Carbon and Certain Alloy Steel Wire Rod From Canada: Initiation of Countervailing Duty Changed Circumstances Review

AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

ACTION:

Notice of initiation of changed circumstances review of the countervailing duty order.

SUMMARY:

On October 1, 2003, Georgetown Steel Company (formerly GS Industries), Gerdau Ameristeel U.S. Inc. (formerly Co-Steel Raritan), Keystone Consolidated Industries, Inc., and North Star Steel Texas, Inc., filed a request for a countervailing duty changed circumstances review. Specifically, they request that the Department of Commerce revoke the countervailing duty order on carbon and certain alloy steel wire rod from Canada. In response, the Department of Commerce is initiating a changed circumstances review of the countervailing duty order on carbon and certain alloy steel wire rod from Canada. Interested parties are invited to comment on this notice of initiation.

EFFECTIVE DATE:

November 3, 2003.

FOR FURTHER INFORMATION CONTACT:

S. Anthony Grasso, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW., Washington, DC 20230; telephone (202) 482-3853.

SUPPLEMENTARY INFORMATION:

Background

On October 22, 2002, the Department of Commerce (the “Department”) published a countervailing duty order on carbon and certain alloy steel wire rod from Canada. See Notice of Countervailing Duty Orders: Carbon and Certain Alloy Steel Wire Rod from Brazil and Canada, 67 FR 64871 (October 22, 2002). On October 1, 2003, the Department received a request from Georgetown Steel Company (formerly GS Industries), Gerdau Ameristeel U.S. Inc. (formerly Co-Steel Raritan), Keystone Consolidated Industries, Inc., and North Star Steel Texas, Inc., the petitioners in the original investigation, that the Department initiate a changed circumstances review for purposes of revoking the countervailing duty (“CVD”) order. Also the petitioners request that, upon revocation of the CVD order, the Department fully refund any countervailing duties deposited pursuant to the order. The petitioners state that they are no longer interested in maintaining the countervailing duty order or in the imposition of CVD duties on the subject merchandise.

Scope of the Review

The merchandise covered by this review is certain hot-rolled products of carbon steel and alloy steel, in coils, of approximately round cross section, 5.00 mm or more, but less than 19.00 mm, in solid cross-sectional diameter.

Specifically excluded are steel products possessing the above-noted physical characteristics and meeting the Harmonized Tariff Schedule of the United States (“HTSUS”) definitions for (a) stainless steel; (b) tool steel; (c) high nickel steel; (d) ball bearing steel; and (e) concrete reinforcing bars and rods. Also excluded are (f) free machining steel products (i.e., products that contain by weight one or more of the following elements: 0.03 percent or more of lead, 0.05 percent or more of bismuth, 0.08 percent or more of sulfur, more than 0.04 percent of phosphorus, more than 0.05 percent of selenium, or more than 0.01 percent of tellurium).

Also excluded from the scope are 1080 grade tire cord quality wire rod and 1080 grade tire bead quality wire rod. Grade 1080 tire cord quality rod is defined as: (i) Grade 1080 tire cord quality wire rod measuring 5.0 mm or more but not more than 6.0 mm in cross-sectional diameter; (ii) with an average partial decarburization of no more than 70 microns in depth (maximum individual 200 microns); (iii) having no inclusions greater than 20 microns; (iv) having a carbon segregation per heat average of 3.0 or better using European Method NFA 04-114; (v) having a surface quality with no surface defects of a length greater than 0.15 mm; (vi) capable of being drawn to a diameter of 0.30 mm or less with 3 or fewer breaks per ton, and (vii) containing by weight the following elements in the proportions shown: (1) 0.78 percent or more of carbon, (2) less than 0.01 percent of aluminum, (3) 0.040 percent or less, in the aggregate, of phosphorus and sulfur, (4) 0.006 percent or less of nitrogen, and (5) not more than 0.15 percent, in the aggregate, of copper, nickel and chromium.

Grade 1080 tire bead quality rod is defined as: (i) Grade 1080 tire bead quality wire rod measuring 5.5 mm or more but not more than 7.0 mm in cross-sectional diameter; (ii) with an average partial decarburization of no more than 70 microns in depth (maximum individual 200 microns); (iii) having no inclusions greater than 20 microns; (iv) having a carbon segregation per heat average of 3.0 or better using European Method NFA 04-114; (v) having a surface quality with no surface defects of a length greater than 0.2 mm; (vi) capable of being drawn to a diameter of 0.78 mm or larger with 0.5 or fewer breaks per ton; and (vii) containing by weight the following elements in the proportions shown: (1) 0.78 percent or more of carbon, (2) less than 0.01 percent of soluble aluminum, (3) 0.040 percent or less, in the aggregate, of phosphorus and sulfur, (4) 0.008 percent or less of nitrogen, and (5) either not more than 0.15 percent, in the aggregate, of copper, nickel and chromium (if chromium is not specified), or not more than 0.10 percent in the aggregate of copper and nickel and a chromium content of 0.24 to 0.30 percent (if chromium is specified).

The designation of the products as “tire cord quality” or “tire bead quality” indicates the acceptability of the product for use in the production of tire cord, tire bead, or wire for use in other rubber reinforcement applications such as hose wire. These quality designations are presumed to indicate that these products are being used in tire cord, tire bead, and other rubber reinforcement applications, and such merchandise intended for the tire cord, tire bead, or other rubber reinforcement applications is not included in the scope. However, should petitioners or other interested parties provide a reasonable basis to believe or suspect that there exists a pattern of importation of such products for other than those applications, end-use certification for the importation of such products may be required. Under such circumstances, only the importers of record would normally be required to certify the end use of the imported merchandise.

All products meeting the physical description of subject merchandise that are not specifically excluded are included in this scope.

The products under investigation are currently classifiable under subheadings 7213.91.3010, 7213.91.3090, 7213.91.4510, 7213.91.4590, 7213.91.6010, 7213.91.6090, 7213.99.0031, 7213.99.0038, 7213.99.0090, 7227.20.0010, 7227.20.0020, 7227.20.0090, 7227.20.0095, 7227.90.6051, 7227.90.6053, 7227.90.6058, and 7227.90.6059 of the HTSUS. Although the HTSUS subheadings are provided for convenience and customs purposes, the written description of the scope of this proceeding is dispositive.

Initiation of Changed Circumstances Review

Section 751(d)(1) of the Tariff Act of 1930, as amended (the “Act”), and 19 CFR 351.222(g) of the Department's regulations, provide that the Department may revoke an antidumping or countervailing duty order, in whole or in part, after conducting a changed circumstances review pursuant to section 751(b) of the Act and concluding from the available information that changed circumstances exist sufficient to warrant revocation or termination. The Department may conclude that changed circumstances sufficient to warrant revocation (in whole or in part) exist when producers accounting for substantially all of the production of the domestic like product to which the order pertains have expressed a lack of interest in the order, in whole or in part. See section 782(h)(2) of the Act and § 351.222(g)(1) of the Department's regulations.

The petitioners state that they are producers of carbon and certain alloy steel wire rod but do not identify the percentage of production of the domestic like product they represent. At present, the Department has no information on the record that the other known domestic producers of wire rod have no interest in maintaining the countervailing duty order with respect to the subject merchandise imported from Canada. In particular, the Department does not have information on the record of this changed circumstances review that the petitioners account for substantially all, or at least 85 percent, of the production of the domestic like product. See Certain Tin Mill Products From Japan: Final Results of Changed Circumstances Review, 66 FR 52109 (October 12, 2001); see also, 19 CFR 351.208(c). Accordingly, we are not combining this initiation with a preliminary determination, pursuant to 19 CFR 351.221(c)(3)(ii). This notice of initiation will accord all interested parties an opportunity to address this proposed revocation.

Pursuant to section 751(b)(1) of the Act, the Department will conduct a changed circumstances review upon receipt of information concerning, or a request from an interested party of, a countervailing duty order which shows changed circumstances sufficient to warrant a review of the order. Pursuant to section 751(b)(4) of the Act, the Department finds the petitioners' statement that no further interest exists in continuing the order with respect to carbon and certain alloy steel wire rod from Canada serves as good cause to review a determination that was made less than 24 months after the date of publication of notice of that determination. Therefore, in accordance with section 751(b)(1) of the Act, we are initiating a changed circumstances review based upon the request made by the petitioners.

If, as a result of this review, we revoke the order, we intend to instruct the U.S. Customs and Border Protection (“CBP”) to liquidate without regard to applicable countervailing duties, and refund any estimated countervailing duties collected on, all unliquidated entries of the merchandise subject to the order, as described above under the “Scope of the Review” section, entered, or withdrawn from warehouse, for consumption on or after February 8, 2002, i.e., the publication date of the Department's preliminary determination (see Preliminary Affirmative Countervailing Duty Determination: Carbon and Certain Alloy Steel Wire Rod from Canada, 67 FR 5984). We will also instruct CBP to pay interest on such refunds with respect to the subject merchandise entered, or withdrawn from warehouse, for consumption on or after October 22, 2002, in accordance with section 778 of the Act. The current requirement for a cash deposit of estimated countervailing duties on the subject merchandise will continue unless, and until, we publish a final determination to revoke in whole.

Public Comment

Interested parties are invited to comment on the initiation of this changed circumstances review. Parties who submit argument in this proceeding are requested to submit with the argument (1) a statement of the issue, and (2) a brief summary of the argument. All written comments may be submitted by interested parties not later than 14 days after the date of publication of this notice in accordance with 19 CFR 351.303, with the exception that only three (3) copies need be served on the Department, and shall be served on all interested parties on the Department's service list in accordance with 19 CFR 351.303.

The Department will publish in the Federal Register a notice of preliminary results of changed circumstances review, in accordance with 19 CFR 351.221(c)(3), which will set forth the factual and legal conclusions upon which our preliminary results are based, and a description of any action proposed based on those results.

This notice is published in accordance with section 751(b)(1) of the Act and sections 351.216 and 351.222 of the Department's regulations.