Enforcement and Compliance, International Trade Administration, Department of Commerce.
Effective Date: March 17, 2015.
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FOR FURTHER INFORMATION CONTACT:
Magd Zalok at (202) 482-4162 or Thomas Martin at (202) 482-3936, Office IV, AD/CVD Operations, Enforcement and Compliance, U.S. Department of Commerce, 14th Street and Constitution Avenue NW., Washington, DC 20230.
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On February 19, 2015, the Department of Commerce (“Department”) received an antidumping duty (“AD”) petition concerning imports of silicomanganese from Australia filed in proper form on behalf of Felman Production, LLC (“Petitioner”).
Petitioner is a domestic producer of silicomanganese.
On February 20, 2015, the Department requested additional information and clarification with respect to the industry support section of the Petition.
Petitioner filed a response to this request on February 23, 2015.
On February 24, 2015, the Department requested additional information and clarification on certain portions of the Petition.
Petitioner filed a response to this request on February 27, 2015.
On March 3 and 4, 2015, Department personnel spoke with Petitioner's counsel via telephone, requesting additional information and clarification.
Petitioner filed a response to these requests on March 5, 2015.
In accordance with section 732(b) of the Tariff Act of 1930, as amended (“the Act”), Petitioner alleges that silicomanganese from Australia is being, or is 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 Petition is accompanied by information reasonably available to Petitioner supporting its allegations.
The Department finds that Petitioner filed the Petition on behalf of the domestic industry because Petitioner is an interested party as defined in section 771(9)(C) of the Act. The Department also finds that Petitioner demonstrated sufficient industry support with respect to the initiation of the AD investigation that Petitioner is requesting.
Period of Investigation
Because the Petition was filed on February 19, 2015, pursuant to 19 CFR 351.204(b)(1) the period of investigation (“POI”) is January 1, 2014 through December 31, 2014.
Scope of the Investigation
The product covered by this investigation is silicomanganese from Australia. For a full description of the scope of this investigation, see “Scope of the Investigation” in Appendix I of this notice.
Comments on Scope of the Investigation
During our review of the Petition, the Department issued questions to, and received responses from, Petitioner pertaining to the proposed scope to ensure that the scope language in the Petition would be an accurate reflection Start Printed Page 13830of the products for which the domestic industry is seeking relief.
As discussed in the preamble to the Department's regulations,
we are setting aside a period for interested parties to raise issues regarding product coverage (scope). The period for 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 determination. If scope comments include factual information (see 19 CFR 351.102(b)(21)), all such factual information should be limited to public information. All such comments must be filed by 5:00 p.m. Eastern Time (“ET”) on March 31, 2015, which is 20 calendar days from the signature date of this notice. Any rebuttal comments, which may include factual information, must be filed no later than 10 calendar days after the initial comments deadline, which in this instance, is April 10, 2015.
The Department requests that any factual information the parties consider relevant to the scope of the investigation be submitted during this time period. However, if a party subsequently finds that additional factual information pertaining to the scope of the investigation may be relevant, the party may contact the Department and request permission to submit the additional information. All such comments must be filed on the record of this investigation.
All submissions to the Department must be filed electronically using Enforcement and Compliance's Antidumping and Countervailing Duty Centralized Electronic Service System (“ACCESS”).
An electronically-filed document must be received successfully in its entirety by the time and date it is due. Documents excepted from the electronic submission requirements must be filed manually (i.e., in paper form) with Enforcement and Compliance'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 applicable deadlines.
Comments on Product Characteristics for AD Questionnaire
The Department requests comments from interested parties regarding the appropriate physical characteristics of silicomanganese to be reported in response to the Department's AD questionnaire. This information will be used to identify the key physical characteristics of the subject merchandise in order to report the relevant cost 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, although there may be some physical product characteristics utilized by manufacturers to describe silicomanganese, 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 questionnaire, all comments must be filed by 5:00 p.m. ET on March 31, 2015, which is 20 calendar days from the signature date of this notice. Any rebuttal comments must be filed by 5:00 p.m. ET on April 10, 2015. All comments and submissions to the Department must be filed electronically using ACCESS, as explained above, on the record of this investigation.
Determination of Industry Support for the Petition
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.”
Section 771(4)(A) of the Act defines the “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. 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 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).Start Printed Page 13831
With regard to the domestic like product, Petitioner does not offer a definition of the domestic like product distinct from the scope of the investigation. Based on our analysis of the information submitted on the record, we have determined that silicomanganese constitutes a single domestic like product and we have analyzed industry support in terms of that domestic like product.
In determining whether Petitioner has standing under section 732(c)(4)(A) of the Act, we considered the industry support data contained in the Petition with reference to the domestic like product as defined in the “Scope of the Investigation,” in Appendix I of this notice. Petitioner provided its own 2014 production data for the domestic like product.
In addition, Petitioner provided the 2014 domestic like product production data of Eramet Marietta, Inc., which was identified as the only other producer of silicomanganese in the United States.
To establish industry support, Petitioner compared its own production data to data for the total production of the domestic like product for the entire domestic industry.
Our review of the data provided in the Petition, supplemental submissions, and other information readily available to the Department indicates that Petitioner has established industry support.
First, the Petition established support from domestic producers (or workers) accounting for more than 50 percent of the total production of the domestic like product and, as such, the Department is not required to take further action in order to evaluate industry support (e.g., polling).
Second, the domestic producers (or workers) 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 Petition account for at least 25 percent of the total production of the domestic like product.
Finally, 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 Petition 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 Petition.
Accordingly, the Department determines that the Petition was filed on behalf of the domestic industry within the meaning of section 732(b)(1) of the Act.
The Department finds that Petitioner filed the Petition on behalf of the domestic industry because it is an interested party as defined in section 771(9)(C) of the Act and it has demonstrated sufficient industry support with respect to the AD investigation that it is requesting the Department to initiate.
Allegations and Evidence of Material Injury and Causation
Petitioner alleges 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, Petitioner alleges that subject imports exceed the negligibility threshold provided for under section 771(24)(A) of the Act.
Petitioner contends that the industry's injured condition is illustrated by reduced market share; underselling and price depression or suppression; lost sales and revenue; a plant shutdown and the inability to restart a third furnace for production; reduced employment levels; 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.
Allegation of Sales at Less Than Fair Value
The following is a description of the allegation of sales at less than fair value upon which the Department based its decision to initiate an investigation of imports of silicomanganese from Australia. The sources of data relating to U.S. price and NV are discussed in greater detail in the initiation checklist.
Petitioner based export price (“EP”) on the POI average unit value (“AUV”) of silicomanganese imports from Australia under Harmonized Tariff Schedule of the United States (“HTSUS”) subheading 7202.30.0000 (which covers the subject merchandise), calculated using U.S. import statistics obtained from the ITC's Dataweb. The AUV represents FOB Australia port terms. To be conservative, Petitioner made no adjustments to EP for foreign inland freight or other expenses at the port of exportation.
Petitioner alleged that the sales of silicomanganese in Australia were made at prices substantially below the fully-loaded cost of production (“COP”). Accordingly, Petitioner based NV on the constructed value (“CV”) of the imported merchandise.
Petitioner provided information demonstrating reasonable grounds to believe or suspect that sales of silicomanganese in the Australian market were made at prices below the 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”), submitted to Congress in connection with the interpretation and application of 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, section 773(b)(2)(A) of the Act requires that the Department have Start Printed Page 13832“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.
As explained in the “Cost of Production” section below, we find reasonable grounds exist that indicate sales in Australia were made 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. Petitioner calculated COM based on its experience adjusted for known differences between the United States and Australia during the proposed POI.
Petitioner used 2014 global market prices for manganese ore as published in the Metal Bulletin,
Bureau of Labor Statistics wage data,
and electricity rates from an Australian electricity supplier
to account for cost differences between the United States and Australia in the manufacture of silicomanganese. Petitioner calculated the cost of other materials based on its own experience.
Petitioner relied on the 2013 financial statements of Grange Resources Limited, an Australian producer of comparable merchandise (i.e., magnetite pellets), to determine the SG&A and profit ratios, which is consistent with the Department's practice. Petitioner calculated the factory overhead ratio based on its own production experience.
Petitioner obtained a price quote from Tasmanian Electro Metallurgical Company for silicomanganese, meeting ASTM A-483 grade B specifications, for sale in the Australian market. Based upon a comparison of the net price of the foreign like product in the home market to the COP of the product, we find reasonable grounds to believe or suspect that sales of the foreign like product in the comparison market 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 relating to sales of silicomanganese in Australia.
Normal Value Based on Constructed Value
Because home market sales prices fell below COP, pursuant to sections 773(a)(4), 773(b) and 773(e) of the Act, Petitioner based NV on CV.
Petitioner calculated CV using the same COM, SG&A, and financial expense used to calculate the COP, as discussed above. Petitioner relied on Grange Resources Limited's FY 2013 financial statements to determine the profit rate used in the calculation of CV.
Fair Value Comparisons
Based on the data provided by Petitioner, there is reason to believe that imports of silicomanganese from Australia are being, or are likely to be, sold in the United States at less than fair value. Based on comparisons of export price to CV in accordance with section 773(a) of the Act, the estimated AD margin is 77.97 percent.
Initiation of Less-Than-Fair-Value Investigation
Based upon the examination of the Petition on silicomanganese from Australia, we find that the Petition meets the requirements of section 732 of the Act. Therefore, we are initiating an AD investigation to determine whether imports of silicomanganese from Australia 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), unless postponed, we will make our preliminary determination no later than 140 days after the date of this initiation.
The Petition names only one company as a producer/exporter of silicomanganese in Australia: Tasmanian Electro Metallurgical Company, and Petitioner provided information from an independent third-party source as support of this claim.
Furthermore, we currently know of no additional producers/exporters of subject merchandise from Australia. Accordingly, the Department intends to examine all known producers/exporters in this investigation (i.e., the company named above). We invite interested parties to comment on this issue. Parties wishing to comment must do so within five days of the publication of this notice in the Federal Register. Comments must be filed electronically using ACCESS. An electronically-filed document must be received successfully in its entirety by the Department's electronic records system, ACCESS, by 5 p.m. ET by the deadline noted above.
Distribution of Copies of the Petition
In accordance with section 732(b)(3)(A) of the Act and 19 CFR 351.202(f), copies of the public version of the Petition have been provided to the government of Australia. To the extent practicable, we will attempt to provide a copy of the public version of the Petition to each exporter named in the Petition, 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 Determination by the ITC
The ITC will preliminarily determine, within 45 days after the date on which the Petition was filed, whether there is a reasonable indication that imports of silicomanganese from Australia are materially injuring or threatening material injury to a U.S. industry.
A negative ITC determination will result in the investigation being terminated; 
otherwise, the investigation 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) Start Printed Page 13833evidence 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 this investigation. Interested parties should review the final rule, available at http://enforcement.trade.gov/frn/2013/1304frn/2013-08227.txt prior to submitting factual information in this investigation.
Revised Extension of Time Limits Regulation
On September 20, 2013, the Department modified its regulation concerning the extension of time limits for submissions in AD and CVD proceedings.
The modification clarifies that parties may request an extension of time limits before a time limit established under 19 CFR part 351 expires, or as otherwise specified by the Secretary. In general, an extension request will be considered untimely if it is filed after the time limit established under Part 351 expires. For submissions which are due from multiple parties simultaneously, an extension request will be considered untimely if it is filed after 10:00 a.m. on the due date. Examples include but are not limited to: (1) Case and rebuttal briefs, filed pursuant to 19 CFR 351.309; (2) factual information to value factors under 19 CFR 351.408(c), or to measure the adequacy of remuneration under 19 CFR 351.511(a)(2) filed pursuant to 19 CFR 351.301(c)(3) and rebuttal, clarification and correction information filed pursuant to 19 CFR 351.301(c)(3)(iv); (3) comments concerning the selection of a surrogate country and surrogate values and rebuttal; (4) comments concerning U.S. Customs and Border Protection data; and (5) quantity and value questionnaires. Under certain circumstances, the Department may elect to specify a different time limit by which extension requests will be considered untimely for submissions which are due from multiple parties simultaneously. In such a case, the Department will inform parties in a letter or memorandum setting forth the deadline (including a specified time) by which extension requests must be filed to be considered timely. This modification also requires that an extension request be made in a separate, stand-alone submission, and clarifies the circumstances under which the Department will grant untimely-filed requests for the extension of time limits. These modifications are effective for all segments initiated on or after October 21, 2013, and thus are applicable to this investigation. Interested parties should review Extension of Time Limits; Final Rule, available at http://www.gpo.gov/fdsys/pkg/FR-2013-09-20/html/2013-22853.htm, prior to submitting requests to extend time limits in this investigation.
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. Investigations initiated on the basis of petitions filed on or after August 16, 2013, and other segments of any AD or CVD proceedings initiated on or after August 16, 2013, should use the formats for the revised certifications provided at the end of the Final Rule.
The Department intends to reject factual submissions if the submitting party does not comply with the applicable revised certification requirements.
Notification to Interested Parties
Interested parties must submit applications for disclosure under administrative protective orders (“APO”) 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 this investigation should ensure that they meet the requirements of these procedures (e.g., the filing of letters of appearance as discussed in 19 CFR 351.103(d)).
This notice is issued and published pursuant to section 777(i) of the Act and 19 CFR 351.203(c).
Dated: March 11, 2015.
Deputy Assistant Secretary for Antidumping and Countervailing Duty Operations.
Scope of the Investigation
The scope of this investigation covers all forms, sizes and compositions of silicomanganese, except low-carbon silicomanganese, including silicomanganese briquettes, fines, and slag. Silicomanganese is a ferroalloy composed principally of manganese, silicon, and iron, and normally contains much smaller proportions of minor elements, such as carbon, phosphorus, and sulfur. Silicomanganese is sometimes referred to as ferrosilicon manganese.
Silicomanganese generally contains by weight not less than 4 percent iron, more than 30 percent manganese, more than 8 percent silicon and not more than 0.2 percent phosphorus. Silicomanganese is properly classifiable under subheading 7202.30.0000 of the Harmonized Tariff Schedule of the United States (“HTSUS”).
Low-carbon silicomanganese is excluded from the scope of this investigation. It is sometimes referred to as ferromanganese-silicon. The low-carbon silicomanganese excluded from this investigation is a ferroalloy with the following chemical specifications by weight: minimum 55 percent manganese, minimum 27 percent silicon, minimum 4 percent iron, maximum 0.10 percent phosphorus, maximum 0.10 percent carbon, and maximum 0.05 percent sulfur. Low-carbon silicomanganese is classifiable under HTSUS subheading 7202.30.0000.
The HTSUS subheadings are provided for convenience and customs purposes. The written description of the scope is dispositive.
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[FR Doc. 2015-06142 Filed 3-16-15; 8:45 am]
BILLING CODE 3510-DS-P