Drill Pipe from the People's Republic of China: Initiation of Antidumping Duty Investigations, 4531-4535 [2010-1795]

Download as PDF Federal Register / Vol. 75, No. 18 / Thursday, January 28, 2010 / Notices covered in this review, a prior review, or the original less-than-fair value investigation, but the manufacturer is, the cash-deposit rate will be the rate established for the most recent period for the manufacturer of the merchandise; and (3) the cash-deposit rate for all other manufacturers or exporters will continue to be the allothers rate of 15.67 percent, which is the all-others rate established in the less than fair value investigation. See Circular Welded Carbon Steel Pipes and Tubes from Thailand: Final Determination of Sales at Less Than Fair Value, 51 FR 3384 (January 27, 1986). These cash deposit requirements shall remain in effect until further notice. Notification to Importers This notice also serves as a final reminder to importers of their responsibility under 19 CFR 351.402(f)(2) 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 doubled antidumping duties. mstockstill on DSKH9S0YB1PROD with NOTICES Notification Regarding Administrative Protective Orders This notice also serves as a reminder to parties subject to administrative protective orders (APO) of their responsibility concerning the return or destruction of proprietary information disclosed under APO in accordance with 19 CFR 351.305, which continues to govern business proprietary information in this segment of the proceeding. Timely written notification of the return or destruction of APO materials or conversion to judicial protective order is hereby requested. Failure to comply with the regulations and terms of an APO is a violation that is subject to sanction. The final results of this new shipper review are issued and published in accordance with sections 751(a)(2)(B) and 777(i) of the Act and 19 CFR 351.214. Dated: January 21, 2010. Ronald K. Lorentzen, Deputy Assistant Secretary for Import Administration. Appendix Comments in the Issues and Decision Memorandum Comment 1: Whether the Department Should Use Invoice Date as the Date of Sale for the U.S. Sale in the Final Results. VerDate Nov<24>2008 17:16 Jan 27, 2010 Jkt 220001 Comment 2: Whether the Department Should Continue to Treat Home Market Pre-Sale Freight and Warehousing Expenses as Movement Expenses. Comment 3: Whether Pacific Pipe Has Established that Transportation Rates Paid to its Affiliated Carrier Are at Arm’s Length. [FR Doc. 2010–1783 Filed 1–27–10; 8:45 am] BILLING CODE 3510–DS–P DEPARTMENT OF COMMERCE International Trade Administration [A–570–965] Drill Pipe from the People’s Republic of China: Initiation of Antidumping Duty Investigations EFFECTIVE DATE: January 28, 2010. Toni Dach or Scot T. Fullerton, AD/CVD Operations, Office 9, (202) 482–1655 or (202) 482–1386, respectively; Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW, Washington, DC 20230. SUPPLEMENTARY INFORMATION: On December 31, 20091, the Department of Commerce (the ‘‘Department’’) received a petition concerning imports of drill pipe from the People’s Republic of China (‘‘PRC’’) filed in proper form by VAM Drilling USA, Inc., Texas Steel Conversion, Inc., Rotary Drilling Tools, TMK IPSCO, and the United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union, AFL–CIO-CLC (‘‘Petitioners’’). See ‘‘Petitions for the Imposition of Antidumping and Countervailing Duties: Drill Pipe from the People’s Republic of China,’’ dated December 31, 2009 (‘‘Petition’’). On January 6, 2010, the Department issued additional requests for information and clarification of certain areas of the Petition. Petitioners timely filed additional information on January 11, 2010. See ‘‘Drill Pipe from the People’s Republic of China,’’ dated January 11, FOR FURTHER INFORMATION CONTACT: 1 The Petitioners filed the Petition at the International Trade Commission (‘‘ITC’’) after 12:00 noon on December 30, 2009, therefore, pursuant to 19 CFR 207.10(a), the ITC deemed the Petition to have been filed on the next business day, December 31, 2009. Section 732(b)(2) of the Tariff Act of 1930, as amended (the ‘‘Act’’) requires simultaneous filings of antidumping duty petitions with the Department and the ITC, therefore, we deem the Petition to have been filed with the Department on December 31, 2009. This file date will change the initiation date from January 19, 2009, to January 20, 2009. See Memorandum to Ronald K. Lorentzen, entitled ‘‘Decision Memorandum Concerning Petitions Filing Date,’’ dated concurrently with this checklist. PO 00000 Frm 00009 Fmt 4703 Sfmt 4703 4531 2010 (‘‘Supplement to the PRC AD Petition’’). In addition, Petitioners further timely filed additional information pertaining to general issues in the Petition on January 11, 2010. See ‘‘Petition for the Imposition of Antidumping Duties on Drill Pipe from the PRC: Response to Department’s Letter of January 6, 2010,’’ dated January 11, 2010 (‘‘Supplement to the AD/CVD Petitions’’). On January 14, 2010, the Department issued a second request for information and clarification of certain areas of the Petition. Petitioners timely filed additional information on January 15, 2010. See ‘‘Petitions for the Imposition of Antidumping and Countervailing Duties: Response to the Department’s Letter of January 14, 2010,’’ dated January 15, 2010 (‘‘Second Supplement to the AD/CVD Petitions’’); see also ‘‘Petitions for the Imposition of Antidumping and Countervailing Duties: Drill Pipe from the PRC: Response to Department’s Letter of January 14, 2010: Additional Affidavit, dated January 15, 2010 (‘‘Third Supplement to the AD/CVD Petitions’’). On January 19, 2010, Petitioners filed further clarifications related to general issues. See ‘‘Petitions for the Imposition of Antidumping and Countervailing Duties: Drill Pipe from the PRC: Response to the Department’s letter of January 14, 2010: Additional Affidavit,’’ dated January 19, 2010 (‘‘Fourth Supplement to the AD/CVD Petitions’’). In addition, on both January 15, and January 19, 2010, we received comments filed by Lehnardt & Lehnardt, LLC, on behalf of Downhole Pipe & Equipment, LP (‘‘Downhole Pipe’’) and Command Energy Services International (‘‘Command Energy’’), U.S. importers of drill pipe from China. Downhole Pipe and Command Energy are interested parties as defined by section 771(9)(A) of the Act. The period of investigation (‘‘POI’’) is April 1, 2009, through September 30, 2009. See 19 CFR 351.204(b)(1). In accordance with section 732(b) of the Act, Petitioners allege that imports of drill pipe from the PRC are being, or are likely to be, sold in the United States at less than fair value, within the meaning of section 731 of the Act, and that such imports are materially injuring, or threatening material injury to, an industry in the United States. The Department finds that Petitioners filed the Petition on behalf of the domestic industry because Petitioners are an interested party, as defined in section 771(9)(C) and (D) of the Act, and have demonstrated sufficient industry support with respect to the antidumping duty investigation that Petitioners are requesting the Department to initiate E:\FR\FM\28JAN1.SGM 28JAN1 4532 Federal Register / Vol. 75, No. 18 / Thursday, January 28, 2010 / Notices (see ‘‘Determination of Industry Support for the Petition’’ section below). Scope of the Investigation The product covered by this investigation is drill pipe from the PRC. For a full description of the scope of the investigation, please see ‘‘Scope of Investigation,’’ in Appendix I of this notice. mstockstill on DSKH9S0YB1PROD with NOTICES Comments on Scope of the Investigation During our review of the Petition, we discussed the scope with Petitioners to ensure that it is an accurate reflection of the products for which the domestic industry is seeking relief. Moreover, as discussed in the preamble to the regulations (Antidumping Duties; Countervailing Duties; Final Rule, 62 FR 27296, 27323 (May 19, 1997)), we are setting aside a period for interested parties to raise issues regarding product coverage. The Department encourages interested parties to submit such comments by Wednesday, February 10, 2010, which is twenty calendar days from the signature date of this notice. Comments should be addressed to Import Administration’s APO/Dockets Unit, Room 1870, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW, Washington, DC 20230. The period of scope consultations is intended to provide the Department with ample opportunity to consider all comments and to consult with parties prior to the issuance of the preliminary determination. Comments on Product Characteristics for Antidumping Duty Questionnaires We are requesting comments from interested parties regarding the appropriate physical characteristics of drill pipe to be reported in response to the Department’s antidumping questionnaires. This information will be used to identify the key physical characteristics of the merchandise under consideration in order to more accurately report the relevant factors and costs of production, as well as to develop appropriate product comparison criteria. Interested parties may provide information or comments that they believe are relevant to the development of an accurate listing of physical characteristics. Specifically, they may provide comments as to which characteristics are appropriate to use as: 1) general product characteristics; and 2) the product comparison criteria. We note that it is not always appropriate to use all product characteristics as product comparison criteria. We base product comparison criteria on meaningful commercial differences VerDate Nov<24>2008 17:16 Jan 27, 2010 Jkt 220001 among products. In other words, while there may be some physical product characteristics utilized by manufacturers to describe drill pipe, it may be that only a select few product characteristics take into account commercially meaningful physical characteristics. In addition, interested parties may comment on the order in which the physical characteristics should be used in product matching. Generally, the Department attempts to list the most important physical characteristics first and the least important characteristics last. In order to consider the suggestions of interested parties in developing and issuing the antidumping duty questionnaires, we must receive comments at the above–referenced address by February 10, 2010. Additionally, rebuttal comments must be received by February 17, 2010. Determination of Industry Support for the Petition Section 732(b)(1) of the Act requires that a petition be filed on behalf of the domestic industry. Section 732(c)(4)(A) of the Act provides that a petition meets this requirement if the domestic producers or workers who support the petition account for: (i) at least 25 percent of the total production of the domestic like product; and (ii) more than 50 percent of the production of the domestic like product produced by that portion of the industry expressing support for, or opposition to, the petition. Moreover, section 732(c)(4)(D) of the Act provides that, if the petition does not establish support of domestic producers or workers accounting for more than 50 percent of the total production of the domestic like product, the Department shall: (i) poll the industry or rely on other information in order to determine if there is support for the petition, as required by subparagraph (A); or (ii) determine industry support using a statistically valid sampling method to poll the industry. Section 771(4)(A) of the Act defines the ‘‘industry’’ as the producers as a whole of a domestic like product. Thus, to determine whether a petition has the requisite industry support, the statute directs the Department to look to producers and workers who produce the domestic like product. The IITC, which is responsible for determining whether ‘‘the domestic industry’’ has been injured, must also determine what constitutes a domestic like product in order to define the industry. While both the Department and the ITC must apply the same statutory definition regarding the domestic like product (see section PO 00000 Frm 00010 Fmt 4703 Sfmt 4703 771(10) of the Act), they do so for different purposes and pursuant to a separate and distinct authority. In addition, the Department’s determination is subject to limitations of time and information. Although this may result in different definitions of the like product, such differences do not render the decision of either agency contrary to law. See USEC, Inc. v. United States, 132 F. Supp. 2d 1, 8 (CIT 2001), citing Algoma Steel Corp., Ltd. v. United States, 688 F. Supp. 639, 644 (CIT 1988), aff’d 865 F.2d 240 (Fed. Cir. 1989), cert. denied 492 U.S. 919 (1989). Section 771(10) of the Act defines the domestic like product as ‘‘a product which is like, or in the absence of like, most similar in characteristics and uses with, the article subject to an investigation under this title.’’ Thus, the reference point from which the domestic like product analysis begins is ‘‘the article subject to an investigation’’ (i.e., the class or kind of merchandise to be investigated, which normally will be the scope as defined in the petition). With regard to the domestic like product, Petitioners do not offer a definition of domestic like product distinct from the scope of the investigations. Based on our analysis of the information submitted on the record, we have determined that drill pipe constitutes a single domestic like product and we have analyzed industry support in terms of that domestic like product. For a discussion of the domestic like product analysis in this case, see Antidumping Duty Investigation Initiation Checklist: Drill Pipe from the People’s Republic of China (‘‘Checklist’’), at Attachment II, Industry Support, on file in the Central Records Unit, Room 1117 of the main Department of Commerce building. In determining whether Petitioners have standing under section 732(c)(4)(A) of the Act, we considered the industry support data contained in the Petition with reference to the domestic like product as defined in the ‘‘Scope of Investigations’’ section above. To establish industry support, Petitioners provided their production of the domestic like product in 2008, and compared this to the estimated total production of the domestic like product for the entire domestic industry. See Volume I of the Petition at 2–3; see also Supplement to the AD/CVD Petitions at 6–13 and Exhibit 3; Second Supplement to the AD/CVD Petitions at 1–4 and Exhibits 1–3; Third Supplement to the AD/CVD Petitions at Exhibit 1; and Fourth Supplement to the AD/CVD Petitions at Exhibit 1. To estimate 2008 production of the domestic like product, Petitioners used their own data and E:\FR\FM\28JAN1.SGM 28JAN1 Federal Register / Vol. 75, No. 18 / Thursday, January 28, 2010 / Notices mstockstill on DSKH9S0YB1PROD with NOTICES industry specific knowledge. See Second Supplement to the AD/CVD Petitions at 1–4 and Exhibits 1–3; see also Checklist at Attachment II. We have relied upon data Petitioners provided for purposes of measuring industry support. For further discussion, see Checklist at Attachment II. Based on information provided in the Petition, supplemental submissions, and other information readily available to the Department, we determine that the domestic producers and workers have met the statutory criteria for industry support under section 732(c)(4)(A)(i) of the Act because the domestic producers (or workers) who support the Petition account for at least 25 percent of the total production of the domestic like product. Because the Petition and supplemental submissions did not establish support from domestic producers (or workers) accounting for more than 50 percent of the total production of the domestic like product, the Department was required to take further action in order to evaluate industry support. See section 732(c)(4)(D) of the Act. In this case, the Department was able to rely on other information, in accordance with section 732(c)(4)(D)(i) of the Act, to determine industry support. See Checklist at Attachment II. Based on information provided in the Petition and other submissions, the domestic producers and workers have met the statutory criteria for industry support under section 732(c)(4)(A)(ii) of the Act because the domestic producers (or workers) who support the Petition account for more than 50 percent of the production of the domestic like product produced by that portion of the industry expressing support for, or opposition to, the Petition. Accordingly, the Department determines that the Petition was filed on behalf of the domestic industry within the meaning of section 732(b)(1) of the Act. See Checklist at Attachment II. The Department finds that Petitioners filed the Petition on behalf of the domestic industry because it is an interested party as defined in section 771(9)(C) and (D) of the Act and it has demonstrated sufficient industry support with respect to the antidumping duty investigations that it is requesting the Department initiate. Id. Allegations and Evidence of Material Injury and Causation Petitioners allege that the U.S. industry producing the domestic like product is being materially injured, or is threatened with material injury, by reason of the imports of the subject merchandise sold at less than normal VerDate Nov<24>2008 17:16 Jan 27, 2010 Jkt 220001 value (‘‘NV’’). In addition, Petitioners allege that subject imports exceed the negligibility threshold provided for under section 771(24)(A) of the Act. Petitioners contend that the industry’s injured condition is illustrated by reduced market share, reduced production, reduced shipments, reduced capacity and capacity utilization, underselling and price depression or suppression, reduced employment, hours worked, and wages paid, decline in financial performance, lost sales and revenue, and increase in import penetration. See Vol. I of the Petition, at 13–25. We have assessed the allegations and supporting evidence regarding material injury, threat of material injury, and causation, and we have determined that these allegations are properly supported by adequate evidence and meet the statutory requirements for initiation. See Checklist at Attachment III, Injury. Allegations of Sales at Less Than Fair Value The following is a description of the allegations of sales at less than fair value upon which the Department based its decision to initiate this investigation of imports of drill pipe from the PRC. The sources of data for the deductions and adjustments relating to the U.S. price and the factors of production are also discussed in the initiation checklist. See Checklist. U.S. Price Petitioners calculated export price (‘‘EP’’) based on documentation of offers for sale obtained from a confidential source. See Checklist; see also Vol. II of the Petition, at 2–4 and Exhibits II–3–B and II–3–C. Based on the terms of sale, Petitioners adjusted the export price for brokerage and handling and foreign domestic inland freight. See Checklist; see also Supplement to the AD PRC Petition at 4–5 and Exhibit 5. Petitioners also calculated margins based on the weighted average unit value data for the POI of imports from the PRC of drill pipe. Based on the terms of sale, Petitioners adjusted the export price for brokerage and handling and foreign domestic inland freight. Id. Normal Value Petitioners claim the PRC is a non– market economy (‘‘NME’’) country and that no determination to the contrary has been made by the Department. See Vol. I of the Petition, at 1. In accordance with section 771(18)(C)(i) of the Act, the presumption of NME status remains in effect until revoked by the Department. The presumption of NME status for the PRC has not been revoked by the PO 00000 Frm 00011 Fmt 4703 Sfmt 4703 4533 Department and, therefore, remains in effect for purposes of the initiation of this investigation. Accordingly, the NV of the product for the PRC investigation is appropriately based on factors of production valued in a surrogate market–economy country in accordance with section 773(c) of the Act. In the course of this investigation, all parties, including the public, will have the opportunity to provide relevant information related to the issue of the PRC’s NME status and the granting of separate rates to individual exporters. Petitioners contend that India is the appropriate surrogate country for the PRC because: 1) it is at a level of economic development comparable to that of the PRC and 2) it is a significant producer and exporter of comparable merchandise. See Vol. II of the Petition, at 1–2. Based on the information provided by Petitioners, we believe that it is appropriate to use India as a surrogate country for initiation purposes. After initiation of the investigation, interested parties will have the opportunity to submit comments regarding surrogate country selection and, pursuant to 19 CFR 351.301(c)(3)(i), will be provided an opportunity to submit publicly available information to value factors of production within 40 days after the date of publication of the preliminary determination. Petitioners calculated NV and the dumping margins using the Department’s NME methodology as required by 19 CFR 351.202(b)(7)(i)(C) and 19 CFR 351.408. Petitioners calculated NV based on consumption rates of the factors of production on the average consumption rates of a drill pipe producer in the United States (‘‘Surrogate Domestic Producer’’) for identical or similar merchandise. See Vol. II of the Petition, at 5–6 and Exhibit II–1–B. In calculating NV, Petitioners based the quantity of each of the inputs used to manufacture drill pipe in the PRC on product–specific production costs and/or consumption rates of the Surrogate Domestic Producer during the POI. See Vol. II of the Petition, at 6–12 and Exhibits II–1–B, II–4. Petitioners state that the actual usage rates of the foreign manufacturers of drill pipe are not reasonably available; however, Petitioners note that according to the information available, the production of drill pipe relies on similar production methods to the Surrogate Domestic Producer. See Vol. II of the Petition, at 5; see also Supplement to the AD/CVD Petitions at 3–4. As noted above, Petitioners determined the consumption quantities of all raw materials based on the E:\FR\FM\28JAN1.SGM 28JAN1 mstockstill on DSKH9S0YB1PROD with NOTICES 4534 Federal Register / Vol. 75, No. 18 / Thursday, January 28, 2010 / Notices production experience of the Surrogate Domestic Producer. Petitioners valued the factors of production based on reasonably available, public surrogate country data, specifically, Indian import statistics from the Global Trade Atlas (‘‘GTA’’).2 See Vol. II of the Petition, at 6; see also Supplement to the AD/CVD Petitions at 5 and Exhibit 5. Petitioners excluded from these import statistics imports from countries previously determined by the Department to be NME countries. Petitioners also excluded import statistics from Indonesia, the Republic of Korea, and Thailand, as the Department has previously excluded prices from these countries because they maintain broadly available, non–industry-specific export subsidies.3 Id. In addition, Petitioners made currency conversions, where necessary, based on the POI–average rupee/U.S. dollar exchange rate, as reported on the Department’s web site. See Vol. II of the Petition, at Exhibit II– 5. Petitioners determined labor costs using the labor consumption, in hours, derived from the Surrogate Domestic Producer’s experience. See Vol. II of the Petition, at 12 and Exhibit II–4–C–1. Petitioners valued labor costs using the Department’s NME Wage Rate for the PRC at http://ia.ita.doc.gov/wages/ 07wages/final/final–2009–2007– wages.html. Id. For purposes of initiation, the Department determines that the surrogate values used by Petitioners are reasonably available and, thus, acceptable for purposes of initiation. Petitioners determined electricity costs using the electricity consumption, in kilowatt hours, derived from the Surrogate Domestic Producer’s experience. See Vol. II of the Petition, at 11–12 and Exhibit II–4–C–1; see also Supplement to the AD/CVD Petitions at 3 and Exhibit 3. Petitioners valued electricity using the Indian electricity rate reported by the Central Electric Authority of the Government of India. See Vol. II of the Petition, at 11–12 and Exhibit II–4–C–2. Petitioners did not identify packing materials used in preparing finished drill pipe. Consequently, Petitioners did not include packing materials in its calculation of normal value. See Second Supplement to the AD/CVD Petitions at 5. 2 Petitioners also provided NV calculations based on their purchase price for tool joints. Id; see also Checklist for more discussion on these calculations, as well as the ‘‘Fair-Value Comparison’’ section below. 3 We adjusted Petitioners’ data to exclude the inflators used to inflate the contemporaneous GTA data. VerDate Nov<24>2008 17:16 Jan 27, 2010 Jkt 220001 Petitioners based factory overhead, selling, general and administrative, and profit on data from Oil Country Tubular Ltd., a producer of similar merchandise, for the 2008 – 2009 fiscal year. See Vol. II of the Petition, at 12 and Exhibit II4–D–1. Fair–Value Comparisons Based on the data provided by Petitioners, there is reason to believe that imports of drill pipe from the PRC are being, or are likely to be, sold in the United States at less than fair value. Based on a comparison of U.S. prices and NV calculated in accordance with section 773(c) of the Act, the estimated dumping margins for drill pipe from the PRC, using GTA values for all inputs, range from 429.53 percent to 496.93 percent. See Checklist and Second Supplement to the AD/CVD Petitions at Exhibit 5. In addition, Petitioners provided estimated dumping margins using POI average–unit values for imports of PRC–origin drill pipe into the United States, and Petitioners’ own cost data for tool joints. See Checklist at 10. Initiation of Antidumping Investigation Based upon the examination of the Petition on drill pipe from the PRC, the Department finds the Petition meets the requirements of section 732 of the Act. Therefore, we are initiating an antidumping duty investigation to determine whether imports of drill pipe from the PRC are being, or are likely to be, sold in the United States at less than fair value. In accordance with section 733(b)(1)(A) of the Act and 19 CFR 351.205(b)(1), unless postponed, we will make our preliminary determinations no later than 140 days after the date of this initiation. Targeted–Dumping Allegations On December 10, 2008, the Department issued an interim final rule for the purpose of withdrawing 19 CFR 351.414(f) and (g), the regulatory provisions governing the targeteddumping analysis in antidumping duty investigations, and the corresponding regulation governing the deadline for targeted–dumping allegations, 19 CFR 351.301(d)(5). See Withdrawal of the Regulatory Provisions Governing Targeted Dumping in Antidumping Duty Investigations, 73 FR 74930 (December 10, 2008). The Department stated that ‘‘withdrawal will allow the Department to exercise the discretion intended by the statute and, thereby, develop a practice that will allow interested parties to pursue all statutory avenues of relief in this area.’’ Id. at 74931. PO 00000 Frm 00012 Fmt 4703 Sfmt 4703 In order to accomplish this objective, if any interested party wishes to make a targeted- dumping allegation in either of these investigations pursuant to section 777A(d)(1)(B) of the Act, such allegations are due no later than 45 days before the scheduled date of the preliminary determination. Respondent Selection For this investigation, the Department will request quantity and value information from known exporters and producers identified with complete contact information in the Petition. The quantity and value data received from NME exporters/producers will be used as the basis to select the mandatory respondents. The Department requires that the respondents submit a response to both the quantity and value questionnaire and the separate–rate application by the respective deadlines in order to receive consideration for separate–rate status. See Circular Welded Austenitic Stainless Pressure Pipe from the People’s Republic of China: Initiation of Antidumping Duty Investigation, 73 FR 10221, 10225 (February 26, 2008); Initiation of Antidumping Duty Investigation: Certain Artist Canvas From the People’s Republic of China, 70 FR 21996, 21999 (April 28, 2005). On the date of the publication of this initiation notice in the Federal Register, the Department will post the quantity and value questionnaire along with the filing instructions on the Import Administration web site at http:// ia.ita.doc.gov/ia–highlights-and– news.html, and a response to the quantity and value questionnaire is due no later than February 11, 2010. Also, the Department will send the quantity and value questionnaire to those PRC companies identified in the Petition at Exhibit I–7 and in the Second Supplement to the AD/CVD Petitions at Exhibit 4. Interested parties must submit applications for disclosure under APO in accordance with 19 CFR 351.305. Instructions for filing such applications may be found on the Department’s web site at http://ia.ita.doc.gov/apo. Separate Rates Application In order to obtain separate–rate status in NME investigations, exporters and producers must submit a separate–rate status application. See Policy Bulletin 05.1: Separate–Rates Practice and Application of Combination Rates in Antidumping Investigations involving Non–Market Economy Countries, dated April 5, 2005 (‘‘Policy Bulletin’’), available on the Department’s web site at http://ia.ita.doc.gov/policy/bull05– E:\FR\FM\28JAN1.SGM 28JAN1 Federal Register / Vol. 75, No. 18 / Thursday, January 28, 2010 / Notices mstockstill on DSKH9S0YB1PROD with NOTICES 1.pdf. Based on our experience in processing the separate–rate applications in previous antidumping duty investigations, we have modified the application for this investigation to make it more administrable and easier for applicants to complete. See, e.g., Initiation of Antidumping Duty Investigation: Certain New Pneumatic Off–the-Road Tires From the People’s Republic of China, 72 FR 43591, 43594– 95 (August 6, 2007). The specific requirements for submitting the separate–rate application in this investigation are outlined in detail in the application itself, which will be available on the Department’s web site at http://ia.ita.doc.gov/ia–highlightsand–news.html on the date of publication of this initiation notice in the Federal Register. The separate–rate application will be due 60 days after publication of this initiation notice. For exporters and producers who submit a separate–rate status application and subsequently are selected as mandatory respondents, these exporters and producers will no longer be eligible for consideration for separate rate status unless they respond to all parts of the questionnaire as mandatory respondents. As noted in the ‘‘Respondent Selection’’ section above, the Department requires that respondents submit a response to both the quantity and value questionnaire and the separate rate application by the respective deadlines in order to receive consideration for separate–rate status. Use of Combination Rates in an NME Investigation The Department will calculate combination rates for certain respondents that are eligible for a separate rate in this investigation. The Policy Bulletin states: {W}hile continuing the practice of assigning separate rates only to exporters, all separate rates that the Department will now assign in its NME investigations will be specific to those producers that supplied the exporter during the period of investigation. Note, however, that one rate is calculated for the exporter and all of the producers which supplied subject merchandise to it during the period of investigation. This practice applies both to mandatory respondents receiving an individually calculated separate rate as well as the pool of non– investigated firms receiving the weighted–average of the individually calculated rates. This practice is referred to as the application of ‘‘combination rates’’ VerDate Nov<24>2008 17:16 Jan 27, 2010 Jkt 220001 because such rates apply to specific combinations of exporters and one or more producers. The cash– deposit rate assigned to an exporter will apply only to merchandise both exported by the firm in question and produced by a firm that supplied the exporter during the period of investigation. See Policy Bulletin at 6 (emphasis added). Distribution of Copies of the Petition In accordance with section 732(b)(3)(A) of the Act and 19 CFR 351.202(f), copies of the public versions of the Petition have been provided to the representatives of the Government of the PRC. Because of the large number of producers/exporters identified in the Petition, the Department considers the service of the public version of the Petition to the foreign producers/ exporters satisfied by the delivery of the public version to the Government of the PRC, consistent with 19 CFR 351.203(c)(2). 4535 unfinished tubes for casing or tubing covered by any other antidumping or countervailing duty order. The subject products are currently classified in the following Harmonized Tariff Schedule of the United States (HTSUS) categories: 7304.22.0030, 7304.22.0045, 7304.22.0060, 7304.23.3000, 7304.23.6030, 7304.23.6045, 7304.23.6060, 8431.43.8040 and may also enter under 8431.43.8060, 8431.43.4000, 7304.39.0028, 7304.39.0032, 7304.39.0036, 7304.39.0040, 7304.39.0044, 7304.39.0048, 7304.39.0052, 7304.39.0056, 7304.49.0015, 7304.49.0060, 7304.59.8020, 7304.59.8025, 7304.59.8030, 7304.59.8035, 7304.59.8040, 7304.59.8045, 7304.59.8050, and 7304.59.8055.4 While HTSUS subheadings are provided for convenience and Customs purposes, the written description of the scope of the investigation is dispositive. [FR Doc. 2010–1795 Filed 1–27–10; 8:45 am] BILLING CODE 3510–DS–S ITC Notification We have notified the ITC of our initiations, as required by section 732(d) of the Act. Preliminary Determinations by the ITC The ITC will preliminarily determine, no later than February 16, 2010, whether there is a reasonable indication that imports of drill pipe from the PRC are materially injuring, or threatening material injury to a U.S. industry. A negative ITC determination will result in the investigation being terminated; otherwise, this investigation will proceed according to statutory and regulatory time limits. This notice is issued and published pursuant to section 777(i) of the Act. Dated January 20, 2010. Ronald K. Lorentzen, Deputy Assistant Secretary for Import Administration. Appendix I Scope of the Investigation The products covered by the investigation are steel drill pipe, and steel drill collars, whether or not conforming to American Petroleum Institute (API) or non–API specifications, whether finished or unfinished (including green tubes suitable for drill pipe), without regard to the specific chemistry of the steel (i.e., carbon, stainless steel, or other alloy steel), and without regard to length or outer diameter. The scope does not include tool joints not attached to the drill pipe, nor does it include PO 00000 Frm 00013 Fmt 4703 Sfmt 4703 DEPARTMENT OF COMMERCE National Oceanic and Atmospheric Administration RIN 0648–XU07 Fisheries of the Gulf of Mexico; Southeast Data, Assessment, and Review (SEDAR); data workshop for yellowedge grouper and tilefish. AGENCY: National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce. ACTION: Notice of SEDAR Data Workshop for Gulf of Mexico yellowedge grouper and tilefish. SUMMARY: The SEDAR assessments of the Gulf of Mexico stocks of yellowedge grouper and tilefish will consist of a series of workshops and webinars: a Data Workshop, a series of Assessment webinars, and a Review Workshop. This is the twenty-second SEDAR. See SUPPLEMENTARY INFORMATION. DATES: The Data Workshop will take place March 15–19, 2010. See SUPPLEMENTARY INFORMATION for specific dates and times. ADDRESSES: The Data Workshop will be held at Quorum Hotel Tampa, 700 N. Westshore Blvd, Tampa, FL; telephone: (813) 289–8200. 4 Prior to February 2, 2007, these imports entered under different tariff classifications, including 7304.21.3000, 7304.21.6030, 7304.21.6045, and 7304.21.6060. E:\FR\FM\28JAN1.SGM 28JAN1

Agencies

[Federal Register Volume 75, Number 18 (Thursday, January 28, 2010)]
[Notices]
[Pages 4531-4535]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-1795]


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

DEPARTMENT OF COMMERCE

International Trade Administration

[A-570-965]


Drill Pipe from the People's Republic of China: Initiation of 
Antidumping Duty Investigations

EFFECTIVE DATE: January 28, 2010.

FOR FURTHER INFORMATION CONTACT: Toni Dach or Scot T. Fullerton, AD/CVD 
Operations, Office 9, (202) 482-1655 or (202) 482-1386, respectively; 
Import Administration, International Trade Administration, U.S. 
Department of Commerce, 14\th\ Street and Constitution Avenue, NW, 
Washington, DC 20230.

SUPPLEMENTARY INFORMATION: On December 31, 2009\1\, the Department of 
Commerce (the ``Department'') received a petition concerning imports of 
drill pipe from the People's Republic of China (``PRC'') filed in 
proper form by VAM Drilling USA, Inc., Texas Steel Conversion, Inc., 
Rotary Drilling Tools, TMK IPSCO, and the United Steel, Paper and 
Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service 
Workers International Union, AFL-CIO-CLC (``Petitioners''). See 
``Petitions for the Imposition of Antidumping and Countervailing 
Duties: Drill Pipe from the People's Republic of China,'' dated 
December 31, 2009 (``Petition''). On January 6, 2010, the Department 
issued additional requests for information and clarification of certain 
areas of the Petition. Petitioners timely filed additional information 
on January 11, 2010. See ``Drill Pipe from the People's Republic of 
China,'' dated January 11, 2010 (``Supplement to the PRC AD 
Petition''). In addition, Petitioners further timely filed additional 
information pertaining to general issues in the Petition on January 11, 
2010. See ``Petition for the Imposition of Antidumping Duties on Drill 
Pipe from the PRC: Response to Department's Letter of January 6, 
2010,'' dated January 11, 2010 (``Supplement to the AD/CVD 
Petitions''). On January 14, 2010, the Department issued a second 
request for information and clarification of certain areas of the 
Petition. Petitioners timely filed additional information on January 
15, 2010. See ``Petitions for the Imposition of Antidumping and 
Countervailing Duties: Response to the Department's Letter of January 
14, 2010,'' dated January 15, 2010 (``Second Supplement to the AD/CVD 
Petitions''); see also ``Petitions for the Imposition of Antidumping 
and Countervailing Duties: Drill Pipe from the PRC: Response to 
Department's Letter of January 14, 2010: Additional Affidavit, dated 
January 15, 2010 (``Third Supplement to the AD/CVD Petitions''). On 
January 19, 2010, Petitioners filed further clarifications related to 
general issues. See ``Petitions for the Imposition of Antidumping and 
Countervailing Duties: Drill Pipe from the PRC: Response to the 
Department's letter of January 14, 2010: Additional Affidavit,'' dated 
January 19, 2010 (``Fourth Supplement to the AD/CVD Petitions'').
---------------------------------------------------------------------------

    \1\ The Petitioners filed the Petition at the International 
Trade Commission (``ITC'') after 12:00 noon on December 30, 2009, 
therefore, pursuant to 19 CFR 207.10(a), the ITC deemed the Petition 
to have been filed on the next business day, December 31, 2009. 
Section 732(b)(2) of the Tariff Act of 1930, as amended (the 
``Act'') requires simultaneous filings of antidumping duty petitions 
with the Department and the ITC, therefore, we deem the Petition to 
have been filed with the Department on December 31, 2009. This file 
date will change the initiation date from January 19, 2009, to 
January 20, 2009. See Memorandum to Ronald K. Lorentzen, entitled 
``Decision Memorandum Concerning Petitions Filing Date,'' dated 
concurrently with this checklist.
---------------------------------------------------------------------------

    In addition, on both January 15, and January 19, 2010, we received 
comments filed by Lehnardt & Lehnardt, LLC, on behalf of Downhole Pipe 
& Equipment, LP (``Downhole Pipe'') and Command Energy Services 
International (``Command Energy''), U.S. importers of drill pipe from 
China. Downhole Pipe and Command Energy are interested parties as 
defined by section 771(9)(A) of the Act.
    The period of investigation (``POI'') is April 1, 2009, through 
September 30, 2009. See 19 CFR 351.204(b)(1).
    In accordance with section 732(b) of the Act, Petitioners allege 
that imports of drill pipe from the PRC are being, or are likely to be, 
sold in the United States at less than fair value, within the meaning 
of section 731 of the Act, and that such imports are materially 
injuring, or threatening material injury to, an industry in the United 
States.
    The Department finds that Petitioners filed the Petition on behalf 
of the domestic industry because Petitioners are an interested party, 
as defined in section 771(9)(C) and (D) of the Act, and have 
demonstrated sufficient industry support with respect to the 
antidumping duty investigation that Petitioners are requesting the 
Department to initiate

[[Page 4532]]

(see ``Determination of Industry Support for the Petition'' section 
below).

Scope of the Investigation

    The product covered by this investigation is drill pipe from the 
PRC. For a full description of the scope of the investigation, please 
see ``Scope of Investigation,'' in Appendix I of this notice.

Comments on Scope of the Investigation

    During our review of the Petition, we discussed the scope with 
Petitioners to ensure that it is an accurate reflection of the products 
for which the domestic industry is seeking relief. Moreover, as 
discussed in the preamble to the regulations (Antidumping Duties; 
Countervailing Duties; Final Rule, 62 FR 27296, 27323 (May 19, 1997)), 
we are setting aside a period for interested parties to raise issues 
regarding product coverage. The Department encourages interested 
parties to submit such comments by Wednesday, February 10, 2010, which 
is twenty calendar days from the signature date of this notice. 
Comments should be addressed to Import Administration's APO/Dockets 
Unit, Room 1870, U.S. Department of Commerce, 14\th\ Street and 
Constitution Avenue, NW, Washington, DC 20230. The period of scope 
consultations is intended to provide the Department with ample 
opportunity to consider all comments and to consult with parties prior 
to the issuance of the preliminary determination.

Comments on Product Characteristics for Antidumping Duty Questionnaires

    We are requesting comments from interested parties regarding the 
appropriate physical characteristics of drill pipe to be reported in 
response to the Department's antidumping questionnaires. This 
information will be used to identify the key physical characteristics 
of the merchandise under consideration in order to more accurately 
report the relevant factors and costs of production, as well as to 
develop appropriate product comparison criteria.
    Interested parties may provide information or comments that they 
believe are relevant to the development of an accurate listing of 
physical characteristics. Specifically, they may provide comments as to 
which characteristics are appropriate to use as: 1) general product 
characteristics; and 2) the product comparison criteria. We note that 
it is not always appropriate to use all product characteristics as 
product comparison criteria. We base product comparison criteria on 
meaningful commercial differences among products. In other words, while 
there may be some physical product characteristics utilized by 
manufacturers to describe drill pipe, it may be that only a select few 
product characteristics take into account commercially meaningful 
physical characteristics. In addition, interested parties may comment 
on the order in which the physical characteristics should be used in 
product matching. Generally, the Department attempts to list the most 
important physical characteristics first and the least important 
characteristics last.
    In order to consider the suggestions of interested parties in 
developing and issuing the antidumping duty questionnaires, we must 
receive comments at the above-referenced address by February 10, 2010. 
Additionally, rebuttal comments must be received by February 17, 2010.

Determination of Industry Support for the Petition

    Section 732(b)(1) of the Act requires that a petition be filed on 
behalf of the domestic industry. Section 732(c)(4)(A) of the Act 
provides that a petition meets this requirement if the domestic 
producers or workers who support the petition account for: (i) at least 
25 percent of the total production of the domestic like product; and 
(ii) more than 50 percent of the production of the domestic like 
product produced by that portion of the industry expressing support 
for, or opposition to, the petition. Moreover, section 732(c)(4)(D) of 
the Act provides that, if the petition does not establish support of 
domestic producers or workers accounting for more than 50 percent of 
the total production of the domestic like product, the Department 
shall: (i) poll the industry or rely on other information in order to 
determine if there is support for the petition, as required by 
subparagraph (A); or (ii) determine industry support using a 
statistically valid sampling method to poll the industry.
    Section 771(4)(A) of the Act defines the ``industry'' as the 
producers as a whole of a domestic like product. Thus, to determine 
whether a petition has the requisite industry support, the statute 
directs the Department to look to producers and workers who produce the 
domestic like product. The IITC, which is responsible for determining 
whether ``the domestic industry'' has been injured, must also determine 
what constitutes a domestic like product in order to define the 
industry. While both the Department and the ITC must apply the same 
statutory definition regarding the domestic like product (see section 
771(10) of the Act), they do so for different purposes and pursuant to 
a separate and distinct authority. In addition, the Department's 
determination is subject to limitations of time and information. 
Although this may result in different definitions of the like product, 
such differences do not render the decision of either agency contrary 
to law. See USEC, Inc. v. United States, 132 F. Supp. 2d 1, 8 (CIT 
2001), citing Algoma Steel Corp., Ltd. v. United States, 688 F. Supp. 
639, 644 (CIT 1988), aff'd 865 F.2d 240 (Fed. Cir. 1989), cert. denied 
492 U.S. 919 (1989).
    Section 771(10) of the Act defines the domestic like product as ``a 
product which is like, or in the absence of like, most similar in 
characteristics and uses with, the article subject to an investigation 
under this title.'' Thus, the reference point from which the domestic 
like product analysis begins is ``the article subject to an 
investigation'' (i.e., the class or kind of merchandise to be 
investigated, which normally will be the scope as defined in the 
petition).
    With regard to the domestic like product, Petitioners do not offer 
a definition of domestic like product distinct from the scope of the 
investigations. Based on our analysis of the information submitted on 
the record, we have determined that drill pipe constitutes a single 
domestic like product and we have analyzed industry support in terms of 
that domestic like product. For a discussion of the domestic like 
product analysis in this case, see Antidumping Duty Investigation 
Initiation Checklist: Drill Pipe from the People's Republic of China 
(``Checklist''), at Attachment II, Industry Support, on file in the 
Central Records Unit, Room 1117 of the main Department of Commerce 
building.
    In determining whether Petitioners have standing under section 
732(c)(4)(A) of the Act, we considered the industry support data 
contained in the Petition with reference to the domestic like product 
as defined in the ``Scope of Investigations'' section above. To 
establish industry support, Petitioners provided their production of 
the domestic like product in 2008, and compared this to the estimated 
total production of the domestic like product for the entire domestic 
industry. See Volume I of the Petition at 2-3; see also Supplement to 
the AD/CVD Petitions at 6-13 and Exhibit 3; Second Supplement to the 
AD/CVD Petitions at 1-4 and Exhibits 1-3; Third Supplement to the AD/
CVD Petitions at Exhibit 1; and Fourth Supplement to the AD/CVD 
Petitions at Exhibit 1. To estimate 2008 production of the domestic 
like product, Petitioners used their own data and

[[Page 4533]]

industry specific knowledge. See Second Supplement to the AD/CVD 
Petitions at 1-4 and Exhibits 1-3; see also Checklist at Attachment II. 
We have relied upon data Petitioners provided for purposes of measuring 
industry support. For further discussion, see Checklist at Attachment 
II.
    Based on information provided in the Petition, supplemental 
submissions, and other information readily available to the Department, 
we determine that the domestic producers and workers have met the 
statutory criteria for industry support under section 732(c)(4)(A)(i) 
of the Act because the domestic producers (or workers) who support the 
Petition account for at least 25 percent of the total production of the 
domestic like product. Because the Petition and supplemental 
submissions did not establish support from domestic producers (or 
workers) accounting for more than 50 percent of the total production of 
the domestic like product, the Department was required to take further 
action in order to evaluate industry support. See section 732(c)(4)(D) 
of the Act. In this case, the Department was able to rely on other 
information, in accordance with section 732(c)(4)(D)(i) of the Act, to 
determine industry support. See Checklist at Attachment II. Based on 
information provided in the Petition and other submissions, the 
domestic producers and workers have met the statutory criteria for 
industry support under section 732(c)(4)(A)(ii) of the Act because the 
domestic producers (or workers) who support the Petition account for 
more than 50 percent of the production of the domestic like product 
produced by that portion of the industry expressing support for, or 
opposition to, the Petition. Accordingly, the Department determines 
that the Petition was filed on behalf of the domestic industry within 
the meaning of section 732(b)(1) of the Act. See Checklist at 
Attachment II.
    The Department finds that Petitioners filed the Petition on behalf 
of the domestic industry because it is an interested party as defined 
in section 771(9)(C) and (D) of the Act and it has demonstrated 
sufficient industry support with respect to the antidumping duty 
investigations that it is requesting the Department initiate. Id.

Allegations and Evidence of Material Injury and Causation

    Petitioners allege that the U.S. industry producing the domestic 
like product is being materially injured, or is threatened with 
material injury, by reason of the imports of the subject merchandise 
sold at less than normal value (``NV''). In addition, Petitioners 
allege that subject imports exceed the negligibility threshold provided 
for under section 771(24)(A) of the Act.
    Petitioners contend that the industry's injured condition is 
illustrated by reduced market share, reduced production, reduced 
shipments, reduced capacity and capacity utilization, underselling and 
price depression or suppression, reduced employment, hours worked, and 
wages paid, decline in financial performance, lost sales and revenue, 
and increase in import penetration. See Vol. I of the Petition, at 13-
25. We have assessed the allegations and supporting evidence regarding 
material injury, threat of material injury, and causation, and we have 
determined that these allegations are properly supported by adequate 
evidence and meet the statutory requirements for initiation. See 
Checklist at Attachment III, Injury.

Allegations of Sales at Less Than Fair Value

    The following is a description of the allegations of sales at less 
than fair value upon which the Department based its decision to 
initiate this investigation of imports of drill pipe from the PRC. The 
sources of data for the deductions and adjustments relating to the U.S. 
price and the factors of production are also discussed in the 
initiation checklist. See Checklist.

U.S. Price

    Petitioners calculated export price (``EP'') based on documentation 
of offers for sale obtained from a confidential source. See Checklist; 
see also Vol. II of the Petition, at 2-4 and Exhibits II-3-B and II-3-
C. Based on the terms of sale, Petitioners adjusted the export price 
for brokerage and handling and foreign domestic inland freight. See 
Checklist; see also Supplement to the AD PRC Petition at 4-5 and 
Exhibit 5.
    Petitioners also calculated margins based on the weighted average 
unit value data for the POI of imports from the PRC of drill pipe. 
Based on the terms of sale, Petitioners adjusted the export price for 
brokerage and handling and foreign domestic inland freight. Id.

Normal Value

    Petitioners claim the PRC is a non-market economy (``NME'') country 
and that no determination to the contrary has been made by the 
Department. See Vol. I of the Petition, at 1. In accordance with 
section 771(18)(C)(i) of the Act, the presumption of NME status remains 
in effect until revoked by the Department. The presumption of NME 
status for the PRC has not been revoked by the Department and, 
therefore, remains in effect for purposes of the initiation of this 
investigation. Accordingly, the NV of the product for the PRC 
investigation is appropriately based on factors of production valued in 
a surrogate market-economy country in accordance with section 773(c) of 
the Act. In the course of this investigation, all parties, including 
the public, will have the opportunity to provide relevant information 
related to the issue of the PRC's NME status and the granting of 
separate rates to individual exporters.
    Petitioners contend that India is the appropriate surrogate country 
for the PRC because: 1) it is at a level of economic development 
comparable to that of the PRC and 2) it is a significant producer and 
exporter of comparable merchandise. See Vol. II of the Petition, at 1-
2. Based on the information provided by Petitioners, we believe that it 
is appropriate to use India as a surrogate country for initiation 
purposes. After initiation of the investigation, interested parties 
will have the opportunity to submit comments regarding surrogate 
country selection and, pursuant to 19 CFR 351.301(c)(3)(i), will be 
provided an opportunity to submit publicly available information to 
value factors of production within 40 days after the date of 
publication of the preliminary determination.
    Petitioners calculated NV and the dumping margins using the 
Department's NME methodology as required by 19 CFR 351.202(b)(7)(i)(C) 
and 19 CFR 351.408. Petitioners calculated NV based on consumption 
rates of the factors of production on the average consumption rates of 
a drill pipe producer in the United States (``Surrogate Domestic 
Producer'') for identical or similar merchandise. See Vol. II of the 
Petition, at 5-6 and Exhibit II-1-B. In calculating NV, Petitioners 
based the quantity of each of the inputs used to manufacture drill pipe 
in the PRC on product-specific production costs and/or consumption 
rates of the Surrogate Domestic Producer during the POI. See Vol. II of 
the Petition, at 6-12 and Exhibits II-1-B, II-4. Petitioners state that 
the actual usage rates of the foreign manufacturers of drill pipe are 
not reasonably available; however, Petitioners note that according to 
the information available, the production of drill pipe relies on 
similar production methods to the Surrogate Domestic Producer. See Vol. 
II of the Petition, at 5; see also Supplement to the AD/CVD Petitions 
at 3-4.
    As noted above, Petitioners determined the consumption quantities 
of all raw materials based on the

[[Page 4534]]

production experience of the Surrogate Domestic Producer. Petitioners 
valued the factors of production based on reasonably available, public 
surrogate country data, specifically, Indian import statistics from the 
Global Trade Atlas (``GTA'').\2\ See Vol. II of the Petition, at 6; see 
also Supplement to the AD/CVD Petitions at 5 and Exhibit 5. Petitioners 
excluded from these import statistics imports from countries previously 
determined by the Department to be NME countries. Petitioners also 
excluded import statistics from Indonesia, the Republic of Korea, and 
Thailand, as the Department has previously excluded prices from these 
countries because they maintain broadly available, non-industry-
specific export subsidies.\3\ Id. In addition, Petitioners made 
currency conversions, where necessary, based on the POI-average rupee/
U.S. dollar exchange rate, as reported on the Department's web site. 
See Vol. II of the Petition, at Exhibit II-5. Petitioners determined 
labor costs using the labor consumption, in hours, derived from the 
Surrogate Domestic Producer's experience. See Vol. II of the Petition, 
at 12 and Exhibit II-4-C-1. Petitioners valued labor costs using the 
Department's NME Wage Rate for the PRC at http://ia.ita.doc.gov/wages/07wages/final/final-2009-2007-wages.html. Id. For purposes of 
initiation, the Department determines that the surrogate values used by 
Petitioners are reasonably available and, thus, acceptable for purposes 
of initiation.
---------------------------------------------------------------------------

    \2\ Petitioners also provided NV calculations based on their 
purchase price for tool joints. Id; see also Checklist for more 
discussion on these calculations, as well as the ``Fair-Value 
Comparison'' section below.
    \3\ We adjusted Petitioners' data to exclude the inflators used 
to inflate the contemporaneous GTA data.
---------------------------------------------------------------------------

    Petitioners determined electricity costs using the electricity 
consumption, in kilowatt hours, derived from the Surrogate Domestic 
Producer's experience. See Vol. II of the Petition, at 11-12 and 
Exhibit II-4-C-1; see also Supplement to the AD/CVD Petitions at 3 and 
Exhibit 3. Petitioners valued electricity using the Indian electricity 
rate reported by the Central Electric Authority of the Government of 
India. See Vol. II of the Petition, at 11-12 and Exhibit II-4-C-2.
    Petitioners did not identify packing materials used in preparing 
finished drill pipe. Consequently, Petitioners did not include packing 
materials in its calculation of normal value. See Second Supplement to 
the AD/CVD Petitions at 5.
    Petitioners based factory overhead, selling, general and 
administrative, and profit on data from Oil Country Tubular Ltd., a 
producer of similar merchandise, for the 2008 - 2009 fiscal year. See 
Vol. II of the Petition, at 12 and Exhibit II- 4-D-1.

Fair-Value Comparisons

    Based on the data provided by Petitioners, there is reason to 
believe that imports of drill pipe from the PRC are being, or are 
likely to be, sold in the United States at less than fair value. Based 
on a comparison of U.S. prices and NV calculated in accordance with 
section 773(c) of the Act, the estimated dumping margins for drill pipe 
from the PRC, using GTA values for all inputs, range from 429.53 
percent to 496.93 percent. See Checklist and Second Supplement to the 
AD/CVD Petitions at Exhibit 5. In addition, Petitioners provided 
estimated dumping margins using POI average-unit values for imports of 
PRC-origin drill pipe into the United States, and Petitioners' own cost 
data for tool joints. See Checklist at 10.

Initiation of Antidumping Investigation

    Based upon the examination of the Petition on drill pipe from the 
PRC, the Department finds the Petition meets the requirements of 
section 732 of the Act. Therefore, we are initiating an antidumping 
duty investigation to determine whether imports of drill pipe from the 
PRC are being, or are likely to be, sold in the United States at less 
than fair value. In accordance with section 733(b)(1)(A) of the Act and 
19 CFR 351.205(b)(1), unless postponed, we will make our preliminary 
determinations no later than 140 days after the date of this 
initiation.

Targeted-Dumping Allegations

    On December 10, 2008, the Department issued an interim final rule 
for the purpose of withdrawing 19 CFR 351.414(f) and (g), the 
regulatory provisions governing the targeted- dumping analysis in 
antidumping duty investigations, and the corresponding regulation 
governing the deadline for targeted-dumping allegations, 19 CFR 
351.301(d)(5). See Withdrawal of the Regulatory Provisions Governing 
Targeted Dumping in Antidumping Duty Investigations, 73 FR 74930 
(December 10, 2008). The Department stated that ``withdrawal will allow 
the Department to exercise the discretion intended by the statute and, 
thereby, develop a practice that will allow interested parties to 
pursue all statutory avenues of relief in this area.'' Id. at 74931.
    In order to accomplish this objective, if any interested party 
wishes to make a targeted- dumping allegation in either of these 
investigations pursuant to section 777A(d)(1)(B) of the Act, such 
allegations are due no later than 45 days before the scheduled date of 
the preliminary determination.

Respondent Selection

    For this investigation, the Department will request quantity and 
value information from known exporters and producers identified with 
complete contact information in the Petition. The quantity and value 
data received from NME exporters/producers will be used as the basis to 
select the mandatory respondents.
    The Department requires that the respondents submit a response to 
both the quantity and value questionnaire and the separate-rate 
application by the respective deadlines in order to receive 
consideration for separate-rate status. See Circular Welded Austenitic 
Stainless Pressure Pipe from the People's Republic of China: Initiation 
of Antidumping Duty Investigation, 73 FR 10221, 10225 (February 26, 
2008); Initiation of Antidumping Duty Investigation: Certain Artist 
Canvas From the People's Republic of China, 70 FR 21996, 21999 (April 
28, 2005). On the date of the publication of this initiation notice in 
the Federal Register, the Department will post the quantity and value 
questionnaire along with the filing instructions on the Import 
Administration web site at http://ia.ita.doc.gov/ia-highlights-and-news.html, and a response to the quantity and value questionnaire is 
due no later than February 11, 2010. Also, the Department will send the 
quantity and value questionnaire to those PRC companies identified in 
the Petition at Exhibit I-7 and in the Second Supplement to the AD/CVD 
Petitions at Exhibit 4.
    Interested parties must submit applications for disclosure under 
APO in accordance with 19 CFR 351.305. Instructions for filing such 
applications may be found on the Department's web site at http://ia.ita.doc.gov/apo.

Separate Rates Application

    In order to obtain separate-rate status in NME investigations, 
exporters and producers must submit a separate-rate status application. 
See Policy Bulletin 05.1: Separate-Rates Practice and Application of 
Combination Rates in Antidumping Investigations involving Non-Market 
Economy Countries, dated April 5, 2005 (``Policy Bulletin''), available 
on the Department's web site at http://ia.ita.doc.gov/policy/bull05-

[[Page 4535]]

1.pdf. Based on our experience in processing the separate-rate 
applications in previous antidumping duty investigations, we have 
modified the application for this investigation to make it more 
administrable and easier for applicants to complete. See, e.g., 
Initiation of Antidumping Duty Investigation: Certain New Pneumatic 
Off-the-Road Tires From the People's Republic of China, 72 FR 43591, 
43594-95 (August 6, 2007). The specific requirements for submitting the 
separate-rate application in this investigation are outlined in detail 
in the application itself, which will be available on the Department's 
web site at http://ia.ita.doc.gov/ia-highlights-and-news.html on the 
date of publication of this initiation notice in the Federal Register. 
The separate-rate application will be due 60 days after publication of 
this initiation notice. For exporters and producers who submit a 
separate-rate status application and subsequently are selected as 
mandatory respondents, these exporters and producers will no longer be 
eligible for consideration for separate rate status unless they respond 
to all parts of the questionnaire as mandatory respondents. As noted in 
the ``Respondent Selection'' section above, the Department requires 
that respondents submit a response to both the quantity and value 
questionnaire and the separate rate application by the respective 
deadlines in order to receive consideration for separate-rate status.

Use of Combination Rates in an NME Investigation

    The Department will calculate combination rates for certain 
respondents that are eligible for a separate rate in this 
investigation. The Policy Bulletin states:
    {W{time} hile continuing the practice of assigning separate rates 
only to exporters, all separate rates that the Department will now 
assign in its NME investigations will be specific to those producers 
that supplied the exporter during the period of investigation. Note, 
however, that one rate is calculated for the exporter and all of the 
producers which supplied subject merchandise to it during the period of 
investigation. This practice applies both to mandatory respondents 
receiving an individually calculated separate rate as well as the pool 
of non-investigated firms receiving the weighted-average of the 
individually calculated rates. This practice is referred to as the 
application of ``combination rates'' because such rates apply to 
specific combinations of exporters and one or more producers. The cash-
deposit rate assigned to an exporter will apply only to merchandise 
both exported by the firm in question and produced by a firm that 
supplied the exporter during the period of investigation.
See Policy Bulletin at 6 (emphasis added).

Distribution of Copies of the Petition

    In accordance with section 732(b)(3)(A) of the Act and 19 CFR 
351.202(f), copies of the public versions of the Petition have been 
provided to the representatives of the Government of the PRC. Because 
of the large number of producers/exporters identified in the Petition, 
the Department considers the service of the public version of the 
Petition to the foreign producers/exporters satisfied by the delivery 
of the public version to the Government of the PRC, consistent with 19 
CFR 351.203(c)(2).

ITC Notification

    We have notified the ITC of our initiations, as required by section 
732(d) of the Act.

Preliminary Determinations by the ITC

    The ITC will preliminarily determine, no later than February 16, 
2010, whether there is a reasonable indication that imports of drill 
pipe from the PRC are materially injuring, or threatening material 
injury to a U.S. industry. A negative ITC determination will result in 
the investigation being terminated; otherwise, this investigation will 
proceed according to statutory and regulatory time limits.
    This notice is issued and published pursuant to section 777(i) of 
the Act.

    Dated January 20, 2010.
Ronald K. Lorentzen,
Deputy Assistant Secretary for Import Administration.

Appendix I

Scope of the Investigation

    The products covered by the investigation are steel drill pipe, and 
steel drill collars, whether or not conforming to American Petroleum 
Institute (API) or non-API specifications, whether finished or 
unfinished (including green tubes suitable for drill pipe), without 
regard to the specific chemistry of the steel (i.e., carbon, stainless 
steel, or other alloy steel), and without regard to length or outer 
diameter. The scope does not include tool joints not attached to the 
drill pipe, nor does it include unfinished tubes for casing or tubing 
covered by any other antidumping or countervailing duty order.
    The subject products are currently classified in the following 
Harmonized Tariff Schedule of the United States (HTSUS) categories: 
7304.22.0030, 7304.22.0045, 7304.22.0060, 7304.23.3000, 7304.23.6030, 
7304.23.6045, 7304.23.6060, 8431.43.8040 and may also enter under 
8431.43.8060, 8431.43.4000, 7304.39.0028, 7304.39.0032, 7304.39.0036, 
7304.39.0040, 7304.39.0044, 7304.39.0048, 7304.39.0052, 7304.39.0056, 
7304.49.0015, 7304.49.0060, 7304.59.8020, 7304.59.8025, 7304.59.8030, 
7304.59.8035, 7304.59.8040, 7304.59.8045, 7304.59.8050, and 
7304.59.8055.\4\
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    \4\ Prior to February 2, 2007, these imports entered under 
different tariff classifications, including 7304.21.3000, 
7304.21.6030, 7304.21.6045, and 7304.21.6060.
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    While HTSUS subheadings are provided for convenience and Customs 
purposes, the written description of the scope of the investigation is 
dispositive.
[FR Doc. 2010-1795 Filed 1-27-10; 8:45 am]
BILLING CODE 3510-DS-S