Forged Steel Fluid End Blocks From the People's Republic of China: Final Affirmative Countervailing Duty Determination, 80020-80022 [2020-27330]
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80020
Federal Register / Vol. 85, No. 239 / Friday, December 11, 2020 / Notices
A fluid end block may be imported in
finished condition (i.e., ready for
incorporation into a pump fluid end
assembly without further finishing
operations) or unfinished condition (i.e.,
forged but still requiring one or more
finishing operations before it is ready for
incorporation into a pump fluid end
assembly). Such finishing operations may
include: (1) Heat treating; (2) milling one or
more flat surfaces; (3) contour machining to
custom shapes or dimensions; (4) drilling or
boring holes; (5) threading holes; and/or (6)
painting, varnishing, or coating.
Excluded from the scope of this
investigation are fluid end block assemblies
which (1) include (a) plungers and related
housings, adapters, gaskets, seals, and
packing nuts, (b) valves and related seats,
springs, seals, and cover nuts, and (c) a
discharge flange and related seals, and (2) are
otherwise ready to be mated with the ‘‘power
end’’ of a hydraulic pump without the need
for installation of any plunger, valve, or
discharge flange components, or any other
further manufacturing operations.
The products included in the scope of this
investigation may enter under Harmonized
Tariff Schedule of the United States (HTSUS)
subheadings 7218.91.0030, 7218.99.0030,
7224.90.0015, 7224.90.0045, 7326.19.0010,
7326.90.8688, or 8413.91.9055. While these
HTSUS subheadings are provided for
convenience and customs purposes, the
written description of the scope of the
investigation is dispositive.
jbell on DSKJLSW7X2PROD with NOTICES
Appendix II—List of Topics Discussed
in the Issues and Decision
Memorandum
I. Summary
II. Background
III. Changes from the Preliminary
Determination
IV. Discussion of the Issues
V. Comment 1: Zeroing
Comment 2: Differential Pricing Analysis
Comment 3: Particular Market Situation
Allegations
1. Cost-Based Allegations
a. Electricity Costs
b. Ferrochrome Costs
c. Natural Gas
2. Price-Based Allegations
a. Cartel Presence in Germany/Ongoing
Price-Fixing Investigation
b. Scrap and Alloy Surcharges
c. Physical Differences in the Products
Comment 4: Calculation of Constructed
Value Profit
Comment 5: Whether Adverse Facts
Available (AFA) is Appropriate for BGH
Edelstahl Siegen GmbH (BGH)
Comment 6: Whether to Use BGH’s
Submitted Sales and Cost Data
Comment 7: Application of AFA to
Schmiedewerke Groditz GmbH (SWG)
Comment 8: Selection of Appropriate AFA
Rate for SWG
V. Recommendation
[FR Doc. 2020–27331 Filed 12–10–20; 8:45 am]
BILLING CODE 3510–DS–P
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DEPARTMENT OF COMMERCE
International Trade Administration
[C–570–116]
Forged Steel Fluid End Blocks From
the People’s Republic of China: Final
Affirmative Countervailing Duty
Determination
Enforcement and Compliance,
International Trade Administration,
Department of Commerce.
SUMMARY: The Department of Commerce
(Commerce) determines that
countervailable subsidies are being
provided to producers and exporters of
forged steel fluid end blocks (fluid end
blocks) from the People’s Republic of
China (China).
DATES: Applicable December 11, 2020.
FOR FURTHER INFORMATION CONTACT:
Jaron Moore or Janae Martin, AD/CVD
Operations, Office VIII, Enforcement
and Compliance, International Trade
Administration, U.S. Department of
Commerce, 1401 Constitution Avenue
NW, Washington, DC 20230; telephone:
(202) 482–3640 or (202) 482–0238,
respectively.
AGENCY:
SUPPLEMENTARY INFORMATION:
Background
On May 26, 2020, Commerce
published the Preliminary
Determination of this countervailing
duty (CVD) investigation, which also
aligned the final determination of this
CVD investigation with the final
determination of the concurrent
antidumping duty (AD) investigation.1
A summary of the events that occurred
since Commerce published the
Preliminary Determination, as well as a
full discussion of the issues raised by
parties for this final determination, may
be found in the Issues and Decision
Memorandum which is hereby adopted
by this notice.2 The Issues and Decision
Memorandum is a public document and
is on file electronically via Enforcement
and Compliance’s Antidumping and
Countervailing Duty Centralized
Electronic Service System (ACCESS).
ACCESS is available to registered users
at https://access.trade.gov. In addition, a
1 See
Forged Steel Fluid End Blocks from the
People’s Republic of China: Preliminary Affirmative
Countervailing Duty Determination, and Alignment
of Final Determination With Final Antidumping
Duty Determination, 85 FR 31457 (May 26, 2020)
(Preliminary Determination).
2 See Memorandum, ‘‘Issues and Decision
Memorandum for the Final Affirmative
Determination of the Countervailing Duty
Investigation of Forged Steel Fluid End Blocks from
the People’s Republic of China,’’ dated concurrently
with, and hereby adopted by, this notice (Issues and
Decision Memorandum).
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complete version of the Final Decision
Memorandum can be accessed directly
at https://enforcement.trade.gov/frn/.
The signed and electronic versions of
the Issues and Decision Memorandum
are identical in content.
Period of Investigation
The period of investigation is January
1, 2018 through December 31, 2018.
Scope of the Investigation
The products covered by this
investigation are fluid end blocks from
China. For a complete description of the
scope of this investigation, see
Appendix I.
Scope Comments
During the course of this
investigation, Commerce received scope
comments from interested parties.
Commerce issued a Preliminary Scope
Decision Memorandum to address these
comments.3 We received comments
from interested parties on the
Preliminary Scope Memorandum,
which we address in the Final Scope
Decision Memorandum, dated
concurrently with, and hereby adopted
by, this final determination.4 Commerce
is not modifying the scope language as
it appeared in the Preliminary
Determination. See Appendix I for the
final scope of the investigation.
Analysis of Subsidy Programs and
Comments Received
The subsidy programs under
investigation and the issues raised in
the case and rebuttal briefs by parties in
this investigation are discussed in the
Issues and Decision Memorandum. A
list of the issues raised by parties is
attached to this notice at Appendix II.
Methodology
Commerce conducted this
investigation in accordance with section
701 of the Tariff Act of 1930, as
amended (the Act). For each of the
subsidy programs found
countervailable, Commerce determines
that there is a subsidy, i.e., a financial
contribution by an ‘‘authority’’ that
gives rise to a benefit to the recipient,
and that the subsidy is specific.5 For a
3 See Memorandum to the File, ‘‘Forged Steel
Fluid End Blocks from the Federal Republic of
Germany, India, Italy, and the People’s Republic of
China: Scope Comments Decision Memorandum for
the Preliminary Determinations,’’ dated May 18,
2020 (Preliminary Scope Decision Memorandum).
4 See Memorandum, ‘‘Forged Steel Fluid End
Blocks from the Federal Republic of Germany,
India, Italy, and the People’s Republic of China:
Scope Comments Decision Memorandum for the
Final Determinations,’’ dated December 7, 2020
(Final Scope Decision Memorandum).
5 See sections 771(5)(B) and (D) of the Act
regarding financial contribution; section 771(5)(E)
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Federal Register / Vol. 85, No. 239 / Friday, December 11, 2020 / Notices
full description of the methodology
underlying our final determination, see
the Issues and Decision Memorandum.
In making this final determination,
Commerce relied, in part, on facts
available pursuant to section 776(a) of
the Act. Additionally, as discussed in
the Issues and Decision Memorandum,
because one or more respondents did
not act to the best of their ability in
responding to our requests for
information, we drew adverse
inferences, where appropriate, in
selecting from among the facts
otherwise available, pursuant to section
776(b) of the Act.6
Verification
Commerce normally verifies
information relied upon in making its
final determination, pursuant to section
782(i)(1) of the Tariff Act of 1930, as
amended (the Act). However, during the
course of this investigation, we were
unable to conduct on-site verification
due to travel restrictions.7 Consistent
with section 776(a)(2)(D) of the Act,
Commerce relied on the information
submitted on the record, which we used
in making our Preliminary
Determination and Post-Preliminary
Determination,8 as facts available in
making our final determination.
All-Others Rate
We continue to calculate the allothers rate using a weighted average of
the individual estimated subsidy rates
calculated for the examined respondents
(Shanghai Qinghe Machinery Co., Ltd.
and Nanjing Develop Advanced
Manufacturing Co., Ltd.) using each
company’s publicly-ranged data for the
value of their exports to the United
States of subject merchandise.9
Final Determination
jbell on DSKJLSW7X2PROD with NOTICES
Commerce determines that the
following estimated countervailable
subsidy rates exist:
of the Act regarding benefit; and section 771(5A) of
the Act regarding specificity.
6 See Issues and Decision Memorandum at ‘‘Use
of Facts Otherwise Available and Adverse
Inferences’’ section.
7 See Memorandum, ‘‘Cancellation of Verification
and Setting of Briefing Schedule,’’ dated October 5,
2020.
8 See Memorandum, ‘‘Post-Preliminary Analysis
of Countervailing Duty Investigation: Forged Steel
Fluid End Blocks from the People’s Republic of
China,’’ dated September 18, 2020 (PostPreliminary Determination).
9 See Preliminary Determination, 85 FR 31457;
see also Memorandum, ‘‘AFA Calculation
Memorandum for the Final Determination in the
Investigation of Forged Steel Fluid End Blocks from
the People’s Republic of China,’’ dated December 7,
2020.
10 Commerce has found the following company to
be cross-owned with Nanjing Develop Advanced
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Subsidy rate
ad valorem
(percent)
Company
Nanjing Develop Advanced
Manufacturing Co., Ltd 10 ..
Shanghai Qinghe Machinery
Co., Ltd 11 ..........................
China Machinery Industrial
Products Co., Ltd ..............
Anhui Tianyu Petroleum
Equipment Manufacturing
Co., Ltd .............................
CNCCC Sichuan Imp & Exp
Co., Ltd .............................
GE Petroleum Equipment
(Beijing) Co., Ltd ...............
Jiaxing Shenghe Petroleum
Machinery Co., Ltd ............
Ningbo Minmetals & Machinery Imp & Exp Co., Ltd .....
Qingdao RT G&M Co., Ltd ...
Shandong Fenghuang
Foundry Co., Ltd ...............
Shandongshengjin Ruite Energy Equipment Co., Ltd
(part of Shengli Oilfield
R&T Group) .......................
Shanghai Baisheng Precision
Machine .............................
Shanghai Boss Petroleum
Equipment .........................
Shanghai CP Petrochemical
and General Machinery
Co., Ltd .............................
Suzhou Douson Drilling &
Production Equipment Co.,
Ltd .....................................
Zhangjiagang Haiguo New
Energy Equipment Manufacturing Co., Ltd ..............
Anhui Yingliu
Electromechanical Co., Ltd
Daye Special Steel Co., Ltd,
(Citic Specific Steel Group)
Suzhou Fujie Machinery Co.,
Ltd., (Fujie Group) .............
All Others ..............................
16.80
19.88
12 337.07
........................
........................
........................
........................
........................
........................
........................
........................
........................
........................
........................
........................
........................
........................
........................
........................
13 19.52
Disclosure
Commerce intends to disclose to
interested parties the calculations and
analysis performed in this final
determination within five days of any
public announcement or, if there is no
public announcement, within five days
of the date of the publication of this
Manufacturing Co., Ltd.: Nanjing Develop Industrial
and Commercial Co., Ltd.
11 Commerce has found the following companies
to be cross-owned with Shanghai Qinghe
Machinery Co., Ltd.: Haimo Technologies Group
Corp. and Lanzhou Chenglin Oil Drilling
Equipment Co., Ltd.
12 For discussion of the calculation of this rate,
see Memorandum, ‘‘Countervailing Duty
Investigation of Forged Steel Fluid End Blocks from
the People’s Republic of China: Final Determination
Calculation of AFA Rate,’’ dated December 7, 2020.
13 For discussion of the calculation of this rate,
see Memorandum, ‘‘Countervailing Duty
Investigation of Forged Steel Fluid End Blocks from
the People’s Republic of China: Final Determination
Calculation of All-Other’s Rate,’’ dated December 7,
2020.
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80021
notice in proceeding in accordance with
19 CFR 351.224(b).
Continuation of Suspension of
Liquidation
As a result of our Preliminary
Determination and pursuant to sections
703(d)(1)(B) and (d)(2) of the Act, we
instructed U.S. Customs and Border
Protection (CBP) to suspend liquidation
of entries of subject merchandise as
described in the scope of the
investigation section entered, or
withdrawn from warehouse, for
consumption on May 26, 2020, the date
of publication of the Preliminary
Determination in the Federal Register.
In accordance with section 703(d) of the
Act, effective September 23, 2020, we
instructed CBP to discontinue the
suspension of liquidation of all entries
at that time, but to continue the
suspension of liquidation of all entries
between May 26, 2020 and September
22, 2020.
If the U.S. International Trade
Commission (ITC) issues a final
affirmative injury determination, we
will issue a CVD order and require a
cash deposit of estimated countervailing
duties for entries of subject merchandise
in the amounts indicated above, in
accordance with section 706(a) of the
Act. If the ITC determines that material
injury, or threat of material injury, does
not exist, this proceeding will be
terminated, and all estimated duties
deposited or securities posted as a result
of the suspension of liquidation will be
refunded or canceled.
ITC Notification
In accordance with section 705(d) of
the Act, Commerce will notify the ITC
of its final affirmative determination
that countervailable subsidies are being
provided to producers and exporters of
fluid end blocks from China. As
Commerce’s final determination is
affirmative, in accordance with section
705(b) of the Act, the ITC will
determine, within 45 days, whether the
domestic industry in the United States
is materially injured, or threatened with
material injury. In addition, we are
making available to the ITC all nonprivileged and nonproprietary
information related to this investigation.
We will allow the ITC access to all
privileged and business proprietary
information in our files, provided the
ITC confirms that it will not disclose
such information, either publicly or
under an administrative protective order
(APO), without the written consent of
the Assistant Secretary for Enforcement
and Compliance.
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Federal Register / Vol. 85, No. 239 / Friday, December 11, 2020 / Notices
Notification Regarding Administrative
Protective Orders
In the event that the ITC issues a final
negative injury determination, this
notice will serve as the only reminder
to parties subject to an APO of their
responsibility concerning the
destruction of proprietary information
disclosed under APO in accordance
with 19 CFR 351.305(a)(3). Timely
written notification of the return/
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 which is subject to
sanction.
Notification to Interested Parties
This determination is issued and
published pursuant to sections 705(d)
and 777(i) of the Act and 19 CFR
351.210(c).
Dated: December 7, 2020.
Jeffery I. Kessler,
Assistant Secretary for Enforcement and
Compliance.
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APPENDIX I
Scope of the Investigation
The products covered by this investigation
are forged steel fluid end blocks (fluid end
blocks), whether in finished or unfinished
form, and which are typically used in the
manufacture or service of hydraulic pumps.
The term ‘‘forged’’ is an industry term used
to describe the grain texture of steel resulting
from the application of localized compressive
force. Illustrative forging standards include,
but are not limited to, American Society for
Testing and Materials (ASTM) specifications
A668 and A788.
For purposes of this investigation, the term
‘‘steel’’ denotes metal containing the
following chemical elements, by weight: (i)
Iron greater than or equal to 60 percent; (ii)
nickel less than or equal to 8.5 percent; (iii)
copper less than or equal to 6 percent; (iv)
chromium greater than or equal to 0.4
percent, but less than or equal to 20 percent;
and (v) molybdenum greater than or equal to
0.15 percent, but less than or equal to 3
percent. Illustrative steel standards include,
but are not limited to, American Iron and
Steel Institute (AISI) or Society of
Automotive Engineers (SAE) grades 4130,
4135, 4140, 4320, 4330, 4340, 8630, 15–5,
17–4, F6NM, F22, F60, and XM25, as well as
modified varieties of these grades.
The products covered by this investigation
are: (1) Cut-to-length fluid end blocks with an
actual height (measured from its highest
point) of 8 inches (203.2 mm) to 40 inches
(1,016.0 mm), an actual width (measured
from its widest point) of 8 inches (203.2 mm)
to 40 inches (1,016.0 mm), and an actual
length (measured from its longest point) of 11
inches (279.4 mm) to 75 inches (1,905.0 mm);
and (2) strings of fluid end blocks with an
actual height (measured from its highest
point) of 8 inches (203.2 mm) to 40 inches
(1,016.0 mm), an actual width (measured
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from its widest point) of 8 inches (203.2 mm)
to 40 inches (1,016.0 mm), and an actual
length (measured from its longest point) up
to 360 inches (9,144.0 mm).
The products included in the scope of this
investigation have a tensile strength of at
least 70 KSI (measured in accordance with
ASTM A370) and a hardness of at least 140
HBW (measured in accordance with ASTM
E10).
A fluid end block may be imported in
finished condition (i.e., ready for
incorporation into a pump fluid end
assembly without further finishing
operations) or unfinished condition (i.e.,
forged but still requiring one or more
finishing operations before it is ready for
incorporation into a pump fluid end
assembly). Such finishing operations may
include: (1) Heat treating; (2) milling one or
more flat surfaces; (3) contour machining to
custom shapes or dimensions; (4) drilling or
boring holes; (5) threading holes; and/or (6)
painting, varnishing, or coating.
Excluded from the scope of this
investigation are fluid end block assemblies
which (1) include (a) plungers and related
housings, adapters, gaskets, seals, and
packing nuts, (b) valves and related seats,
springs, seals, and cover nuts, and (c) a
discharge flange and related seals, and (2) are
otherwise ready to be mated with the ‘‘power
end’’ of a hydraulic pump without the need
for installation of any plunger, valve, or
discharge flange components, or any other
further manufacturing operations.
The products included in the scope of this
investigation may enter under Harmonized
Tariff Schedule of the United States (HTSUS)
subheadings 7218.91.0030, 7218.99.0030,
7224.90.0015, 7224.90.0045, 7326.19.0010,
7326.90.8688, or 8413.91.9055. While these
HTSUS subheadings are provided for
convenience and customs purposes, the
written description of the scope of the
investigation is dispositive.
APPENDIX II
List of Topics Discussed in the Issues and
Decision Memorandum
I. Summary
II. Background
III. Use of Facts Otherwise Available and
Adverse Inferences
IV. Subsidies Valuation
V. Analysis of Programs
VI. Analysis of Comments
Comment 1: Whether To Continue
Applying Adverse Facts Available (AFA)
to the Export Buyer’s Credit (EBC)
Program
Comment 2: Whether the Provision of
Electricity Is Countervailable
Comment 3: Whether Commerce Should
Revise the Electricity Benchmark
Comment 4: Whether to Revise the Import
Duty Rate in the Benchmark
Comment 5: Whether Commerce Should
Use Haimo’s Unconsolidated Sales Value
for Its Denominator
Comment 6: Whether Commerce Should
Include Other Revenue in the Sales
Values of Qinghe and Lanzhou Chenglin
Comment 7: Whether Commerce Correctly
Calculated Qinghe’s Benefit under the
Income Tax Deduction for Research and
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Development (R&D) Expenses Under the
Enterprise Income Tax Law
Comment 8: Calculation of Qinghe’s Other
Subsidies Benefits
VII. Recommendation
[FR Doc. 2020–27330 Filed 12–10–20; 8:45 am]
BILLING CODE 3510–DS–P
DEPARTMENT OF COMMERCE
International Trade Administration
[C–475–841]
Forged Steel Fluid End Blocks from
Italy: Final Affirmative Countervailing
Duty Determination
Enforcement and Compliance,
International Trade Administration,
Department of Commerce.
SUMMARY: The Department of Commerce
(Commerce) determines that
countervailable subsidies are being
provided to producers and exporters of
forged steel fluid end blocks (fluid end
blocks) from Italy.
DATES: Applicable December 11, 2020.
FOR FURTHER INFORMATION CONTACT:
Nicholas Czajkowski or Konrad
Ptaszynski, AD/CVD Operations, Office
I, Enforcement and Compliance,
International Trade Administration,
U.S. Department of Commerce, 1401
Constitution Avenue NW, Washington,
DC 20230; telephone: (202) 482–1395 or
(202) 482–6187, respectively.
SUPPLEMENTARY INFORMATION:
AGENCY:
Background
On May 26, 2020, Commerce
published the Preliminary
Determination of this countervailing
duty (CVD) investigation, which also
aligned the final determination of this
CVD investigation with the final
determination in the companion
antidumping duty investigation of fluid
end blocks from Italy.1
A summary of the events that
occurred since Commerce published the
Preliminary Determination, as well as a
full discussion of the issues raised by
parties for this final determination, may
be found in the Issues and Decision
Memorandum which is hereby adopted
by this notice.2 The Issues and Decision
Memorandum is a public document and
1 See Forged Steel Fluid End Blocks from Italy:
Preliminary Affirmative Countervailing Duty
Determination, and Alignment of Final
Determination with Final Antidumping Duty
Determination, 85 FR 31460 (May 26, 2020)
(Preliminary Determination).
2 See Memorandum, ‘‘Issues and Decision
Memorandum for the Final Determination in the
Countervailing Duty Investigation of Fluid End
Blocks from Italy,’’ dated concurrently with, and
hereby adopted by, this notice (Issues and Decision
Memorandum).
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]]>Agencies
[Federal Register Volume 85, Number 239 (Friday, December 11, 2020)]
[Notices]
[Pages 80020-80022]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-27330]
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DEPARTMENT OF COMMERCE
International Trade Administration
[C-570-116]
Forged Steel Fluid End Blocks From the People's Republic of
China: Final Affirmative Countervailing Duty Determination
AGENCY: Enforcement and Compliance, International Trade Administration,
Department of Commerce.
SUMMARY: The Department of Commerce (Commerce) determines that
countervailable subsidies are being provided to producers and exporters
of forged steel fluid end blocks (fluid end blocks) from the People's
Republic of China (China).
DATES: Applicable December 11, 2020.
FOR FURTHER INFORMATION CONTACT: Jaron Moore or Janae Martin, AD/CVD
Operations, Office VIII, Enforcement and Compliance, International
Trade Administration, U.S. Department of Commerce, 1401 Constitution
Avenue NW, Washington, DC 20230; telephone: (202) 482-3640 or (202)
482-0238, respectively.
SUPPLEMENTARY INFORMATION:
Background
On May 26, 2020, Commerce published the Preliminary Determination
of this countervailing duty (CVD) investigation, which also aligned the
final determination of this CVD investigation with the final
determination of the concurrent antidumping duty (AD) investigation.\1\
A summary of the events that occurred since Commerce published the
Preliminary Determination, as well as a full discussion of the issues
raised by parties for this final determination, may be found in the
Issues and Decision Memorandum which is hereby adopted by this
notice.\2\ The Issues and Decision Memorandum is a public document and
is on file electronically via Enforcement and Compliance's Antidumping
and Countervailing Duty Centralized Electronic Service System (ACCESS).
ACCESS is available to registered users at https://access.trade.gov. In
addition, a complete version of the Final Decision Memorandum can be
accessed directly at https://enforcement.trade.gov/frn/. The signed and
electronic versions of the Issues and Decision Memorandum are identical
in content.
---------------------------------------------------------------------------
\1\ See Forged Steel Fluid End Blocks from the People's Republic
of China: Preliminary Affirmative Countervailing Duty Determination,
and Alignment of Final Determination With Final Antidumping Duty
Determination, 85 FR 31457 (May 26, 2020) (Preliminary
Determination).
\2\ See Memorandum, ``Issues and Decision Memorandum for the
Final Affirmative Determination of the Countervailing Duty
Investigation of Forged Steel Fluid End Blocks from the People's
Republic of China,'' dated concurrently with, and hereby adopted by,
this notice (Issues and Decision Memorandum).
---------------------------------------------------------------------------
Period of Investigation
The period of investigation is January 1, 2018 through December 31,
2018.
Scope of the Investigation
The products covered by this investigation are fluid end blocks
from China. For a complete description of the scope of this
investigation, see Appendix I.
Scope Comments
During the course of this investigation, Commerce received scope
comments from interested parties. Commerce issued a Preliminary Scope
Decision Memorandum to address these comments.\3\ We received comments
from interested parties on the Preliminary Scope Memorandum, which we
address in the Final Scope Decision Memorandum, dated concurrently
with, and hereby adopted by, this final determination.\4\ Commerce is
not modifying the scope language as it appeared in the Preliminary
Determination. See Appendix I for the final scope of the investigation.
---------------------------------------------------------------------------
\3\ See Memorandum to the File, ``Forged Steel Fluid End Blocks
from the Federal Republic of Germany, India, Italy, and the People's
Republic of China: Scope Comments Decision Memorandum for the
Preliminary Determinations,'' dated May 18, 2020 (Preliminary Scope
Decision Memorandum).
\4\ See Memorandum, ``Forged Steel Fluid End Blocks from the
Federal Republic of Germany, India, Italy, and the People's Republic
of China: Scope Comments Decision Memorandum for the Final
Determinations,'' dated December 7, 2020 (Final Scope Decision
Memorandum).
---------------------------------------------------------------------------
Analysis of Subsidy Programs and Comments Received
The subsidy programs under investigation and the issues raised in
the case and rebuttal briefs by parties in this investigation are
discussed in the Issues and Decision Memorandum. A list of the issues
raised by parties is attached to this notice at Appendix II.
Methodology
Commerce conducted this investigation in accordance with section
701 of the Tariff Act of 1930, as amended (the Act). For each of the
subsidy programs found countervailable, Commerce determines that there
is a subsidy, i.e., a financial contribution by an ``authority'' that
gives rise to a benefit to the recipient, and that the subsidy is
specific.\5\ For a
[[Page 80021]]
full description of the methodology underlying our final determination,
see the Issues and Decision Memorandum.
---------------------------------------------------------------------------
\5\ See sections 771(5)(B) and (D) of the Act regarding
financial contribution; section 771(5)(E) of the Act regarding
benefit; and section 771(5A) of the Act regarding specificity.
---------------------------------------------------------------------------
In making this final determination, Commerce relied, in part, on
facts available pursuant to section 776(a) of the Act. Additionally, as
discussed in the Issues and Decision Memorandum, because one or more
respondents did not act to the best of their ability in responding to
our requests for information, we drew adverse inferences, where
appropriate, in selecting from among the facts otherwise available,
pursuant to section 776(b) of the Act.\6\
---------------------------------------------------------------------------
\6\ See Issues and Decision Memorandum at ``Use of Facts
Otherwise Available and Adverse Inferences'' section.
---------------------------------------------------------------------------
Verification
Commerce normally verifies information relied upon in making its
final determination, pursuant to section 782(i)(1) of the Tariff Act of
1930, as amended (the Act). However, during the course of this
investigation, we were unable to conduct on-site verification due to
travel restrictions.\7\ Consistent with section 776(a)(2)(D) of the
Act, Commerce relied on the information submitted on the record, which
we used in making our Preliminary Determination and Post-Preliminary
Determination,\8\ as facts available in making our final determination.
---------------------------------------------------------------------------
\7\ See Memorandum, ``Cancellation of Verification and Setting
of Briefing Schedule,'' dated October 5, 2020.
\8\ See Memorandum, ``Post-Preliminary Analysis of
Countervailing Duty Investigation: Forged Steel Fluid End Blocks
from the People's Republic of China,'' dated September 18, 2020
(Post-Preliminary Determination).
---------------------------------------------------------------------------
All-Others Rate
We continue to calculate the all-others rate using a weighted
average of the individual estimated subsidy rates calculated for the
examined respondents (Shanghai Qinghe Machinery Co., Ltd. and Nanjing
Develop Advanced Manufacturing Co., Ltd.) using each company's
publicly-ranged data for the value of their exports to the United
States of subject merchandise.\9\
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\9\ See Preliminary Determination, 85 FR 31457; see also
Memorandum, ``AFA Calculation Memorandum for the Final Determination
in the Investigation of Forged Steel Fluid End Blocks from the
People's Republic of China,'' dated December 7, 2020.
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Final Determination
Commerce determines that the following estimated countervailable
subsidy rates exist:
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\10\ Commerce has found the following company to be cross-owned
with Nanjing Develop Advanced Manufacturing Co., Ltd.: Nanjing
Develop Industrial and Commercial Co., Ltd.
\11\ Commerce has found the following companies to be cross-
owned with Shanghai Qinghe Machinery Co., Ltd.: Haimo Technologies
Group Corp. and Lanzhou Chenglin Oil Drilling Equipment Co., Ltd.
\12\ For discussion of the calculation of this rate, see
Memorandum, ``Countervailing Duty Investigation of Forged Steel
Fluid End Blocks from the People's Republic of China: Final
Determination Calculation of AFA Rate,'' dated December 7, 2020.
\13\ For discussion of the calculation of this rate, see
Memorandum, ``Countervailing Duty Investigation of Forged Steel
Fluid End Blocks from the People's Republic of China: Final
Determination Calculation of All-Other's Rate,'' dated December 7,
2020.
------------------------------------------------------------------------
Subsidy rate
Company ad valorem
(percent)
------------------------------------------------------------------------
Nanjing Develop Advanced Manufacturing Co., Ltd \10\.... 16.80
Shanghai Qinghe Machinery Co., Ltd \11\................. 19.88
China Machinery Industrial Products Co., Ltd............ \12\ 337.07
Anhui Tianyu Petroleum Equipment Manufacturing Co., Ltd. ..............
CNCCC Sichuan Imp & Exp Co., Ltd........................ ..............
GE Petroleum Equipment (Beijing) Co., Ltd............... ..............
Jiaxing Shenghe Petroleum Machinery Co., Ltd............ ..............
Ningbo Minmetals & Machinery Imp & Exp Co., Ltd......... ..............
Qingdao RT G&M Co., Ltd................................. ..............
Shandong Fenghuang Foundry Co., Ltd..................... ..............
Shandongshengjin Ruite Energy Equipment Co., Ltd (part ..............
of Shengli Oilfield R&T Group).........................
Shanghai Baisheng Precision Machine..................... ..............
Shanghai Boss Petroleum Equipment....................... ..............
Shanghai CP Petrochemical and General Machinery Co., Ltd ..............
Suzhou Douson Drilling & Production Equipment Co., Ltd.. ..............
Zhangjiagang Haiguo New Energy Equipment Manufacturing ..............
Co., Ltd...............................................
Anhui Yingliu Electromechanical Co., Ltd................ ..............
Daye Special Steel Co., Ltd, (Citic Specific Steel ..............
Group).................................................
Suzhou Fujie Machinery Co., Ltd., (Fujie Group)......... ..............
All Others.............................................. \13\ 19.52
------------------------------------------------------------------------
Disclosure
Commerce intends to disclose to interested parties the calculations
and analysis performed in this final determination within five days of
any public announcement or, if there is no public announcement, within
five days of the date of the publication of this notice in proceeding
in accordance with 19 CFR 351.224(b).
Continuation of Suspension of Liquidation
As a result of our Preliminary Determination and pursuant to
sections 703(d)(1)(B) and (d)(2) of the Act, we instructed U.S. Customs
and Border Protection (CBP) to suspend liquidation of entries of
subject merchandise as described in the scope of the investigation
section entered, or withdrawn from warehouse, for consumption on May
26, 2020, the date of publication of the Preliminary Determination in
the Federal Register. In accordance with section 703(d) of the Act,
effective September 23, 2020, we instructed CBP to discontinue the
suspension of liquidation of all entries at that time, but to continue
the suspension of liquidation of all entries between May 26, 2020 and
September 22, 2020.
If the U.S. International Trade Commission (ITC) issues a final
affirmative injury determination, we will issue a CVD order and require
a cash deposit of estimated countervailing duties for entries of
subject merchandise in the amounts indicated above, in accordance with
section 706(a) of the Act. If the ITC determines that material injury,
or threat of material injury, does not exist, this proceeding will be
terminated, and all estimated duties deposited or securities posted as
a result of the suspension of liquidation will be refunded or canceled.
ITC Notification
In accordance with section 705(d) of the Act, Commerce will notify
the ITC of its final affirmative determination that countervailable
subsidies are being provided to producers and exporters of fluid end
blocks from China. As Commerce's final determination is affirmative, in
accordance with section 705(b) of the Act, the ITC will determine,
within 45 days, whether the domestic industry in the United States is
materially injured, or threatened with material injury. In addition, we
are making available to the ITC all non-privileged and nonproprietary
information related to this investigation. We will allow the ITC access
to all privileged and business proprietary information in our files,
provided the ITC confirms that it will not disclose such information,
either publicly or under an administrative protective order (APO),
without the written consent of the Assistant Secretary for Enforcement
and Compliance.
[[Page 80022]]
Notification Regarding Administrative Protective Orders
In the event that the ITC issues a final negative injury
determination, this notice will serve as the only reminder to parties
subject to an APO of their responsibility concerning the destruction of
proprietary information disclosed under APO in accordance with 19 CFR
351.305(a)(3). Timely written notification of the return/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 which is subject to sanction.
Notification to Interested Parties
This determination is issued and published pursuant to sections
705(d) and 777(i) of the Act and 19 CFR 351.210(c).
Dated: December 7, 2020.
Jeffery I. Kessler,
Assistant Secretary for Enforcement and Compliance.
APPENDIX I
Scope of the Investigation
The products covered by this investigation are forged steel
fluid end blocks (fluid end blocks), whether in finished or
unfinished form, and which are typically used in the manufacture or
service of hydraulic pumps.
The term ``forged'' is an industry term used to describe the
grain texture of steel resulting from the application of localized
compressive force. Illustrative forging standards include, but are
not limited to, American Society for Testing and Materials (ASTM)
specifications A668 and A788.
For purposes of this investigation, the term ``steel'' denotes
metal containing the following chemical elements, by weight: (i)
Iron greater than or equal to 60 percent; (ii) nickel less than or
equal to 8.5 percent; (iii) copper less than or equal to 6 percent;
(iv) chromium greater than or equal to 0.4 percent, but less than or
equal to 20 percent; and (v) molybdenum greater than or equal to
0.15 percent, but less than or equal to 3 percent. Illustrative
steel standards include, but are not limited to, American Iron and
Steel Institute (AISI) or Society of Automotive Engineers (SAE)
grades 4130, 4135, 4140, 4320, 4330, 4340, 8630, 15-5, 17-4, F6NM,
F22, F60, and XM25, as well as modified varieties of these grades.
The products covered by this investigation are: (1) Cut-to-
length fluid end blocks with an actual height (measured from its
highest point) of 8 inches (203.2 mm) to 40 inches (1,016.0 mm), an
actual width (measured from its widest point) of 8 inches (203.2 mm)
to 40 inches (1,016.0 mm), and an actual length (measured from its
longest point) of 11 inches (279.4 mm) to 75 inches (1,905.0 mm);
and (2) strings of fluid end blocks with an actual height (measured
from its highest point) of 8 inches (203.2 mm) to 40 inches (1,016.0
mm), an actual width (measured from its widest point) of 8 inches
(203.2 mm) to 40 inches (1,016.0 mm), and an actual length (measured
from its longest point) up to 360 inches (9,144.0 mm).
The products included in the scope of this investigation have a
tensile strength of at least 70 KSI (measured in accordance with
ASTM A370) and a hardness of at least 140 HBW (measured in
accordance with ASTM E10).
A fluid end block may be imported in finished condition (i.e.,
ready for incorporation into a pump fluid end assembly without
further finishing operations) or unfinished condition (i.e., forged
but still requiring one or more finishing operations before it is
ready for incorporation into a pump fluid end assembly). Such
finishing operations may include: (1) Heat treating; (2) milling one
or more flat surfaces; (3) contour machining to custom shapes or
dimensions; (4) drilling or boring holes; (5) threading holes; and/
or (6) painting, varnishing, or coating.
Excluded from the scope of this investigation are fluid end
block assemblies which (1) include (a) plungers and related
housings, adapters, gaskets, seals, and packing nuts, (b) valves and
related seats, springs, seals, and cover nuts, and (c) a discharge
flange and related seals, and (2) are otherwise ready to be mated
with the ``power end'' of a hydraulic pump without the need for
installation of any plunger, valve, or discharge flange components,
or any other further manufacturing operations.
The products included in the scope of this investigation may
enter under Harmonized Tariff Schedule of the United States (HTSUS)
subheadings 7218.91.0030, 7218.99.0030, 7224.90.0015, 7224.90.0045,
7326.19.0010, 7326.90.8688, or 8413.91.9055. While these HTSUS
subheadings are provided for convenience and customs purposes, the
written description of the scope of the investigation is
dispositive.
APPENDIX II
List of Topics Discussed in the Issues and Decision Memorandum
I. Summary
II. Background
III. Use of Facts Otherwise Available and Adverse Inferences
IV. Subsidies Valuation
V. Analysis of Programs
VI. Analysis of Comments
Comment 1: Whether To Continue Applying Adverse Facts Available
(AFA) to the Export Buyer's Credit (EBC) Program
Comment 2: Whether the Provision of Electricity Is
Countervailable
Comment 3: Whether Commerce Should Revise the Electricity
Benchmark
Comment 4: Whether to Revise the Import Duty Rate in the
Benchmark
Comment 5: Whether Commerce Should Use Haimo's Unconsolidated
Sales Value for Its Denominator
Comment 6: Whether Commerce Should Include Other Revenue in the
Sales Values of Qinghe and Lanzhou Chenglin
Comment 7: Whether Commerce Correctly Calculated Qinghe's
Benefit under the Income Tax Deduction for Research and Development
(R&D) Expenses Under the Enterprise Income Tax Law
Comment 8: Calculation of Qinghe's Other Subsidies Benefits
VII. Recommendation
[FR Doc. 2020-27330 Filed 12-10-20; 8:45 am]
BILLING CODE 3510-DS-P
