Notice of Preliminary Results of Antidumping Duty Administrative Review; Oil Country Tubular Goods From Argentina

AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

ACTION:

Notice of preliminary results of antidumping duty administrative review.

SUMMARY:

In response to a request from petitioners North Star Steel Ohio, a division of North Star Steel Company, and United States Steel LLC (currently known as United States Steel Corporation), the Department of Commerce (the Department) is conducting an administrative review of the antidumping duty order on oil country tubular goods from Argentina. This administrative review covers imports of subject merchandise from Siderca S.A.I.C. (Siderca) and Acindar Industria Argentina de Aceros S.A. (Acindar). The period of review is August 1, 2000, through July 31, 2001.

EFFECTIVE DATE:

September 9, 2002.

FOR FURTHER INFORMATION CONTACT:

Fred Baker, Mike Heaney, or Robert James, AD/CVD Enforcement, Group III, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW., Washington, DC 20230, telephone: (202) 482-2924, (202) 482-4475, or (202) 482-0649, respectively.

SUPPLEMENTARY INFORMATION:

Applicable Statute and Regulations

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

Background

On August 11, 1995, the Department published the antidumping duty order on oil country tubular goods from Argentina. See Antidumping Duty Order: Oil Country Tubular Goods from Argentina, 60 FR 41055 (August 11, 1995). On August 31, 2001, North Star Steel Ohio, a division of North Star Steel Company, requested that the Department conduct an administrative review of sales of the subject merchandise made by Siderca. Also on August 31, 2001, United States Steel LLC, requested that the Department conduct an administrative review of sales of the subject merchandise made by Acindar. (United States Steel LLC changed its name to United States Steel Corporation effective January 1, 2002. See petitioner's submission of January 4, 2002.)

On October 1, 2001, the Department initiated the administrative review. See Initiation of Antidumping and Countervailing Duty Administrative Reviews and Requests for Revocation in Part, 66 FR 49924 (October 1, 2001).

On October 25, 2001, the Department issued its antidumping duty questionnaire to Acindar and Siderca. Because Acindar's home market was not viable, and because Acindar had no sales to any third-country markets, the Department did not require that Acindar respond to section B of the questionnaire, but did require that it respond to D of the questionnaire. See memoranda to the file dated November 20, 2001 and December 10, 2001. On November 16, 2001, the Department received Acindar's Section A response to the questionnaire. On December 13, 2001, the Department received Acindar's Sections C and D responses. On January 28, 2002, the Department issued a supplemental questionnaire for sections A, C, and D of the questionnaire. Acindar submitted its supplemental responses on February 28, 2002. The Department verified Acindar's sales and cost responses from July 9 through July 13, 2002. The results of the verification are found in the verification report dated August 27, 2002, on file in the Central Records Unit of the Department of Commerce.

In response to the Department's October 25, 2001, questionnaire, Siderca stated in a November 6, 2001, submission that it had no consumption entries of subject merchandise during the period of review (POR). Siderca submitted information on its temporary import bond entries on December 19, 2001. In addition, on February 20, 2002, Siderca submitted a written response to the Department's questions regarding specific entries that appeared on a Customs entries list. We will continue to seek confirmation of Siderca's claim that it had no entries of subject merchandise during the POR, and will put the results of our research in a memorandum which we will place on the record of this review in the Central Records Unit of the Department of Commerce.

The margin for Siderca indicated below under “Preliminary Results of Review” represents the margin for Siderca from the less-than-fair-value investigation, which was the most recently completed segment of this proceeding in which Siderca's U.S. sales were analyzed. See Final Determination of Sales at Less Than Fair Value: Oil Country Tubular Goods from Argentina, 60 FR 33539 (June 28, 1995). The margin for Acindar indicated below under “Preliminary Results of Review” is based on our analysis of its data submitted for this review.

Verification

As provided in section 782(i) of the Tariff Act, we verified the sales and cost information provided by Acindar using standard verification procedures, including on-site inspection of the manufacturer's facilities and the examination of relevant sales and financial records. Our verification results are outlined in the public and proprietary versions of the verification report, which are on file in the Central Records Unit of the Department.

Period of Review

The POR is August 1, 2000, through July 31, 2001.

Scope of the Review

Oil country tubular goods (OCTG) are hollow steel products of circular cross-section, including oil well casing and tubing of iron (other than cast iron) or steel (both carbon and alloy), whether seamless or welded, whether or not conforming to American Petroleum Institute (API) or non-API specifications, whether finished or unfinished (including green tubes and limited service OCTG products).

This scope does not cover casing or tubing pipe containing 10.5 percent or more of chromium. Drill pipe was excluded from this order beginning August 11, 2001. See Continuation of Countervailing and Antidumping Duty Orders on Oil Country Tubular Goods From Argentina, Italy, Japan, Korea and Mexico, and Partial Revocation of Those Orders From Argentina and Mexico With Respect to Drill Pipe, 66 FR 38630 (July 25, 2001).

The OCTG subject to this order are currently classified in the Harmonized Tariff Schedule of the United States (HTSUS) under item numbers: 7304.29.10.10, 7304.29.10.20, 7304.29.10.30, 7304.29.10.40, 7304.29.10.50, 7304.29.10.60, 7304.29.10.80, 7304.29.20.10, 7304.29.20.20, 7304.29.20.30, 7304.29.20.40, 7304.29.20.50, 7304.29.20.60, 7304.29.20.80, 7304.29.30.10, 7304.29.30.20, 7304.29.30.30, 7304.29.30.40, 7304.29.30.50, 7304.29.30.60, 7304.29.30.80, 7304.29.40.10, 7304.29.40.20, 7304.29.40.30, 7304.29.40.40, 7304.29.40.50, 7304.29.40.60, 7304.29.40.80, 7304.29.50.15, 7304.29.50.30, 7304.29.50.45, 7304.29.50.60, 7304.29.50.75, 7304.29.60.15, 7304.29.60.30, 7304.29.60.45, 7304.29.60.60, 7304.29.60.75, 7305.20.20.00, 7305.20.40.00, 7305.20.60.00, 7305.20.80.00, 7306.20.10.30, 7306.20.10.90, 7306.20.20.00, 7306.20.30.00, 7306.20.40.00, 7306.20.60.10, 7306.20.60.50, 7306.20.80.10, and 7306.20.80.50.

The HTSUS subheadings are provided for convenience and customs purposes. Our written description of the scope of this order is dispositive.

Product Comparisons

In accordance with 771(16) of the Tariff Act, we considered all products produced by the respondents, covered by the descriptions in the “Scope of the Review” section of this notice, supra, to be foreign like products for the purpose of determining appropriate product comparisons to U.S. sales of oil country tubular goods. However, Acindar's home market was not viable, and it had no sales of subject merchandise in any third-country markets. See Acindar's February 28, 2002, submission, exhibit SA-1. Therefore, we relied upon constructed value (CV) for purposes of determining normal value (NV).

We relied on seven characteristics to match U.S. sales of subject merchandise to CV: seamless/welded, finished grade v. unfinished, end finish, outside diameter, length, normalized/non-full body normalized, and wall thickness.

Export Price

In accordance with section 772(a) of the Tariff Act, export price (EP) is the price at which the subject merchandise is first sold (or agreed to be sold) before the date of importation by the producer or exporter of the subject merchandise outside of the United States to an unaffiliated purchaser for exportation to the United States. In accordance with section 772(b) of the Tariff Act, constructed export price (CEP) is the price at which the subject merchandise is first sold (or agreed to be sold) in the United States before or after the date of importation by or for the account of the producer or exporter of such merchandise or by a seller affiliated with the producer or exporter, to an unaffiliated purchaser, as adjusted under sections 772(c) and (d) of the Tariff Act. For purposes of this review Acindar has classified its sale(s) as EP sales. See December 13, 2001, section C response, at C-9.

Acindar has stated that it sells to only unaffiliated trading companies in the United States during the POR. See November 16, 2001, section A response at A-14. Based on Acindar's description of its U.S. sales process, that it sells the merchandise directly to unaffiliated trading companies in the U.S. market, and did not sell in the United States through an affiliated U.S. importer, we preliminarily determine that Acinar's U.S. sales are EP sales. We calculated EP in accordance with section 772(a) of the Tariff Act. We based EP on packed prices for export to distributors in the U.S. market. We made deductions for foreign inland freight, international freight, domestic brokerage, and U.S. unloading expenses.

Normal Value

In accordance with section 773(a)(1)(C) of the Tariff Act, to determine whether there was sufficient volume of sales in the home market to serve as a viable basis for calculating NV, we compared Acindar's volume of home market sales of the foreign like product to the volume of U.S. sales of the subject merchandise. Because Acindar's aggregate volume of home market sales of the foreign like product was less than five percent of its aggregate volume of U.S. sales for the subject merchandise, we determined that the home market was not viable. Furthermore, Acindar did not sell to third-country markets during the POR. See Acindar's November 16, 2001, submission, at A-3. Therefore, we utilized CV as the NV.

We calculated CV as the sum of Acindar's cost of materials, fabrication, SG&A (including interest), profit, and U.S. packing costs. Our calculation of cost of materials, fabrication, SG&A, and U.S. packing were in accordance with section 773(e) of the Tariff Act. However, because Acindar's home market was not viable, we calculated profit from Siderca's financial statement in accordance with section 773(e)(2)(B)(ii). We utilized its financial statement for the period ending March 31, 2001. We also made circumstance-of-sale adjustments to CV by deducting the selling expenses reported on Acindar's financial statement, and adding the direct selling expenses reported for Acindar's U.S. sales, in accordance with section 773(a)(8) of the Tariff Act. We also made a deduction from CV for internal taxes rebated upon exportation of the subject merchandise in accordance with 773(e) of the Tariff Act.

Level of Trade

Since Acindar has no viable comparison market, and since we based CV selling expenses on Acindar's financial statement (which records selling expenses for more than just subject merchandise, and which does not break out selling expenses by level of trade or by merchandise), we have no way of conducting a level of trade analysis. For this reason we made no LOT adjustment to Acindar's NV.

Currency Conversion

We made currency conversions into U.S. dollars based on the exchange rates in effect on the dates of the U.S. sales as certified by the Federal Reserve Bank, in accordance with section 773A(a) of the Tariff Act.

Preliminary Results of Review

As a result of our review, we preliminarily determine the weighted-average dumping margin for the period August 1, 2000, through July 31, 2001, to be as follows:

The Department will disclose calculations performed in connection with these preliminary results of review within five days of the date of publication of this notice in accordance with 19 CFR 351.224(b). Interested parties may submit case briefs and/or written comments no later than 30 days after the date of publication of these preliminary results of review. Rebuttal briefs and rebuttals to written comments, limited to issues raised in the case briefs and comments, may be filed no later than 35 days after the date of publication of this notice. Parties who submit argument in these proceedings are requested to submit with the argument: (1) A statement of the issue, (2) a brief summary of the argument, and (3) a table of authorities. An interested party may request a hearing within 30 days of publication. See CFR 351.310(c). Any hearing, if requested, will be held 37 days after the date of publication, or the first business day thereafter, unless the Department alters the date per 19 CFR 351.310(d). The Department will issue the final results of these preliminary results, including the results of our analysis of the issues raised in any such written comments or at a hearing, within 120 days of publication of these preliminary results.

Assessment Rates

Upon completion of this administrative review, the Department will determine, and the Customs Service shall assess, antidumping duties on all appropriate entries. In accordance with 19 CFR 351.212(b)(1), we have calculated an exporter/importer-specific assessment rate for merchandise subject to this review. The Department will issue appropriate assessment instructions directly to the Customs Service within 15 days of publication of the final results of review. Because Acindar did not report entered values, we plan to issue appraisement instructions based on reported sales quantities. If these preliminary results are adopted in the final results of review, we will direct the Customs Service to assess the resulting assessment rates against the entered customs quantities for the subject merchandise on each of the importer's/customer's entries during the review period.

Furthermore, the following deposit requirements will be effective upon completion of the final results of this administrative review for all shipments of the subject merchandise entered, or withdrawn from warehouse, for consumption on or after the publication date of the final results of this administrative review, as provided by section 751(a)(1) of the Tariff Act: (1) The cash deposit rates for the reviewed company will be the rates established in the final results of the administrative review (except that no deposit will be required if the rate is zero or de minimis, i.e., less than 0.5 percent); (2) for merchandise exported by manufacturers or exporters not covered in this review but covered in the original less-than-fair-value (LTFV) investigation or a previous review, the cash deposit will continue to be the most recent rate published in the final determination or final results for which the manufacturer or exporter received a company-specific rate; (3) if the exporter is not a firm covered in this review, or the original investigation, but the manufacturer is, the cash deposit rate will be that established for the most recent period for the manufacturer of the merchandise; and (4) if neither the exporter nor the manufacturer is a firm covered in this review, any previous reviews, or the LTFV investigation, the cash deposit rate will be 1.36 percent, the “all others” rate established in the LTFV investigation. See Antidumping Duty Order: Oil Country Tubular Goods from Argentina, 60 FR 41055 (August 11, 1995).

This notice also serves as a preliminary reminder to importers of their responsibility under 19 CFR 351.402(f) 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 this notice in accordance with sections 751(a)(1) and 777(i)(1) of the Tariff Act.