Certain Steel Concrete Reinforcing Bars From Turkey; Preliminary Results of Antidumping Duty Administrative Review

AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

SUMMARY:

In response to a request by the petitioner and two producers/exporters of the subject merchandise, the Department of Commerce is conducting an administrative review of the antidumping duty order on certain steel concrete reinforcing bars from Turkey. This review covers three manufacturers/exporters of the subject merchandise to the United States. This is the fourth period of review, covering April 1, 2000, through March 31, 2001.

We have preliminarily determined that sales have been made below the normal value by certain of the companies subject to this review. In addition, we have preliminarily determined to rescind the review with respect to Diler Demir Celik Endustrisi ve Ticaret A.S., Yazici Demir Celik Sanayi ve Ticaret A.S., and Diler Dis Ticaret A.S., and ICDAS Celik Enerji Tersane ve Ulasim Sanayi, A.S. because these companies had no shipments of subject merchandise during the period of review. If these preliminary results are adopted in the final results of this review, we will instruct the Customs Service to assess antidumping duties on all appropriate entries.

We invite interested parties to comment on these preliminary results. Parties who wish to submit comments in this proceeding are requested to submit with each argument: (1) A statement of the issue; and (2) a brief summary of the argument.

EFFECTIVE DATE:

May 1, 2002.

FOR FURTHER INFORMATION CONTACT:

Irina Itkin or Elizabeth Eastwood, Office of AD/CVD Enforcement, Office 2, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW, Washington, DC, 20230; telephone (202) 482-0656 or (202) 482-3874, respectively.

Applicable Statue and Regulations

Unless otherwise indicated, all citations to the Tariff Act of 1930, as amended (the Act), are references to the provisions effective January 1, 1995, the effective date of the amendments made to the Act by the Uruguay Round Agreements Act. In addition, unless otherwise indicated, all citations to the Department of Commerce's (the Department's) regulations are to 19 CFR Part 351 (2001).

Background

On April 2, 2001, the Department published in the Federal Register a notice of “Opportunity to Request an Administrative Review” of the antidumping duty order on certain steel concrete reinforcing bars (rebar) from Turkey (66 FR 17523).

In accordance with 19 CFR 351.213(b)(2), in April 2001, the Department received requests from HABAS Sinai ve Tibbi Gazlar Istihsal Endustrisi A.S. (Habas) and ICDAS Celik Enerji Tersane ve Ulasim Sanayi, A.S. (ICDAS) to conduct an administrative review of the antidumping duty order on rebar from Turkey. In accordance with 19 CFR 351.213(b)(1), on April 30, 2001, the Department also received a request for an administrative review from the petitioner, AmeriSteel, for the following four producers/exporters of rebar: Colakoglu Metalurji A.S. (Colakoglu); Diler Demir Celik Endustrisi ve Ticaret A.S., Yazici Demir Celik Sanayi ve Ticaret A.S., and Diler Dis Ticaret A.S. (collectively “Diler”); Ekinciler Holding, A.S. and Ekinciler Demir Celik A.S. (collectively “Ekinciler”); and ICDAS.

In May 2001, the Department initiated an administrative review for Colakoglu, Diler, Ekinciler, Habas, and ICDAS (66 FR 28421 (May 17, 2001)) and issued questionnaires to them.

In May 2001, Diler informed the Department that it had no shipments of subject merchandise to the United States during the period of review (POR). We reviewed Customs Service data to confirm that Diler had no shipments of subject merchandise during the POR. Consequently, in accordance with 19 CFR 351.213(d)(3) and consistent with our practice, we are preliminarily rescinding our review for Diler. For further discussion, see the “Partial Rescission of Review” section of this notice, below.

In August and September, 2001, we received responses to sections A through C of the questionnaire (i.e., the sections regarding sales to the home market and the United States) and a response to Section D of the questionnaire (i.e., the section regarding cost of production (COP) and constructed value (CV)) from Colakoglu, Ekinciler, Habas, and ICDAS.

Regarding ICDAS, in its Section A response, this company informed the Department that it had a single sale of subject merchandise that entered the United States after the POR. Accordingly, ICDAS requested that the Department extend the POR to capture this sale. We have determined that it is not appropriate to expand the POR to capture this one sale and we are rescinding the review with respect to ICDAS because it did not have entries of subject merchandise during the POR. For further discussion, see the “Partial Rescission of Review” section of this notice, below.

In September 2001, we issued a supplemental questionnaire regarding sections A through C to Habas. We received a response to this questionnaire in October 2001.

In November and December 2001, we issued supplemental questionnaires regarding sections A through C to Colakoglu and sections A through D to Ekinciler.

On November 29, 2001, the Department postponed the preliminary results of this review until no later than April 30, 2002. See Certain Steel Concrete Reinforcing Bars From Turkey; Notice of Extension of Time Limit for Preliminary Results in Antidumping Duty Administrative Review, 66 FR 63218 (Dec. 5, 2001).

In January and February 2002, we issued section D supplemental questionnaires to Colakoglu and Habas. We received responses to these questionnaires in February and March 2002.

Scope of the Review

The product covered by this review is all stock deformed steel concrete reinforcing bars sold in straight lengths and coils. This includes all hot-rolled deformed rebar rolled from billet steel, rail steel, axle steel, or low-alloy steel. It excludes (i) plain round rebar, (ii) rebar that a processor has further worked or fabricated, and (iii) all coated rebar. Deformed rebar is currently classifiable in the Harmonized Tariff Schedule of the United States (HTSUS) under item numbers 7213.10.000 and 7214.20.000. The HTSUS subheadings are provided for convenience and customs purposes. The written description of the scope of this proceeding is dispositive.

Period of Review

The POR is April 1, 2000, through March 31, 2001.

Partial Rescission of Review

As noted above, Diler informed the Department that it had no shipments of subject merchandise to the United States during the POR. We have confirmed this with the Customs Service. Additionally, as noted above, ICDAS did not have entries of subject merchandise during the POR and requested that the Department extend the POR to capture one sale of subject merchandise that entered the United States after the POR. However, we have determined that it is not appropriate to expand the POR to capture this sale. For further discussion, see the memorandum entitled “Status of Review for ICDAS Celik Enerji Tersane ve Ulasim Sanayi A.S. in the 2000-2001 Antidumping Duty Administrative Review on Certain Steel Concrete Reinforcing Bars from Turkey,” dated August 28, 2001. Therefore, in accordance with 19 CFR 351.213(d)(3) and consistent with the Department's practice, we are preliminarily rescinding our review with respect to Diler and ICDAS. (See e.g., Certain Welded Carbon Steel Pipe and Tube from Turkey; Final Results and Partial Rescission of Antidumping Administrative Review, 63 FR 35190, 35191 (June 29, 1998); and Certain Fresh Cut Flowers from Colombia; Final Results and Partial Rescission of Antidumping Duty Administrative Review, 62 FR 53287 (Oct. 14, 1997).)

Level of Trade

In accordance with section 773(a)(1)(B) of the Act, to the extent practicable, we determine normal value (NV) based on sales in the comparison market at the same level of trade as export price (EP). The NV level of trade is that of the starting-price sales in the comparison market or, when NV is based on CV, that of the sales from which we derive selling, general and administrative expenses (SG&A) and profit. For EP, the U.S. level of trade is also the level of the starting-price sale, which is usually from the exporter to the unaffiliated U.S. customer.

To determine whether NV sales are at a different level of trade than EP sales, we examine stages in the marketing process and selling functions along the chain of distribution between the producer and the unaffiliated customer. If the comparison-market sales are at a different level of trade and the difference affects price comparability, as manifested in a pattern of consistent price differences between the sales on which NV is based and comparison-market sales at the level of trade of the export transaction, we make a level-of-trade adjustment under section 773(a)(7)(A) of the Act.

Colakoglu claimed that it made home market sales at more than one level of trade, while the remaining respondents claimed that they made home market sales at only one level of trade. We analyzed the information on the record for each company and found that each respondent, including Colakoglu, performed essentially the same marketing functions in selling to all of its home market and U.S. customers, regardless of customer category (e.g., end user, distributor). Therefore, we determine that these sales are at the same level of trade. We further determine that no level-of-trade adjustment is warranted for any of the respondents. For a detailed explanation of this analysis, see the memorandum entitled “Concurrence Memorandum for the Preliminary Results of the 2000-2001 Antidumping Duty Administrative Review on Certain Steel Concrete Reinforcing Bars from Turkey,” dated April 25, 2002 (the “concurrence memo”).

Comparisons to Normal Value

To determine whether sales of rebar from Turkey were made in the United States at less than normal value, we compared the EP to the NV. Because Turkey's economy experienced significant inflation during the POR, as is Department practice, we limited our comparisons to home market sales made during the same month in which the U.S. sale occurred and did not apply our “90/60” contemporaneity rule (see, e.g., Certain Porcelain on Steel Cookware from Mexico: Final Results of Antidumping Duty Administrative Review, 62 FR 42496, 42503 (Aug. 7, 1997)). This methodology minimizes the extent to which calculated dumping margins are overstated or understated due solely to price inflation that occurred in the intervening time period between the U.S. and home market sales.

In all previous segments of this proceeding, we compared products sold in the United States to products sold in the home market in the ordinary course of trade that were identical with respect to the following characteristics: grade, size, ASTM specification, and form. In this segment, however, we have reconsidered this hierarchy and are now treating form as the most important physical characteristic, based on comments received by one of the respondents in this review. Where there were no home market sales of merchandise that was identical in these respects to the merchandise sold in the United States, we compared U.S. products with the most similar merchandise sold in the home market based on the characteristics listed above, in that order of priority. For further discussion, see the concurrence memo. In making the above change, we considered comments filed by all interested parties. We invite interested parties to comment on our revision of the matching hierarchy in their case briefs.

Export Price

For all U.S. sales we used EP, in accordance with section 772(a) of the Act, because the subject merchandise was sold directly to the first unaffiliated purchaser in the United States prior to importation and constructed export price methodology was not otherwise warranted based on the facts of record.

A. Colakoglu

We based EP on packed prices to the first unaffiliated purchaser in the United States. We made deductions for ocean freight expenses, marine insurance expenses, inspection fees, lashing and loading expenses, demurrage expenses, and exporter association fees (offset by freight commission revenue, wharfage revenue, despatch revenue, demurrage commission revenue, agency fee revenue, attendance fee revenue, and other freight-related revenue), where appropriate, in accordance with section 772(c)(2)(A) of the Act.

B. Ekinciler

We based EP on packed prices to the first unaffiliated purchaser in the United States. We made deductions for inspection expenses, exporter association fees, surveying expenses, dunnage expenses, brokerage and handling expenses, marine insurance, international freight expenses, and customs clearance fees, where appropriate, in accordance with section 772(c)(2)(A) of the Act.

C. Habas

We based EP on packed prices to the first unaffiliated purchaser in the United States. We made deductions for foreign inland freight expenses, exporter association fees, surveying expenses, brokerage and handling expenses, and international freight expenses, where appropriate, in accordance with section 772(c)(2)(A) of the Act.

Normal Value

In order to determine whether there is a sufficient volume of sales in the home market to serve as a viable basis for calculating NV (i.e., the aggregate volume of home market sales of the foreign like product is five percent or more of the aggregate volume of U.S. sales), we compared the volume of each respondent's home market sales of the foreign like product to the volume of U.S. sales of subject merchandise, in accordance with section 773(a)(1)(C) of the Act. Based on this comparison, we determined that each respondent had a viable home market during the POR. Consequently, we based NV on home market sales.

For each respondent, in accordance with our practice, we excluded home market sales of non-prime merchandise made during the POR from our preliminary analysis based on the limited quantity of such sales in the home market and the fact that no such sales were made to the United States during the POR. (See, e.g., Final Determinations of Sales at Less Than Fair Value: Certain Hot-Rolled Carbon Steel Flat Products, Certain Cold-Rolled Carbon Steel Flat Products, Certain Corrosion-Resistant Carbon Steel Flat Products, and Certain Cut-to-Length Carbon Steel Plate from Korea, 58 FR 37176, 37180 (July 9, 1993).) For further discussion, see the concurrence memo.

Colakoglu and Ekinciler made sales of rebar to affiliated parties in the home market during the POR. Consequently, we tested these sales to ensure that they were made at “arm's-length” prices, in accordance with 19 CFR 351.403(c). To conduct this test, we compared the unit prices of sales to affiliated and unaffiliated customers net of all movement charges, direct selling expenses, and packing. Where prices to the affiliated party were on average 99.5 percent or more of the price to the unaffiliated parties, we determined that these sales were made at arm's length (see Antidumping Duties; Countervailing Duties; Final Rule, 62 FR 27295, 27355 (May 19, 1997) (“Preamble”)). In accordance with the Department's practice, we only included in our margin analysis those sales to the affiliated party that were made at arm's length.

Pursuant to section 773(b)(2)(A)(ii) of the Act, for Colakoglu, Ekinciler, and Habas there were reasonable grounds to believe or suspect that these respondents had made home market sales at prices below their COPs in this review because the Department had disregarded sales that failed the cost test for these companies in the most recently completed segment of this proceeding in which these companies participated (i.e., the less-than-fair-value (LTFV) investigation for Habas and Colakoglu and the 1996-1998 administrative review for Ekinciler). As a result, the Department initiated an investigation to determine whether these companies had made home market sales during the POR at prices below their COP. See Notice of Final Determination of Sales at Less Than Fair Value: Certain Steel Concrete Reinforcing Bars from Turkey, 62 FR 9737, 9740 (Mar. 4, 1997). See also Certain Steel Concrete Reinforcing Bars From Turkey; Final Results of Antidumping Duty Administrative Review and New Shipper Review, 64 FR 49150 (Sept. 10, 1999).

We calculated the COP based on the sum of each respondent's cost of materials and fabrication for the foreign like product, plus amounts for general and administrative and financing expenses, in accordance with section 773(b)(3) of the Act, except as follows. For Habas, we increased the reported materials costs for all products to account for yield loss related to certain billet production because the reported costs did not include an amount for this loss. We based the amount of the adjustment on non-adverse facts available. As facts available, we used the yield loss percentage reported by Habas in its supplemental questionnaire response. For further discussion, see the memorandum entitled “Calculations Performed for Habas Sinai ve Tibbi Gazlar Istihsal Endustrisi A.S. for the Preliminary Results in the 2000-2001 Antidumping Duty Administrative Review on Steel Concrete Reinforcing Bars from Turkey,” dated April 25, 2002. We have requested further information regarding the company's actual yield loss, and we will consider this information for purposes of the final results.

As noted above, we determined that the Turkish economy experienced significant inflation during the POR. Therefore, in order to avoid the distortive effect of inflation on our comparison of costs and prices, we requested that each respondent submit the product-specific cost of manufacturing (COM) incurred during each month of the reporting period. We calculated a period-average COM for each product after indexing the reported monthly costs during the reporting period to an equivalent currency level using the Turkish Wholesale Price Index from the International Financial Statistics published by the International Monetary Fund. We then restated the period-average COMs in the currency values of each respective month.

We compared the weighted-average COP figures to home market prices of the foreign like product, as required under section 773(b) of the Act, in order to determine whether these sales had been made at prices below the COP. On a product-specific basis, we compared the COP to home market prices, less any applicable movement charge, selling expenses, and packing expenses.

In determining whether to disregard home market sales made at prices below the COP, we examined whether such sales were made: 1) In substantial quantities within an extended period of time; and 2) at prices which permitted the recovery of all costs within a reasonable period of time in the normal course of trade. See sections 773(b)(2)(B), (C), and (D) of the Act.

Pursuant to section 773(b)(2)(C)(i) of the Act, where less than 20 percent of a respondent's sales of a given product were at prices less than the COP, we did not disregard any below-cost sales of that product because we determined that the below-cost sales were not made in “substantial quantities.” Where 20 percent or more of a respondent's sales of a given product were at prices below the COP, we found that sales of that model were made in “substantial quantities” within an extended period of time (as defined in section 773(b)(2)(B) of the Act), in accordance with section 773(b)(2)(C)(i) of the Act. In such cases, we also determined that such sales were not made at prices which would permit recovery of all costs within a reasonable period of time, in accordance with section 773(b)(2)(D) of the Act. Therefore, for purposes of this administrative review, we disregarded these below-cost sales and used the remaining sales as the basis for determining NV, in accordance with section 773(b)(1) of the Act. Where all sales of a specific product were at prices below the COP, we disregarded all sales of that product.

A. Colakoglu

We based NV on ex-factory or delivered prices to home market customers. For those home market sales which were negotiated in U.S. dollars, we used the U.S.-dollar price, rather than the Turkish lira (TL) price adjusted for kur farki (i.e., an adjustment to the TL invoice price to account for the difference between the estimated and actual TL value on the date of payment), because the only price agreed upon was a U.S.-dollar price, and this price remained unchanged; the buyer merely paid the TL-equivalent amount at the time of payment. Where appropriate, we made deductions from the starting price for foreign inland freight expenses, in accordance with section 773(a)(6)(B) of the Act.

Pursuant to section 773(a)(6)(C)(iii) of the Act and 19 CFR 351.410(c), we made circumstance-of-sale adjustments for credit expenses (offset by interest revenue), bank charges, and exporter association fees.

We deducted home market packing costs and added U.S. packing costs, in accordance with section 773(a)(6) of the Act.

Where appropriate, we made adjustments to NV to account for differences in physical characteristics of the merchandise, in accordance with section 773(a)(6)(C)(ii) of the Act and 19 CFR 351.411. We based this adjustment on the difference in the variable costs of manufacturing for the foreign like product and subject merchandise, using POR-average costs as adjusted for inflation for each month of the POR, as described above.

B. Ekinciler

We based NV on ex-factory, ex-warehouse or delivered prices to home market customers, adjusted for billing errors. We excluded from our analysis home market re-sales by Ekinciler of merchandise produced by unaffiliated companies. Where appropriate, we made deductions from the starting price for foreign inland freight (offset by freight revenue) and warehousing expenses, in accordance with section 773(a)(6)(B) of the Act.

Pursuant to section 773(a)(6)(C)(iii) of the Act and 19 CFR 351.410(c), we made circumstance-of-sale adjustments for bank charges and exporter association fees. Where applicable, in accordance with 19 CFR 351.410(e), we offset any commission paid on a U.S. sale by reducing the NV by home market indirect selling expenses, up to the amount of the U.S. commission.

We deducted home market packing costs and added U.S. packing costs, in accordance with section 773(a)(6) of the Act.

Where appropriate, we made adjustments to NV to account for differences in physical characteristics of the merchandise, in accordance with section 773(a)(6)(C)(ii) of the Act and 19 CFR 351.411. We based this adjustment on the difference in the variable costs of manufacturing for the foreign like product and subject merchandise, using period-average costs as adjusted for inflation for each month of the reporting period, as described above.

C. Habas

We based NV on the starting prices to home market customers. Pursuant to section 773(a)(6)(C)(iii) of the Act and 19 CFR 351.410(c), we made circumstance-of-sale adjustments for credit expenses and exporter association fees.

We deducted home market packing costs and added U.S. packing costs, in accordance with section 773(a)(6) of the Act.

Where appropriate, we made adjustments to NV to account for differences in physical characteristics of the merchandise, in accordance with section 773(a)(6)(C)(ii) of the Act and 19 CFR 351.411. We based this adjustment on the difference in the variable costs of manufacturing for the foreign like product and subject merchandise, using POR-average costs as adjusted for inflation for each month of the POR, as described above.

Currency Conversion

The Department's preferred source for daily exchange rates is the Federal Reserve Bank. However, the Federal Reserve Bank does not track or publish exchange rates for Turkish Lira. Therefore, we made currency conversions based on the daily exchange rates from the Dow Jones News/Retrieval Service.

Preliminary Results of the Review

We preliminarily determine that the following margins exist for the respondents during the period April 1, 2000, through March 31, 2001:

The Department will disclose to parties the calculations performed in connection with these preliminary results within five days of the date of publication of this notice. Interested parties may request a hearing within 30 days of publication. Any hearing, if requested, will be held two days after the date rebuttal briefs are filed. Pursuant to 19 CFR 351.309, interested parties may submit cases briefs not later than 30 days after the date of publication of this notice. Rebuttal briefs, limited to issues raised in the case briefs, may be filed not later than 37 days after the date of publication of this notice. The Department will issue the final results of the administrative review, including the results of its analysis of issues raised in any such written comments, within 120 days of publication of these preliminary results.

Upon completion of the administrative review, the Department shall determine, and the Customs Service shall assess, antidumping duties on all appropriate entries. Pursuant to 19 CFR 351.212(b)(1), for Habas, we have calculated importer-specific assessment rates based on the ratio of the total amount of antidumping duties calculated for the examined sales to the total entered value of those sales. Regarding Colakoglu and Ekinciler, for assessment purposes, we do not have the information to calculate entered value because these companies are not the importers of record for the subject merchandise. Accordingly, we have calculated importer-specific assessment rates for the merchandise in question by aggregating the dumping margins calculated for all U.S. sales to each importer and dividing this amount by the total quantity of those sales. The assessment rate will be assessed uniformly on all entries of that particular importer made during the POR. Pursuant to 19 CFR 351.106(c)(2), we will instruct the Customs Service to liquidate without regard to antidumping duties any of Habas's entries for which the assessment rate is de minimis (i.e., less than 0.50 percent). The Department will issue appraisement instructions directly to the Customs Service.

Further, the following deposit requirements will be effective for all shipments of rebar from Turkey entered, or withdrawn from warehouse, for consumption on or after the publication date of the final results of this administrative review, as provided for by section 751(a)(2)(C) of the Act: (1) The cash deposit rates for the reviewed companies will be the rates established in the final results of this review; (2) for previously 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, or the 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) the cash deposit rate for all other manufacturers or exporters will continue to be 16.06 percent, the all others rate established in the LTFV investigation.

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

This notice serves as a preliminary reminder to importers of their responsibility under 19 CFR 351.402(f)(2) to file a certificate regarding the reimbursement of antidumping 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 antidumping duties occurred and the subsequent assessment of double antidumping duties.

We are issuing and publishing these results of review in accordance with sections 751(a)(1) and 777(i)(1) of the Act.