Lemon Juice from Argentina: Preliminary Determination of Sales at Less Than Fair Value and Affirmative Preliminary Determination of Critical Circumstances, 20820-20830 [E7-8015]

Agencies

• DEPARTMENT OF COMMERCE
• International Trade Administration

[Federal Register Volume 72, Number 80 (Thursday, April 26, 2007)]
[Notices]
[Pages 20820-20830]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-8015]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-357-818]


Lemon Juice from Argentina: Preliminary Determination of Sales at 
Less Than Fair Value and Affirmative Preliminary Determination of 
Critical Circumstances

AGENCY: Import Administration, International Trade Administration, 
Department of Commerce.
SUMMARY: In response to a petition filed by Sunkist Growers, Inc. 
(Petitioner), the U.S. Department of Commerce (the Department) is 
conducting an antidumping duty investigation of sales to the United 
States of lemon juice from Argentina for the period July 1, 2005 
through June 30, 2006. See Notice of Initiation of Antidumping Duty 
Investigations: Lemon Juice from Argentina and Mexico, 71 FR 61710 
(October 19, 2006) (Initiation Notice). The Department preliminarily 
determines that lemon juice from Argentina is being, or is likely to 
be, sold in the United States at less than fair value (LTFV), as 
provided in section 733(b) of the Tariff Act of 1930, as amended (the 
Act). The estimated margins of sales at LTFV are listed in the 
``Suspension of Liquidation'' section of this notice. Moreover, we 
preliminarily determine that critical circumstances exist with regard 
to imports of lemon juice from Argentina. See the ``Critical 
Circumstances'' section below. Interested parties are invited to 
comment on this preliminary determination.

EFFECTIVE DATE:  April 26, 2007.

FOR FURTHER INFORMATION CONTACT: Mark Hoadley or Joshua Reitze, AD/CVD 
Operations, Office 6, Import Administration, International Trade 
Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW, Washington, DC 20230; telephone: (202) 482-
3148, or (202) 482-0666, respectively.

SUPPLEMENTARY INFORMATION:

Case History

    This investigation was initiated on October 19, 2006. See 
Initiation Notice. Since the initiation of the investigation, the 
following events have occurred. On November 6, 2006, the United States 
International Trade Commission (ITC) preliminarily determined that 
there is a reasonable indication that imports of the products subject 
to this investigation are materially injuring an industry in the United 
States producing the domestic like product. See Lemon Juice from 
Argentina and Mexico, 71 FR 66795 (November 16, 2006) (ITC Preliminary 
Determination).
    On November 7, 2006, the Department selected Citrusvil, S.A. 
(Citrusvil) and S.A. San Miguel A.G.I.C.y F. (San Miguel) as the 
respondents in this investigation. See ``Respondent Selection'' section 
below. On November 7, 2006, the Department issued a letter providing 
interested parties an opportunity to comment on a proposed set of 
model-match criteria. We received comments in response to this letter 
from Petitioner, Citrusvil, and San Miguel on November 13, 2006. Based 
on our analysis of these submissions, we determined the appropriate 
model-match characteristics. See Memorandum to Barbara E. Tillman, 
Director, Office 6, and Laurie Parkhill, Director, Office 5, 
``Antidumping Duty Investigations of Lemon Juice from Argentina and 
Mexico: Selection of Model Matching Criteria'' (November 20, 2006).
    The Department issued sections A - D of the questionnaire to 
Citrusvil and San Miguel on November 20, 2006.\1\ Citrusvil submitted 
its response to section A on December 18, 2007. Citrusvil submitted its 
response to sections B and C on January 17, 2007, and its section D 
response on January 22, 2007. San Miguel submitted its response to 
section A on December 14, 2006, responses to sections B and C on 
January 16, 2007, and its response to section D on March 12, 2007.
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    \1\ Section A of the questionnaire requests general information 
concerning a company's corporate structure and business practices, 
the merchandise under investigation that it sells, and the manner in 
which it sells that merchandise in all of its markets. Section B 
requests a complete listing of all home market sales, or, if the 
home market is not viable, of sales in the most appropriate third-
country market (this section is not applicable to respondents in 
non-market economy (NME) cases). Section C requests a complete 
listing of U.S. sales. Section D requests information on the cost of 
production (COP) of the foreign like product and the constructed 
value (CV) of the merchandise under investigation.
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    On January 5, 2007, Petitioner submitted comments on Citrusvil's 
section A response. The Department issued a supplemental section A 
questionnaire to Citrusvil on January 16, 2007. We received Citrusvil's 
supplemental section A response on January 26, 2007. On January 31, 
2007, Petitioner submitted a German-specific, sales-below-cost 
allegation. Citrusvil did not rebut this allegation. On February 1, 
2007, we issued a supplemental section D questionnaire to Citrusvil, to 
which Citrusvil responded on February 23, 2007. On February 9, 2007, 
and again on March 6, 2007, Petitioner submitted comments on 
Citrusvil's section D response. On January 30, 2007, Petitioner 
submitted comments on Citrusvil's section B and C response. The 
Department issued a supplemental section B and C questionnaire to 
Citrusvil on February 5, 2007. We received Citrusvil's supplemental 
section B and C response on March 9, 2007. Citrusvil submitted 
corrections to its section B and C response on April 4, 2007. On 
February 9, 2007, Petitioner submitted comments concerning possible 
affiliation issues between Citrusvil and its German sales agent. On 
February 16, 2007, the Department sent a general supplemental 
questionnaire to Citrusvil, to which Citrusvil responded on March 12, 
2007. On March 15, we sent Citrusvil a second supplemental section D 
questionnaire, to which Citrusvil responded on April 5, 2007. On March 
23, 2007, we sent Citrusvil a request for additional sales information, 
to which Citrusvil partially responded on April 9, 2007.
    Petitioner submitted its comments on San Miguel's section A 
response on January 29, 2007. On January 12, 2007, the Department 
issued a supplemental section A questionnaire to San Miguel. Petitioner 
filed a sales-below-cost allegation on January 24, 2007 with respect to 
San Miguel's sales in Argentina. On February 23, 2007, Petitioner 
submitted comments to San Miguel's section B and C response. The 
Department issued a supplemental section A to San Miguel on January 16, 
2007, supplemental sections B and C on January 31, 2007, and a 
supplemental section D on March 16, 2007. San Miguel responded to the 
supplemental section A on January 23, 2007, supplemental sections B and 
C on

[[Page 20821]]

March 1, 2007, and supplemental section D on April 5, 2007.
    On February 1, 2007, Petitioner requested that the Department 
extend the preliminary determination in this investigation from 
February 28, 2007 to April 19, 2007. On February 16, 2007, the 
Department postponed the preliminary determination to April 19, 2007 
pursuant to section 733(c) of the Act. See Postponement of Preliminary 
Determinations of Antidumping Duty Investigations: Lemon Juice from 
Argentina and Mexico, 72 FR 7606 (February 16, 2007).
    On March 26, 2007, April 9, 2007, and April 10, 2007, Petitioner 
submitted comments in anticipation of the preliminary determination. On 
March 16, 2007, the Department granted Petitioner an extension of time 
until March 27, 2007 to file its allegation of targeted dumping. On 
March 27, 2007, Petitioner submitted a targeted dumping allegation for 
San Miguel. On April 13, 2007, San Miguel submitted comments in 
response to Petitioner's allegation. Although this allegation was 
timely, the Department did not have sufficient time to fully analyze it 
for purposes of this preliminary determination pursuant to section 
777A(d)(1)(B) of the Act. We intend to fully consider this issue for 
purposes of our final determination.
    Finally, on March 30, 2007, Petitioner alleged that critical 
circumstances existed with regard to imports of lemon juice from 
Argentina and Mexico. On April 4, 2007, the Department issued letters 
to Citrusvil and San Miguel, requesting that the respondents provide 
shipment data for purposes of the Department's critical circumstances 
inquiry. On April 11, 2007, Citrusvil and San Miguel submitted the 
requested shipment data. For further information on the Department's 
preliminary critical circumstances determination, see ``Critical 
Circumstances'' section below.

Respondent Selection

    Section 777A(c)(1) of the Act directs the Department to calculate 
individual dumping margins for each known exporter and producer of the 
subject merchandise. Section 777A(c)(2) of the Act gives the Department 
discretion, when faced with a large number of producers/exporters, to 
limit its examination to a reasonable number of such companies if it is 
not practicable to examine all companies. Where it is not practicable 
to examine all known producers/exporters of subject merchandise, this 
provision permits the Department to investigate either (A) a sample of 
exporters, producers, or types of products that is statistically valid 
based on the information available to the Department at the time of 
selection or (B) producers/exporters accounting for the largest volume 
of the merchandise under investigation that can reasonably be examined. 
In the petition, Petitioner identified nine potential producers and 
exporters of lemon juice in Argentina: Citrusvil, San Miguel, Vicente 
Trapani S.A., Citromax S.A.C.I (Citromax), Litoral Citrus S.A., COTA 
S.A., La Moraleja S.A., Jugos Minerva (Molinos Rio de la Plata), and 
Jugos Minerva (S.C. Johnson & Son de Argentina S.A.I.C.). The 
Department determined that it was unable to investigate all nine of 
these named producers/exporters. See Memorandum to Barbara E. Tillman, 
Director, Office 6, ``Antidumping Duty Investigation on Lemon Juice 
from Argentina - Respondent Selection'', (November 7, 2006) (Respondent 
Selection Memorandum).
    Based on our analysis of import data obtained from U.S. Customs and 
Border Protection (CBP), we selected two producers/exporters, Citrusvil 
and San Miguel as the mandatory respondents in this investigation 
because they were the largest Argentine producers/exporters of lemon 
juice to the United States, accounting for the vast majority of imports 
into the United States. For a complete analysis of the respondent 
selection, see Respondent Selection Memorandum. Therefore, pursuant to 
section 777A(c)(2)(B) of the Act, the Department has calculated 
individual dumping margins for each of the two selected producers/
exporters.

Period of Investigation

    The period of investigation (POI) is July 1, 2005 through June 30, 
2006. This period corresponds to the four most recent fiscal quarters 
prior to the month of filing of the petition (i.e., September 2006) 
involving imports from a market economy, and is in accordance with the 
Department's regulations. See 19 CFR 351.204(b)(1).

Scope of Investigation

    The merchandise covered by this investigation includes certain 
lemon juice for further manufacture, with or without addition of 
preservatives, sugar, or other sweeteners, regardless of the GPL (grams 
per liter of citric acid) level of concentration, brix level, brix/acid 
ratio, pulp content, clarity, grade, horticulture method (e.g., organic 
or not), processed form (e.g., frozen or not-from-concentrate), FDA 
standard of identity, the size of the container in which packed, or the 
method of packing.
    Excluded from the scope are: (1) lemon juice at any level of 
concentration packed in retail-sized containers ready for sale to 
consumers, typically at a level of concentration of 48 GPL; and (2) 
beverage products such as lemonade that typically contain 20[percnt] or 
less lemon juice as an ingredient.
    Lemon juice is classifiable under subheadings 2009.39.6020, 
2009.31.6020, 2009.31.4000, 2009.31.6040, and 2009.39.6040 of the 
Harmonized Tariff Schedule of the United States (HTSUS). While HTSUS 
subheadings are provided for convenience and U.S. Customs and Border 
Patrol purposes, our written description of the scope of this 
investigation is dispositive.

Scope Issue

    In the Initiation Notice, the Department set aside a period for 
parties to submit comments on the scope of the investigations on 
Argentina and Mexico. On November 1, 2006, Citromax submitted comments 
stating that organic lemon juice should be excluded from the scope of 
the investigations. On November 8, 2006, Petitioner responded to 
Citromax's November 1, 2006, scope comments, arguing that organic lemon 
juice should remain within the scope of the investigations. On March 
21, 2007, the Department issued a decision that organic lemon juice is 
included within the scope of the investigations on lemon juice from 
Argentina and Mexico. For a detailed discussion of our decision, see 
Memorandum to Stephen J. Claeys, Deputy Assistant Secretary for Import 
Administration, ``Scope Issue in the Antidumping Duty Investigations on 
Lemon Juice from Argentina and Mexico'' (March 21, 2007).

Date of Sale

    It is the Department's practice to use invoice date as the date of 
sale. However, the Secretary ``may use a date other than the date of 
invoice if the Secretary is satisfied that a different date better 
reflects the date on which the exporter or producer establishes the 
material terms of sale.'' See 19 CFR 351.401(i); see also Allied Tube 
and Conduit Corp. v. United States, 132 F. Supp. 2d 1087, 1090-92 (CIT 
2001).
    Citrusvil reported date of purchase order as the date of sale for 
all sales in the U.S. market that involved purchase orders; otherwise, 
it reported invoice date. See Citrusvil January 17, 2007, section B and 
C response at C-7. Citrusvil reported contract date for all sales to 
Germany\2\ that involved short- or long-term contract agreements; for

[[Page 20822]]

the remaining sales, Citrusvil reported purchase order date as date of 
sale. See Citrusvil January 17, 2007 section B and C response at B-7. 
Citrusvil reported that these dates were the earliest dates on which 
the material terms of sale (i.e., price and quantity) were fixed, and 
that these terms never change after these dates. Because the material 
terms of sale are established when the purchase order is issued or 
contracts are signed, and because Citrusvil has stated that the terms 
of sale never changed after they were established, we are using the 
dates of sale as reported by Citrusvil.
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    \2\ We have preliminarily determined that Germany is Citrusvil's 
comparison market. See ``Selection of Comparison Market'' section 
below.
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    San Miguel reported invoice date as date of sale for all sales in 
both markets, stating that the material terms of sale indicated in 
other documents sometimes change before invoices are issued. It 
provided two examples of such changes. First, it referred to a purchase 
order issued by a U.S. customer requiring multiple shipments. This 
customer later requested that San Miguel cancel some of the shipments 
ordered. While San Miguel agreed and these shipments were therefore 
never shipped nor invoiced, the fact that the buyer felt compelled to 
ask San Miguel to cancel indicates that the parties considered the 
purchase order binding. In the second example, San Miguel reached an 
agreement via email regarding the per-unit price of shipments to a U.S. 
customer, but the price stated in the purchase order, issued subsequent 
to the exchange of emails, is different from that indicated in the 
email agreement. However, this change occurred between the date of an 
email agreement and the resulting purchase order, not between the 
purchase order and invoice. See San Miguel March 1, 2007 supplemental 
section B and C response, at 2-4. Accordingly, we preliminarily find 
that the two examples of changes in material terms of sale prior to 
invoice provided by San Miguel are not sufficient to show actual 
changes in material terms between purchase order date and invoice date, 
nor do they support a conclusion that the parties at issue consider 
purchase orders to be non-binding.
    Moreover, San Miguel's description of its production and 
distribution process indicates that the use of invoice date as date of 
sale for all sales may be distortive, given the significant lag time 
between purchase order date and invoice date. The record indicates that 
invoices can be issued up to several months after purchase orders are 
received. As such, the material terms of sale are set much earlier in 
the process than invoice date would indicate.
    Thus, for all sales involving purchase orders to the United States 
and comparison markets, the Department preliminarily determines that 
purchase order is the appropriate date of sale, as the evidence on the 
record demonstrates that the material terms of sale set forth in the 
purchase orders are not subject to change. For sales in which a 
purchase order is not generated, we will use the earliest of shipment 
or invoice date. Because purchase order date is not yet on the record 
for all sales reported by San Miguel, we are using the earliest of 
shipment or invoice date as date of sale for purposes of this 
preliminary determination. The Department has requested that San Miguel 
provide, prior to verification, revised U.S. and comparison market 
sales databases using purchase order date as date of sale.

Fair Value Comparisons

    To determine whether sales of lemon juice to the United States were 
made at LTFV, we compared export price (EP) or constructed export price 
(CEP) to normal value (NV) or constructed value (CV), as described in 
the ``U.S. Price,'' ``Normal Value,'' and ``Constructed Value'' 
sections below.

U.S. Price

    Section 772(a) and (b) of the Act defines EP and CEP:
    The term ``export price'' means the price at which the subject 
merchandise is first sold (or agreed to be sold) before the date of 
importation by the producer or exporter of the subject merchandise 
outside of the United States to an unaffiliated purchaser in the United 
States or to an unaffiliated purchaser for exportation to the United 
States, as adjusted under subsection (c).
    The term ``constructed export price'' means the price at which the 
subject merchandise is first sold (or agreed to be sold) in the United 
States before or after the date of importation by or for the account of 
the producer or exporter of such merchandise or by a seller affiliated 
with the producer or exporter, to a purchaser not affiliated with the 
producer or exporter, as adjusted under subsections (c) and (d).
    For purposes of this investigation, Citrusvil classified all of its 
U.S. sales as CEP sales. Citrusvil stated that, although it is not 
affiliated with any companies in the United States, its sales occurred 
after importation into the United States and are thus CEP sales. The 
record evidence indicates, however, that, based on purchase order date, 
Citrusvil's sales to the United States were made prior to importation. 
Accordingly, we preliminarily determine that all of Citrusvil's U.S. 
transactions were EP sales.
    We calculated the EP for Citrusvil in accordance with section 
772(c)(2) of the Act. We made appropriate deductions from gross unit 
price for Argentine inland freight and warehousing, Argentine brokerage 
and handling, international freight and insurance, U.S. brokerage and 
handling, U.S. freight and warehousing, U.S. duties, a fee paid to the 
regional government of Tucuman, and an export tax paid to the Argentine 
government. See Analysis Memorandum for Lemon Juice from Argentina: 
Citrusvil, April 19, 2007 (Citrusvil Analysis Memorandum).
    San Miguel reported that most of its U.S. sales took place prior to 
importation. It noted, however, that a small number of those sales were 
made after importation. According to San Miguel, these sales were made 
to the U.S. customer out of inventory held in a refrigerated warehouse 
located in the United States. Thus, because these sales were made after 
importation, they cannot be classified as EP sales and we are treating 
them as CEP sales.
    We calculated the EP for San Miguel in accordance with section 
772(c)(2) of the Act. We made appropriate deductions for billing 
adjustments (or added billing adjustments in some cases), Argentine 
inland freight and warehousing, Argentine brokerage and handling, 
international freight and insurance, U.S. brokerage and handling, U.S. 
freight and warehousing, U.S. duties, a fee paid to the regional 
government of Tucuman, and an export tax paid to the Argentine 
government. San Miguel claimed another U.S. price adjustment: a per-
sale reimbursement received from the Argentine government under its 
Reintegro program. In past proceedings involving merchandise from 
Argentina, we have accounted for these reimbursements by making an 
adjustment to cost of manufacturing (COM), and will do so here as well. 
See, e.g., Notice of Final Results and Recision in Part of Antidumping 
Duty Administrative Review; Oil Country Tubular Goods, Other Than Drill 
Pipe, From Argentina, 68 FR 13262, 13263 (March 19, 2003), and 
accompanying Issues and Decision Memorandum at Comment 5; Notice of 
Final Determination of Sales at Less Than Fair Value and Negative Final 
Determination of Critical Circumstances: Certain Cold-Rolled Carbon 
Steel Flat Products From Argentina, 67 FR 62138 (October 3,

[[Page 20823]]

2002), and accompanying Issues and Decision Memorandum at Comment 1.
    We calculated CEP for the small number of San Miguel's sales as 
discussed above in accordance with section 772(d)(1) of the Act. For 
CEP, we would normally deduct direct selling expenses and indirect 
selling expenses related to commercial activity in the United States in 
accordance with section 772(d)(1) of the Act; however, for San Miguel 
we only made a deduction for its credit expenses. These credit expenses 
covered the time between the date of shipment from Buenos Aires until 
the date payment was received. Deducting U.S. inventory carrying costs 
would impermissibly double count a portion of these credit expenses, 
because the number of days between date of shipment from Buenos Aires 
and payment date includes the number of days the CEP sales spent in 
U.S. inventory. See 19 CFR 351.401(b)(2). Also, because there was no 
affiliate acting on San Miguel's behalf in the United States, there are 
no U.S. indirect selling expenses to deduct, except for a few sales 
involving commissions paid to unaffiliated parties (in which case we 
deducted commissions from the U.S. price). All expenses related to the 
U.S. warehousing of these CEP sales are accounted for in the U.S. 
warehousing expense field reported by San Miguel and deducted from 
price as a movement expense. See Analysis Memorandum for Lemon Juice 
from Argentina: San Miguel, April 19, 2007 (San Miguel Analysis 
Memorandum).

Normal Value

A. Selection of Comparison Market

    Section 773(a)(1) of the Act directs the Department to calculate NV 
based on the price at which the foreign like product is first sold in 
the home market, provided that the merchandise is sold in sufficient 
quantities (or value, if quantity is inappropriate), and that there is 
no particular market situation that prevents a proper comparison with 
the export price. Under the statute, the Department will normally 
consider quantity (or value) insufficient if it is less than five 
percent of the aggregate quantity (or value) of sales of the subject 
merchandise to the United States. See section 773(a)(1)(C) of the Act.
    Citrusvil's sales in Argentina were less than five percent of its 
sales to the United States; therefore, we found that Citrusvil did not 
have a viable home market for lemon juice to serve as the basis for 
comparison market sales in accordance with section 773(a)(1)(C) of the 
Act and 19 CFR 351.404. Citrusvil reports that it makes sales 
throughout Europe either to exclusive sales agents who then sell to 
unaffiliated customers (channel 1) or through the same exclusive agents 
to unaffiliated customers (channel 2). See Citrusvil December 18, 2006 
section A response at 2, 11. In both sales channels, Citrusvil controls 
the terms of sale which normally are made on a Free Carrier (FCA) 
Rotterdam basis. Under FCA sales terms, title and risk transfer from 
Citrusvil to the agent who collects payment from (and releases the 
merchandise to) the ultimate customer in sales designated as channel 1 
by Citrusvil. In sales designated as channel 2 sales by Citrusvil, 
title and risk transfer directly to the unaffiliated customers after 
that customer pays Citrusvil. See Citrusvil January 17, 2007, section B 
and C response, at B-8. In both sales channels, it appears that the 
customer (rather than Citrusvil) is responsible for any inland delivery 
within Europe.
    To determine the most appropriate third country market for 
comparison purposes, the Department examined the record evidence, 
including statements by Citrusvil. Initially Citrusvil claimed that it 
does not know with certainty to which European country its product is 
ultimately delivered. However, Citrusvil also stated that it believes 
the address on its invoice is the best indication of where the 
merchandise is ultimately delivered, and that customers with facilities 
in more than one country request that the invoice be issued to the 
address where the product is delivered. See Citrusvil December 18, 2006 
section A response, at A-2. Because the information we have gathered 
with respect to Citrusvil and its agents indicates that at the time of 
price and quantity negotiations, Citrusvil has knowledge of the first 
unaffiliated customer and the country in which such customer is 
located, we believe that it is appropriate to classify the sales 
shipped to Rotterdam based on the customer and its country of location.
    Classifying the sales as described above, we find that Germany is 
Citrusvil's largest third country market for sales of foreign like 
product. We further find that there are no significant differences in 
product comparability with respect to Citrusvil's sales to Germany and 
sales to other third country markets and merchandise sold to the United 
States. As such, we preliminarily determine that Germany is the 
appropriate comparison market. See ``Calculation of Normal Value Based 
on Comparison Market Prices'' and ``Calculation of Normal Value Based 
on Constructed Value'' sections below.
    San Miguel's sales of lemon juice in Argentina were sufficient to 
find the home market a viable for comparison purposes. Accordingly, we 
calculated NV for San Miguel based on sales prices to Argentine 
customers. See ``Calculation of Normal Value Based on Comparison Market 
Prices'' and ``Calculation of Normal Value Based on Constructed Value'' 
sections below.

B. Cost of Production Analysis

    In the petition, Petitioner alleged that Argentine producers/
exporters made sales in the comparison market at less than the cost of 
production (COP). In the allegation, Petitioner used the Netherlands as 
the comparison market, arguing that Argentina was not a viable market. 
Based on these allegations, and in accordance with section 
773(b)(2)(A)(i) of the Act, we found reasonable grounds to believe or 
suspect that lemon juice sales were made in the comparison market at 
prices below the COP and initiated a country-wide sales-below-cost 
investigation. See Initiation Notice.
    After reviewing Citrusvil's section A response, we determined that 
Citrusvil's sales to Argentina did not meet the viability threshold. 
Based on the section A response, however, it was unclear what the 
appropriate third-country comparison market was. As reported by 
Citrusvil, virtually all of its sales to Europe are shipped FCA 
Rotterdam. It claimed Germany as the proper comparison market based on 
the volume of sales to customers located in Germany. As discussed 
above, the Department has now determined that Germany is the most 
appropriate third-country market for comparison purposes. Although the 
sales-below-cost allegation from the petition involved shipments to the 
Netherlands-including, presumably, merchandise subsequently shipped to 
Germany-we informed the parties that the sales-below-cost allegation in 
the petition was still viable. See Letter from the Department to 
Citrusvil (December 22, 2007) stating that the ``allegation was made 
using shipment data to Rotterdam. The Rotterdam data did not exclude 
transhipments to other points in Europe, and thus should have included 
any transhipments to Germany.'' Citrusvil did not object to this 
request and submitted section D of its questionnaire response on 
January 22, 2007. Further, as noted above in the ``Case History'' 
section of this notice, on January 31, 2007, Petitioner submitted a 
German-specific, sales-below-cost allegation, which Citrusvil did not 
rebut.
    The petition compared COP to the FOB Rotterdam value of shipments 
to

[[Page 20824]]

the Netherlands. Citrusvil reports that it ships virtually everything 
sold to all countries in Europe to the Netherlands, on an FCA basis, at 
which point the product is claimed by customers and transported to 
different countries in Europe. Germany is the location of the customer 
for most of these shipments. Thus, because sales to Germany are 
subsumed in any shipments to the Netherlands, the petition allegation 
covered sales to Germany. As such, there was sufficient evidence on the 
record to continue our sales-below-cost investigation once we had 
determined that Germany was the appropriate comparison market.
    This decision is consistent with Department precedent. See, e.g., 
Preliminary Determination of Sales at Less Than Fair Value; Aramid 
Fiber Formed of Poly-Phenylene Terephthalamide From the Netherlands, 58 
FR 65699 (December 16, 1993) unchanged in the final determination, 
(Notice of Final Determination of Sales at Less Than Fair Value: Aramid 
Fiber Formed of Poly-Phenylene Terephthalamide From the Netherlands, 59 
FR 23684 (May 6, 1994)), in which the Department ``reanalyzed 
petitioner's sales below cost allegation in light of our 
determination'' that the Netherlands was not the proper comparison 
market, and determined that there was ``sufficient evidence on the 
record to continue our sales below cost investigation.''
    After reviewing San Miguel's section A response, we determined that 
Argentina was in fact a viable market for that company, and notified 
parties that the previous sales-below-cost allegation was no longer 
viable for San Miguel. See Letter from the Department to San Miguel 
(December 20, 2007). Petitioner subsequently filed a timely new sales-
below-cost allegation on January 24, 2007 with respect to San Miguel's 
sales in Argentina. After determining that the new allegation 
demonstrated reasonable grounds to believe that San Miguel's sales in 
Argentina were below cost, we initiated a new sales-below-cost 
investigation of that company. See Memorandum to Barbara E. Tillman, 
Director, Office 6, ``Petitioner's Allegation of Sales Below the Cost 
of Production for S.A. San Miguel A.G.I.C.I.y F.'' (February 12, 2007).

1. Calculation of Cost of Production

    In accordance with section 773(b)(3) of the Act, we calculated a 
weighted-average COP based on the sum of the cost of materials and 
fabrication for the foreign like product, plus amounts for the home 
market general and administrative (G&A) expenses, including interest 
expenses and packing expenses. For Citrusvil, we relied on the COP data 
submitted in its cost questionnaire responses, except as noted below:
     We adjusted the fresh lemon input costs to value the 
lemons transferred from the packing to processing plant at the average 
fresh lemon cost actually incurred or paid based on the company's 
normal books and records.
     For reporting to the Department, Citrusvil allocated fresh 
lemon costs to lemon co-products using a net realizable value (NRV) 
methodology. We note that an NRV methodology relies upon relative sales 
values at the split off point (i.e., when separate products are first 
identifiable in the production process) as a means of allocating joint 
costs when multiple products are processed simultaneously from the same 
raw material. However, because the fresh lemon cost allocation is based 
on sales values and because the Petitioner has alleged that Citrusvil's 
POI sales values may not represent a fair value for the merchandise 
under consideration, we revised the company's reported allocation to 
rely upon sales data prior to the POI, i.e., a period for which no 
allegation of dumping has been lodged (in this case, July 1, 2004 to 
June 30, 2005).
     We revised the reported G&A expense rate to include other 
operating expenses.
For further details regarding these adjustments, see Memorandum to Neal 
M. Halper, Director, Office of Accounting, ``Cost of Production and 
Constructed Value Calculation Adjustments for the Preliminary 
Determination - Citrusvil, S.A.'' (April 19, 2007) (Citrusvil COP 
Memo).
    For San Miguel, we relied on the COP data submitted in its cost 
questionnaire responses, except as noted below:
     We revised San Miguel's reported lemon costs. For self-
grown lemons, we allocated the growing costs to the lemons based on 
volume. For self-grown and purchased lemons harvested by San Miguel, we 
valued the harvesting costs at the actual costs incurred by San Miguel. 
For purchased lemons either harvested by San Miguel or delivered by the 
suppliers, we used the actual POI average purchase price.
     We recalculated the by-product offset amount by using the 
POI production quantities instead of the POI sales quantities
     For reporting to the Department, San Miguel allocated 
fresh lemon costs to lemon co-products using an NRV methodology. 
Because the fresh lemon cost allocation is based on sales values and 
because the Petitioner has alleged that San Miguel's POI sales values 
may not represent a fair value for the merchandise under consideration, 
we revised the company's reported allocation of fresh lemon costs and 
indirect processing costs to co-products, which was based on the POI 
sales data, to reflect sales data prior to the POI (in this case, July 
1, 2004 to June 30, 2005).
     We used San Miguel's company-wide G&A and net financial 
expense rates instead of the industrial division's G&A and net 
financial expense rates.
     We revised the company-wide G&A and net financial expense 
rates by deducting by-product revenues and packing expenses from the 
cost of sales denominator.
     We made a deduction to COM for estimated Reintegro rebates 
received by San Miguel.
For further details regarding these adjustments, see Memorandum to Neal 
M. Halper, Director, Office of Accounting, ``Cost of Production and 
Constructed Value Calculation Adjustments for the Preliminary 
Determination - San Miguel'' (April 19, 2007) (San Miguel COP Memo).

2. Test of Comparison Market Sales Prices

    We compared the weighted-average COPs for both companies to their 
comparison market sales prices of the foreign like product, under 
section 773(b) of the Act, to determine whether these sales had been 
made at prices below the COP within an extended period of time (i.e., a 
period of one year) in substantial quantities, and whether such prices 
were sufficient to permit the recovery of all costs within a reasonable 
period of time. On a model-specific basis, we compared the COP to the 
German (for Citrusvil) and Argentine (for San Miguel) market prices, 
less any applicable movement charges, discounts, rebates, and direct 
and indirect selling expenses (excluding imputed expenses), 
commissions, and packing.

3. Results of the COP Test

    Pursuant to section 773(b)(2)(C) of the Act, where less than 20 
percent of the respondent's sales of a given product during the POI are 
at prices less than the COP, we do not disregard any below-

[[Page 20825]]

cost sales of that product, because we determine that in such instances 
the below-cost sales were not made in substantial quantities. Where 20 
percent or more of the respondent's sales of a given product during the 
POI are at prices less than the COP, we determine that the below-cost 
sales represent substantial quantities within an extended period of 
time, in accordance with section 773(b)(1)(A) of the Act. In such 
cases, we also determine whether such sales were made at prices which 
would not permit recovery of all costs within a reasonable period of 
time, in accordance with section 773(b)(1)(B) of the Act.
    We found that more than 20 percent of Citrusvil's comparison market 
sales of a given product during the POI were at prices below the COP, 
and, in addition, the below-cost sales of the product were at prices 
which would not permit recovery of all costs within a reasonable time 
period, in accordance with section 773(b)(2)(D) of the Act. We 
therefore excluded these sales and used the remaining sales, if any, as 
the basis for determining NV, in accordance with section 773(b)(1) of 
the Act.
    We also found that more than 20 percent of San Miguel's comparison 
market sales of a given product during the POI were at prices below the 
COP, and, in addition, the below-cost sales of the product were at 
prices which would not permit recovery of all costs within a reasonable 
time period, in accordance with section 773(b)(2)(D) of the Act. We 
therefore excluded these sales and used the remaining sales, if any, as 
the basis for determining NV, in accordance with section 773(b)(1) of 
the Act.

C. Calculation of Normal Value Based on Comparison Market Prices

Citrusvil

    Citrusvil has an exclusive sales agreement with its agent in the 
German market. Due to the nature of the arrangement between the two 
companies, pursuant to section 771(33)(g) of the Act, we preliminarily 
find that Citrusvil and its agent are affiliated via an agent-principle 
agreement/relationship. See, e.g., Stainless Steel Sheet and Strip in 
Coils from Taiwan: Final Results and Partial Rescission of Antidumping 
Duty Administrative Review, 67 FR 6682 (February 13, 2002) and 
accompanying Issues and Decision Memorandum at Comment 23, upheld in 
Chia Far Industrial Factory Co. v. United States, 343 F. Supp. 2d 1344, 
1356 (CIT 2004) (``when there exists a principal who has the potential 
to control pricing and/or the terms of sale through the end-customer, 
Commerce will find agency and thus affiliation''). Thus, the 
appropriate sales for comparison purposes in this investigation are the 
sales from Citrusvil to the first unaffiliated customers in Germany. 
Since much of our analysis with respect to the relationship between 
Citrusvil and its agent involves business proprietary information, a 
full discussion of the bases for our finding of affiliation is set 
forth in the Citrusvil Analysis Memorandum.
    For those sales made directly to the customer, with Citrusvil's 
agent acting as intermediary (the channel 2 sales described in the 
``Selection of Comparison Market'' section above), the price charged by 
Citrusvil to the customer is the starting price. Pursuant to section 
773(a)(6)(B) of the Act, we deducted home market freight, warehousing 
and insurance expenses. We also made circumstances of sale (COS) 
adjustments reflecting differences between direct selling expenses 
(credit expense) incurred on third-country and U.S. sales, in 
accordance with section 773(a)(6)(C)(iii) of the Act and 19 CFR 
351.410. We also made adjustments for any differences in packing 
between domestic and U.S. sales, pursuant to section 773(a)(6)(B)(ii) 
of the Act, and any differences between the variable costs of the U.S. 
product and the matching home market product (the ``DIFMER'' 
adjustment), pursuant to section 773(a)(6)(C)(ii) of the Act and 19 CFR 
351.411.
    For sales made by Citrusvil to its affiliated agent (the channel 1 
sales described in the ``Selection of Comparison Market'' section 
above), which in turn sells to the first unaffiliated customer, we find 
that Citrusvil failed to provide the correct downstream sales 
information. Section 776(a)(2) of the Act provides that if an 
interested party or any other person: (A) withholds information that 
has been requested by the administering authority; (B) fails to provide 
such information by the deadlines for the submission of the information 
or in the form and manner requested, subject to subsections (c)(1) and 
(e) of section 782 of the Act; (C) significantly impedes a proceeding 
under this title; or (D) provides such information but the information 
cannot be verified as provided in section 782(i) of the Act, the 
Department shall, subject to section 782(d) of the Act, use the facts 
otherwise available in reaching the applicable determination under this 
title. In applying facts otherwise available, section 776(b) of the Act 
provides that the Department may use an inference adverse to the 
interests of a party that has failed to cooperate by not acting to the 
best of its ability to comply with the Department's requests for 
information. See, e.g., 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).
    With respect to adverse inferences, our practice, as reflected in 
the Statement of Administrative Action, is ``to ensure that the party 
does not obtain a more favorable result by failing to cooperate than if 
it had cooperated fully.'' See Statement of Administrative Action 
accompanying the Uruguay Round Agreements Act, H.R. Rep. No. 103-316, 
(1994) (``SAA'') at 870. Furthermore, ``affirmative evidence of bad 
faith on the part of a respondent is not required before the Department 
may make an adverse inference.'' See Nippon Steel Corp. v. United 
States, 337 F.3d 1373, 1377 (Fed. Cir. 2003); Antidumping 
Countervailing Duties: Final Rule, 62 FR 27296, 27340 (May 19, 1997).
    With respect to Citrusvil's channel 1 sales to Germany, we 
preliminarily find that the application of facts otherwise available is 
appropriate. The Department's original questionnaire, issued to 
Citrusvil on November 20, 2006, states that ``if you sold to an 
affiliate that resold the merchandise to an unaffiliated party in the 
comparison market, report the affiliate's resales during the POI to 
unaffiliated customers rather than your sales to the affiliate.'' See 
Department November 20, 2006, questionnaire, at B-2. On February 9, 
2007, Petitioner argued that it appeared that Citrusvil might be 
affiliated with its German agent. On February 16, 2007, we issued a 
supplemental questionnaire in which we requested more detailed 
information on the relationship between Citrusvil and its German agent. 
See Department February 16, 2007, General Supplemental questionnaire, 
at 1-3. Based on Citrusvil's response and our analysis of the 
agreement, there was sufficient information to indicate affiliation. On 
March 23, 2007, in an additional supplemental questionnaire to 
Citrusvil, the Department specifically requested that Citrusvil report 
the downstream sales of its German sales agent. On April 6, 2007, 
Citrusvil responded that it was not able to obtain the requested 
information from its agent. Citrusvil explained that it made several 
attempts (including phone calls and e-mails) to convince its agent to 
supply the requested information. However, Citrusvil reported that its 
agent was not willing to open its books to foreign authorities. See 
Citrusvil

[[Page 20826]]

April 6, 2007, third supplemental section B and C response, at Exhibit 
1. The use of facts available is warranted under 776(a)(2)(A) of the 
Act as Citrusvil and its affiliated agent have withheld information 
requested by the Department.
    Moreover, in accordance with section 776(b) of the Act, we have 
applied an adverse inference for purposes of calculating Citrusvil's 
channel 1 prices in Germany. The record of this investigation shows 
that Citrusvil has sufficient control over its agent and the sales at 
issue to comply with our request for channel 1 sales information. See 
Citrusvil March 12, 2007, Second Supplemental section B and C response, 
at Exhibit 2. These parties are bound through an exclusive principle-
agent relationship, and Citrusvil has indicated on the record that it 
controls the final terms of all sales involving its agent, including 
channel 1 sales. See Citrusvil January 26, 2007, Supplemental section A 
response, at Exhibit 5. Moreover, while Citrusvil argues that it made 
every effort to obtain the necessary information, it failed to submit 
any documentary evidence to support its claims. For example, in its 
April 6, 2007, submission Citrusvil states that it sent e-mails to its 
agent regarding the need for this information, but did not submit 
copies of any such e-mails on the record of this proceeding.
    The Department has consistently demonstrated willingness to 
accommodate Citrusvil's difficulties in collecting requested 
information in a timely manner throughout the course of this 
proceeding. In fact, the Department granted Citrusvil an extension to 
submit the downstream sales at issue. See Letter from the Department to 
Citrusvil (April 2, 2007). Citrusvil, however, failed to provide the 
downstream sales information by the extended deadline and failed to 
substantiate its claims that it made significant efforts to obtain the 
information.
    Therefore, we conclude that Citrusvil has not cooperated to the 
best of its ability with respect to channel 1 sales, and thus, pursuant 
to section 776(b) of the Act, we have used an adverse inference in 
selecting among the facts available with respect to such sales. 
Specifically, we have used the highest net price per control number 
(CONNUM) as the basis for normal value for all channel 1 sales. Because 
much of our analysis involves business proprietary information, a full 
discussion of the bases for our finding of affiliation and the specific 
application of partial adverse facts available is set forth in the 
Citrusvil Analysis Memorandum.
    As a result, for such sales, the Department has relied on facts 
available with an adverse inference. As AFA, to determine NV for these 
sales, the Department has used the highest NV per CONNUM in lieu of the 
price paid to Citrusvil's agent. The Department intends, however, 
following this preliminary determination, to provide an additional 
opportunity to Citrusvil to submit the requested sales information to 
the first unaffiliated customer in Germany.

San Miguel

    For San Miguel, starting with prices paid by its Argentine 
customers, we added or subtracted billing adjustments, where 
appropriate, and subtracted early payment discounts, Argentine inland 
freight, warehousing, and insurance expenses, and a fee paid to the 
regional government of Tucuman. For home market sales compared to EP 
sales, we made COS adjustments for differences between credit expenses 
incurred on Argentine and U.S. sales in accordance with section 
773(a)(6)(C)(iii) of the Act and 19 CFR 351.410. In accordance with 
section 772(c)(2) of the Act, for home market sales compared to CEP 
sales, we only deducted Argentine credit expenses from home market 
price, because U.S. credit expenses were deducted from U.S. price, as 
noted above. We also made adjustments for any differences in packing 
between domestic and U.S. sales and for DIFMER pursuant to section 
773(a)(6)(C)(ii) of the Act and 19 CFR 351.411.

D. Calculation of Normal Value Based on Constructed Value

    Section 773(a)(4) of the Act provides that, where NV cannot be 
based on comparison market sales, NV may be based on constructed value 
(CV). Accordingly, for sales of lemon juice for which we could not 
determine the NV based on comparison market sales, either because there 
were no useable sales of a comparable product or all sales of the 
comparable products failed the COP test, we based NV on CV.
    Section 773(e) of the Act provides that CV shall be based on the 
sum of the cost of materials and fabrication for the imported 
merchandise, plus amounts for SG&A expenses, profit, and U.S. packing 
costs. We calculated the cost of materials and fabrication based on the 
methodology described in the ``Cost of Production Analysis'' section, 
above. We based SG&A, interest expense, and profit on the actual 
amounts incurred and/or realized in connection with the production and 
sale of the foreign like product in the ordinary course of trade for 
consumption in the comparison market, in accordance with section 
773(e)(2)(A) of the Act.
    For comparison with EP sales, we made adjustments to CV for 
differences in COS in accordance with section 773(a)(6)(C)(iii) and 
773(a)(8) of the Act and 19 CFR 351.410. For CV compared to CEP sales, 
we only deducted domestic direct selling expenses from home market 
price, as U.S. direct selling expenses were deducted from U.S. price, 
as noted above.

E. Level of Trade

    In accordance with section 773(a)(1)(B)(i) of the Act, to the 
extent practicable, we determine NV based on sales in the home market 
at the same level of trade (LOT) as U.S. sales. See 19 CFR 351.412. The 
NV or CV LOT is the level of the starting-price sale in the home market 
or comparison market. For EP, the U.S. LOT is based on the starting 
price, which is usually from the exporter to the importer.
    To determine whether NV sales are at a different LOT than EP sales, 
we examine stages in the marketing process and selling functions along 
the chain of distribution between the producer and the unaffiliated 
customer in the home market in accordance with 19 CFR 351.412(c). See, 
e.g., Light-Walled Rectangular Pipe and Tube From Mexico: Notice of 
Final Determination of Sales at Less Than Fair Value, 69 FR 53677 
(September 2, 2004), and accompanying Issues and Decisions Memorandum 
at Comment 14. If the comparison market sales are at a different LOT, 
and the difference affects price comparability, as manifested in a 
pattern of consistent price differences between the sales on which NV 
is based and comparison market sales at the LOT of the export 
transaction, we make an LOT adjustment under section 773(a)(7)(A) of 
the Act.
    In the current investigation, Citrusvil claimed one LOT in the 
German market and one similar LOT in the U.S. market. Citrusvil did not 
request an LOT adjustment. Citrusvil maintains that its selling 
functions do not vary by market. Citrusvil's narrative description of 
its sales and distribution process indicate that its sales functions 
involve inventory maintenance, freight service arrangements, 
advertising, negotiating sales terms, and arranging for domestic and 
foreign warehousing. It did not indicate a significant variance, 
however, among these common expense items according to market, channel 
of distribution, customer, or some other variable, nor do we see any 
reason to conclude that there is such variance. See Citrusvil December 
18, 2006 section A response, at A-13. Based on the

[[Page 20827]]

selling functions performed, we preliminarily determine that Citrusvil 
did not sell at different LOTs in the German and U.S. markets. After 
examining the selling functions for the one LOT reported in the United 
States, and the one reported LOT reported in the German market, we 
determine that these sales were all made at the same LOT.
    San Miguel claimed one LOT in the Argentine market and one LOT in 
the U.S. market. San Miguel did not request an LOT adjustment. Given 
the selling functions chart submitted by San Miguel and its narrative 
description of its sales and distribution process, it would appear its 
significant sales functions involve negotiating sales and delivery, 
providing customer-specific packaging, arranging transportation, and 
arranging for domestic and foreign warehousing. It did not indicate a 
significant variance, however, among these common expense items 
according to market, channel of distribution, customer, or some other 
variable, nor do we see any reason to conclude that there is such 
variance. See San Miguel December 14, 2006, section A response, at A-15 
- A-19. After examining the selling functions for the one LOT reported 
in the United States, and the one reported LOT reported in the 
Argentine market, we determine that these sales were all made at the 
same LOT.

Currency Conversions

    We made currency conversions into U.S. dollars in accordance with 
section 773A of the Act based on exchange rates in effect on the dates 
of the U.S. sales, as obtained from the Federal Reserve Bank (the 
Department's preferred source for exchange rates).

Critical Circumstances

    On March 30, 2007, Petitioner filed a timely allegation pursuant to 
section 733(e) of the Act that critical circumstances exist in the 
antidumping duty investigations of lemon juice from Argentina and 
Mexico. In addition, Petitioner requested that the Department request 
CBP to compile information on an expedited basis regarding entries of 
subject merchandise. See 19 CFR 351.206(g). In its allegation, 
Petitioner contends that there is a reasonable basis to believe or 
suspect that critical circumstances exist with respect to lemon juice 
from Argentina because the importers in this case knew or should have 
known that exporters were selling lemon juice at less than fair value 
and that there was likely to be material injury by reason of such 
sales; and that there have been a massive imports of lemon juice over a 
relatively short period. Since this allegation was filed at least 20 
days prior to the deadline for the Department's preliminary 
determination, we must issue our preliminary critical circumstances 
determination not later than the date of the preliminary determination. 
See 19 CFR 351.206(c)(2)(i); see also Policy Bulletin 98.4; ``Change in 
Policy Regarding Timing of Issuance of Critical Circumstances 
Determinations'' (63 FR 55364 (October 15, 1998)) for a further 
discussion of our practice.
    Petitioner contends that, in determining whether there is a 
reasonable basis to believe or suspect that an importer should have 
known that the exporter was selling lemon juice from Argentina at less 
than fair value, the Department normally considers margins of 25 
percent or more for EP sales and 15 percent or more for CEP 
transactions sufficient to impute knowledge of dumping. See, e.g., 
Notice of Preliminary Determination of Sales at Less Than Fair Value 
and Affirmative Preliminary Determination of Critical Circumstances: 
Wax and Wax/Resin Thermal Transfer Ribbons From Japan, 68 FR 71072, 
71076-77 (December 22, 2003) unchanged in the final determination, 
(Notice of Final Determination of Sales at Less Than Fair Value and 
Affirmative Final Determination of Critical Circumstances: Wax and Wax/
Resin Thermal Transfer Ribbons From Japan, 69 FR 11834 (March 12, 
2004)). Petitioner contends that the estimated dumping margin from the 
initiation of 102.46 for Argentina is well above the 25 percent 
sufficient to impute knowledge. See Initiation Notice.
    Petitioner contends that, in determining whether there have been 
massive imports, the Department normally considers imports during the 
comparison period that have increased 15 percent or more compared to 
the base period to be massive. See 19 CFR 351.206(h)(2). The petition 
for this case was filed on September 21, 2006. Petitioner provided 
import data from the ITC's ``Dataweb'' (https://dataweb.usitc.gov/) 
comparing subject imports in July through September 2006 to subject 
imports in the period October through December 2006. Petitioner 
calculated that subject imports from Argentina surged 147 percent. See 
Petitioner's March 30, 2007 Critical Circumstances Allegation at 5, 
Exhibit 1.
    Section 733(e)(1) of the Act provides that the Department will 
preliminarily determine that critical circumstances exist if there is a 
reasonable basis to believe or suspect that: (A)(i) there is a history 
of dumping and material injury by reason of dumped imports in the 
United States or elsewhere of the subject merchandise; or (ii) the 
person by whom, or for whose account, the merchandise was imported knew 
or should have known that the exporter was selling the subject 
merchandise at less than its fair value and that there was likely to be 
material injury by reason of such sales; and, (B) there have been 
massive imports of the subject merchandise over a relatively short 
period. Section 351.206(h)(1) of the Department's regulations provides 
that, in determining whether imports of the subject merchandise have 
been ``massive,'' the Department normally will examine: (i) the volume 
and value of the imports; (ii) seasonal trends; and (iii) the share of 
domestic consumption accounted for by the imports. In addition, 19 CFR 
351.206(h)(2) provides that an increase in imports of 15 percent during 
a ``relatively short period'' of time may be considered ``massive.'' 
Further, 19 CFR 351.206(i) defines ``relatively short period'' as 
normally being the period beginning on the date the proceeding begins 
(i.e., the date the petition is filed) and ending at least three months 
later.
    To determine whether there is a history of injurious dumping of the 
merchandise under investigation, in accordance with section 
733(e)(1)(A)(i) of the Act, the Department normally considers evidence 
of an existing antidumping duty order on the subject merchandise in the 
United States or elsewhere to be sufficient. See, e.g., Notice of 
Preliminary Determination of Sales at Less Than Fair Value: Certain 
Cut-To-Length Carbon Quality Steel Plate Products from Indonesia, 64 FR 
41206 (July 29, 1999) unchanged in the final determination, (Final 
Determination of Sales at Less Than Fair Value: Certain Cut-to-Length 
Carbon-Quality Steel Plate Products from Indonesia, 64 FR 73164 
(December 29, 1999)). With regard to imports of lemon juice from 
Argentina, Petitioner makes no specific mention of a history of dumping 
for Argentina. There have been no dumping orders issued by the United 
States or by any other country on lemon juice from Argentina. For this 
reason, the Department does not find a history of injurious dumping of 
the subject merchandise from Argentina pursuant to section 
733(e)(1)(A)(i) of the Act.
    To determine whether the person by whom, or for whose account, the 
merchandise was imported knew or should have known that the exporter 
was selling the subject merchandise at less than its fair value and 
that there

[[Page 20828]]

was likely to be material injury by reason of such sales in accordance 
with section 733(e)(1)(A)(ii) of the Act, the Department normally 
considers margins of 25 percent or more for EP sales, or 15 percent or 
more for CEP transactions, sufficient to impute knowledge of dumping. 
See, e.g., Notice of Preliminary Determination of Sales at Less Than 
Fair Value: Certain Lined Paper Products from Indonesia, 71 FR 15162 
(March 27, 2006) unchanged in the final determination, (Final 
Determination of Sales at Less Than Fair Value and Affirmative Final 
Determination of Critical Circumstances: Certain Lined Paper Products 
from Indonesia, 71 FR 47171 (August 16, 2006)).
    For Citrusvil and San Miguel, we determine that there is a 
sufficient basis to find that the importer should have known that the 
exporter was selling the subject merchandise at less than its fair 
value pursuant to section 733(e)(1)(A)(ii) of the Act, because the 
calculated margins are greater than 25 percent for both companies' 
sales. Consequently, we have imputed knowledge of dumping with regard 
to both respondents.
    Regarding the companies subject to the ``all others'' rate, it is 
the Department's normal practice to conduct its critical circumstances 
analysis for these companies based on the experience of investigated 
companies. See, e.g., Notice of Final Determination of Sales at Less 
Than Fair Value: Certain Steel Concrete Reinforcing Bars From Turkey, 
62 FR 9737, 9741 (March 4, 1997). However, the Department does not 
automatically extend an affirmative critical circumstances 
determination to companies covered by the ``all others'' rate. See, 
e.g., Notice of Final Determination of Sales at Less Than Fair Value: 
Stainless Steel Sheet and Strip in Coils from Japan, 64 FR 30574 (June 
8, 1999) (Stainless Steel from Japan). Instead, the Department 
considers the traditional critical circumstances criteria with respect 
to the companies covered by the ``all others'' rate. Consistent with 
Stainless Steel from Japan, the Department has, in this case, applied 
the traditional critical circumstances criteria to the ``all others'' 
category for the antidumping investigation of certain lemon juice from 
Argentina.
    The dumping margin for the ``all others'' category in the instant 
case exceeds the 25 percent threshold necessary to impute knowledge of 
dumping. Therefore, we find there is a reasonable basis to impute to 
importers, knowledge of dumping for the companies covered by the ``all 
others'' rate. Consequently, we preliminarily find that knowledge of 
dumping exists with regard to the companies subject to the ``all 
others'' rate.
    In determining whether there is a reasonable basis to believe or 
suspect that an importer knew or should have known that there was 
likely to be material injury by reason of dumped imports, consistent 
with section 733(e)(1)(A)(ii) of the Act, the Department normally will 
look to the preliminary injury determination of the ITC. See, e.g., 
Stainless Steel from Japan, 64 FR at 30578. On November 16, 2006, the 
ITC preliminarily found material injury to the domestic industry due to 
imports of lemon juice from Argentina and Mexico, which are alleged to 
be sold in the United States at less than fair value and, on this 
basis, the Department may impute knowledge of likelihood of injury to 
these respondents. See ITC Preliminary Report.
    In determining whether there are ``massive imports'' over a 
``relatively short period,'' pursuant to section 733(e)(1)(B) of the 
Act, the Department normally compares the import volumes of the subject 
merchandise for at least three months immediately preceding the filing 
of the petition (i.e., the ``base period'') to a comparable period of 
at least three months following the filing of the petition (i.e., the 
``comparison period''). Imports normally will be considered massive 
when imports during the comparison period have increased by 15 percent 
or more compared to imports during the base period.
    The Department requested and obtained from both respondents monthly 
shipment data from June 2006 through March 2007 in order to determine 
whether imports were massive. We also relied on U.S. import data found 
on the ITC's Dataweb for imports through January 2007 (i.e., the latest 
month for which complete data exist at the time of this preliminary 
determination).
    We have used a period of four months as the period for comparison 
in preliminarily determining whether imports of the subject merchandise 
have been massive. We believe that a four-month period is most 
appropriate as the basis for analysis because using four months 
captures all data available at this time, based on October 2006 as the 
beginning of the comparison period. Additionally, a four-month period 
properly reflects the ``relatively short period'' set forth in the 
statute for determining whether imports have been massive. See section 
733(e)(1)(B) of the Act. It is our practice to base the critical-
circumstances analysis on all available data, using base and comparison 
periods of no less than three months. See Notice of Preliminary 
Determination of Sales at Less Than Fair Value, Postponement of Final 
Determination, and Affirmative Preliminary Determination of Critical 
Circumstances: Certain Frozen and Canned Warmwater Shrimp from India, 
69 FR 47111 (Aug. 4, 2004) unchanged in the final determination, 
(Notice of Final Determination of Sales at Less Than Fair Value and 
Negative Final Determination of Critical Circumstances: Certain Frozen 
and Canned Warmwater Shrimp From India, 69 FR 76916 (December 23, 
2004)); and Notice of Final Determination of Sales at Le