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Stainless Steel Sheet and Strip in Coils From the Republic of Korea; Final Results and Partial Rescission of Antidumping Duty Administrative Review

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AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

ACTION:

Notice of final results and partial rescission of antidumping duty administrative review of stainless steel sheet and strip in coils from the Republic of Korea.

SUMMARY:

On August 7, 2002, the Department of Commerce (“the Department”) published in the Federal Register the preliminary results and partial rescission of its administrative review of the antidumping duty order on stainless steel sheet and strip in coils from the Republic of Korea (67 FR 51216). This review covers imports of subject merchandise from Pohang Iron & Steel Co., Ltd. (“POSCO”), Samwon Precision Metals Co., Ltd. (“Samwon”) and Daiyang Metal Co., Ltd. (“DMC”). The period of review (“POR”) is July 1, 2000 through June 30, 2001.

Based on our analysis of the comments received, we have made changes in the margin calculations for POSCO and DMC. Therefore, the final results differ from the preliminary results of review. The final weighted-average dumping margins for the reviewed firms are listed below in the section entitled “Final Results of the Review.” In addition, we are rescinding the administrative review with respect to Samwon.

EFFECTIVE DATE:

February 10, 2003.

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FOR FURTHER INFORMATION CONTACT:

Laurel LaCivita (“POSCO”) and (“Samwon”) or Lilit Astvatsatrian (“DMC”), Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, N.W., Washington, D.C. 20230; telephone: (202) 482-4243 or (202) 482-6412, respectively.

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SUPPLEMENTARY INFORMATION:

Background

On August 7, 2002, the Department published Notice of Preliminary Results and Partial Rescission of Antidumping Duty Administrative Review for Stainless Steel Sheet and Strip in Coils From the Republic of Korea, 67 FR 51216 (August 7, 2002) (“Preliminary Results”). As we stated in that notice, we preliminarily rescinded this review with respect to Samwon, pursuant to its claim of no shipments of the subject merchandise during the POR. We are now rescinding this administrative review with respect to Samwon, since there is no information on the record that indicates that Samwon made any shipments during the POR.

We invited parties to comment on these preliminary results. We received written comments on September 6, 2002 Start Printed Page 6714from petitioners,1 POSCO and DMC. On September 16, 2002, we received rebuttal comments from petitioners, POSCO and DMC. We have now completed the administrative review in accordance with section 751 of the Tariff Act of 1930, as amended (“the Act”).

Under section 751(a)(3)(A) of the Act, the Department may extend the deadline for completion of an administrative review if it determines that it is not practicable to complete the review within the statutory time limit. On December 9, 2002, the Department extended the time limit for the final results in this review to February 3, 2003. See Stainless Steel Sheet and Strip in Coils From the Republic of Korea: Extension of Final Results of Antidumping Duty Administrative Review, 67 FR 72917 (December 9, 2002).

Scope of the Review

For purposes of this administrative review, the products covered are certain stainless steel sheet and strip in coils. Stainless steel is an alloy steel containing, by weight, 1.2 percent or less of carbon and 10.5 percent or more of chromium, with or without other elements. The subject sheet and strip is a flat-rolled product in coils that is greater than 9.5 mm in width and less than 4.75 mm in thickness, and that is annealed or otherwise heat treated and pickled or otherwise descaled. The subject sheet and strip may also be further processed (e.g., cold-rolled, polished, aluminized, coated, etc.) provided that it maintains the specific dimensions of sheet and strip following such processing.

The merchandise subject to this review is classified in the Harmonized Tariff Schedule of the United States (HTS) at subheadings: 7219.13.0031, 7219.13.0051, 7219.13.0071, 7219.1300.812, 7219.14.0030, 7219.14.0065, 7219.14.0090, 7219.32.0005, 7219.32.0020, 7219.32.0025, 7219.32.0035, 7219.32.0036, 7219.32.0038, 7219.32.0042, 7219.32.0044, 7219.33.0005, 7219.33.0020, 7219.33.0025, 7219.33.0035, 7219.33.0036, 7219.33.0038, 7219.33.0042, 7219.33.0044, 7219.34.0005, 7219.34.0020, 7219.34.0025, 7219.34.0030, 7219.34.0035, 7219.35.0005, 7219.35.0015, 7219.35.0030, 7219.35.0035, 7219.90.0010, 7219.90.0020, 7219.90.0025, 7219.90.0060, 7219.90.0080, 7220.12.1000, 7220.12.5000, 7220.20.1010, 7220.20.1015, 7220.20.1060, 7220.20.1080, 7220.20.6005, 7220.20.6010, 7220.20.6015, 7220.20.6060, 7220.20.6080, 7220.20.7005, 7220.20.7010, 7220.20.7015, 7220.20.7060, 7220.20.7080, 7220.20.8000, 7220.20.9030, 7220.20.9060, 7220.90.0010, 7220.90.0015, 7220.90.0060, and 7220.90.0080. Although the HTS subheadings are provided for convenience and Customs purposes, the Department's written description of the merchandise under review is dispositive.

Excluded from the scope of this review are the following: (1) sheet and strip that is not annealed or otherwise heat treated and pickled or otherwise descaled, (2) sheet and strip that is cut to length, (3) plate (i.e., flat-rolled stainless steel products of a thickness of 4.75 mm or more), (4) flat wire (i.e., cold-rolled sections, with a prepared edge, rectangular in shape, of a width of not more than 9.5 mm), and (5) razor blade steel. Razor blade steel is a flat-rolled product of stainless steel, not further worked than cold-rolled (cold-reduced), in coils, of a width of not more than 23 mm and a thickness of 0.266 mm or less, containing, by weight, 12.5 to 14.5 percent chromium, and certified at the time of entry to be used in the manufacture of razor blades. See Chapter 72 of the HTS, “Additional U.S. Note” 1(d).

In response to comments by interested parties, the Department has determined that certain specialty stainless steel products are also excluded from the scope of this review. These excluded products are described below.

Flapper valve steel is defined as stainless steel strip in coils containing, by weight, between 0.37 and 0.43 percent carbon, between 1.15 and 1.35 percent molybdenum, and between 0.20 and 0.80 percent manganese. This steel also contains, by weight, phosphorus of 0.025 percent or less, silicon of between 0.20 and 0.50 percent, and sulfur of 0.020 percent or less. The product is manufactured by means of vacuum arc remelting, with inclusion controls for sulphide of no more than 0.04 percent and for oxide of no more than 0.05 percent. Flapper valve steel has a tensile strength of between 210 and 300 ksi, yield strength of between 170 and 270 ksi, plus or minus 8 ksi, and a hardness (Hv) of between 460 and 590. Flapper valve steel is most commonly used to produce specialty flapper valves in compressors.

Also excluded is a product referred to as suspension foil, a specialty steel product used in the manufacture of suspension assemblies for computer disk drives. Suspension foil is described as 302/304 grade or 202 grade stainless steel of a thickness between 14 and 127 microns, with a thickness tolerance of plus-or-minus 2.01 microns, and surface glossiness of 200 to 700 percent Gs. Suspension foil must be supplied in coil widths of not more than 407 mm, and with a mass of 225 kg or less. Roll marks may only be visible on one side, with no scratches of measurable depth. The material must exhibit residual stresses of 2 mm maximum deflection, and flatness of 1.6 mm over 685 mm length.

Certain stainless steel foil for automotive catalytic converters is also excluded from the scope of this review. This stainless steel strip in coils is a specialty foil with a thickness of between 20 and 110 microns used to produce a metallic substrate with a honeycomb structure for use in automotive catalytic converters. The steel contains, by weight, carbon of no more than 0.030 percent, silicon of no more than 1.0 percent, manganese of no more than 1.0 percent, chromium of between 19 and 22 percent, aluminum of no less than 5.0 percent, phosphorus of no more than 0.045 percent, sulfur of no more than 0.03 percent, lanthanum of less than 0.002 or greater than 0.05 percent, and total rare earth elements of more than 0.06 percent, with the balance iron.

Permanent magnet iron-chromium-cobalt alloy stainless strip is also excluded from the scope of this review. This ductile stainless steel strip contains, by weight, 26 to 30 percent chromium, and 7 to 10 percent cobalt, with the remainder of iron, in widths 228.6 mm or less, and a thickness between 0.127 and 1.270 mm. It exhibits magnetic remanence between 9,000 and 12,000 gauss, and a coercivity of between 50 and 300 oersteds. This product is most commonly used in electronic sensors and is currently available under proprietary trade names such as “Arnokrome III.”3

Certain electrical resistance alloy steel is also excluded from the scope of this review. This product is defined as a non-magnetic stainless steel manufactured to American Society of Testing and Materials (“ASTM”) specification B344 and containing, by Start Printed Page 6715weight, 36 percent nickel, 18 percent chromium, and 46 percent iron, and is most notable for its resistance to high temperature corrosion. It has a melting point of 1390 degrees Celsius and displays a creep rupture limit of 4 kilograms per square millimeter at 1000 degrees Celsius. This steel is most commonly used in the production of heating ribbons for circuit breakers and industrial furnaces, and in rheostats for railway locomotives. The product is currently available under proprietary trade names such as “Gilphy 36.”4

Certain martensitic precipitation-hardenable stainless steel is also excluded from the scope of this review. This high-strength, ductile stainless steel product is designated under the Unified Numbering System (“UNS”) as S45500-grade steel, and contains, by weight, 11 to 13 percent chromium, and 7 to 10 percent nickel. Carbon, manganese, silicon and molybdenum each comprise, by weight, 0.05 percent or less, with phosphorus and sulfur each comprising, by weight, 0.03 percent or less. This steel has copper, niobium, and titanium added to achieve aging, and will exhibit yield strengths as high as 1700 Mpa and ultimate tensile strengths as high as 1750 Mpa after aging, with elongation percentages of 3 percent or less in 50 mm. It is generally provided in thicknesses between 0.635 and 0.787 mm, and in widths of 25.4 mm. This product is most commonly used in the manufacture of television tubes and is currently available under proprietary trade names such as “Durphynox 17.”5

Finally, three specialty stainless steels typically used in certain industrial blades and surgical and medical instruments are also excluded from the scope of this review. These include stainless steel strip in coils used in the production of textile cutting tools (e.g., carpet knives).6 This steel is similar to AISI grade 420 but containing, by weight, 0.5 to 0.7 percent of molybdenum. The steel also contains, by weight, carbon of between 1.0 and 1.1 percent, sulfur of 0.020 percent or less, and includes between 0.20 and 0.30 percent copper and between 0.20 and 0.50 percent cobalt. This steel is sold under proprietary names such as “GIN4 Mo.” The second excluded stainless steel strip in coils is similar to AISI 420-J2 and contains, by weight, carbon of between 0.62 and 0.70 percent, silicon of between 0.20 and 0.50 percent, manganese of between 0.45 and 0.80 percent, phosphorus of no more than 0.025 percent and sulfur of no more than 0.020 percent. This steel has a carbide density on average of 100 carbide particles per 100 square microns. An example of this product is “GIN5” steel. The third specialty steel has a chemical composition similar to AISI 420 F, with carbon of between 0.37 and 0.43 percent, molybdenum of between 1.15 and 1.35 percent, but lower manganese of between 0.20 and 0.80 percent, phosphorus of no more than 0.025 percent, silicon of between 0.20 and 0.50 percent, and sulfur of no more than 0.020 percent. This product is supplied with a hardness of more than Hv 500 guaranteed after customer processing, and is supplied as, for example, “GIN6”7.

Rescission of Review

In the Preliminary Results, we stated that Samwon reported, and the Department confirmed through independent U.S. Customs Service data, that it had no shipments of subject merchandise during the POR. Since Samwon did not report any shipments during the POR, we had no basis for determining a margin. Consequently, in accordance with 19 CFR 351.213(d)(3) and consistent with the Department's practice, we preliminarily rescinded our review with respect to Samwon. Since we have received no information since the Preliminary Results that contradicts the decision made in the preliminary results of review, we are rescinding the administrative review with respect to Samwon. Since Samwon did not participate in the original investigation, its cash deposit rate will remain at 2.49 percent, which is the all others rate established in the less than fair value (“LTFV”) investigation.

Analysis of Comments Received

All issues raised in the case and rebuttal briefs by parties to this administrative review are addressed in the “Issues and Decision Memorandum” (“Decision Memorandum”) from Joseph A. Spetrini, Deputy Assistant Secretary, Import Administration, to Faryar Shirzad, Assistant Secretary for Import Administration, dated February 3, 2002, which is hereby adopted by this notice. A list of the issues which parties have raised and to which we have responded, all of which are in the Decision Memorandum, is attached to this notice as an Appendix. Parties can find a complete discussion of all issues raised in this review and the corresponding recommendations in this public memorandum which is on file in the Central Records Unit, Room B-099 of the main Department building. In addition, a complete version of the Decision Memorandum can be accessed directly on the Web at http://ia.ita.doc.gov/​. The paper copy and electronic version of the Decision Memorandum are identical in content.

Sales Below Cost

We disregarded sales below cost for both POSCO and DMC during the course of the review.

Changes Since the Preliminary Results

Based on our analysis of comments received, we have made changes in the margin calculations for POSCO and DMC. The changes to the margin calculations are listed below:

POSCO

  • We revised the calculation of indirect selling expenses (“ISEs”) in the United States to include housing income. See Comment 4.
  • We reclassified POSCO's income and loss with respect to money market funds as financing expenses and used the short-term income earned on monetary instruments to offset interest expense for the final results of review. See Comment 6.
  • We revised our calculation of general and administrative (“G&A”) expenses to associate POSCO's reversal of bad debt to both export and domestic sales. See Comment 7.
  • We revised the computer program to merge COP and constructed value (“CV”) files in the initial phases of the cost calculation in order to prepare data for those models sold exclusively in the United States for the assignation of the revised variable cost of manufacturing (“VCOM”) or total cost of manufacturing (“TCOM”). See Comment 10.
  • We revised the computer program to apply the L-grade adjustment to the variable cost of manufacturing (“VCOM”) and total cost of manufacturing (“TCOM”) used in determining the difference-in-merchandise adjustment for sales to the United States. See Comment 11.

DMC

  • We recalculated DMC's net interest expense in the home market using the actual amount of short-term interest income as an offset to interest expense. See Comment 12.
  • We revised our calculation of ISE in the U.S. market to offset OMC's interest expense by the imputed credit reported in the sales database. See Comment 13.
  • Start Printed Page 6716
  • We revised the calculation of net price in the United States to eliminate the double counting of billing adjustments. See Comment 14.

Final Results of Review

We determine that the following percentage margin exists for the reviewed companies during the period July 1, 2000 through June 30, 2001:

Stainless Steel Sheet and Strip in Coils from Korea

Manufacturer/exporter/­resellerMargin ­(percent)
POSCO0.98
DMC5.44

The Department shall determine, and Customs shall assess, antidumping duties on all appropriate entries. In accordance with 19 CFR 351.212(b)(1), we have calculated exporter/importer (or customer)-specific assessment rate for merchandise subject to this review. The Department will issue appraisement instructions directly to the Customs Service within 15 days of publication of these final results of review. We will direct the Customs Service to assess the resulting assessment rates against the entered customs values for the subject merchandise on each of that importer's entries during the review period. For customer's duty-assessment purposes, we will calculate importer-specific assessment rates by dividing the dumping margins calculated for each importer by the total entered value of sales for each importer during the period of review.

Cash Deposit Requirements

The following deposit requirements will be effective upon publication of this notice of final results of administrative review for all shipments of stainless steel sheet and strip in coils from the Republic of Korea entered, or withdrawn from warehouse, for consumption on or after the date of publication, as provided by section 751(a)(1) of the Act: (1) The cash deposit rates for POSCO and DMC will be the rates shown above; (2) for previously reviewed or investigated companies not listed above, the cash deposit rate will continue to be the company-specific rate published for the most recent period; (3) if the exporter is not a firm covered in this review, a prior review, or the original less-than-fair-value (LTFV) investigation, but the manufacturer is, the cash deposit rate will be the rate established for the most recent period for the manufacturer of the merchandise; and (4) if neither the exporter nor the manufacturer is a firm covered in these or any previous reviews conducted by the Department, the cash deposit rate will be the “all others” rate, which is 2.49 percent.

These deposit requirements shall remain in effect until publication of the final results of the next administrative review.

Notification of Interested Parties

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 or countervailing 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 the antidumping duties or countervailing duties occurred and the subsequent assessment of double antidumping duties or countervailing duties.

This notice also serves as a reminder to parties subject to administrative protective orders (“APOs”) 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/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.

We are issuing and publishing this determination and notice in accordance with sections 751(a)(1) and 771(i) of the Act.

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Dated: February 3, 2003.

Faryar Shirzad,

Assistant Secretary for Import Administration.

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Appendix 1—Issues in the Decision Memorandum

A. Issues with Respect to POSCO

Comment 1: ISE ratio in the United States

Comment 2: Imputed Credit Offset to Pohang Steel America's (“POSAM”) Interest Expense Incurred in the United States

Comment 3: Major Inputs From Affiliated Parties

Comment 4: Housing Expenses in the United States

Comment 5: Loss on Valuation of Inventory

Comment 6: Short-term Financial Income Earned on Monetary Instruments

Comment 7: Reversal of an Allowance for Bad Debt

Comment 8: Unrealized Income Derived from Long-Term Trade Receivables

Comment 9: Constructed Export Price (“CEP”) Offset on CEP Sales

Comment 10: Ministerial Errors in the Merging of the Cost Files

Comment 11: Ministerial Error in the Calculation of L-Grade Adjustment

B. Issues with Respect to DMC

Comment 12: Adjustment for DMC's Net Financial Expenses Ratio in the Home Market

Comment 13: Ocean Metal Corporation's (“OMC”) Interest Expense Offset with Imputed Credit Expenses in the United States

Comment 14: Deduction of Billing Adjustments from OMC's Gross Unit Price

Comment 15: Inclusion of All Home Market Sales in the CEP Profit Calculation

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Footnotes

1.  Allegheny Ludlum Corporation, AK Steel Corporation (formerly Armco, Inc.), J&L Specialty Steel, Inc., North American Stainless, Butler-Armco Independent Union, Zanesville Armco Independent Union, and the United Steelworkers of America, AFL-CIO/CLC.

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2.  Due to changes to the HTS numbers in 2001, 7219.13.0030, 7219.13.0050, 7219.13.0070, and 7219.13.0080 are now 7219.13.0031, 7219.13.0051, 7219.13.0071, and 7219.13.0081, respectively.

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3.  “Arnokrome III” is a trademark of the Arnold Engineering Company.

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4.  “Gilphy 36” is a trademark of Imphy, S.A.

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5.  “Durphynox 17” is a trademark of Imphy, S.A.

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6.  This list of uses is illustrative and provided for descriptive purposes only.

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7.  “GIN4 Mo,” “GIN5” and “GIN6” are the proprietary grades of Hitachi Metals America, Ltd.

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[FR Doc. 03-3283 Filed 2-7-03; 8:45 am]

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