Certain Orange Juice from Brazil: Preliminary Results and Partial Rescission of Antidumping Duty Administrative Review, 18773-18779 [E8-7220]

Agencies

• DEPARTMENT OF COMMERCE
• International Trade Administration

[Federal Register Volume 73, Number 67 (Monday, April 7, 2008)]
[Notices]
[Pages 18773-18779]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-7220]


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DEPARTMENT OF COMMERCE

International Trade Administration

A-351-840


Certain Orange Juice from Brazil: Preliminary Results and Partial 
Rescission of Antidumping Duty Administrative Review

AGENCY: Import Administration, International Trade Administration, 
Department of Commerce.
SUMMARY: In response to a request by the petitioners and two producers/
exporters of the subject merchandise, the Department of Commerce (the 
Department) is conducting an administrative review of the antidumping 
duty order on certain orange juice (OJ) from Brazil with respect to two 
producers/exporters of the subject merchandise to the United States. 
This is the first period of review (POR), covering August 24, 2005, 
through February 28, 2007.
    We have preliminarily determined that sales to the United States 
have been made below normal value (NV). If these preliminary results 
are adopted in the final results of this review, we will instruct U.S. 
Customs and Border Protection (CBP) to assess antidumping duties on all 
appropriate entries.
    In addition, we have preliminarily determined to rescind the review 
with respect to one company because it had no shipments of subject 
merchandise during the POR. Interested parties are invited to comment 
on the preliminary results.

EFFECTIVE DATE: April 7, 2008.

FOR FURTHER INFORMATION CONTACT: Elizabeth Eastwood, AD/CVD Operations, 
Office 2, Import Administration, International Trade Administration, 
U.S. Department of Commerce, 14th Street and Constitution Avenue, NW, 
Washington, DC 20230; telephone: (202) 482-3874.

SUPPLEMENTARY INFORMATION:

Background

    In March 2006, the Department published in the Federal Register an 
antidumping duty order on certain orange juice from Brazil. See 
Antidumping Duty Order: Certain Orange Juice from Brazil, 71 FR 12183 
(Mar. 9, 2006) (OJ Order). Subsequently, on February 2, 2007, the 
Department published in the Federal Register a notice of opportunity to 
request an administrative review of the antidumping duty order of 
certain orange juice from Brazil for the period August 24, 2005, 
through February 28, 2007. See Antidumping or Countervailing Duty 
Order, Finding, or Suspended Investigation; Opportunity to Request 
Administrative Review, 72 FR 9505 (Feb. 2, 2007).
    In accordance with 19 CFR 351.213(b)(2), on March 12 and 14, 2007, 
the Department received requests to conduct an administrative review of 
the antidumping duty order on OJ from Brazil from Fischer S/A - 
Agroindustria (Fischer) and Sucocitrico Cutrale, S.A. (Cutrale), 
respectively. In accordance with 19 CFR 351.213(b)(1), on March 30, 
2007, the petitioners (Florida Citrus Mutual, A. Duda & Sons, Citrus 
World Inc., and Southern Gardens Citrus Processing Corporation), also 
requested that the Department conduct an administrative review for 
Cutrale and Fischer, as well as for one additional producer/exporter, 
Coinbra-Frutesp (SA)/Louis Dreyfus Citrus (Coinbra-Frutesp).
    In April 2007, the Department initiated an administrative review 
for each of these companies. See Initiation of Antidumping and 
Countervailing Duty Administrative Reviews, 72 FR 20986 (Apr. 27, 
2007). Also in April 2007, we issued questionnaires to them.
    On May 1, 2007, Coinbra-Frutesp informed the Department that it 
made no entries of subject merchandise during the POR. We confirmed 
this claim with CBP information; therefore, we are preliminarily 
rescinding the review with respect to this company. For further 
discussion, see the ``Partial Rescission of Review'' section of this 
notice, below.
    On May 21 and 22, 2007, we received responses to section A of the 
questionnaire (i.e., the section covering general information) from 
Cutrale and Fischer, respectively. We received responses to sections B 
and C of the questionnaire (i.e., the sections covering sales in the 
home market and United States) from Fischer on June 1, 2007, and from 
Cutrale on June 12, 2007. We received responses to section D of the 
questionnaire (i.e., the section covering cost of production (COP)/
constructed value (CV)) from Cutrale on June 12, 2007, and from Fischer 
on June 25, 2007.
    From August 2007 through March 2008, we issued supplemental sales 
and cost questionnaires to Cutrale and Fischer. We received responses 
to these

[[Page 18774]]

questionnaires from September 2007 through March 2008.
    On September 11, 2007, in a separate segment of this proceeding, 
the Department initiated a changed circumstances review for Fischer to 
determine whether a change in the company's corporate organization in 
December 2006 was significant enough to warrant treating the company as 
a new entity (or alternatively to find that the new company was the 
successor-in-interest to Fischer). See Notice of Initiation and 
Preliminary Results of Antidumping Duty Changed Circumstances Review: 
Certain Orange Juice from Brazil, 72 FR 51798 (Sept. 11, 2007). On 
October 22, 2007, the Department determined that the new company, 
Fischer S.A. Comercio, Industria and Agricultura (Fischer Comercio), is 
the successor-in-interest to Fischer. See Notice of Final Results of 
Antidumping Duty Changed Circumstances Review: Certain Orange Juice 
from Brazil, 72 FR 59512 (Oct. 22, 2007). Therefore, we have treated 
these two companies as the same entity in this administrative review.
    On November 13, 2007, the Department extended the deadline for the 
preliminary results in this review until no later than March 31, 2007. 
See Certain Orange Juice from Brazil: Notice of Extension of Time 
Limits for the Preliminary Results of the First Administrative Review, 
72 FR 63874 (Nov. 13, 2007).

Scope of the Order

    The scope of this order includes certain orange juice for transport 
and/or further manufacturing, produced in two different forms: (1) 
Frozen orange juice in a highly concentrated form, sometimes referred 
to as frozen concentrated orange juice for manufacture (FCOJM); and (2) 
pasteurized single-strength orange juice which has not been 
concentrated, referred to as not-from-concentrate (NFC). At the time of 
the filing of the petition, there was an existing antidumping duty 
order on frozen concentrated orange juice (FCOJ) from Brazil. See 
Antidumping Duty Order; Frozen Concentrated Orange Juice from Brazil, 
52 FR 16426 (May 5, 1987). Therefore, the scope of this order with 
regard to FCOJM covers only FCOJM produced and/or exported by those 
companies which were excluded or revoked from the pre-existing 
antidumping order on FCOJ from Brazil as of December 27, 2004. Those 
companies are Cargill Citrus Limitada (Cargill), Coinbra-Frutesp, 
Cutrale, Fischer, and Montecitrus Trading S.A.
    Excluded from the scope of the order are reconstituted orange juice 
and frozen concentrated orange juice for retail (FCOJR). Reconstituted 
orange juice is produced through further manufacture of FCOJM, by 
adding water, oils and essences to the orange juice concentrate. FCOJR 
is concentrated orange juice, typically at 42 Brix, in a frozen state, 
packed in retail-sized containers ready for sale to consumers. FCOJR, a 
finished consumer product, is produced through further manufacture of 
FCOJM, a bulk manufacturer's product.
    The subject merchandise is currently classifiable under subheadings 
2009.11.00, 2009.12.25, 2009.12.45, and 2009.19.00 of the Harmonized 
Tariff Schedule of the United States (HTSUS). These HTSUS subheadings 
are provided for convenience and for customs purposes only and are not 
dispositive. Rather, the written description of the scope of the order 
is dispositive.

Partial Rescission of Review

    As noted above, on May 1, 2007, Coinbra-Frutesp informed the 
Department that it had no entries of subject merchandise to the United 
States during the POR. We have confirmed this with CBP. See the 
Memorandum to the File from Elizabeth Eastwood entitled, ``Placing 
Customs Entry Data on the Record of the 2005-2006 Antidumping Duty 
Administrative Review of Certain Orange Juice from Brazil,'' dated 
March 31, 2008. Therefore, in accordance with 19 CFR 351.213(d)(3), and 
consistent with the Department's practice, we are preliminarily 
rescinding our review with respect to Coinbra-Frutesp. See, e.g., 
Certain Steel Concrete Reinforcing Bars From Turkey; Final Results, 
Rescission of Antidumping Duty Administrative Review in Part, and 
Determination To Revoke in Part, 70 FR 67665, 67666 (Nov. 8, 2005).

Comparisons to Normal Value

    To determine whether sales of OJ by Cutrale and Fischer to the 
United States were made at less than NV, we compared constructed export 
price (CEP) to the NV, as described in the ``Constructed Export Price'' 
and ``Normal Value'' sections of this notice.
    Pursuant to section 777A(d)(2) of the Tariff Act of 1930, as 
amended (the Act), we compared the CEPs of individual U.S. transactions 
to the weighted-average NV of the foreign like product where there were 
sales made in the ordinary course of trade, as discussed in the ``Cost 
of Production Analysis'' section below.

Product Comparisons

    In accordance with section 771(16) of the Act, we considered all 
products produced by Curtrale and Fischer covered by the description in 
the ``Scope of the Order'' section, above, to be foreign like products 
for purposes of determining appropriate product comparisons to U.S. 
sales. Pursuant to 19 CFR 351.414(e)(2), we compared U.S. sales of OJ 
to sales of OJ in the home market within the contemporaneous window 
period, which extends from three months prior to the month of the first 
U.S. sale until two months after the last U.S. sale. Where there were 
no sales of identical merchandise in the home market made in the 
ordinary course of trade to compare to U.S. sales, we compared U.S. 
sales to sales of the most similar foreign like product made in the 
ordinary course of trade. In making the product comparisons, we matched 
foreign like products based on the physical characteristics reported by 
the respondents in the following order of importance: product type and 
organic designation. Where there were no sales of identical or similar 
merchandise made in the ordinary course of trade, we made product 
comparisons using CV.

Constructed Export Price

    For all U.S. sales made by Cutrale and Fischer, we used the CEP 
methodology specified in section 772(b) of the Act because the subject 
merchandise was sold for the account of these respondents by their U.S. 
subsidiaries in the United States to unaffiliated purchasers.

A. Cutrale

    In accordance with section 772(b) of the Act, we calculated CEP for 
those sales where the merchandise was 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, or by a seller affiliated with 
the producer or exporter, to a purchaser not affiliated with the 
producer or exporter. In this case, we are treating all of Cutrale's 
U.S. sales as CEP sales because they were made in the United States by 
Cutrale's U.S. affiliates on behalf of Cutrale, within the meaning of 
section 772(b) of the Act.
    We based CEP on the packed delivered prices to unaffiliated 
purchasers in the United States. For sales made pursuant to futures 
contracts, we adjusted the reported gross unit price (i.e., the notice 
price) to include gains and losses incurred on the futures contract 
which resulted in the shipment of subject merchandise. All other gains 
and losses related to futures

[[Page 18775]]

trading activities have been included in indirect selling expenses. 
Where appropriate, we included as part of the starting price certain 
additional revenue items received from the customer. Also where 
appropriate, we made adjustments for billing adjustments, discounts, 
and rebates.
    In addition, we made deductions for movement expenses, in 
accordance with section 772(c)(2)(A) of the Act; these included, where 
appropriate, foreign inland freight, foreign warehousing expenses, 
foreign brokerage and handling expenses, ocean freight, U.S. brokerage 
and handling, U.S. customs duties (including harbor maintenance fees 
and merchandise processing fees) offset by U.S. duty drawback and 
customs duty reimbursements, U.S. inland freight expenses (i.e., 
freight from port to warehouse), and U.S. warehousing expenses.
    In accordance with section 772(d)(1) of the Act and 19 CFR 
351.402(b), we deducted those selling expenses associated with economic 
activities occurring in the United States, including direct selling 
expenses (i.e., bank charges, commissions, imputed credit expenses, and 
repacking), and indirect selling expenses (including inventory carrying 
costs, gains and losses on ``rolled over'' futures contracts, and other 
indirect selling expenses). We recalculated inventory carrying costs 
using the manufacturing costs reported in Cutrale's most recent COP 
database, adjusted as noted in the ``Calculation of Cost of 
Production'' section of this notice, below.
    Pursuant to section 772(d)(3) of the Act, we further reduced the 
starting price by an amount for profit to arrive at CEP. In accordance 
with section 772(f) of the Act, we calculated the CEP profit rate using 
the expenses incurred by Cutrale and its U.S. affiliates on their sales 
of the subject merchandise in the United States and the profit 
associated with those sales.

B. Fischer

    In accordance with section 772(b) of the Act, we calculated CEP for 
those sales where the merchandise was 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, or by a seller affiliated with 
the producer or exporter, to a purchaser not affiliated with the 
producer or exporter. In this case, we are treating all of Fischer's 
U.S. sales as CEP sales because they were made in the United States by 
Fischer's U.S. affiliate on behalf of Fischer, within the meaning of 
section 772(b) of the Act.
    We based CEP on the packed delivered prices to unaffiliated 
purchasers in the United States. Where appropriate, we made adjustments 
for billing adjustments and rebates. We made deductions for movement 
expenses, in accordance with section 772(c)(2)(A) of the Act; these 
included, where appropriate, foreign inland freight expenses, foreign 
warehousing expenses, foreign brokerage and handling expenses, ocean 
freight expenses, bunker fuel surcharges, marine insurance expenses, 
U.S. brokerage and handling expenses, U.S. customs duties (including 
harbor maintenance fees and merchandise processing fees) offset by U.S. 
duty drawback and customs duty reimbursements, U.S. inland freight 
expenses (i.e., freight from port to warehouse or to customer), and 
U.S. warehousing expenses.
    In accordance with sections 772(d)(1) and (2) of the Act and 19 CFR 
351.402(b), we deducted those selling expenses associated with economic 
activities occurring in the United States, including direct selling 
expenses (i.e., additional processing expenses, imputed credit 
expenses, and repacking), and indirect selling expenses (including 
inventory carrying costs and other indirect selling expenses).
    Pursuant to section 772(d)(3) of the Act, we further reduced the 
starting price by an amount for profit to arrive at CEP. In accordance 
with section 772(f) of the Act, we calculated the CEP profit rate using 
the expenses incurred by Fischer and its U.S. affiliate on their sales 
of the subject merchandise in the United States and the profit 
associated with those sales.

Normal Value

A. Home Market Viability and Selection of Comparison Markets

    In order to determine whether there was a sufficient volume of 
sales in the home market to serve as a viable basis for calculating NV, 
we compared the volume of home market sales of the foreign like product 
to the volume of U.S. sales of the subject merchandise, in accordance 
with section 773(a)(1)(C) of the Act.
    We determined that the aggregate volume of home market sales of the 
foreign like product for both respondents was sufficient to permit a 
proper comparison with its U.S. sales of the subject merchandise.

B. Level of Trade

    Section 773(a)(1)(B)(i) of the Act states that, to the extent 
practicable, the Department will calculate NV based on sales at the 
same level of trade (LOT) as the export price (EP) or CEP. Sales are 
made at different LOTs if they are made at different marketing stages 
(or their equivalent). See 19 CFR 351.412(c)(2). Substantial 
differences in selling activities are a necessary, but not sufficient, 
condition for determining that there is a difference in the stages of 
marketing. Id. See also Notice of Final Determination of Sales at Less 
Than Fair Value: Certain Cut-to-Length Carbon Steel Plate From South 
Africa, 62 FR 61731, 61732 (Nov. 19, 1997) (Plate from South Africa). 
In order to determine whether the comparison market sales were at 
different stages in the marketing process than the U.S. sales, we 
reviewed the distribution system in each market (i.e., the chain of 
distribution), including selling functions, class of customer (customer 
category), and the level of selling expenses for each type of sale.
    Pursuant to section 773(a)(1)(B)(i) of the Act, in identifying LOTs 
for EP and comparison market sales (i.e., NV based on either home 
market or third country prices),\1\ we consider the starting prices 
before any adjustments. For CEP sales, we consider only the selling 
activities reflected in the price after the deduction of expenses and 
profit under section 772(d) of the Act. See Micron Technology, Inc. v. 
United States, 243 F.3d 1301, 1314 (Fed. Cir. 2001).
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    \1\ Where NV is based on CV, we determine the NV LOT based on 
the LOT of the sales from which we derive selling expenses, general 
and administrative (G&A) expenses, and profit for CV, where 
possible.
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    When the Department is unable to match U.S. sales of the foreign 
like product in the comparison market at the same LOT as the EP or CEP, 
the Department may compare the U.S. sale to sales at a different LOT in 
the comparison market. In comparing EP or CEP sales at a different LOT 
in the comparison market, where available data make it practicable, we 
make an LOT adjustment under section 773(a)(7)(A) of the Act. Finally, 
for CEP sales only, if the NV LOT is more remote from the factory than 
the CEP LOT and there is no basis for determining whether the 
difference in LOTs between NV and CEP affects price comparability 
(i.e., no LOT adjustment was practicable), the Department shall grant a 
CEP offset, as provided in section 773(a)(7)(B) of the Act. See Plate 
from South Africa, 62 FR at 61732-33.
    In this administrative review, we obtained information from each 
respondent regarding the marketing stages involved in making the 
reported home market and U.S. sales, including

[[Page 18776]]

a description of the selling activities performed by each respondent 
for each channel of distribution. Company-specific LOT findings are 
summarized below.

1. Cutrale

    Cutrale reported that it made CEP sales through one channel of 
distribution in the United States (i.e., sales via affiliated 
resellers) and thus the selling activities it performed did not vary by 
the type of customer. We examined the selling activities performed for 
this channel and found that Cutrale performed the following selling 
functions: customer contact and price negotiation; order processing; 
arranging for freight and the provision of customs clearance/brokerage 
services; and inventory maintenance. These selling activities can be 
generally grouped into four core selling function categories for 
analysis: 1) sales and marketing; 2) freight and delivery; 3) inventory 
maintenance and warehousing; and 4) warranty and technical support. 
Accordingly, based on the core selling functions, we find that Cutrale 
performed sales and marketing, freight and delivery services, and 
inventory maintenance and warehousing for U.S. sales. Because all sales 
in the United States are made through a single distribution channel, we 
preliminarily determine that there is one LOT in the U.S. market.
    With respect to the home market, Cutrale reported that it made 
sales through one channel of distribution (i.e., direct sales to soft 
drink manufacturers). We examined the selling activities performed for 
home market sales, and found that Cutrale performed the following 
selling functions: sales forecasting, strategic planning, order 
processing, limited advertising, engineering services/technical 
assistance, inventory maintenance and post-sale warehousing, 
guarantees, and packing. Accordingly, based on the core selling 
functions, we find that Cutrale performed sales and marketing, 
inventory maintenance and warehousing, and warranty and technical 
support for home market sales. Because all home market sales are made 
through a single distribution channel, we preliminarily determine that 
there is one LOT in the home market for Cutrale.
    Finally, we compared the CEP LOT to the home market LOT and found 
that the core selling functions performed for U.S. and home market 
customers do not differ significantly. Therefore, we determine that 
sales to the U.S. and home markets during the POR were made at the same 
LOT, and as a result, neither an LOT adjustment nor a CEP offset is 
warranted for Cutrale. We note that, while Cutrale is claiming a CEP 
offset in this proceeding, Cutrale itself admits that there are no 
significant differences between its sales process during the period of 
investigation of the less-than-fair-value (LTFV) investigation and the 
POR. See Cutrale's May 15, 2007, section A supplemental response at 
page 3. Consequently, because no compelling evidence exists that 
Cutrale's sales process changed during the POR of this administrative 
review, we continue to find that no CEP offset is warranted for 
Cutrale, as we did in the LTFV investigation. See Notice of Preliminary 
Determination of Sales at Less Than Fair Value, Postponement of Final 
Determination, and Affirmative Preliminary Critical Circumstances 
Determination: Certain Orange Juice from Brazil, 70 FR 49557, 49563 
(Aug. 24, 2005) (LTFV Preliminary Determination), unchanged in Notice 
of Final Determination of Sales at Less Than Fair Value and Affirmative 
Final Determination of Critical Circumstances: Certain Orange Juice 
from Brazil, 71 FR 2183 (Jan. 13, 2006) (LTFV Final Determination).

2. Fischer

    Fischer reported that it made CEP sales through one channel of 
distribution in the United States (i.e., sales via an affiliated 
reseller) and thus the selling activities it performed did not vary by 
the type of customer. We examined the selling activities performed for 
this channel and found that Fischer performed the following selling 
functions: customer contact and price negotiation; order processing; 
arranging for freight and the provision of customs clearance/brokerage 
services; and inventory maintenance. These selling activities can be 
generally grouped into four core selling function categories for 
analysis: 1) sales and marketing; 2) freight and delivery; 3) inventory 
maintenance and warehousing; and 4) warranty and technical support. 
Accordingly, based on the core selling functions, we find that Fischer 
performed sales and marketing, freight and delivery services, and 
inventory maintenance and warehousing for U.S. sales. Because all sales 
in the United States are made through a single distribution channel, we 
preliminarily determine that there is one LOT in the U.S. market.
    With respect to the home market, Fischer reported that it made 
sales through one channel of distribution and that the selling 
activities it performed did not vary by the type of customer. We 
examined the selling activities performed for home market sales, and 
found that Fischer performed the following selling functions: customer 
contact and price negotiation; order processing; arranging for freight; 
cold storage and inventory maintenance; and packing services. 
Accordingly, based on the core selling functions, we find that Fischer 
performed sales and marketing, freight and delivery services, and 
inventory maintenance and warehousing for home market sales. Because 
all home market sales are made through a single distribution channel, 
we preliminarily determine that there is one LOT in the home market for 
Fischer.
    Finally, we compared the CEP LOT to the home market LOT and found 
that the core selling functions performed for U.S. and home market 
customers do not differ significantly. Therefore, we determine that 
sales to the U.S. and home markets during the POR were made at the same 
LOT, and as a result, neither an LOT adjustment nor a CEP offset is 
warranted for Fischer.

C. Cost of Production Analysis

    We found that both Cutrale and Fischer had made sales below the COP 
in the LTFV investigation, the most recently completed segment of this 
proceeding as of the date the questionnaire was issued in this review, 
and such sales were disregarded. For Fischer, see LTFV Preliminary 
Determination, 70 FR at 49564; unchanged in LTFV Final Determination. 
For Cutrale, see the Memorandum to the File from Elizabeth Eastwood 
entitled, ``Placing Sucocitrico Cutrale S.A.'s Comparison Market 
Program from the Final Determination of the Less Than Fair Value 
Investigation on the Record of the 2005-2007 Administrative Review of 
Certain Orange Juice from Brazil,'' dated March 31, 2008. Thus, in 
accordance with section 773(b)(2)(A)(ii) of the Act, there are 
reasonable grounds to believe or suspect that Cutrale and Fischer made 
home market sales at prices below the cost of producing the merchandise 
in the current review period.

1. Calculation of Cost of Production

    In accordance with section 773(b)(3) of the Act, we calculated the 
respondents' COPs based on the sum of their costs of materials and 
conversion for the foreign like product, plus amounts for G&A expenses 
and interest expenses (see ``Test of Comparison Market Sales Prices'' 
section, below, for treatment of home market selling expenses).
    The Department relied on the COP data submitted by each respondent 
in its most recently submitted cost database

[[Page 18777]]

for the COP calculation, except for the following instances:

a. Cutrale

    i. In accordance with the transactions disregarded rule, i.e., 
section 773(f)(2) of the Act, we adjusted Cutrale's cost of 
manufacturing to reflect the market value of oranges that were 
purchased from an affiliate.
    ii. We revised the calculation of the financial expense ratio to 
include all financial expenses and net foreign exchange gains and 
losses from the consolidated financial statements of Cutrale's highest 
level parent company in the numerator of the calculation and to reduce 
the denominator of the calculation by the revenue from the sales of by-
products.
    iii. We revised the calculation of the G&A expense ratio to include 
the cost of sales related to cattle in the denominator and to reduce 
the denominator by the revenue from the sales of by-products.
    For further discussion of these adjustments, see the Memorandum 
from James Balog, Senior Accountant, to Neal M. Halper, Director, 
Office of Accounting, entitled, ``Cost of Production and Constructed 
Value Adjustments for the Preliminary Results - Sucocitrico Cutrale 
Ltda,'' dated March 31, 2008.

b. Fischer

    i. The Department values the self-produced agricultural input used 
in the production of subject merchandise by multiplying the average 
per-unit cost to produce the input during the 12-month growing season 
by the quantity of the self-produced agricultural input used in the 
production of subject merchandise. In this segment of the proceeding, 
Fischer did not value the self-produced oranges used in the production 
of subject merchandise per the Department's normal methodology. 
Instead, Fischer valued the self-produced oranges used in the 
production of subject merchandise by dividing the total POR 
agricultural cost by the associated harvested quantity as opposed to 
dividing the 12-month growing season cost by the harvested quantity 
during the growing season. Because Fischer's reporting methodology of 
self-produced oranges is conservative and does not understate the cost 
of self-produced oranges, as neutral facts available, we have relied 
upon the reported cost of self-produced oranges for the preliminary 
results. However, the appropriate methodology for calculating the cost 
of self-produced oranges in this case and in future reviews is to 
calculate the average per-unit cost to produce oranges during the 12-
month growing season that most appropriately matches the POR.
    ii. We revised Fischer's reported product-specific manufacturing 
costs to allocate the common material and conversion costs to FCOJM, 
``Dairy Pak'' orange juice (``Dairy Pak''), and NFC based on the 
relative quantity of finished production of each type of orange juice 
converted into an equivalent brix level. We note that Fischer allocated 
these costs to FCOJM, ``Dairy Pak,'' and NFC based on the relative 
quantities of orange inputs used in the production of each type of 
orange juice.
    iii. We revised Fischer's G&A expense ratio to include a provision 
for losses on fruit contracts and labor claims, as well as expenses 
other than depreciation incurred by a collapsed affiliated entity 
during the 2006 fiscal year. Finally, we excluded by-product costs, 
packing, freight, storage, and other movement expenses from the cost of 
goods sold denominator of the G&A expense ratio.
    For further discussion of these adjustments, see the Memorandum 
from Sheikh M. Hannan, Senior Accountant, to Neal M. Halper, Director, 
Office of Accounting, entitled, ``Cost of Production and Constructed 
Value Adjustments for the Preliminary Results - Fischer S/A - 
Agroindustria,'' dated March 31, 2008.

2. Test of Comparison Market Sales Prices

    On a product-specific basis, we compared the adjusted weighted-
average COP to the home market sales prices of the foreign like 
product, as required under section 773(b) of the Act, in order to 
determine whether the sales prices were below the COP. For purposes of 
this comparison, we used COP exclusive of selling and packing expenses. 
The prices (inclusive of billing adjustments, where appropriate) were 
exclusive of any applicable movement charges, rebates, direct and 
indirect selling expenses and packing expenses, revised where 
appropriate, as discussed below under the ``Price-to-Price 
Comparisons'' section.

3. Results of the COP Test

    In determining whether to disregard home market sales made at 
prices below the COP, we examined, in accordance with sections 
773(b)(1)(A) and (B) or the Act: 1) whether, within an extended period 
of time, such sales were made in substantial quantities; and 2) whether 
such sales were made at prices which permitted the recovery of all 
costs within a reasonable period of time in the normal course of trade. 
Where less than 20 percent of the respondent's home market sales of a 
given product are at prices less than the COP, we do not disregard any 
below-cost sales of that product, because we determine that in such 
instances the below-cost sales were not made within an extended period 
of time and in ``substantial quantities.'' Where 20 percent or more of 
a respondent's sales of a given product are at prices less than the 
COP, we disregard the below-cost sales when: 1) they were made within 
an extended period of time in ``substantial quantities,'' in accordance 
with sections 773(b)(2)(B) and (C) of the Act, and 2) based on our 
comparison of prices to the weighted-average COPs for the POR, they 
were at prices which would not permit the recovery of all costs within 
a reasonable period of time, in accordance with section 773(b)(2)(D) of 
the Act.
    We found that, for certain products, more than 20 percent of 
Cutrale's and Fischer's home market sales were at prices less than the 
COP and, in addition, such sales did not provide for the recovery of 
costs within a reasonable period of time. We therefore excluded these 
sales and used the remaining sales as the basis for determining NV, in 
accordance with section 773(b)(1) of the Act.
    For those U.S. sales of subject merchandise for which there were no 
useable home market sales in the ordinary course of trade, we compared 
CEPs to the CV in accordance with section 773(a)(4) of the Act. See 
``Calculation of Normal Value Based on Constructed Value'' section 
below.

D. Calculation of Normal Value Based on Comparison Market Prices

1. Cutrale

    For Cutrale, we calculated NV based on ex-factory prices to 
unaffiliated customers. We included warehousing revenue in the starting 
price. We made adjustments, where appropriate, to the starting price 
for Brazilian taxes and billing adjustments in accordance with section 
773(a)(6)(B)(iii) of the Act. We made deductions from the starting 
price for home market credit expenses (offset

[[Page 18778]]

by interest revenue) pursuant to section 773(a)(6)(C) of the Act. Where 
applicable, in accordance with 19 CFR 351.410(e), we offset any 
commission paid on a U.S. sale by reducing the NV by the amount of home 
market indirect selling expenses and inventory carrying costs, up to 
the amount of the U.S. commission.
    Finally, we deducted home market packing costs and added U.S. 
packing costs, where appropriate, in accordance with sections 
773(a)(6)(A) and (B) of the Act. We also made adjustments for 
differences in costs attributable to differences in the physical 
characteristics of the merchandise in accordance with section 
773(a)(6)(C)(ii) of the Act and 19 CFR 351.411.

2. Fischer

    We calculated NV based on delivered prices to unaffiliated 
customers. We made adjustments, where appropriate, to the starting 
price for discounts in accordance with 19 CFR 351.401(c). We made 
adjustments, where appropriate, to the starting price for Brazilian 
taxes in accordance with section 773(a)(6)(B)(iii) of the Act. We 
deducted foreign inland freight expenses and inland insurance expenses 
in accordance with section 773(a)(6)(B)(ii) of the Act.
    In addition, we made deductions under section 773(a)(6)(C) of the 
Act for credit expenses (offset by interest revenue). Finally, we 
deducted home market packing costs in accordance with sections 
773(a)(6)(A) and (B) of the Act.

E. 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 CV. Accordingly, for 
those OJ products 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 G&A expenses, profit, and U.S. packing costs. 
For Fischer, we calculated the cost of materials and fabrication based 
on the methodology described in the ``Cost of Production Analysis'' 
section, above. We based G&A and profit for Fischer on the actual 
amounts incurred and realized by it in connection with the production 
and sale of the foreign like product in the ordinary course of trade 
for consumption in the home market, in accordance with section 
773(e)(2)(A) of the Act.
    We made adjustments to CV for differences in circumstances of sale 
in accordance with section 773(a)(8) of the Act and 19 CFR 351.410. For 
comparisons to CEP, we made circumstance-of-sale adjustments by 
deducting comparison market direct selling expenses from CV. See 19 CFR 
351.410(c).

Currency Conversion

    We made currency conversions into U.S. dollars in accordance with 
section 773A of the Act and 19 CFR 351.415, based on the exchange rates 
in effect on the dates of the U.S. sales as certified by the Federal 
Reserve Bank.

Preliminary Results of the Review

    We preliminarily determine that weighted-average dumping margins 
exist for the respondents for the period August 24, 2005, through 
February 28, 2007, as follows:

------------------------------------------------------------------------
                Manufacturer/Exporter                   Percent Margin
------------------------------------------------------------------------
Sucocitrico Cutrale, S.A............................                0.51
Fischer S/A Agroindustria/Fischer S.A. Comercio,                    2.46
 Industria, and Agricultura.........................
------------------------------------------------------------------------

Disclosure and Public Hearing

    The Department will disclose to parties the calculations performed 
in connection with these preliminary results within five days of the 
date of publication of this notice. See 19 CFR 351.224(b). Pursuant to 
19 CFR 351.309, interested parties may submit cases briefs not later 
than 30 days after the date of publication of this notice. Rebuttal 
briefs, limited to issues raised in the case briefs, may be filed not 
later than 35 days after the date of publication of this notice. 
Parties who submit case briefs or rebuttal briefs in this proceeding 
are requested to submit with each argument: 1) a statement of the 
issue; 2) a brief summary of the argument; and 3) a table of 
authorities. See 19 CFR 351.309(c)(2).
    Pursuant to 19 CFR 351.310(c), interested parties who wish to 
request a hearing, or to participate if one is requested, must submit a 
written request to the Assistant Secretary for Import Administration, 
Room 1870, within 30 days of the date of publication of this notice. 
Requests should contain: 1) the party's name, address and telephone 
number; 2) the number of participants; and, 3) a list of issues to be 
discussed. Id. Issues raised in the hearing will be limited to those 
raised in the respective case briefs. The Department will issue the 
final results of this administrative review, including the results of 
its analysis of the issues raised in any written briefs, not later than 
120 days after the date of publication of this notice, pursuant to 
section 751(a)(3)(A) of the Act.

Assessment Rates

    Upon completion of the administrative review, the Department shall 
determine, and CBP shall assess, antidumping duties on all appropriate 
entries, in accordance with 19 CFR 351.212. The Department will issue 
appropriate appraisement instructions for the companies subject to this 
review directly to CBP 15 days after the date of publication of the 
final results of this review.
    We will calculate importer-specific ad valorem duty assessment 
rates based on the ratio of the total amount of antidumping duties 
calculated for the examined sales to the total entered value of the 
sales which entered value was reported. We will instruct CBP to assess 
antidumping duties on all appropriate entries covered by this review if 
any importer-specific assessment rate calculated in the final results 
of this review is above de minimis. Pursuant to 19 CFR 351.106(c)(2), 
we will instruct CBP to liquidate without regard to antidumping duties 
any entries for which the assessment rate is de minimis. See 19 CFR 
351.106(c)(1). The final results of this review shall be the basis for 
the assessment of antidumping duties on entries of merchandise covered 
by the final results of this review and for future deposits of 
estimated duties, where applicable.
    The Department clarified its ``automatic assessment'' regulation on 
May 6, 2003. See Antidumping and Countervailing Duty Proceedings: 
Assessment of Antidumping Duties, 68 FR 23954 (May 6, 2003) (Assessment 
Policy Notice). This clarification will apply to entries of subject 
merchandise during the POR produced by companies included in this final 
results of review for which the reviewed companies did not know that 
the merchandise they sold to the intermediary (e.g., a reseller, 
trading company, or exporter) was destined for the United States. In 
such instances, we will instruct CBP to liquidate unreviewed entries at 
the all-others rate if there is no rate for the intermediary involved 
in the transaction. See Assessment Policy Notice for a full discussion 
of this clarification.

[[Page 18779]]

Cash Deposit Requirements

    The following cash deposit requirements will be effective for all 
shipments of the subject merchandise entered, or withdrawn from 
warehouse, for consumption on or after the publication date of the 
final results of this administrative review, as provided by section 
751(a)(2)(C) of the Act: 1) the cash deposit rate for each specific 
company listed above will be that established in the final results of 
this review, except if the rate is less than 0.50 percent and, 
therefore, de minimis within the meaning of 19 CFR 351.106(c)(1), in 
which case the cash deposit rate will be zero; 2) for previously 
reviewed or investigated companies not participating in this review, 
the cash deposit rate will continue to be the company-specific rate 
published for the most recent period; 3) if the exporter is not a firm 
covered in this review, or the original LTFV investigation, but the 
manufacturer is, the cash deposit rate will be the rate established for 
the most recent period for the manufacturer of the merchandise; and 4) 
the cash deposit rate for all other manufacturers or exporters will 
continue to be 16.51 percent, the all-others rate made effective by the 
LTFV investigation. See OJ Order, 71 FR at 12184. These deposit 
requirements, when imposed, shall remain in effect until further 
notice.

Notification to Importers

    This notice also serves as a preliminary reminder to importers of 
their responsibility under 19 CFR 351.402(f) to file a certificate 
regarding the reimbursement of antidumping duties prior to liquidation 
of the relevant entries during this review period. Failure to comply 
with this requirement could result in the Secretary's presumption that 
reimbursement of antidumping duties occurred and the subsequent 
assessment of double antidumping duties.
    This administrative review and notice are published in accordance 
with sections 751(a)(1) and 777(i)(1) of the Act and 19 CFR 351.221.

    Dated: March 31, 2008.
Stephen J. Claeys,
Acting Assistant Secretary for Import Administration.
[FR Doc. E8-7220 Filed 4-4-08; 8:45 am]
BILLING CODE 3510-DS-S