Carbon and Certain Alloy Steel Wire Rod from Canada: Preliminary Results of Countervailing Duty Changed Circumstances Review and Intent to Revoke Order

AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

ACTION:

Notice of Preliminary Results of Changed Circumstances Review of the Countervailing Duty Order and Intent To Revoke Order, in Whole.

SUMMARY:

On November 3, 2003, in response to a request by domestic producers of the subject merchandise, the Department of Commerce (“the Department”) published a notice of initiation of a changed circumstances review of the countervailing duty order on carbon and certain alloy steel wire rod, as described below. See Carbon and Certain Alloy Steel Wire Rod from Canada: Initiation of Countervailing Duty Changed Circumstances Review, 68 FR 62282 (November 3, 2003) (“Initiation Notice”).

In the Initiation Notice, we invited interested parties to comment on the Department's initiation and the proposed revocation of the countervailing duty order on carbon and certain alloy steel wire rod from Canada. We did not receive any comments. Absent any comments, we preliminarily conclude that producers accounting for substantially all of the production of the domestic like product to which this order pertains lack interest in the relief provided by the order. Unless the Department receives opposition from domestic producers whose production totals more than 15 percent of the domestic like product, the Department will revoke the order on carbon and certain alloy steel wire rod in the final results of this review. Therefore, we preliminarily revoke this order, in whole, with respect to products entered, or withdrawn from warehouse, for consumption on or after February 8, 2002, i.e., the publication date of the Department's preliminary determination (see Preliminary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), because domestic parties have expressed no interest in the continuation of the order.

EFFECTIVE DATE:

December 12, 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

The Department published the countervailing duty (“CVD”) order on steel wire rod from Canada on October 22, 2002. 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 US Inc. (formerly Co-Steel Raritan), Keystone Consolidated Industries, Inc., and North Star Steel Texeas, Inc., the petitioners in the original investigation, that the Department initiate a changed circumstances review for purposes of revoking the CVD order. The basis for the petitioners' request is that they are no longer interested in maintaining the countervailing duty order or in the imposition of CVD duties on the subject merchandise.

On November 3, 2003, the Department published a notice of initiation of a changed circumstances review of the countervailing duty order on carbon and certain alloy steel wire rod products from Canada. See Initiation Notice, 68 FR 62282. In the Initiation Notice, we indicated interested parties could submit comments for consideration in the Department's preliminary results not later than 14 days after publication of the initiation of the review, and submit responses to those comments not later than 5 days following the submission of comments. No comments were received. On November 18, 2003, a respondent to the original proceeding, Ispat Sidbec, Inc. (“Ispat”), submitted a letter to the Department stating that “all three parties wish to advise the Department that they agree to the outcome of the review and, further, request that, pursuant to 19 CFR § 351.216(e), the Department render its final results of review within 45 days of initiation of the review or sooner.” Ispat claimed its letter represented the position of the only parties to the proceeding, namely, Ispat, the Government of Quebec, and the U.S. producers that filed the original petition.

Scope of the Order

The merchandise covered by this order 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.¹

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.

Preliminary Results of Review and Intent to Revoke in Whole the Countervailing Duty Order

Pursuant to section 751(d)(1) of the 1930 Tariff Act, as amended (“the Act”), and 19 CFR § 351.222(g), the Department may revoke an antidumping or countervailing duty order, in whole or in part, based on a review under section 751(b) of the Act (i.e., a changed circumstances review). Section 751(b)(1) of the Act requires a changed circumstances review to be conducted upon receipt of a request which shows changed circumstances sufficient to warrant a review. Section 782(h)(1) of the Act gives the Department the authority to revoke an order if producers accounting for substantially all of the production of the domestic like product have expressed a lack of interest in the continuation of the order. Section 351.222(g) of the Department's regulations provides that the Department will conduct a changed circumstances administrative review under 19 CFR § 351.216, and may revoke an order (in whole or in part), if it concludes that (i) 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 relief provided by the order, in whole or in part, or (ii) if other changed circumstances sufficient to warrant revocation exist. The Department has interpreted “substantially all” production normally to mean at least 85 percent of domestic production of the 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).

As noted above and in the Initiation Notice, the petitioners requested this changed circumstances review on the basis that they are no longer interested in maintaining the countervailing duty order or in the imposition of CVD duties on the subject merchandise. Because the Department did not receive any comments during the comment period opposing initiation of this changed circumstances review, we preliminarily conclude that producers accounting for substantially all of the production of the domestic like product to which this order pertains lack interest in the relief provided by the order. In accordance with 19 CFR § 351.222(g), the Department preliminarily determines that there is a reasonable basis to believe that changed circumstances exist sufficient to warrant revocation of the order. Therefore, the Department is preliminarily revoking the order on carbon and certain alloy steel wire rod from Canada, in whole. Unless the Department receives opposition within the time limit set forth below from domestic producers whose production totals more than 15 percent of the domestic like product, the Department will revoke the order on carbon and certain alloy steel wire rod in its final results of review.

If, as a result of this review, we revoke the order, we intend to instruct 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 Order” 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 may submit case briefs not later than 14 days after the date of publication of this notice. See 19 CFR § 351.309(c)(ii). Rebuttal briefs, which must be limited to issues raised in such case briefs, may be filed not later than 19 days after the date of publication of this notice. See 19 CFR § 351.309(d). Parties who submit arguments 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. Any interested party may request a hearing within 14 days of publication of this notice. See 19 CFR § 351.310(c). Any hearing, if requested, may be held 22 days after the date of publication of this notice, or the first working day thereafter, as practicable.

Consistent with section 351.216(e) of the Department's regulations, we will issue the final results of this changed circumstances review not later than 270 days after the date on which this review was initiated.

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.