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Notice of Amended Final Determination of Sales at Less Than Fair Value: Silicon Metal From the Russian Federation

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AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

ACTION:

Notice of amended final determination in the less-than-fair-value investigation of silicon metal from the Russian Federation.

EFFECTIVE DATE:

March 13, 2003.

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FOR FURTHER INFORMATION CONTACT:

Cheryl Werner, AD/CVD Enforcement Group III, Office IX, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW., Washington, DC 20230; telephone: (202) 482-2667.

Scope of Investigation

For purposes of this investigation, the product covered is silicon metal, which generally contains at least 96.00 percent but less than 99.99 percent silicon by weight. The merchandise covered by this investigation also includes silicon metal from Russia containing between 89.00 and 96.00 percent silicon by weight, but containing more aluminum than the silicon metal which contains at least 96.00 percent but less than 99.99 percent silicon by weight. Silicon metal currently is classifiable under subheadings 2804.69.10 and 2804.69.50 of the Harmonized Tariff Schedule of the United States (“HTSUS”). This investigation covers all silicon metal meeting the above specification, regardless of tariff classification.

Amendment of Final Results

On February 11, 2003, the Department of Commerce (“the Department”) published a notice of final determination of sales at less than fair value in the investigation of silicon metal from the Russian Federation (“Russia”). Notice of Final Determination of Sales at Less Than Fair Value: Silicon Metal From the Russian Federation, 68 FR 6885 (February 11, 2003) (“Final Determination”).

Also on February 11, 2003, petitioners timely filed an allegation that the Department made ministerial errors in the Final Determination, pursuant to 19 CFR 351.224(c). Bratsk Aluminum Smelter (“BAS”) and (“RTL”) submitted timely rebuttal comments on February 19, 2003, in reply to the petitioners' ministerial error allegations. BAS and RTL did not submit any ministerial error allegations. ZAO Kremny (“Kremny”)/Sual-Kremny-Ural Ltd. (“SKU”) and Pultwen, the other respondent covered by the investigation, did not submit any ministerial error allegations or rebuttal comments in reply to petitioners' ministerial error allegations.

Silicon Metal Fines

Petitioners contend that in its Final Determination, the Department used overstated production quantities of silicon metal in calculating factor usage rates. Petitioners argue that while the Department included fines in the total production quantities of silicon metal on the basis that silicon metal fines produced by BAS and Kremny/SKU (collectively “respondents”) were similar in size, chemical composition, and price to commercial grade silicon metal, and the Department also concluded that the quantities of fines used in the calculation represented only sales of fines. Petitioners contend that the production quantities of fines reported by respondents and used by the Department included fines that were recycled and consumed in the production of silicon metal in addition of the fines that were sold. Petitioners claim this overstated the total production quantities used to calculate respondents' factor usage rates, and therefore, resulted in understated factor usage rates.

Petitioners contend that the record shows that both respondents consumed recycled silicon metal fines in the production of silicon metal during the POI. Petitioners explain that the production quantities of fines reported by respondents are larger than the total quantities of fines sold by respondents during the POI. According to petitioners, Kremny/SKU and Pultwen's August 13, 2002, response shows that they reported a quantity of fines recycled during the POI, which were then included in their production quantity. See Kremny/SKU and Pultwen's August 13, 2002, response, at 13. Petitioners also contend that the Department verified that only a portion of BAS's total fine production quantity was sold. See BAS Verification Report, at Exhibit 5.

Thus, petitioners argue the Department intended to include only the quantity of silicon metal fines sold by respondents in the total production quantity but erroneously included recycled fines as well. Petitioners explain that to correct this error, the Department should (1) subtract the Start Printed Page 12038quantities of fines that were recycled and consumed in the production from the total quantities of fines included in the total production quantities and (2) recalculate respondents' factor usage rates using the reduced production quantities. Petitioners explain that the volume of fines recycled by BAS during the POI is not in the record of this investigation, and therefore, as facts available, the Department should subtract the volume of fines sold that was verified from the total quantity of fines produced during the POI. Alternatively, petitioners also suggest that the Department could estimate the volume of fines recycled by BAS using the percentage amount of fines recycled by Kremny in relation to its total output.

BAS and RTL contend that the Department determined in its Final Determination that 0-5 mm silicon metal, or fines, should be included in the production quantity because “excluding fines from the production quantity used to calculate the reported factors would overstate the factors of production.” See Issues and Decision Memorandum, at Comment 11. BAS and RTL argue that the Department noted: That fines were within the scope of this investigation; that it verified that BAS made sales of fines; and that these sales were not made at a very substantial discount compared to normal-sized silicon metal. See id. Thus, BAS and RTL argue that the Department determined that fines produced by BAS were commercial-grade silicon metal. Accordingly, BAS and RTL explain that pursuant to Silicon Metal from Brazil, the Department properly determined that production costs should be allocated to fines produced by BAS.

BAS and RTL also contend that recycled fines were not included in the reported production quantities for BAS, which is demonstrated by the record. BAS and RTL explain that production documents show a small amount of material added to prevent the molten metal from sticking to the slab, but this amount was not included in BAS's reported total production quantity.

Department's Position

We disagree with petitioners.

Petitioners' request that the Department exclude recycled fines from the production quantity is not ministerial in nature, but rather involves a methodological change. This is because if the Department were to remove recycled fines from the total production quantity of silicon metal, we would not be allocating any costs to their production. Therefore, we would, in effect, be treating recycled fines as byproducts because the Department does not allocate costs to byproducts. This would be contrary to the Department's decision in the Final Determination. See Issues and Decision Memorandum, at Comment 11. A ministerial error is defined under 19 CFR 351.224(f) as “an error in addition, subtraction, or other arithmetic function, clerical error resulting from inaccurate copying, duplication, or the like, and any other similar type of unintentional error which the Secretary considers ministerial.” Petitioners' request, however, would require the Department to revisit its entire methodology for recognizing fines. Accordingly, we have not made the requested change, because it is not “ministerial” in nature.

Indirect Labor

Petitioners contend that the Department did not include indirect labor in the calculation of normal value for BAS in its Final Determination. Petitioners argue that the Department indicated that it intended to include both direct labor and indirect labor in the calculation of normal value for BAS, according to the BAS and RTL Final Analysis Memorandum. See Analysis Memorandum of Bratsk Aluminum Smelter and Rual Trade Limited: Final Determination in the Less Than Fair Value Investigation of Silicon Metal from the Russian Federation, at page 5 (February 3, 2003) (“BAS and RTL Final Analysis Memo”) (under the Normal Value calculation heading: “TOT_LABOR = DIRLAB_F + INDLAB_F”). Petitioners explain that it is necessary to include indirect labor in the calculation of normal value because the surrogate-valued amount for factory overhead used by the Department does not include any amount for indirect labor. Petitioners explain that the computer program used by the Department to calculate the final margin for BAS does not include indirect labor in the calculation of normal value. Petitioners contend that the Department should include indirect labor in the calculation of normal value for BAS.

BAS and RTL contend that petitioners have identified a methodological issue regarding how to account for labor costs not directly related to production of subject merchandise under a non-market economy methodology, rather than an arithmetic or duplication error that is appropriate to address as a ministerial error. BAS and RTL explain that BAS reported, as indirect labor, the per-unit hours of personnel involved in the maintenance and servicing (e.g., cleaning, catering) of the production facilities, and involved in the handling of transportation of raw materials and finished goods. BAS and RTL note that BAS included an allocated amount for the hours of executives, managers, and specialists who are involved indirectly in the production of silicon metal, in its reported direct labor. BAS and RTL contend that the labor cost of such personnel is normally classified as factory overhead or selling, general and administrative expenses under standard accounting principles. Accordingly, because the Department values factory overhead and general and administrative expenses using the financial statements of a surrogate company, under the non-market economy methodology, it is not necessary to include an amount for indirect labor in the Department's margin calculation, because this would double-count these labor expenses. Therefore, because BAS's reported direct labor already includes allocated amounts for indirect labor, and because indirect labor is also included in the surrogate financial information used in the margin calculation, the Department should not include additional labor hours in its margin calculation.

Department's Position

We agree with petitioners. We inadvertently excluded indirect labor in the calculation of normal value for BAS in the Final Determination. As BAS explained above, its reported indirect labor consists of the per-unit hours of personnel involved in the maintenance and servicing (e.g., cleaning, catering) of the production facilities, and involved in the handling of transportation of raw materials and finished goods, and is properly classified as indirect labor. Therefore, we revised our Final Determination, to include BAS's reported indirect labor in BAS's margin program calculation.

Wood Charcoal Freight Cost

Petitioners argue that the Department incorrectly calculated the wood charcoal freight cost for BAS in its Final Determination. Petitioners argue that the Department calculated the wrong weighted-average distance between BAS and wood charcoal suppliers. Petitioners contend that the Department should correct its wood charcoal freight cost calculation.

BAS and RTL agree with petitioners that the Department miscalculated the weighted-average distance of BAS's wood charcoal suppliers. However, BAS and RTL disagree with petitioners' calculation of the per-unit freight cost for wood charcoal, and propose their own calculation of the per-unit freight cost for wood charcoal. Start Printed Page 12039

Department's Position

We agree with petitioners and BAS and RTL, that we incorrectly calculated the weighted-average distance between BAS and wood charcoal suppliers. In the Final Determination, we inadvertently excluded certain suppliers of wood charcoal for BAS. We revised our Final Determination, to include the correct per-unit freight cost for wood charcoal in BAS's margin program calculation.

Therefore, we are amending the Final Determination to reflect the correction of the above-cited ministerial errors. All changes made to the margin program can be found in the analysis memorandum. See Memorandum to the File from Cheryl Werner, Case Analyst to James C. Doyle, Program Manager, Final Analysis for BAS for the Amended Final Determination of the Antidumping Duty Investigation of Silicon Metal from the Russian Federation, dated March 6, 2003.

The weighted-average dumping margins are as follows:

Producer/manufacturer exporterFinal weighted-average margin (percent)Amended final weighted average margin (percent)
Bratsk Aluminum Smelter77.5179.42
ZAO Kremny/Sual-Kremny-Ural Ltd54.7956.11

Consequently, we are issuing and publishing this amended final determination and notice in accordance with section 751(a)(1) of the Act.

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Dated: March 6, 2003.

Joseph A. Spetrini,

Acting Assistant Secretary for Import Administration.

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[FR Doc. 03-6089 Filed 3-12-03; 8:45 am]

BILLING CODE 3510-DS-P