
3, 2001, through October 31, 2002 (POR 1)), the Department calculated 
an antidumping duty rate of 0.00 percent. See Certain Hot-Rolled Carbon 
Steel Flat Products From Thailand: Final Results and Partial Rescission 
of Antidumping Duty Administrative Review, 69 FR 19388 (April 13, 
2004).
    The second administrative review (POR of November 1, 2002 through 
October 31, 2003 (POR 2)) was rescinded on April 7, 2004, and therefore 
no antidumping duty margin was calculated. See Certain Hot-Rolled 
Carbon Steel Flat Products from Thailand: Rescission of Antidumping 
Duty Administrative Review, 69 FR 18349 (April 7, 2004). The 
Department's Regulations provide that the Department need not conduct 
an administrative review of an intervening year before deciding to 
revoke an order as long as shipments, ``during each of the three (or 
five) years, there were exports to the United States in commercial 
quantities of the subject merchandise to which a revocation or 
termination will apply.'' See 19 CFR Sec.  351.222(d)(1). An 
intervening year is defined as ``any year between the first and final 
year of the consecutive period on which revocation or termination is 
conditioned.'' See 19 CFR Sec.  351.222(d)(2). In the present case, POR 
2 of the antidumping order on hot-rolled steel constitutes the 
intervening

[[Page 73202]]

year. Therefore, in accordance with 19 CFR Sec.  351.222(d)(2), the 
rescission of the review for POR 2 does not interrupt the three 
consecutive year period required by 19 CFR 351.222(b)(2)(i). Provided 
the Department does not find dumping in POR 3, SSI will have sold 
subject merchandise at not less than normal value for a period of at 
least three consecutive years and satisfied 19 CFR Sec.  351.222(b)(2). 
For POR 3, the Department has preliminarily concluded that SSI did not 
make sales below normal value. Therefore, the Department preliminarily 
concludes that SSI has satisfied the requirements of 19 CFR Sec.  
351.222(b)(2)(i) as it relates to the requirement of not selling at 
less than normal value for three consecutive years.
    Additionally, the Department has analyzed the volume of subject 
merchandise sold to the United States during the three consecutive 
periods of review, comparing these volumes with the volumes sold during 
the POI. The Department has preliminarily determined that SSI sold in 
commercial quantities. The Department has also preliminarily determined 
that SSI is not likely to sell subject merchandise at less than normal 
value in the future, thereby satisfying the requirements of 19 CFR 
Sec.  351.222(b)(2). See Department's Position Regarding Commercial 
Quantities and Department's Position Regarding Likelihood of Future 
Dumping below for a complete analysis.

Analysis

    Nucor concedes that if SSI has sold subject merchandise at not less 
than normal value for the current POR, it will partially satisfy the 
requirements of 19 C.F.C Sec.  351.222(b)(2). Nucor, however, argues 
that SSI has not met its burden of shipping in commercial quantities 
and that SSI will likely sell subject merchandise at less than normal 
value in the future. Therefore, Nucor maintains that SSI has failed to 
satisfy entirely the requirements of 19 CFR Sec.  351.222(b)(2) 
(relating to commercial quantities and the likelihood of future 
dumping).
    With regard to the commercial quantities requirement of 19 CFR 
Sec.  351.222(b)(2)(i) and 19 CFR Sec.  351.222(e)(ii), Nucor argues 
that a party requesting revocation must demonstrate that it 
``meaningfully participated in the marketplace.'' See Certain Cold-
Rolled and Corrosion Resistant Carbon Steel Flat Products From Korea, 
66 FR 3540 (January 16, 2001). Nucor maintains that in comparison to 
other foreign producers/exporters of hot-rolled coil and the hot-rolled 
coil market, SSI did not continue ``normal'' commercial activity after 
imposition of the antidumping order, did not export hot-rolled steel to 
the U.S. in commercial quantities, and did not meaningfully participate 
in the U.S. hot-rolled market during each of the consecutive 
administrative reviews subsequent to this antidumping order. See page 4 
of Nucor's July 21, 2005, submission. Rather than looking at contract 
date, invoice date or shipment date, as SSI provided in its April 19, 
2005 submission, Nucor argues that entry date is a more commercially 
accurate date to determine whether or not SSI shipped in commercial 
quantities. Nucor contends that entry date reflects the date that the 
subject merchandise physically entered the U.S. market, competes 
directly with U.S. producers, and becomes economically relevant. While 
SSI did not provide the entry date for its U.S. sales, Nucor maintains 
that the Department can use Bureau of Census (BC) data to analyze 
whether or not SSI shipped in commercial quantities. Nucor contends 
that SSI accounted for a majority of sales represented in BC data for 
the POI, and accounted for all shipments represented in BC data for the 
first, second, and third PORs, allowing the Department to review this 
public data and use it for an analysis.
    Nucor contends that SSI either made no shipments or ``sporadic'' 
shipments during POR 1. See page 8 of Nucor's July 21, 2005, 
submission. Nucor argues that there was a ``dramatic'' drop in imports 
of hot-rolled steel from Thailand when comparing the POI to POR 1 and 
POR 3. Id. Nucor contends that shipments of hot-rolled steel from 
Thailand were low when compared to imports from other countries subject 
to the antidumping duty order. Id.
    Nucor argues that SSI's share of U.S. domestic apparent consumption 
remained low during the three POR's of this antidumping order, and 67 
percent below the level maintained during the POI. See page 9 of 
Nucor's July 21, 2005, submission. Nucor further argues that SSI's 
share of hot-rolled imports into the U.S. market fell during the three 
PORs of this antidumping duty order compared to its level of U.S. 
market share during the POI. Id. Nucor maintains, therefore, that SSI 
has not demonstrated that it has made sales in commercial quantities 
during POR 1 and POR 3.
    SSI argues that it has exported subject merchandise to the United 
States in commercial quantities during the three consecutive 
administrative reviews of this antidumping duty order. SSI contends 
that regardless of how quantities are analyzed, using contract, invoice 
or shipment date, SSI has exported in commercial quantities that meet 
the requirements of 19 CFR Sec.  351.222(b)(2)(i) and 19 CFR Sec.  
351.222(e)(ii). See page 2 of SSI's July 21, 2005 submission.
    In its August 1, 2005 rebuttal comments, SSI argues that the 
Department is required to review sales by the company, not countrywide 
entry data from the BC. SSI contends that pursuant to 19 CFR. Sec.  
351.222(e), a producer/exporter must certify that it sold subject 
merchandise to the United States at not less than fair value during the 
POR and will not do so in the future. SSI maintains that the Department 
requires a review of sales, not entries of subject merchandise.
    Additionally, SSI maintains that BC countrywide entry data include 
entries from all Thai exporters and cannot be divided among specific 
producers/exporters. SSI contends, therefore, that using BC data is 
inaccurate. SSI also argues that Nucor's argument involving imports of 
hot-rolled steel from other countries, and those countries selling 
activities and market share is irrelevant as the Department must only 
analyze the exporter's or producer's specific behavior under the order.
    In determining whether three years of no dumping establish a 
sufficient basis to make a revocation determination, the Department 
must be able to determine that the company continued to participate 
meaningfully in the U.S. market during each of the three years at 
issue. See Certain Corrosion-Resistant Carbon Steel Flat Products from 
Canada; Final Results of Antidumping Administrative Review and 
Determination to Revoke in Part, 64 FR 2173, 2175 (Jan. 13, 1999) 
(Carbon Steel from Canada). This practice has been codified in section 
351.222(d)(1) of the Department's regulations, which states that, 
``before revoking an order or terminating a suspended investigation, 
the Secretary must be satisfied that, during each of the three (or 
five) years, there were exports to the United States in commercial 
quantities of the subject merchandise to which a revocation or 
termination will apply.'' 19 CFR 351.222(d)(1); see also 19 CFR 
351.222(e)(1)(ii). For purposes of revocation, the Department must be 
able to determine that past margins are reflective of a company's 
normal commercial activity. See Carbon Steel from Canada, 64 FR at 
2175. Sales during a POR that, in the aggregate, are of an abnormally 
small quantity, either in absolute terms or in comparison to an 
appropriate benchmark period, do not generally provide a reasonable 
basis for determining that the discipline of the

[[Page 73203]]

order is no longer necessary to offset dumping. Id.; see also Pure 
Magnesium From Canada, 64 FR 12977 (March 16, 1999). However, the 
determination as to whether or not sales volumes are made in commercial 
quantities is made on a case-by-case basis, based on the unique facts 
of each proceeding. See Dynamic Random Access Memory Semiconductors of 
One Megabyte or Above From the Republic of Korea: Final Results of 
Antidumping Duty Administrative Review and Determination Not To Revoke 
Order In Part, 62 FR 39809, 39812 (July 24, 1997) (DRAMS from Korea). 
Neither the statute nor the Department's regulations prescribes a 
specific standard for determining whether sales have been made in 
commercial quantities. See section 751(d) of the Act; 19 CFR 351.222.
    In many instances, the Department will use the original POI (i.e., 
pre-order shipment levels) as a benchmark for a company's normal 
commercial behavior, because the period of investigation generally 
provides a valid benchmark for assessing whether sales have been made 
in commercial quantities. See Carbon Steel from Canada, 64 FR at 2175. 
In the present case, the Department has followed this practice and used 
POI levels as a benchmark for determining whether SSI made sales to the 
United States in commercial quantities during each of the three periods 
of review covered by this antidumping order. SSI's sales volumes were 
verified during POR 1 and POR 3, and placed on the record, along with 
POI and POR 2 sales volumes, in SSI's April 19, 2005, submission. 
Additionally, the Department is using pricing data from Purchasing 
Magazine to supplement its analysis, which was placed on the record in 
a memorandum to the file dated November 30, 2005.\2\
---------------------------------------------------------------------------

    \2\ With regard to SSI's objection to Nucor's July 21, 2005 
submission, pursuant to 19 CFR 351.301(c)(2)(i) ``the Secretary may 
request any person to submit factual information at any time during 
a proceeding.'' On July 1, 2005, the Department requested that 
parties submit comments, regarding SSI's revocation request, by July 
21, 2005. Nucor responded to this request from the Department by 
filing comments by the Department's deadline. Therefore, the 
Department considers petitioners July 21, 2005 submission to be 
responsive to a request from the Department and, therefore, accepts 
it for purposes analyzing SSI's revocation request.
---------------------------------------------------------------------------

    The Department found that the volume of merchandise, based on 
either shipment date or sale invoice date, sold to the United States 
during POR 1 was about one-half of the volume sold during the POI. The 
volume sold increased during POR 2 to about 65 percent of the volume 
sold during the POI. Finally, during POR 3, the volume sold increased 
further to about 80 percent of the volume sold during the POI. While 
the volume of sales dropped from the POI to the three PORs, we find 
that the volume of sales shipped in the three PORs is a relatively high 
percentage of the POI volume of sales. SSI's sales volumes during any 
one of the three PORs never dropped to below 41 percent of POI volume 
when using shipment date or invoice date to compare volumes. Moreover, 
based on shipment date, the volume of hot-rolled steel SSI sold to the 
United States between POR 1, POR 2 and POR 3 increased steadily.
    We disagree with Nucor's argument that SSI either made no shipments 
or ``sporadic'' shipments during POR 1. The Department considers the 
entire period of review, not just a segment of the period, when 
reviewing sales in an administrative review. Fluctuations in sales may 
occur during a review period, which is why the Department considers the 
entire period of review to conduct its analysis and not just certain 
months of a period. In our view, a determination of whether a company 
participates meaningfully in the market is more accurately made by 
examining the company's volume throughout a POR, rather than by 
segmenting the data and its benchmarks into monthly periods.
    The Department, therefore, preliminary concludes that SSI has 
shipped in commercial quantities during three consecutive years and has 
satisfied the requirements of 19 CFR Sec.  351.222(b)(2)(i) and 19 CFR 
Sec.  351.222(e)(ii).
    In its July 21, 2005 submission, Nucor argues that the market for 
steel products is cyclical and that dumping will likely occur if this 
antidumping duty order with respect to SSI is revoked. See page 11 of 
Nucor's July 21, 2005, submission. Reviewing the period of October 1999 
through January 2001, Nucor contends that average apparent consumption 
of hot-rolled steel in the United States declined 13.8 percent while 
imports from Thailand increased 417 percent. See page 12 of Nucor's 
July 21, 2005, submission. Nucor argues, therefore, that SSI's sales of 
dumped products increased significantly during the U.S. market downturn 
and suggests that Thai producers of hot-rolled steel are likely to 
increase sales and reduce prices in order to maintain sales in a weak 
market environment. See page 12 of Nucor's July 21, 2005, submission.
    Nucor further contends that the administrative review periods are 
characterized by falling prices and hence, dumping of hot-rolled steel. 
Citing Purchasing Magazine and American Metal Market, Nucor maintains 
that prices for hot-rolled products, after being relatively high 
between 2001 and 2004, peaked in August 2004 and have begun to fall and 
will continue to fall into 2006. See page 13 of Nucor's July 21, 2005, 
submission. Nucor also argues that U.S. consumption and output are 
falling; Nucor claims that between March and May 2005, U.S. consumption 
and shipments fell, portending low prices for hot-rolled sheet. See 
pages 14-15 of Nucor's July 21, 2005, submission. Additionally, Nucor 
maintains that U.S. inventories remain high, with steel service centers 
holding inventories of 15.5 million tons as of May 2005. At the same 
time, Nucor claims that SSI is expanding its steel capacity. Therefore, 
Nucor claims that high inventory and production expansion will lead to 
future dumping. See pages 15-16 of Nucor's July 21, 2005, submission.
    Nucor argues that while Chinese demand fueled the rise in prices 
for hot-rolled steel over the last several years, the price of steel 
will decline because the demand for hot-rolled steel in China has 
``cooled.'' See page 17 of Nucor's July 21, 2005, submission. Moreover, 
Nucor contends that China has increased exports worldwide and reduced 
imports of hot-rolled steel, lowering prices in the Asian market, and 
leading to a reduction of demand for Thai hot-rolled steel in China. 
Additionally, Nucor contends that SSI will have to compete with China 
for export markets, a fact which has already led to an increase in 
exports of hot-rolled steel from Thailand to the United States in 2004. 
See page 18 of Nucor's July 21, 2005, submission. Nucor contends that 
China is expected to add an additional 48 million metric tons of 
capacity in 2005, further increasing competition among countries 
exporting hot-rolled steel to the United States.
    Nucor contends that SSI is expanding steel production capacity and 
incurring higher fixed costs (inventory) and slab costs. Coupled with 
current falling prices in the United States for hot-rolled steel, Nucor 
maintains that SSI must sell at dumped prices in order to remain 
competitive. See pages 20-21 of Nucor's July 21, 2005, submission. 
Based on this information, Nucor contends that SSI is likely to sell in 
the United States at less than normal value in the future and, 
therefore, the Department should not revoke this antidumping order with 
respect to SSI.
    SSI argues that the continued application of the antidumping duty 
order, as it regards SSI, is not otherwise necessary to offset dumping. 
SSI

[[Page 73204]]

contends that despite the continued commercial presence of SSI's 
exports of hot-rolled steel to the United States, market prices for 
hot-rolled steel have risen dramatically. See page 3 of SSI's July 21, 
2005, submission. SSI contends that while imports rose between POR 1 
and POR 3, U.S. market prices tripled, from an average of $215 to $714 
per net ton, demonstrating that SSI's increased presence in the U.S. 
market has had no impact on U.S. prices. SSI maintains that demand in 
Thailand has increased as well, increasing every year since the 
original POI, with consumption also growing during the same time 
period. See page 3 of SSI's July 21, 2005, submission.
    SSI argues that the U.S. hot-rolled steel industry had an operating 
profit of $7.5 billion, while increasing capacity, production, capacity 
utilization and shipments between 2003 and 2004. SSI argues that Nucor 
is expanding operations in the United States with regards to hot-rolled 
steel production, all while exports of hot-rolled steel to the United 
States increased without dumping.
    SSI argues that when sales during the course of three 
administrative reviews have not been made at less than normal value and 
there are sales in commercial quantities from the investigated 
producer, 19 CFR Sec.  351.222(b)(2) creates a presumption that the 
antidumping duty order is not necessary to offset dumping. SSI 
maintains that these facts are present in this case and, therefore, 
Nucor must present some compelling and substantial evidence regarding 
SSI's behavior under the antidumping duty order. SSI argues that Nucor 
has failed to do so in the present case and the Department should 
conclude that the continued application of the antidumping order is not 
otherwise necessary to offset dumping.
    SSI maintains that Nucor's argument concerning abnormally high 
prices in the U.S. market, and market conditions in China, are macro-
economic issues and are irrelevant to SSI's behavior under the current 
antidumping duty order. SSI further argues that Nucor has failed to 
provide any substantial evidence that China has had any impact 
specifically on SSI's behavior under the antidumping order. SSI 
concludes, therefore, that the presumption that the antidumping duty 
order is necessary to offset dumping has been overcome and the 
Department should revoke the antidumping order as it pertains to SSI.
    SSI argues that U.S. market prices for hot-rolled steel rose 
dramatically, despite the presence of SSI's commercially significant 
exports to the U.S. market. Additionally, SSI maintains that home 
market demand in Thailand has increased. SSI contends that based on 
these market conditions, there is no incentive for SSI to begin dumping 
should the antidumping duty order be revoked. SSI maintains that even 
though prices have fallen recently, this is a correction in the market 
that is natural after having such high hot-rolled prices over the past 
year and a half. SSI argues that it did not sell at less than normal 
value during times when the prices were relatively low. SSI further 
argues that the relatively high current prices do not mean it will dump 
in the future.
    With respect to 19 CFR 351.222(b)(1)(ii) and the likelihood of 
future dumping, the Department may consider such ``factors as 
conditions and trends in the domestic and home market industries, 
currency movements, and the ability of the foreign entity to compete in 
the U.S. marketplace without sales at less than normal value.'' See 
Steel Wire Rope From the Republic of Korea; Final Results of 
Antidumping Duty Administrative Review and Revocation in Part of 
Antidumping Duty Order, 63 FR 17986, 17988 (April 13, 1998) citing 
Brass Sheet and Strip from Germany, 61 FR 49727, 49730 (Sept. 23, 
1996); see also Proposed Regulation Concerning the Revocation of 
Antidumping Duty Orders, 64 FR 29818, 29820 (June 3, 1999) (explaining 
that when additional evidence as to whether the continued application 
of an antidumping duty order is necessary to offset dumping is placed 
on the record, ``the Department may consider trends in prices and 
costs, investment, currency movements, production capacity, as well as 
all other market and economic factors relevant to a particular 
case.''); and Brass Sheet and Strip from Canada: Preliminary Results of 
Antidumping Duty Administrative Review and Notice of Intent to Revoke 
Order in Part, 63 FR 6519, 6523 (February 9, 1998). Thus, based upon 
three consecutive reviews of zero or de minimis margins, the Department 
presumes that dumping is not likely to resume unless the Department has 
been presented with evidence to demonstrate that dumping is likely to 
resume if the order were revoked.
    We have reviewed the briefs presented by Nucor and respondent and 
preliminarily find no evidence to indicate the likelihood of future 
dumping. The Department analyzed SSI's sales volumes during the three 
PORs of the antidumping duty order and preliminarily determined that 
SSI has been able to sell in commercial quantities at not less than 
normal value regardless of how high or low U.S. prices are at the time 
(i.e., during a downward trend in the market). In DRAMS from Korea, a 
downward trend occurred in the market, with a resultant drop in U.S. 
prices. During this time, respondent sold subject merchandise at less 
than fair value in the United States in order to maintain its market 
share. Id. In the present review, this situation has not occurred. 
While prices have risen and fallen over the life of the antidumping 
order, SSI has continued to sell at not less than normal value and in 
commercial quantities. Upon a review of Purchasing Magazine data, 
during the POI hot-rolled steel ranged in price from $270 to $340 per 
net ton. During the life of the antidumping order, the price of hot-
rolled steel in the United States has been as low as $210 per net ton 
and as high as $756 per net ton, with SSI selling in large quantities 
when U.S. market prices were as low as $300 and as high as $714 per net 
ton. See exhibits 1 and 4 of Nucor's July 21, 2005, submission. Selling 
in the United States when market prices were at these levels 
demonstrates that SSI has participated meaningfully in the U.S. market 
and has sold in commercial quantities when the price for hot-rolled 
steel has been both high and low in the U.S. market.
    Nucor argues that between August 2004 and June 2005, U.S. prices 
for hot-rolled steel decreased. Nucor contends that dropping prices are 
a trend that is likely to continue and lead to dumping by SSI in order 
to retain market share. While prices have declined over the past year 
and a half, recent pricing data from Purchasing Magazine shows that 
prices have increased, by as much as $100 net ton between August and 
November 2005. See Attachment to the Department's November 30, 2005, 
Memorandum to the File regarding data used by the Department in its 
revocation analysis. Moreover, SSI has been able to export to the 
United States hot-rolled steel in large quantities at not less than 
fair value during the life of the antidumping duty order.
    Based on the above analysis, we preliminarily find that SSI has 
satisfied the commercial quantities requirement and the likelihood of 
future dumping requirement of 19 CFR. Sec.  351.222(b)(2). Therefore, 
the Department has preliminarily determined to revoke the antidumping 
duty order on hot-rolled steel with respect to SSI.

Currency Conversion

    We made currency conversions into U.S. dollars, in accordance with 
section 773A(a) of the Act, based on the exchange rates in effect on 
the dates of

[[Page 73205]]

the U.S. sales, as certified by the Federal Reserve Bank.

Preliminary Results of Review

    As a result of our review, we preliminarily determine the weighted-
average dumping margin for the period November 1, 2003, through October 
31, 2004, to be as follows:

------------------------------------------------------------------------
                Manufacturer / Exporter                 Margin (percent)
------------------------------------------------------------------------
Sahaviriya Steel Industries Public Company Limited....          0.01 (de
                                                                minimis)
------------------------------------------------------------------------

    The Department will disclose calculations performed in connection 
with these preliminary results of review within five days of the date 
of publication of this notice in accordance with 19 CFR 351.224(b). 
Interested parties may submit case briefs and/or written comments no 
later than 30 days after the date of publication of these preliminary 
results of review. Rebuttal briefs and rebuttals to written comments, 
limited to issues raised in the case briefs and comments, may be filed 
no later than 35 days after the date of publication of this notice. 
Parties who submit argument in these proceedings 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. An interested 
party may request a hearing within 30 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. The 
Department will issue the final results of these preliminary results, 
including the results of our analysis of the issues raised 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. Pursuant to section 351.212(b) of 
the Department's regulations, the Department calculates an assessment 
rate for each importer of the subject merchandise for each respondent. 
The Department will issue appropriate assessment instructions directly 
to CBP within 15 days of publication of the final results of review.

Cash Deposit Requirements

    If the final results remain unchanged from these preliminary 
results, no future cash deposits will be required for the subject 
merchandise with respect to SSI. For all other previously reviewed or 
investigated companies not part of this administrative review, or 
exporters not covered by this review who sell subject merchandise 
produced by a manufacturer who is subject to this or any other review 
or the less than fair value (LTFV) investigation, but not a part of 
this administrative review, pursuant to 751(a)(1) of the Act, the cash 
deposit rate will be the company-specific rate established for the most 
recent period. If neither the exporter nor the manufacturer is a firm 
covered in this review, any previous reviews, or the LTFV 
investigation, the cash deposit rate will be 3.86 percent, the ``all 
others'' rate established in the LTFV investigation. See Hot Rolled 
Steel Order. These deposit rates, when imposed, shall remain in effect 
until publication of the final results of the next administrative 
review.

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 antidumping duties.
    We are issuing and publishing this notice in accordance with 
sections 751(a)(1) and 777(i)(1) of the Act.

    Dated: November 30, 2005.
Stephen J. Claeys,
Acting Assistant Secretary for Import Administration.
[FR Doc. 05-23876 Filed 12-8-05; 8:45 am]
BILLING CODE 3510-DS-S