Import Administration, International Trade Administration, Department of Commerce.
Effective Date: July 24, 2013.
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FOR FURTHER INFORMATION CONTACT:
Laurel LaCivita or Paul Stolz (India); Raquel Silva or Joy Zhang (Thailand) at (202) 482-4243, (202) 482-4474, (202) 482-6475, or (202) 482-1168, respectively, AD/CVD Operations, Office 8, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue NW., Washington, DC 20230.
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On June 27, 2013, the Department of Commerce (the “Department”) received antidumping duty (“AD”) petitions concerning imports of steel threaded rod from India and Thailand filed in proper form on behalf of All America Threaded Products Inc.; Bay Standard Manufacturing Inc.; and Vulcan Threaded Products Inc. (“Vulcan”) (collectively, “Petitioners”).
Petitioners are domestic producers of steel threaded rod. On July 2 and 3, 2013, the Department requested additional information and clarification of certain areas of the Petitions.
Petitioners filed Start Printed Page 44527responses to these requests on July 8 and 9, 2013.
In accordance with section 732(b) of the Tariff Act of 1930, as amended (the “Act”), Petitioners allege that imports of steel threaded rod from India and Thailand are being, or are likely to be, sold in the United States at less than fair value within the meaning of section 731 of the Act and that such imports are materially injuring, or threatening material injury to, an industry in the United States. Also, consistent with section 732(b)(1) of the Act, the Petitions are accompanied by information reasonably available to Petitioners supporting their allegations.
The Department finds that Petitioners filed these Petitions on behalf of the domestic industry because Petitioners are interested parties as defined in section 771(9)(C) of the Act. The Department also finds that Petitioners have demonstrated sufficient industry support with respect to the initiation of the AD investigations that Petitioners are requesting. See the “Determination of Industry Support for the Petitions” section below.
Period of Investigation
Because the Petitions were filed on June 27, 2013, the period of investigation (“POI”) for the India and Thailand investigations is April 1, 2012, through March 31, 2013.
Scope of the Investigations
The product covered by these investigations is steel threaded rod from India and Thailand. For a full description of the scope of the investigations, see the “Scope of the Investigations,” in the Appendix of this notice.
Comments on Scope of Investigations
During our review of the Petitions, we discussed the scope with Petitioners to ensure that it is an accurate reflection of the product for which the domestic industry is seeking relief. Moreover, as discussed in the preamble to the regulations,
we are setting aside a period for interested parties to raise issues regarding product coverage. The Department encourages all interested parties to submit such comments by 5:00 p.m. Eastern Daylight Time on Tuesday, August 6, 2013, which is 20 calendar days from the signature date of this notice.
All comments must be filed on the record of both the India and the Thailand AD investigations. All comments and submissions to the Department must be filed electronically using Import Administration's Antidumping Countervailing Duty Centralized Electronic Service System (“IA ACCESS”).
An electronically filed document must be received successfully in its entirety by the Department's electronic records system, IA ACCESS, by the time and date noted above. Documents excepted from the electronic submission requirements must be filed manually (i.e., in paper form) with Import Administration's APO/Dockets Unit, Room 1870, U.S. Department of Commerce, 14th Street and Constitution Avenue NW., Washington, DC 20230, and stamped with the date and time of receipt by the deadline noted above.
The period of scope comments is intended to provide the Department with ample opportunity to consider all comments and to consult with parties prior to the issuance of the preliminary determinations.
Comments on Product Characteristics for Antidumping Questionnaires
The Department requests comments from interested parties regarding the appropriate physical characteristics of steel threaded rod to be reported in response to the Department's AD questionnaires. This information will be used to identify the key physical characteristics of the subject merchandise in order to report the relevant factors and costs of production accurately as well as to develop appropriate product-comparison criteria.
Interested parties may provide any information or comments that they feel are relevant to the development of an accurate list of physical characteristics. Specifically, they may provide comments as to which characteristics are appropriate to use as: (1) General product characteristics and (2) product-comparison criteria. We note that it is not always appropriate to use all product characteristics as product-comparison criteria. We base product-comparison criteria on meaningful commercial differences among products. In other words, while there may be some physical product characteristics utilized by manufacturers to describe steel threaded rod, it may be that only a select few product characteristics take into account commercially meaningful physical characteristics. In addition, interested parties may comment on the order in which the physical characteristics should be used in matching products. Generally, the Department attempts to list the most important physical characteristics first and the least important characteristics last.
In order to consider the suggestions of interested parties in developing and issuing the AD questionnaires, we must receive comments on product characteristics by August 16, 2013. Rebuttal comments must be received by August 26, 2013. All comments and submissions to the Department must be filed electronically using IA ACCESS, as referenced above.
Determination of Industry Support for the Petitions
Section 732(b)(1) of the Act requires that a petition be filed on behalf of the domestic industry. Section 732(c)(4)(A) of the Act provides that a petition meets this requirement if the domestic producers or workers who support the petition account for: (i) at least 25 percent of the total production of the domestic like product; and (ii) more than 50 percent of the production of the domestic like product produced by that portion of the industry expressing support for, or opposition to, the petition. Moreover, section 732(c)(4)(D) of the Act provides that, if the petition does not establish support of domestic producers or workers accounting for more than 50 percent of the total production of the domestic like product, the Department shall: (i) poll the industry or rely on other information in order to determine if there is support for the petition, as required by subparagraph (A); or (ii) determine industry support using a statistically valid sampling method to poll the industry.Start Printed Page 44528
Section 771(4)(A) of the Act defines the “industry” as the producers as a whole of a domestic like product. Thus, to determine whether a petition has the requisite industry support, the statute directs the Department to look to producers and workers who produce the domestic like product. The U.S. International Trade Commission (“ITC”), which is responsible for determining whether “the domestic industry” has been injured, must also determine what constitutes a domestic like product in order to define the industry. While both the Department and the ITC must apply the same statutory definition regarding the domestic like product,
they do so for different purposes and pursuant to a separate and distinct authority. In addition, the Department's determination is subject to limitations of time and information. Although this may result in different definitions of the like product, such differences do not render the decision of either agency contrary to law.
Section 771(10) of the Act defines the domestic like product as “a product which is like, or in the absence of like, most similar in characteristics and uses with, the article subject to an investigation under this title.” Thus, the reference point from which the domestic like product analysis begins is “the article subject to an investigation” (i.e., the class or kind of merchandise to be investigated, which normally will be the scope as defined in the petition).
With regard to the domestic like product, Petitioners do not offer a definition of domestic like product distinct from the scope of the investigations. Based on our analysis of the information submitted on the record, we have determined that steel threaded rod constitutes a single domestic like product and we have analyzed industry support in terms of that domestic like product.
In determining whether Petitioners have standing under section 732(c)(4)(A) of the Act, we considered the industry support data contained in the Petitions with reference to the domestic like product as defined in the “Scope of Investigations” section above. To establish industry support, Petitioners provided their production of the domestic like product in 2012, and compared this to the estimated total production of the domestic like product for the entire domestic industry.
Petitioners estimated 2012 production of the domestic like product by non-petitioning companies based on their knowledge of the industry. We have relied upon data Petitioners provided for purposes of measuring industry support.
Based on information provided in the Petitions, supplemental submissions, and other information readily available to the Department, we determine that Petitioners have met the statutory criteria for industry support under section 732(c)(4)(A)(i) of the Act because the domestic producers (or workers) who support the Petitions account for at least 25 percent of the total production of the domestic like product.
Based on information provided in the Petitions and other submissions, the domestic producers (or workers) have met the statutory criteria for industry support under section 732(c)(4)(A)(ii) of the Act because the domestic producers (or workers) who support the Petitions account for more than 50 percent of the production of the domestic like product produced by that portion of the industry expressing support for, or opposition to, the Petitions. Accordingly, the Department determines that the Petitions were filed on behalf of the domestic industry within the meaning of section 732(b)(1) of the Act.
The Department finds that Petitioners filed the Petitions on behalf of the domestic industry because they are interested parties as defined in section 771(9)(C) of the Act and they have demonstrated sufficient industry support as required under section 732(c)(4)(A), with respect to the AD investigations that they are requesting the Department initiate.
Allegations and Evidence of Material Injury and Causation
Petitioners allege that the U.S. industry producing the domestic like product is being materially injured, or is threatened with material injury, by reason of the imports of the subject merchandise sold at less than normal value (“NV”). In addition, Petitioners allege that subject imports exceed the negligibility threshold provided for under section 771(24)(A) of the Act.
Petitioners contend that the industry's injured condition is illustrated by reduced market share; increased import penetration; underselling and price depression or suppression; lost sales and revenues; low capacity utilization; stagnant employment-related variables; and decline in financial performance.
We have assessed the allegations and supporting evidence regarding material injury, threat of material injury, and causation, and we have determined that these allegations are properly supported by adequate evidence and meet the statutory requirements for initiation.
Allegations of Sales at Less Than Fair Value
The following is a description of the allegations of sales at less-than-fair-value upon which the Department based its decision to initiate investigations of imports of steel threaded rod from India and Thailand. The sources of data for the deductions and adjustments relating to U.S. price and NV are discussed in greater detail in the India AD Initiation Checklist and the Thailand AD Initiation Checklist.
Petitioners calculated export price (“EP”) based on lost U.S. sales and offers for sale for major types of steel threaded rod for delivery to the U.S. customer during the POI. To derive the ex-factory price, Petitioners made deductions to U.S. price for domestic brokerage and handling, international freight, distributor markup, and discounts/rebates, as appropriate, based on the stated sales and delivery terms.
Petitioners estimated international freight and distributor markups based on their knowledge and experience. Petitioners calculated domestic brokerage and handling using 2012 average charges (inclusive of document fees, terminal handling and port Start Printed Page 44529charges, and customs clearance charges) for exports from India, as published in Doing Business in India by the World Bank. Petitioners calculated discounts/rebates based on the terms of an offer for sale.
Petitioners calculated EP based on lost U.S. sales and offers for sale for major types of steel threaded rod for delivery to the U.S. customer during the POI. Based on the stated sales and delivery terms, Petitioners deducted from the U.S. price domestic brokerage and handling, international freight, U.S. inland freight, and distributor mark-up, where appropriate.
Petitioners estimated international freight and U.S. inland freight based on their own knowledge and experience regarding shipments of full containers from Thailand to the West Coast and from a West Coast port to the buyer's location. Petitioners calculated domestic brokerage and handling using 2012 average charges (inclusive of document fees, terminal handling and port charges, and customs clearance charges) for exports from Thailand, as published in Doing Business in Thailand by the World Bank. Petitioners estimated distributor mark-up based on their knowledge and experience.
Petitioners provided home market prices for steel threaded rod in India. These prices were adjusted to exclude distributor mark-up, where appropriate.
Petitioners provided information demonstrating reasonable grounds to believe or suspect that sales of steel threaded rod in the Indian market were made at prices below the fully-absorbed cost of production (“COP”), within the meaning of section 773(b) of the Act, and requested that the Department conduct a country-wide sales-below-cost investigation. The Statement of Administrative Action (“SAA”) accompanying the Uruguay Round Agreements Act states that an allegation of sales below COP need not be specific to individual exporters or producers.
The SAA states that “Commerce will consider allegations of below-cost sales in the aggregate for a foreign country, just as Commerce currently considers allegations of sales at less than fair value on a country-wide basis for purposes of initiating an antidumping investigation.” 
Further, the SAA provides that section 773(b)(2)(A) of the Act retains the requirement that the Department have “reasonable grounds to believe or suspect” that below-cost sales have occurred before initiating such an investigation. Reasonable grounds exist when an interested party provides specific factual information on costs and prices, observed or constructed, indicating that sales in the foreign market in question are at below-cost prices.
Cost of Production
Pursuant to section 773(b)(3) of the Act, COP consists of the cost of manufacturing (“COM”); selling, general and administrative (“SG&A”) expenses; financial expenses; and packing expenses. Petitioners calculated COM (except factory overhead) and packing expenses based on the input quantities of Vulcan's Pelham facility adjusted for known differences, during the anticipated POI, multiplied by the value of the inputs used to manufacture threaded rod in India using publicly-available data. Petitioners used their actual tolling costs of zinc coating and hot-dip galvanization because Petitioners did not perform these processes in-house.
To determine factory overhead, SG&A, and financial expense rates, Petitioners relied on the fiscal year (“FY”) ended March 31, 2013 financial statements of an Indian producer of comparable merchandise.
Based upon a comparison of the prices of the foreign like product in the home market to the calculated COP of the most comparable product, we find reasonable grounds to believe or suspect that sales of the foreign like product were made below the COP, within the meaning of section 773(b)(2)(A)(i) of the Act. Accordingly, the Department is initiating a country-wide cost investigation.
Normal Value Based on Constructed Value (“CV”)
Because they alleged sales below cost, pursuant to sections 773(a)(4), 773(b) and 773(e) of the Act, Petitioners calculated NV based on CV. Petitioners calculated CV using the same average COM, SG&A, financial expense, and packing figures used to compute the COP. Petitioners relied on the same FY ended March 31, 2013, audited unconsolidated financial statements used as the basis for the factory overhead, SG&A, and financial expense rates to calculate the profit rate.
Petitioners based NV on CV, as neither a home market nor a third-country price was reasonably available. Pursuant to section 773(e) of the Act, CV consists of the COM; SG&A expenses; financial expenses; packing expenses; and profit. Petitioners calculated COM (except factory overhead) and packing expenses based on the input quantities of Vulcan's Pelham facility adjusted for known differences, during the anticipated POI, multiplied by the value of the inputs used to manufacture threaded rod in Thailand using publicly-available data. Petitioners used their actual tolling costs of zinc coating and hot-dip galvanization because Petitioners did not perform these processes in-house.
To determine factory overhead, SG&A, and financial expense rates, Petitioners relied on the FY ended December 31, 2011 financial statements of a Thai producer of comparable merchandise. Petitioners relied on the same FY ended December 31, 2011 financial statements used as the basis for the factory overhead, SG&A, and financial expense rates to calculate the profit rate.
Fair Value Comparisons
Based on the data provided by Petitioners, there is reason to believe that imports of threaded rod from India and Thailand are being, or are likely to be, sold in the United States at less than fair value. Based on comparisons of EP to CV in accordance with section 773(a)(4) of the Act, the estimated dumping margins for threaded rod from India and Thailand range from from 17.93-119.87 percent,
and 63.16-74.90 percent,
Initiation of Antidumping Investigations
Based upon the examination of the Petitions on steel threaded rod from India and Thailand, we find that the Petitions meet the requirements of section 732 of the Act. Therefore, we are initiating AD investigations to determine whether imports of steel threaded rod from India and Thailand are being, or are likely to be, sold in the United States at less than fair value. In accordance with section 733(b)(1)(A) of the Act and 19 CFR 351.205(b)(1), Start Printed Page 44530unless postponed, we will make our preliminary determinations no later than 140 days after the date of this initiation.
Following standard practice in AD investigations involving market economy countries, in the event the Department determines that the number of known exporters or producers for this investigation is large, the Department may select respondents based on U.S. Customs and Border Protection (“CBP”) data for U.S. imports of threaded rod from India or Thailand under Harmonized Tariff Schedule of the United States subheadings 7318.15.5051, 7318.15.5056, 7318.15.5090 and 7318.15.2095. We intend to release the CBP data under Administrative Protective Order (“APO”) to all parties with access to information protected by APO within five days of publication of this Federal Register notice.
The Petitions identified 69 producers and/or exporters of steel threaded rod in India,
and 18 producers and/or exporters of steel threaded rod in Thailand.
We intend to make our decision regarding respondent selection within 20 days of publication of this notice. The Department invites comments regarding the CBP data and respondent selection within seven days of publication of this Federal Register notice for India and Thailand.
Distribution of Copies of the Petitions
In accordance with section 732(b)(3)(A) of the Act and 19 CFR 351.202(f), copies of the public version of the Petitions have been provided to the Governments of India and Thailand via IA ACCESS. To the extent practicable, we will attempt to provide a copy of the public version of the Petitions to each exporter named in the Petitions, as provided under 19 CFR 351.203(c)(2).
We have notified the ITC of our initiation, as required by section 732(d) of the Act.
Preliminary Determinations by the ITC
The ITC will preliminarily determine no later than August 12, 2013, whether there is a reasonable indication that imports of steel threaded rod from India and Thailand are materially injuring or threatening material injury to a U.S. industry. A negative ITC determination for any country will result in the investigation being terminated with respect to that country; otherwise, these investigations will proceed according to statutory and regulatory time limits.
Submission of Factual Information
On April 10, 2013, the Department published Definition of Factual Information and Time Limits for Submission of Factual Information: Final Rule, 78 FR 21246 (April 10, 2013), which modified two regulations related to AD and countervailing duty (“CVD”) proceedings: The definition of factual information (19 CFR 351.102(b)(21)), and the time limits for the submission of factual information (19 CFR 351.301). The final rule identifies five categories of factual information in 19 CFR 351.102(b)(21), which are summarized as follows: (i) Evidence submitted in response to questionnaires; (ii) evidence submitted in support of allegations; (iii) publicly available information to value factors under 19 CFR 351.408(c) or to measure the adequacy of remuneration under 19 CFR 351.511(a)(2); (iv) evidence placed on the record by the Department; and (v) evidence other than factual information described in (i)-(iv). The final rule requires any party, when submitting factual information, to specify under which subsection of 19 CFR 351.102(b)(21) the information is being submitted and, if the information is submitted to rebut, clarify, or correct factual information already on the record, to provide an explanation identifying the information already on the record that the factual information seeks to rebut, clarify, or correct. The final rule also modified 19 CFR 351.301 so that, rather than providing general time limits, there are specific time limits based on the type of factual information being submitted. These modifications are effective for all proceeding segments initiated on or after May 10, 2013, and thus are applicable to these investigations. Please review the final rule, available at http://ia.ita.doc.gov/frn/2013/1304frn/2013-08227.txt, prior to submitting factual information in these investigations.
Notification to Interested Parties
Interested parties must submit applications for disclosure under administrative protective order in accordance with 19 CFR 351.305. On January 22, 2008, the Department published Antidumping and Countervailing Duty Proceedings: Documents Submission Procedures; APO Procedures, 73 FR 3634 (January 22, 2008). Parties wishing to participate in these investigations should ensure that they meet the requirements of these procedures (e.g., the filing of letters of appearance as discussed at 19 CFR 351.103(d)).
Any party submitting factual information in an AD or CVD proceeding must certify to the accuracy and completeness of that information.
Parties are hereby reminded that revised certification requirements are in effect for company/government officials as well as their representatives in all segments of any AD or CVD proceedings initiated on or after March 14, 2011.
The formats for the revised certifications are provided at the end of the Interim Final Rule. The Department intends to reject factual submissions in any proceeding segments initiated on or after March 14, 2011, if the submitting party does not comply with the revised certification requirements.
This notice is issued and published pursuant to section 777(i) of the Act and 19 CFR 351.203(c).
Dated: July 17, 2013.
Assistant Secretary for Import Administration.
Scope of the Investigations
The merchandise covered by these investigations is steel threaded rod. Steel threaded rod is certain threaded rod, bar, or studs, of carbon quality steel, having a solid, circular cross section, of any diameter, in any straight length, that have been forged, turned, cold-drawn, cold-rolled, machine straightened, or otherwise cold-finished, and into which threaded grooves have been applied. In addition, the steel threaded rod, bar, or studs subject to these investigations are nonheaded and threaded along greater than 25 percent of their total length. A variety of finishes or coatings, such as plain oil finish as a temporary rust protectant, zinc coating (i.e., galvanized, whether by electroplating or hot-dipping), paint, and other similar finishes and coatings, may be applied to the merchandise.
Included in the scope of these investigations are steel threaded rod, bar, or studs, in which: (1) Iron predominates, by weight, over each of the other contained elements; (2) the carbon content is 2 percent or less, by weight; and (3) none of the elements listed below exceeds the quantity, by weight, respectively indicated:
- 1.80 percent of manganese, or
- 1.50 percent of silicon, orStart Printed Page 44531
- 1.00 percent of copper, or
- 0.50 percent of aluminum, or
- 1.25 percent of chromium, or
- 0.30 percent of cobalt, or
- 0.40 percent of lead, or
- 1.25 percent of nickel, or
- 0.30 percent of tungsten, or
- 0.012 percent of boron, or
- 0.10 percent of molybdenum, or
- 0.10 percent of niobium, or
- 0.41 percent of titanium, or
- 0.15 percent of vanadium, or
- 0.15 percent of zirconium.
Steel threaded rod is currently classifiable under subheadings 7318.15.5051, 7318.15.5056, 7318.15.5090 and 7318.15.2095 of the Harmonized Tariff Schedule of the United States (“HTSUS”). Although the HTSUS subheadings are provided for convenience and customs purposes, the written description of the merchandise is dispositive.
Excluded from the scope of these investigations are: (a) Threaded rod, bar, or studs which are threaded only on one or both ends and the threading covers 25 percent or less of the total length; and (b) threaded rod, bar, or studs made to American Society for Testing and Materials (“ASTM”) A193 Grade B7, ASTM A193 Grade B7M, ASTM A193 Grade B16, and ASTM A320 Grade L7.
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[FR Doc. 2013-17794 Filed 7-23-13; 8:45 am]
BILLING CODE 3510-DS-P