Honey from the People's Republic of China: Intent to Rescind and Preliminary Results of Antidumping Duty New Shipper Reviews, 32923-32929 [E6-8858]

Agencies

• DEPARTMENT OF COMMERCE
• International Trade Administration

[Federal Register Volume 71, Number 109 (Wednesday, June 7, 2006)]
[Notices]
[Pages 32923-32929]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E6-8858]


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

DEPARTMENT OF COMMERCE

International Trade Administration

[A-570-863]


Honey from the People's Republic of China: Intent to Rescind and 
Preliminary Results of Antidumping Duty New Shipper Reviews

AGENCY: Import Administration, International Trade Administration, 
Department of Commerce.

SUMMARY: The U.S. Department of Commerce (the Department) is conducting 
new shipper reviews of the antidumping duty order on honey from the 
People's Republic of China (PRC) in response to requests from Shanghai 
Taiside Trading Co., Ltd. (Taiside) and Wuhan Shino-Food Trade Co., 
Ltd. (Shino-Food). The period of review (POR) is December 1, 2004, 
through May 31, 2005. We have preliminarily determined that the new 
shipper review for Shino-Food should be rescinded because the sale made 
by Shino-Food was not bona fide, and we have preliminarily determined 
that the sale made by Taiside is bona fide and that the sale has been 
made below normal value. If these preliminary results are adopted in 
our final results of this review, we will instruct U.S. Customs and 
Border Protection (CBP) to assess antidumping duties on appropriate 
entries of subject merchandise during the POR. Interested parties are 
invited to comment on these preliminary results.

EFFECTIVE DATE: June 7, 2006.

FOR FURTHER INFORMATION CONTACT: Kristina Boughton or Bobby Wong, AD/
CVD Operations, Office 9, Import Administration, International Trade 
Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW, Washington, DC 20230; telephone: (202) 482-
8173 or (202) 482-0409, respectively.

SUPPLEMENTARY INFORMATION:

Background

    On June 20 and June 24, 2005, respectively, the Department received 
properly filed requests for a new shipper review, in accordance with 
section 751(a)(2)(B) of the Tariff Act of 1930, as amended (the Act) 
and 19 CFR 351.214(b) and (c), from Taiside and Shino-Food under the 
antidumping duty order on honey from the PRC. The Department determined 
that the requests met the requirements stipulated in 19 CFR 351.214, 
and on August 5, 2005, published its initiation of these new shipper 
reviews. Honey from the People's Republic of China: Initiation of New 
Shipper Antidumping Duty Review, 70 FR 45367 (August 5, 2005). On 
August 5, 2005, the Department issued antidumping duty new shipper 
questionnaires to Taiside and Shino-Food. Between September 2005 and 
February 2006, the Department received timely filed original and 
supplemental questionnaire responses from Taiside and Shino-Food.
    On October 14, 2005, we invited interested parties to comment on 
the Department's surrogate country selection and/or significant 
production in the potential surrogate countries and to submit publicly 
available information to value the factors of production. On January 
10, 2006, we extended the deadline on which to submit publicly 
available information to value the factors of production. On February 
17, 2006, the American Honey Producers Association and the Sioux Honey 
Association (collectively, petitioners) submitted comments on surrogate 
information with which to value the factors of production in this 
proceeding.
    On January 13, 2006, the Department extended the deadline for the 
preliminary results to March 31, 2006. Honey from the People's Republic 
of China: Extension of Time Limit for Preliminary Results of 2004/2005 
New Shipper Review, 71 FR 2182 (January 13, 2006). On March 9, 2006, 
the Department further extended the deadline for the preliminary 
results to May 22, 2006. Honey from the People's Republic of China: 
Extension of Time Limit for Preliminary Results of 2004/2005 New 
Shipper Review, 71 FR 12178 (March 9, 2006). On May 19, 2006, the 
Department fully extended the deadline for the preliminary results to 
May 30, 2006. See Honey from the People's Republic of China: Extension 
of Time Limit for Preliminary Results of 2004/2005 New Shipper Review, 
71 FR 29123 (May 19, 2006).
    From February 27 through March 1, 2006, the Department conducted 
verification of Taiside's questionnaire responses at the company's 
facilities in Shanghai, PRC. From March 17 through 19, 2006, the 
Department conducted verification of Shino-Food's questionnaire 
responses at the company's facilities in Wuhan, PRC.

Scope of the Antidumping Duty Order

    The products covered by this order are natural honey, artificial 
honey containing more than 50 percent natural honey by weight, 
preparations of natural honey containing more than 50 percent natural 
honey by weight, and flavored honey. The subject merchandise includes 
all grades and colors of honey whether in liquid, creamed, comb, cut 
comb, or chunk form, and whether packaged for retail or in bulk form.
    The merchandise subject to this order is currently classifiable 
under subheadings 0409.00.00, 1702.90.90, and 2106.90.99 of the 
Harmonized Tariff Schedule of the United States (HTSUS). Although the 
HTSUS subheadings are provided for convenience and customs purposes, 
the Department's written description of the merchandise under order is 
dispositive.

Verification

    As provided in section 782(i)(3) of the Act and 19 CFR 
351.307(b)(iv), we conducted verification of the

[[Page 32924]]

questionnaire responses of Taiside and Shino-Food in February and March 
2006, respectively. We used standard verification procedures, including 
on-site inspections of the production facilities and examination of 
relevant sales and financial records. Our verification results are 
outlined in the verification reports, public versions of which are on 
file in the Central Records Unit (CRU) located in room B-099 of the 
Main Commerce Building. See ``Memorandum to the File: Verification of 
the Sales and Factors Response of Shanghai Taiside Trading Co., Ltd. in 
the Antidumping Duty New Shipper Review on Honey from the People's 
Republic of China,'' dated May 30, 2006 (Taiside Verification Report); 
see also ``Memorandum to the File: Verification of the Sales and 
Factors Response of Wuhan Shino-Food Trade Co., Ltd. in the Antidumping 
Duty New Shipper Review on Honey from the People's Republic of China,'' 
dated May 30, 2006.

New Shipper Status

    Consistent with our practice, we investigated whether the sales 
made by Taiside and Shino-Food for these new shipper reviews were bona 
fide. See, e.g., Notice of Rescission of Antidumping Duty New Shipper 
Review: Honey from the People's Republic of China, 70 FR 59031 (October 
11, 2005). For Taiside, we found no evidence that the sale in question 
is not a bona fide sale. Based on our investigation into the bona fide 
nature of the sale, the questionnaire responses submitted by Taiside, 
and our verification thereof, we preliminarily determine that Taiside 
has met the requirements to qualify as a new shipper during the POR. 
See ``Memorandum to James C. Doyle, Office Director: Seventh 
Antidumping Duty New Shipper Review of the Antidumping Duty Order on 
Honey from the People's Republic of China: bona fide Analysis of 
Shanghai Taiside Trading Co., Ltd.,'' dated May 30, 2006. We have 
determined that Taiside made its first sale and/or shipment of subject 
merchandise to the United States during the POR, and that it was not 
affiliated with any exporter or producer that had previously shipped 
subject merchandise to the United States. Therefore, for purposes of 
these preliminary results of review, we are treating Taiside's sale of 
honey to the United States as an appropriate transaction for a new 
shipper review. See ``Separate Rates'' section below.
    However, for Shino-Food, we found evidence that the sale in 
question is not a bona fide sale. Based on our investigation into the 
bona fide nature of the sale, the questionnaire responses submitted by 
Shino-Food, and our verification thereof, we preliminarily determine 
that Shino-Food has not met the requirements to qualify for a new 
shipper review during the POR. See ``Memorandum to James C. Doyle, 
Office Director: bona fides Analysis and Intent to Rescind New Shipper 
Review of Honey from the People's Republic of China for Wuhan Shino-
Food Trade Co., Ltd.,'' dated May 30, 2006 (Shino-Food bona fides 
Analysis Memorandum), a public version of which is on file in the CRU. 
See ``Preliminary Intent to Rescind'' below.

Preliminary Intent to Rescind

    Concurrent with this notice, we are issuing a memorandum\1\ 
detailing our analysis of the bona fides of Shino-Food's U.S. sales and 
our preliminary decision to rescind the new shipper review with respect 
to Shino-Food based on the totality of the circumstances of its sale. 
Although much of the information relied upon by the Department to 
analyze the issues is business proprietary, the Department based its 
determination that the new shipper sale made by Shino-Food was not bona 
fide on the following: (1) the difference in the sales price of Shino-
Food's single POR sale as compared to the sales price of its subsequent 
sales; (2) the quantity of its single POR sale as compared to 
subsequent sales; (3) information regarding the payment of Shino-Food's 
freight and antidumping cash deposit for its single sale during the 
POR; and (4) other indicia of a non-bona fide transaction.
---------------------------------------------------------------------------

    \1\ See Shino-Food bona fides Analysis Memorandum.
---------------------------------------------------------------------------

    Because the Department has found Shino-Food's single POR sale to be 
non-bona fide, it is not subject to review. Therefore, the Department 
intends to rescind this review because Shino-Food has no reviewable 
sales during the POR. See Tianjin Tiancheng Pharmaceutical Co., Ltd. v. 
United States, 366 F. Supp. 2d 1246, 1249 (CIT 2005) 
(``{P{time} ursuant to the rulings of the Court, Commerce may exclude 
sales from the export price calculation where it finds that they are 
not bona fide'').

Separate Rates

    In proceedings involving non-market economy (NME) countries (see 
section 771(18) of the Act), the Department begins with a rebuttable 
presumption that all companies within the country are subject to 
government control and, thus, should be assigned a single antidumping 
duty rate unless an exporter can affirmatively demonstrate an absence 
of government control, both in law (de jure) and in fact (de facto), 
with respect to its export activities. For its new shipper review, 
Taiside submitted information in support of its claim for a company-
specific rate. Moreover, we examined Taiside's clam for a separate rate 
at verification.
    Accordingly, we have considered whether Taiside is independent from 
government control, and therefore eligible for a separate rate. The 
Department's separate-rate test to determine whether the exporters are 
independent from government control does not consider, in general, 
macroeconomic/border-type controls, e.g., export licenses, quotas, and 
minimum export prices, particularly if these controls are imposed to 
prevent dumping. The test focuses, rather, on controls over the 
investment, pricing, and output decision-making process at the 
individual firm level. See Certain Cut-to-Length Carbon Steel Plate 
from Ukraine: Final Determination of Sales at Less than Fair Value, 62 
FR 61754, 61756 (November 19, 1997), and Tapered Roller Bearings and 
Parts Thereof, Finished and Unfinished, from the People's Republic of 
China: Final Results of Antidumping Duty Administrative Review, 62 FR 
61276, 61278 (November 17, 1997).
    To establish whether a firm is sufficiently independent from 
government control of its export activities to be entitled to a 
separate rate, the Department analyzes each entity exporting the 
subject merchandise under a test arising from the Notice of Final 
Determination of Sales at Less Than Fair Value: Sparklers from the 
People's Republic of China, 56 FR 20588 (May 6, 1991), and accompanying 
Issue and Decision memorandum at Comment 1 (Sparklers), as affirmed by 
Notice of Final Determination of Sales at Less Than Fair Value: Silicon 
Carbide from the People's Republic of China, 59 FR 22585, 22586-7 (May 
2, 1994) (Silicon Carbide). In accordance with the separate-rates 
criteria, the Department assigns separate rates in NME cases only if 
respondents can demonstrate the absence of both de jure and de facto 
government control over export activities.
    Taiside provided complete separate-rate information in its 
responses to our original and supplemental questionnaires. Accordingly, 
we performed a separate-rates analysis to determine whether this 
producer/exporter is independent from government control.

[[Page 32925]]

Absence of De Jure Control
    The Department considers the following de jure criteria in 
determining whether an individual company may be granted a separate 
rate: (1) An absence of restrictive stipulations associated with an 
individual exporter's business and export licenses; (2) any legislative 
enactments decentralizing control of companies; and (3) other formal 
measures by the government decentralizing control of companies. See 
Sparklers, 56 FR 20588, and accompanying Issue and Decision memorandum 
at Comment 1. As discussed below, our analysis shows that the evidence 
on the record supports a preliminary finding of de jure absence of 
government control for Taiside based on each of these factors.

Taiside:

    Taiside has placed on the record a number of documents to 
demonstrate absence of de jure control, including the ``Company Law of 
the People's Republic of China'' (December 29, 1993) and the ``Foreign 
Trade Law of the People's Republic of China'' (May 12, 1994). See 
Exhibit A-2 of Taiside's September 2, 2005, submission (Taiside Section 
A). Taiside also submitted a copy of its business license in Exhibit A-
3 of Taiside Section A. The Shanghai Industry & Commerce Administration 
Bureau issued this license. Taiside explains that its business license 
defines the scope of the company's business activities and ensures the 
company has sufficient capital to continue its business operations. 
Taiside states that its license is issued solely and directly to 
Taiside and no other company can use the business license that Taiside 
uses. Taiside adds that its license defines the business activities 
that Taiside engages in and entitles it to produce and sell honey and 
honey products, among others. There are no other limitations or 
entitlements posed by the business license, according to Taiside. 
Further, Taiside states that a business entity must obtain a license 
before it legally operates.
    We note that Taiside states that it is governed by the Company Law, 
which it claims governs the establishment of limited liability 
companies and provides that such a company shall operate independently 
and be responsible for its own profits and losses. Taiside also placed 
on the record the Foreign Trade Law, stating that this law allows them 
full autonomy from the central authority in governing its business 
operations. We have reviewed Article 11 of Chapter II of the Foreign 
Trade Law, which states, ``foreign trade dealers shall enjoy full 
autonomy in their business operation and be responsible for their own 
profits and losses in accordance with the law.'' As in prior cases, we 
have analyzed such PRC laws and found that they establish an absence of 
de jure control. See, e.g., Pure Magnesium from the People's Republic 
of China: Final Results of Antidumping Duty New Shipper Review, 63 FR 
3085, 3086 (January 21, 1998) and Preliminary Results of Antidumping 
Duty New Shipper Review: Certain Preserved Mushrooms From the People's 
Republic of China, 66 FR 30695, 30696 (June 7, 2001), as affirmed in 
Final Results of New Shipper Review: Certain Preserved Mushrooms From 
the People's Republic of China, 66 FR 45006 (August 27, 2001). 
Therefore, we preliminarily determine that there is an absence of de 
jure control over the export activities of Taiside.

Absence of De Facto Control

    Typically, the Department considers four factors in evaluating 
whether a respondent is subject to de facto government control of its 
export functions: (1) Whether the export prices are set by, or subject 
to, the approval of a government authority; (2) whether the respondent 
has authority to negotiate and sign contracts, and other agreements; 
(3) whether the respondent has autonomy from the government in making 
decisions regarding the selection of its management; and (4) whether 
the respondent retains the proceeds of its export sales and makes 
independent decisions regarding disposition of profits or financing of 
losses. See Silicon Carbide, 59 FR at 22587.
    As stated in previous cases, there is some evidence that certain 
enactments of the PRC central government have not been implemented 
uniformly among different sectors and/or jurisdictions in the PRC. Id. 
at 22586-22587. Therefore, the Department has determined that an 
analysis of de facto control is critical in determining whether 
respondents are, in fact, subject to a degree of government control 
that would preclude the Department from assigning separate rates.
    Taiside has asserted the following: (1) It is a privately owned 
company; (2) there is no government participation in its setting of 
export prices; (3) its general manager has the authority to sign export 
contracts; (4) the shareholders appointed the general manager, who 
selected the other managers, and Taiside does not have to notify 
government authorities of its management selection; (5) there are no 
restrictions on the use of its export revenue; and (6) the shareholders 
decide how profits will be used. See Taiside's September 2, 2005, 
Section A questionnaire response. We have examined the documentation 
provided and note that it does not demonstrate that pricing is 
coordinated among exporters of PRC honey.
    Consequently, because evidence on the record indicates an absence 
of government control, both in law and in fact, over Taiside's export 
activities, we preliminarily determine that Taiside has met the 
criteria for the application of a separate rate.

Normal Value Comparisons

    To determine whether Taiside's sales of honey to the United States 
were made at prices below normal value (NV), we compared its United 
States price to NV, as described in the ``U.S. Price'' and ``Normal 
Value'' sections of this notice.

U.S. Price

Export Price

    For Taiside, we based U.S. price on export price (EP) in accordance 
with section 772(a) of the Act, because the first sale to an 
unaffiliated purchaser was made prior to importation, and constructed 
export price (CEP) was not otherwise warranted by the facts on the 
record. We calculated EP based on the packed price from the exporter to 
the first unaffiliated customer in the United States. For Taiside we 
deducted foreign inland freight and foreign brokerage and handling 
expenses from the starting price (gross unit price), in accordance with 
section 772(c) of the Act.
    Where foreign inland freight and foreign brokerage and handling 
expenses were provided by PRC service providers or paid for in 
renminbi, we valued these services using Indian surrogate values (see 
``Factors of Production'' section below for further discussion). For 
those expenses that were provided by a market-economy provider and paid 
for in market-economy currency, we used the reported expense, pursuant 
to 19 CFR 351.408(c)(1).

Normal Value

Non-Market-Economy Status

    In every case conducted by the Department involving the PRC, the 
PRC has been treated as a NME country. Pursuant to section 
771(18)(C)(i) of the Act, any determination that a foreign country is 
an NME country shall remain in effect until revoked by the 
administering authority. See Tapered Roller Bearings and Parts Thereof, 
Finished and Unfinished, from the People's Republic of China: 
Preliminary Results of 2001-2002 Administrative

[[Page 32926]]

Review and Partial Rescission of Review, 68 FR 7500 (February 14, 
2003), as affirmed in Tapered Roller Bearings and Parts Thereof, 
Finished and Unfinished, from the People's Republic of China: Final 
Results of 2001-2002 Administrative Review and Partial Rescission of 
Review, 68 FR 70488 (December 18, 2003). None of the parties to these 
reviews have contested such treatment. Accordingly, we calculated NV in 
accordance with section 773(c) of the Act, which applies to NME 
countries.

Surrogate Country

    Section 773(c)(4) of the Act requires the Department to value an 
NME producer's factors of production, to the extent possible, in one or 
more market-economy countries that: (1) are at a level of economic 
development comparable to that of the NME country, and (2) are 
significant producers of comparable merchandise. India is among the 
countries comparable to the PRC in terms of overall economic 
development, as identified in the ``Memorandum from the Office of 
Policy to Carrie Blozy,'' dated October 14, 2005.\2\ In addition, based 
on publicly available information placed on the record (e.g., world 
production data), India is a significant producer of honey. 
Accordingly, we considered India the surrogate country for purposes of 
valuing the factors of production because it meets the Department's 
criteria for surrogate-country selection. See ``Memorandum to the File: 
Selection of a Surrogate Country,'' dated May 30, 2006, (Surrogate 
Country Memo).
---------------------------------------------------------------------------

    \2\ This memorandum is attached to the letters sent to 
interested parties to this proceeding requesting comments on 
surrogate country and surrogate value information, dated October 14, 
2005.
---------------------------------------------------------------------------

Application of Adverse Facts Available

    The Department's August 5, 2005, questionnaire and its November 15, 
2005, and January 13, 2006, supplemental questionnaires requested that 
Taiside report all packing inputs. At verification, the Department 
found that Taiside had not reported in its responses that it used 
staples and paperboard inserts during the POR. See Taiside Verification 
Report. The company did not give the Department information on these 
inputs at verification.
    Section 776(a)(1) and (2) of the Act state that the Department may 
use facts otherwise available in the reaching the applicable 
determination if: 1) the necessary information is not available on the 
record; or, 2) an interested party or any other person (A) Withholds 
information that has been requested by the administering authority 
under this subtitle, (B) fails to provide such information by the 
deadlines for submission of the information or in the form and manner 
requested, (C) significantly impedes a proceeding under this subtitle, 
or (D) provides such information but the information cannot be 
verified.
    The Department finds that the application of facts otherwise 
available is warranted under sections 776(a)(2)(A) and (B) of the Act 
because Taiside withheld certain factors information for the POR from 
its responses and failed to provide the factors information by the 
deadlines for submission of the information.
    Pursuant to section 776(b) of the Act, the Department may use an 
inference that is adverse to the interests of that party in selecting 
from among the facts otherwise available when the party fails to 
cooperate by not acting to best of its ability. Certain Welded Carbon 
Steel Pipes and Tubes from Thailand: Final Results of Antidumping Duty 
Administrative Review, 62 FR 53808, 53809-53810 (October 16, 1997) and 
Notice of Final Determination of Sales at Less Than Fair Value and 
Final Negative Critical Circumstances: Carbon and Certain Alloy Steel 
Wire Rod from Brazil, 67 FR 55792, 55794-96 (August 30, 2002). 
Accordingly, adverse inferences are appropriate ``to ensure that the 
party does not obtain a more favorable result by failing to cooperate 
than if it had cooperated fully.'' Statement of Administrative Action 
Accompanying the Uruguay Round Agreements Act, H.R. Rep. No. 103-316, 
at 870, (1994). Furthermore, ``affirmative evidence of bad faith on the 
part of a Respondent is not required before the Department may make an 
adverse inference.'' Antidumping Duties; Countervailing Duties; Final 
Rule, 62 FR 27296, 27340 (May 19, 1997).
    The Department preliminarily finds that an adverse inference is 
warranted due to Taiside's failure to put forth its maximum efforts to 
fully and accurately report consumption of inputs related to the 
manufacturing of honey during the POR. The information with respect to 
these packing inputs was in the sole possession of Taiside. The 
Department asked questions on the reporting of Taiside's packing inputs 
in its November 15, 2005, and January 13, 2006, supplemental 
questionnaires. These two inputs are critical to the calculation of an 
accurate dumping margin because they relate directly to the normal 
value of the subject honey sold during the POR, as section 773(c)(1)(B) 
of the Act requires the Department to include ``the cost of containers, 
coverings, and other expenses.'' However, Taiside did not provide the 
information, even though Taiside had this information in its sole 
possession. Therefore, the Department finds that Taiside failed to act 
to the best of its ability in reporting its factors data. Consistent 
with the Department's practice in other cases where a respondent fails 
to cooperate to the best of its ability, and in keeping with section 
776(b) of the Act, the Department finds that the use of partial AFA is 
warranted for Taiside's two unreported packing inputs, discovered 
during verification. See Taiside Verification Report at 11.
    Therefore, for these preliminary results, as partial AFA and based 
on the approximate additional consumption of staples and paperboard, 
the Department will double the reported usage rates of carton and tape-
-those inputs on the record that mimic the functions of the unreported 
packing inputs of staples and paperboard inserts--to account for the 
additional unreported packing materials. See ``Factors of Production'' 
section below.

Factors of Production

    In accordance with section 773(c)(3) of the Act, we calculated NV 
based on the factors of production which included, but were not limited 
to: (A) Hours of labor required; (B) quantities of raw materials 
employed; (C) amounts of energy and other utilities consumed; and (D) 
representative capital costs, including depreciation. We used factors 
of production reported by the producer or exporter for materials, 
energy, labor, and packing, except as indicated. To calculate NV, we 
multiplied the reported unit factor quantities by publicly available 
Indian values.
    For Taiside, based on information obtained at verification, for 
these preliminary results the Department will apply partial adverse 
facts available to the calculation of the usage rates for two 
unreported packing inputs. See ``Application of Adverse Facts 
Available,'' section above.
    In selecting the surrogate values, we considered the quality, 
specificity, and contemporaneity of the data, in accordance with our 
practice. See, e.g., Fresh Garlic from the People's Republic of China: 
Final Results of Antidumping Duty New Shipper Review, 67 FR 72139 
(December 4, 2002), and accompanying Issues and Decision Memorandum at 
Comment 6; and Final Results of First New Shipper Review and First 
Antidumping Duty Administrative Review: Certain Preserved Mushrooms 
From the People's Republic of China, 66 FR 31204 (June 11, 2001), and

[[Page 32927]]

accompanying Issues and Decision Memorandum at Comment 5. When we used 
publicly available import data reported in the Monthly Statistics of 
the Foreign Trade of India (Indian Import Statistics), as published by 
the Directorate General of Commercial Intelligence and Statistics of 
the Ministry of Commerce and Industry, Government of India, and 
available from World Trade Atlas (see https://www.gtis.com/wta.htm) to 
value inputs sourced domestically by PRC suppliers, we added to the 
Indian surrogate values a surrogate freight cost calculated using the 
shorter of the reported distance from the domestic supplier to the 
factory or the distance from the nearest port of export to the factory. 
This adjustment is in accordance with the CAFC's decision in Sigma 
Corp. v. United States, 117 F. 3d 1401, 1408 (Fed. Cir. 1997). When we 
used non-import surrogate values for factors sourced domestically by 
PRC suppliers, we based freight for inputs on the actual distance from 
the input supplier to the site at which the input was used. In 
instances where we relied on Indian import data to value inputs, in 
accordance with the Department's practice, we excluded imports from 
both NME countries and countries deemed to maintain broadly available, 
non-industry-specific subsidies which may benefit all exporters to all 
export markets (i.e., Indonesia, South Korea, and Thailand) from our 
surrogate value calculations. See, e.g., Tapered Roller Bearings and 
Parts Thereof, Finished and Unfinished, from the People's Republic of 
China: Final Results of 1999-2000 Administrative Review, Partial 
Rescission of Review, and Determination Not to Revoke Order in Part, 66 
FR 57420 (November 15, 2001) and accompanying Issues and Decision 
Memorandum at Comment 1. See also, Notice of Preliminary Determination 
of Sales at Less Than Fair Value, Postponement of Final Determination, 
and Affirmative Preliminary Determination of Critical Circumstances: 
Certain Color Television Receivers From the People's Republic of China, 
68 FR 66800, 66808 (November 28, 2003), unchanged in the Department's 
final determination, Notice of Final Determination of Sales at Less 
Than Fair Value and Negative Final Determination of Critical 
Circumstances: Certain Color Television Receivers From the People's 
Republic of China, 69 FR 20594 (April 16, 2004). See ``Memorandum to 
the File: Factors of Production Valuation Memorandum for the 
Preliminary Results of New Shipper Administrative Reviews of Honey from 
the People's Republic of China,'' dated May 30, 2006 (Factor Valuation 
Memo), for a complete discussion of the import data that we excluded 
from our calculation of surrogate values. This memorandum is on file in 
the CRU.
    Where we could not obtain publicly available information 
contemporaneous with the POR to value factors, we adjusted the 
surrogate values using the Indian Wholesale Price Index (WPI) as 
published in the International Financial Statistics of the 
International Monetary Fund, for those surrogate values in Indian 
rupees. We made currency conversions, where necessary, pursuant to 19 
CFR 351.415, to U.S. dollars using the daily exchange rate 
corresponding to the reported date of each sale. We relied on the daily 
exchanges rates posted on the Import Administration Web site (https://
trade.gov/ia/ ). See Factor Valuation Memo.
    We valued the factors of production as follows:
    To value raw honey, we first calculated a weighted average of the 
raw honey prices for each month from December 2002 through June 2003, 
based on the percentage of each type of honey produced and sold, as 
derived from EDA Rural Systems Pvt Ltd.'s Web site, https://
www.litchihoney.com (EDA data), and as submitted by petitioners in 
their February 17, 2006, submission at exhibit 2. Next we inflated the 
EDA data to 2004 using the WPI. Then, to ensure that the EDA data 
reflects a POR contemporaneous price, the Department adjusted the WPI-
inflated EDA value for significant price decreases in the Indian honey 
market in 2005 as evidenced in the article titled ``Nosedive as supply 
exceeds demand'' (Nosedive article), which was published in the India 
Financial Express in January 2006.
    Because the above-referenced article did not specify monthly 
decreases in 2005, the Department took the average 2005 annual decrease 
and divided by twelve to approximate monthly decreases for all of 2005. 
Because there is no available information regarding the decline in 2005 
prices attributed to any one month, we preliminarily find that it is 
most reasonable to assume a steady, monthly price decline in 2005. This 
monthly price decline was then applied, successively, to each of the 
five months of the POR in 2005, using the 2004 inflated EDA data as the 
base value. No adjustment was made to the December 2004 value, which is 
based solely on the inflated EDA data. Finally, we calculated an 
average of monthly prices, resulting in the POR raw honey surrogate 
value.
    In selecting the raw honey values from the EDA data as the best 
available information with which to value raw honey in this proceeding, 
we note that the Department conducted extensive research on potential 
raw honey surrogate values for this new shipper review. The relevant 
research is included as Attachment 18 of the Factor Valuation Memo. In 
analyzing these data, the Department found substantial evidence that 
the raw honey values in India for the year 2005 declined significantly 
from previous years and that such decline was not reflected in the WPI 
adjustment. As outlined in the Factor Valuation Memo, though, the 
Department does not find the news articles to be as reliable or as 
veracious as the EDA data. The Department has determined that the 
comprehensiveness of the Nosedive article, which details three years of 
prices in three large honey-producing states in India, including prices 
for some of the same flower types represented in the EDA data, is a 
reliable source to adjust the EDA data to reflect raw honey prices in 
India and contemporaneous to the instant POR. For a detailed discussion 
of this issue, see Factor Valuation Memo.
    To value steam, the Department followed the methodology used in the 
investigation of certain tissue paper products and certain crepe paper 
products from the PRC. See Notice of Preliminary Determinations of 
Sales at Less Than Fair Value, Affirmative Preliminary Determination of 
Critical Circumstances and Postponement of Final Determination for 
Certain Tissue Paper Products, 69 FR 56407 (September 21, 2004), as 
affirmed in the final determination, Notice of Final Determination of 
Sales at Less Than Fair Value: Certain Tissue Paper Products from the 
People's Republic of China, 70 FR 7475 (February 14, 2005). Using 
publicly available sources, the Department calculated a value for steam 
by: 1) Finding an Indian natural gas price; 2) calculating the ratio of 
steam volume to natural gas volume; 3) applying this ratio to the 
surrogate value of Indian natural gas to obtain a value for steam in 
USD in thousands of cubic feet; 4) converting the USD in thousands of 
cubic feet value of steam into USD/kg using a publicly available 
conversion factor; and 5) adjusting the calculated value for inflation 
by applying the appropriate WPI inflator. See Factor Valuation Memo.
    To value water, we calculated the average price of all industrial 
water rates from various regions as reported by the Maharashtra 
Industrial Development Corporation, https://midcindia.org, dated June 1, 
2003. We inflated the value for

[[Page 32928]]

water using the POR-average WPI rate. See Factor Valuation Memo.
    We valued electricity using the 2000 electricity price in India 
reported by the International Energy Agency statistics for Energy 
Prices & Taxes, Second Quarter 2003. We inflated the value for 
electricity using the POR-average WPI rate. See Factor Valuation Memo.
    To value beeswax, plastic bottles, plastic caps, printed labels, 
cartons, plastic tape, man-made pallets, and plastic film, we used 
Indian Import Statistics, contemporaneous with the POR, removing data 
from certain countries as discussed in the Factor Valuation Memo. We 
also adjusted the surrogate values to include freight costs incurred 
between the shorter of the two reported distances from either: (1) the 
closest PRC seaport to the location producing the subject merchandise, 
or (2) the PRC domestic materials supplier to the location where the 
subject merchandise is produced. See Factor Valuation Memo.
    To value factory overhead, selling, general, and administrative 
expenses (SG&A), and profit, we relied upon publicly available 
information in the 2004-2005 annual report of Mahabaleshwar Honey 
Production Cooperative Society Ltd. (MHPC), a producer of the subject 
merchandise in India, upon which petitioners argued that the Department 
should rely. We are continuing to calculate SG&A based on the MHPC data 
as consistent with Honey from the People's Republic of China: Final 
Results and Final Rescission, In Part, of Antidumping Duty 
Administrative Review, 70 FR 38873, 38875 (July 6, 2005). In addition, 
we have reclassified employee benefit expenses as overhead expenses in 
the financial ratios calculation, consistent with the recent 
determination in Folding Metal Tables and Chairs from the People's 
Republic of China: Final Results of Antidumping Duty Administrative 
Review, 71 FR 2905 (January 18, 2006), and accompanying Issues and 
Decision memorandum at Comment 1B. See Factor Valuation Memo.
    Because of the variability of wage rates in countries with similar 
levels of per capita gross domestic product, 19 CFR 351.408(c)(3) 
requires the use of a regression-based wage rate. Therefore, to value 
the labor input, we used the PRC's regression-based wage rate published 
by Import Administration on its Web site, https://ia.ita.doc.gov/wages/. 
See Factor Valuation Memo.
    To value truck freight, we calculated a weighted-average freight 
cost based on publicly available data from https://www.infreight.com, an 
Indian inland freight logistics resource website. See Factor Valuation 
Memo.
    To value brokerage and handling, we used a simple average of the 
publicly summarized version of the average value for brokerage and 
handling expenses reported in the U.S. sales listings in Essar Steel 
Ltd.'s (Essar) February 28, 2005, Section C submission in the 
antidumping duty review of certain hot-rolled carbon steel flat 
products from India, and information from Agro Dutch Industries Ltd.'s 
(Agro Dutch) May 25, 2005, Section C submission, taken from the 
administrative review of preserved mushrooms from India, for which the 
POR was February 1, 2004, through January 31, 2005. See Fresh Garlic 
from the People's Republic of China: Final Results and Partial 
Rescission of Antidumping Duty Administrative Review and Final Results 
of New Shipper Reviews, 71 FR 26329 (May 4, 2006), and accompanying 
Issues and Decision memo at Comment 6; and Certain Preserved Mushrooms 
From India: Final Results of Antidumping Duty Administrative Review, 71 
FR 10646 (March 2, 2006).
    Since the reported rate in Agro Dutch is contemporaneous with the 
POR, no adjustments to the value were necessary. However, as the Essar 
rate covers the period December 1, 2003, through November 30, 2004, we 
adjusted this rate for inflation using the POR wholesale WPI for India. 
See Factor Valuation Memo.
    In accordance with 19 CFR 351.301(c)(3)(ii), for the final results 
of this new shipper review, interested parties may submit publicly 
available information to value the factors of production until 20 days 
following the date of publication of these preliminary results.

Preliminary Results of Review

    We preliminarily determine that the following antidumping duty 
margin exists:

------------------------------------------------------------------------
                                                                Margin
                          Exporter                             (percent)
------------------------------------------------------------------------
Shanghai Taiside Trading Co., Ltd...........................      39.69%
------------------------------------------------------------------------

    For details on the calculation of the antidumping duty weighted-
average margin for Taiside, see Taiside's analysis memorandum for the 
preliminary results of the seventh new shipper review of the 
antidumping duty order on honey from the PRC, dated May 30, 2006. A 
public version of this memorandum is on file in the CRU.

Assessment Rates

    Pursuant to 19 CFR 351.212(b), the Department will determine, and 
CBP shall assess, antidumping duties on all appropriate entries. The 
Department will issue appropriate assessment instructions directly to 
CBP within 15 days of publication of the final results of this review. 
For assessment purposes, where possible, we calculated an importer-
specific assessment rate for honey from the PRC on a per-unit basis. 
Specifically, we divided the total dumping margins (calculated as the 
difference between normal value and export price or constructed export 
price) for each importer by the total quantity of subject merchandise 
sold to that importer during the POR to calculate a per-unit assessment 
amount. If these preliminary results are adopted in our final results 
of review, we will direct CBP to levy importer-specific assessment 
rates based on the resulting per-unit (i.e., per-kilogram) rates by the 
weight in kilograms of each entry of the subject merchandise during the 
POR.

Cash Deposits

    The following cash-deposit requirement will be effective upon 
publication of the final results for shipments of the subject 
merchandise entered, or withdrawn from warehouse, for consumption on or 
after the publication date of the final results, as provided by section 
751(a)(2)(C) of the Act. For subject merchandise exported by Taiside, 
we will establish a per-kilogram cash deposit rate that will be 
equivalent to the company-specific cash deposit established in this 
review. These deposit requirements shall remain in effect until 
publication of the final results of the next administrative review.

Schedule for Final Results of Review

    Unless otherwise notified by the Department, interested parties may 
submit case briefs within 30 days of the date of publication of this 
notice in accordance with 19 CFR 351.309(c)(ii). As part of the case 
brief, parties are encouraged to provide a summary of the arguments not 
to exceed five pages and a table of statutes, regulations, and cases 
cited. Rebuttal briefs, which must be limited to issues raised in the 
case briefs, must be filed within five days after the case brief is 
filed. See 19 CFR 351.309(d).
    Any interested party may request a hearing within 30 days of 
publication of this notice in accordance with 19 CFR 351.310(c). Any 
hearing would normally be held 37 days after the publication of this 
notice, or the first workday

[[Page 32929]]

thereafter, at the U.S. Department of Commerce, 14th Street and 
Constitution Avenue NW, Washington, DC 20230. Individuals who wish to 
request a hearing must submit a written request within 30 days of the 
publication of this notice in the Federal Register to the Assistant 
Secretary for Import Administration, U.S. Department of Commerce, Room 
1870, 14th Street and Constitution Avenue, NW, Washington, DC 20230. 
Requests for a public hearing should contain: (1) The party's name, 
address, and telephone number; (2) the number of participants; and, (3) 
to the extent practicable, an identification of the arguments to be 
raised at the hearing. If a hearing is held, an interested party must 
limit its presentation only to arguments raised in its briefs. Parties 
should confirm by telephone the time, date, and place of the hearing 48 
hours before the scheduled time.
    The Department will issue the final results or final rescissions of 
these new shipper reviews, which will include the results of its 
analysis of issues raised in the briefs, within 90 days from the date 
of the preliminary results, unless the time limit is extended.

Notification

    At the completion of the new shipper review of Shino-Food, either 
with a final rescission or a notice of final results, the Department 
will notify the CBP that bonding is no longer permitted to fulfill 
security requirements for shipments by the exporter/producer 
combination of Shino-Food for honey from the PRC entered, or withdrawn 
from warehouse, for consumption on or after the publication of the 
final rescission or results notice in the Federal Register. If a final 
rescission notice is published, a cash deposit of 183.80 percent ad 
valorem shall be collected for any entries exported/produced by Shino-
Food. Should the Department reach a final result other than a 
rescission, an appropriate antidumping duty rate will be calculated for 
both assessment and cash deposit purposes.
    This new shipper review and this notice are published in accordance 
with sections 751(a)(2)(B) and 777(i)(1) of the Act.

    Dated: May 30, 2006.
David M. Spooner,
Assistant Secretary for Import Administration.
[FR Doc. E6-8858 Filed 6-6-06; 8:45 am]
BILLING CODE 3510-DS-S