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Certain Orange Juice from Brazil: Preliminary Results of Antidumping Duty Changed Circumstances Review and Intent Not to Revoke, In Part

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Information about this document as published in the Federal Register.

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AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

EFFECTIVE DATE:

October 10, 2008.

SUMMARY:

On April 29, 2008, the Department of Commerce (the Department) published a notice of initiation of a changed circumstances review of the antidumping duty order on certain orange juice from Brazil to consider partially revoking the order to exclude ultra low pulp orange juice (ULPOJ) pursuant to section 751(b)(1) of the Tariff Act of 1930, as amended (the Act), and 19 CFR 351.216(b) and 351.222(g)(1)(i). See Certain Orange Juice from Brazil: Initiation of Antidumping Duty Changed Circumstances Review, 73 FR 23182 (Apr. 29, 2008) (Initiation Notice). Upon analyzing the industry support information provided by the interested parties participating in this review, we preliminarily determine there is not sufficient industry support for the Department to partially revoke the order on certain orange juice from Brazil to exclude ULPOJ.

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FOR FURTHER INFORMATION CONTACT:

Elizabeth Eastwood or Henry Almond; AD/CVD Operations, Office 2, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue NW, Washington, DC 20230; telephone: (202) 482-3874 or (202) 482-0049, respectively.

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SUPPLEMENTARY INFORMATION:

Background

On March 9, 2006, the Department published in the Federal Register an antidumping duty order on certain orange juice from Brazil. See Antidumping Duty Order: Certain Orange Juice from Brazil, 72 FR 12183 (Mar. 9, 2006).

On June 14, 2007, Tropicana Products, Inc. (Tropicana) requested that the Department initiate a changed circumstances review to consider partially revoking the antidumping duty order on certain orange juice from Brazil to exclude ULPOJ. According to Tropicana, producers accounting for substantially all of the production of the domestic like product have no interest in maintaining the order on ULPOJ, and no domestic producer is capable of producing ULPOJ.

On July 24, 2007, we notified Tropicana that its June 14 request was insufficient for the Department to initiate a changed circumstances review, and we requested documentation from Tropicana regarding its industry support assertions and further information regarding the pulp content of ULPOJ. On January 31, 2008, Tropicana responded to the Department's request for information, providing: 1) letters of support from processors either supporting or not opposing Tropicana's request to exclude ULPOJ from the order; 2) a calculation of the level of industry support; and 3) documentation regarding the pulp content of ULPOJ.

On February 29, 2008, we received comments from Florida Citrus Mutual, A. Duda & Sons, Inc. (doing business as Citrus Belle), and Citrus World, Inc., all Start Printed Page 60242members of the domestic industry1, regarding Tropicana's request. These domestic producers (hereinafter referred to as “the petitioners”) asserted that the Department must consider the position of the entire domestic industry (i.e., both processors and growers) when determining the level of industry support, as was done for purposes of the initiation of this proceeding. According to the petitioners, when the growers are considered, there is an insufficient level of industry support necessary for the Department to partially revoke the order under 19 CFR 351.222(g)(1)(i). In addition, the petitioners note that, contrary to Tropicana's assertion, the U.S. domestic industry is capable of producing ULPOJ. Therefore, the petitioners urged the Department to reject Tropicana's request and not initiate this changed circumstances review.

On March 6, 2008, we requested additional information from Tropicana regarding an incomplete letter contained in its January 31 response. On March 10, 2008, Tropicana submitted the requested information.

On April 29, 2008, the Department published a notice of initiation of a changed circumstances review of the antidumping duty order on certain orange juice from Brazil to consider partially revoking the order to exclude ULPOJ. See Initiation Notice, 73 FR 23182.

On May 6, 2008, we requested additional information from Tropicana regarding the industry support for its partial revocation request, including the position of growers, as well as the position of domestic growers and processors outside of Florida. On May 27, 2008, Tropicana responded to this request with a revised calculation of industry support, including processors from states other than Florida, and it reiterated its position that growers should not be included in the Department's industry support calculation and that the domestic industry is incapable of producing ULPOJ.

On June 16, 2008, the petitioners submitted additional comments stating their position that growers should be included in the Department's industry support calculation and that the domestic industry is capable of producing ULPOJ.

On June 25, 2008, Tropicana submitted further information regarding a California orange juice processor's support for Tropicana's request for partial revocation, as well as a revised calculation of industry support including this processor, and on July 22, 2008, it submitted further comments.

On August 21, 2008, we requested additional information from the petitioners regarding their position on the partial revocation request and an industry support calculation reflecting their position. On September 4, 2008, the petitioners provided this information, stating their opposition to the partial revocation request along with an industry support calculation showing that the petitioners' opposition accounts for well over 15 percent of the domestic industry. On September 12, 2008, Tropicana submitted comments responding to this submission. On September 19, 2008, the petitioners submitted further comments.

Scope of the Order

The scope of this order includes certain orange juice for transport and/or further manufacturing, produced in two different forms: (1) frozen orange juice in a highly concentrated form, sometimes referred to as frozen concentrated orange juice for manufacture (FCOJM); and (2) pasteurized single-strength orange juice which has not been concentrated, referred to as not-from-concentrate (NFC). At the time of the filing of the petition, there was an existing antidumping duty order on frozen concentrated orange juice (FCOJ) from Brazil. See Antidumping Duty Order; Frozen Concentrated Orange Juice from Brazil, 52 FR 16426 (May 5, 1987). Therefore, the scope of this order with regard to FCOJM covers only FCOJM produced and/or exported by those companies which were excluded or revoked from the pre-existing antidumping order on FCOJ from Brazil as of December 27, 2004. Those companies are Cargill Citrus Limitada; Coinbra-Frutesp S.A.; Sucocitrico Cutrale, S.A.; Fischer S.A. Comercio, Industria and Agricutura; and Montecitrus Trading S.A.

Excluded from the scope of the order are reconstituted orange juice and frozen concentrated orange juice for retail (FCOJR). Reconstituted orange juice is produced through further manufacture of FCOJM, by adding water, oils and essences to the orange juice concentrate. FCOJR is concentrated orange juice, typically at 42 Brix, in a frozen state, packed in retail-sized containers ready for sale to consumers. FCOJR, a finished consumer product, is produced through further manufacture of FCOJM, a bulk manufacturer's product.

The subject merchandise is currently classifiable under subheadings 2009.11.00, 2009.12.25, 2009.12.45, and 2009.19.00 of the Harmonized Tariff Schedule of the United States (HTSUS). These HTSUS subheadings are provided for convenience and for customs purposes only and are not dispositive. Rather, the written description of the scope of the order is dispositive.

Scope of Changed Circumstances Review

The product subject to this changed circumstances review is ULPOJ, which is concentrated orange juice with a pulp content of two percent or less by weight/volume on an 11.8 degree brix equivalent base. This product is a form of FCOJM and is commonly used in the manufacture of soft drink concentrates.

Preliminary Results of Changed Circumstances Review

Pursuant to section 751(d) of the Act, the Department may revoke an antidumping duty order based on a review under section 751(b) of the Act. The Department's regulations at section 351.222(g)(1)(i) provide that the Department may revoke an order, in whole or in part, based on changed circumstances if “{p}roducers accounting for substantially all of the production of the domestic like product to which the order (or part of the order to be revoked) pertains have expressed a lack of interest in the order, in whole or in part.” In this context, the Department has interpreted “substantially all” production normally to mean at least 85 percent of domestic production of the like product. See e.g., Certain Corrosion-Resistant Carbon Steel Flat Products From Japan: Preliminary Results of Antidumping Duty Changed Circumstances Review and Intent Not to Revoke, In Part, 70 FR 35618, 35624 (June 21, 2005), unchanged in Certain Corrosion-Resistant Carbon Steel Flat Products From Japan: Final Results of Antidumping Duty Changed Circumstances Review and Determination Not to Revoke, In Part, 70 FR 47787 (Aug. 15, 2005).

In determining whether to initiate the less-than-fair-value (LTFV) investigation, the Department relied on section 771(4)(E) (i.e., the “agricultural provision”) of the Act to include growers of oranges as part of the relevant industry for purposes of evaluating industry support for the petition. See Notice of Initiation of Antidumping Investigation: Certain Orange Juice From Brazil, 70 FR 7233, Start Printed Page 602437234 (Feb. 11, 2005). Tropicana argues that, although growers were permissibly included in the calculation of industry support in the LTFV investigation under the agricultural provision, that provision does not apply to changed circumstances reviews. Thus, Tropicana argues that only orange juice processors should be included in the Department's calculations when determining whether “producers” making this request account for substantially all of the production of the domestic like product under 19 CFR 351.222(g)(1)(i). Moreover, Tropicana argues that to deny a revocation request, the Department normally requires producers accounting for at least 15 percent of domestic production to affirmatively demonstrate their opposition to revocation. See, e.g., Stainless Steel Sheet and Strip in Coils from Italy: Preliminary Results of Countervailing Duty Changed Circumstances Review and Intent to Revoke Order, 71 FR 7737, 7739 (Feb. 14, 2006); and Certain Corrosion-Resistant Carbon Steel Flat Products and Cut-to-Length Carbon Steel Plate Products From Germany: Preliminary Results of Countervailing Duty Changed Circumstances Reviews, 69 FR 4114, 4116 (Jan. 28, 2004).

We disagree with Tropicana that growers of oranges for processing into juice should be excluded from the Department's industry support calculation in this changed circumstances review. Under section 732(b)(1) of the Act, the Department must determine whether the petition is filed on behalf of the domestic industry at the time that it initiates an investigation. In order to determine whether the petition has been filed on behalf of the domestic industry, section 732(c)(4)(A) of the Act requires the Department to determine the proportion of the industry, in terms of production of the domestic like product, supporting the petition. Section 771(4)(A) of the Act defines the term “industry” as “the producers as a whole of a domestic like product, or those producers whose collective output of a domestic like product constitutes a major proportion of the total domestic production of the product.” Moreover, section 771(4)(E)(i) of the Act states “in an investigation involving a processed agricultural product produced from any raw agricultural product, the producers or growers of the raw agricultural product may be considered part of the industry producing the processed product.”

We find that the definition of the domestic industry from the LTFV investigation applies in subsequent segments of the proceeding.2 In the LTFV investigation, the Department “included growers of round oranges for processing as part of the industry producing the processed agricultural product.” See the October 6, 2008, memorandum to the file from Henry Almond, analyst, entitled, “Placing Information Regarding the LTFV Industry Support Calculation on the Record of the ULPOJ Changed Circumstances Review,” at page 10 (emphasis added) (LTFV Industry Support Memo). Similar to the determination required by section 732(c)(4)(A) of the Act, the Department's regulations require the Department to determine what proportion of the “production of the domestic like product” those producers expressing a lack of interest in the order, in whole or in part, represent. Thus, because growers of the oranges that are ultimately processed into juice are part of the industry producing the domestic like product, we find that they are “producers” for purposes of 19 CFR 351.222(g)(1)(i) and must be included in the Department's industry support calculation. Moreover, including these companies for industry support purposes when determining whether to initiate the LTFV investigation, but excluding them for purposes of a partial revocation, would create two mutually inconsistent definitions of the industry producing the domestic like product and would deny those petitioners the ability to maintain the order, in whole or in part. Although Tropicana has attempted to provide statutory support for its argument that the relevant industry for purposes of this changed circumstances review should not include the growers, these arguments are unpersuasive and do not justify creating two inconsistent definitions of the domestic industry.

Regarding Tropicana's claim that the domestic industry is incapable of producing ULPOJ and the petitioners' counterclaim that it can, we note that neither party has based any argument on this fact, nor explained why this is relevant to the Department's changed circumstances review. Moreover, the fact that the domestic industry does not produce a specific type or class of product covered under the scope of an antidumping duty order has no bearing on the scope of the order and is not grounds for partial revocation under 19 CFR 351.222. See, e.g., Notice of Final Determination of Sales at Less Than Fair Value: Certain Cold-Rolled Carbon Steel Flat Products From Argentina, 58 FR 37062 (July 9, 1993) (where the Department stated that “there is no requirement that interested parties manufacture every product within the like product designation, only that they are producers of a like product”). Accordingly, the Department finds that the domestic industry's ability to produce ULPOJ is not germane to these preliminary results.

In the LTFV investigation, the Department calculated industry support by giving equal weight to the juice output of the processors and the orange fruit input of the growers. See LTFV Industry Support Memo at 18-20. Under this methodology, well over 15 percent of the domestic industry has expressed an interest in maintaining the order on ULPOJ. See the petitioners' September 4, 2008, submission at Exhibit 1. Thus, Tropicana has not shown that producers accounting for substantially all of the production of the domestic like product have expressed a lack of interest in the order with respect to ULPOJ, as required by 19 CFR 351.222(g)(1)(i), and therefore, we preliminarily determine that there is insufficient evidence to warrant the revocation of ULPOJ from the scope of the order.

Notice of Intent Not To Revoke the Antidumping Duty Order, In Part

Under the definition of “substantially all,” as discussed above, over 15 percent of the domestic industry has expressed opposition to excluding ULPOJ from the antidumping duty order on certain orange juice from Brazil. As a result, we preliminarily determine that changed circumstances sufficient to warrant revocation in part of the antidumping duty order on certain orange juice from Brazil do not exist. The current requirements for the cash deposit of estimated antidumping duties on the subject merchandise will remain in effect until further notice.

Parties wishing to comment on these results must submit briefs to the Department within 30 days after the publication of this notice in the Federal Register. Parties will have five days subsequent to this due date to submit rebuttal briefs. Parties who submit comments or rebuttal briefs in this proceeding are requested to submit with the argument: (1) a statement of the issue, and (2) a brief summary of the argument (no longer than five pages, including footnotes). Any requests for hearing must be filed within 30 days of the publication of this notice in the Federal Register. In accordance with 19 CFR 351.216(e), the Department will Start Printed Page 60244issue its final results of review within 270 days after the date on which the changed circumstances review was initiated (i.e., no later than January 19, 2009).

We are issuing and publishing this notice in accordance with sections 751(b)(1) and 777(i)(1) of the Act and 19 CFR 351.216.

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Dated: October 6, 2008.

David M. Spooner,

Assistant Secretary for Import Administration.

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Footnotes

1.  These entities are also petitioners in this proceeding and are opposing this changed circumstances review; however, another petitioner, Southern Gardens Citrus Processing Corporation, has not joined these entities in opposing Tropicana's request.

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2.  We note that pursuant to section 732(c)(4)(E) of the Act, “{a}fter the administering authority makes a determination with respect to initiating an investigation, the determination regarding industry support shall not be reconsidered.”

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[FR Doc. E8-24205 Filed 10-9-08; 8:45 am]

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