U.S. International Trade Commission

Publication 4124 January 2010

Washington, DC 20436

Certain Oil Country Tubular Goods 

from China

Investigation No. 701-TA-463 (Final)
U.S. International Trade Commission

COMMISSIONERS 

 

Shara L. Aranoff, Chairman 

Daniel R. Pearson, Vice Chairman 

Deanna Tanner Okun 

Charlotte R. Lane 

Irving A. Williamson 

Dean A. Pinkert

Robert A. Rogowsky

Staff assigned

Address all communications to 

Secretary to the Commission 

United States International Trade Commission 

Washington, DC 20436

Director of Operations

Fred Ruggles, Investigator 

Norman VanToai, Industry Analyst 

Ioana Mic, Economist 

Mary Klir, Accountant/Auditor 

Charles St. Charles, Attorney 

Douglas Corkran, Supervisory Investigator

Special assistance from

Lemuel Shields, Statistician 

Keysha Martinez Roman, Intern
U.S. International Trade Commission

Washington, DC 20436 

www.usitc.gov

Publication 4124 January 2010

Certain Oil Country Tubular Goods 

from China

Investigation No. 701-TA-463 (Final)

CONTENTS

Page

Determination ................................................................. 1

Views of the Commission ........................................................ 3

Separate views of Commissioners Charlotte R. Lane and Irving A. Williamson . . . . . . . . . . . 29

Part I: Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-1

Background ................................................................. I-1

Statutory criteria and organization of the report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-2

Statutory criteria . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-2

Organization of the report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-3

U.S. market summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-3

Summary data and data sources . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-3

Previous and related investigations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-4

Antidumping and countervailing duty investigations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-4

Safeguard investigations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-6

Nature and extent of subsidies and sales at LTFV . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-6

Subsidies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-6

Sales at LTFV . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-7

The subject merchandise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-8

Commerce’s scope . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-8

Tariff treatment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-8

The product ................................................................. I-9

Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-9

Description and applications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-10

Manufacturing processes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-14

Domestic like product issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-20

Part II: Conditions of competition in the U.S. market ............................... II-1

U.S. market characteristics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-1

Channels of distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-1

Supply and demand considerations ............................................... II-2

Supply .................................................................. II-2

Demand . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-6

Substitutability issues ......................................................... II-14

Factors affecting purchasing decisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-14

Comparisons of domestic products and subject imports ............................ II-19

Comparisons of domestic products and nonsubject imports ......................... II-21

Comparisons of subject imports and nonsubject imports ........................... II-22

Elasticity estimates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-22

U.S. supply elasticity ....................................................... II-22

U.S. demand elasticity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-22

Substitution elasticity ...................................................... II-22

i
CONTENTS

Page

Part III: U.S. producers’ production, shipments, and employment ..................... III-1

U.S. producers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . III-1

U.S. capacity, production, and capacity utilization .................................. III-6

U.S. producers’ shipments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . III-7

Order books ................................................................ III-10

U.S. producers’ inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . III-12

U.S. producers’ imports and purchases ............................................ III-12

U.S. employment, wages, and productivity ........................................ III-13

Part IV: U.S. imports, apparent consumption, and market shares . . . . . . . . . . . . . . . . . . . . . IV-1

U.S. importers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-1

U.S. imports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-3

Critical circumstances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-8

Negligibility ................................................................ IV-9

Apparent U.S. consumption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-9

U.S. market shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-10

Ratio of imports to U.S. production . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-12

Part V: Pricing and related information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-1

Factors affecting prices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-1

Raw material costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-1

U.S. inland transportation costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-1

Transportation costs to the U.S. market . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-2

Pricing practices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-3

Pricing methods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-3

Sales terms and discounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-3

Price data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-4

Price trends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-11

Price comparisons . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-12

Lost sales and lost revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-13

Part VI: Financial experience of the U.S. producers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-1

Background ................................................................. VI-1

Operations on OCTG . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-1

Variance analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-3

Capital expenditures and research and development expenses . . . . . . . . . . . . . . . . . . . . . . . . . . VI-4

Assets and return on investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-5

Capital and investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-6

ii
CONTENTS

Page

Part VII: Threat considerations and information on nonsubject countries .............. VII-1

The industry in the China ...................................................... VII-1

U.S. inventories of product from China ........................................... VII-6

U.S. importers’ current orders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VII-6

Antidumping investigations in third-country markets ................................ VII-7

Information on nonsubject countries ............................................. VII-8

Argentina . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VII-15

Austria . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VII-16

Canada . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VII-16

Colombia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VII-17

Germany . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VII-17

India . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VII-18

Japan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VII-18

Korea . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VII-19

Mexico . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VII-19

` ` Recent OCTG operations in select nonsubject countries ............................ VII-20

Appendixes

A. Federal Register notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-1

B. Hearing witnesses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-1

C. Summary data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . C-1

D. Tariff treatment of OCTG in 2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . D-1

E. Additional information concerning U.S. producers’ operations . . . . . . . . . . . . . . . . . . . . . . . . E-1

F. Nonsubject pricing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-1

G. Alleged effects of subject imports on U.S. producers’ existing development and production 

 efforts, growth, investment, and ability to raise capital and differences in the performance

 of multiple OCTG production facilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . G-1

Note.–Information that would reveal confidential operations of individual concerns may not be published

and therefore has been deleted from this report. Such deletions are indicated by asterisks.

iii
 
UNITED STATES INTERNATIONAL TRADE COMMISSION

Investigation No. 701-TA-463 (Final)

CERTAIN OIL COUNTRY TUBULAR GOODS FROM CHINA

DETERMINATION

On the basis of the record1

 developed in the subject investigation, the United States International

Trade Commission (Commission) determines, pursuant to section 705(b) of the Tariff Act of 1930 (19

U.S.C. § 1671d(b)) (the Act), that an industry in the United States is threatened with material injury by

reason of imports from China of certain oil country tubular goods (“OCTG”), primarily provided for in

subheadings 7304.29, 7305.20, and 7306.29 of the Harmonized Tariff Schedule of the United States, that

have been found by the Department of Commerce (Commerce) to be subsidized by the Government of

China.2 3

BACKGROUND

The Commission instituted this investigation effective April 8, 2009, following receipt of a

petition filed with the Commission and Commerce by Maverick Tube Corporation, Houston, TX; United

States Steel Corporation, Pittsburgh, PA; V&M Star LP, Houston, TX; V&M Tubular Corporation of

America, Houston, TX; TMK IPSCO, Camanche, IA; Evraz Rocky Mountain Steel, Pueblo, CO;

Wheatland Tube Corp., Wheatland, PA; and the United Steel, Paper, and Forestry, Rubber,

Manufacturing, Energy, Allied Industrial and Service Workers International Union, AFL–CIO–CLC,

Pittsburgh, PA. The final phase of the investigation was scheduled by the Commission following

notification of a preliminary determination by Commerce that imports of certain oil country tubular goods

from China were being subsidized within the meaning of section 703(b) of the Act (19 U.S.C.

§ 1671b(b)). Notice of the scheduling of the final phase of the Commission’s investigation and of a

public hearing to be held in connection therewith was given by posting copies of the notice in the Office

of the Secretary, U.S. International Trade Commission, Washington, DC, and by publishing the notice in

the Federal Register of September 30, 2009 (74 FR 50242). The hearing was held in Washington, DC,

on December 1, 2009, and all persons who requested the opportunity were permitted to appear in person

or by counsel.

 1 The record is defined in sec. 207.2(f) of the Commission’s Rules of Practice and Procedure (19 CFR § 207.2(f)).

 2

 Commissioners Charlotte R. Lane and Irving A. Williamson determine that the domestic OCTG industry is

materially injured by reason of imports of the subject merchandise from China.

 3

 Chairman Shara L. Aranoff, Vice Chairman Daniel R. Pearson, Commissioner Deanna Tanner Okun, and

Commissioner Dean A. Pinkert determine that they would not have found material injury but for the suspension of

liquidation.
 
VIEWS OF THE COMMISSION

Based on the record in the final phase of this investigation, we find that an industry in the United

States is threatened with material injury by reason of certain imports of oil country tubular goods

(“OCTG”) from China that are subsidized by the Government of China.1

I. BACKGROUND

The petition in this investigation was filed on April 8, 2009. The petitioners are domestic

producers Maverick Tube Corporation (“Maverick”), Houston, Texas; United States Steel Corporation

(“U.S. Steel”), Pittsburgh, Pennsylvania; V&M Star LP (“V&M”), Houston, Texas; V&M Tubular

Corporation of America, Houston, Texas; TMK IPSCO, Camanche, Iowa; Evraz Rocky Mountain Steel

(“EVRAZ”), Pueblo, Colorado; Wheatland Tube Corp. (“Wheatland”), Wheatland, Pennsylvania; and the

trade union United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and

Service Workers International Union, AFL-CIO-CLC, Pittsburgh, Pennsylvania (“Steel Workers”)

(collectively, “petitioners”). The petitioners filed prehearing and posthearing briefs and appeared at the

hearing. The Chinese producers or exporters of OCTG that filed prehearing and posthearing briefs and

appeared through counsel at the hearing include Tianjin Pipe (Group) Corporation; Baosteel Group

Corporation; Zhejiang Jianli Group; Jiangsu Changde Steel Tube Share Co., Ltd.; Wuxi Seamless Oil

Pipe Co., Ltd.; Baotou Iron & Steel (Group) Co., Ltd.; Anhui Tianda Oil Pipe Co., Ltd.; Pangang Group

Chengdu Iron & Steel Co., Ltd.; Shengli Oilfield Highland Petroleum Equipment Co., Ltd.; Jiangsu

Changbao Steel Tube Co., Ltd; Hengyang Valin Steel Tube Co., Ltd.; and Angang Steel Company

Limited (collectively, “Respondents”). 

 There are 12 mills and processors believed to be producing OCTG in the United States, of which

seven responded with usable data.2

 These questionnaire responses account for over *** percent of

domestic mill production and shipments of OCTG.3

 The Commission received usable preliminary and/or

final phase questionnaire responses from importers accounting for 77.9 percent of total U.S. OCTG

imports from China in 2008.4 5

 The Commission also received usable questionnaire responses from

16 Chinese producers/exporters, which accounted for approximately *** percent of production capacity

of OCTG and related tubular products in China during 2008, approximately 56 percent of total exports of

OCTG from China in 2009 and 66 percent of exports from China to the United States in 2008.6

 1 Commissioners Lane and Williamson determine that the domestic industry is materially injured by reason of

subject imports. See Separate Views of Commissioners Charlotte R. Lane and Irving A. Williamson. They join in

parts I-V of these Views. 

 2

 The Commission received responses from the seven petitioning firms, but several firms certified by the

American Petroleum Institute (“API”) to manufacture (Paragon Industries and Tex Tube) or process (Tejas Tubulars,

Texas Steel Conversion, and Tubular Services, LP) OCTG provided *** data. See Confidential Staff Report, INVGG-113 (“CR”) at I-3, III-1, and Table III-1; Public Staff Report (“PR”) at I-3, III-1, and Table III-1. 

 3

 CR/PR at III-1.

 4

 CR/PR at IV-1.

 5

 Ten importers that responded to the Commission’s importer questionnaire in the preliminary phase of this

investigation and the companion antidumping duty investigation did not respond in this final phase. The preliminary

phase responses of these companies, which accounted for *** percent of subject imports from China in 2008, are

reflected in the full year data in the Commission’s staff report, but no data for those companies are included among

the data for the interim periods (January - September 2008 and January - September 2009). CR/PR at IV-1 n.2. 

 6

 CR at VII-6-7, PR at VII-3-4. The coverage calculations for the Chinese industry include questionnaires

submitted less than a week before the issuance of the staff report. 

3
II. DOMESTIC LIKE PRODUCT

A. In General

In determining whether an industry in the United States is materially injured or threatened with

material injury by reason of imports of the subject merchandise, the Commission first defines the

“domestic like product” and the “industry.”7

 Section 771(4)(A) of the Tariff Act of 1930, as amended

(“the Tariff Act”), defines the relevant domestic 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.”8

 In turn, the Tariff Act defines “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 ... .”9

The decision regarding the appropriate domestic like product(s) in an investigation is a factual

determination, and the Commission has applied the statutory standard of “like” or “most similar in

characteristics and uses” on a case-by-case basis.10 No single factor is dispositive, and the Commission

may consider other factors it deems relevant based on the facts of a particular investigation.11 The

Commission looks for clear dividing lines among possible like products and disregards minor variations.12

Although the Commission must accept the determination of the U.S. Department of Commerce

(“Commerce”) as to the scope of the imported merchandise subsidized or sold at LTFV,13 the Commission

determines what domestic product is like the imported articles Commerce has identified.14

 7 19 U.S.C. § 1677(4)(A).

 8

 19 U.S.C. § 1677(4)(A).

 9

 19 U.S.C. § 1677(10).

 10 See, e.g., Cleo, Inc. v. United States, 501 F.3d 1291, 1299 (Fed. Cir. 2007); NEC Corp. v. Department of

Commerce, 36 F. Supp.2d 380, 383 (Ct. Int’l Trade 1998); Nippon Steel Corp. v. United States, 19 CIT 450, 455

(1995); Torrington Co. v. United States, 747 F. Supp. 744, 749 n.3 (Ct. Int’l Trade 1990), aff’d, 938 F.2d 1278 (Fed.

Cir. 1991) (“every like product determination ‘must be made on the particular record at issue’ and the ‘unique facts

of each case’”). The Commission generally considers a number of factors including the following: (1) physical

characteristics and uses; (2) interchangeability; (3) channels of distribution; (4) customer and producer perceptions

of the products; (5) common manufacturing facilities, production processes, and production employees; and, where

appropriate, (6) price. See Nippon, 19 CIT at 455 n.4; Timken Co. v. United States, 913 F. Supp. 580, 584 (Ct. Int’l

Trade 1996).

 11 See, e.g., S. Rep. No. 96-249 at 90-91 (1979).

 12 Nippon, 19 CIT at 455; Torrington, 747 F. Supp. at 748-49; see also S. Rep. No. 96-249 at 90-91 (1979)

(Congress has indicated that the like product standard should not be interpreted in “such a narrow fashion as to

permit minor differences in physical characteristics or uses to lead to the conclusion that the product and article are

not ‘like’ each other, nor should the definition of ‘like product’ be interpreted in such a fashion as to prevent

consideration of an industry adversely affected by the imports under consideration.”).

 13 See, e.g., USEC, Inc. v. United States, 34 Fed. Appx. 725, 730 (Fed. Cir. 2002) (“The ITC may not modify the

class or kind of imported merchandise examined by Commerce.”); Algoma Steel Corp. v. United States, 688 F.

Supp. 639, 644 (Ct. Int’l Trade 1988), aff’d, 865 F.3d 240 (Fed. Cir.), cert. denied, 492 U.S. 919 (1989).

 14 Hosiden Corp. v. Advanced Display Mfrs., 85 F.3d 1561, 1568 (Fed. Cir. 1996) (Commission may find a single

like product corresponding to several different classes or kinds defined by Commerce); Cleo, 501 F.3d at 1298 n.1

(“Commerce’s {scope} finding does not control the Commission’s {like product} determination.”); Torrington, 747

F. Supp. at 748-52 (affirming Commission determination of six like products in investigations where Commerce

found five classes or kinds).

4
B. Product Description

In its final countervailing duty determination, Commerce defined the imported merchandise

within the scope of the investigation as follows:

OCTG, which 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, regardless of end finish (e.g., whether or not plain end, threaded, or

threaded and coupled) whether or not conforming to American Petroleum Institute

(“API”) or non-API specifications, whether finished (including limited service OCTG

products) or unfinished (including green tubes and limited service OCTG products),

whether or not thread protectors are attached. The scope of the investigation also covers

OCTG coupling stock. Excluded from the scope of the investigation are casing or tubing

containing 10.5 percent or more by weight of chromium; drill pipe; unattached couplings;

and unattached thread protectors.15

OCTG are tubular steel products used in oil and gas wells and include casing, tubing, and

coupling stock of carbon and alloy steel.16 Casing is a circular pipe that serves as the structural retainer

for the walls of the well with an outside diameter (OD) ranging from 4.5 to 20 inches. Casing is used in

the well to provide a firm foundation for the drill string17 by supporting the walls of the hole to prevent

caving in both during drilling and after the well is completed. After the casing is set, concrete is usually

pumped between the outside of the casing and the wall of the hole to provide a secure anchor. Casing

also serves as a surface pipe designed to prevent contamination of the recoverable oil and gas by surface

water, gas, sand, or limestone. Casing must be sufficiently strong to carry its own weight and to resist

both external pressure and pressure within the well. Casing can be threaded at both ends and connected to

other casing pieces with couplings or connectors. Because the amount of open hole that can be drilled at

any one time is limited, a string of concentric layers of casing, rather than a single casing, is used for

larger wells. Several sizes of casing may be set inside the well after it has been drilled, with the larger

sizes set at the top of the well and the smaller sizes toward the bottom.18

Tubing is a smaller-diameter pipe (between 1.050 and 4.500 inches in OD) installed inside a

larger-diameter casing that is used to conduct the oil or gas to the surface either through natural flow or

pumping. Substances (such as lubricant) are also pumped into the well through the tubing for well

treatment. Tubing must be strong enough to support its own weight, that of the oil or gas, and that of any

pumping equipment suspended on the string.19

Coupling stock is a seamless tubular product used to make coupling blanks which, in turn, are

used to produce coupling. Only coupling stock, not coupling blanks or couplings, is within Commerce’s

scope. A coupling is a thick walled and internally threaded cylinder that is used to join two lengths of

threaded pipe. Coupling typically accounts for between 2 and 3 percent of the weight of the end-finished

 15 CR at I-9, PR at I-8. The merchandise covered by the investigation is generally classifiable under Harmonized

Tariff Schedule of the United States (“HTSUS”) subheadings 7304.29, 7305.20, and 7306.29, applicable to casing

and tubing of a kind used in drilling for oil and gas. Commerce states that OCTG coupling stock covered by the

investigation may also enter under HTSUS subheadings 7304.39 and 7304.59. CR at I-9-10 n.13, PR at I-8-9 n.13.

 16 CR at I-10-11, I-15-16; PR at I-10, I-14. 

 17 A “drill string” consists of nonsubject products, such as drill pipes, drill collars, and the drill bit. CR at I-15

n.22, PR at I-10 n.22.

 18 CR at I-15, PR at I-10.

 19 CR at I-15, PR at I-14.

5
tubing or casing. Casing, tubing, and coupling stock are all usually produced in accordance with API

specification 5CT.20

C. Analysis

In the preliminary phase of this investigation, the Commission found that all OCTG are used in

the same general application (i.e., the extraction of oil or natural gas), share common physical

characteristics, are manufactured to the same specification, and may be subjected to the same additional

finishing processes, such as heat treating, threading, hydrostatic testing, and cutting to length. Based on

these similarities, and in the absence of clear dividing lines between different types of OCTG, the

Commission found a single domestic like product, consisting of all OCTG, that is co-extensive with the

scope of the investigation.21

In this final phase of the investigation, petitioners support finding one like product that is

coextensive with the scope of the investigation, and no party objects to that domestic like product

definition. The evidence collected in the final phase of this investigation does not warrant a departure

from the Commission’s like product finding in the preliminary determination.22 Accordingly, for the

reasons stated in the preliminary determination, we find a single domestic like product, consisting of all

OCTG, that is co-extensive with the scope of the investigation.

III. DOMESTIC INDUSTRY

The domestic industry is defined as the domestic “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.”23 In defining the domestic industry, the

Commission’s general practice has been to include in the industry producers of all domestic production of

the like product, whether toll-produced, captively consumed, or sold in the domestic merchant market. 

Based on our definition of the domestic like product, we define a single domestic industry consisting of

all domestic producers of OCTG.24 25

 20 CR at I-16, I-25; PR at I-14, I-21.

 21 USITC Pub. 4081 at 4-7.

 22 Record information with respect to OCTG coupling stock reinforces our finding of a single domestic like

product. Although coupling stock and other OCTG appear to differ with respect to the channels of distribution

through which they are sold, the record does not establish clear differences in respect to the other factors we

consider. CR at I-24-26, PR at I-20-21. In light of their overall similarities, we find coupling stock and other OCTG

to be a single domestic like product. Id.

 23 19 U.S.C. § 1677(4)(A).

 24 CR/PR at Table III-1. Domestic producers of OCTG from which the Commission received questionnaire

responses include Maverick, U.S. Steel, V&M, TCA, IPSCO, Evraz, and Wheatland. CR/PR at Table III-1.

 25 We find no basis to exclude any producer from the domestic industry under the statute’s related party

provision, 19 U.S.C. § 1677(4)(A), and no party has argued that any producer should be excluded. ***.

6
IV. LEGAL STANDARDS

A. In General

In the final phase of antidumping and countervailing duty investigations, the Commission

determines whether an industry in the United States is materially injured or threatened with material

injury by reason of the imports under investigation.26 In making this determination, the Commission must

consider the volume of subject imports, their effect on prices for the domestic like product, and their

impact on domestic producers of the domestic like product, but only in the context of U.S. production

operations.27 The statute defines “material injury” as “harm which is not inconsequential, immaterial, or

unimportant.”28 In assessing whether the domestic industry is materially injured by reason of subject

imports, we consider all relevant economic factors that bear on the state of the industry in the United

States.29 No single factor is dispositive, and all relevant factors are considered “within the context of the

business cycle and conditions of competition that are distinctive to the affected industry.”30

Although the statute requires the Commission to determine whether the domestic industry is

“materially injured or threatened with material injury by reason of” unfairly traded imports,31 it does not

define the phrase “by reason of,” indicating that this aspect of the injury analysis is left to the

Commission’s reasonable exercise of its discretion.32 In identifying a causal link, if any, between subject

imports and material injury to the domestic industry, the Commission examines the facts of record that

relate to the significance of the volume and price effects of the subject imports and any impact of those

imports on the condition of the domestic industry. This evaluation under the “by reason of” standard

must ensure that subject imports are more than a minimal or tangential cause of injury and that there is a

sufficient causal, not merely a temporal, nexus between subject imports and material injury.33

In many investigations, there are other economic factors at work, some or all of which may also

be having adverse effects on the domestic industry. Such economic factors might include nonsubject

imports; changes in technology, demand, or consumer tastes; competition among domestic producers; or

management decisions by domestic producers. The legislative history explains that the Commission must

examine factors other than subject imports to ensure that it is not attributing injury from other factors to

 26 19 U.S.C. §§ 1671d(b), 1673d(b).

 27 19 U.S.C. § 1677(7)(B)( i). The Commission “may consider such other economic factors as are relevant to the

determination” but shall “identify each {such} factor ... and explain in full its relevance to the determination.” 

19 U.S.C. § 1677(7)(B).

 28 19 U.S.C. § 1677(7)(A).

 29 19 U.S.C. § 1677(7)(C)(iii).

 30 19 U.S.C. § 1677(7)(C)(iii).

 31 19 U.S.C. §§ 1671d(a), 1673d(a).

 32 Angus Chemical Co. v. United States, 140 F.3d 1478, 1484-85 (Fed. Cir. 1998) (“{T}he statute does not

‘compel the commissioners’ to employ {a particular methodology}.”), aff’d, 944 F. Supp. 943, 951 (Ct. Int’l Trade

1996).

 33 The Federal Circuit, in addressing the causation standard of the statute, observed that “{a}s long as its effects

are not merely incidental, tangential, or trivial, the foreign product sold at less than fair value meets the causation

requirement.” Nippon Steel Corp. v. USITC, 345 F.3d 1379, 1384 (Fed. Cir. 2003). This was further ratified in

Mittal Steel Point Lisas Ltd. v. United States, 542 F.3d 867, 873 (Fed. Cir. 2008), where the Federal Circuit, quoting

Gerald Metals, Inc. v. United States, 132 F.3d 716, 722 (Fed. Cir. 1997), stated that “this court requires evidence in

the record ‘to show that the harm occurred “by reason of” the LTFV imports, not by reason of a minimal or

tangential contribution to material harm caused by LTFV goods.’” See also Nippon Steel Corp. v. United States,

458 F.3d 1345, 1357 (Fed. Cir. 2006); Taiwan Semiconductor Industry Ass’n v. USITC, 266 F.3d 1339, 1345 (Fed.

Cir. 2001).

7
the subject imports, thereby inflating an otherwise tangential cause of injury into one that satisfies the

statutory material injury threshold.34 In performing its examination, however, the Commission need not

isolate the injury caused by other factors from injury caused by unfairly traded imports.35 Nor does the

“by reason of” standard require that unfairly traded imports be the “principal” cause of injury or

contemplate that injury from unfairly traded imports be weighed against other factors, such as nonsubject

imports, which may be contributing to overall injury to an industry.36 It is clear that the existence of

injury caused by other factors does not compel a negative determination.37

Assessment of whether material injury to the domestic industry is “by reason of” subject imports

“does not require the Commission to address the causation issue in any particular way” as long as “the

injury to the domestic industry can reasonably be attributed to the subject imports” and the Commission

“ensure{s} that it is not attributing injury from other sources to the subject imports.”38 39 Indeed, the

 34 SAA at 851-52 (“{T}he Commission must examine other factors to ensure that it is not attributing injury from

other sources to the subject imports.”); S. Rep. 96-249 at 75 (1979) (the Commission “will consider information

which indicates that harm is caused by factors other than less-than-fair-value imports.”); H.R. Rep. 96-317 at 47

(1979) (“in examining the overall injury being experienced by a domestic industry, the ITC will take into account

evidence presented to it which demonstrates that the harm attributed by the petitioner to the subsidized or dumped

imports is attributable to such other factors;” those factors include “the volume and prices of nonsubsidized imports

or imports sold at fair value, contraction in demand or changes in patterns of consumption, trade restrictive practices

of and competition between the foreign and domestic producers, developments in technology and the export

performance and productivity of the domestic industry”); accord Mittal Steel, 542 F.3d at 877.

 35 SAA at 851-52 (“{T}he Commission need not isolate the injury caused by other factors from injury caused by

unfair imports.”); Taiwan Semiconductor Industry Ass’n v. USITC, 266 F.3d 1339, 1345 (Fed. Cir. 2001) (“{T}he

Commission need not isolate the injury caused by other factors from injury caused by unfair imports ... . Rather, the

Commission must examine other factors to ensure that it is not attributing injury from other sources to the subject

imports.” (emphasis in original)); Asociacion de Productores de Salmon y Trucha de Chile AG v. United States, 180

F. Supp. 2d 1360, 1375 (Ct. Int’l Trade 2002) (“{t}he Commission is not required to isolate the effects of subject

imports from other factors contributing to injury” or make “bright-line distinctions” between the effects of subject

imports and other causes.); see also Softwood Lumber from Canada, Invs. Nos. 701-TA-414 and 731-TA-928

(Remand), USITC Pub. 3658 at 100-01 (Dec. 2003) (Commission recognized that “{i}f an alleged other factor is

found not to have or threaten to have injurious effects to the domestic industry, i.e., it is not an ‘other causal factor,’

then there is nothing to further examine regarding attribution to injury”), citing Gerald Metals, Inc. v. United States,

132 F.3d 716, 722 (Fed. Cir. 1997) (the statute “does not suggest that an importer of LTFV goods can escape

countervailing duties by finding some tangential or minor cause unrelated to the LTFV goods that contributed to the

harmful effects on domestic market prices.”).

 36 S. Rep. 96-249 at 74-75; H.R. Rep. 96-317 at 47.

 37 See Nippon Steel Corp., 345 F.3d at 1381 (“an affirmative material-injury determination under the statute

requires no more than a substantial-factor showing. That is, the ‘dumping’ need not be the sole or principal cause of

injury.”).

 38 Mittal Steel, 542 F.3d at 877-78; see also id. at 873 (“While the Commission may not enter an affirmative

determination unless it finds that a domestic industry is materially injured ‘by reason of’ subject imports, the

Commission is not required to follow a single methodology for making that determination ... {and has} broad

discretion with respect to its choice of methodology.”) citing United States Steel Group v. United States, 96 F.3d

1352, 1362 (Fed. Cir. 1996) and S. Rep. 96-249 at 75.

 39 Commissioner Pinkert does not join this paragraph or the following three paragraphs. He points out that the

Federal Circuit, in Bratsk, 444 F.3d 1369, and Mittal, held that the Commission is required, in certain circumstances

when considering present material injury, to undertake a particular kind of analysis of nonsubject imports. Mittal

explains as follows:

What Bratsk held is that “where commodity products are at issue and fairly traded, price-competitive,

nonsubject imports are in the market,” the Commission would not fulfill its obligation to consider an

(continued...)

8
Federal Circuit has examined and affirmed various Commission methodologies and has disavowed “rigid

adherence to a specific formula.”40

The Federal Circuit’s decisions in Gerald Metals, Bratsk, and Mittal Steel all involved cases

where the relevant “other factor” was the presence in the market of significant volumes of pricecompetitive nonsubject imports. The Commission interpreted the Federal Circuit’s guidance in Bratsk as

requiring it to apply a particular additional methodology following its finding of material injury in cases

involving commodity products and a significant market presence of price-competitive nonsubject

imports.41 The additional “replacement/benefit” test looked at whether nonsubject imports might have

replaced subject imports without any benefit to the U.S. industry. The Commission applied that specific

additional test in subsequent cases, including the Carbon and Certain Alloy Steel Wire Rod from Trinidad

and Tobago determination that underlies the Mittal Steel litigation.

Mittal Steel clarifies that the Commission’s interpretation of Bratsk was too rigid and makes clear

that the Federal Circuit does not require the Commission to apply an additional test nor any one specific

methodology; instead, the court requires the Commission to have “evidence in the record” to “show that

the harm occurred ‘by reason of’ the LTFV imports,” and requires that the Commission not attribute

injury from nonsubject imports or other factors to subject imports.42 Accordingly, we do not consider

ourselves required to apply the replacement/benefit test that was included in Commission opinions

subsequent to Bratsk.

The progression of Gerald Metals, Bratsk, and Mittal Steel clarifies that, in cases involving

commodity products where price-competitive nonsubject imports are a significant factor in the U.S.

market, the Court will require the Commission to give full consideration, with adequate explanation, to

non-attribution issues when it performs its causation analysis.43 44

The question of whether the material injury threshold for subject imports is satisfied

notwithstanding any injury from other factors is factual, subject to review under the substantial evidence

 39 (...continued)

important aspect of the problem if it failed to consider whether nonsubject or non-LTFV imports would

have replaced LTFV subject imports during the period of investigation without a continuing benefit to the

domestic industry. 444 F.3d at 1369. Under those circumstances, Bratsk requires the Commission to

consider whether replacement of the LTFV subject imports might have occurred during the period of

investigation, and it requires the Commission to provide an explanation of its conclusion with respect to

that factor.

542 F.3d at 878.

 40 Nucor Corp. v. United States, 414 F.3d 1331, 1336, 1341 (Fed. Cir. 2005); see also Mittal Steel, 542 F.3d at

879 (“Bratsk did not read into the antidumping statute a Procrustean formula for determining whether a domestic

injury was ‘by reason’ of subject imports.”).

 41 Mittal Steel, 542 F.3d at 875-79.

 42 Mittal Steel, 542 F.3d at 873 (quoting from Gerald Metals, 132 F.3d at 722), 875-79 & n.2 (recognizing the

Commission’s alternative interpretation of Bratsk as a reminder to conduct a non-attribution analysis).

 43 Commissioner Lane also refers to her dissenting views in Polyethylene Terephthalate Film, Sheet, and Strip

from Brazil, China, Thailand, and the United Arab Emirates, Invs. Nos. 731-TA-1131 to 1134 (Final), USITC Pub.

4040 (Oct. 2008), for further discussion of Mittal Steel.

 44 To that end, after the Federal Circuit issued its decision in Bratsk, the Commission began to present published

information or send out information requests in final phase investigations to producers in nonsubject countries that

accounted for substantial shares of U.S. imports of subject merchandise (if, in fact, there were large nonsubject

import suppliers). In order to provide a more complete record for the Commission’s causation analysis, these

requests typically seek information on capacity, production, and shipments of the product under investigation in the

major source countries that export to the United States. The Commission plans to continue utilizing published or

requested information in final phase investigations in which there are substantial levels of nonsubject imports.

9
standard.45 Congress has delegated this factual finding to the Commission because of the agency’s

institutional expertise in resolving injury issues.46

B. Material Injury by Reason of Subject Imports

In evaluating the volume of subject imports, section 771(7)(C)(I) of the Tariff Act provides that

the “Commission shall consider whether the volume of imports of the merchandise, or any increase in that

volume, either in absolute terms or relative to production or consumption in the United States, is

significant.”47

In evaluating the price effects of the subject imports, section 771(7)(C)(ii) of the Tariff Act

provides that the Commission shall consider whether –

 (I) there has been significant price underselling by the imported merchandise as

compared with the price of domestic like products of the United States, and

 (II) the effect of imports of such merchandise otherwise depresses prices to a significant

degree or prevents price increases, which otherwise would have occurred, to a significant

degree.48

In examining the impact of subject imports, section 771(7)(C)(iii) of the Tariff Act provides that

the Commission “shall evaluate all relevant economic factors which have a bearing on the state of the

industry.”49 These factors include output, sales, inventories, ability to raise capital, research and

development, and factors affecting domestic prices. No single factor is dispositive and all relevant factors

are considered “within the context of the business cycle and conditions of competition that are distinctive

to the affected industry.”50

C. Threat of Material Injury by Reason of Subject Imports

Section 771(7)(F) of the Tariff Act directs the Commission to determine whether the U.S.

industry is threatened with material injury by reason of the subject imports by analyzing whether “further

dumped or subsidized imports are imminent and whether material injury by reason of imports would

occur unless an order is issued or a suspension agreement is accepted.”51 The Commission may not make

such a determination “on the basis of mere conjecture or supposition,” and considers the threat factors “as

a whole” in making its determination whether dumped or subsidized imports are imminent and whether

 45 We provide in our respective discussions of volume, price effects, and impact a full analysis of other factors

alleged to have caused any material injury experienced by the domestic industry.

 46 Mittal Steel, 542 F.3d at 873; Nippon Steel Corp., 458 F.3d at 1350, citing U.S. Steel Group, 96 F.3d at 1357;

S. Rep. 96-249 at 75 (“The determination of the ITC with respect to causation is ... complex and difficult, and is a

matter for the judgment of the ITC.”).

 47 19 U.S.C. § 1677(7)(C)(i).

 48 19 U.S.C. § 1677(7)(C)(ii).

 49 19 U.S.C. § 1677(7)(C)(iii); see also SAA at 851 and 885 (“In material injury determinations, the Commission

considers, in addition to imports, other factors that may be contributing to overall injury. While these factors, in

some cases, may account for the injury to the domestic industry, they also may demonstrate that an industry is facing

difficulties from a variety of sources and is vulnerable to dumped or subsidized imports.”). 

 50 19 U.S.C. § 1677(7)(C)(iii); see also SAA at 851, 885; Live Cattle from Canada and Mexico, Inv. Nos. 701-

TA-386, 731-TA-812-813 (Preliminary), USITC Pub. 3155 at 25 n.148 (Feb. 1999).

 51 19 U.S.C. § 1677(7)(F)(ii).

10
material injury by reason of subject imports would occur unless an order is issued.52 In making our

determination, we consider all statutory threat factors that are relevant to this investigation.53

V. CONDITIONS OF COMPETITION AND THE BUSINESS CYCLE

The following conditions of competition inform our analysis of whether there is material injury or

threat of material injury by reason of subject imports.

 52 19 U.S.C. § 1677(7)(F)(ii).

 53 These factors are as follows:

(I) if a countervailable subsidy is involved, such information as may be presented to it by the administering

authority as to the nature of the subsidy (particularly as to whether the countervailable subsidy is a subsidy

described in Article 3 or 6.1 of the Subsidies Agreement) and whether imports of the subject merchandise

are likely to increase,

(II) any existing unused production capacity or imminent, substantial increase in production capacity in the

exporting country indicating the likelihood of substantially increased imports of the subject merchandise

into the United States, taking into account the availability of other export markets to absorb any additional

exports,

(III) a significant rate of increase of the volume or market penetration of imports of the subject merchandise

indicating the likelihood of substantially increased imports,

(IV) whether imports of the subject merchandise are entering at prices that are likely to have a significant

depressing or suppressing effect on domestic prices and are likely to increase demand for further imports,

(V) inventories of the subject merchandise,

(VI) the potential for product-shifting if production facilities in the foreign country, which can be used to

produce the subject merchandise, are currently being used to produce other products.

* * *

(IX) any other demonstrable adverse trends that indicate the probability that there is likely to be material

injury by reason of imports (or sale for importation) of the subject merchandise (whether or not it is actually

being imported at the time).

19 U.S.C. § 1677(7)(F)(i). To organize our analysis, we discuss the applicable statutory threat factors using the

same volume/price/impact framework that applies to our material injury analysis. Statutory threat factors (I), (II),

(III), (V), and (VI) are discussed in the analysis of subject import volume. Statutory threat factor (IV) is discussed in

the price effects analysis, and statutory threat factor (IX) is discussed in the impact analysis. Statutory threat factor

(VII) is inapplicable, as no imports of agricultural products are involved in this investigation. No argument was

made that the domestic industry is currently engaging or will imminently engage in any efforts to develop a

derivative or more advanced version of the domestic like product, which would implicate statutory threat factor

(VIII).

11
A. Demand Conditions

Because OCTG is used in the extraction of oil and natural gas, overall demand for OCTG is

closely linked to demand for those products.54 U.S. demand for OCTG is often gauged by the number of

active rigs employed in the United States in oil drilling or (primarily) natural gas drilling, as well as the

depth of those rigs.55 The record indicates that changes in the price of OCTG will likely result in only a

small change in the quantity of OCTG demanded.56 

Demand for OCTG is cyclical and has experienced sharp and frequent fluctuations over the past

two decades.57 OCTG demand was strong in 2006 and 2007, peaked in the second half of 2008, and

declined rapidly thereafter through mid-2009. Specifically, OCTG demand measured by the number of

oil and natural gas rigs increased fairly steadily from about 1,500 active rigs at the beginning of 2006 to a

peak of more than 2,000 rigs in September 2008. The rig count thereafter declined steeply, to a low of

about 900 rigs in June 2009. The rig count was about 1,000 rigs in September 2009, half of the count in

September 2008.58 The rise in demand was amplified by speculative purchases,59 which then contributed

to the sudden fall in orders that occurred as market participants generally failed to anticipate the collapse

in demand late in the period examined.60

When measured by apparent U.S. consumption, U.S. OCTG demand declined from 4.74 million

short tons in 2006 to 4.11 million short tons in 2007, then increased to 6.72 million short tons in 2008, for

an overall increase of 41.9 percent between 2006 and 2008. Apparent U.S. consumption was 2.00 million

short tons in interim (January-September) 2009, 55.2 percent lower than in interim 2008, when apparent

 54 CR at I-11, I-15-16; PR at I-10, I-14.

 55 CR at II-15, PR at II-9. Demand is affected also by the depth of the active rigs because deeper wells require

both more OCTG footage and larger diameter casing toward the well top. Id. Data on footage of oil and natural gas

wells drilled between 2006 and March 2009 are shown at CR/PR at Figure II-3. The record also includes published

data on consumption by OCTG operators. CR/PR at Figure II-2.

 56 The main factors contributing to the small degree of responsiveness of demand to price changes are the lack of

substitutability of other products for OCTG and the small to moderate share of total drilling costs reflected by

OCTG. CR at II-10, PR at II-6.

 57 The trend in OCTG demand in the United States from 1990 to November 2009, measured by the number of

operating oil and gas rigs, is shown at CR/PR at Figure II-7. See also Baker Hughes Incorporated Worldwide Rig

Count (worksheet filed by Ioana Mic, Doc. No. 415733) (hereinafter “Baker Hughes Rig Count”). 

 58 E.g., CR/PR at Figures II-4-5, Baker Hughes Rig Count. The rig count trend is consistent with the trend for

OCTG consumption by OCTG operators, which peaked in the fall of 2008 then declined steeply through mid-2009. 

CR/PR at Figure II-2. That trend is also consistent with the trend for the footage of oil and natural gas wells drilled

between 2006 and September 2009, with footage peaking in 2008; the footage drilled was then lower in interim

(January-September) 2009 than in the comparable period in 2008. CR/PR at Figure II-3. Similarly, weightedaverage prices for U.S.-produced OCTG fluctuated within a narrow range during 2006 and 2007, then increased in

the last three quarters of 2008 by over $1,000 per short ton before declining in 2009. CR at V-19, PR at V-11,

CR/PR at Tables V-2 - V-7.

 59 Hearing Transcript (Tr.) at 153-54 (Hausman), 318-19 (Dunn); U.S. Steel’s Posthearing Brief at Exhibit 11,

Attachments A & B. See also Conference Transcript at 177-78 (Hausman) (noting that there was “a good deal of

speculat[ive] demand” by purchasers in expectation of higher prices, and that, after rig counts fell, the “great

increase in inventory led to a drop off to near zero of order books”), 76 (Balkenende) (“We did see a number of

customers asking for quadruple the quantities they used to buy, for whatever opportunities they may have seen in the

market.”).

 60 Conference Transcript at 167 (Reece) (“I think all mills were caught off guard by the collapse in 

demand . . . ”); CR at II-11-13, PR at II-7-8 (eleven importers reported limited or no ability to forecast OCTG

demand with accuracy at the end of 2008). *** reported they were unable to forecast the demand decline. CR at

II-11, PR at II-7. 

12
U.S. consumption was 4.47 million short tons.61 The data on apparent U.S. consumption, however,

include OCTG still being held as inventories by importers and purchasers. Those inventories surged in

late 2008 as demand declined and remained at elevated levels, both absolutely and, in particular, relative

to operator consumption, into the autumn of 2009.62 

Oil and natural gas prices are also market indicators of oil and natural gas production activity. A

considerable drop in oil and natural gas prices began around June 2008, following an unusually high

peak,63 and thus preceded other indicators of declining demand for OCTG. The record indicates that oil

and natural gas prices in the United States will increase somewhat in the imminent future but will remain

well below their mid-2008 peak.64 65 Continuing low oil and natural gas prices, along with the

accumulated inventories mentioned above, are likely to suppress demand for OCTG in the coming

months. 

The weakening OCTG market is not unique to the United States. The global economic downturn

has caused a decline in global demand for oil and natural gas since the third quarter of 2008.66

B. Supply Conditions

The three sources of OCTG supply in the U.S. market are domestic shipments, imports of subject

merchandise from China, and imports from nonsubject countries.

The seven domestic producers that responded to the Commission’s producers’ questionnaire,

most of which produce OCTG in multiple locations, accounted for the large majority of domestic

production and more than *** percent of U.S. mill OCTG operations.67 Domestic producers’ shipments

fluctuated during the period examined and increased overall by 6.5 percent from 2006 to 2008. Domestic

producers’ shipments in interim 2009 were 69.6 percent lower than in interim 2008.68 The market share

 61 CR/PR at Table C-1.

 62 CR at II-9, PR at II-5; CR/PR at Table VII-6, Figure II-1 (data on inventories of importers, distributors, and end

users are presented infra).

 63 CR/PR at Figure II-6.

 64 CR/PR at Figure II-6. The rig count has increased slowly since July 2009 and, following the period for which

data were collected for this investigation, was at about 1,100 rigs in November 2009. CR/PR at Figure II-4. The

parties appear to agree that there will likely be some increase in demand in the future. See Tr. at 143 (Hausman),

Respondents’ Prehearing Brief at 7.

 65 CR at II-14, PR at II-8-9. Respondents assert that a large share of natural gas drilling in the imminent future

will be directed to wells in shale plays and that drilling such wells requires specialized product that is primarily

available from Chinese producers. Respondents’ Posthearing Brief at Exhibit 1 pp. 3-7. Natural gas drilling in shale

plays reportedly has been increasing in recent years and is projected to increase further in the imminent future. 

Petitioners and Respondents have provided divergent estimates of the share of present and future OCTG

consumption that is or will be accounted for by shale well drilling. Id. Nevertheless, we note that both domestic

producers and Chinese producers report that they can and do service U.S. shale drilling with the OCTG they

produce. E.g., Maverick’s Posthearing Brief at 9-10, U.S. Steel’s Posthearing Brief at 13-14, Respondents’

Posthearing Brief at Exhibit 1 pp. 6-8. Accordingly, we do not believe that the relative share of demand for OCTG

used in shale wells in total demand for OCTG makes a meaningful difference to our assessment of likely future

demand conditions.

 66 CR at II-14-15, PR at II-9; see also CR/PR at Table VII-12.

 67 CR at I-3-4, PR at I-3; CR/PR at Table III-1. 

 68 CR/PR at Table C-1. 

13
held by domestic producers’ shipments dropped from 59.2 percent in 2006 to 44.4 percent in 2008, and

was 49.9 percent in interim 2008 but only 33.9 percent in interim 2009.69

The volume of subject imports increased from 725,027 short tons in 2006 to 860,711 short tons in

2007, then increased sharply to 2.20 million short tons in 2008, for an overall increase between 2006 and

2008 of 203.1 percent. The market share of subject imports increased from 15.3 percent in 2006 to

32.7 percent in 2008. Although the volume of subject imports was 40.0 percent lower in interim 2009, at

739,659 short tons, than in interim 2008, at 1.23 million short tons, apparent U.S. consumption was

55.2 percent lower in interim 2009 than in interim 2008.70 Consequently, the market share of subject

imports was higher in interim 2009, at 37.0 percent, than in interim 2008, at 27.6 percent.71 

Nonsubject imports were supplied by many countries, including Korea, Canada, and Germany.72

Consistent with trends in consumption, nonsubject imports declined from 1.20 million short tons in 2006

to 864,612 short tons in 2007, before increasing to 1.53 million short tons in 2008, for an overall increase

of 27.4 percent between 2006 and 2008. Nonsubject imports were 42.1 percent lower in interim 2009, at

583,130 short tons, than in interim 2008, at 1.01 million short tons.73

Largely due to strong real and perceived demand for OCTG prior to the fourth quarter of 2008,

five of seven responding domestic producers and 12 of 31 responding importers reported problems with

their ability to supply all the OCTG their customers ordered during the period examined. Individual

producers and importers reported extending lead times, placing purchasers on allocation, or declining to

fill orders, particularly during portions of 2008.74

The ending inventories of purchasers and importers, which increased sharply in late 2008 and into

2009, account for a significant share of current available supply. Published data on distributor and end

user inventories indicate that these inventories hovered between 2.0 and 2.5 million short tons from

January 2006 to June 2008, climbed to about 3.8 million short tons in March 2009, then declined over the

remainder of 2009. These inventories equaled less than six months of supply for extended portions of

2006 and 2008 and between six and seven months of supply for most of 2007, but were equivalent to

between 10.2 and 16.3 months of supply in the first nine months of 2009.75 76

 69 CR/PR at Table C-1. 

 70 U.S. imports from China were far higher in January, February, and March of 2009 than in those same months

of 2006, 2007, or even 2008, and in May 2009 they were comparable to the level of imports in May 2007 and 2008. 

Only beginning in June 2009 did monthly U.S. imports from China consistently decrease appreciably from the levels

reported in the same months in prior years. CR/PR at Table IV-4.

 71 CR/PR at Tables IV-2, C-1.

 72 CR/PR at Table IV-3.

 73 CR/PR at Table IV-2, C-1. U.S. antidumping duty orders on OCTG from Argentina, Italy, Japan, Korea, and

Mexico, which were issued in 1995, were in effect for part of the period examined in this investigation. Those

orders were revoked by Commerce on June 22, 2007, based on negative Commission determinations in the second

five-year reviews of the orders. 72 Fed. Reg. 34442 (Jun. 22, 2007). Subsequently, Commerce identified the

effective date of revocation of the order on OCTG from Mexico as August 11, 2000, based on a NAFTA panel’s

decision regarding Commerce’s determination in its first five-year review of the order on Mexico. 72 Fed. Reg.

55747 (Oct. 1, 2007).

 74 CR at II-3-6, PR at II-3.

 75 CR/PR at Figure II-1 and Table II-2. Purchasers that responded to the Commission’s questionnaire reported

that their end-of-period inventories were 660,220 short tons in 2006, 607,713 short tons in 2007, and 1.06 million

short tons in 2008. Responding purchasers’ inventories were 845,993 short tons in interim 2008 and 861,818 short

tons in interim 2009. CR at II-9, PR at II-5. End-of-period inventories of responding importers increased from ***

short tons in 2006 to *** short tons in 2007, then surged to *** short tons in 2008. Importers’ reported inventories

remained at *** short tons in September 2009. CR/PR at Table VII-6 (totals are for imports from all sources). The

(continued...)

14
The record indicates that the increase in import supply was facilitated in part by the growth in the

number of importers willing to participate in the OCTG market as OCTG prices increased in response to

increasing demand.77 It appears, moreover, that the increase in purchasers’ inventories, at least in late

2008, occurred as market participants, who had failed to anticipate the sudden and steep decline in

demand, received orders they had placed when demand was high and supply was tight earlier in 2008.78

C. Interchangeability

There is a high degree of interchangeability among the domestic like product, subject imports,

and nonsubject imports. Nearly all responding domestic producers reported that the domestic like

product, subject imports, and nonsubject imports are always interchangeable.79 A majority of responding

importers and purchasers reported that the domestic like product, subject imports, and nonsubject imports

are always or frequently interchangeable.80 A majority of responding purchasers also reported that the

U.S. product, subject imports, and nonsubject imports always or usually meet purchasers’ minimum

quality specifications.81 Purchasers reported that price is an important consideration in their purchasing

decisions.82 A majority of domestic producers reported that differences other than price among the

domestic like product, subject imports, and nonsubject imports are never significant, while a majority of

importers and purchasers reported that such differences are only sometimes or never significant.83

D. Other Conditions

Domestically produced and imported OCTG are sold mainly through distributors. More than

99 percent of domestic OCTG were sold to distributors. U.S. importers sold more than 90 percent of

subject imports from China to distributors in 2006, 2007, and interim 2009, and sold 84 percent to

distributors in 2008.84 Distributors stock multiple OCTG products for resale to rig operators. When

prices are rising, distributors benefit by selling OCTG at prices higher than their purchase prices. When

prices are falling, distributor inventories lose value. Thus, distributors have an incentive to build

 75 (...continued)

importer inventory data are understated for the interim periods because, as noted above, interim data are not

available for ten importers that responded in the preliminary phase of this investigation but not in this final phase. 

CR/PR at IV-1 n.2.

 76 When measured in months of supply, inventories are a function of the absolute volume held in inventory and

the rate of consumption. Accordingly, as consumption fell during interim 2009, inventories as measured in months

of supply continued to increase even after absolute inventories began to decline. See CR/PR at Figure II-1.

 77 Conference Transcript at 62 (Dewan) (“During the summer of 2008 . . . there were many people trading in

Chinese OCTG that had been out of the OCTG market for several years and others who, to my knowledge, had

never been in the OCTG business. The market became chaotic and it appeared there was unlimited supply of OCTG

from China . . . available.”). 

 78 CR at II-12-13, PR at II-8 (some purchasers reported purchasing from foreign mills, including those in China,

because they could not find sufficient supply). 

 79 CR/PR at Table II-7 (one responding producer reported that the U.S. product is frequently interchangeable with

OCTG from other countries). 

 80 CR/PR at Table II-7. 

 81 CR/PR at Table II-4.

 82 CR/PR at Table II-5.

 83 CR/PR at Table II-8. 

 84 CR/PR at II-1. 

15
inventories when they believe prices will rise, as they did until September 2008, and to work off existing

inventories and avoid new purchases when they expect prices and demand to fall, as they did after

September 2008.

VI. MATERIAL INJURY AND THREAT OF MATERIAL INJURY BY REASON OF

SUBJECT IMPORTS85

Based on the record in the final phase of this investigation, we find that an industry in the United

States is threatened with material injury by reason of imports of OCTG from China that Commerce has

found are subsidized.86

A. Volume of the Subject Imports87 88

1. Analysis of Material Injury by Reason of Subject Imports

In absolute terms, the volume of subject imports increased from 725,027 short tons in 2006 to

860,711 short tons in 2007 and 2.20 million short tons in 2008. Thus, the volume of subject imports

increased by 203.1 percent from 2006 to 2008. Subject imports were 40.0 percent lower in interim 2009,

at 739,659 short tons, than in interim 2008, at 1.23 million short tons.89

In terms of market penetration, subject imports increased consistently over time regardless of

whether demand was rising or falling.90 From 2006 to 2007, apparent U.S. consumption fell by

13.3 percent, whereas the volume of subject imports increased by 18.7 percent. From 2007 to 2008,

apparent U.S. consumption rose by 63.6 percent, whereas the volume of subject imports increased by

 85 Negligibility under 19 U.S.C. § 1677(24) is not an issue in this investigation. Official statistics from

Commerce indicate that, from April 2008 to March 2009, which is the most recent 12-month period preceding the

filing of the petition for which data were available, subject imports from China accounted for 60.0 percent of total

U.S. imports of OCTG. CR at IV-10, PR at IV-9. The volume of subject imports is thus well above the statute’s

three percent negligibility level. 

 86 As noted above, Commissioners Lane and Williamson determine that the domestic industry is materially

injured by reason of subject imports. See Separate Views of Commissioners Charlotte R. Lane and Irving A.

Williamson. 

 87 In its final countervailing duty determination on OCTG from China, Commerce found eleven programs to be

countervailable. On the basis of these programs, Commerce found countervailable subsidy margins ranging from

10.36 percent to 15.78 percent. CR at I-8, PR at I-7. At least one of the programs is intended to benefit exportation. 

Id. In its preliminary antidumping duty determination on OCTG from China, Commerce found dumping margins

ranging from 0.00 to 90.14 percent. CR at I-9, PR at I-8. 

 88 We are currently making a final determination only in the countervailing duty investigation of OCTG from

China and are scheduled to make our final antidumping duty determination in May 2010. We note that we crosscumulate the allegedly dumped imports with the subsidized imports. Cross cumulation is the cumulation of

subsidized imports with dumped imports and includes the situation in which the dumped and subsidized imports are

one and the same as well as the situation in which they differ to some extent. See Bingham & Taylor v. United

States, 815 F. 2d 1482 (Fed. Cir. 1987). See also Softwood Lumber from Canada, Inv. Nos. 701-TA-414 (Final) and

731-TA-928 (Final), USITC Pub. 3509 (May 2002) at 29; Circular Welded Carbon Quality Steel Line Pipe from

China, Inv. No. 731-TA-1149 (Final), USITC Pub. 4075 (May 2009) at 4. We note that the cumulated imports

found to be subsidized and sold at less than fair value were the subject of investigations that resulted from petitions

filed the same day, none of the exceptions to cumulation noted at 19 U.S.C. § 1677(7)(g)(ii) apply, and there is no

dispute that the dumped and subsidized imports compete with each other and the domestic like product. 

 89 CR/PR at Table C-1. 

 90 CR/PR at Table C-1. 

16
155.3 percent. Apparent U.S. consumption was 55.2 percent lower in interim 2009 than in interim 2008,

whereas subject imports in interim 2009 were only 40.0 percent below their interim 2008 level. As a

result, the market share held by subject imports increased from 15.3 percent in 2006 to 32.7 percent in

2008, and was higher in interim 2009, at 37.0 percent, than in interim 2008, when it was 27.6 percent.91

As subject imports’ market share rose, that of the domestic producers fell from 59.2 percent in 2006 to

44.4 percent in 2008. Domestic producers’ market share also was lower in interim 2009, at 33.9 percent,

than in interim 2008, when it was 49.9 percent.92 Accordingly, we find the volume of subject imports to

be significant both in absolute terms and relative to consumption in the United States.

In arguing that the subject volume is not significant, Respondents assert that the volume of

subject imports merely followed demand conditions in the United States over the period of investigation. 

More specifically, they assert that the volume of subject imports rose from 2006 to 2008, when demand

was generally rising, and fell during interim 2009 as demand was falling. The record, however, does not

confirm Respondents’ assertion.

Considering first the period 2006 to 2008, the record shows that apparent U.S. consumption fell

from 2006 to 2007, before rising sharply in 2008. The volume of subject imports, however, increased

from 2006 to 2007, and again from 2007 to 2008. As a result, subject imports gained in market share in

2007 and again in 2008.93 Accordingly, the record contradicts Respondents’ assertion that during 2006 to

2008, the volume of subject imports simply increased from 2006 to 2008 in tandem with increased

demand. 

The record also contradicts Respondents’ account of events during interim 2009. In particular, 

Respondents argue that subject imports increased in market share due to the abrupt fall in demand that

occurred in late 2008 and the lag time between importers’ placement of orders with producers in China

and the arrival of the imports in the U.S. market. We agree that there is an apparent lag of several months

for made-to-order OCTG from China and that some orders placed during the tight market conditions of

mid-2008 were arriving in U.S. ports in late 2008 and early 2009.94 It does not appear, however, that the

delay between the time subject imports are ordered and the time they arrive in the U.S. market fully

explains the pattern of subject import volumes in interim 2009. Although all parties agree that demand

plunged abruptly in September of 2008, the monthly volume of subject imports remained relatively high

as late as May 2009, eight months later.95 Accordingly, the record does not confirm Respondents’ view

that the volume of subject imports merely followed demand trends, albeit with a lag. Instead, the record

 91 CR/PR at Table C-1. The ratio of subject imports to domestic production increased even more substantially,

growing from 24.6 percent in 2006 to 34.3 percent in 2007 and 71.3 percent in 2008. The ratio of subject imports to

U.S. production was 54.4 percent in interim 2008 and 121.9 percent in interim 2009. CR/PR at Table IV-8.

 92 CR/PR at Table C-1. The market share of nonsubject imports was 25.4 percent in 2006, 21.1 percent in 2007, 

and 22.8 percent in 2008. It was 22.5 percent in interim 2008 and 29.2 percent in interim 2009. Id. 

 93 CR/PR at Table C-1.

 94 An importer with over 25 years of experience in the business (Tr. at 244) testified on behalf of Respondents as

to the duration of the lag during 2008, when demand peaked. He indicated that, during that period, the lag from

placing the order to the arrival of the subject merchandise in the United States was generally 5 months. He added

that for some orders the delay extended to six or seven months. Tr. at 248-49 (Mr. Jordan). Reports from purchasers

were generally consistent, although some reported lags that were shorter than 5 months, and others reported lags that

were longer. Purchasers’ Questionnaire responses at III-21b; see also CR at II-27 (27 of 48 reporting purchasers

reported normal lag times that averaged over 3 months, whereas 12 of 48 purchasers reported lag times that averaged

over 4 months “during periods of high demand”). 

 95 CR/PR at Table IV-4 (showing subject imports in May 2009 to be higher than in all but one of the months from

January 2006 to May 2008). In fact, subject import volumes in May 2009 were approximately twice as high as in

April 2009, contrary to the suggestion that the volume of subject imports simply followed demand downward with a

lag. Id. 

17
shows that high volumes of subject imports continued to enter the U.S. market well after the period that

Respondents’ theory would suggest. 

Respondents also claim that subject imports have now exited the market in response to the severe

drop in demand beginning in the third quarter of 2008.96 In considering Respondents’ assertion, we note

first that, although the Chinese producers did respond to some extent to changing demand, the market

share of subject imports nonetheless increased steadily over the period examined regardless of whether

demand was increasing or decreasing. With respect to Respondents’ explanation for the very low volume

of subject imports in recent months, we note that the monthly volumes declined to this level only after the

antidumping duty and countervailing duty petitions were filed.97 Notably, the virtual absence of subject

imports in these recent months stands in stark contrast to the relatively substantial presence of nonsubject

imports in that same time frame.98 We also take account of numerous press accounts and statements on

behalf of Chinese producers indicating that the recent drop in subject imports is related to the pending

investigations.99 Based on the record evidence, we find that the near cessation of subject imports at the

end of the period examined resulted from the pendency of this investigation and the companion

antidumping duty investigation on OCTG from China,100 as well as the slump in OCTG demand. Absent

these investigations, the absolute and relative volumes of subject imports would likely have been greater

in interim 2009. Moreover, we determine likely behavior in the imminent future based on data for the

entire period examined, not simply the behavior in the final months of the period. Based on the above

information, we find the volume of subject imports during the period examined, both on an absolute basis

and relative to apparent U.S. consumption and production, to be significant. 

2. Analysis of Threat of Material Injury by Reason of Subject Imports

We begin our analysis of the likely future volume of subject imports by noting, as discussed

above, that the market penetration of subject imports increased consistently during the period examined. 

In addition, we have analyzed the likely future volume of imports in the context of past and expected

demand for OCTG in the U.S. market. As noted previously, demand for OCTG fell sharply during the

second half of 2008 and continued to decline through mid-2009. Although demand increased somewhat

in the final months of the period examined and is predicted to increase modestly by the end of 2010,

consumption is projected to remain at a much lower level than its peak in 2008, or even its level in 2006

and 2007. 

Moreover, as noted above, the extent to which OCTG supply exceeded OCTG demand in 2008

and 2009 resulted in a sharp increase in inventories held by importers and purchasers at the end of the

period examined.101 These inventories would be sufficient to supply several months of demand without

resort to new domestic supply or imports from any source.102 We note too that the contemporaneous

occurrence of peak subject imports and peak inventory levels in 2008 indicates that purchases of subject

 96 Respondents’ Prehearing Brief at 5, 7-8. 

 97 CR/PR at Table IV-4.

 98 CR/PR at Table IV-4. 

 99 E.g., U.S. Steel’s Prehearing Brief at 6-8, TMK IPSCO et al. Prehearing Brief at 2-3.

 100 See 19 U.S.C. § 1677(7)(I).

 101 CR at II-9, PR at II-5; CR/PR at Figure II-1, Table VII-6. 

 102 Market participants prefer to see inventories in the United States at or below six months of supply. CR at II-7,

PR at II-4. The inventories of distributors and end users alone, however, were at 11.8 months of supply at the end of

the period examined (September 2009) and 10.9 months in October 2009. CR/PR at Table II-2. We note that these

figures represent the aggregate quantities held in inventory.

18
imports contributed to the significant inventory build-up that occurred in 2008.103 Those inventories

remain high and will likely exert downward pressure on orders for the domestic like product, as well as

domestic prices, in the imminent future.104 Because of lower projected demand and high inventory levels,

we believe that the absolute volume of purchases from all sources will be lower in the imminent future

than it was during the period examined. Nevertheless, for the reasons discussed below, we find that

subject imports will likely increase significantly in the imminent future, albeit not to the extremely high

levels seen during the preceding period of high demand (2008). 

 OCTG producers in China will likely have the ability to increase shipments to the United States

to a great extent. China is the world’s leading producer of OCTG, accounting for an estimated *** of

world production in 2007.105 The Chinese producers that responded to the Commission’s questionnaire

report that their allocated OCTG capacity increased from 5.87 million short tons in 2006 to 6.07 million

short tons in 2007 and 7.42 million short tons in 2008.106 The Chinese industry’s capacity was higher in

interim 2009, at 4.86 million short tons, than in interim 2008, at 4.80 million short tons.107 Various

Chinese producers report that they have added capacity in 2009 or will be adding capacity in 2010,

increases that appear unrelated to the current demand environment globally.108 Thus, the Chinese industry

has demonstrated an ability to increase capacity substantially in a short period of time, and this trend is

likely to continue unabated in the imminent future. Moreover, inasmuch as the reporting producers

account for only *** percent of Chinese capacity for production of OCTG and related tubular products,109

actual OCTG capacity in China is likely substantially higher than that of the responding producers.110 111

 103 The share of purchasers’ end-of-period inventories accounted for by imports from China increased from

13.6 percent in 2006 to 18.5 percent in 2007 and 32.6 percent in 2008. Imports of OCTG from China accounted for

33.6 percent of purchasers’ end-of-period inventories in interim 2008 and 35.9 percent in interim 2009. CR at II-9,

PR at II-5.

 104 CR/PR at Table III-7

 105 CR at VII-3, PR at VII-2; CR/PR at Table VII-1.

 106 CR/PR at Table VII-4.

 107 CR/PR at Table VII-4.

 108 CR at VII-2, PR at VII-1-2; CR/PR at Tables VII-2, VII-4. Respondents did not offer, nor does the record

otherwise suggest, evidence that the global recession and accompanying credit crisis have resulted in anything more

than limited cancellations of these projects. One exception appears to be ***, which reportedly has been placed on

hold indefinitely due to market conditions and environmental issues. CR at VII-7 n.28, PR at VII-4 n.28.

 109 CR at VII-6-7, PR at VII-3-4.

 110 Although we find that actual OCTG capacity in China is likely substantially higher than that reported by the

producers that responded to our foreign producers questionnaire, CR/PR Table VII-4, our analysis relies largely

upon the data for those producers. We note, however, that both the capacity reported by responding producers, as

well as the capacity reported by members of the China Steel Pipe Association (CR at VII-13, PR at VII-6), yield

fairly conservative capacity totals compared with some other sources for Chinese capacity on the record. See, e.g.,

Maverick’s Prehearing Brief at 63 (estimate of capacity ***); CR at VII-2, PR at VII-1-2 (World Steel Association

reports actual production of all tubular products in China of 45 million short tons in 2007).

 111 Commissioner Okun notes that the statute authorizes the Commission to take adverse inferences but such

authorization does not relieve the Commission of its obligation to consider the record evidence as a whole in making

its determination. See 19 U.S.C. § 1677e. She generally gives credence to the facts supplied by the participating

parties and certified by them as true, but bases her decision on the evidence as a whole, and does not automatically

accept participating parties’ suggested interpretations of the record evidence. Regardless of the level of

participation, the Commission is obligated to consider all evidence relating to each of the statutory factors and may

not draw adverse inferences that render such analysis superfluous. “In general, the Commission makes

determinations by weighing all of the available evidence regarding a multiplicity of factors relating to the domestic

(continued...)

19
Chinese producers also reported that their production increased from 4.89 million short tons in

2006 to 5.00 million short tons in 2007 and 6.40 million short tons in 2008, but was lower in interim

2009, at 3.36 million short tons, than in interim 2008, at 3.80 million short tons.112 Accordingly,

31.0 percent of the responding Chinese producers’ capacity was unused in interim 2009, meaning that,

based solely on existing capacity at the end of the period examined, these producers have the ability to

produce approximately two million short tons over their 2008 level, an additional quantity nearly

equivalent to total U.S. imports from China in 2008.113 Again, because the Commission received data

from producers accounting for only about *** of Chinese production capacity for OCTG and related

tubular products, actual unused capacity is likely substantially larger than that of the responding

producers. 

Additionally, the rise in inventories of OCTG in China would permit Chinese producers to

increase exports to the United States substantially. Chinese producers’ end-of-period inventories

increased from *** short tons in 2006 to *** short tons in 2008, and were *** short tons in interim 2008

and *** short tons in interim 2009. Chinese producers’ interim 2009 inventories thus were equivalent to

about *** percent of domestic producers’ interim 2009 production of *** short tons.114 U.S. importers’

inventories were also substantial at the end of the period examined,115 and the sale and shipment of those

inventories into the U.S. market will likely occur in the imminent future with a consequent negative

impact on demand for new OCTG production.116

 Moreover, production facilities in China that are currently used to produce other pipe products

have the potential to be shifted to production of OCTG. Many Chinese producers report that ***.117 In

fact, Chinese welded pipe producers have an incentive to shift production to OCTG to avoid

countervailing and antidumping duties in the United States on welded standard pipe and line pipe.118

The record indicates not only that producers of subject OCTG have the ability to increase

shipments to the United States, but that they have a strong interest in increasing such shipments as well. It

appears that Chinese producers have been motivated to increase subject imports for quite some time. 

 111 (...continued)

industry as a whole and by drawing reasonable inferences from the evidence it finds most persuasive.” Statement of

Administrative Action (“SAA”) on Uruguay Round Agreements Act (“URAA”), H.R. Rep. 103-316, Vol. I at 869

(1994).

 112 CR/PR at Table VII-4.

 113 CR/PR at Tables VII-4, C-1. Chinese producers forecast that they will increase their OCTG production in

2010 over the level they forecast for 2009. CR/PR at Table VII-4.

 114 CR/PR at Table VII-4, C-1.

 115 CR/PR Table VII-6. The importers’ inventory totals discussed in the context of likely demand, supra, included

inventories of both subject and nonsubject imports. Relevant to the likely volume of subject imports, however, are

importers’ inventories of subject imports. Importers’ inventories of subject merchandise increased from *** short

tons in 2006 to *** short tons in 2007 and *** short tons in 2008. Importers’ inventories of subject imports were

*** short tons in interim 2008 and *** short tons in interim 2009. Id. 

 116 We noted in our preliminary determination that we intended to consider inventories of purchasers further in

any final phase investigation. In this regard, the statute (19 U.S.C. § 1677(7)(F)(i)) “mak{es} it clear that the

Commission will consider inventories of the subject merchandise wherever they are located.” SAA at 854. As

noted above, we have considered purchaser inventories, which will be a factor dampening any increase in demand in

the imminent future. 

 117 See CR/PR at Table VII-3 nn. 2, 4, 5, 6, 9, 10, 11, 14, 16 (***).

 118 73 Fed. Reg. 42545 (Jul. 22, 2008) (countervailing duty order on standard pipe from China), 73 Fed. Reg.

42547 (Jul. 22, 2008) (antidumping duty order on standard pipe from China), 74 Fed. Reg. 4136 (Jan. 23, 2009)

(countervailing duty order on line pipe from China); 74 Fed. Reg. 22515 (May 13, 2009) (antidumping duty order on

line pipe from China). 

20
China has not only been the world’s leading OCTG exporter in recent years, but its exports have

increased sharply, from 1.3 million short tons in 2006 to 4.3 million short tons in 2008.119 As a result, the

Chinese industry is export oriented, with Chinese producers’ exports rising to 38.0 percent of their total

shipments in 2008.120 The Chinese OCTG industry’s growing reliance upon export markets is highlighted

by the increase in China’s OCTG trade surplus of approximately 3.2 million tons during the period

examined, from 0.9 million short tons in 2006 to 4.1 million short tons in 2008.121

Recent events have only intensified subject producers’ incentive to increase shipments to the

United States. OCTG producers in China have brought new production capacity on line at the very time

that the global economic downturn has reduced global demand for oil and natural gas.122 The difficulties

for OCTG producers in China have deepened as a result of trade restricting remedies on imports from

China by both Canada and the EU. In March 2008, the Canadian Government found that seamless oil and

gas well casing from China not exceeding 11.75 inches threatened to cause injury to the Canadian OCTG

industry. In October 2009, it also reached an affirmative preliminary injury determination regarding all

welded or seamless OCTG, other than seamless casing covered by the March 2008 determination, with

outside diameters from 2-3/8 inches and 13-3/8 inches.123 The EU imposed antidumping duties in

October of 2009 on a range of seamless pipe products, including seamless OCTG.124 These trade

restrictions will likely inhibit shipments of OCTG from China to these markets in the imminent future.125

Given that China’s OCTG production capacity is growing and demand in non-U.S. markets will not

return to peak or near peak levels in the imminent future, Chinese producers of OCTG face even greater

pressure to increase export shipments to the United States than they did in the past.

The United States represents a highly attractive market. In fact, producers in China apparently

identified the United States as a very attractive market even prior to the current conditions that intensified

the pressure to increase export shipments. As noted, subject imports to the United States from China

tripled from 2006 to 2008, and the share of OCTG production exported from China that was directed to

 119 CR/PR at Table VII-11. At the same time, home market shipments by responding Chinese producers declined

from 75.6 percent of their total shipments in 2006 to 59.6 percent in 2008, notwithstanding that their home market

shipments increased to 71.3 percent of total shipments with the decline in global demand in interim 2009. Id. 

 120 CR/PR at Table VII-4. Chinese producers forecast that they will increase their total exports in 2010 over the

levels expected for 2009. CR/PR at Table VII-4.

 121 CR/PR at Table VII-11.

 122 E.g., CR/PR at Table VII-2; CR at VII-2, PR at VII-1; CR at II-11-15, PR at II-7. 

 123 CR at VII-15-16, PR at VII-7. 

 124 CR at VII-16, PR at VII-7-8. 

 125 Respondents downplay the significance of import restraints in these markets, among others. See Respondents’

Posthearing Brief at Exhibit 6. Although each of these two markets was individually substantially smaller than the

U.S. market in 2008, both Canada and the EU were among China’s top 10 export markets in that year. See U.S.

Steel’s Prehearing Brief at Exhibit 68 (also referenced in Respondents’ Posthearing Brief at Exhibit 6). The EU is a

market in which recent OCTG prices have exceeded those in the United States (Metal Bulletin Research (Nov. 2009)

at 2), making the retention of other relatively high-priced markets all the more important for the Chinese industry. 

Moreover, Chinese producers face the ongoing challenge of selling OCTG into export markets with active

import injury investigations concerning OCTG. These include Canada (welded OCTG and seamless tubing,

preliminary determination in October 2009), and Argentina (seamless and welded OCTG, initiated in November

2009) (CR at VII-15 through VII-16 and nn. 32 through 37, PR at VII-7 through VII-8 and nn. 32 through 37), as

well as Mexico (seamless OCTG, initiated in September 2009) (U.S. Steel’s Prehearing Brief at Exhibit 87 (“Mexico

launches anti-dumping investigation into Chinese seamless . . .”)). 

21
the U.S. market increased from 45 percent in 2006 to 60 percent in 2008.126 127 This focus is not

unexpected, considering that the United States is the world’s largest single country market for OCTG.128

Additionally, although prices for seamless OCTG in the United States are somewhat lower than in

Western Europe and Japan, they are noticeably higher than prices in Eastern Europe and the Middle

East.129 Moreover, the U.S. market is well understood by OCTG producers in China, who increased

shipments to the United States from 2006 to 2008 and, in so doing, established relationships with a

broader range of importers. The record does not include any indication that Chinese producers, in the

absence of a countervailing or antidumping duty order, would find the U.S. market any less attractive in

the imminent future than they did during the period examined.130 Although demand in the United States

is expected to be lower in the imminent future than in prior years, Chinese producers will target the new

orders for OCTG that arise, consistent with their market share gains in the United States throughout the

period examined. 

Based on the above, we conclude that producers of OCTG in China have both the ability and the

incentive to increase exports of subject OCTG. We also conclude that the United States is a highly

attractive market for Chinese OCTG producers, given that it is the largest OCTG market in the world, it

has attractive prices, and Chinese producers are familiar with the market and have dramatically increased

shipments to it in recent years. Additionally, we note that the market share of subject imports in the

United States has increased consistently, regardless of U.S. market conditions, throughout the period

under examination. Thus, we conclude that subject import volume is likely to be significant within an

imminent time frame, both in absolute terms and relative to consumption and production in the United

States, and that the increase in subject imports’ market share will likely be significant.

 126 Although the United States accounted for only 27 percent of exports of subject OCTG from China during

interim 2009, the fact that subject merchandise continued to gain market share in the United States and accumulated 

in inventory indicates that the United States remained a very attractive market for producers of subject OCTG during

that period. CR/PR at Table C-1.

 127 Official Commerce statistics indicate that subject imports have been at extremely low levels since July 2009,

and responding importers report that they have not imported or arranged for the importation of OCTG from China

since October 2009. CR/PR at Tables IV-4, VII-7. We note, however, that ***. CR at VII-10 n.29, PR at VII-4

n 29. ***. Id. As noted above, moreover, we find that the decline in subject imports is at least in part attributable

to the pendency of this investigation. See 19 U.S.C. § 1677(7)(I)). 

 128 CR at VII-21, PR at VII-12; CR/PR at Table VII-11.

 129 See Posthearing Brief of TMK IPSCO et al. at Exhibit 6; Metal Bulletin Research (Nov. 2009) at 2. 

 130 To the contrary, the Vice President for Strategic Planning and Business Development of Wuxi Seamless Oil

Pipe Co., Ltd., a major Chinese producer of OCTG and a respondent in this investigation, acknowledged in a press

report that Wuxi is closely watching the U.S. trade remedy proceedings on Chinese OCTG, that it reduced exports to

the United States in 2009 in response to this proceeding, and that, if no duties are imposed as a result, “we would be

back immediately.” “WSP rejigs Texas OCTG plant schedule,” American Metal Market (Sept. 11, 2009) (exhibit 2

to Prehearing Brief of TMK IPSC et al.). Putting those statements in context, between 2006 and 2008, Wuxi's

OCTG capacity *** while its OCTG exports to the United States ***. Wuxi projects that its OCTG capacity ***

but projects that its OCTG exports to the United States ***, based on “temporary estimation.” Wuxi foreign

producer questionnaire response at 7.

22
D. Likely Price Effects of the Subject Imports

1. Analysis of Material Injury by Reason of Subject Imports

As explained above in the discussion of conditions of competition, the domestic like product and

subject imports are generally interchangeable, and price is an important consideration in purchasing

decisions.131 Moreover, most sales of both the domestic like product and subject imports are made to

distributors.132

The Commission collected quarterly pricing data for six OCTG products.133 Usable pricing data

were provided by four domestic producers, accounting for *** percent of domestic producers’ shipments

during the period examined, and twenty-five importers, accounting for *** percent of shipments of

subject imports during the period.134 Subject imports undersold the domestic like product in 58 of

73 quarterly pricing comparisons by margins ranging from 0.5 percent to 46.4 percent.135

Prices for U.S.-produced OCTG generally fluctuated within a narrow range during 2006 and 2007

with no apparent trend. Prices for the domestic product then increased in the last three quarters of 2008,

by over $1,000 per short ton, before declining in 2009 to levels still generally higher than those in 2006

and 2007. Prices for the subject imports from China also fluctuated within a narrow range in 2006 and

2007, generally increased in 2008, and then fell in 2009.

We find that subject imports significantly undersold the domestic like product during the period

examined and gained market share as a result. Nevertheless, we do not find that subject imports

significantly depressed or suppressed the prices of domestically produced OCTG. As noted, domestic

producers’ prices increased to very high levels in 2008, indicating that the underselling by subject imports

did not depress prices for the domestic like product. Those increased prices more than covered any

increase in domestic producers’ unit cost of goods sold (COGS) in 2008, as reflected in the decline in

COGS as a share of net sales in 2008.136 We therefore find that subject imports did not suppress domestic

prices through 2008. 

Moreover, while domestic producers’ prices declined notably in interim 2009 from their 2008

peaks, they generally remained above their 2006 and 2007 levels. Although the data indicate the

beginning of a cost/price squeeze in interim 2009,137 the data for the entire period under examination do

not indicate price suppression.138 We conclude that subject imports are not having a significant adverse

effect on domestic producers’ prices. 

 131 CR/PR at Tables II-5, II-7. 

 132 CR/PR at Table II-1. 

 133 CR at V-5, PR at V-4.

 134 CR at V-5-6, PR at V-4. The 25 importers providing usable pricing data include 17 that provided data in the

final phase of the investigation and 8 that responded only in the preliminary phase. CR at V-6, PR at V-4. 

 135 CR/PR at Tables V-2 - V-7, V-9.

 136 Unit COGS increased from $1,008 in 2006 to $1,055 in 2007 and $1,285 in 2008. Average unit sales value

decreased from $1,489 in 2006 to $1,399 in 2007, then increased to $2,070 in 2008. Unit COGS as a percentage of

sales increased from 67.7 percent in 2006 to 75.4 percent in 2007 before declining to 62.1 percent in 2008. CR/PR

at Table C-1.

 137 Unit COGS was $1,204 in interim 2008 and $1,655 in interim 2009; average unit sales value was $1,835 in

interim 2008 and $2,062 in interim 2009; unit COGS as a share of net sales was 65.6 percent in interim 2008 and

80.3 percent in interim 2009. CR/PR at Table C-1.

 138 Moreover, the trend in interim 2009 coincided with, and appears to have been caused by, a slump in demand

that was a consequence of conditions in the overall economy. 

23
2. Analysis of Threat of Material Injury by Reason of Subject Imports

We next consider the likely price effects of subject imports in the imminent future. As it attempts

to increase exports to the United States, the Chinese industry is likely to continue to use underselling and

aggressive pricing as a means to increase market share, given that subject OCTG from China and the

United States are generally substitutable. Given that subject imports undersold domestic OCTG to a

significant degree throughout the period, and particularly toward the end of the period when demand was

relatively depressed, we find that underselling is likely to be significant in the imminent future. We find

that underselling by subject imports is likely to increase the attractiveness of those imports to domestic

purchasers compared with domestic production.

In respect to adverse effects on U.S. prices, we consider whether price depression and/or price

suppression is likely as a result of subject imports. In performing that analysis, we note first that

underlying demand for OCTG in the U.S. market has fallen in interim 2009 to levels lower than at any

time during 2006 through 2008, whether measured by oil and natural gas prices, rig count, operator

consumption, or other indicators.139 Not only is underlying demand depressed, but demand for new

shipments is further depressed by high inventories held by both distributors and end users.140 In this

environment, the introduction of increased quantities of subject imports, aggressively priced in an effort

to gain market share, will put pressure on domestic producers to lower prices in an already very

unfavorable market, in order to compete for sales and prevent an accelerated erosion of their market

share.

Accordingly, subject imports are likely to enter at prices that will have a significant depressing

effect on domestic prices for OCTG. In addition, as noted above, the domestic industry’s ratio of COGS

to net sales was markedly higher in interim 2009 than in interim 2008. As subject imports cause the

domestic industry to lose further sales volume, the U.S. industry is likely to further curtail production,

resulting in higher per unit production costs and rising COGS/net sales ratios. Although demand is

expected to increase to a small degree in the imminent future, domestic producers will likely be unable to

raise prices to offset higher costs, due to competition from the increased volume of aggressively priced

subject imports. As subject imports cause the domestic industry to experience high per-unit production

costs and prevent the domestic industry from raising prices in order to offset the higher costs, the

domestic industry will likely experience a cost/price squeeze. For these reasons, we conclude that subject

imports are likely to enter at prices that will have significant price suppressing as well as price depressing

effects.141 

We conclude that, in the imminent future, the aggressive price competition demonstrated by

subject imports during the bulk of the period examined will continue. As subject imports cause domestic

sales volumes and prices to deteriorate and per-unit costs to increase, the domestic industry will

experience significant price depression and suppression. 

 139 CR/PR at Figure II-6 (oil and natural gas prices), Figure II-4 (rig count), Figure II-3 (footage drilled), Figure

II-2 (operator consumption), Table C-1 (apparent U.S. consumption). 

 140 CR/PR Tables II-2, Figure II-1; see also CR at II-9, PR at II-5; CR/PR at IV-1 n.2, CR/PR at Table VII-6. 

 141 Commission staff was able to confirm two of the petitioners’ lost sales allegations for interim 2009. CR/PR at

Table V-10. 

24
E. Likely Impact of the Subject Imports on the Domestic Industry142

1. Analysis of Material Injury by Reason of Subject Imports

Between 2006 and 2008, the domestic OCTG industry registered gains in many performance

indicators, including production, shipments, and employment.143 The industry earned solid profits each

year from 2006 to 2008 as highly favorable demand conditions increased the industry’s prices faster than

the increase in its costs despite competition from the increasing volume of low-priced subject imports. 

Notably, the industry’s financial performance was strongest in 2008, when subject imports reached their

peak.144

As described above, U.S. market demand for OCTG plunged starting in the latter part of 2008

and remained anemic through interim 2009. The market share of subject imports increased as demand

dropped and was higher in interim 2009 than in interim 2008, pushing domestic producers’ market share

down 16.0 percentage points.145

Although the industry’s performance indicators were down sharply in interim 2009 compared

with interim 2008,146 this appears to have been demand driven in large part and, in any event, the

industry’s performance over the entire period examined does not warrant a finding of present material

injury by reason of subject imports. In particular, despite the rising volumes of subject imports, favorable

demand conditions permitted the industry to increase prices and profits very substantially in 2008. 

Although the rising volume of aggressively priced subject imports may have prevented the domestic

industry from making even greater gains, the record does not establish a significant adverse impact during

the period 2006 through 2008. During interim 2009, aggressively priced subject imports made very

substantial gains in terms of market share, but given that the absolute level of such imports was down and

that the interim 2009 data are not reflective of the trends during the entire period examined, we do not

conclude that subject imports had a significant adverse impact on the domestic industry. The data show

that the industry enjoyed very favorable financial returns during the three previous years and that prices,

though falling at the end of the period, were declining from the peak levels observed during 2008. 

2. Analysis of Threat of Material Injury by Reason of Subject Imports

Although we do not find present material injury by reason of subject imports, the state of the

industry observed in interim 2009 weighs heavily in our consideration of the impact of subject imports in

 142 Although we reviewed the separate record data for the welded and seamless OCTG portions of the domestic

industry (e.g., CR/PR at Tables C-2, C-3) (notwithstanding the absence of argument that we do so), we base our

analysis on data for the industry as a whole (e.g., CR/PR at Table C-1).

 143 Production was 2.94 million short tons in 2006, 2.51 million short tons in 2007, and 3.08 million short tons in

2008. Domestic shipments were 2.81 million short tons in 2006, 2.38 million short tons in 2007, and 2.99 million

short tons in 2008. Production and related workers totaled 5,448 in 2006, 5,396 in 2007, and 5,819 in 2008. Hours

worked totaled 11.95 million in 2006, 11.48 million in 2007, and 12.87 million in 2008. Domestic production

capacity was 4.29 million short tons in 2006, 4.24 million short tons in 2007, and 4.47 million short tons in 2008. 

Capacity utilization was 68.5 percent in 2006, 59.2 percent in 2007, and 69.0 percent in 2008. Productivity (in tons

per 1,000 hours) was 246.2 in 2006, 218.4 in 2007, and 239.4 in 2008. CR/PR at Table C-1.

 144 Operating profit was $1.22 billion in 2006, $598 million in 2007 and $2.10 billion in 2008. The domestic

industry’s ratio of operating income to net sales was 27.8 percent in 2006, 17.4 percent in 2007, and 32.6 percent in

2008. CR/PR at Table VI-1.

 145 Subject import volume was 1.23 million short tons in interim 2008 and 739,659 short tons in interim 2009. 

CR/PR at Table IV-2.

 146 See, e.g., CR/PR at Table C-1 and discussion infra. 

25
the imminent future. As discussed above, despite a positive trend in the industry’s performance during

most of the period examined, its performance has recently declined substantially in terms of production,

shipments, net sales, unit COGS, operating income, and operating margins.147 The domestic industry has

idled much of its capacity, including entire production facilities, and has thus experienced a steep drop in

capacity utilization and widespread layoffs.148 Accordingly, we find that the industry is currently in a

weakened state and is vulnerable to material injury. We also find that the industry’s vulnerability is

heightened by relatively flat demand conditions in the imminent future, aggravated by large purchaser

inventories that sharply curtail future demand.

The current state of the domestic industry is primarily attributable to the sudden drop in demand

that began in 2008. Looking forward, the conditions that drove demand and domestic prices upward in

2008 are not likely to recur in the imminent future. Rather, demand is likely to remain anemic (albeit

increasing) in the imminent future.149 Moreover, high inventory levels will continue to limit demand for

new production.150

We evaluate the likely effects of the significant volume of aggressively priced subject imports

from China on the domestic industry in the imminent future in light of these market conditions. As

subject imports continue to take market share from the domestic industry and to exert significant price

depressing and suppressing effects, the domestic industry will likely experience further declines in

production, market share, capacity utilization, and shipments. As a result of these adverse trends, the

domestic industry will also likely experience lower employment levels, net sales, operating income, and

profitability. Given that the industry is already in a weakened state, we conclude that these effects are

significant and support a conclusion that the domestic industry is threatened with material injury by

reason of subject imports from China. Accordingly, we find that there is a likely causal relationship

between the subject imports and an imminent adverse impact on the domestic industry. 

 We have considered whether other factors will likely have an imminent adverse impact on the

domestic industry. As noted, we recognize the impact of the decline in demand for OCTG on the

domestic industry’s performance near the end of the period examined. Although demand is likely to

remain at depressed levels in the imminent future, it is not likely to decline further from present levels,

but instead will increase slightly. Accordingly, the likely further declines in the domestic industry’s

production, market share, capacity utilization, shipments, employment levels, productivity, and operating

income will come as a result of subject imports gaining market share and having adverse price effects on

domestic OCTG, rather than as a result of new declines in demand. Accordingly, in our analysis of the

threat of material injury we do not attribute injury caused by changes in demand to subject imports. 

 147 The industry’s trade and performance indicators declined substantially in the first nine months of 2009 when

compared to the first nine months of 2008. Production was 2.27 million short tons in interim 2008 and 606,651 short

tons in interim 2009. U.S. shipments were 2.23 million short tons in interim 2008 and 677,514 short tons in interim

2009. Net sales quantity was 2.32 million short tons in interim 2008 and 0.71 million short tons in interim 2009, and

net sales value was $4.25 million in interim 2008 and $1.46 million in interim 2009. Unit COGS was $1.20 per

short ton in interim 2008 and $1.66 per short ton in interim 2009. Operating income was $1.21 billion in interim

2008 and $61.90 million in interim 2009, and operating income as a percentage of sales was 28.4 percent in interim

2008 and 4.2 percent in interim 2009. CR/PR at Table C-1. 

 148 Capacity was somewhat higher in interim 2009, at 3.44 million short tons, than in interim 2008, at 3.35 million

short tons (CR/PR at Table C-1, see also CR/PR at Table III-2), and capacity utilization was 67.6 percent in interim

2008 and 17.6 percent in interim 2009. The number of production and related workers was 5,497 in interim 2008

and 3,398 in interim 2009. Hours worked were 9.12 million in interim 2008 and 4.53 million in interim 2009. 

Productivity (in tons per 1,000 hours worked) was higher in interim 2009 than in interim 2008, at 248.7 in interim

2008 and 134.0 in interim 2009. CR/PR at Table C-1. 

 149 CR/PR at Figure II-6.

 150 See, e.g., CR/PR at Table III-6 (order book volume at 136,657 short tons at the end of interim 2009, contrasted

with 612,095 short tons at the end of interim 2008).

26
We also recognize that nonsubject imports were a factor in the U.S. market during the period

examined. Nonsubject import prices, however, tended to be higher than subject import prices.151 The

volume of nonsubject imports, some of which were originally subject to the discipline of antidumping

duty orders during part of the period examined, fluctuated in accordance with changes in demand, in

contrast with the substantial increases in subject imports regardless of changes in demand. Specifically,

while subject imports’ market share increased consistently and substantially, the market share of

nonsubject imports declined between 2006 and 2007, as demand declined.152 Moreover, the market share

of nonsubject imports increased to a lesser degree between interim 2008 and interim 2009 than did the

market share of subject imports.153 Accordingly, nonsubject imports are not likely to take market share or

sales from the domestic industry in the imminent future.

We conclude that, unless a countervailing duty order is issued, significant volumes of subsidized

imports will gain additional U.S. market share in the imminent future and lead to material injury by

reason of subject imports. Accordingly, we determine that the domestic industry is threatened with

material injury by reason of subject imports from China. 

We further determine, pursuant to 19 U.S.C. § 1671d(b)(4)(B), that we would not have found

material injury but for the suspension of liquidation of subject imports. 

CONCLUSION

For the foregoing reasons, we find that the domestic industry producing OCTG is threatened with

material injury by reason of subject imports from China that are subsidized by the Government of China.

 151 CR/PR at F-3.

 152 CR/PR at Table C-1. Total nonsubject imports followed the U.S. demand trend, including by declining in

2007, notwithstanding the removal of antidumping duty orders on Argentina, Italy, Japan, Korea, and Mexico in

2007 and increased volumes of imports from those countries that year. CR/PR at Tables IV-3, C-1; 72 Fed. Reg.

34442 (Jun. 22, 2007).

 153 See CR/PR at Table C-1.

27
 
SEPARATE VIEWS OF COMMISSIONERS CHARLOTTE R. LANE

AND IRVING A. WILLIAMSON

On the basis of the record in the final phase of this investigation, we determine that an industry in

the United States producing certain oil country tubular goods (“OCTG”) is materially injured by reason of

imports of OCTG from China that the Department of Commerce (“Commerce”) has found to be

subsidized by the Government of China. We join our colleagues’ findings with respect to the domestic

like product, domestic industry, legal standards, and conditions of competition that are distinctive to the

OCTG industry. We write separately to explain our conclusion that the domestic industry has already

suffered material injury at the hands of subject imports.

From 2006 through 2008, the domestic OCTG industry performed strongly, enjoying solid

demand, prices, and profits. During 2008, Chinese OCTG manufacturers and exporters flooded the U.S.

market with OCTG that was substitutable for U.S. product but sold at lower prices. Surging oil and

natural gas prices in 2008 prompted an OCTG buying frenzy in the United States that the Chinese

companies were willing and able to exploit. Because the volume of imports from China in 2008 far

outstripped actual demand for OCTG by energy companies, substantial volumes of the 2008 imports were

retained in importers’ inventories or held as purchaser stockpiles. In late 2008 and early 2009, as the

financial crisis hit the U.S. economy, energy prices as well as demand for OCTG dropped. Subject

imports continued to pour in at high volumes through first-quarter 2009, however, adding to the swollen

inventories.

The combination of high inventory quantities and stunted end-user consumption of OCTG meant

that the demand for new OCTG nearly disappeared in early 2009. The domestic industry’s order books

dried up in the first six months of 2009 and it was forced to nearly shut down. Although conditions

improved somewhat as 2009 progressed, for the entire interim period (January through September) of

2009 the industry operated at a mere 17.6 percent capacity utilization. Compared to the same nine-month

period in 2008, the industry’s 2009 performance was dismal, with production and shipments

approximately 70 percent lower and operating profits down by almost 95 percent, forcing producers to

layoff 38 percent of their production-related workforce and cut employees’ hours by half.

The connection between subject imports and the U.S. industry’s poor 2009 experience is apparent

even after accounting for the impact of the economic crisis that began in late 2008. While drilling

companies’ consumption of OCTG was down 38 percent in interim 2009 compared to interim 2008,

domestic production and shipments fell by approximately 70 percent.1

 The effect of subject imports can

be seen in the substantially greater fall in domestic production and shipments compared to the decline in

domestic consumption. To satisfy their needs in 2009, end users turned to inventories composed in large

part of subject product imported in 2008 and to additional quantities imported in the first half of 2009,

rather than to OCTG produced by the domestic industry.

For these reasons, as explained further below, we make an affirmative determination on the basis

of present material injury.

 1 OCTG operator consumption, by month, January 2006 to October 2009, is shown at CR/PR at Figure II-2. See

also Preston Publishing Co. (worksheet, EDIS Doc. No. 415733) (hereinafter “Preston Publishing Co.”).

29
Volume of Subject Imports:

The volume of subject imports increased by 18.7 percent from 2006 to 2007, despite a nine

percent decrease in end-user demand.2

 Subject import volume then exploded in 2008, increasing by

155.3 percent compared to 2007. Subject imports’ share of the U.S. market grew steadily as well, from

15.3 percent in 2006 to 21.0 percent in 2007 and to 32.7 percent in 2008.3

Subject import levels continued to be very high in the first quarter of 2009, entering in volumes

that were more than double the volume of the first quarter of any previous year of the period examined.4

From June 2009 onward, subject imports were nearly absent from the market.5

 Even with the departure of

subject imports beginning in June, the market share of subject imports was substantially higher in interim

(January to September) 2009, at 37.0 percent, as compared to the same period in 2008, when it was

27.6 percent.

As a result of the growth in subject import volume, the U.S. market share held by domestic

OCTG producers steadily declined over the period examined. The domestic industry’s U.S. market share

fell from 59.2 percent in 2006, to 58.0 percent in 2007, and to 44.4 percent in 2008. The domestic

industry’s market share was substantially lower in interim 2009, at 33.9 percent, than it was in interim

2008, at 49.9 percent.6

The combined volume of imports from nonsubject countries declined from 2006 to 2007, then

increased from 2007 to 2008, for an overall increase of 27.4 percent from 2006 to 2008. The market

share of nonsubject imports declined from 25.4 percent in 2006 to 22.8 percent in 2008.7

By any measurement, the increase in the volume and market share of subject imports is

significant. The subject imports captured a substantial portion of the domestic OCTG market from

domestic producers during the period of investigation.

A substantial share of the subject imports that entered the United States in 2008 was not

consumed by drilling companies in that year, but instead remained in the inventories of distributors

(generally service centers) and importers. Distributor and user inventories began to rise in March 2008

and grew steadily each month thereafter for an overall increase of 1.4 million tons (62 percent) during

calendar year 2008.8

 As subject imports continued at high levels through the first quarter of 2009 and

operator consumption fell due to the economic crisis, the ratio of inventories to consumption exploded,

and peaked at over 16 months of supply in May 2009.9

 Questionnaire data from purchasers indicate that

imports from China accounted for a majority of the increase in distributor and user inventories from 2007

 2 CR/PR at Table C-1; and Preston Publishing Co.

 3

 CR/PR at Table C-1.

 4

 CR/PR at Table IV-4.

 5

 We attribute the departure of subject imports to pendency of the present investigations. See, e.g., Hearing

Transcript (“tr.”) at 195 (Mr. Shoaf, Mr. Dubois). As a result we give reduced weight to the decline in the absolute

volume of subject imports that took place during 2009.

 6

 CR/PR at Table C-1.

 7

 Nonsubject imports were 42.1 percent lower in interim 2009 compared to interim 2008, but were higher in

market share at 29.2 percent compared to 22.5 percent in the earlier interim period. Id.

 8

 Preston Publishing Co.

 9

 CR/PR at Table II-2. Typical inventory levels appear to be in the range of 5 to 6 months of supply. See, e.g., tr.

at 99 (Mr. Herald), 122 (Mr. Hausman).

30
to 2008.10 U.S. importer inventories of subject product also surged in 2008 and remained high in

September 2009.11

Inventories grew so much in 2009 because underlying demand by operators in 2008 did not grow

nearly as fast as the Chinese product entering the market. The quantity of OCTG consumed by drilling

operations increased by 29 percent in 2008, a substantial amount, but nowhere near the 155 percent

increase in subject imports in that year.12 U.S. importer inventories of subject imports increased

329.3 percent from 2006 to 2008, and were 152 percent higher in interim 2009 compared to interim

2008.13

One reason for the high volumes of OCTG purchased by U.S. distributors and importers in 2008

was the unprecedented run-up in oil and natural gas prices. In mid-2008, oil prices peaked at over

$130 per barrel and natural gas prices peaked at over $10 per 1,000 cubic feet.14 As oil and gas prices

rose, so did the price of OCTG. Rising prices resulted in ever-increasing purchases; speculative buyers

entered the market hoping to cash in on the favorable conditions.15 In this overheated market atmosphere,

U.S. buyers found in the Chinese OCTG producers willing and able suppliers of the quantities they

demanded. Unfortunately the quantities supplied by the Chinese OCTG manufacturers did not bear a

relationship to the OCTG that U.S. end-users were actually consuming. As a result, inventories in the

United States rose steadily both absolutely and in terms of months of supply on hand.

Price Effects of Subject Imports:

As addressed in the section on Conditions of Competition, the record indicates that subject

imports from China and domestic OCTG are highly interchangeable,16 most sales of both the domestic

like product and subject imports are made to distributors,17 and price is a very important factor in

purchasing decisions.18

The Commission collected quarterly pricing data from domestic producers and importers of

subject imports for six OCTG products.19 Subject imports undersold the domestic like product in 58 of

73 quarterly pricing comparisons by margins ranging from 0.5 percent to 46.4 percent.20 In terms of

quantity, 94.4 percent of subject imports covered in the pricing comparisons undersold domestic prices.21

Underselling was most pronounced in the third and fourth quarters of 2008, and the first quarter of 2009;

these were the quarters when subject import volumes were the highest, thus demonstrating that low prices

 10 CR at II-9/PR at II-5 (increase in end-of-period inventories of Chinese OCTG constituted 51.5 percent of the

total increase from 2007 to 2008).

 11 Reported importer inventories of subject OCTG more than doubled from December 31, 2007 to December 31,

2008, growing from *** tons to *** tons. Importer inventories were *** tons in September 30, 2009, compared to

*** tons on September 30, 2008. CR/PR at Table VII-6.

 12 Preston Publishing Co.

 13 CR/PR at Table C-1.

 14 CR/PR at Table II-4 and Table II-5.

 15 See, e.g., tr. at 318-320 (Mr. Dunn).

 16 CR/PR at Table II-7.

 17 CR/PR at Table II-1.

 18 CR/PR at Table II-3 and Table II-5.

 19 CR at V-5 - V-6/PR at V-4.

 20 CR/PR at Table V-9.

 21 CR/PR at Table V-9.

31
enabled subject imports to increase their share of the U.S. OCTG market.22 Persistent and significant

underselling also negates respondents’ claim that subject imports were simply being pulled into the

market due to inadequate supply from domestic producers.23 Accordingly, we find subject import

underselling of the domestic like product to be significant.

We have considered trends in OCTG prices over the period of investigation. Prices for all six

products considered were relatively flat or decreased slightly during 2006 and 2007, then rose sharply

during 2008 to peak in the fourth quarter of 2008 at levels more than double the levels of 2007. Prices

then decreased in each of the three quarters of 2009, ending the period for most products above price

levels of 2007.24 Similarly, average unit values (“AUVs”) of domestic OCTG decreased by 6.6 percent

from 2006 to 2007, increased by 49.2 percent from 2007 to 2008, and were 11.4 percent higher in interim

2009 than in interim 2008.25 Given the large price rise during the period and the fact that prices generally

ended the period higher than when they started despite the fall-off in underlying demand, we do not find

that the subject imports significantly depressed prices for the domestic like product.

We have also considered the degree to which lower-priced subject imports prevented domestic

industry price increases which otherwise would have occurred. From 2006 to 2007, the domestic

industry’s cost of goods sold (“COGS”) as a share of net sales increased by 7.7 percentage points from

67.7 percent to 75.4 percent.26 However, U.S. producers’ COGS-to-sales ratio decreased by

13.3 percentage points to 62.1 percent from 2007 to 2008.27 The domestic industry’s COGS-to-sales ratio

in interim 2009 was 14.7 percentage points higher than that for interim 2008, but this was primarily due

to fixed costs being allocated over significantly fewer sales.28 Accordingly, we find that subject imports

did not suppress domestic prices to a significant degree during the period of investigation.

In sum, we find that pervasive subject import underselling of the domestic like product

throughout the period of the investigation contributed significantly to the substantial market share that

subject imports gained during the period at the expense of the domestic industry. Subject imports gained

14.8 percentage points in market share between 2006 and 2008 and a further 9.4 percentage points in

market share in interim 2009 relative to interim 2008.29 

 22 CR/PR at Tables V-2 through V-7.

 23 Chinese Respondents’ Posthearing Brief at 3.

 24 CR/PR at Tables V-2 through V-7.

 25 CR/PR at Table C-1. Interim 2009 AUV’s were higher in interim 2008 because of the high first quarter of

2009 prices. See CR/PR at Tables V-2 through V-7.

 26 CR/PR at Table C-1.

 27 Id.

 28 See CR/PR at Table VI-1. Per unit sales values were $230 higher in interim 2009 than in interim 2008. Per

unit raw materials costs were $62 less in interim 2009 than in interim 2008. However, combined per unit direct

labor and “other factory costs” were $518 more in interim 2009 than in interim 2008. This significant increase in

production costs is related to the very low output rate for the domestic industry in interim 2009. Although output

would be expected to drop due to the reduction in demand experienced in 2009, we have determined that the impact

of subject imports, which gained market share in interim 2009, contributed significantly to this low capacity

utilization.

 29 Subject imports also took 2.6 percentage points of market share from non-subject imports from 2006 to 2008,

netting a total 17.4 percentage gain over that period. Non-subject imports took 6.6 percentage points of market share

from the domestic industry in interim 2009 relative to interim 2008. CR/PR at Table C-1.

32
Impact of Subject Imports:

We have examined the performance indicators in the trade and financial data for the domestic

OCTG industry. Between 2006 and 2008, the domestic OCTG industry registered gains in most

indicators, except for market share, for which it lost 14.8 percentage points.30 However, for many of the

indicators that did improve, the extent of the gains were below the 18 percent increase in end-user

demand from 2006 to 2008;31 this lag was because the volume of subject imports tripled over this period

and captured 17.4 percentage points of market share, 14.8 points of which came at the expense of the

domestic industry. 

Demand for OCTG in the U.S. market began to decline in the fourth quarter of 2008, and

remained low throughout interim 2009. End-user consumption in interim 2009 was 38 percent lower than

in interim 2008.32 Domestic producer’s U.S. sales were 69.6 percent lower in interim 2009 compared to

interim 2008.33 By contrast, subject imports continued to flood the U.S. market through May 2009. 

Specifically, the monthly volumes of subject imports were higher in January, February, March, and May

of 2009 than in the same months in 2008.34 Despite a decrease in end-user demand in the first quarter of

2009, Chinese producers doubled import shipments to the U.S. in the first quarter of 2009 compared to

the first quarter of 2008.35 This surge in subject imports beginning in 2008, continuing through the first

quarter of 2009, and the inventory overhang the imports created, significantly contributed to the lack of

demand for new OCTG supply in 2009. Instead of purchasing newly-produced OCTG, many end-users

purchased subject imports from distributors’ inventory, significantly decreasing domestic order books.36

In August 2008, order books for OCTG peaked at 670,248 short tons.37 Since then, order books

decreased markedly, reaching the lowest level on 47,798 short tons in May 2009.38

As a result, virtually all domestic industry performance indicators were drastically lower in

interim 2009 compared to interim 2008. Domestic production was 73.2 percent lower in interim 2009

compared to interim 2008.39 Similarly, U.S. shipments in interim 2009 were 69.6 percent less than the

level of U.S. shipments in interim 2008.40 Domestic producers lost 16.0 percentage points of market

share in interim 2009 compared to interim 2008.41 With domestic producers operating at only

17.6 percent of production capacity in interim 2009, employment of production and related workers was

 30 CR/PR at Table C-1. Everything improved except for productivity (down 2.8 percent), and market share (down

14.8 percentage points). The industry earned solid profits each year from 2006 to 2008. Production, U.S. shipments,

net sales values and quantity, and employment indicators improved from 2006 to 2008.

 31 Preston Publishing Co.

 32 Preston Publishing Co.

 33 CR/PR at Table C-1.

 34 CR/PR at Table IV-4.

 35 Id.

 36 CR/PR at Table III-6.

 37 CR/PR at Table III-7.

 38 Id.

 39 CR/PR at Table C-1.

 40 Id.

 41 Id.

33
38.2 percent lower than in interim 2008, the equivalent of 2,099 fewer workers.42 Similarly, there were

50.3 percent fewer hours worked in interim 2009 compared to interim 2008.43 

Domestic industry profits were still strong in the first quarter of 2009 as many sales were at

higher prices negotiated when demand was stronger in 2008. However, the severe decline in domestic

industry sales led to increasingly poor financial performance during the second and third quarters of 2009. 

The domestic industry posted an operating loss in excess of 20 percent in the second and third quarters of

2009 combined.44 For the entire nine-month period of 2009, domestic industry operating profits were

94.9 percent less than in interim 2008.45

We reject respondents’ argument that the condition of the domestic industry is not due to subject

imports, but rather is the result of the market cycle entering a downturn.46 The decrease in shipments and

production of new OCTG by the U.S. industry in 2009 far exceeded the decrease in actual end-user

consumption of OCTG. End-user consumption was 38 percent less in interim 2009 than in interim 2008,

whereas domestic shipments were 69.6 percent less, and domestic production was 73.2 percent less, over

the same period.47 Despite the decrease in demand, subject imports entered the United States in

significant volumes, exceeding the U.S. shipments of the domestic industry and increasing in market

share by 9.4 percentage points in interim 2009 compared to interim 2008.48 Furthermore, a significant

share of the OCTG consumed in 2009 (over half in the second and third quarters of 2009) was being

drawn from the large distributor and importer inventories, which were disproportionately comprised of

subject imports.49 In this sense, the negative impact of the subject imports was prolonged as they

depressed domestic sales and revenues throughout interim 2009. We find that, although the decline in

U.S. consumption during the interim 2009 period had a negative impact on the domestic industry, that

impact was exacerbated by significant volumes of low-priced subject imports entering the market in 2009

as well as the inventory overhang from 2008, both of which displaced domestic sales. A weaker energy

market does not sufficiently explain the severe decrease in virtually all of the domestic OCTG industry’s

performance indicators in interim 2009.

We also reject respondents’ argument that the domestic industry should have used its profits from

2008 to keep laid-off workers employed in 2009.50 Domestic producers must use their profits for

continued capital investments, taxes, as well as honor their fiduciary responsibilities to generate returns

for their shareholders.51 Moreover, if the domestic industry were to use 2008 profits to pay the 2,099

workers they were forced to layoff in 2009, the domestic industry’s 2009 employment numbers would

improve, but only at the cost of the industry’s already dismal operating income.

Finally, we find that the presence of nonsubject imports does not undermine our finding of

significant adverse effects due to subject imports. Combined imports from nonsubject sources decreased

 42 Id.

 43 Id.

 44 See Preliminary CR/PR at Table C-1, showing domestic industry operating income of 25.0 percent for the first

quarter of 2009; and Final CR/PR at Table C-1, showing domestic industry operating income of 4.2 percent for

interim 2009, covering January through September 2009.

 45 CR/PR at Table C-1.

 46 Chinese Respondents’ Prehearing Brief at 55-78.

 47 Preston Publishing Co.

 48 CR/PR at Table C-1.

 49 CR at II-9/PR at II-5. See also Preston Publishing Co..

 50 Chinese Respondents’ Prehearing Brief at 85-88.

 51 Maverick Posthearing Brief at page 1 of Exhibit 1.

34
in market share from 2006 to 2008.52 Nonsubject imports gained 6.6 percentage points of market share in

interim 2009 compared to interim 2008, but subject imports captured 9.4 percentage points during that

same period. Nonsubject imports did not increase in absolute or relative terms to the same degree as did

subject imports, and held a smaller share of the market than did subject imports in 2008 and interim

2009.53 Prices of nonsubject imports were in most cases higher than prices of subject imports or domestic

product.54

Thus we conclude that subject imports had a material adverse impact on the condition of the

domestic industry during the period of investigation.

In sum, we find that both the absolute and relative volumes of subject imports, and their increase

during the period of investigation, were significant. Subject imports gained market share at the expense

of the domestic industry through underselling the domestic product to a significant degree throughout the

period of investigation. The increase in low-priced subject imports helped produce severe declines in the

domestic industry’s trade, employment, and financial performance in 2009.

Conclusion:

For the foregoing reasons, we find that the domestic OCTG industry is materially injured by

reason of subject imports of OCTG from China found by Commerce to be subsidized by the Government

of China.

 52 CR/PR at Table C-1.

 53 CR/PR at Table C-1.

 54 Based on quarterly price comparisons involving specific OCTG products, nonsubject imports were priced lower

than the domestic like product in 44 comparisons and higher than the domestic like product in 58 comparisons. 

Nonsubject imports were priced lower than subject imports in 29 comparisons and higher in 53 comparisons. CR/PR

at F-3.

35
 
PART I: INTRODUCTION

BACKGROUND

These investigations result from a petition filed with the U.S. Department of Commerce

(“Commerce”) and the U.S. International Trade Commission (“USITC” or “Commission”) by Maverick

Tube Corporation (“Maverick”), Houston, TX; United States Steel Corporation (“U.S. Steel”), Pittsburgh,

PA; V&M Star LP (“V&M Star”), Houston, TX; V&M Tubular Corporation of America (“V&M TCA”),

Houston, TX; TMK IPSCO, Camanche, IA; Evraz Rocky Mountain Steel, Pueblo, CO; Wheatland Tube

Corp. (“Wheatland”), Wheatland, PA; and the United Steel, Paper and Forestry, Rubber, Manufacturing,

Energy, Allied Industrial and Service Workers International Union, AFL-CIO-CLC, Pittsburgh, PA,

alleging that an industry in the United States is materially injured and threatened with material injury by

reason of subsidized and less-than-fair-value (“LTFV”) imports of certain oil country tubular goods

(“OCTG”)1

 from China. Information relating to the background of the investigations is provided below.2

Effective date Action

April 8, 2009 Petition filed with Commerce and the Commission; institution of the Commission's

investigation (74 FR 17514, April 15, 2009)

May 5, 2009 Commerce’s notice of initiation (74 FR 20671 and 74 FR 20678)

May 26, 2009 Commission’s preliminary determination (74 FR 27559, June 10, 2009)

September 15, 2009 Commerce’s preliminary CVD determination (74 FR 47210); scheduling of final phase

of Commission investigation (74 FR 50242, September 30, 2009)

November 17, 2009 Commerce’s preliminary AD determination (74 FR 59117)

December 1, 2009 Commission’s hearing1

December 7, 2009 Commerce’s final CVD determination (74 FR 64045); the Commission received formal

notification of Commerce’s determination on November 30, 2009

December 30, 2009 Commission’s CVD vote

January 13, 2010 Commission’s CVD determination transmitted to Commerce

April 1, 2010 Commerce’s expected final AD determination

May 3, 2010 Scheduled date for the Commission’s AD vote

May 7, 2010 Commission’s AD determination due to Commerce

 1 App. B presents a list of witnesses appearing at the hearing.

 1 See the section entitled “The Subject Merchandise” in Part I of this report for a complete description of the

merchandise subject to these investigations. This report will use the term “OCTG” to describe the product at issue,

even though certain lower volume or specialized forms of OCTG (drill pipe, high-chromium casing and tubing) are

excluded.

 2 Federal Register notices cited in the tabulation are presented in app. A.

I-1
STATUTORY CRITERIA AND ORGANIZATION OF THE REPORT

Statutory Criteria

Section 771(7)(B) of the Tariff Act of 1930 (the “Act”) (19 U.S.C. § 1677(7)(B)) provides that in

making its determinations of injury to an industry in the United States, the Commission--

shall consider (I) the volume of imports of the subject merchandise, (II)

the effect of imports of that merchandise on prices in the United States

for domestic like products, and (III) the impact of imports of such

merchandise on domestic producers of domestic like products, but only

in the context of production operations within the United States; and . . .

may consider such other economic factors as are relevant to the

determination regarding whether there is material injury by reason of

imports.

Section 771(7)(C) of the Act (19 U.S.C. § 1677(7)(C)) further provides that--

In evaluating the volume of imports of merchandise, the Commission

shall consider whether the volume of imports of the merchandise, or any

increase in that volume, either in absolute terms or relative to production

or consumption in the United States is significant.

. . .

In evaluating the effect of imports of such merchandise on prices, the

Commission shall consider whether . . . (I) there has been significant

price underselling by the imported merchandise as compared with the

price of domestic like products of the United States, and (II) the effect of

imports of such merchandise otherwise depresses prices to a significant

degree or prevents price increases, which otherwise would have

occurred, to a significant degree.

. . .

In examining the impact required to be considered under subparagraph

(B)(i)(III), the Commission shall evaluate (within the context of the

business cycle and conditions of competition that are distinctive to the

affected industry) all relevant economic factors which have a bearing on

the state of the industry in the United States, including, but not limited to

. . . 

(I) actual and potential declines in output, sales, market share, profits,

productivity, return on investments, and utilization of capacity, (II)

factors affecting domestic prices, (III) actual and potential negative

effects on cash flow, inventories, employment, wages, growth, ability to

raise capital, and investment, (IV) actual and potential negative effects

on the existing development and production efforts of the domestic

industry, including efforts to develop a derivative or more advanced

version of the domestic like product, and (V) in {an antidumping

investigation}, the magnitude of the margin of dumping.

I-2
Organization of the Report

Part I of this report presents information on the subject merchandise, subsidy and dumping

margins, and domestic like product. Part II of this report presents information on conditions of

competition and other relevant economic factors. Part III presents information on the condition of the

U.S. industry, including data on capacity, production, shipments, inventories, and employment. Parts IV

and V present the volume and pricing of imports of the subject merchandise, respectively. Part VI

presents information on the financial experience of U.S. producers. Part VII presents the statutory

requirements and information obtained for use in the Commission’s consideration of the question of threat

of material injury as well as information regarding nonsubject countries.

U.S. MARKET SUMMARY

OCTG generally is used in oil and gas wells, and consists primarily of casing and tubing. The

leading U.S. producers of OCTG are U.S. Steel and TMK IPSCO, both of which produce OCTG in

multiple U.S. facilities and manufacture both seamless and welded OCTG. The leading producers of

OCTG outside the United States include Baoshan Iron & Steel Co., Baotou Steel International Economic

and Trading Co., Hunan Hengang Valin Steel, Tianjin Pipe, and Wuxi Seamless Oil Pipe of China. The

leading U.S. importers of OCTG from China are ***. Leading importers of OCTG from nonsubject

countries (primarily Canada, Germany, Japan, and Korea) include ***. U.S. purchasers of OCTG include

distributors - which typically purchase directly from U.S. mills and U.S. importers - as well as production

and exploration companies that purchase from the distributors. Leading distributors include *** and

leading end users include ***.

Apparent U.S. consumption of OCTG totaled approximately 6.7 million short tons ($11.6 billion)

in 2008. Seven firms, accounting for the large majority of overall U.S. production and more than

*** percent of U.S. mill OCTG operations, responded to the Commission’s request for data. U.S.

producers’ U.S. shipments of OCTG totaled 3.0 million short tons ($6.2 billion) in 2008, and accounted

for 44.4 percent of apparent U.S. consumption by quantity and 53.4 percent by value. U.S. imports from

China totaled 2.2 million short tons ($2.8 billion) in 2008 and accounted for 32.7 percent of apparent U.S.

consumption by quantity and 24.3 percent by value. U.S. imports from nonsubject sources totaled

1.5 million short tons ($2.6 billion) in 2008 and accounted for 22.8 percent of apparent U.S. consumption

by quantity and 22.3 percent by value.

Apparent U.S. consumption was markedly lower in January-September 2009 relative to JanuarySeptember 2008. U.S. imports from China accounted for 37.0 percent of the U.S. market during the first

three quarters of the year, while U.S. producers’ U.S. shipments accounted for 33.9 percent and U.S.

imports from all countries other than China accounted for 29.2 percent.

SUMMARY DATA AND DATA SOURCES

A summary of data collected in these investigations is presented in appendix C, tables C-1

through C-3. Except as noted, U.S. industry data are based on questionnaire responses of seven firms that

accounted for nearly all U.S. mill production of OCTG during 2008. U.S. imports are based on official

Commerce statistics except as noted. Additional information regarding U.S. tariff treatment of OCTG,

supplemental responses to issues identified by the Commission, nonsubject price data, and the alleged

effects of subject imports appears in appendixes D, E, F, and G, respectively.

I-3
PREVIOUS AND RELATED INVESTIGATIONS

Antidumping and Countervailing Duty Investigations

OCTG has been the subject of several Commission investigations. A listing of these

investigations is presented in table I-1.

Table I-1

OCTG: Previous and related investigations, 1984-2009

Original Investigation Commission reviews

Current status

Date1 Number Country Outcome Dates1 Outcomes

1984 701-TA-215 Brazil Affirmative - - ITA revoked 8/21/85

1984 701-TA-216 Korea Negative - - -

1984 701-TA-217 Spain Affirmative - - ITA revoked 7/31/85

1984 731-TA-191 Argentina Negative - - -

1984 731-TA-192 Brazil Affirmative2 - - Petition withdrawn

1984 731-TA-193 Korea Affirmative2 - - Petition withdrawn

1984 731-TA-194 Mexico Affirmative2 - - Petition withdrawn

1984 731-TA-195 Spain Affirmative - - ITA revoked 6/30/85

1985 701-TA-240 Austria Affirmative2 - - Petition withdrawn

1985 701-TA-241 Venezuela Affirmative2 - - Petition withdrawn

1985 701-TA-255 Canada Affirmative - - ITA revoked 7/10/91

1985 701-TA-256 Taiwan Negative - - -

1985 731-TA-249 Austria Affirmative2 - - Petition withdrawn

1985 731-TA-251 Venezuela Affirmative2 - - Petition withdrawn

1985 731-TA-275 Argentina Affirmative2 - - Terminated

1985 731-TA-276 Canada Affirmative 1999 / - Negative / - Revoked

1985 731-TA-277 Taiwan Affirmative 1999 / - Negative / - Revoked

1986 701-TA-271 Israel Affirmative - - ITA revoked 3/1/93

1986 731-TA-318 Israel Affirmative - - ITA revoked 7/27/99

1995 701-TA-363 Austria Negative - - -

1995 701-TA-364 Italy Affirmative 2001 / - Affirmative ITA revoked 12/26/06

1995 731-TA-711 Argentina Affirmative 2001 / 2006 Affirmative/Negative Revoked

1995 731-TA-712 Austria Negative - - -

1995 731-TA-713 Italy Affirmative 2001 / 2006 Affirmative/Negative Revoked

Table continued on next page.

I-4
Table I-1 – Continued

OCTG: Previous and related investigations, 1984-2009

Original Investigation Commission reviews

Current status

Date1 Number Country Outcome Dates1 Outcomes

1995 731-TA-714 Japan Affirmative 2001 / 2006 Affirmative/Negative Revoked

1995 731-TA-715 Korea Affirmative 2001 / 2006 Affirmative/Negative Revoked

1995 731-TA-716 Mexico Affirmative 2001 / 2006 Affirmative/Negative Revoked

1995 731-TA-717 Spain Negative - - -

2002 701-TA-428 Austria Negative2 -- -

2002 731-TA-992 Austria Negative2 -- -

2002 731-TA-993 Brazil Negative2 -- -

2002 731-TA-994 China Negative2 -- -

2002 731-TA-995 Colombia (3

)- - -

2002 731-TA-996 France Negative2 -- -

2002 731-TA-997 Germany Negative2 -- -

2002 731-TA-998 India Negative2 -- -

2002 731-TA-999 Indonesia Negative2 -- -

2002 731-TA-1000 Romania Negative2 -- -

2002 731-TA-1001 South Africa Negative2 -- -

2002 731-TA-1002 Spain Negative2 -- -

2002 731-TA-1003 Turkey Negative2 -- -

2002 731-TA-1004 Ukraine Negative2 -- -

2002 731-TA-1005 Venezuela Negative2 -- -

 1 “Date” or “Dates” refers to the year in which the investigation, first review, or second review was instituted by the Commission.

 2

 Preliminary determination.

 3

 Following the withdrawal of the petition on Colombia and Commerce’s decision not to institute an investigation on OCTG from

that country, the Commission discontinued its investigation No. 731-TA-995 (OCTG from Colombia).

Source: Compiled from Commission determinations published in the Federal Register.

I-5
Safeguard Investigations

Following receipt of a request from the Office of the United States Trade Representative

(“USTR”) on June 22, 2001, the Commission instituted investigation No. TA-201-73, Steel, under section

202 of the Trade Act of 19743

 to determine whether certain steel products, including seamless and welded

OCTG,4

 were being imported into the United States in such increased quantities as to be a substantial

cause of serious injury, or the threat thereof, to the domestic industries producing articles like or directly

competitive with the imported article.5

 On July 26, 2001, the Commission received a resolution adopted

by the Committee on Finance of the U.S. Senate (“Senate Finance Committee” or “Committee”)

requesting that the Commission investigate certain steel imports under section 201 of the Trade Act of

1974.6

 Consistent with the Senate Finance Committee’s resolution, the Commission consolidated the

investigation requested by the Committee with the Commission’s previously instituted investigation No.

TA-201-73.7

 On December 20, 2001, the Commission issued its determinations and remedy

recommendations. The Commission made a negative determination with respect to OCTG.8

NATURE AND EXTENT OF SUBSIDIES AND SALES AT LTFV

Subsidies

On December 7, 2009, Commerce published a notice in the Federal Register of its final

determination of countervailable subsidies for producers and exporters of OCTG from China.9

 Table I-2

presents Commerce’s findings of subsidization of OCTG in China. Programs determined

to be countervailable10 are as follows:

 3 19 U.S.C. § 2252.

 4

 Seamless and welded casing and tubing, as well as seamless drill pipe, were found to be a single ‘like or directly

competitive’ product by Chairman Stephen Koplan, Vice Chairman Deanna Tanner Okun, and Commissioners

Marcia E. Miller and Jennifer A. Hillman, while Commissioners Lynn M. Bragg and Dennis M. Devaney found

seamless and welded OCTG to be part of broader product groupings including all seamless carbon and alloy steel

tubular products and all welded carbon and alloy steel tubular products, respectively. See, e.g., Steel, Inv. No. TA201-73, Volume I: Determinations and Views of Commissioners, USITC Publication 3479, December 2001, pp. 17-

18; 152-154; 274-275; and 318-319.

 5 Institution and Scheduling of an Investigation under Section 202 of the Trade Act of 1974 (19 U.S.C. 2252) (the

Act), 66 FR 35267, July 3, 2001.

 6

 19 U.S.C. § 2251.

 7 Consolidation of Senate Finance Committee Resolution Requesting a Section 201 Investigation with the

Investigation Requested by the United States Trade Representative on June 22, 2001, 66 FR 44158, August 22,

2001.

 8 Steel; Import Investigations, 66 FR 67304, December 28, 2001. Specifically, Chairman Stephen Koplan, Vice

Chairman Deanna Tanner Okun, and Commissioners Marcia E. Miller and Jennifer A. Hillman made a negative

determination with respect to OCTG, while Commissioners Lynn M. Bragg and Dennis M. Devaney dissented,

having made affirmative determinations with respect all seamless carbon and alloy steel tubular products and all

welded carbon and alloy steel tubular products.

 9 Certain Oil Country Tubular Goods From the People’s Republic of China: Final Affirmative Countervailing

Duty Determination, Final Negative Critical Circumstances Determination, 74 FR 64045, December 7, 2009.

 10 Ibid. Issues and Decision Memorandum for the Final Determination in the Countervailing Duty Investigation

of Certain Oil Country Tubular Goods (“OCTG”) from the People’s Republic of China (C-570-944), November 23,

2009.

I-6
! Policy Loans

! Export Loans From the Export-Import Bank of China

! Provision of Steel Rounds for Less Than Adequate Remuneration

! The State Key Technology Project Fund

! ‘‘Two Free, Three Half’’ Program

! Preferential Tax Program for Foreign-Invested Enterprises Recognized as High or New

Technology Enterprises

! Local Income Tax Exemption and Reduction Programs for ‘‘Productive’’ Foreign-Invested

Enterprises

! Income Tax Credits for Domestically Owned Companies Purchasing Domestically Produced

Equipment

! Subsidies Provided in the TBNA and the Tianjin Economic and Technological Development

Area

! Loan and Interest Forgiveness for SOEs

! Provision of Electricity for Less Thank Adequate Remuneration

Table I-2

OCTG: Commerce’s final subsidy determination with respect to imports from China

Entity

Final countervailable subsidy

margin (percent)

Jiangsu Changbao Steel Tube Co. and Jiangsu Changbao

Precision Steel Tube Co., Ltd. 11.98

Tianjin Pipe (Group) Co., Tianjin Pipe Iron Manufacturing Co.,

Ltd., Tianguan Yuantong Pipe Product Co., Ltd., Tianjin Pipe

International Economic and Trading Co., Ltd., and TPCO

Charging Development Co., Ltd. 10.36

Wuxi Seamless Pipe Co, Ltd., Jiangsu Fanli Steel Pipe Co, Ltd,

Tuoketuo County Mengfeng Special Steel Co., Ltd. 14.61

Zhejiang Jianli Enterprise Co., Ltd., Zhejiang Jianli Steel Steel

Tube Co., Ltd., Zhuji Jiansheng Machinery Co., Ltd., and

Zhejiang Jianli Industry Group Co., Ltd. 15.78

All others 13.20

Source: 74 FR 64045, December 7, 2009.

Sales at LTFV

On November 17, 2009, Commerce published a notice in the Federal Register of its preliminary

determination of sales at LTFV with respect to imports from China.11 Table I-3 presents Commerce’s

preliminary dumping margins with respect to imports of OCTG from China.

 11 Certain Oil Country Tubular Goods From the People’s Republic of China: Notice of Preliminary

Determination of Sales at Less Than Fair Value, Affirmative Preliminary Determination of Critical Circumstances

and Postponement of Final Determination, 74 FR 59117, November 17, 2009.

I-7
Table I-3

OCTG: Commerce’s preliminary weighted-average LTFV margins with respect to imports from

China

Producer/Exporter

Preliminary dumping margin

(percent)

Jiangsu Changbao Steel Tube Co., Ltd. 0.00

Tianjin Pipe International Economic and Trading Corp. 36.53

Wuxi Seamless Pipe Co., Ltd. (Separate Rate Company) 36.53

Zhejiang Jianli Co., Ltd. (Separate Rate Company) 36.53

All other Separate Rate Companies 36.53

China-wide 99.14

Note.–Does not reflect revisions published subsequent to the Commission’s initial record-closing date.

Source: 74 FR 59117, November 17, 2009.

THE SUBJECT MERCHANDISE

Commerce’s Scope

Commerce has defined the scope of this investigation as follows:

OCTG, which 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, regardless of end finish (e.g., whether or not plain end, threaded, or

threaded and coupled) whether or not conforming to American Petroleum Institute

(‘‘API’’) or non-API specifications, whether finished (including limited service OCTG

products) or unfinished (including green tubes and limited service OCTG products),

whether or not thread protectors are attached. The scope of the investigation also covers

OCTG coupling stock. Excluded from the scope of the investigation are: casing or

tubing containing 10.5 percent or more by weight of chromium; drill pipe; unattached

couplings; and unattached thread protectors.12

Tariff Treatment

The imported OCTG subject to these investigations are principally classified in the 2009

Harmonized Tariff Schedule of the United States (“HTSUS”) in subheadings 7304.29, 7305.20, and

7306.29, casing and tubing of a kind used in drilling for oil or gas.13 The HTSUS statistical reporting 

 12 Certain Oil Country Tubular Goods From the People’s Republic of China: Final Affirmative Countervailing

Duty Determination, Final Negative Critical Circumstances Determination, 74 FR 64045, December 7, 2009.

 13 The tariff schedule concerning OCTG appears in appendix D. As of February 3, 2007, the HTS classifies

stainless steel separate from “alloy” steel for casing and tubing. The basic structure of the classification system was

maintained but there was renumbering of the six digit subheadings to maintain separate classifications of stainless

steel and other alloy steel. The merchandise covered by the investigations is currently imported under the following

HTSUS statistical reporting numbers: 7304.29.1010, 7304.29.1020, 7304.29.1030, 7304.29.1040, 7304.29.1050,

(continued...)

I-8
numbers are provided for convenience and customs purposes only; the written description of the scope of

the investigation is dispositive. The column 1-general (most-favored-nation) rate of duty for these

statistical reporting numbers, applicable to products subject to the investigations, is free.

THE PRODUCT14

Overview

Steel pipes and tubes are made in circular, rectangular, or other cross sections, and are generally

manufactured by either the welded or seamless production process. Steel pipe and tube manufactured by

either process can be categorized by the carbon and alloy grades used in steel production.15 In addition,

steel pipe and tube can be further categorized by end-use. The American Iron and Steel Institute (AISI)

has defined six such end-use categories: standard pipe, line pipe, structural pipe and tubing, mechanical

tubing, pressure tubing, and oil country tubular goods (OCTG).16

Steel pipes and tubes are generally produced according to standards and specifications published

by a number of organizations, including the American Society for Testing and Materials (ASTM), the

American Society of Mechanical Engineers (ASME), and the American Petroleum Institute (API). 

Comparable organizations in the United Kingdom, Japan, Russia, and other countries also have developed

standard specifications for steel pipes and tubes.

 13 (...continued)

7304.29.1060, 7304.29.1080, 7304.29.2010, 7304.29.2020, 7304.29.2030, 7304.29.2040, 7304.29.2050,

7304.29.2060, 7304.29.2080, 7304.29.3110, 7304.29.3120, 7304.29.3130, 7304.29.3140, 7304.29.3150,

7304.29.3160, 7304.29.3180, 7304.29.4110, 7304.29.4120, 7304.29.4130, 7304.29.4140, 7304.29.4150,

7304.29.4160, 7304.29.4180, 7304.29.5015, 7304.29.5030, 7304.29.5045, 7304.29.5060, 7304.29.5075,

7304.29.6115, 7304.29.6130, 7304.29.6145, 7304.29.6160, 7304.29.6175, 7305.20.2000, 7305.20.4000,

7305.20.6000, 7305.20.8000, 7306.29.1030, 7306.29.1090, 7306.29.2000, 7306.29.3100, 7306.29.4100,

7306.29.6010, 7306.29.6050, 7306.29.8110, and 7306.29.8150. In addition, Commerce states that OCTG coupling

stock covered by the investigations may also enter under the following HTSUS statistical reporting numbers: 

7304.39.0024, 7304.39.0028, 7304.39.0032, 7304.39.0036, 7304.39.0040, 7304.39.0044, 7304.39.0048,

7304.39.0052, 7304.39.0056, 7304.39.0062, 7304.39.0068, 7304.39.0072, 7304.39.0076, 7304.39.0080,

7304.59.6000, 7304.59.8015, 7304.59.8020, 7304.59.8025, 7304.59.8030, 7304.59.8035, 7304.59.8040,

7304.59.8045, 7304.59.8050, 7304.59.8055, 7304.59.8060, 7304.59.8065, 7304.59.8070, and 7304.59.8080. 

 14 Except as noted, information presented in the “Description and Applications” and “Manufacturing Processes”

is drawn from Oil Country Tubular Goods from Argentina, Austria, Italy, Japan, Korea, Mexico, and Spain,

Investigation Nos. 701-TA-363 and 364 (Final) and Investigation Nos. 731-TA-711-717 (Final), USITC Publication

2911, August 1995; from Oil Country Tubular Goods from Argentina, Italy, Japan, Korea, and Mexico,

Investigation Nos. 701-TA-364 (Review) and 731-TA-711 and 713-716 (Review), USITC Publication 3434, June

2001; and from Oil Country Tubular Goods from Argentina, Italy, Japan, Korea, and Mexico, Investigation Nos.

731-TA-711 and 713-716 (Second Review), USITC Publication 3923, June 2007.

 15 Included in alloy grades are heat-resisting, stainless, and “other” alloy grades.

 16 Standard, line, and pressure pipe is generally intended to convey liquids and is typically tested and rated for its

ability to withstand hydrostatic pressure. Structural pipe and tubing is used for load-bearing purposes and

construction, although only small amounts of seamless pipe are used in structural applications. Seamless mechanical

tubing is typically a custom-designed product employed within the automotive industry and by equipment

manufacturers. OCTG are steel pipes and tubes used in the drilling of oil and gas wells and in the conveying of oil

and gas from within the well to ground level.

I-9
Description and Applications

OCTG includes casing and tubing of carbon and alloy steel used in oil and gas wells. Figure I-1

shows a simplified schematic arrangement of a typical well with a system of casing and tubing and figure

I-2 presents a more detailed representation of an oil or gas well, including descriptions of different types

of casing by depth and function.17

Recent advancements in oil and gas exploration technologies, including horizontal drilling18 and

hydraulic fracture,19 have enabled gas wells to reach locations that were previously deemed

cost-prohibitive (figure I-3). In addition, the application of the new technologies also permits more wells

per acre, thus significantly increasing gas production and recoverable reserves.20

Casing is a circular pipe that serves as the structural retainer for the walls of the well with an

outside diameter (O.D.) ranging from 4.5 to 20 inches and a length typically ranging from 34 to 48 feet.21

Casing provides a firm foundation for the drill string22 by supporting the walls of the hole to prevent

caving in both during drilling and after the well is completed. After the casing is set, concrete is usually

pumped between the outside of the casing and the wall of the hole to provide a secure anchor. Casing

also serves as a surface pipe designed to prevent contamination of the recoverable oil and gas by surface

water, gas, sand, or limestone. Casing must be sufficiently strong to carry its own weight and to resist

both external pressure and pressure within the well. Casing can be threaded at both ends and connected

with other casing pieces with couplings or connectors. Because the amount of open hole that can be

drilled at any one time is limited, larger wells require a string of concentric layers of casing rather than a

single casing. Several sizes of casing may be set inside the well after it has been drilled, with the larger

sizes set at the top of the well and the smaller sizes set toward the bottom.

 17 As of December 11, 2009, 393 active rotary rigs were drilling in the United States for oil; 757 for natural gas;

and 11 for miscellaneous products, according to the Baker Hughes North American rotary rig count.

 18 Horizontal drilling is defined as the drilling of any well in which the angle of deviation of the wellbore reaches

at least 80 degrees from the vertical, maximizing the length of wellbore exposed to the formation. As of December

11, 2009, over 48 percent of active rotary rigs in the United States were employing horizontal drilling, according to

the Baker Hughes North American rotary rig count. See Baker Hughes Incorporated found at

http://investor.shareholder.com/bhi/Tools/oil_glossary_g_k.cfm#h, retrieved December 12, 2009.

 19 In a hydraulic fracture process, water, chemical, and sand are injected at high pressure through the holes of the

pipe into the surrounding shale, fracturing it and thereby allowing more gas from the shale to enter the pipe, found at 

http://www.earthworksaction.org/FracingDetails.cfm, retrieved December 12, 2009.

 20 Vello A. Kuuskraa, Unconventional Natural Gas: Industry Savior or Bridge? 2006 EIA Energy Outlook and

Modeling Conference, March 27, 2006, Washington, DC, p. 24.

 21 American Iron and Steel Institute, Instructions for Reporting Steel Shipment Statistics, January 1988, and

ANS/API specification 5CT, Eighth Edition, July 1, 2005.

 22 The drill string is composed of three types of nonsubject products: drill pipes, drill collars, and the drill bit.

I-10
Figure I-1

Casing and tubing: Simplified diagrammatic representation of a well showing the casing strings

and production tubing

Source: Introduction to Oil and Gas Production, Fifth Edition, American Petroleum Institute, June 1996, p. 11.

I-11
Figure I-2

Casing and tubing: Subsurface components of an oil or gas well, including descriptions of

different types of casing by depth and function

Source: La Plata Energy Council (Durango, CO), from http://www.energycouncil.org/images2/CasingDiag.gif, 

retrieved on March 20, 2007.

I-12
Figure I-3: Casing and Tubing for shale gas drilling technology

Source: Washington Post, found at 

http://www.washingtonpost.com/wp-dyn/content/graphic/2009/12/02/GR2009120204488.html, retrieved December 6,

2009.

I-13
Tubing is a smaller-diameter pipe (between 1.050 and 4.500 inches in O.D.) installed inside a

larger-diameter casing that is used to conduct the oil or gas to the surface either through natural flow or

through pumping.23 Substances (such as lubricant) are also pumped into the well through the tubing for

well treatment. Tubing must be strong enough to support its own weight, that of the oil or gas, and that of

any pumping equipment suspended on the string. Tubing, like casing, usually is produced in accordance

with API specification 5CT.24

Coupling stock is a seamless tubular product used to make a coupling blank which, in turn, is

used to produce coupling.25 Coupling is a thick-walled and internally threaded cylinder that is used for

joining two lengths of threaded pipe. Coupling typically accounts for 2 to 3 percent of the weight of endfinished tubing or casing.

Manufacturing Processes

The manufacturing process for casing and tubing includes forming and finishing phases. The

forming phase takes place entirely at the manufacturing facility or mill. Finishing, by contrast, may take

place at the mill or at a processing or threading facility.

Forming Phase

OCTG mills manufacture casing and tubing either by the seamless process or by the electric

resistance-welding (“ERW”) process, a lower cost method than the seamless process, depending on the

service requirements. By contrast, mills manufacture coupling stock for OCTG couplings exclusively

through the seamless process.

In the ERW process (figure I-4), the input is steel sheet in coil form. The steel sheet is slit to the

width which corresponds to the desired diameter of the tube. The slit sheet passes through a series of

rollers while at ambient temperature and forms a tubular shape. The edges are then heated by electric

resistance26 and welded by heat and pressure, without the addition of filler metal. The welding pressure

 23 American Iron and Steel Institute, Instructions for Reporting Steel Shipment Statistics, January 1988.

 24API specification 5CT designates grades for both casing and tubing. These grades include a letter (e.g., H, J, K)

which typically corresponds to a minimum tensile strength level (with “H” being the weakest and “Q” the strongest),

followed by a number (e.g., 55, 80). The number specifies the minimum yield strength in thousands of pounds per

square inches (psi) of the pipe material. Thus, grade J55 or K55 requires that the subject OCTG has minimum yield

strength of 55,000 psi but differs in minimum tensile strength. An OCTG grade may include several types. Each

specific grade, in combination with a specific type (e.g., grade L80, type 9 Cr), is required to have certain

mechanical properties (including yield strength), chemical compositions, methods of production (seamless or

welded), heat treatments, testing procedures, and other engineering specifications, depending on customers’

requirements. For example grade L80, type 1 contains no chromium, can be seamless or welded, and the pipe has to

be quenched and tempered. Grade L80, type 9 Cr must contain between 8 to 10 percent chromium by weight, is

seamless, tempered and quenched. Certain OCTG must be heat treated to achieve particular physical characteristics

and grade. For example, to reduce system weight by using thinner-walled pipe, well operators employ a light-walled

high-strength casing made from high grade steel.

 25 Coupling blank, as the name implies, is not threaded.

 26 The heat for welding is generated by resistance of the steel to the flow of electric current. In one process, a low

frequency (typically 60 to 360 hertz) is conducted to the strip edges by a pair of copper alloy discs which rotate as

the pipe is propelled under them. A second variation uses high frequency current (in the range of 400 to 500

kilohertz) which enters the tubing through shoes which act as sliding contacts. An induction coil can also be used

with the high frequency current to induce current in the edges of the steel. No direct contact between the induction

coil and the tubing is required. American Iron and Steel Institute, Steel Products Manual Steel-Specialty Tubular

(continued...)

I-14
causes some of the metal to be squeezed from the joint, forming a bead of metal on the inside and the

outside of the tube. This bead, or welding flash, is usually trimmed from both the outside and the inside

surfaces.

Seamless OCTG (figure I-5) is manufactured by either of two high temperature methods to form a

central cavity in a solid steel billet, namely, the rotary piercing method and the hot extrusion method. The

input for seamless tubing is a round or square steel billet. If a square billet is used, it is first forced

through a single circular roll pass, producing a round billet for the piercing operation.

Finishing Phase

Subsequent to the forming phase, the pipe is heat-treated, upset, and threaded. U.S. pipe mills

typically are equipped with the facilities necessary to perform these processes. However, there are

various non-pipe producers, known as processors or threaders, that can perform certain aspects of the

finishing operations. Independent processors operate facilities that are capable of full body heat treatment

as well as upsetting ends.27 Threaders are capable of threading and coupling, hydrostatic testing, and

measuring the length of OCTG products. Some processors and threaders may also manufacture couplings

that become part of the finished OCTG.28 According to an industry source, processors and threaders

mainly serve imports since OCTG are often imported as plain ends, and are upset, threaded and heattreated in the United States. This approach provides distributors with the flexibility to process and thread

the product in compliance with a variety of specifications, thus allowing them to serve a variety of

consumer needs.29

In the rotary piercing method, the heated billet is gripped by angled rolls, which cause it to rotate

and advance over a piercer point, forming a hole through its length. In the extrusion method, the billet is

hot punch-pierced and then extruded axially through a die and over a mandrel, forming a hollow shell.

The hollow shell produced by either method is then rolled with a fixed plug or with a continuous

mandrel inside the shell to reduce the wall thickness and increase the length. Finally, the shell is rolled in

a sizing mill or a stretch reducing mill where it is formed to size.

 26 (...continued)

Products, October 1980, pp. 19–20.

 27 Most processors are also threaders but there are many threaders that are not processors. For this reason, the

term “processor” in this and other sections of this report is meant to include processors who are also threaders. 

Discussion of independent threaders is limited in this report, as the Commission in recent OCTG investigations has

not deemed threaders to be part of the domestic industries producing casing and tubing. Oil Country Tubular Goods

from Argentina, Italy, Japan, Korea, and Mexico, Investigation Nos. 731-TA-711 and 713-716 (Second Review),

USITC Publication 3923, June 2007, p. I-35.

 28 Oil Country Tubular Goods from Argentina, Italy, Japan, Korea, and Mexico, Investigation Nos. 731-TA-711

and 713-716 (Second Review), USITC Publication 3923, June 2007, p. I-35.

 29 ***, staff telephone interview, May 8, 2009.

I-15
Figure I-4

Casing and tubing: ERW manufacturing process

Source: JFE OCTG (Catalog), p. 9, from http://www.jfe-steel.co.jp/en/, retrieved on March 20, 2007.

I-16
Figure I-5

Casing and tubing: Seamless manufacturing process

Source: JFE OCTG (Catalog), p. 8, from http://www.jfe-steel.co.jp/en/, retrieved on March 20, 2007.

I-17
Finishing Phase

Subsequent to the forming phase, the pipe is heat-treated, upset, and threaded. U.S. pipe mills

typically are equipped with the facilities necessary to perform these processes. However, there are

various non-pipe producers, known as processors or threaders, that can perform certain aspects of the

finishing operations. Independent processors operate facilities that are capable of full body heat treatment

as well as upsetting ends.30 Threaders are capable of threading and coupling, hydrostatic testing, and

measuring the length of OCTG products. Some processors and threaders may also manufacture couplings

that become part of the finished OCTG.31 According to an industry source, processors and threaders

mainly serve imports since OCTG are often imported as plain ends, and are upset, threaded and heattreated in the United States. This approach provides distributors with the flexibility to process and thread

the product in compliance with a variety of specifications, thus allowing them to serve a variety of

consumer needs.32

Heat treatment

In steel manufacturing processes, specific engineering characteristics can be achieved through the

application of different heat treatments.33 Heat treating may involve one or more heating cycles in either

a continuous furnace or in a batch furnace, with controlled rates of cooling. Specific heat treating

requirements depend on the grade of steel being processed. For welded pipe, the heat treatment (which

may be performed while the pipe is still in the continuous processing line) may cover the welded seam

only or the full cross-section of the pipe. API standards specify a documented procedure for every

 30 Most processors are also threaders but there are many threaders that are not processors. For this reason, the

term “processor” in this and other sections of this report is meant to include processors who are also threaders. 

Discussion of independent threaders is limited in this report, as the Commission in recent OCTG investigations has

not deemed threaders to be part of the domestic industries producing casing and tubing. Oil Country Tubular Goods

from Argentina, Italy, Japan, Korea, and Mexico, Investigation Nos. 731-TA-711 and 713-716 (Second Review),

USITC Publication 3923, June 2007, p. I-35.

 31 Oil Country Tubular Goods from Argentina, Italy, Japan, Korea, and Mexico, Investigation Nos. 731-TA-711

and 713-716 (Second Review), USITC Publication 3923, June 2007, p. I-35.

 32 ***, staff telephone interview, May 8, 2009.

 33 During the steel making process, certain alloys are added to the mix to achieve the desired characteristics. The

American Iron and Steel Institute specifies three broad categories of steels, depending on their chemical

compositions: (1) The first group is carbon steels containing by weight 2 percent or less of carbon. Carbon steel is

used in standard applications. (2) The second group is stainless steels containing by weight 1.2 percent or less of

carbon and 10.5 percent or more of chromium, with or without other elements and a minimum of 50 percent iron. 

These steels are used in applications requiring resistance to oxidation and corrosion. These products are excluded

from the subject investigations. (3) Alloy steels are those that are not classified as carbon or stainless steels and have 

specified maximum contents of elements including manganese, silicon, copper, nickel, lead or any other elements

added to obtain a desired alloying effect. Depending on the specific applications, OCTG are required to be made

from a specific category of steel as determined by its grades and types. For standard operations, OCTG of grades

H40, J55, K55, and N80 are used. For severe services including harsh weather or high stress operations, higher

grades of OCTG are required. Specification for API grades are found in API, Specification for Casing and Tubing

(U.S. Customary Units), API Specification 5CT, 1995; also in (Tenaris) Oilfield Services: Products and Services for

the Oil and Gas Industry, retrieved on May 5, 2007 from

http://www.tenaris.com/en/ProductsServices/Oilfield/pro_ser_propietary.asp.

I-18
particular grade and type of pipe.34 API-specified heat treatment processes in the production of casing

and tubing include (1) annealing, (2) normalizing, and (3) quenching and tempering.35

Annealing is a single heat treatment process that prepares the steel for fabrication or service. The

steel is heated to a temperature in or near a specific range, and cooled at a predetermined rate or cycle. 

The designed properties of the steel, as specified by the customer, will determine the temperature, rate and

cycle. Annealing relieves internal residual stresses or hardness induced by welding, by cold working, or

by machining.

In the normalizing process, the pipe is heated above a specific temperature, held at this

temperature for a specified time, and then air-cooled. Normalizing refines the steel grain size and obtains

a carbide size and distribution which will be more suitable for future heat treatment than the as-rolled

structure.36

Quenching and tempering is a sequential process in which the pipe is heated to a specific

temperature for a specified period of time to modify the steel’s micro-structure and then “quenched” in a

cooling medium such as water, oil, or air, depending on the thickness of the pipe. After quenching, the

steel is very brittle and must be reheated and then cooled under specific conditions. This process is called

“tempering.”37 The pipe must undergo a specified process of quenching and tempering in order to qualify

for specific API grade.

Depending on the pipe design, API standards may specify a single heat treatment process or a

combination of processes for the pipe such as normalizing, normalizing and tempering, or quenching and

tempering. Subsequent to heat treatment, sizing rolls will shape the tube to accurate diameter tolerances. 

The product is cooled and then cut to length at the end of the tube mill.38

Coupling stock is made to the same grade and type specifications as casing and tubing. It must

also be subject to the same heat treatment as pipe except where specified by the purchaser.39

Upsetting and threading

Casing and tubing are finished by threading and the attachment of a suitable coupling to one end

of each length. For some casing or tubing that is subject to severe or sour service,40 it is necessary to 

 34 American Petroleum Institute, Specification for Casing and Tubing (U.S. Customary Units), API Specification

5CT, Fifth Edition, April 1, 1995, table 1: Process of Manufacture and Heat Treatment, p. 5.

 35 American Iron and Steel Institute, Steel Product Manual, Steel Specialty Tubular Products, October 1980,

p. 26.

 36 United States Steel, “Principles of Heat Treatment of Steel,” in The Making, Shaping, and Treating of Steel,

10th ed. (Pittsburgh, PA: Herbick & Held, 1985), p. 1262.

 37 These processes are specified by the American Petroleum Institute, Specification for Casing and Tubing (U.S.

Customary Units), American Petroleum Institute Specification 5CT, Fifth Edition, April 1, 1995, table 1, p. 5.

 38 United States Steel, “Manufacture of Steel Tubular Products,” in The Making, Shaping, and Treating of Steel,

10th ed. (Pittsburgh, PA: Herbick & Held, 1985), p. 1029.

 39 Coupling blanks may be obtained from coupling stock, forgings (shaped by pressure) or centrifugal casting.

Specification for Casing and Tubing, API Specification 5CT, Fifth Edition, April 1, 1995. 

 40 Sour crude oil (sour crude) or sour gas is defined as an oil/gas containing common impurities such as water,

carbon dioxide, hydrogen sulfide, and oxygen, which are thoroughly mixed in with the oil during extraction, and are

very difficult to eliminate. These impurities corrode and cause cracking in steel, albeit without any observable

change in appearance prior to failure.

I-19
provide additional strength in the joint, and for this reason, the ends of the pipe are upset before the

threads are cut. In the upsetting process, the end of the pipe is heated to forging temperature, then

inserted endwise into an upsetting machine. The machine pushes the hot metal back, creating a thicker

wall at the end of the pipe. The upsetting may be controlled to displace the extra thickness to the inside

or to the outside of the pipe.

Tubing and casing can be joined directly using male (outer) and female (inner) threading, or by

using couplings with female threads on each end.41 Typically, the pipe is mounted on a lathe and threads

are cut by using sharp steel cutting tools (called chasers) which are mounted on a threading die

surrounding the pipe. As the pipe is turned on the lathe, the threading die moves along the pipe’s axis,

producing the required spiral cut on the inner or outer surface of the pipe. High quality thread must be

clean and smoothly cut and the die must be properly designed and correctly set up.42

API standards specify three different types of threaded joints: short round thread casings and

couplings, which are primarily used in surface pipe; long round thread casings and couplings, which

feature stronger thread than short round threads and are used in deep string applications; and buttress

threads, which have the same length as long threads, but are square and stronger than round thread.43

Propriety threading, in contrast, that is specially designed, registered, and protected by patents or other

intellectual property right mechanisms and is not specified by the API standards.

After threading, the thread is protected by a thread protector during handling, transportation or

storage.44 The protector is a metal or plastic cap which is screwed on to the pipe thread as specified by

API standards. API also specifies that processors add a lubricant called “thread dope” between the pipe

and the protector. This lubricant fills the gap between the cap and the pipe to prevent water penetration

during handling, transportation or storage.

DOMESTIC LIKE PRODUCT ISSUES

Parties have raised no issues with respect to domestic product that is “like” the subject

merchandise in these investigations. The petitioners initially proposed a domestic like product consisting

of oil country tubular goods other than drill pipe and high-chromium casing and tubing, consistent with

their proposed scope.45 Respondents did not object to this definition of the domestic like product.

However, the scope language included in Commerce’s notice of initiation for these investigations

included an element not explicit in the petition’s proposed scope: in addition to casing and tubing, it also

covered OCTG coupling stock, while excluding finished (unattached) coupling.46 Accordingly, when

issuing draft questionnaires for the final phase of these investigations, Staff requested additional

 41 Some drive pipes or surface pipes which are connected together by a few joints near the ground surface can be

welded together.

 42 United States Steel, “Manufacture of Steel Tubular Products,” in The Making, Shaping, and Treating of Steel,

10th ed. (Pittsburgh, PA: Herbick & Held, 1985), p. 1059.

 43 American Petroleum Institute Specification 5CT, Fifth Edition, April 1, 1995, Specifications for Casing and

Tubing (U.S. Customary Units), p. 34.

 44 Threading can be performed after transportation to avoid damage which can be caused by movement, water, or

weather. Damaged thread can cause expensive ruptures of the pipe string in casing and tubing applications where

pipes are connected to one another by threaded joints.

 45 Petition, p. 5.

 46 Oil Country Tubular Goods From the People’s Republic of China: Initiation of Antidumping Duty

Investigation, 74 FR 20671, May 5, 2009.

I-20
comments regarding data and other information collection with respect to coupling stock.47 The

petitioners did not believe that additional data collection or examination of coupling stock as a potential

separate like product was necessary, while respondents did not address the issue.48

OCTG coupling stock is produced as a seamless, rather than welded, tubular product.49 Like

casing and tubing, OCTG coupling stock is provided for by API specification 5CT. Because OCTG

coupling stock constitutes the feedstock for finished OCTG couplings, it must match the chemistry and

physical properties of the casing or tubing that is to be joined by coupling. Like casing, coupling stock

can be sold in relatively long lengths; however, coupling stock typically is produced with a heavier wall

than comparable casing or tubing.50

As noted above, OCTG coupling stock is produced by seamless pipe producers but not welded

pipe producers.51 *** producers, ***, reported producing OCTG coupling stock on production lines

shared with casing and tubing. *** did not report producing coupling stock on shared production lines,

although the corporate website of *** characterizes the company as “***” and provides a coupling stock

fact sheet.

As discussed above, coupling stock is offered in the same grade and general dimensions as casing

and tubing. However, coupling stock is generally a thicker, heavier product than comparable casing or

tubing.52 Nonetheless, if produced in intermediate sizes, coupling stock reportedly can be produced in

similar wall and diameter combinations as seamless casing.53

As noted above, U.S. producers that addressed this issue viewed OCTG coupling stock as a form

of OCTG, rather than a separate product.54 However, coupling stock can be sold through different

distribution channels (i.e., consumed internally to produce couplings in-house or sold commercially to

coupling manufacturers).55 In terms of pricing, coupling stock is reportedly priced higher than

comparable casing and tubing by *** percent, largely as a result of its heavier wall requirements.56

 47 Staff correspondence to parties transmitting draft questionnaires, dated September 3, 2009 (“Commerce’s scope

now includes details regarding coupling stock that do not appear in the scope language for previous investigations. 

Should the Commission collect separate data, or even examine the traditional like product factors, with respect to

coupling stock?”).

 48 See generally correspondence from U.S. Steel; Maverick; and V&M Star, TMK IPSCO, Evraz Rocky

Mountain Steel, Wheatland, and the USWA; and the Chinese respondents, dated September 11, 2009. Staff notes

that the collection of certain data (e.g., import data) was required because coupling stock is not provided for in the

same HTS subheadings as casing and tubing.

 49 Correspondence from V&M Star, TMK IPSCO, Evraz Rocky Mountain Steel, Wheatland, and the USWA,

September 11, 2009, p. 2.

 50 Staff interview with ***, November 12, 2009.

 51 Staff notes that for welded standard pipe, couplings are often produced from welded tubular feedstock. Line

pipe, whether welded or seamless, typically requires no couplings, as it is generally welded in the field.

 52 See, e.g., U.S. Steel’s listing of tubular products / coupling stock. For this reason, coupling stock quotations

often include the finished bore size, or FBS. U.S. Steel Tubular Products, found at

http://www.ussteel.com/corp/tubular/coupling-stock.asp, retrieved November 4, 2009.

 53 Staff interview with ***, November 12, 2009.

 54 Correspondence from V&M Star, TMK IPSCO, Evraz Rocky Mountain Steel, Wheatland, and the USWA,

September 11, 2009, p. 2 

 55 Correspondence from V&M Star, TMK IPSCO, Evraz Rocky Mountain Steel, Wheatland, and the USWA,

September 11, 2009, p. 2 

 56 Staff interview with ***, November 12, 2009.

I-21
 
PART II: CONDITIONS OF COMPETITION IN THE U.S. MARKET

U.S. MARKET CHARACTERISTICS

OCTG is sold across the United States to distributors and, ultimately, to production and

exploration firms, with sales concentrated in major oil- and gas-producing regions. Three U.S. producers

supply OCTG nationally. Of the remaining responding producers,1

 four reported sales of OCTG in the

Central Southwest; three reported sales in the Mountain region; three in the Midwest; two in the

Southeast; two in the Northeast; two in the West Coast region; and one in the Northwest. Also, three

responding producers specifically reported making sales in Alaska, and one producer reported sales in

Hawaii. Eight importers reported that they supply OCTG nationally. Of the remaining 26 responding

importers, 6 importers supply only to the Central Southwest and 14 importers supply to two or more

regions, mainly to the Central Southwest (12), the Mountain region (11), and the West Coast (5).

CHANNELS OF DISTRIBUTION

Domestically-produced and imported OCTG are sold mainly through distributors (table II-1). 

During the period for which data were collected, U.S. producers shipped 99 percent of their OCTG to

distributors. U.S. importers shipped more than 90 percent of OCTG sales of imports from China to

distributors in 2006, 2007 and 2009, and 84 percent in 2008. U.S. importers shipped more than

93 percent of imported OCTG from nonsubject sources to distributors in 2006-08, and about 89 percent in

2009.

Table II-1

OCTG: U.S. producers’ and importers’ shares of reported U.S. shipments, by sources and

channels of distribution, 2006-08, January-September 2008, and January-September 2009

Item

January-September

2006 2007 2008 2008 2009

Share of reported shipments (percent)

Domestic producers’ shipments: 

 To distributors 99.1 99.6 99.3 99.6 98.7

 To end users 0.9 0.4 0.7 0.4 1.3

Shipments of imports from China:

 To distributors 93.0 90.4 84.0 86.3 91.8

 To end users 7.0 9.6 16.0 13.7 8.2

Shipments of imports from nonsubject sources:

 To distributors 96.0 94.5 93.3 95.4 89.3

 To end users 4.0 5.5 6.7 4.6 10.7

Total imports:

 To distributors 94.4 92.0 87.1 90.1 90.7

 To end users 5.6 8.0 12.9 9.9 9.3

 Source: Compiled from data submitted in response to Commission questionnaires.

 1 “Producer” refers to mills and processors that responded to the Commission’s producer questionnaire, or

otherwise provided information to the Commission.

II-1
SUPPLY AND DEMAND CONSIDERATIONS

Supply

U.S. Supply

Based on available information, U.S. producers have the ability to respond to changes in demand

with moderate to high changes in the quantity of shipments of U.S.-produced OCTG to the U.S. market. 

The main factors contributing to the moderate degree of responsiveness of supply are the availability of

unused capacity, some inventories, and the existence of alternative markets and production alternatives.

Industry capacity

Capacity utilization for U.S. producers increased irregularly from 68.5 percent in 2006 to

69.0 percent in 2008, but was only 17.6 percent in January-September 2009 compared with 67.6 percent

in January-September 2008. While rolling capacity remained available, heat treating capacity was far

more constrained, at least during 2006-08, limiting the ability of certain U.S. producers to increase

production of seamless alloy steel OCTG that requires heat treatment.

Alternative markets

Exports of OCTG decreased irregularly from *** percent of U.S. producers’ total shipments in

2006 to *** percent in 2008; exports accounted for *** percent in January-September 2009 compared

with *** percent in January-September 2008. 

Inventory levels

U.S. producers’ inventories as a ratio of their total OCTG shipments fluctuated between 2006 and

2008, decreasing irregularly from *** percent of their shipments in 2006 to *** percent in 2008. 

Inventories accounted for *** percent of annualized shipments in September 2009, compared with ***

percent in September 2008. 

Production alternatives

U.S. producers produce welded and seamless oil/gas well casing and tubing, mechanical tubing,

and standard/line/pressure pipe on the same equipment used to produce OCTG. According to

questionnaire responses, approximately one-third of shared welded production in 2008 was other (nonOCTG) welded products and about one-fourth of shared seamless production was other seamless

products.2

 2 Table III-4.

II-2
Supply constraints

U.S. producers were asked if they refused, declined, or were unable to supply OCTG since

January 1, 2003.3 4

 Five of the seven responding producers reported that they did have restrictions of

some variety in place since that time. Some companies provided additional comments in their

questionnaire responses. Producer *** stated that “***.” Producer *** reported that “***.” Producer

*** reported that “***.” Producer *** declared that “***.” Producer *** explained that “***.” ***, one

of the responding producers that reported no restrictions, also reported that it had *** it was *** on some

orders.

Supply of Subject Imports from China

Based on available information, Chinese producers have the ability to respond to changes in

demand with moderate to high changes in the quantity of shipments of OCTG to the U.S. market. The

main contributing factors to the moderate to high degree of responsiveness are the existence of some

unused capacity, some inventories, and the existence of home and non-U.S. export markets sales.5

Industry capacity

Chinese producers’ reported capacity utilization rates for OCTG increased irregularly from

81.1 percent in 2006 to 83.4 percent in 2008, and are projected to be 70.9 percent in 2009 and

72.7 percent in 2010. Accordingly, Chinese producers have some excess capacity with which they could

increase OCTG production.6

Alternative markets

Commercial shipments of OCTG to the Chinese home market, as a percentage of total shipments,

decreased from 75.6 percent in 2006 to 59.6 percent in 2008. Chinese OCTG producers’ exports to the

United States, as a percentage of total shipments, increased from 10.0 percent in 2006 to 22.9 percent in

2008. Chinese producers’ exports of OCTG to non-U.S. markets, as a percentage of total shipments,

increased irregularly from 12.1 percent in 2006 to 15.1 percent in 2008. These data indicate that Chinese

producers have the ability to shift shipments from alternative markets in response to price changes.

Inventory levels

Available data indicate that Chinese OCTG producers’ inventories, as a percentage of total

shipments, increased from *** percent in 2006 to *** percent in 2007, and decreased to *** percent in

2008. Inventories are projected to rise in 2009 to *** percent, but projected to decrease to *** percent in

2010. These data indicate that subject producers may be somewhat limited in their ability to use

inventories as a means of increasing shipments of OCTG to the U.S. market.

 3 This includes placing customers on allocation or “controlled order entry,” declining to accept customers or

renew existing customers, delivering less than the quantity promised, or failing to meet timely shipment

commitments. 

 4

 Three of 50 purchasers reported problems with their contracts: purchaser *** reported that ***; purchaser ***

reported that in ***; purchaser *** reported that ***. 

 5

 Petitioners contend that ***. U.S. Steel Prehearing Brief, p. 60.

 6

 ***. Respondents’ posthearing brief, exhibit 17.

II-3
Production alternatives

Chinese OCTG producers reported producing welded and seamless oil/gas well casing and

tubing, OCTG coupling stock, drill pipe, mechanical tubing, and standard/line/pressure pipe on the same

equipment used to manufacture OCTG. They also reported that three-quarters of shared welded

production is other welded products and more than one-third of shared seamless production is other

seamless products.7

Supply Constraints

Importers of Chinese subject product were asked if they had refused, declined, or been unable to

supply OCTG since January 1, 2006. Twelve of 31 responding importers of Chinese subject product

reported that they had restrictions of some nature in place. Some companies provided additional

comments in their questionnaire responses. Importer *** reported that during March 2008-December

2008 it ***. Importer *** reported that it ***. Importer *** reported that ***.

Distributor and User Inventories

Distributor and user inventories were relatively stable during January 2006-June 2008. 

According to U.S. producers’ testimony during the hearing, market participants prefer to see inventories

at or below six months of supply.8

 According to public data compiled by Preston Publishing, the absolute

level of OCTG inventories began to increase from mid-2008 until March 2009, and then decreased over

the remainder of the period (Figure II-1). However, because of the steep decline in operator consumption,

the months of supply on hand were substantially higher in 2009 than in the previous years (Table II-2).

Figure II-1

OCTG: U.S. inventory levels and months’ supply on hand, January 2006-October 2009

Source: Preston Publishing Co.

 7 Table VII-5.

 8

 Hearing transcript, p. 56 (Sutton).

II-4
Table II-2

OCTG: Number of months of supply on hand, January 2006-October 2009

2006 2007 2008 2009

January 5.9 6.9 6.1 10.2

February 5.4 6.6 5.7 12.1

March 5.5 6.6 5.5 14.3

April 5.3 6.6 5.4 15.2

May 5.5 7.0 5.3 16.3

June 5.5 7.2 5.3 15.8

July 5.5 7.0 5.4 14.3

August 5.3 7.2 5.5 13.0

September 5.8 7.3 5.9 11.8

October 5.9 6.6 6.7 10.9

November 6.5 6.4 7.5 – 

December 6.7 5.9 8.5 – 

Source: Calculated from data provided by Preston Publishing Co.

U.S. Purchasers’ Inventories 

Purchasers were asked to report their end-of-period inventories of OCTG from the United States,

China, and from all other countries.9

 Reported end-of-period inventories of domestic OCTG decreased

from 455,467 short tons in December 2006 to 403,753 short tons in December 2007 and increased to

494,226 short tons in December 2008. Inventories reported by responding purchasers were 375,044 short

tons in September 2009 compared with 418,580 short tons in September 2008.

Purchasers’ reported inventories of Chinese OCTG increased from 89,671 short tons in December

2006 to 112,215 short tons in December 2007 and to 347,559 short tons in December 2008. These

inventories were 309,320 short tons in September 2009 compared with 284,430 short tons in September

2008.

Purchasers’ inventories of OCTG from nonsubject countries decreased from 115,082 short tons in

December 2006 to 91,745 short tons in December 2007 and then increased to 222,825 short tons in

December 2008. Inventories were 177,454 short tons in September 2009 compared with 142,983 short

tons in September 2008.

Purchasers were asked to discuss changes in the levels of their firms’ inventories and purchases

of OCTG. Of the responding purchasers, 14 firms reported higher-than-desired inventories at the end of

2008 and into 2009: the inventory build-up was generally attributed to shortages and longer delivery

periods of domestic OCTG during 2008. Twelve purchasers reported purchasing foreign OCTG to satisfy

the high demand in 2008. Three firms specified purchasing OCTG from China, three firms mentioned

Korea, and one mentioned Japan.

 9 Thirty-six responding purchasers reported usable data: 24 distributors, 6 end users, and 6 other type of firms

(2 importers, 1 manufacturer and reseller, 1 processor, 1 steel trader, and 1 broker).

II-5
Quantity (in short tons)

Item

Calendar years January-September

2006 2007 2008 2008 20091

End-of-period inventories of OCTG from:

United States 455,467 403,753 494,226 418,580 375,044

China 89,671 112,215 347,559 284,430 309,320

Other countries 115,082 91,745 222,825 142,983 177,454

 1 Purchasers that reported inventories were asked to review their responses and to estimate the quantity of

“shale-ready” casing (casing with particular attributes that makes it well-suited for use in drilling in shale plays) for

inventories held as of September 30, 2009. Fifteen of 36 purchasers responded to the Commission’s question: 0.6

percent of purchasers’ inventories of U.S. OCTG consisted of the specified welded casing; 7.7 percent of

purchasers’ inventories of U.S. OCTG consisted of the specified seamless casing; 9.4 percent of purchasers’

inventories of Chinese OCTG consisted of the specified seamless casing; and 0.3 percent of purchasers’ inventories

of nonsubject OCTG consisted of the specified seamless casing.

Note.--According to testimony provided at the hearing, certain types of casing are preferred for drilling operations in

the shale plays. Hearing transcript, pp. 359 (Dunn) and 406-408 (Dunn). To provide greater clarity into purchaser

inventory holdings, Staff requested purchasers to quantify their September 2009 holdings of welded casing grade P110 in diameters of 4-1/2 through 5-1/2 inches (inclusive) in lengths of 42 feet or less, and seamless casing grade

P-110 in diameters of 4-1/2 through 7-5/8 inches (inclusive) in lengths of 42 feet or less. The responses to this query

included not only data but also certain clarifications. Specifically, the importance of casing length tends to reflect the

type of drill rig in use, rather than (necessarily) the area in which the rig is engaged. “Flex” rigs using automated

casing handlers reportedly are more likely to utilize shorter lengths of casing. Such rigs are reportedly used in the

shale plays because of their mobility. However, they are not used exclusively in the shale plays, nor are the shale

plays exclusively serviced by such rigs. Moreover, flex rigs can be operated without using the automated casing

handling system. Staff telephone interview with ***, December 7, 2009. Staff also received feedback suggesting

that a range of grades of OCTG can be employed in the shale plays. See, e.g., Response to ITC Questions from ***

(“The sizes, weights and grades that are utilized in these areas are commonly used items in all facets of our

industry. For example, P-110 grade pipe is not the only type of pipe used in shale plays - large volumes of carbon

grade pipe and other alloy grades (such as N-80) are also used in shale drilling. Furthermore, all of the OCTG used

in shale drilling is also commonly used in vertical drilling.”).

Demand

Based on available information, it is likely that changes in the price level of OCTG will result in a

small change in the quantity of OCTG demanded. The main contributing factors to the small degree of

responsiveness of demand are the lack of substitute products for OCTG and the fact that OCTG represents

a low to moderate share of overall drilling costs. 

Demand Trends

Apparent U.S. consumption decreased between 2006 and 2007, then increased sharply in 2008,

but during the first three quarters of 2009 was less than one-half the level of apparent U.S. consumption

in the comparable interim period of 2008. However, this measure does not take into account changes in

importer, distributor, or end user inventories. According to public data compiled by Preston Publishing,

OCTG operator consumption decreased moderately in 2007 relative to 2006. After February 2008,

operator consumption increased until October 2008, then decreased through June 2009 and has been

rising through October 2009 (figure II-2).

II-6
Figure II-2

OCTG operator consumption, by month, January 2006-October 2009

Source: Preston Publishing Co.

U.S. Demand

One of the responding U.S. producers reported that U.S. demand increased, three reported that

demand fluctuated, and three indicated that demand decreased. The producers that reported increased or

fluctuating demand added that demand increased in 2006, stabilized in 2007, increased dramatically

through mid-2008, and then decreased substantially thereafter. When asked to describe their firms’

ability to forecast and respond to changes in demand, four producers reported that, despite their

experience in the OCTG market, they were unable to forecast the increase in Chinese imports and the

dramatic drop in natural gas and oil prices which caused the decrease in drilling activity.10 Another

producer added that OCTG demand not only dropped in late 2008 due to low gas and oil prices, but

demand for U.S. mill-produced OCTG “***.”11

Sixteen of 31 responding importers indicated that demand for OCTG has increased since 2006. 

Similar to the U.S. producers’ responses, most of these firms indicated that demand had increased because

of higher prices for crude oil and natural gas that generated greater incentives to drill more wells to

produce more hydrocarbons. Of the remaining responding importers, six indicated that demand had

fluctuated, and nine reported that demand decreased. These latter responding importers indicated that

demand decreased in the most recent period because the oil and gas prices decreased steeply, reducing the

incentive to drill and resulting in a decrease in oil and rig counts. 

When asked to describe their firms’ ability to forecast and respond to changes in demand ***,

reported that they used trade publications to forecast market conditions, *** reported they were not able

to forecast the recent decline in demand, *** reported that it was in a good position to predict demand but

not the impact of imports, and *** reported that the decline in demand in 2009 was unpredicted. Eleven

importers reported no ability or limited ability to forecast OCTG demand with any degree of accuracy. 

 10 *** U.S. producers’ questionnaires.

 11 *** U.S. producers’ questionnaire.

II-7
Five importers reported that they only purchase to order, and, when orders decrease, they cut expenses to

remain in business.

Twenty-nine of 39 responding purchasers indicated that demand in the United States for OCTG

has fluctuated since 2006. Most of these firms indicated that, while demand had increased from January

2006 until mid-to-late 2008 due to the increase in the prices for crude oil and natural gas, demand

decreased in late 2008 when the oil and gas prices decreased steeply, reducing the incentive to drill and

resulting in a decrease in oil and rig counts. Of the remaining responding purchasers, seven indicated that

demand had increased, one indicated that demand stayed the same, and two reported that demand

decreased.12 

Purchasers that are end users of OCTG were asked to describe how demand for their final

products incorporating OCTG has changed since January 2006. Ten of 12 responding purchasers

reported that demand for their final products has fluctuated, and the remaining 2 purchasers reported that

demand has increased. Similar to demand for OCTG, demand for the final products incorporating OCTG

depends on drilling activity that is closely tied to oil and natural gas prices, as well as general economic

activity and commodity prices.

Purchasers were asked whether their purchasing patterns for OCTG had changed since 2006. 

Thirty-two of 46 purchasers reported that their purchasing patterns of OCTG have changed, and

14 reported that their patterns remained the same. Several purchasers that reported changes in purchasing

patterns added that their purchases followed the changes in demand, especially in 2008 when they

purchased up to three times more product than in the past.13 Some purchasers could not find enough

OCTG to satisfy their needs either due to availability, long lead times, or transportation problems, and

they “had to” purchase OCTG from nontraditional sources in order to have product available.14

Purchasers were asked to discuss the changes in the levels of their firms’ purchases of OCTG. 

Fifteen purchasers reported that they were unable to obtain the desired volume of OCTG during 2008 and

they alternated their sources of supply to foreign mills (six purchasers specified purchasing OCTG from

China, another purchaser mentioned China, Canada and Austria, and one purchaser mentioned purchasing

OCTG from Japan). Some purchasers provided additional comments: *** reported that, ***. ***

reported that during 2008, it “***.” *** reported that during 2008 “***. *** reported that ***. A few

purchasers reported that they were unable to anticipate the downturn in demand at the end of 2008,

although two purchasers reported that they purchase on a need basis and when demand dropped, so did

their purchases.

According to the petitioners, gas shale plays represent “a tremendous potential on servicing the

energy industry going forward.”15 Moreover, the respondents testified that “We expect to see growth in

 12 Distributor Premier Pipe testified at the conference that “in the spring of 2008, as the rig count was increasing,

we increased our purchases from both domestic and foreign suppliers in order to keep up with the stronger demand

from our customer base.” Conference transcript, p. 58 (Dewan).

 13 While many responses focused on demand trends, others introduced additional purchasing considerations. 

Distributor Cinco Pipe and Supply testified at the hearing that it was “undercut time after time by distributors and

speculators who were willing to sell low-priced Chinese products. Even in a period of strong demand like we had

last year, there will always be a significant number of end users whose purchase decisions are based primarily on

price.” Hearing transcript, p. 121 (Miller). See also testimony of Byron Dunn, Principal, Tubular Synergy Group

(“There are speculators . . . and it doesn't take a rocket scientist in a hot market to see the opportunities. . . but yes,

there were several significant, well capitalized, companies that were speculating. There were some big ones, and

then there were a bunch of little guys that were doing ones and twos.”) Hearing transcript, p. 319 (Dunn). 

 14 Six purchasers specifically reported that their inventories had increased because OCTG was not available from

U.S. and Korean sources.

 15 Hearing transcript, p. 138 (Cura).

II-8
demand in the future, primarily driven by the shale plays.”16 The petitioners argued that “the majority of

the Chinese inventory out there is material that is the right size to be used in the shale plays, which are

really the big focus of our domestic industry right now.”17 They also reported that “***.”18 Moreover,

“The *** analysis shows that the shale drilling applications consumed approximately *** percent of total

OCTG supply in 2008.19 Further, in 2009 and 2010, *** projects that the shale drilling applications will

*** their proportion of total OCTG consumption to *** percent, respectively. Respondents also provided

an estimate of 2009 OCTG consumption in the shale plays. Assuming active drilling by an average of

186 rigs in each of seven shale regions, respondents calculated that as much as 72 percent of current

OCTG consumption may be accounted for by the shale plays.20 ***.21

Demand outside the United States

Producers, importers, and purchasers were asked how has demand outside the United States

changed since January 1, 2006. Of the responding producers, one producer reported that demand has

increased, one reported that demand has decreased, and two reported fluctuating demand. Thirteen

importers reported that demand has increased, 9 reported that demand has decreased, 5 reported

fluctuating demand, and 1 importer reported no change in demand outside the United States. Similarly, of

the 23 responding purchasers, 11 reported fluctuating demand, 7 reported that demand has increased, and

5 reported that demand outside the United States remained the same. While most purchasers reported that

demand outside the United States is driven by similar factors as U.S. demand, one purchaser added that

development of less industrialized nations has driven much of the OCTG demand, and another purchaser

reported that the OCTG industry slowdown that began in the third quarter of 2008 has not been as

extensive outside the United States as it has within the United States.

Demand Characteristics

U.S. OCTG demand depends on the number of active rotary or workover rigs drilling for oil and

natural gas in the United States that use OCTG as well as the depth of these rigs.22 As the depth

increases, the amount of OCTG needed increases even more, as overall footage increases and larger outer

diameter casing is needed at the top of the well.23 Indeed, witness testimony suggested that OCTG

demand in the United States is “best measured by the footage of wells drilled.”24 Data for footage drilled

in the United States is presented in Figure II-3.

 16 Hearing transcript, p. 259 (Dunn).

 17 Hearing transcript, p. 200 (Shoaff).

 18 Maverick’s Posthearing brief, Exhibit 1, pp. 6-7.

 19 Ibid.

 20 Respondents’ Posthearing brief, exhibit 1, p. 3.

 21 Additional testimony regarding the shale plays appears in the hearing transcript, pp. 260, 328-330, 338-341,

and 364-366 (Dunn).

 22 Hearing transcript, pp. 187-188 (Surma).

 23 Oil Country Tubular Goods from Argentina, Austria, Italy, Japan, China, Mexico, and Spain, Investigations

Nos. 701-TA-363 and 364 (Final) and 731-TA-711-717 (Final), USITC Publication 2911, August 1995.

 24 Hearing transcript, p. 257 (Dunn). 

II-9
Figure II-3

U.S. drilling: Footage drilled, 2006-08, January-September 2008, and January-September 2009

Source: “Drilling and Production Outlook September 2009," Spears & Associates, Inc.

The number of active rotary or workover rigs is a broad indicator of demand for oil and natural

gas.25 Figures II-4 presents changes in monthly average crude oil prices, oil and total rig counts, and total

rig permits issued. Figure II-5 presents changes in monthly average natural gas prices, natural gas and

total rig counts, and total rig permits issued. 26 Figure II-6 presents actual and predicted prices for crude

oil and natural gas.

 25 Oil Country Tubular Goods from Argentina, Italy, Japan, Korea, and Mexico, Investigations Nos. 701-TA-711

and 713-716 (Second Review), USITC Publication 3923, June 2007.

 26 Petitioners argued that “One might claim that in terms of rig count, if you look now, the U.S. is not in such bad

shape. Rig count is 1,000; it's going up. By recent historic standards, it might be a bit low, but it's certainly not that

low.” Hearing transcript, p. 143 (Hausman). Respondents, in contrast, argued that “The two most recent declines in

the industry saw rig counts decline by about 500 rigs. The decline in 2009 saw rig counts plunge by more than 1,100

rigs in less than a year. This is a sharp decline, even by the standards of a highly cyclical industry.” Hearing

transcript, p. 274 (Durling). As of November 2009, the rig count averaged 1,107 rigs, when compared to 2,014 rigs,

the highest rig count recorded since January 2006 (Figure II-4).

II-10
Figure II-4

Crude oil prices, Baker-Hughes U.S. rig count, and U.S. rig permits, monthly averages, 

January 2006-September/October/November 2009

Source: Baker-Hughes Rig Count, Energy Information Administration, Preston, and RigData.

Figure II-5

Natural gas prices, Baker-Hughes U.S. rig count, and U.S. rig permits, monthly averages, 

January 2006-September/October/November 2009

Source: Baker-Hughes Rig Count, Energy Information Administration, Preston, and RigData.

II-11
Figure II-6

Oil and gas: Short term actual and predicted quarterly West Texas Intermediate crude oil prices

and composite wellhead spot prices of natural gas, January 2006-December 2010

Source: U.S. EIA, http://www.eia.doe.gov/emeu/steo/pub/xls/Fig1.xls and

http://www.eia.doe.gov/emeu/steo/pub/xls/Fig4.xls, retrieved December 11, 2009.

II-12
Business Cycle

Demand for OCTG tends to fluctuate from period to period and depends on the general business

cycle of the OCTG industry.27 The majority of the U.S. producers, importers, and purchasers that

reported that there is a specific cycle to the OCTG industry added that the business cycle is subject to oil

and gas prices and, therefore, it depends heavily on the oil and gas rig counts.28 As shown in figure II-7,

oil and gas drilling in the United States has experienced sharp upward and downward adjustments with

some frequency over the past two decades. 

Figure II-7

OCTG: Operating oil and gas rigs in the United States, January 1990-November 2009

Source: Baker-Hughes Rig Count, accessed December 11, 2009.

Substitute Products

One of 7 responding producers, 3 of 33 responding importers, and 3 of 40 responding purchasers

reported that there were substitute products for OCTG. Substitute products mentioned were API line

pipe, ASTM A500 rounds, coiled tubing, and expandable casing. Applications for API line pipe include: 

***, ***, or ***. Applications for ASTM A500 rounds include ***. The applications for expandable

casing are ***. Coiled tubing is used as a ***). One responding producer and two of 31 responding

importers indicated that changes in the prices of substitute products have affected the price for OCTG

based on responses to the preliminary and final phase questionnaires.

 27 Both the petitioners and the responded testified that OCTG industry is subject to a business cycle. Hearing

transcript, p. 162 (Hausman), p. 276 (Prusa).

 28 In the current down cycle, the active rigs count fell from 2100 to 900 and currently is back to 1,100. The

petitioners described this down cycle as being worse than the previous 1991-2001 down cycle. “The big difference

between the last down cycle and 2009 is we didn’t have three million tons of imports from China come in during the

last period.” Hearing transcript, pp. 100, 149-150.

II-13
Cost Share

Depending on the final end use, OCTG accounts for 8 to 20 percent of the total cost of the final

products in which it is used as an input according to five purchasers. One purchaser indicated that the

share of *** well costs accounted for by OCTG is 16 percent, the share of a drilled and completed ***

shale well costs accounted for by OCTG is 12 percent, and the share of a drilled and completed *** shale

well costs accounted for by OCTG is 15 percent. 

SUBSTITUTABILITY ISSUES

The degree of substitution between domestic and imported OCTG depends upon such factors as

relative prices, quality (e.g., grade standards, reliability of supply, defect rates, etc.), and conditions of 

sale (e.g., price discounts/rebates, lead times between order and delivery dates, payment terms, product

services, etc.). Based on available data, staff believes that there is a high degree of substitutability

between domestically-produced OCTG and Chinese-produced OCTG.

Factors Affecting Purchasing Decisions

Table II-3 summarizes the purchasers’ responses concerning the top three factors they reported

considering in their purchasing decisions. As indicated in the table, quality was cited most frequently as

the primary factor in buying decisions. Price was the most frequently cited second factor, and availability

was the most frequently cited third factor.

Table II-3

OCTG: Ranking factors used in purchasing decisions by U.S. purchasers

Factor

Number of firms reporting

Number one factor Number two factor Number three factor

Quality 21 11 5

Price1 11 18 12

Availability1 9915

Traditional supplier 2 1 0

Delivery 1 1 7

Contract 1 2 1

Reliability 1 0 1

Other2 24 6

 1 One firm reported both price and availability for the first factor; both responses are included in the table. 2 Other factors include meeting terms and demand for first factor, reputation, demand, responsibility, and service

for second factor; demand competitiveness, product consistency, warranty, product line and country for third factor.

Source: Compiled from data submitted in response to Commission questionnaires.

Nineteen of the 43 responding purchasers reported that domestically produced OCTG “always”

meets minimum quality specifications (table II-4). Twelve of the 46 responding purchasers reported that

the Chinese OCTG “always” meets minimum quality specifications. All purchasers reported that U.S.,

Korean, German, Canadian, and Japanese OCTG usually or always meets minimum quality

specifications, while a number of responding purchasers indicated that Chinese, Indian, and Russian

OCTG only sometimes meets minimum quality specifications.

II-14
Table II-4

OCTG: Ability to meet purchasers’ minimum quality specifications, by source

Country

Number of firms reporting1

Always Usually Sometimes Never

 United States 19 24 0 0

 China 12 22 12 0

 Korea 7 14 0 0

 Germany8 6 0 0

 Canada 6600

 Japan 5700

 India 1420

 Russia 1420

 1 Purchasers were asked how often domestically produced or imported OCTG meets minimum quality

specifications for their own or their customers’ uses. Countries with six or more purchasers responding are

reported. 

Source: Compiled from data submitted in response to Commission questionnaires.

Purchasers were also asked to rate the importance of 15 factors in their purchasing decisions 

(table II-5). Forty-six purchasers rated availability, quality meeting industry standards, and consistency

as very important; 44 firms reported price as very important; 43 firms rated delivery time and reliability

of supply as very important, and 30 firms reported delivery terms as very important. Other factors listed

as very important by more than half the responding purchasers include: delivery terms (30), quality

exceeds industry standards (26), technical support/services (25), and discounts offered (25).

II-15
Table II-5

OCTG: Importance of purchase factors, as reported by U.S. purchasers 

Factor

Very important Somewhat important Not important

Number of firms responding

Availability 46 2 0

Delivery terms 30 18 0

Delivery time 43 5 0

Discounts offered 25 20 3

Extension of credit 17 20 11

Minimum quantity requirements 7 28 13

Packaging 9 21 18

Price 44 4 0

Product consistency 46 2 0

Product range 15 30 3

Quality meets industry standards 46 2 0

Quality exceeds industry standards 26 19 3

Reliability of supply 43 4 1

Technical support/service 25 22 1

U.S. transportation costs 15 28 5

Note.--Not all purchasers responded for each factor.

Source: Compiled from data submitted in response to Commission questionnaires.

Purchasers were asked for a country-by-country comparison on the same 15 factors (table II-6). 

For U.S.-produced product compared to Chinese product, most purchasers reported that the U.S. product

was comparable with regard to delivery terms, discounts offered, extension of credit, minimum quantity

requirements, packaging, product range, quality meets or exceeds industry standards, and U.S.

transportation cost. Most purchasers reported China was superior on price, and inferior on delivery time,

reliability of supply, product consistency, and technical support.29

 29 For the factor “availability,” 11 purchasers reported that U.S. product was superior, 10 reported that U.S. and

Chinese products were comparable, and 11 reported that the U.S. product was inferior.

II-16
Table II-6

OCTG: Comparisons between U.S.-produced and imported OCTG as reported by U.S. purchasers

Factor

U.S. vs China

U.S. vs

nonsubject 

China vs

Nonsubject

SC I SC I SC I

Availability 11 10 11 8 25 18 4 13 4

Delivery terms 14 16 3 11 36 4 2 20 1

Delivery time 17 10 6 23 20 8 1 12 9

Discounts offered 6 19 6 9 41 2 4 16 1

Extension of credit 7 23 2 1 50 1 3 14 5

Price1 0 4 29 5 27 20 16 4 3

Minimum quantity requirements 7 21 5 6 41 4 0 18 4

Packaging 7 25 0 3 47 2 0 21 1

Product consistency 15 14 2 5 37 9 3 8 12

Product range 13 17 3 16 30 6 7 7 9

Quality meets industry standards 14 18 1 4 42 6 3 7 13

Quality exceeds industry standards 13 16 3 7 35 7 2 12 9

Reliability of supply 15 10 8 10 32 10 4 8 11

Technical support/service 22 8 3 15 30 7 1 9 13

U.S. transportation costs1 9 20 2 14 31 1 1 18 0

 1 A rating of superior means that price/U.S. transportation cost is generally lower. For example, if a firm reported

“U.S. superior”, it meant that the price of the U.S. product was generally lower than the price of the imported

product.

Note.--S=first listed country’s product is superior; C=both countries’ products are comparable; I=first listed country’s

product is inferior. One firm provided more than one answer for a number of comparisons. These responses are

not included in the table. Not all purchasers responded for all factors. 

Source: Compiled from data submitted in response to Commission questionnaires.

When comparing U.S.-produced product to nonsubject product, most purchasers reported that the

U.S. product was comparable in terms of all factors except delivery time. For delivery time,

23 purchasers reported U.S. product was superior, 20 reported that U.S. and nonsubject were comparable,

and 8 reported that U.S. was inferior. In addition, a large number of purchasers reported domestic OCTG

to be inferior to OCTG from nonsubject countries in terms of price and availability.30

When comparing Chinese product with nonsubject product, most purchasers reported that

Chinese and nonsubject product were comparable in terms of availability, delivery terms, delivery time,

discounts offered, extension of credit, minimum quantity requirements, packaging, quality exceeds

industry standards, and U.S. transportation costs. The majority of purchasers reported that the Chinese

product was inferior with regards to product consistency, quality meets industry standards, and technical

 30 A not insubstantial number of purchasers also rated U.S.-produced product as inferior in terms of supply

reliability. 

II-17
support/service.31 However, the majority of purchasers reported that Chinese prices were superior (i.e.

lower) than those for nonsubject product. Regarding product range, nine reported that Chinese product

was inferior, seven reported that Chinese and nonsubject product were comparable, and seven reported

that Chinese product was superior. 

When asked if certain grades/types/sizes of OCTG were available from only a single source,

30 of 47 responding purchasers reported “no.” However, of the 17 firms that reported “yes,” 8 firms

reported that Japanese firms produce chrome tubing, corrosion resistant, high alloy, and high strength

products; 3 firms noted that certain grades, and sizes are available from only a limited number of mills;

3 firms noted that U.S. producers have proprietary grades; and 1 firm reported manufacturers have

proprietary products. Some firms reported that only the domestic product is threaded with premium

threading.

Twenty-six of 47 responding purchasers reported they or their customers had preferences for

product from one country over other possible sources. Thirteen of these purchasers reported preferences

for U.S. product, 8 firms did not report preferences for product from any other countries, and the

remaining 7 firms reported preferences for multiple countries. Other country sources mentioned include: 

Japan (eight purchasers); Germany (six purchasers); Korea (three purchasers); Austria (three purchasers);

and Canada, North America, South America, Russia, Indonesia, Spain, and France were each mentioned

by one purchaser. Two firms reported a preference for product not from China and two reported a

preference for Chinese product.32

Purchasers were also asked if they make purchasing decisions based on the country of origin of

OCTG. Twenty-four purchasers indicated “always,” 11 indicated “usually,” 10 indicated “sometimes,”

and 1 reported “never.”

Thirty-six of 49 responding purchasers reported that they required their suppliers to become

certified or pre-qualified for all product, 4 firms reported that it was required but did not report the share

covered, and the remaining 8 firms did not require certification or pre-qualification. Thirty of

40 responding purchasers reported requiring API standards certification or pre-qualification and one firm

reported that 98 percent or more of its purchases are API certified. Other requirements mentioned include

review of documentation, quality control plan, plant inspection, chemistry, material specification, sample

evaluation, trial shipment, chemistry, and strength. One purchaser reported that the time required for

certification or pre-qualification was 2 to 6 months depending on products.

Eleven of 48 responding purchasers reported that some OCTG had failed certification; nine of

these firms specified that it was the Chinese product that had failed certification.

When qualifying a new supplier, most purchasers take into consideration API certification,

product quality, reputation of supplier, reliability of delivery, country of origin, third party inspections,

and price. Other factors taken into consideration include: availability factors (such as availability of sizes

required, product range, and meeting specifications); quality factors (such as ISO certification of source

steel, consistency, and low rejects; reputation factors such as reliability, customer acceptance, references

from purchasers, past performance, and claim resolution); services (including engineering support and

logistic support, factors related to the producer safety program, accurate documentation, country,

financial stability and continuity); terms; storage supply; repair; and warranties. Four purchasers reported

qualifications times that range from one week to one year. 

When purchasers were asked what characteristics they consider when determining the quality of

OCTG, 30 of 48 responding purchasers mentioned meeting API standards. In addition, four purchasers

mentioned meeting industry standards and seven purchasers reported that quality was determined at least

in part by third party inspections. Other factors noted by purchasers that determined quality included: 

past performance (such as failure rate, rejection rate, history of claims against the product, supplier

 31 In addition, a plurality noted that China was inferior to nonsubject countries with respect to reliability of

supply.

 32 Only three of the firms reporting preferences did not elaborate. 

II-18
reputation, and customer approval); factors related to the producing firm (such as pass mill audit, quality

team procedures, mill papers, and ability to handle claims; factors related to the product including clean

steel, raw material from quality mill, consistency, consistent chemistry, consistent heat treatment, ability

to perform above standard requirement); meeting specifications (such as meeting chemical and

mechanical specifications, and meeting grade thickness requirements); size tolerance; coupling and

threading provider; time in storage; handling damage; identifiable with legible stenciling together with

heat number; traceability; clean OD and ID with new protectors; supplier can change product to meet

needs; and product inspection.

Purchasers were asked to describe the lag time between order placement and delivery of OCTG

from different sources. When describing the lag time for domestically produced OCTG, 13 of 33

responding firms reported increased lag times in 2008. In addition two firms reported that U.S. product

became unavailable in 2008, and a number of other firms reported lead times increased with demand. Of

firms reporting time required, nine responding firms reported that, in periods of normal demand, lead

times were “as needed” to one month, while 10 purchasers reported that lead times rose to three months or

longer.

The reported lag time for OCTG imported from China was longer than for domestically-produced

OCTG, and 27 firms reported normal ranges of time that average over 3 months; during periods of high

demand, reported time lags of over 4 months were reported by 12 purchasers.

Twenty-five purchasers reported lag time for OCTG imported from nonsubject countries that

averaged over 3 months. Five purchasers reported that lead times from nonsubject countries increased

from an average of 1.4 months in periods of low demand to an average of 3.2 months in periods of high

demand.

Comparisons of Domestic Products and Subject Imports

In order to determine whether U.S.-produced OCTG can generally be used in the same

applications as imports from China, as well as imports from Canada, Germany, Japan, Korea, and other

countries, U.S. producers, importers, and purchasers were asked whether the products can “always,”

“frequently,” “sometimes,” or “never” be used interchangeably (table II-7). 

All 7 producers, 23 of 28 importers, and 26 of 41 purchasers reported that U.S.-produced OCTG

can “always” or “frequently” be used interchangeably with Chinese product. Of these firms, one

producer, two importers, and four purchasers stated that OCTG products that were manufactured to meet

API certifications were always interchangeable. Similarly, several importers and one purchaser reported

that certain grades are always interchangeable. However, some purchasers reported that certain grades

are not available in China or that end users refuse to use Chinese material. Moreover, one importer

reported that ***.33 Three importers and five purchasers reported that their customers reported quality

issues with OCTG produced in China.

 33 *** importers’ questionnaire.

II-19
Table II-7

OCTG: U.S. firms’ perceived degree of interchangeability of products produced in the United

States, China, and nonsubject countries1

Country pair

Number of U.S. 

producers reporting

Number of U.S.

importers reporting

Number of U.S.

purchasers reporting

AFSNAFSNAFSN

U.S. vs. China 7 0 0 0 12 11 5 0 14 12 15 0

U.S. vs. Canada 7 0 0 0 12 9 2 0 16 15 4 0

U.S. vs. Germany 7 0 0 0 13 10 2 0 21 12 5 0

U.S. vs. Japan 7 0 0 0 12 10 2 0 22 11 6 0

U.S. vs. Korea 7 0 0 0 10 8 6 0 14 13 10 0

U.S. vs. other countries2

6 1 0 0 10 8 5 0 12 5 11 0

China vs. Canada 7 0 0 0 10 10 2 0 14 9 9 0

China vs. Germany 7 0 0 0 10 8 5 0 15 7 11 1

China vs. Japan 7 0 0 0 9 8 5 0 15 7 12 1

China vs. Korea 7 0 0 0 11 8 4 0 13 9 11 0

China vs. other countries2

7 0 0 0 9 8 5 0 11 4 10 0

 1 Producers, importers, and purchasers were asked if OCTG produced in the United States and in other countries

is used interchangeably.

 2 These countries include: Canada, Germany, Japan, and Korea.

Note.--A = Always, F = Frequently, S = Sometimes, N = Never.

Source: Compiled from data submitted in response to Commission questionnaires.

Producers and importers were also asked to compare U.S.-produced products with imports from

China in terms of product differences other than price such as quality, availability, product range, and

technical support (table II-8). Six of the seven responding producers and 16 of the 25 responding

importers reported that differences other than price between OCTG produced in the United States and

China were “sometimes” or “never” a significant factor in their firm’s sales of the products; one producer

and four importers reported that these differences were “frequently” significant; and five importers

reported that the differences were “always” significant.

II-20
Table II-8

OCTG: Perceived significance of differences other than price between products produced in the

United States, China, and nonsubject countries1

Country pair

Number of U.S. producers

reporting

Number of U.S. importers

reporting

AFSNAFSN

U.S. vs. China 0 1 0 6 5 4 12 4

U.S. vs. Canada 00162376

U.S. vs. Germany 00252395

U.S. vs. Japan 00252475

U.S. vs. Korea 0 0 2 5 2 3 10 4

U.S. vs. other countries2 00251484

China vs. Canada 01152574

China vs. Germany 0 0 2 5 2 5 7 4

China vs. Japan 00252654

China vs. Korea 0 0 2 5 2 5 8 4

China vs. other countries2 00252574

 1 Producers and importers were asked if OCTG produced in the United States and in other countries had

significant differences other than price.

 2 These countries include: Canada, Germany, Japan, and Korea.

Note.--A = Always, F = Frequently, S = Sometimes, N = Never.

Source: Compiled from data submitted in response to Commission questionnaires.

Comparisons of Domestic Products and Nonsubject Imports

Responding producers nearly unanimously indicated that OCTG produced in the United States

and nonsubject countries were “always” used interchangeably (table II-7). The majority of responding

importers and responding purchasers indicated that OCTG produced in the United States and nonsubject

countries were “always” or “frequently” used interchangeably. Five of the seven responding producers

reported that differences other than price were “never” significant between U.S.-produced and nonsubject

OCTG (table II-8). The majority of responding importers reported that product differences other than

price between U.S.-produced and nonsubject OCTG were no more than “sometimes” significant.

II-21
Comparisons of Subject Imports and Nonsubject Imports

All seven responding producers indicated that OCTG produced in China and nonsubject countries

were “always” used interchangeably (table II-7), while the majority of responding importers and

purchasers indicated that OCTG produced in China and nonsubject countries were at least “frequently”

used interchangeably. Five of seven responding producers reported that there were “never” significant

differences other than price between Chinese-produced and nonsubject OCTG (table II-8). The majority

of responding importers reported that product differences other than price between Chinese-produced and

nonsubject OCTG were no more than “sometimes” significant.

ELASTICITY ESTIMATES

This section discusses elasticity estimates. Parties were encouraged to provide comments in their

prehearing briefs. No parties provided comments.34 

U.S. Supply Elasticity

The domestic supply elasticity for OCTG measures the sensitivity of the quantity supplied by the

U.S. producers to changes in the U.S. market price for OCTG. The elasticity of domestic supply depends

on several factors, including the level of excess capacity, the existence of inventories, and the availability

of alternate markets for U.S.-produced OCTG. Previous analysis of these factors indicates that the U.S.

industry has a moderate ability to increase or decrease shipments to the U.S. market based on unused

capacity and production flexibilities. An estimate in the range of 2 to 4 is suggested.

U.S. Demand Elasticity

The U.S. demand elasticity for OCTG measures the sensitivity of the overall quantity demanded

to a change in the U.S. market price of OCTG. This estimate depends on factors discussed earlier such as

the existence, availability, and commercial viability of substitute products, as well as the component share

of OCTG in the final cost of end-use products in which it is used. Because of a lack of close, broadly

accepted substitutes, it is likely that the aggregate demand for OCTG is moderately inelastic, with

suggested values ranging between -0.25 to -0.75. 

Substitution Elasticity

The elasticity of substitution depends upon the extent of product differentiation between domestic

and imported OCTG. Product differentiation, in turn, depends upon such factors as quality and condition

of sale (availability, delivery, etc.). Based on available information indicating that the domestic and

imported products can frequently be used interchangeably, the elasticity of substitution between U.S.-

produced OCTG and imported OCTG is likely to be in the range of 3 to 5. 

 34 However, as noted earlier, the petitioners contend that the likely available supply of OCTG from China will be

very high.

II-22
PART III: U.S. PRODUCERS’ PRODUCTION, SHIPMENTS, AND

EMPLOYMENT

The Commission analyzes a number of factors in making injury determinations (see 19 U.S.C. §§

1677(7)(B) and 1677(7)(C)). Information on the preliminary margin of dumping was presented earlier in

this report and information on the volume and pricing of imports of the subject merchandise is presented

in Parts IV and V. Information on the other factors specified is presented in this section and/or Part VI

and (except as noted) is based on the questionnaire responses of seven firms that accounted for the large

majority of U.S. production of OCTG during 2008.1

U.S. PRODUCERS

The Commission issued producer questionnaires to 50 U.S. firms that maintain API certification

to manufacture or process products in accordance with specification 5 CT and received completed

questionnaire responses from seven firms.2

 With the exception of the largest OCTG producer (U.S. Steel)

and the smallest (Wheatland), the responding producers are owned by non-U.S. parent companies. While

several firms with API certifications for manufacturing (Paragon Industries, Tex Tube) and processing

(Tejas Tubular, Texas Steel Conversion, Tubular Services, LP) casing, tubing, and/or coupling stock

provided *** data, the responding U.S. producers are believed to account for the large majority of U.S.

OCTG operations and more than *** percent of U.S. mill production. Table III-1 presents a list of

current domestic producers of OCTG and each company’s position on the petition, type and location of

production, related and/or affiliated firms, and share of reported OCTG production in 2008.3

 1 Staff requested U.S. producers to provide data for both seamless and welded operations. Responding firms with

seamless pipe operations are as follows: Evraz Rocky Mountain Steel; TMK IPSCO; United States Steel; V&M

Star; and V&M TCA. Responding firms with welded pipe operations are as follows: United States Steel; Maverick

Tube; TMK IPSCO; and Wheatland Tube.

 2

 Two firms, Boomerang Tube LLC and Northwest Pipe Company, began investing in OCTG production

facilities in 2008 with plans to produce in 2009-10. Nineteen firms responded that they did not produce OCTG,

12 formerly separate operations are now owned by one of the seven responding firms, and the remainder did not

respond.

 3

 V&M TCA processes unfinished OCTG ***. V&M TCA’s processing of U.S. origin OCTG represents a

double-count of production and shipments; however, because of the company’s ***, staff does not believe the

double-count to be meaningful.

III-1
Table III-1

OCTG: U.S. mills and processors, locations, types of production, shares of reported 2008

production, parent companies, and position on the petition

Firm

Production

locations

Type of

production

Share of

reported 2008

production

(percent)

Parent

company/related

foreign producer

Position on

the petition

Evraz Rocky

Mountain

Steel1

Pueblo, CO seamless ***

***% Evraz Inc. NA

and ***% Nippon

Steel Corp.

(Japan)

Support

Petitioner

Maverick3

Conroe, TX;

Blytheville, AR;

Hickman, AR;

Houston, TX

welded ***

***% Tenaris S.A

(Luxembourg) and

***% Siderca SAIC

(Argentina)

Support

Petitioner

TMK IPSCO

Enterprises2

Ambridge, PA;

Baytown, TX;

Blytheville, AR;

Camanche, IA;

Catoosa, OK;

Koppel, PA

Newport, KY;

Wilder, KY

seamless

welded *** ***% OAO TMK

(Russia)

Support

Petitioner

U.S. Steel4

Bellville, TX;

Fairfield, AL; Lone

Star, TX; Lorain,

OH; McKeesport,

PA

seamless

welded *** None Support

Petitioner

V&M Star5 Youngstown, OH;

Houston, TX seamless ***

***% V&M Tubes

(France)

***% Sumitomo

(Japan)

Support

Petitioner

V&M TCA6 Muskogee, OK seamless ***

***% V&M Tubes

(France)

***% Sumitomo

(Japan)

Support

Petitioner

Wheatland7

Little Rock, AR;

Sharon, PA;

Warren, OH;

Wheatland, PA

welded *** ***% DBO

Holdings

Support

Petitioner

Table continued on next page.

III-2
Table III-1--Continued

OCTG: U.S. mills and processors, types of production, locations, shares of reported 2008

production, parent companies, and position on the petition

 1 ***.

 2

 ***. TMK IPSCO is the North American division of Russia's OAO TMK, which claims to be the largest

pipe-maker in Russia and among the top three in the world.

 3

 ***.

 4

 ***.

 5

 ***.

 6

 ***.

 7

 ***.

Source: Compiled from data submitted in response to Commission questionnaires.

Each firm was asked if it experienced any plant openings, relocations, expansions, acquisitions,

consolidations, closures, or prolonged shutdowns because of strikes or equipment failure; curtailment of

production because of shortages of materials; or any other change in the character of their operations or

organization relating to the production of OCTG since January 1, 2006.4

 In their questionnaire responses,

U.S. producers focused on layoffs and shutdowns in 2009 which they generally attributed to U.S. imports

from China and the decline OCTG demand.5

 Table III-2 presents industry events during 2006-2009.

Table III-2

OCTG: Important industry events, 2006-09

Year Company

Description of event (merger, shutdown, bankruptcy, change in

production or capacity level) 

2006

IPSCO (Canada) Merger: IPSCO completes merger with NS Steel (Newport, KY) in

December 2006.

Lone Star (Houston) 

Joint ventures: Lone Star forms a joint venture with Grupo Peixoto de

Castro (Brazil) to produce finished welded oilfield tubular products in Brazil. 

Acquisition: Lone Star acquires a 50-percent ownership stake in Apolo

Mecanica e Estruturas LTDA, an oilfield tubular products facility in

southeastern Brazil for approximately $42 million.

Tenaris

(Luxembourg)

Merger: Tenaris, a producer of seamless OCTG, purchases Maverick in

October 2006 ($3.2 billion).

Boomerang Tube

(Chesterfield, MO)

New Investment: Company announces plans to raise more than $100

million to install a new OCTG mill in Liberty, TX. 

Table continued on next page.

 4 The Commission gave notice in the preliminary phase of these investigations that “(W)e will gather additional

information on the relationship between the consolidation of the domestic industry, its cost structure, and its ability

to respond to changes in demand. Certain Oil Country Tubular Goods from China, Investigation Nos. 701-TA-463

and 731-TA-1159 (Preliminary), USITC Publication 4081, June 2009, p.15 n.67. U.S. producers’ responses to this

question (Producers' questionnaire item II-2) are reflected in Part II and appendixes E and G.

 5

 For example, Evraz reported, “***.”

III-3
Table III-2--Continued

OCTG: Important industry events, 2006-09

Year Company

Description of event (merger, shutdown, bankruptcy, change in

production or capacity level) 

2007

Rocky Mountain

(Oregon Steel)

Acquisition: Evraz Group S.A.(Russia) purchases Oregon Steel Mills Inc.

(Then-owner of Rocky Mountain Steel Mill) for ($2.3 billion).

Tenaris Acquisition: Tenaris purchases Houston-based Hydril Co. ($2 billion).

U.S. Steel Acquisition: U.S. Steel purchases Lone Star ($2.1 billion).

IPSCO

Upgrade: IPSCO Inc. constructs a $*** OCTG heat treat facility adjacent

to its Blytheville, Arkansas pipe mill. Commercial production begins in the

third quarter.

Acquisition: SSAB (Sweden) purchases IPSCO for approximately

$7.7 billion.

2008

Evraz Group SA and

TMK (Russia)

Acquisition: Evraz Group SA and TMK (Russia) purchase SSAB’s IPSCO

tubular facilities in North America for $4 billion. TMK obtains all of IPSCO’s

U.S. tubular operations and 51 percent of NS Group for approximately

$1.2 billion.

Northwest Pipe Co.

Plant recommission: Northwest’s Bossier City, LA-facility is being

recommissioned to produce OCTG but has been delayed due to market

conditions. Products are expected to range from 2.375 to 7-inch outside

diameter.

Wheatland (John

Maneely/Carlyle) 

Acquisition canceled: Russian steel maker OJSC Novolipetsk Steel

cancels efforts to acquire tube and pipe producer John Maneely (parent

company of Wheatland Tube). John Maneely is a subsidiary of the Carlyle

Group (a Washington-based investment firm).

V&M Star

(Youngstown) 

Capacity increase: V&M Star (which acquired the North Star Steel

facilities in 2002) announced plans to invest $639 million into its

Youngstown facility to upgrade its OCTG operations. In addition, the state

of Ohio will use $20 million from the federal economic stimulus funding to

relocate the rail lines near the current property of V&M in Youngstown.

TMK IPSCO

(Houston)

Investment: TMK-IPSCO completes a new automated heat treatment

facility at Baytown Works (Baytown, TX) for OCTG sizes 2.375 inches to

7.625 inches. Capacity is 85,000 tons.

2009

U.S. Steel

Plant idling: The large OD seamless pipe mill restarted in March after

several weeks of idling. The Lone Star facility (capacity of *** tons of

OCTG, line pipe, and structural pipe) was temporarily idled in February,

leading to the layoff of 892 union workers and 400 salaried employees

(AMM, Feb. 16). At the end of the first quarter, other OCTG facilities in

Bellville (TX), and Lorain (OH) and related flat-rolled operations in Granite

City (IL) were idled. The seamless facility in Fairfield (AL) was scaled down

to one week per month.1

 

Tianjin Pipe Group

Corp. (China)

New investment: Wuxi (an affiliate of WSP Holdings Limited, China) plans

to build a $35-million facility in Houston. WSP is China's third largest

OCTG producer. The finishing line will begin operations by the end of 2009

but the heat-treating facility is delayed because of unfavorable market

conditions.

Table continued on next page.

III-4
Table III-2--Continued

OCTG: Important industry events, 2006-09

Year Company

Description of event (merger, shutdown, bankruptcy, change in

production or capacity level) 

2009

Wuxi Seamless Oil

Pipe Co.

New investment: Wuxi (an affiliate of WSP Holdings Limited, China) plans

to build a 120,000-ton, $35-million facility in Houston. WSP is China's third

largest OCTG producer. The finishing line will begin operations by the end

of 2009 but the heat-treating (quenching and tempering) facility is delayed

because of unfavorable market conditions.

V&M Star

(Youngstown) 

Capacity increase: V&M Star (a unit of Houston-based Vallourec &

Mannesmann Tubes Corp. which acquired the North Star Steel facilities in

2002) is considering a $600-million to $1-billion expansion of its mini-mill to

increase the amount and type of tubular products it manufactures. The

company hopes to upgrade and expand its melt shop and billet casting

operations to lift production rates and increase annual output by about

70 percent to 1.4 million tons of liquid steel from 830,000 tons. V&M Star

employs about 465 workers and the expansion would result in the creation

of at least 300 additional jobs. The state of Ohio will use $20 million from

the federal economic stimulus funding to relocate the rail lines near the

current property of V&M in Youngstown. The City of Youngstown has

purchased land for the expansion and V&M will reimburse the City. City

officials have traveled to Europe to meet with V&M officials to discuss

details of the expansion. 

V&M and Sumitomo

Metal Industries

(SMI) 

Joint venture: V&M and SMI agreed to (1) purchase $120 million worth of

shares in each other from the stock market and other sources by the end of

this year; and (2) merge their U.S. joint venture with a Vallourec unit in the

United States to strengthen their relationship in the oil country tubular

OCTG) goods segment. The V&M and SMI joint venture is expected to

become the largest seamless producer in the United States.

Northwest Pipe

Company (NW)

(Bossier City, LA)

Plant recommission: Northwest’s Bossier City, LA-facility is being

recommissioned to produce OCTG with the relocation of equipment from a

mill in Portland, OR. Products are expected to range from 2.375 to 7-inch

outside diameters (O.D.). Production is now expected in 2010 and the

facility will include end processing and inspection.

Boomerang Tube

(Chesterfield, MO)

Investment revision: ***

 1 Hearing transcript, p. 84 (Mr. Surma).

Sources: American Metal Market, several issues; Metal Bulletin Research, Seamless Steel Tube and Pipe Monthly,

several issues; Metal Bulletin Research, Welded Steel Tube and Pipe Monthly, several issues; Preston Publishing

Company, several issues; SBB Daily Briefing, Global Edition - May 4, 2007: “SSAB to Purchase IPSCO for $7.7bn

Cash;" Press Releases from Strasburger & Price, LLP: “Lone Star Technologies, Inc. Completes Purchase of

Bellville Tube Corporation’s Assets,” and “Strasburger Represents Lone Star Technologies in Two Strategic

Announcements;” companies’ financial reports; and staff telephone interviews.

III-5
U.S. CAPACITY, PRODUCTION, AND CAPACITY UTILIZATION6

U.S. producers’ capacity, production, and capacity utilization data for OCTG are presented in

table III-3.7

 The overall growth in production between 2006 and 2008 reflected increased production of

seamless, rather than welded, OCTG, most notably by ***.8

Table III-3

OCTG: U.S. capacity, production, and capacity utilization, 2006-08, January-September 2008, and

January-September 2009

Item

Calendar year January-September--

2006 2007 2008 2008 2009

Capacity (short tons) 4,294,830 4,238,435 4,469,087 3,354,491 3,439,040

Production (short tons) 2,943,048 2,508,029 3,081,518 2,267,478 606,651

Capacity utilization (percent) 68.5 59.2 69.0 67.6 17.6

Source: Compiled from data submitted in response to Commission questionnaires.

Producers were asked to describe the constraint(s) that set the limit(s) on their production

capacity and ability to shift production capacity between products (producers’s questionnaire II-4).9

Evraz reported “***.” IPSCO reported that “***.” Maverick reported its main constraint on production

and capacity was ***. U.S. Steel reported “***.” V&M Star reported its capacity is “***.” V&M TCA

reported that “***.” Wheatland reported “***.”

U.S. OCTG producers were asked for their capacity, production, and capacity utilization data, by

welded and seamless tubular products, for all of their U.S. tubular producing establishments as presented

in table III-4. Responding firms reported that 55 percent of their total tubular capacity was welded and

45 percent seamless during 2006-08. In 2008, 70 percent of the welded and seamless tubular production

reported was oil/gas well casing and tubing, and/or coupling stock and 25 percent was

standard/line/pressure pipe (the remainder was drill pipe, mechanical tubing, and other tubing).

 6 Changes in capacity and production figures between the preliminary and final phases of these investigations are

due to the inclusion of coupling stock that was not reported on *** questionnaire responses in the preliminary phase.

 7

 While U.S. mills reported available rolling capacity throughout the period for which data were collected, the

availability of heat treatment posed an additional constraint for products such as seamless alloy steel OCTG that

require additional processing. According to their questionnaires and supplemental responses, Evraz Rocky

Mountain Steel ***. *** had available capacity in 2009, as did ***, which also reported that its heat-treat capacity

exceeded its seamless OCTG production by *** short tons in 2008. See submission of May 15, 2009, on behalf of

***.

 8

 U.S. producers reported lower production levels in January-September 2009 than in January-September 2008,

reflecting the idling of several facilities (including the indefinite idling of two welded pipe facilities by U.S. Steel). 

U.S. producers did not, however, reduce their reported capacity levels during this period.

 9

 In addition to being asked to describe the constraint(s) that set the limit(s) on production capacity, U.S.

producers were also requested to indicate the challenges faced by each firm in meeting rising demand for OCTG,

and explain the nature of any excess capacity reported during periods of rising demand. Initially Maverick (a

producer that reported ***) provided a detailed response to the Commission’s questions (indicating that it had ***). 

Additional follow-up responses appear in appendix E.

III-6
U.S. PRODUCERS’ SHIPMENTS

Data on U.S. producers’ shipments of OCTG are presented in table III-5. U.S. shipments

increased by 6.5 percent, by quantity, between 2006 and 2008, largely reflecting greater shipment

volumes of seamless OCTG. U.S. shipments were 69.6 percent lower in the first three quarters of 2009 as

compared with the first three quarters of 2008, reflecting diminished shipments of seamless and, to an

even greater extent, welded OCTG. Average unit values did not shift markedly between 2006 and 2007,

but increased noticeably in 2008, and were substantially higher in the January-September 2009 than in the

January-September 2008.10 While Maverick, TMK IPSCO, U.S. Steel, and V&M Star all reported

exports, export shipments never exceeded *** percent of total shipments.

 10 The higher average unit values in January-September 2009 reflect increases in both seamless and welded

OCTG average unit values over the comparable period in 2008, as well as a greater portion of sales of seamless

OCTG (with higher average unit values than welded OCTG).

III-7
Table III-4

OCTG: U.S. capacity, production, and capacity utilization of welded and seamless tubular

products, 2006-08, January-September 2008, and January-September 2009

Item

Calendar year January-September--

2006 2007 2008 2008 2009

Capacity (short tons)

Welded tubular products 3,245,326 3,167,112 3,186,054 2,389,291 2,364,131

Seamless tubular products 2,604,250 2,610,250 2,634,750 1,976,060 2,059,310

Total 5,849,576 5,777,362 5,820,804 4,365,351 4,423,441

Production (short tons)

Welded

Oil/gas well casing *** *** *** *** ***

Oil/gas well tubing *** *** *** *** ***

Standard, line and pressure pipe 645,454 737,185 718,230 618,690 334,375

Pressure tubing *** *** *** *** ***

Mechanical tubing *** *** *** *** ***

Other tubing *** *** *** *** ***

Total welded 2,272,556 2,092,469 2,339,253 1,845,973 522,713

Seamless

Oil/gas well casing *** *** *** *** ***

Oil/gas well tubing *** *** *** *** ***

OCTG coupling stock *** *** *** *** ***

Drill pipe *** *** *** *** ***

Standard, line and pressure pipe 457,700 322,353 365,327 278,654 71,108

Pressure tubing *** *** *** *** ***

Mechanical tubing *** *** *** *** ***

Other tubing *** *** *** *** ***

Total seamless 1,960,347 1,668,294 2,025,552 1,495,535 511,489

Total welded & seamless 4,232,903 3,760,763 4,364,805 3,341,508 1,034,202

Capacity utilization (percent)

Welded tubular products 70.0 66.1 73.4 77.3 22.1

Seamless tubular products 75.3 63.9 76.9 75.7 24.8

Average 72.4 65.1 75.0 76.5 23.4

Source: Compiled from data submitted in response to Commission questionnaires.

III-8
Table III-5

OCTG: U.S. producers’ shipments, by types, 2006-08, January-September 2008, and JanuarySeptember 2009

Item

Calendar year January-September--

2006 2007 2008 2008 2009

Quantity (short tons)

Commercial shipments *** *** *** *** ***

Internal consumption *** *** *** *** ***

Transfers to related firms *** *** *** *** ***

U.S. shipments 2,805,457 2,381,634 2,986,480 2,225,983 677,514

Export shipments *** *** *** *** ***

Total shipments *** *** *** *** ***

Value (1,000 dollars)

Commercial shipments *** *** *** *** ***

Internal consumption *** *** *** *** ***

Transfers to related firms *** *** *** *** ***

U.S. shipments 4,166,873 3,304,828 6,184,818 4,079,523 1,383,423

Export shipments *** *** *** *** ***

Total shipments *** *** *** *** ***

Unit value (per short ton)

Commercial shipments $*** $*** $*** $*** $***

Internal consumption *** *** *** *** ***

Transfers to related firms *** *** *** *** ***

U.S. shipments 1,485 1,388 2,071 1,833 2,042

Export shipments *** *** *** *** ***

Total shipments *** *** *** *** ***

Share of quantity (percent)

Commercial shipments *** *** *** *** ***

Internal consumption *** *** *** *** ***

Transfers to related firms *** *** *** *** ***

U.S. shipments *** *** *** *** ***

Export shipments *** *** *** *** ***

Total shipments 100.0 100.0 100.0 100.0 100.0

 1 Not applicable.

Note.–Because of rounding, figures may not add to the totals shown.

Source: Compiled from data submitted in response to Commission questionnaires.

III-9
ORDER BOOKS

Tables III-6 and III-7 present reported quantity of OCTG, seamless and welded, entered in the

reporting firms’ “order books” at the close of specified quarters and months. Order books for welded

OCTG peaked in March 2008, while seamless OCTG order books did not peak until October 2008. 

Reported lead times ranged from 7 to 90 days with the shortest times registered by all producers on

September 30, 2009. The longest periods were the June 30 periods of 2006 and 2008.

Table III-6

OCTG: OCTG entered into order books, March 31, 2006 - September 30, 2009

Period Seamless Welded Total

Quantity (short tons)

2006

March 31 *** *** 460,261

June 30 *** *** 434,155

September 30 *** *** 389,895

December 31 *** *** 326,498

2007

March 31 *** *** 323,936

June 30 *** *** 323,155

September 30 *** *** 436,292

December 31 *** *** 424,101

2008

March 31 *** *** 668,578

June 30 *** *** 655,155

September 30 *** *** 612,095

December 31 *** *** 275,697

2009

March 31 *** *** 58,504

June 30 *** *** 67,009

September 30 *** *** 136,657

Source: Compiled from data submitted in response to Commission questionnaires.

III-10
Table III-7

OCTG: OCTG entered into order books, monthly, January 2008 - September 2009

Period Seamless Welded Total

Quantity (short tons)

2008

January *** *** 511,300

February *** *** 538,218

March *** *** 668,578

April *** *** 618,536

May *** *** 635,634

June *** *** 655,155

July *** *** 653,631

August *** *** 670,248

September *** *** 612,095

October *** *** 557,822

November *** *** 424,665

December *** *** 275,697

2009

January *** *** 170,426

February *** *** 106,616

March *** *** 58,504

April *** *** 48,234

May *** *** 47,798

June *** *** 67,009

July *** *** 97,673

August *** *** 120,176

September *** *** 136,657

Source: Compiled from data submitted in response to Commission questionnaires.

III-11
U.S. PRODUCERS’ INVENTORIES

Table III-8, which presents end-of-period inventories for OCTG, indicates that producers’

inventories peaked in absolute terms in 2007. However, by September 2009, producers’ inventories were

equivalent to approximately one-third of the diminished annualized production and U.S. shipment levels,

reflecting in particular higher levels of welded OCTG inventories relative to production and shipments.

Table III-8

OCTG: U.S. producers’ end-of-period inventories, 2006-08, January-September 2008, and

January-September 2009

Item

Calendar year January-September--

2006 2007 2008 2008 2009

Inventories (short tons) 374,234 430,873 389,263 380,471 288,337

Ratio to production (percent) 12.7 17.2 12.6 12.6 35.6

Ratio to U.S. shipments (percent) 13.3 18.1 13.0 12.8 31.9

Ratio to total shipments (percent) *** *** *** *** ***

Note.–Partial-year ratios are based on annualized production and shipments.

Source: Compiled from data submitted in response to Commission questionnaires.

U.S. PRODUCERS’ IMPORTS AND PURCHASES

U.S. producers’ imports and purchases of OCTG are presented in table III-9.

Table III-9

OCTG: U.S. producers’ imports and purchases, 2006-08, January-September 2008, and JanuarySeptember 2009

* * * * * * *

Table III-9

OCTG: U.S. producers’ imports and purchases, 2006-08, January-September 2008, and JanuarySeptember 2009

* * * * * * *

III-12
U.S. EMPLOYMENT, WAGES, AND PRODUCTIVITY

The U.S. producers’ aggregate employment data for OCTG are presented in table III-10. At the

Commission’s hearing Mr. John Surma, Chairman and Chief Executive Officer of the United States Steel

Corporation and Mr. Leo Gerard, President of the United Steel Workers, testified that between the end of

2008 and continuing into 2009 several OCTG facilities were idled laying off approximately 2,500 OCTG

workers and many others had their working hours and wages reduced.11

Table III-10

OCTG: Average number of production and related workers, hours worked, wages paid to such

employees, and hourly wages, productivity, and unit labor costs, 2006-08, January-September

2008, and January-September 2009

Item

Calendar year January-September--

2006 2007 2008 2008 2009

Production and related workers 5,448 5,396 5,819 5,497 3,398

Hours worked (1,000) 11,953 11,484 12,871 9,119 4,528

Wages paid ($1,000) 297,955 279,780 339,737 254,689 146,284

Hourly wages $24.93 $24.36 $26.40 $27.93 $32.31

Productivity (short tons per 1,000 hours) 246.2 218.4 239.4 248.7 134.0

Unit labor costs (per short ton) $101.24 $111.55 $110.25 $112.32 $241.13

Source: Compiled from data submitted in response to Commission questionnaires.

 11 Hearing transcript, pp. 84 (Surma) and 89 (Gerard). Mr. Gerard stated that workers in this industry were laid

off at many facilities including Lone Star, Bellville, and Conroe (Texas); Fairfield (Alabama); Lorain, Youngstown,

and Warren (Ohio); Wheatland, Koppel, and Ambridge (Pennsylvania); Wilder (Kentucky); Camanche (Iowa);

Blytheville and Hickman (Arkansas); and Pueblo (Colorado). 

III-13
 
PART IV: U.S. IMPORTS, APPARENT CONSUMPTION, AND

MARKET SHARES

U.S. IMPORTERS

Importer questionnaires were sent to 156 firms believed to be importers of subject OCTG, as well

as to all U.S. producers of OCTG.1

 Usable questionnaire responses were received from 47 companies,2

representing 77.9 percent of total imports from China and 59.8 percent of all other imports in 2008, under

HTS subheadings 7304.29, 7305.20, 7306.20, and 7306.29.3

 Table IV-1 lists all responding U.S.

importers of OCTG from China and other sources, their U.S. headquarters, and their shares of U.S.

imports, in 2008.

Table IV-1

OCTG: U.S. importers, source(s) of imports, U.S. headquarters, and shares of imports in 2008

Firm Headquarters Source(s) of imports

Share of imports (percent)

China Other Total

America Piping Products Chesterfield, MO *** *** *** ***

Atlas Tubular Robstown, TX *** *** *** ***

Aztec1 Crowley, TX *** *** *** ***

Bell Supply Co LLP Gainesville, TX *** *** *** ***

Benteler Steel & Tube2 Houston, TX *** *** *** ***

Champions Pipe & Supply3 Houston, TX *** *** *** ***

Coutinho & Ferrostaal4 Houston, TX *** *** *** ***

Commercial Metals5 Irving, TX *** *** *** ***

Conestoga Supply1 Houston, TX *** *** *** ***

Corus International Trading6 Schaumburg, IL *** *** *** ***

Cressman Tubular Products1 Addison, TX *** *** *** ***

The Crispin Co. Houston, TX *** *** *** ***

DSL Corp. Houston, TX *** *** *** ***

Energy Tubulars1 Seal Beach, CA *** *** *** ***

Fortis Alliance Houston, TX *** *** *** ***

Table continued on next page.

 1 The Commission sent questionnaires to those firms identified in the petition, along with firms that, based on a

review of data provided by U.S. Customs and Border Protection (“Customs”), were believed to import OCTG.

 2

 Two firms provided questionnaire responses that did not have useable trade data: ***. Ten firms responded in

the preliminary phase of these investigations but did not in the final phase. The responses of these companies, which

accounted for *** percent of 2008 imports from China, are used for full-year (2006-08) data.

 3

 The relevant statistical reporting numbers appear in Part I of this report.

IV-1
Table IV-1--Continued

OCTG: U.S. importers, source(s) of imports, U.S. headquarters, and shares of imports in 2008

Firm Headquarters Source(s) of imports

Share of imports (percent)

China Other Total

Gulf Coast Tubulars1 Austin, TX *** *** *** ***

Houston OCTG Group7 Houston, TX *** *** *** ***

Husteel USA, Inc. Anaheim, CA *** *** *** ***

Hyosung America, Inc. Brea, CA *** *** *** ***

Jilus/Tubular Synergy Group8

Fort Lee, NJ;

Addison, TX *** *** *** ***

Kanematsu USA, Inc. New York, NY *** *** *** ***

KPC Imports1

; 9

Santa Fe Springs,

CA *** *** *** ***

MacSteel International10 White Plains, NY *** *** *** ***

Marubeni-Itochu11 Houston, TX *** *** *** ***

MC Tubular12 Houston, TX *** *** *** ***

Nexgen Metals13 Torrance, CA *** *** *** ***

Okaya (USA), Inc.14 Houston, TX *** *** *** ***

Oxbow Steel International1 Pleasant Hill, CA *** *** *** ***

PacRim Pipes1 Issaquah, WA *** *** *** ***

PanMeridian Tubular15 Houston, TX *** *** *** ***

S B International16 Dallas, TX *** *** *** ***

Seba Pipe, Ltd. Houston, TX *** *** *** ***

Shengli Highland17 Houston, TX *** *** *** ***

SNT Services, Inc. Houston, TX *** *** *** ***

Standard Tube Co.1 Houston, TX *** *** *** ***

Sumitomo Corp. Houston, TX *** *** *** ***

Tenaris Global/Maverick18 Houston, TX *** *** *** ***

TMK IPSCO19 Downers Grove, IL *** *** *** ***

Toyota Tsusho Houston, TX *** *** *** ***

TPCO Enterprise, Inc.20 Houston, TX *** *** *** ***

United Casing1 Houston, TX *** *** *** ***

U.S. Steel21 Pittsburgh, PA *** *** *** ***

Table continued on next page.

IV-2
Table IV-1--Continued

OCTG: U.S. importers, source(s) of imports, U.S. headquarters, and shares of imports in 2008

Firm Headquarters Source(s) of imports

Share of imports (percent)

China Other Total

Victor Development22 Houston, TX *** *** *** ***

Voest-Alpine Tubular23 Houston, TX *** *** *** ***

V&M Star, LP & V&M TCA24 Houston, TX *** *** *** ***

Total - Commerce 77.9 59.8 70.5

 1 Supplied data in the preliminary phase of these investigations but did not respond in the final phase.

 2

 ***.

 3

 ***.

 4

 ***.

 5

 ***.

 6

 ***.

 7

 ***.

 8

 “***.”

 9

 ***.

 10 ***.

 11 ***.

 12 ***.

 13 ***.

 14 ***.

 15 ***.

 16 ***.

 17 ***.

 18 ***.

 19 ***.

 20 ***.

 21 ***.

 22 ***.

 23 ***.

 24 ***.

Note.–Because of rounding, figures may not add to the totals shown. U.S. imports from China, nonsubject countries, and total

imports each do not add up to 100 percent because questionnaire coverage of U.S. imports from subject and nonsubject countries

is incomplete.

Source: Compiled from data submitted in response to Commission questionnaires.

U.S. IMPORTS

Table IV-2 presents official Commerce data for U.S. imports of OCTG from China and all other

sources.4

 The quantity of U.S. imports of seamless and welded OCTG from China tripled between 2006

to 2008 while most of the increase from nonsubject countries consisted of seamless OCTG. U.S. imports

of OCTG from China and from nonsubject sources were lower in January-September 2009 than in

January-September 2008, although this primarily reflects import levels after May 2009 (China) or after

March 2009 (nonsubject sources).

The value of U.S. imports of seamless and welded OCTG followed the same trend during 2006-

08 as average unit values increased. Higher average unit values in January-September 2009 offset, in

whole or in part, the decline in U.S. import quantities, resulting in less pronounced movements in the

 4 HTS subheadings 7304.29, 7305.20, 7306.20, and 7306.29.

IV-3
value of U.S. imports. The average unit values of U.S. imports from China were lower than those of U.S.

imports from nonsubject countries for both seamless and welded OCTG, as well as in the aggregate.

Table IV-3 presents U.S. imports from major sources and table IV-4 presents monthly imports of

OCTG. Houston, TX, was the port of entry for 85.7 percent of 2008 OCTG imports from China while

Los Angles, CA, accounted for 10.6 percent; nonsubject imports also entered the United States primarily

through Texas and California ports.

Table IV-2

OCTG: U.S. imports, by sources, 2006-08, January-September 2008, and January-September 2009

Source

Calendar year January-September

2006 2007 2008 2008 2009

Quantity (short tons)

China 725,027 860,711 2,197,556 1,232,826 739,659

Nonsubject 1,204,575 864,612 1,534,713 1,006,389 583,130

Total 1,929,601 1,725,323 3,732,269 2,239,214 1,322,789

Value (1,000 dollars)

1

China 681,292 811,542 2,805,206 1,377,072 1,105,138

Nonsubject 1,598,489 1,089,955 2,572,888 1,461,709 1,192,040

Total 2,279,781 1,901,497 5,378,094 2,838,781 2,297,177

Unit value (per short ton)

1

China $940 $943 $1,277 $1,117 $1,494

Nonsubject 1,327 1,261 1,676 1,452 2,044

Average 1,181 1,102 1,441 1,268 1,737

Share of quantity (percent)

China 37.6 49.9 58.9 55.1 55.9

Nonsubject 62.4 50.1 41.1 44.9 44.1

Total 100.0 100.0 100.0 100.0 100.0

Share of value (percent)

China 29.9 42.7 52.2 48.5 48.1

Nonsubject 70.1 57.3 47.8 51.5 51.9

Total 100.0 100.0 100.0 100.0 100.0

1

 Landed, U.S. port of entry, duty-paid.

Note.--Coupling stock enters the United States in low volumes under HTS subheadings covering an assortment of tubular

products, and so is not included in import data compiled from official Commerce statistics. Reported Chinese imports of coupling

stock ***.

Source: Compiled from official Commerce statistics for HTS subheadings 7304.29, 7305.20, 7306.20, and 7306.29.

IV-4
Table IV-3

OCTG: U.S. imports, by sources, 2006-08, January-September 2008, and January-September 2009

Country

Calendar year January - September

2006 2007 2008 2008 2009

Quantity (short tons)

China1 725,027 860,711 2,197,556 1,232,826 739,659

Korea2 201,142 210,421 360,430 276,759 116,786

Canada3 146,355 153,193 225,889 173,707 45,990

Germany1 122,275 81,535 139,030 89,871 60,271

Japan1 72,020 26,433 103,338 43,156 72,669

Austria1 84,093 62,642 93,700 70,099 43,083

Colombia2 70,451 77,882 93,503 71,922 10,835

India1 34,132 23,785 90,887 50,579 16,907

Argentina1 2,025 5,119 70,324 23,596 22,314

Russia3 97,478 28,713 62,770 28,288 46,783

Mexico1 428 7,903 60,890 38,956 33,092

All other3 374,174 186,985 233,954 139,455 114,400

Total 1,929,602 1,725,323 3,732,269 2,239,215 1,322,789

Value ($1,000)

China1 681,292 811,542 2,805,206 1,377,072 1,105,138

Korea2 168,958 177,902 412,497 283,516 132,650

Canada3 201,173 206,401 395,162 270,541 97,946

Germany1 179,014 125,565 261,117 152,550 143,297

Japan1 301,352 104,617 207,690 87,366 185,222

Austria1 142,940 101,381 184,903 124,944 99,533

Colombia2 91,451 99,667 176,515 124,692 17,621

India1 44,389 28,100 154,293 68,988 30,794

Argentina1 1,740 9,346 159,821 40,662 59,197

Russia3 90,978 25,974 93,792 28,922 82,662

Mexico1 173 11,838 132,572 70,990 98,943

All other3 376,320 199,165 394,526 208,537 244,174

Total 2,279,781 1,901,497 5,378,094 2,838,781 2,297,178

Table continued on next page.

IV-5
Table IV-3--Continued

OCTG: U.S. imports, by sources, 2006-08, January-September 2008, and January-September

2009

Country

Calendar year January - September

2006 2007 2008 2008 2009

Unit value (dollars per short ton)

China1 $940 $943 $1,277 $1,117 $1,494

Korea2 840 845 1,144 1,024 1,136

Canada3 1,375 1,347 1,749 1,557 2,130

Germany1 1,464 1,540 1,878 1,697 2,378

Japan1 4,184 3,958 2,010 2,024 2,549

Austria1 1,700 1,618 1,973 1,782 2,310

Colombia2 1,298 1,280 1,888 1,734 1,626

India1 1,300 1,181 1,698 1,364 1,821

Argentina1 859 1,826 2,273 1,723 2,653

Russia3 933 905 1,494 1,022 1,767

Mexico1 405 1,498 2,177 1,822 2,990

All other3 1,006 1,065 1,686 1,495 2,134

Average 1,181 1,102 1,441 1,268 1,737

 1 Primarily seamless OCTG.

 2

 Primarily welded OCTG.

 3

 Both seamless and welded OCTG.

Source: Compiled from official Commerce statistics.

IV-6
IV-7

Table IV-4OCTG: U.S. imports, by source and month, 2006-08 and January-September 2009

Source January February March April May June July August September October N

Quantity (short tons)

2006 China 31,149 33,281 60,883 60,289 52,306 57,638 84,732 60,090 57,843 77,447  Nonsubject 129,914 95,961 86,669 120,509 129,587 88,315 119,755 113,183 75,322 87,460  Total 161,063 129,241 147,552 180,798 181,893 145,953 204,486 173,274 133,166 164,907 2007 China 80,300 74,069 59,477 52,931 104,535 83,209 75,807 58,467 74,489 61,237  Nonsubject 85,640 75,947 85,336 72,958 73,599 68,097 76,903 64,312 74,894 55,023  Total 165,940 150,016 144,813 125,889 178,133 151,306 152,710 122,779 149,383 116,261 2008 China 90,410 91,282 98,968 74,292 96,398 150,731 144,184 186,005 300,556 324,615  Nonsubject 106,675 45,909 104,123 101,191 123,554 93,611 153,617 120,295 157,414 181,626  Total 197,085 137,191 203,090 175,483 219,951 244,342 297,801 306,300 457,970 506,240 2009 China 273,094 182,496 121,691 54,327 100,674 7,205 19 123 29  Nonsubject 195,211 76,860 115,919 51,128 40,483 27,023 35,357 13,108 28,041  Total 468,305 259,357 237,610 105,454 141,157 34,228 35,376 13,231 28,070 Source: Compiled from official Commerce statistics (HTS 7304.29, 7305.20, 7306.20, 7306.29).
CRITICAL CIRCUMSTANCES

The petition alleges that “critical circumstances” exist with regard to imports from China of

OCTG.5 6

 Certain subject imports may be subject to antidumping duties retroactive by 90 days from the

effective date of Commerce’s preliminary subsidy or LTFV determination, if affirmative. Commerce has

issued a final negative critical circumstances determination in conjunction with its countervailing duty

determination, finding that there had been no “massive increase” in shipments.7

 On November 17, 2009,

Commerce issued a preliminary determination that “critical circumstances” do not exist for Changbao,

TPCO or the separate-rate respondents but do exist with regard to LTFV imports from China of OCTG

from the PRC entity.8

 Table IV-5 presents U.S. imports by the PRC entity for the six-month period prior

to the filing of the petition on April 8, 2009 and the six-month period following the filing of the petition.9

Table IV-5

OCTG: U.S. imports from China subject to Comerce’s preliminary critical circumstances

determination, by month, October 2008 - September 2009

Quantity (short tons)

October November December January February March Total

*** *** *** *** *** *** ***

April1 May June July August September Total

*** *** *** *** *** *** ***

 1 The petition in this investigation was filed on April 8, 2009.

Note.--Percentage change between the aggregate six month imports is -86.9 percent.

Source: Compiled from data provided by Customs.

 5 Petitioners allege that critical circumstances exist with regard to Chinese OCTG. Petitioners allege that there

was a massive surge in imports of Chinese OCTG in the second half of 2008, after Chinese producers and exporters

had reason to believe that an antidumping or countervailing duty proceeding was likely. Petitioners further allege

that there is a history of dumping and material injury by reason of unfairly-traded imports of Chinese OCTG in

Canada. Finally, Petitioners contend that critical circumstances exist because of allegedly WTO-inconsistent

subsidies. Petition, pp. 18-21.

 6 Certain Oil Country Tubular Goods from the People’s Republic of China: Initiation of Countervailing Duty

Investigation, 74 FR 20678, May 5, 2009, presented in app. A.

 7 Certain Oil Country Tubular Goods From the People’s Republic of China: Final Affirmative Countervailing

Duty Determination, Final Negative Critical Circumstances Determination, 74 FR 64045, December 7, 2009.

 8 Certain Oil Country Tubular Goods From the People’s Republic of China: Notice of Preliminary

Determination of Sales at Less Than Fair Value, Affirmative Preliminary Determination of Critical Circumstances

and Postponement of Final Determination, 74 FR 59117, November 17, 2009.

 9

 These data are compiled from confidential Customs information.

IV-8
NEGLIGIBILITY

The statute requires that an investigation be terminated without an injury determination if imports

of the subject merchandise are found to be negligible.10 Negligible imports are generally defined in the

Tariff Act of 1930, as amended, as imports from a country of merchandise corresponding to a domestic

like product where such imports account for less than 3 percent of the volume of all such merchandise

imported into the United States in the most recent 12-month period for which data are available that

precedes the filing of the petition or the initiation of the investigation. However, if there are imports of

such merchandise from a number of countries subject to investigations initiated on the same day that

individually account for less than 3 percent of the total volume of the subject merchandise, and if the

imports from those countries collectively account for more than 7 percent of the volume of all such

merchandise imported into the United States during the applicable 12-month period, then imports from

such countries are deemed not to be negligible.11 Imports from China accounted for 60.0 percent of total

imports of OCTG by quantity from April 2008 - March 2009.

APPARENT U.S. CONSUMPTION

Data concerning apparent U.S. consumption of OCTG during the period of investigation are

shown in table IV-6 and figure IV-1. Apparent U.S. consumption, particularly of seamless OCTG,

increased sharply in 2008 after declining in 2007, with U.S. imports from China accounting for slightly

more than one-half of the increase in 2008. Apparent U.S. consumption in January-September 2009 was

less than half that of January-September 2008.

Table IV-6

OCTG: U.S. shipments of domestic product, U.S. imports, and apparent U.S. consumption, 2006-

08, January-September 2008, and January-September 2009

Item

Calendar year January-September

2006 2007 2008 2008 2009

Quantity (short tons)

U.S. producers’ U.S. shipments 2,805,457 2,381,634 2,986,480 2,225,983 677,514

U.S. imports from–

China 725,027 860,711 2,197,556 1,232,826 739,659

Nonsubject countries 1,204,575 864,612 1,534,713 1,006,389 583,130

Total U.S. imports 1,929,601 1,725,323 3,732,269 2,239,214 1,322,789

Apparent U.S. consumption 4,735,058 4,106,957 6,718,749 4,465,197 2,000,303

Value (1,000 dollars)

U.S. producers’ U.S. shipments 4,166,873 3,304,828 6,184,818 4,079,523 1,383,423

U.S. imports from--

China 681,292 811,542 2,805,206 1,377,072 1,105,138

Nonsubject countries 1,598,489 1,089,955 2,572,888 1,461,709 1,192,040

Total U.S. imports 2,279,781 1,901,497 5,378,094 2,838,781 2,297,177

Apparent U.S. consumption 6,446,654 5,206,325 11,562,912 6,918,304 3,680,600

Source: Compiled from data submitted in response to Commission questionnaires and official Commerce statistics.

 10 Sections 703(a)(1), 705(b)(1), 733(a)(1), and 735(b)(1) of the Act.

 11 Section 771(24) of the Act.

IV-9
Figure IV-1

OCTG: Apparent U.S. consumption, by sources, 2006-08, January-September 2008, and JanuarySeptember 2009

Source: Table IV-6.

U.S. MARKET SHARES

U.S. market share data are presented in table IV-7. Data show that U.S. producers’ share of U.S.

consumption (by quantity) declined by 14.8 percentage points during 2006-08 and was 16.0 percentage

points lower January-September 2009 than in January-September 2008. U.S. imports from China

accounted for a growing share of the U.S. market, increasing in each consecutive period, while the market

share held by nonsubject imports from all other sources fluctuated within a relatively narrow range during

2006-08, but was higher in January-September 2009 than January-September 2008.

IV-10
Table IV-7

OCTG: U.S. consumption and market shares, 2006-08, January-September 2008, and JanuarySeptember 2009

Item

Calendar year January-September

2006 2007 2008 2008 2009

Quantity (short tons)

Apparent U.S. consumption 4,735,058 4,106,957 6,718,749 4,465,197 2,000,303

Value (1,000 dollars)

Apparent U.S. consumption 6,446,654 5,206,325 11,562,912 6,918,304 3,680,600

Share of quantity (percent)

U.S. producers’ U.S. shipments 59.2 58.0 44.4 49.9 33.9

U.S. imports from--

China 15.3 21.0 32.7 27.6 37.0

Nonsubject countries 25.4 21.1 22.8 22.5 29.2

All countries 40.8 42.0 55.6 50.1 66.1

Share of value (percent)

U.S. producers’ U.S. shipments 64.6 63.5 53.5 59.0 37.6

U.S. imports from--

China 10.6 15.6 24.3 19.9 30.0

Nonsubject countries 24.8 20.9 22.3 21.1 32.4

All countries 35.4 36.5 46.5 41.0 62.4

Note.–Because of rounding, figures may not add to the totals shown.

Source: Compiled from data submitted in response to Commission questionnaires and official Commerce statistics.

IV-11
RATIO OF IMPORTS TO U.S. PRODUCTION

Information concerning the ratio of imports to U.S. production of OCTG is presented in table

IV-8. U.S. imports were nearly equivalent to U.S. production during the first three quarters of 2008, and

by the end of the year exceeded U.S. production. U.S. import levels were more than twice U.S.

production levels during the first three quarters of 2009, with U.S. imports from China alone exceeding

U.S. production during the nine-month period.

Table IV-8

OCTG: U.S. production, U.S. imports, and ratios of imports to U.S. production, 2006-08, JanuarySeptember 2008, and January-September 2009

Item

Calendar year January-September

2006 2007 2008 2008 2009

Quantity (short tons)

U.S. production 2,943,048 2,508,029 3,081,518 2,267,478 606,651

Imports from:

China 725,027 860,711 2,197,556 1,232,826 739,659

Nonsubject countries 1,204,575 864,612 1,534,713 1,006,389 583,130

Total imports 1,929,601 1,725,323 3,732,269 2,239,214 1,322,789

Ratio of U.S. imports to production (percent)

Imports from:

China 24.6 34.3 71.3 54.4 121.9

Nonsubject countries 40.9 34.5 49.8 44.4 96.1

Total imports 65.6 68.8 121.1 98.8 218.0

Note.–Because of rounding, figures may not add to the totals shown.

Source: Compiled from data submitted in response to Commission questionnaires and official Commerce statistics.

IV-12
PART V: PRICING AND RELATED INFORMATION

FACTORS AFFECTING PRICES

 Raw Material Costs

Raw materials as a share of cost of goods sold for domestic producers of OCTG decreased

slightly from 60.6 percent in 2006 to 59.9 percent in 2007, and then increased to 69.1 percent in 2008. 

Raw materials for domestic producers of OCTG were 70.6 percent of goods sold during JanuarySeptember 2008, but was 47.5 percent during January-September 2009 as the relative shares of other

factory costs increased following the idling of several OCTG facilities. The key costs in producing

OCTG are raw materials such as hot-rolled steel and billets; inputs such as coke, scrap, pig iron, and hotbriqueted iron; energy; and labor. The price of scrap and the price of hot-rolled coil remained relatively

stable during 2006 and 2007, doubled over the first three quarters of 2008, and then decreased to levels

similar to those at the beginning of the period and to levels below those from 2006-07 in mid-2009

(figures V-1 and V-2). In addition, the prices of natural gas, electricity, and iron ore rose between 2006

and 2008, with noticeable increases for each in 2008 (table V-1). 

U.S. Inland Transportation Costs

Six of seven responding producers and 13 of 36 responding importers indicated that their firm

generally arranges for transportation to the customers’ locations. U.S. producers estimated their U.S.

inland transportation costs were between 2 and 5 percent, with importers estimating that their

transportation costs ranged between 0 (for direct discharge to truck) and 13 percent. 

Figure V-1

Ferrous scrap prices: No. 1 heavy melt, Chicago and Pittsburgh average consumer prices,

monthly, January 2006-November 2009

Source: American Metal Market LLC.

V-1
Figure V-2

Hot-rolled coil prices: Spot prices, monthly, January 2006-October 2009

* * * * * * *

Table V-1

Energy and input prices: U.S. natural gas, electricity, and iron ore average annual prices, 2006-08

and 2009 year-to-date

Item 2006 2007 2008 2009

U.S. natural gas industrial price1 $7.87 $7.68 $9.58

$5.29

 (Jan.-July)

Electricity industrial price2 6.1¢ 6.4¢ 6.9¢

7.0¢ 

(Jan.-Aug)

Iron ore (per metric ton) $53.88 $59.64 $66.00 -

 1 Price to industrial users in dollars per thousand cubic feet.

 2

 Price to industrial users in cents per kilowatt-hour.

Sources: U.S. Energy Information Administration, http://www.eia.doe.gov, official statistics of the U.S. Department

of Energy, http://www.eia.doe.gov/cneaf/electricity/epm/table5_3.html,

http://www.eia.doe.gov/cneaf/electricity/epm/table5_6_b.html, and

http://minerals.usgs.gov/minerals/pubs/commodity/iron_ore/mcs-2009-feore.pdf.

Transportation Costs to the U.S. Market

Transportation costs of OCTG from China to U.S. markets are estimated to be 6.7 percent of the

2008 customs value. These estimates are derived from official import data and represent the

transportation and other charges on imports valued on a c.i.f. basis, as compared with customs value.1

Freight costs, as measured by the Baltic Dry Index, rose noticeably through the summer of 2008, then

dropped sharply through the end of the year and have remained at lower levels in 2009 (figure V-3).

Figure V-3

Baltic Dry Index, November 2006-November 2009

Source: http://stockcharts.com/h-sc/ui, accessed November 11, 2009.

 1 Based on HTS subheadings 7304.29, 7305.20, 7306.20, and 7306.29. 

V-2
PRICING PRACTICES

Pricing Methods

OCTG is sold primarily on a spot basis. Four producers reported that 100 percent of their sales

were on a spot basis and one producer reported that *** percent of its sales are on a long-term contract

basis. Similarly, 17 importers reported that the majority of their sales were on a spot basis, 8 importers

reported that the majority of sales were made using short-term contracts, and one importer reported that

50 percent of its sales occur on a spot basis and 50 percent of its sales were on a short-term contract basis. 

Four of seven responding producers indicated that their prices were determined on a transactionby-transaction basis and the other three producers reported that they use other methods including price

lists or a combination of methods. Twenty-two of 32 responding importers determined prices on a

transaction-by-transaction basis, and the remaining importers set prices mainly according to current

competitive offers or a combination of methods. 

 Sales Terms and Discounts

 Five of seven responding producers and 12 of 31 responding importers reported using discounts

for their sales of OCTG. Three producers and five importers reported offering quantity discounts, while

one producer and seven importers offer early payment discounts. All 7 responding producers and 23 of

the 31 responding importers reported that the majority of their sales are made to order, while 8 importers 

reported that more than 60 percent of their sales are from inventory.

 Producers reported lead times of 1 to 30 days from inventory or 30 to 180 days for sales of

product which is made to order. 

V-3
PRICE DATA

The Commission requested U.S. producers and importers to provide quarterly data on the total

quantity and f.o.b. value for sales of the following three seamless and three welded OCTG products2

 sold

to distributors3

 during January 2006 to September 2009. Price data for these OCTG products are

presented in tables V-2 to V-7 and figure V-4. 

Product 1.--Tubing, Grade J-55, 2 7/8" O.D., 6.5 lbs./ft., threaded and coupled, range 2, seamless

Product 2.--Casing, Grade J-55, 5 1⁄2" O.D., 15.5 lbs./ft., threaded and coupled, range 3, welded

Product 3.--Casing, Grade N-80, 5 1⁄2" O.D., 17.0 lbs./ft., threaded and coupled, range 3, seamless

Product 4.--Casing, Grade J-55, 8 5/8" O.D., 32.0 lbs./ft., threaded and coupled, range 3, welded

Product 5.--Casing, Grade J-55, 9 5/8" O.D., 36.0 lbs./ft., threaded and coupled, range 3, welded

Product 6.--Casing, Grade K-55, 9 5/8" O.D., 36.0 lbs./ft., threaded and coupled, range 3,

seamless

Four U.S. producers (TMK IPSCO, Maverick,4

 U.S. Steel, and V&M Star) provided usable

pricing data for sales of the requested OCTG products, although not all firms reported pricing for all

products and for all quarters. Price data reported by these firms accounted for *** percent of U.S.

producers’ commercial shipments of OCTG during January 2006-September 2009 and are presented in

Tables V-2 to V-7 and Figure V-4. Seventeen importers provided usable pricing data for imports from

China5

 in the final phase of these investigations. Eight other importers provided questionnaire responses

and pricing data in the preliminary phase of these investigations, but not in the final phase; their pricing

data are included in the following tables and figures, although there is no pricing data reported for the last

two quarters of 2009.6

 Price data reported included in Tables V-2 to V-7 and Figure V-4 accounted for

 2 Purchasers were asked to discuss the extent to which the availability, market demand, and price levels of

seamless OCTG affect those for welded OCTG, and vice-versa. Six responding purchasers reported that 90 to 100

percent of their purchases are composed of seamless OCTG, and one purchaser is primarily a welded OCTG

distributor. The remaining 17 responding purchasers purchase both seamless and welded OCTG (seamless OCTG is

usually used for deep high-pressure wells, and welded OCTG is usually used in more shallow wells). Of these latter

purchasers, five firms reported that availability is a main factor in their purchasing decisions (for example, certain

customers will accept purchasing seamless OCTG if welded OCTG is not available), eight noted price (for example,

if seamless OCTG is priced the same as welded OCTG, certain customers would prefer seamless OCTG), two noted

quality, and three firms noted the end users’ applications requirements as a main determinant (for certain

applications only one type of OCTG is acceptable). However, these purchasers indicated that all of the preceding

factors are influenced by market demand.

 3

 The petitioners expressed concern in their questionnaire comments that sales of OCTG by certain importers

represented transactions at a different level of trade than sales by U.S. producers. To alleviate this concern, Staff

collected pricing data for OCTG sold only to distributors and not directly to end users. In addition, Staff has

removed the price data reported by ***, which identified itself as an importer but was subsequently determined to be

a purchaser of imported product.

 4

 ***.

 5

 These firms include ***.

 6

 These firms include ***. These companies accounted for *** percent of the pricing data coverage in the

preliminary phase of these investigations.

V-4
*** percent of commercial shipments of OCTG from China during January 2006-September 2009. In

addition, several importers reported pricing data from nonsubject countries.

Table V-2

OCTG: Weighted-average f.o.b. prices and quantities of domestic and imported product 1,1

 and

margins of underselling, January 2006-September 2009

Period

United States China2

Price Quantity Price Quantity Margin

per 

short ton short tons

per 

short ton short tons percent

2006:

 January-March *** *** $1,171 3,123 ***

 April-June *** *** 1,175 7,273 ***

 July-September *** *** 1,157 12,941 ***

 October-December *** *** 1,107 12,230 ***

2007:

 January-March *** *** 1,306 9,040 ***

 April-June *** *** 1,078 7,793 ***

 July-September *** *** 1,096 6,194 ***

 October-December *** *** 1,029 9,776 ***

2008:

 January-March *** *** 1,130 6,303 ***

 April-June *** *** 1,445 11,393 ***

 July-September *** *** 1,706 13,914 ***

 October-December *** *** 1,859 9,051 ***

2009:

 January-March *** *** 1,578 5,371 ***

 April-June - - *** *** -

 July-September *** *** *** *** ***

 1 Product 1.—Tubing, Grade J-55, 2 7/8" O.D., 6.5 lbs./ft., threaded and coupled, range 2, seamless. 2 Chinese quantities are understated in the last two quarters of 2009 because eight importers provided

questionnaire responses only in the preliminary phase of these investigations.

Source: Compiled from data submitted in response to Commission questionnaires. 

V-5
Table V-3

OCTG: Weighted-average f.o.b. prices and quantities of domestic and imported product 2,1

 and

margins of underselling/(overselling), January 2006-September 2009

Period

United States China2

Price Quantity Price Quantity Margin

per 

short ton short tons

per 

short ton short tons percent

2006:

 January-March $1,018 20,757 - 0 -

 April-June 928 16,354 *** *** ***

 July-September 1,029 18,640 - 0 -

 October-December *** *** - 0 -

2007:

 January-March 1,020 8,271 - 0 -

 April-June *** *** *** *** ***

 July-September *** *** - 0 -

 October-December 978 6,527 - 0 -

2008:

 January-March *** *** $937 1,119 ***

 April-June *** *** 1,295 1,550 ***

 July-September 2,021 14,281 2,153 4,203 (6.5)

 October-December 2,259 5,703 1,658 7,218 26.6

2009:

 January-March *** *** 1,679 1,516 ***

 April-June 1,854 889 *** *** ***

 July-September *** *** *** *** ***

 1 Product 2.—Casing, Grade J-55, 5 1⁄2" O.D., 15.5 lbs./ft., threaded and coupled, range 3, welded. 2 Chinese quantities are understated in the last two quarters of 2009 because eight importers provided

questionnaire responses only in the preliminary phase of these investigations.

Source: Compiled from data submitted in response to Commission questionnaires. 

V-6
Table V-4

OCTG: Weighted-average f.o.b. prices and quantities of domestic and imported product 3,1

 and

margins of underselling, January 2006-September 2009

Period

United States China2

Price Quantity Price Quantity Margin

per 

short ton short tons

per 

short ton short tons percent

2006:

 January-March *** *** $1,189 4,924 ***

 April-June *** *** 1,275 4,045 ***

 July-September *** *** 1,202 4,961 ***

 October-December *** *** 1,120 7,842 ***

2007:

 January-March *** *** 1,298 2,314 ***

 April-June *** *** 1,117 7,175 ***

 July-September *** *** 1,148 4,473 ***

 October-December *** *** 1,116 2,301 ***

2008:

 January-March *** *** 1,161 5,319 ***

 April-June *** *** 1,546 9,729 ***

 July-September *** *** 1,864 18,010 ***

 October-December *** *** 2,018 35,071 ***

2009:

 January-March *** *** 1,870 12,557 ***

 April-June *** *** *** *** ***

 July-September *** *** *** *** ***

 1 Product 3.—Casing, Grade N-80, 5 1⁄2" O.D., 17.0 lbs./ft., threaded and coupled, range 3, seamless. 2 Chinese quantities are understated in the last two quarters of 2009 because eight importers provided

questionnaire responses only in the preliminary phase of these investigations.

Source: Compiled from data submitted in response to Commission questionnaires. 

V-7
Table V-5

OCTG: Weighted-average f.o.b. prices and quantities of domestic and imported product 4,1

 and

margins of underselling/(overselling), January 2006-September 2009

Period

United States China2

Price Quantity Price Quantity Margin

per 

short ton short tons

per 

short ton short tons percent

2006:

 January-March $1,006 17,007 - 0 -

 April-June 1,007 19,242 - 0 -

 July-September 1,007 19,227 - 0 -

 October-December 1,066 11,491 - 0 -

2007:

 January-March 1,022 14,494 - 0 -

 April-June 1,016 14,599 - 0 -

 July-September 1,004 11,425 - 0 -

 October-December 1,001 10,997 - 0 -

2008:

 January-March 1,134 17,057 *** *** ***

 April-June 1,170 17,528 *** *** ***

 July-September 2,088 8,120 $2,399 1,333 (14.9)

 October-December 2,355 4,274 1,809 2,534 23.2

2009:

 January-March *** *** 1,733 3,707 ***

 April-June *** *** *** *** ***

 July-September *** *** *** *** ***

 1 Product 4.—Casing, Grade J-55, 8 5/8" O.D., 32.0 lbs./ft., threaded and coupled, range 3, welded. 2 Chinese quantities are understated in the last two quarters of 2009 because eight importers provided

questionnaire responses only in the preliminary phase of these investigations.

Source: Compiled from data submitted in response to Commission questionnaires. 

V-8
Table V-6

OCTG: Weighted-average f.o.b. prices and quantities of domestic and imported product 5,1

 and

margins of underselling/(overselling), January 2006-September 2009

Period

United States China2

Price Quantity Price Quantity Margin

per 

short ton short tons

per 

short ton short tons percent

2006:

 January-March $1,030 27,449 *** *** ***

 April-June 1,056 34,266 *** *** ***

 July-September 1,041 22,766 *** *** ***

 October-December 1,022 35,443 *** *** ***

2007:

 January-March 1,022 29,038 *** *** ***

 April-June 1,029 31,379 $963 3,283 6.4

 July-September 1,012 23,165 906 3,183 10.5

 October-December 997 30,644 *** *** ***

2008:

 January-March 978 38,201 1,053 1,410 (7.7)

 April-June 1,200 35,279 1,302 2,161 (8.5)

 July-September 2,131 18,411 1,919 10,202 9.9

 October-December 2,241 23,998 1,802 10,740 19.6

2009:

 January-March 1,844 3,312 1,799 11,422 2.4

 April-June *** *** *** *** ***

 July-September *** *** *** *** ***

 1 Product 5.—Casing, Grade J-55, 9 5/8" O.D., 36.0 lbs./ft., threaded and coupled, range 3, welded. 2 Chinese quantities are understated in the last two quarters of 2009 because eight importers provided

questionnaire responses only in the preliminary phase of these investigations.

Source: Compiled from data submitted in response to Commission questionnaires. 

V-9
Table V-7

OCTG: Weighted-average f.o.b. prices and quantities of domestic and imported product 6,1

 and

margins of underselling/(overselling), January 2006-September 2009

Period

United States China2

Price Quantity Price Quantity Margin

per 

short ton short tons

per 

short ton short tons percent

2006:

 January-March *** *** *** *** ***

 April-June *** *** *** *** ***

 July-September *** *** - 0 -

 October-December *** *** $1,032 3,467 ***

2007:

 January-March *** *** *** *** ***

 April-June *** *** *** *** ***

 July-September *** *** *** *** ***

 October-December *** *** - 0 -

2008:

 January-March *** *** *** *** ***

 April-June *** *** *** *** ***

 July-September *** *** 1,587 3,018 ***

 October-December *** *** 1,694 6,440 ***

2009:

 January-March *** *** *** *** ***

 April-June *** *** *** *** ***

 July-September *** *** *** *** ***

 1 Product 6.—Casing, Grade K-55, 9 5/8" O.D., 36.0 lbs./ft., threaded and coupled, range 3, seamless. 2 Chinese quantities are understated in the last two quarters of 2009 because eight importers provided

questionnaire responses only in the preliminary phase of these investigations.

Source: Compiled from data submitted in response to Commission questionnaires. 

Figure V-4

OCTG: Weighted-average f.o.b. prices and quantities of products 1-6, by country, 

January 2006-September 2009

* * * * * * *

V-10
Price Trends

Weighted-average prices for U.S.-produced OCTG generally fluctuated within a narrow range

during 2006 and 2007 with no apparent trend, then increased in the last three quarters of 2008 by over

$1,000 per short ton before declining in 2009 (albeit to levels still generally higher than in 2006-07). 

Prices for imports from China also fluctuated within a narrower range during 2006 and 2007, and

followed the pattern of U.S. prices fairly closely in 2008 and 2009.7

Table V-8

OCTG: Summary of weighted-average f.o.b. prices for products 1-6 from the United States and

China

Item

Number of

quarters

Low price 

(per short ton)

High price

(per short ton)

Change in price1

(percent)

Product 12

 

United States 14 *** *** ***

China 15 *** $1,859 ***

Product 23

United States 15 $928 2,259 ***

China 9 743 2,153 ***

Product 32

United States 15 *** *** ***

China 15 1,116 2,018 ***

Product 43

United States 15 *** 2,355 ***

China 7 *** 2,399 ***

Product 53

United States 15 978 2,241 ***

China 15 906 1,919 ***

Product 62

United States 15 *** *** ***

China 13 *** *** ***

 1 Percentage change from the first quarter in which price data were available to the last quarter in which price data

were available, based on unrounded data.

 2 Products 1, 3, and 6 are seamless OCTG products.

 3

 Products 2, 4, and 5 are welded OCTG products.

 Source: Compiled from data submitted in response to Commission questionnaires.

When purchasers were asked if there was a price leader in the OCTG industry, 27 of the

purchasers reported “yes,” with nearly all purchasers citing more than one U.S. producer. U.S. purchasers

most frequently identified U.S. Steel and V&M Star as price leaders. Most purchasers reported that these

firms exhibited price leadership by being the first to announce changes in price. 

 7 The respondents testified at the hearing that U.S. producers refused to honor contracts throughout 2008. 

Similarly, three purchasers reported that the price at delivery was different than the price at order (see Footnote 4 in

Part II).

V-11
Price Comparisons

As shown in table V-9, there were 73 instances where prices for domestic OCTG and imported

OCTG from China could be compared. U.S.-produced OCTG products were priced higher than imports

from China in 58 of the 73 possible comparisons. In terms of quantity, 94.4 percent of imports of OCTG

from China covered by these comparisons was priced lower than comparable U.S. product. By both

measures, underselling was most pronounced in 2009, and was more prevalent for seamless pricing items

than for welded pricing items.

Table V-9

OCTG: Summary of underselling/(overselling) by product and by year from China, 

January 2006-September 2009

Period

Total price

comparisons Underselling by imports (Overselling) by imports

No.

Quantity

(short tons) No.

Quantity

(short tons)

Range of

underselling

(percentage) No.

Quantity

(short tons)

Range of

(overselling)

(percentage)

 Year

 2006 16 *** 12 *** *** 4 *** ***

 2007 16 *** 12 *** *** 4 *** ***

 2008 24 *** 18 *** *** 6 *** ***

 Jan.-Sept.

2009 17 *** 16 *** *** 1 *** ***

 Product 

 Product 11 14 *** 14 *** *** 0 - -

 Product 22 9 *** 6 *** *** 3 *** ***

 Product 31 15 *** 15 *** *** 0 - -

 Product 42 7 *** 5 *** *** 2 *** ***

 Product 52 15 *** 9 *** *** 6 *** ***

 Product 61 13 *** 9 *** *** 4 *** ***

Total 73 341,606 58 321,290 0.5 to 46.4 15 20,316 (1.3) to (30.4)

 1 Products 1, 3, and 6 are seamless OCTG products. 

 2

 Products 2, 4, and 5 are welded OCTG products.

Source: Compiled from data submitted in response to Commission questionnaires.

V-12
LOST SALES AND LOST REVENUES

In the preliminary and final phase of these investigations, the Commission requested U.S.

producers of OCTG to report any instances of lost sales or revenues they experienced due to competition

from imports from China. U.S. producers provided 25 lost sales allegations but did not provide any lost

revenue allegations. The 25 lost sales allegations regarding China totaled $58,070,698. Staff contacted

the 14 purchasers cited in the allegations; of which 5 purchasers responded.8

 One purchaser agreed with

the lost sales allegations, while four disagreed. Information from purchasers is summarized in table V-10

and discussed below.9

***

Table V-10

OCTG: U.S. producers’ lost sales allegations

* * * * * * *

***. While these companies did not respond to the lost sale allegations in the preliminary phase

of these investigations, they did provide a purchaser questionnaire in the final phase of the investigations

(see the following tabulation).10

* * * * * * *

 8 Purchasers ***, ***, ***, *** and *** responded to seven lost sale allegations. Staff contacted all

unresponsive purchasers in both the preliminary and the final phases of these investigations.

 9

 Three purchasers that did not respond to these specific allegations did provide purchaser questionnaires.

 10 *** and *** attributed shifts in their relative purchase volumes to pricing and availability, while *** did not

report a shift in its relative purchase volumes.

V-13
 
PART VI: FINANCIAL EXPERIENCE OF U.S. PRODUCERS

BACKGROUND

Seven U.S. firms provided usable financial data on their operations on OCTG.1

 These data are

believed to account for the large majority of U.S. operations on OCTG. No firms reported internal

consumption, *** reported transfers to related firms, and *** reported independent tolling operations. 

Transfers to related firms and independent tolling operations each accounted for *** percent of total net

sales in 2008. Accordingly, data for such operations are not presented separately in this section of the

report.2

 All firms reported a fiscal year end of December 31 ***.

U.S. producers were asked to list the various products produced in their facilities that produce

OCTG, and to provide the share of net sales accounted for by these products in their most recent fiscal

year. Six U.S. producers stated that OCTG accounted for 73 percent or more of net sales, with ***

stating that OCTG accounted for 100 percent of net sales. Only *** reported that OCTG comprises a

small amount (*** percent) of total net sales.

OPERATIONS ON OCTG

Income-and-loss data for U.S. firms on their operations on OCTG are presented in table VI-1,

while selected financial data, by firm, are presented in table VI-2. The domestic industry experienced

increasing operating income from 2006 to 2008, followed by a decline in operating income in JanuarySeptember 2009 as compared to January-September 2008. Total net sales quantity and value increased

from 2006 to 2008, with a notably larger increase in net sales value during this time. In JanuarySeptember 2009, both net sales quantity and value were much lower than in January-September 2008. 

The reduction in net sales quantity was somewhat greater than the reduction in net sales value. Thus,

per-short ton net sales value increased from 2006 to 2008, and was higher in January-September 2009 as

compared to January-September 2008. From 2006 to 2008, the per-short ton cost of goods sold

(“COGS”) and selling, general, and administrative (“SG&A”) expenses, combined, increased; however, 

net sales values increased at a greater rate, thus leading to increasing operating income on a per-short ton

basis and as a ratio to sales. In January-September 2009, per-short ton net sales values also increased as

compared to January-September 2008; however, per-short ton COGS and SG&A expenses increased at a

greater rate and thus led to a decline in operating income on a per-short ton basis and as a ratio to sales.

 1 The U.S. producers are ***. Commission staff verified the U.S. producers’ questionnaire response of ***, and

the results of the verification are incorporated in this report.

 2

 Separate financial data on seamless and welded OCTG are presented in appendix C.

VI-1
Table VI-1

OCTG: Results of operations of U.S. producers, 2006-08, January-September 2008, and JanuarySeptember 2009

Item

Fiscal year January-September

2006 2007 2008 2008 2009

Quantity (short tons)

Total net sales 2,940,342 2,469,138 3,128,263 2,316,803 707,619

Value ($1,000)

Total net sales 4,378,324 3,444,495 6,434,811 4,223,978 1,451,262

COGS 2,964,845 2,593,617 4,001,065 2,775,683 1,170,192

Gross profit 1,413,479 850,878 2,433,746 1,448,295 281,070

SG&A expenses 194,752 252,459 336,428 239,019 221,128

Operating income 1,218,727 598,419 2,097,318 1,209,276 59,942

Interest expense 29,410 19,285 22,269 12,927 45,533

Other income/(expense) (8,310) (13,234) (222,048) (30,493) (24,033)

Net income 1,181,007 565,900 1,853,001 1,165,856 (9,624)

Depreciation1 58,298 52,673 131,178 100,066 135,630

Cash flow 1,239,305 618,573 1,984,179 1,265,922 126,006

Ratio to net sales (percent)

 COGS:

 Raw materials 41.0 45.0 42.9 46.3 38.2

 Direct labor 6.7 8.4 5.0 5.6 9.7

 Other factory costs 20.0 21.8 14.3 13.8 32.8

 Total COGS 67.7 75.3 62.2 65.7 80.6

Gross profit 32.3 24.7 37.8 34.3 19.4

SG&A expenses 4.4 7.3 5.2 5.7 15.2

Operating income 27.8 17.4 32.6 28.6 4.1

Net income 27.0 16.4 28.8 27.6 (0.7)

Unit value (per short ton)

Total net sales $1,489 $1,394 $2,056 $1,823 $2,053

 COGS:

 Raw materials 611 628 882 845 783

 Direct labor 100 118 103 102 198

 Other factory costs 297 305 294 251 673

 Total COGS 1,008 1,050 1,279 1,198 1,654

Gross profit 481 345 778 625 397

SG&A expenses 66 102 108 103 312

Operating income 414 242 670 522 85

Net income 402 229 592 503 (14)

Number of firms reporting

Operating losses 00103

Data 77777

Table continued on next page.

VI-2
Table VI-1-- Continued

OCTG: Results of operations of U.S. producers, 2006-08, January-September 2008, and JanuarySeptember 2009

 1 The large increases in depreciation expense in 2008 and January-September 2009 as compared to comparable prior periods

are the result of required asset revaluations by ***. E-mail correspondence from ***, May 4, 2009 and ***, April 30, 2009. 

Note.– Because ***, financial data for all U.S. producers were combined. Although the same underlying product could be reported

more than once using this approach (e.g., an OCTG sale from a mill to a processor may also be reported as a sale of OCTG by a

processor), the effect is reflected in both revenue and COGS and therefore results in a fair presentation of the industry’s

operations.

Note.– Separate financial data on seamless and welded OCTG are presented in appendix C. 

Source: Compiled from data submitted in response to Commission questionnaires.

Table VI-2

OCTG: Results of operations of U.S. producers, by firm, 2006-08, January-September 2008, and

January-September 2009

* * * * * * *

While the overall industry reported a decline in operating income in January-September 2009

relative to January-September 2008, *** firms - *** - reported operating losses during this time.3

 ***

stated that much of its reported increases in other factory costs, depreciation, and SG&A expenses in 2008

and January-September 2009 stemmed from ***.4

 *** reported that the large increase in per-short ton

SG&A expenses between the comparable interim periods largely reflects the fact that much of these costs

are fixed, and thus as sales volume declined such costs increased on a per-short ton basis.5

 *** stated that

its reported operating losses primarily reflect the negative impact of subject imports from China.6

VARIANCE ANALYSIS

A variance analysis for OCTG is presented in table VI-3. The information for the variance

analysis is derived from table VI-1. The analysis shows that the improvement in operating income from

2006 to 2008 is primarily attributable to a favorable price variance that more than offset an unfavorable

net cost/expense variance (that is, prices rose to a greater extent than costs and expenses). From JanuarySeptember 2008 to January-September 2009, the decline in operating income is primarily attributable to

unfavorable volume and net cost/expense variances that were much greater than the favorable price

variance (that is, the decline in volume and increase in costs/expenses outweighed an increase in prices).7

 3 ***. During the period for which data were collected, every measure of operating profitability for seamless

OCTG was higher than every measure of operating profitability for welded OCTG. For welded OCTG, ***. In

contrast, operating income margins for seamless OCTG were ***. Net sales quantities of welded OCTG ***, while

net sales quantities of seamless OCTG ***. U.S. producers were asked to discuss any differences in the

performance of their multiple OCTG production facilities. Their responses are shown in app. G.

 4

 U.S. producers’ questionnaire response of ***, question III-10, and e-mail correspondence from ***, May 4 and

November 11, 2009. ***.

 5

 Postconference brief of ***, exh. 1, pp. 1-5, and e-mail correspondence from ***, November 12, 2009. Staff

confirmed the reported level of SG&A expenses during verification.

 6

 E-mail correspondence from ***, May 11, 2009. Staff notes that, unlike other reporting producers, ***.

 7

 A variance analysis is calculated in three parts, sales variance, cost of sales variance, and SG&A expense

variance. Each part consists of a price variance (in the case of the sales variance) or a cost variance (in the case of

(continued...)

VI-3
Table VI-3

OCTG: Variance analysis on operations of U.S. producers, 2006-08, and January-September 2008-09

Item

Between fiscal years Jan.-Sept.

2006-08 2006-07 2007-08 2008-09

Value ($1,000)

 Total net sales:

 Price variance 1,776,663 (232,181) 2,070,824 161,136

 Volume variance 279,824 (701,648) 919,492 (2,933,852)

 Total net sales variance 2,056,487 (933,829) 2,990,316 (2,772,716)

Cost of sales:

 Cost variance (846,733) (103,903) (715,094) (322,418)

 Volume variance (189,487) 475,131 (692,354) 1,927,909

 Total cost variance (1,036,220) 371,228 (1,407,448) 1,605,491

Gross profit variance 1,020,267 (562,601) 1,582,868 (1,167,225)

SG&A expenses:

 Expense variance (129,229) (88,917) (16,576) (148,125)

 Volume variance (12,447) 31,210 (67,393) 166,016

 Total SG&A variance (141,676) (57,707) (83,969) 17,891

Operating income variance 878,591 (620,308) 1,498,899 (1,149,334)

Summarized as:

 Price variance 1,776,663 (232,181) 2,070,824 161,136

 Net cost/expense variance (975,962) (192,820) (731,670) (470,542)

 Net volume variance 77,890 (195,307) 159,745 (839,928)

Note.-- Unfavorable variances are shown in parentheses; all others are favorable.

Source: Compiled from data submitted in response to Commission questionnaires.

CAPITAL EXPENDITURES AND RESEARCH AND DEVELOPMENT EXPENSES

The responding firms’ aggregate data on capital expenditures and research and development

(“R&D”) expenses are shown in table VI-4. All seven firms provided capital expenditure data, while only

two firms provided data on R&D expenses. Capital expenditures for OCTG increased from 2006 to 2008,

and also increased slightly in January-June 2009 as compared to January-June 2008. *** reported the

large majority of total capital expenditures during the period for which data were collected. According to

***, capital expenditures primarily reflect ***.8

 According to ***, capital expenditures reflect ***.9 10

 7 (...continued)

the cost of sales and SG&A expense variance) and a volume variance. The sales or cost variance is calculated as the

change in unit price times the new volume, while the volume variance is calculated as the change in volume times

the old unit price. Summarized at the bottom of the table, the price variance is from sales; the cost/expense variance

is the sum of those items from COGS and SG&A variances, respectively; and the volume variance is the sum of the

lines under price and cost/expense variance.

 8

 E-mail correspondence from ***, May 4, 2009.

 9

 E-mail correspondence from ***, April 30, 2009.

 10 Capital expenditures for seamless OCTG represented the majority of reported total capital expenditures during

the period for which data were requested, ranging from *** percent in 2006 to *** percent in January-September

2008. While capital expenditures for seamless OCTG increased from 2006-08, such expenditures declined for

(continued...)

VI-4
Table VI-4

OCTG: Capital expenditures and research and development expenses of U.S. producers, 2006-08,

January-September 2008, and January-September 2009

Item

Fiscal year January-September

2006 2007 2008 2008 2009

Value ($1,000)

Capital expenditures:

 Total 124,321 150,807 157,692 103,271 107,987

R&D expenses:

 Total *** *** *** *** ***

Source: Compiled from data submitted in response to Commission questionnaires.

ASSETS AND RETURN ON INVESTMENT

Data on the U.S. producers’ total assets and their return on investment (“ROI”) are presented in

table VI-5. From 2006 to 2008, the total assets for OCTG increased from $4.1 billion in 2006 to $4.8

billion in 2007 and to $7.1 billion in 2008, and the ROI ranged from 12.4 percent (in 2007) to 29.8

percent (in 2006). Much of the increase in current assets relates to increases in the selling prices and

input costs for OCTG, while much of the increase in non-current assets relates to industry restructuring

(e.g., the revaluation of fixed assets and increases in intangible assets). 

Table VI-5

OCTG: Asset values and return on investment of U.S. producers, 2006-08

Item

Fiscal year

2006 2007 2008

Value of assets: Value ($1,000)

Current assets:

 Cash and equivalents 109,321 41,014 371,177

 Accounts receivable, net 497,092 520,255 744,553

 Inventories 892,676 687,215 1,152,863

 Other 69,112 113,285 110,809

 Total current assets 1,568,201 1,361,769 2,379,402

Property, plant and equipment:

Original cost 1,785,788 1,995,927 2,742,986

Less: accumulated depreciation 955,012 923,434 1,214,418

Equals: book value 830,776 1,072,493 1,528,568

Other non-current assets 1,696,864 2,403,948 3,233,979

 Total assets 4,095,841 4,838,210 7,141,949

Operating income or (loss) 1,218,727 598,419 2,097,318

Share (percent)

Return on investment 29.8 12.4 29.4

Source: Compiled from data submitted in response to Commission questionnaires.

 10 (...continued)

welded OCTG. Capital expenditures for seamless OCTG declined between the comparable interim periods, while

such expenditures increased for welded OCTG during this time. 

VI-5
CAPITAL AND INVESTMENT

U.S. producers were asked to describe any actual or potential negative effects of subject imports 

on their firms’ growth, investment, ability to raise capital, development and production efforts, or the

scale of capital investments. In addition, U.S. producers were asked to discuss any differences in the

performance of their multiple OCTG production facilities. Their questionnaire responses are shown in

appendix G.

VI-6
PART VII: THREAT CONSIDERATIONS AND INFORMATION ON

NONSUBJECT COUNTRIES

The Commission analyzes a number of factors in making threat determinations (see 19 U.S.C. §

1677(7)(F)(i)). Information on the nature of the subsidies was presented earlier in this report; information

on the volume and pricing of imports of the subject merchandise is presented in Parts IV and V; and

information on the effects of imports of the subject merchandise on U.S. producers’ existing development

and production efforts is presented in Part VI. Information on inventories of the subject merchandise;

foreign producers’ operations, including the potential for “product-shifting;” any other threat indicators, if

applicable; and any dumping in third-country markets, follows. Also presented in this section of the

report is information obtained for consideration by the Commission on nonsubject countries and the

global market.

THE INDUSTRY IN CHINA

China is the world’s most populous country and has a rapidly growing economy. It is also the

world’s second-leading consumer of oil after the United States, and the third-largest net importer of oil

following the United States and Japan.1

OCTG is among the products that have been encouraged for development by the Government of

China (“GOC”) in its national economic five-year plan.2

 OCTG production also plays a role in the

development of China’s oil and gas industry in the Eleventh Five-Year Plan for Energy Development.3

According to the petitioners, most of the key OCTG producers are also large basic steel producers and

China’s steel industry is a mixture of state-owned and private companies.4

 On December 7, 2008, the

GOC announced a 4 trillion yuan ($586 billion) economic stimulus package, which would include

government investments in public sector projects for two years to promote economic growth.5

 Further, on

May 27, 2009, the GOC announced measures to increase export credit insurance for all merchandise

goods to $84 billion and export credit to $10 billion.6

Global markets, however, have deteriorated and world wide demand for OCTG has declined

rapidly. Chinese seamless pipe producers reportedly lost over half of their export orders in 2009, as

 1 China’s economic growth averaged 10 percent during 2000-08. The current global economic crisis reduced

Chinese annual economic growth from 13 percent in 2007 to 6.1 percent in the first quarter of 2009. Energy

Information Administration, Department of Energy, July 2009, found at

http://www.eia.doe.gov/emeu/cabs/China/Background.html, retrieved October 19, 2009.

 2

 Alan Wm. Wolff, China’s Industrial Policies: The Impact on U.S. Companies, Workers and the American

Economy, Dewey & LeBoeuf, Testimony before a hearing of the U. S.-China Economic and Security Review

Commission, March 24, 2009; found at 

http://www.uscc.gov/hearings/2009hearings/written_testimonies/09_03_24_wrts/09_03_24_wolff_statement.php,

retrieved December 15, 2009. See also Ministry of Commerce of the People’s Republic of China, “Catalogue of

Major Industries, Products and Technologies Encouraged for Development in China,” December 31, 1997 (Petition,

Exhibit III-13).

 3

 Petition, p. 7.

 4

 Petition, p. 106 and Vol. 1, Exhibit I.

 5

 “Impact of China’s $586 billion Remains Unclear,” American Metal Market, November 10, 2008, found at 

http://www.amm.com/2008-11-10__18-09-13.html, retrieved May 1, 2009.

 6

 On May 27, 2009, Premier Premier Wen Jiabao reportedly outlined these measures in a meeting with industry

sources. See “China Unveils New Measures to Boost Exports,” Southeast Asia Iron and Steel Institute (Seaisi), May

28, 2009, found at http://www.seaisi.org/news/news_view.asp?news_id=1293, retrieved May 28, 2009.

VII-1
compared with the same period last year.7

 Similarly, during the first eight months of 2009, China

exported only 1.9 million short tons of welded pipe – a decrease of 26 percent from the same period in

2008,8

 despite an export rebate of China’s value added tax (“VAT”) of 13 percent for most carbon welded

pipe.9

According to the World Steel Association (WSA)10 China has been the world’s leading producer

of all steel tubes since 2002. In 2007, its total production was 45 million short tons, an 18-percent

increase over the 2006 level.11 More specifically, according to ***, during 2002-07, China was the

world’s leading producer of OCTG, accounting for approximately *** of the world’s total OCTG

production in 2007 (table VII-1).12

Table VII–1

OCTG: Published estimates of production of OCTG, by region, 2005-07

* * * * * * *

Table VII-2 highlights China’s recent OCTG capacity developments according to published

sources. Petitioners contend that the quantity of new capacity for seamless pipe in China will increase by

as much as 12.1 million short tons.13 Respondents emphasize the distinction between OCTG production

and capacity and overall tubular operations.14

 7 “Higher Rebate, Oil Price Fail to Lift China's Seamless Pipe Offers,” Metal Bulletin, June 12, 2009, found at

http://www.metalbulletin.com/Article/2231900/Iron/Higher-rebate-oil-price-fail-to-lift-Chinas-seamless-pipe-offers.

html, retrieved June 12, 2009.

 8 See Metal Bulletin, “Chinese Welded Pipe Exporters Slash Prices,” found at

http://www.metalbulletin.com/Article/2319711/Iron/Chinese-welded-pipe-exporters-slash-prices.html, October 20,

2009, retrieved October 20, 2009. Following the Commission’s preliminary decision on OCTG on May 22, 2009,

Vice Premier Wang Qishan advised exporters that the GOC would help exporters maintain global market positions.

See Alfred Cang, “China Aims to Maintain Export Share-Vice Premier,” found at

http://www.iii.co.uk/news/?type=afxnews&articleid=7339653&subject=companies&action=article, retrieved May

27, 2009.

 9

 Metal Bulletin Research, Welded Steel Tube and Pipe Monthly, April 2009, p. 7.

 10 The WSA, formerly known as the International Iron and Steel Institute (IISI), is an international organization

representing approximately 180 steel producers, national and regional steel industry associations, and steel research

institutes. WSA members produce about 85 percent of the world’s steel. WSA provides data for all tubular

products, a much broader category than the subject products.

 11 WSA, Steel Statistical Yearbook 2008, tables 25 and 26. WSA data are reproduced in tables VII-8, 9, and 10 of

this report. The 2009 yearbook had not been published as of the drafting of this staff report.

 12 ***. According to ***’s information, China overtook the United States to become the world’s largest OCTG

producer in 2002. 

 13 U.S. Steel’s prehearing brief, pp. 70-75. Petitioners have asserted that while overall production has been cut to

reduce inventory due to deteriorating demand, China continues to add new capacity during 2009-10 despite having

millions of tons of current excess OCTG capacity. In addition, they contend that China’s OCTG exports are highly

dependent on the U.S. market, its largest export customer, and China will continue to focus on this market. 

Petitioners maintain that a conservative estimate of China’s excess capacity in 2009 would be sufficient to supply the

entire U.S. OCTG market. Hearing transcript, pp. 74, 78, 80, and 87 (Lighthizer) and pp. 87-88 (Surma). See also

presentation entitled Certain Oil Country Tubular Goods from China, attachment to hearing transcript, p. 20. 

 14 Respondents’ posthearing brief, pp. 5-7. Respondents stressed that the OCTG is cyclical in nature and that the

domestic industry is currently going through the downturn phase of the business cycle following record profits over

the past three years. Respondents concluded that since increasing imports from China had no effect on either prices

(continued...)

VII-2
Table VII-2

OCTG: Recent OCTG capacity expansion in China

* * * * * * *

In 2007, there were some concerns regarding the quality of Chinese tube and pipe exports to the

United States.15 However, many of these concerns focused on nonsubject construction pipe, and the

American Institute of Steel Construction, Inc. (AISC) did not find any conclusive evidence regarding the

quality issue.16 According to petitioners, not only has Chinese product quality improved rapidly and

become more widely accepted every year,17 but the Chinese heat treatment facilities utilized in the

production of higher grade pipe are very modern.18 Published sources confirm that many Chinese mills

have begun operations during the last five years while older companies have modernized or expanded

their production facilities recently.19

According to Global Trade Atlas, China has been the world’s leading OCTG exporter in recent

years.20 During 2007-08, China’s OCTG exports increased by almost 2.4 million tons (126 percent) to

nearly 4.3 million tons in 2008, accounting for 43 percent of the world’s total OCTG exports. China’s net

trade surplus in OCTG increased by over 2.4 million tons (141 percent) to 4.1 million tons in 2008,

mostly in seamless OCTG. With respect to home market prospects, most Chinese oil and natural gas

exploration activities have been concentrated in the onshore fields in the western province of Xinjiang,

Sichuan, Gansu, and Inner Mongolia.21

Internationally, Tianjin Pipe Group Corp, China’s largest seamless tube producer, and Wuxi have

continued to invest in new tubular mills in Texas.22 In mid-2010, Tianjin plans to install a $1-billion,

550,000-ton seamless pipe mill in the southern part of the state near Corpus Christi.23 Production is

expected to begin around 2012. At Wuxi's 130,000-net ton facility in Houston, the finishing line is in the

final phase of construction and the heat-treating equipment is expected to be installed in February 2010. 

Wuxi’s finishing line and heat-treatment operations may be expanded further in 2010.24

The Commission sent foreign producer/exporter questionnaires to 200 firms identified in the

petition as producers or exporters of OCTG in China, for which contact information was publicly

 14 (...continued)

or profits in the U.S. market, the domestic OCTG industry is not vulnerable to imports from China. Presentation

entitled Never Better Prepared: Benefitting from a Unprecedented Five-Year Boom, attachment to hearing

transcript, p. 20.

 15 Preston Publishing Company, Preston Pipe and Tube Report, September 2007, p. 1.

 16 Chicago-based AISC is a technical and trade association representing most U.S. structural steel fabricators.

 17 Conference transcript, p. 31 (Horan).

 18 Conference transcript, p. 104 (Barnes).

 19 For example, Tianjin Pipe, China’s largest seamless producer, has expanded tube production, including OCTG,

from *** tons in 2003 to *** tons in 2007. See ***.

 20 The United States, in contrast, was the world’s largest importer of OCTG in 2008. In 2008, U.S. OCTG

imports increased by over 2 million tons to 3.7 million tons. 

 21 “China Energy profile,” Energy Information Administration, U.S. Department of Energy, found at

http://tonto.eia.doe.gov/country/country_energy_data.cfm?fips=CH, retrieved May 1, 2009. 

 22 Conference transcript, p. 83 (Balkenende).

 23 AMM, “Tianjin Pipe Sees Progress on Texas Tube Plant,” November 15, 2009.

 24 Email from ***.

VII-3
available.25 Sixteen firms provided complete responses to the Commission’s questionnaires.26 The names

of the foreign firms along with shares of production and subject exports to the United States (by quantity)

are presented in table VII-3. The responding firms accounted for approximately *** percent of

production capacity of OCTG and related tubular products in China during 2008, and approximately

*** percent of exports from China of OCTG during 2008.27 The Commission asked these foreign firms to

estimate the shares of their firm’s total sales that were represented by sales of OCTG in 2008; firms’

estimates ranged from 2.76 percent to 99 percent of total sales. In response to a question on capacity

changes, several Chinese producers reported plans to change production capacity or production of OCTG

in China.28 Reported exports to the United States (1.5 million short tons) were equivalent to

approximately 66 percent of official Commerce imports (2.2 million short tons) in 2008.

Table VII-3

OCTG: Reporting manufacturers/exporters in China, and quantities and shares of reported

production and exports to the United States, 2008

* * * * * * *

Table VII-4 presents information on Chinese producers’ OCTG operations as compiled from

responses to the Commission’s questionnaires. Table VII-5 presents Chinese tubular capacity and

production, by welded and seamless products. The preponderance of reported overall Chinese capacity

and production is seamless, accounting for more than *** percent of capacity and *** percent of

production during the period for which data were collected. Chinese OCTG capacity rose by 26 percent

from 2006 to 2008 and is projected to return to 2008-levels in 2010, after declining in 2009. Exports to

the United States tripled from 2006 to 2008, compared with an increase of 63 percent to all other markets

but are projected to be lower in both 2009 and 2010.29 Home market shipments, in contrast, were

relatively stable.

 25 Petition, Exhibit General-3 and internet searches.

 26 One firm that responded in the preliminary phase did not respond in the final phase (***). Its responses in the

preliminary phase were used as the data differed only in terms of the interim periods and the inclusion of coupling

stock.

 27 The coverage share is based on the responses to the Commission’s questionnaire as compared to *** and export

data from the Global Trade Atlas database. 

 28 ***.

 29 With respect to projected exports to the United States, ***. Supplemental submission by Respondents,

November 25, 2009.

VII-4
Table VII-4

OCTG: Chinese production capacity, production, shipments, and inventories, 2006-08, JanuarySeptember 2008, January-September 2009, and projected 2009-10

Item

Actual experience Projections

2006 2007 2008

January-September

2008 2009 2009 2010

Quantity (short tons)

Capacity 5,874,812 6,070,377 7,417,424 4,799,034 4,864,836 7,058,446 7,316,480

Production 4,887,922 5,001,893 6,398,144 3,796,308 3,356,921 5,003,148 5,317,351

End of period inventories *** *** *** *** *** *** ***

Shipments:

Internal consumption 114,010 233,127 157,905 6,610 42,028 197,332 283,295

Home market 3,665,323 3,374,831 3,778,732 2,181,666 2,392,745 3,642,609 3,908,227

Exports to--

The United States 484,352 550,251 1,450,503 921,047 250,466 273,272 159,382

All other markets 587,089 810,230 957,575 662,526 672,950 892,000 950,656

Total exports 1,071,441 1,360,482 2,408,078 1,583,573 923,417 1,165,273 1,110,038

Total shipments 4,850,775 4,968,440 6,344,714 3,771,849 3,358,190 5,005,214 5,301,560

Ratios and shares (percent)

Capacity utilization 81.1 80.2 83.4 76.5 68.3 70.9 72.7

Inventories to production *** *** *** *** *** *** ***

Inventories to total

shipments *** *** *** *** *** *** ***

Share of total shipments:

Internal consumption 2.4 4.7 2.5 0.2 1.3 3.9 5.3

Home market 75.6 67.9 59.6 57.8 71.3 72.8 73.7

Exports to--

The United States 10.0 11.1 22.9 24.4 7.5 5.5 3.0

All other markets 12.1 16.3 15.1 17.6 20.0 17.8 17.9

All export

markets 22.1 27.4 38.0 42.0 27.5 23.3 20.9

Note.–Because of rounding, figures may not add to the totals shown. Interim data do not include ***, resulting in a modest

understatement for these periods.

Source: Compiled from data submitted in response to Commission questionnaires.

VII-5
Table VII-5

OCTG: Chinese capacity, production, and capacity utilization of welded and seamless tubular

products, 2006-08, January-September 2008, and January-September 2009

* * * * * * *

Respondents provided information from the China Steel Pipe Association concerning OCTG

capacity, production, and shipments within China. The capacity was compiled from information collected

from its member companies;30 production data is compiled from the state statistics bureau (China); and

export data was obtained from the Chinese Customs maintained on the association’s website. These data

are presented in the following tabulation:

* * * * * * *

U.S. INVENTORIES OF PRODUCT FROM CHINA

Data collected in these investigations on U.S. importers’ end-of-period inventories of OCTG are

presented in table VII-6. Twenty U.S. importers reported holding inventories of OCTG from China in

December 2008, and 16 in September 2009.

Table VII-6

OCTG: U.S. importers’ end-of-period inventories of imports, 2006-08, January-September 2008,

and January-September 2009

* * * * * * *

U.S. IMPORTERS’ CURRENT ORDERS

The Commission requested importers to indicate whether they imported or arranged for the

importation of OCTG from China after September 30, 2009. One firm *** reported having arranged for

the importation of OCTG from China (***).31 Table VII-7 presents U.S. importers' orders of OCTG from

China after September 30, 2009, by month. Sixteen importers reported orders totaling 106,915 short tons

of OCTG from all other sources.

 30 Data provided by the Tubular Goods Research Center suggest that production estimates are based on the

operations of *** producers. Respondent’s posthearing brief, exhibit 8, note to table 1.

 31 U.S. importers’ questionnaire responses, section II-3.

VII-6
Table VII-7

OCTG: U.S. importers’ orders after September 30, 2009

Quantity (in short tons)

Source October

2009

November

2009

December

2009

January

2010

February

2010

March

2010

Imports from--

 China *** 0 0 0 0 0

 All other sources *** 24,168 20,547 27,551 8,582 4,210

 Total *** 24,168 20,547 27,551 8,582 4,210

Source: Compiled from data submitted in response to Commission questionnaires.

ANTIDUMPING INVESTIGATIONS IN THIRD-COUNTRY MARKETS

On March 10, 2008, the Canadian International Trade Tribunal (“CITT”) issued a finding that

“the dumping and subsidizing of seamless carbon or alloy steel oil and gas well casing originating in or

exported from the People's Republic of China have not caused injury but are threatening to cause injury to

the domestic industry.” The CITT’s inquiry covered seamless carbon or alloy steel oil and gas well

casing, whether plain end, beveled, threaded or threaded and coupled, heat-treated or non-heat-treated,

meeting American Petroleum Institute specification 5CT, with an outside diameter not exceeding

11.75 inches (298.5 mm), in all grades, including proprietary grades.32

On October 23, 2009, CITT issued a preliminary determination that there is evidence that

discloses a reasonable indication that dumping and subsidizing of OCTG originating in or exported from

the People’s Republic of China, made of carbon or alloy steel, welded or seamless, heat-treated or not

heat-treated, regardless of end finish, having an outside diameter from 2d inches to 13d (60.3mm to

339.7mm), meeting or supplied to meet API specification 5CT or equivalent standard, in all grades,

excluding drill pipe and excluding seamless casings up to 113⁄4 inches (298.5mm) in outside diameter,

have caused injury or retardation or are threatening to cause injury.33

The European Union conducted an investigation on seamless pipe (including OCTG) from China,

and in April 2009 imposed provisional antidumping duties with margins ranging from 35 to 51 percent on

seamless pipe “used in a wide variety of applications, like for mechanical uses (including automotive and

engineering), in the construction business for piling, for power generation like boiler tubes, as oil country

tubular goods (OCTG) used for drilling, casing and tubing in the oil industry, and as line pipes to

 32 See generally Canadian International Trade Tribunal, Dumping and Subsidizing Finding And Reasons, Inquiry

No. NQ-2007-001, Seamless Carbon or Alloy Steel Oil and Gas Well Casing, findings issued March 10, 2008 and

Reasons issued March 25, 2008. The report noted that the Canada Border Services Agency (CBSA) had previously

determined that the weighted average margin of dumping was 62 percent and that the weighted average amount of

subsidy was 19 percent.

 33 See generally Canadian International Trade Tribunal, Dumping and Subsidizing Determination, Preliminary

Inquiry No. Pl-2009-003, Oil Country Tubular Goods, determination issued October 23, 2009. After hearing

arguments with respect to tubing, seamless casing, welded casing, green tubes, and coupling stock, the CITT

observed that “The Tribunal is unable to conclude, at this preliminary stage, that there is more than one class of

goods. For the purposes of determining whether there is a reasonable indication of injury, the Tribunal will consider

that OCTG constitute a single class of goods. However, the Tribunal finds that the arguments made in support of

coupling stock constituting a separate class of goods from other OCTG merit further consideration.” Id., pp. 3-4.

VII-7
transport liquids or gases.”34 Subsequently, the European Union imposed definitive antidumping duties

ranging from 17 to 39 percent.35 In addition, the European Union imposed definitive antidumping duties

on welded pipe from Belarus, China, and Russia in December 2008.36 However, the product at issue in

those investigations was “welded tubes and pipes, of iron or non-alloy steel, of circular cross-section and

of an external diameter not exceeding 168,3 mm, excluding line pipe of a kind used for oil or gas

pipelines, casing and tubing of a kind used in drilling for oil or gas, precision tubes and tubes and pipes

with attached fittings suitable for conducting gases or liquids for use in civil aircraft.”37

Russia reportedly concluded its own antidumping duty investigation on steel pipe from China in

October 2009. The investigation found that Chinese market share of steel pipe increased from 8.9 percent

in 2007 to 14 percent in 2008. A five-year antidumping duty of 29.4 percent has been proposed.38

Argentina reportedly instituted an antidumping duty investigation on steel pipe from China on

November 4, 2009. The scope of the investigation includes seamless and welded steel pipe with an

external diameter less than 103⁄4 inches. Alloy, carbon, spiral, and straight-seam steel pipe and CR and

HR pipes are included in the investigation.39

INFORMATION ON NONSUBJECT COUNTRIES

Most published data on steel pipes and tubes distinguish OCTG and line pipe from other forms of

pipe (including standard pipe and various forms of structural and mechanical pipe, pressure pipe, and

piling). That is, in terms of demand factors, most analysis focuses on energy applications or structural

applications, very broadly defined. In addition, published analyses of supply factors are often grouped at

an even more aggregate level, combining all forms of seamless pipe and all forms of welded pipe,

reflecting in part a commonality among raw materials and some overlap of production facilities and

methods. Accordingly, for the purpose of this market review, information and data are provided based on

their availability, and may include both subject and nonsubject pipe.

OCTG is produced in substantial quantities by pipe and tube producers throughout the world. 

The WSA publishes data on the global production of the larger product grouping of all pipe and tube. As

shown in tables VII-8 through VII-10, global pipe and tube production, increased significantly between

2004 and 2007 with China accounting for the vast majority of the growth.

 34 Official Journal of the European Union, Commission Regulation (EC) No. 289/2009, L 94/48, April 8, 2009.

 35 Official Journal of the European Union, Commission Regulation (EC) No. 926/2009, L 262/19, October 6,

2009.

 36 Postconference brief of petitioner U.S. Steel, p. 45; postconference brief of petitioners TMK IPSCO, V&M,

Wheatland, RMSM, and the USWA, p. 24; postconference brief of petitioner Maverick, p. 28 (which also noted a

safeguard action in Ukraine covering seamless casing, effective October 1, 2008).

 37 Official Journal of the European Union, Commission Regulation (EC) No. 1256/2008, L 343/1, December 19,

2008. (Emphasis added).

 38 “Russia may impose an anti-dumping tariff on China’s steel pipe.” Alibaba. October 19, 2009,

http://news.alibaba.com/article/detail/metalworking/100186174-1-russia-may-impose-an-anti-dumping.html,

accessed on November 9, 2009.

 39 “Argentina carried out anti-dumping investigation on China’s steel pipe.” Alibaba. November 5, 2009,

http://news.alibaba.com/article/detail/metalworking/100195594-1-argentina-carried-out-anti-dumping-investigation.h

tml, accessed on November 9, 2009.

VII-8
Table VII-8

Welded and seamless steel pipe and fittings: Global production, by region, 2004-07

Region

2004 2005 2006 2007

Quantity (1,000 short tons)1

North America:

 United States 3,363 5,081 5,410 5,049

 Canada 2,995 3,127 3,250 2,886

 Mexico 1,360 1,462 1,467 1,315

 Sub total 7,718 9,668 10,128 9,251

South America:

 Argentina 942 950 963 925

 Others 597 595 669 0

 Subtotal 1,540 1,545 1,633 925

Asia:

 China 23,693 31,863 38,504 45,481

 Japan 9,540 9,318 9,460 9,576

 Korea 4,720 4,487 4,549 4,856

 Others 3,063 3,099 3,466 3,157

 Subtotal 41,017 48,767 55,978 63,069

European Union (15):

2

 Austria 581 623 702 720

 Germany 3,849 4,048 4,339 4,392

 Others 9,709 9,630 10,318 11,025

 Subtotal 14,139 14,300 15,358 16,137

Others 3,406 3,510 3,103 3,064

 Total 67,819 77,792 86,200 92,444

 1 The data presented in this table are for all pipe and tube, and so are substantially overstated with respect to

the OCTG subject to these investigations. Data were not published for Colombia, the Commonwealth of

Independent States, India, Thailand, and Turkey in 2004-07. The original data were published in metric tons,

which were converted to short tons by multiplying by 1.1023. Because of rounding, figures may not add to the

totals shown.

 2

 The EU15 includes Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy,

Luxembourg, the Netherlands, Portugal, Spain, Sweden, and the United Kingdom.

Source: World Steel Association, Steel Statistical Yearbook, 2008.

VII-9
Table VII-9

Seamless steel pipe: Global production, by region, 2004-07

Region

2004 2005 2006 2007

Quantity (1,000 short tons)

1

North America:

 United States 2,078 2,184 2,293 1,908

 Canada 0 0 0 0

 Mexico 748 822 823 732

 Subtotal 2,826 3,006 3,116 2,640

South America:

 Argentina 942 950 963 925

 Others 597 595 669 0

 Subtotal 1,540 1,545 1,633 925

Asia:

 China 9,349 12,608 16,975 20,039

 Japan 2,105 2,237 2,307 2,281

 Korea 19 21 22 22

 Others (2

) (2) (2) (2)

 Subtotal 11,473 14,866 19,305 22,341

European Union (15):

3

 Austria 370 428 473 492

 Germany 1,653 1,786 1,958 2,011

 Others 2,067 2,103 2,288 2,384

 Subtotal 4,091 4,317 4,719 4,886

Others 1,321 1,365 1,517 1,595

 Total 21,249 25,098 30,289 32,387

 1 The data presented in this table are for all seamless pipe and tube, and so are substantially overstated with

respect to the OCTG subject to these investigations. Data were not published for Colombia, the Commonwealth of

Independent States, India, Thailand, and Turkey in 2004-07. The original data were published in metric tons,

which were converted to short tons by multiplying by 1.1023. Because of rounding, figures may not add to the

totals shown.

 2 Not available.

 3

 The EU15 includes Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy,

Luxembourg, the Netherlands, Portugal, Spain, Sweden, and the United Kingdom.

Source: World Steel Association, Steel Statistical Yearbook, 2008.

VII-10
Table VII-10

Welded steel pipe: Global production, by region, 2004-07

Region

2004 2005 2006 2007

Quantity (1,000 short tons)1

North America:

 United States 1,166 2,628 2,828 2,849

 Canada 2,717 2,837 2,948 2,618

 Mexico 555 580 591 529

 Subtotal 4,438 6,044 6,368 5,997

South America:

 Argentina (2

) (2) (2) (2)

 Others (2

) (2) (2) (2)

 Subtotal (2

) (2) (2) (2)

Asia:

 China 13,013 17,468 21,213 23,081

 Japan 6,745 6,424 6,489 6,618

 Korea 4,265 4,052 4,107 4,385

 Others 2,779 2,811 3,106 2,864

 Subtotal 26,802 30,755 34,915 36,948

European Union (15)

3

 Austria 191 177 208 207

 Germany 1,992 2,052 2,160 2,160

 Others 6,933 6,828 7,284 7,839

 Subtotal 9,116 9,057 9,652 10,206

Others 1,892 1,946 1,443 1,333

 Total 42,248 47,803 52,378 54,484

 1 The data presented in this table are for all welded pipe and tube, and so are substantially overstated with

respect to the OCTG subject to these investigations. Data were not published for Colombia, the Commonwealth of

Independent States, India, Thailand, and Turkey in 2004-07. The original data were published in metric tons,

which were converted to short tons by multiplying by 1.1023. Because of rounding, figures may not add to the

totals shown.

 2

 Not available.

 3

 The EU15 includes Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy,

Luxembourg, the Netherlands, Portugal, Spain, Sweden, and the United Kingdom.

Source: World Steel Association, Steel Statistical Yearbook, 2008.

VII-11
In early 2008, even as the world’s economies slowed, energy-related tubular products remained

relatively healthy because sharply rising energy prices kept exploration projects profitable, especially in

the United States, the largest market for OCTG.40 Prices in the U.S. market for OCTG increased sharply

to a record level in the summer of 2008 but average spot prices for both seamless and welded OCTG

began falling in November, according to Pipe Logix.41 By April 2009, MBR reported that the welded

OCTG market was “in disarray,” with the domestic industry virtually shut down, drilling rate falling and

inventory building up rapidly.42 Only recently, in certain areas, such as the Gulf Coast region, have prices

begun to stabilize and inventories to decline.43 In the U.S. market, MBR maintains that since energy

prices are climbing, drilling activities and OCTG prices are expected to follow. MBR, however, stresses

that OCTG inventory holes are still too small to spark a recovery in prices.44

As shown in table VII-11 the United States was the leading import market for OCTG during

2008, while China was the leading exporter. Table VII-12 contrasts the rig counts in the United States

with those in the primary countries that export OCTG to the United States.

 40 The demand for tubular products that are related to the housing, construction, transportation, and automotive

industries has been sharply reduced. In the energy-related tubular products market, because of the sharply increasing

energy prices, activities remained healthy until November when industry observers began to observe signs of

reductions in oilfield activities. Metal Bulletin Research, Seamless Steel Tube and Pipe Monthly, August 2008, p. 1;

and Mario Guzzo, “ OCTG Facing Spillover from Drilling Downturn,” American Metal Market, November 19,

2008, found at http://www.amm/2008-11-19__16-53-49.html, retrieved November 19, 2009.

 41 Pipe Logix Inc is a Santa Fe, NM-based subsidiary of energy consulting firm Spears & Associates Inc, Tulsa,

OK. Mario Guzzo, “ OCTG Facing Spill Over from Drilling Downturn,” American Metal Market, November 19,

2008, found at http://www.amm/2008-11-19__16-53-49.html, retrieved November 19, 2009.

 42 Metal Bulletin Research, Welded Steel Tube and Pipe Monthly, April 2009, p. 3.

 43 Metal Bulletin Research, Seamless Steel Tube and Pipe Monthly, September 2009, p. 3 and Metal Bulletin

Research, Welded Steel Tube and Pipe Monthly, September 2009, p. 4. See also American Metal Market, “OCTG

imports rise as duty vs. China leaves gap in US,” November 16, 2009.

 44 According to Baker Hughes, the total number of drill rigs running in the United States was 1,161 as of

December 11, 2009, an increase of nearly 31 percent from 887, the lowest rig count of the year, that occurred on

June 5, 2009. Canadian drill rigs increased by 462 percent to 354 rigs on December 11, 2009, from 63 on May 8,

the lowest count of the year.

VII-12
Table VII-11

OCTG: Net trade positions of major subject and nonsubject countries, 2006-08

Country Calendar year

2006 2007 2008

Quantity (short tons)

 Imports into:

China 351,326 219,303 163,659

Japan 1,833 224 36

Argentina 6,953 6,495 6,308

Singapore 196,987 789,256 197,624

Mexico 5,674 23,658 37,486

United States 1,914,937 1,724,800 3,749,140

Germany 13,233 19,323 14,727

Ukraine 21,715 22,067 28,654

Russia 249,841 309,381 348,050

South Korea 4,351 8,956 7,473

France 73,419 75,925 38,370

Austria 6,788 5,212 7,249

Canada 569,457 242,356 456,911

Indonesia 44,379 83,928 229,379

Italy 226 571 498

All others 1,193,247 1,300,197 2,296,015

World 4,654,366 4,831,652 7,581,577

Exports from:

China 1,299,439 1,927,645 4,280,628

Japan 1,074,892 788,535 855,996

Argentina 469,848 445,621 541,368

Singapore 227,676 217,593 676,710

Mexico 458,987 328,469 324,944

United States 413,491 298,208 366,915

Germany 363,634 289,452 342,435

Ukraine 299,535 293,482 274,354

Russia 353,382 252,102 236,673

South Korea 215,908 227,277 385,514

France 273,998 243,337 259,445

Austria 243,443 232,193 216,309

Canada 150,598 155,269 256,461

Indonesia 48,218 154,783 125,920

Italy 86,205 77,109 149,949

All others 676,722 636,198 745,191

World 6,655,978 6,567,273 10,038,811

Table continued on next page.

VII-13
Table VII-11--Continued

OCTG: Net trade positions of major subject and nonsubject countries, 2006-08

Country Calendar year

2006 2007 2008

Trade balance of:

China 948,112 1,708,342 4,116,969

Japan 1,073,060 788,311 855,960

Argentina 462,896 439,126 535,060

Singapore 30,689 (571,663) 479,086

Mexico 453,313 304,812 287,458

United States (1,501,446) (1,426,592) (3,382,225)

Germany 350,401 270,129 327,708

Ukraine 277,821 271,415 245,700

Russia 103,541 (57,279) (111,377)

South Korea 211,557 218,321 378,041

France 200,579 167,412 221,075

Austria 236,655 226,981 209,060

Canada (418,859) (87,087) (200,450)

Indonesia 3,838 70,855 (103,459)

Italy 85,979 76,538 149,451

All others (516,526) (663,999) (1,550,825)

World 2,001,612 1,735,621 2,457,234

Note.--Data excludes Malaysia. Positive numbers presented for “trade balance” show net exports and numbers in

parentheses presented for “trade balance” show net imports. Based on top 15 exporting countries over 2006-08.

Note.–With respect to 2009, partial year data indicate that China imported 67,932 short tons, exported

1,390,120 short tons, and maintained a trade balance of 1,322,187 short tons for January-June.

Source: Compiled from the Global Trade Atlas database, HTS subheadings 7304.29, 7305.20, 7306.20, and

7306.29.

Recently, as China’s OCTG exports to the United States declined, replacement imports have

reportedly been ordered from India, South Korea, and other suppliers. However, due to currently weak

market conditions, these orders remain small, typically ranging from 500 to 1,000 short tons.45 MBR

noted that U.S. seamless OCTG production levels have remained low but stable for most of the year, and

that there are signs that producers are increasing production for certain products. Tenaris, for example,

has recalled workers and plan to increase production in Canada.46

 45 American Metal Market, "OCTG Imports Rise as Duty vs. China Leaves Gap in U.S.," November 13, 2009,

found at http://investor.shareholder.com/bhi/rig_counts/rc_index.cfm, retrieved December 3, 2009.

 46 Metal Bulletin Research, Seamless Steel Tube and Pipe Monthly, October 15, 2009, p. 4.

VII-14
Table VII-12

OCTG: Baker Hughes International Rig Count of selected countries, November 2009

Country

Rig counts

Highest (date) Lowest (date) November 2009

United States 2,014 (9/08) 895 (6/09) 1,107

Argentina 88 (4/08) 42 (8/09) 56

Austria 3 (10/09) 0 (8/09) 3

Canada 715 (2/06) 72 (5/09) 277

Colombia 43 (6/08) 9 (10/04) 28

Germany 12 (11/08) 2 (12/04) 6

India 98 (10/09) 71 (4/09) 98

Japan 6 (6/08) 1 (1/09) 3

Mexico 130 (9/09) 112 (8/04) 123

All other N/A N/A 708

Total N/A N/A 2,409

 Note.--Data for China, Russia, and Korea are not available.

Source: Baker Hughes International Rig Count, September 2009, found at

http://investor.shareholder.com/bhi/rig_counts/rc_index.cfm; retrieved December 17, 2009.

Argentina

According to the U.S. Department of Energy, Argentina is the largest natural gas producer in

South America and a net oil exporter.47 It also had 56 active rotary rigs as of November 2009.48 In 2008,

Argentina was the world’s fourth largest exporter of OCTG, exporting over half a million tons, most of

which was seamless OCTG.49

The primary OCTG producer in Argentina is Tenaris Siderca (“Siderca”) with an estimated

capacity of approximately *** tons available for the production of seamless API pipe.50 Siderca is a

wholly-owned subsidiary of Tenaris, a leading global tube maker. The company produces a wide range

of products including OCTG and line pipe.51 Siderca is the only known producer of seamless OCTG in

 47 Energy Information Administration, Argentina Energy Profile, April 10, 2009,found at

http://tonto.eia.doe.gov/country/country_energy_data.cfm?fips=AR, retrieved May 1, 2009.

 48 Staff telephone interview with ***, May 1, 2009; and International Rotary Rig Count, Baker Hughes

Incorporated, found at http://investor.shareholder.com/bhi/rig_counts/rc_index.cfm, retrieved May 2, 2009.

 49 Argentina thus was the world’s sixth largest producer of OCTG in 2007, according to ***.

 50 ***.

 51 Simdex Steel Tube Manufacturers Worldwide Guide, 2009.

VII-15
Argentina.52 Casing and tubing are believed to account for the largest share of the company’s seamless

production operations.53 Another pipe maker, Tubhier, produces a small amount of welded carbon and

low-alloy steel OCTG, line pipe and standard pipe on its two mills in San Luis.

Austria

Austria’s domestic market for OCTG is limited since the country has few active rotary rigs.54

According to Global Trade Atlas, Austria’s largest export customer, the United States, accounted for

about 43 percent of its OCTG exports in 2008. Other export markets include North Africa, the CIS, and

China. In 2008, Austria was the world’s thirteenth largest exporter of OCTG, mostly seamless (table

VII-11).

Voestalpine Tubulars (“Voestalpine”) is the only known OCTG manufacturer in Austria. Its

annual production amounts to 385,000 tons covering a wide range of seamless tubes and pipes, including

line pipe and drill pipe, up to an outside diameter of 7 inches.55 Voestalpine is a joint venture between the

Voestalpine AG, a steel group located in Austria and the U.S.-based Grant Prideco, one of the world’s

largest manufacturers of drill pipe and related products.56 According to an industry source, Voestalpine is

a high-quality producer focusing on the high end of the market and its production lines are equipped with

modern automatic facilities.57

Canada

In 2008, Canada ranked third in the world in natural gas production and seventh in oil production

and is a net exporter of natural gas and oil.58 The rig count for Canada stood at 277 as of November 2009. 

Early in 2009, the Petroleum Services Association of Canada recently forecasted that there will be 13,500

drilled wells in Canada in 2009. Then on November 5, 2009, the forecast was reduced to 8,000 drilled

wells. This is a decrease of over 50 percent from the previous year and a nearly 70-percent decline from a

peak of 25,000 wells in 2005. MBR stressed that the Association has revised its forecast downward

before and very likely will do so again.59

 52 Oil Country Tubular Goods from Argentina, Italy, Japan, Korea, and Mexico, Investigation Nos. 731-TA-711

and 713-716 (Second Review), USITC Publication 3923, June 2007, p. IV-11.

 53 Oil Country Tubular Goods from Argentina, Italy, Japan, Korea, and Mexico, Investigation Nos. 731-TA-711

and 713-716 (Second Review), USITC Publication 3923, June 2007, p. IV-11.

 54 According to Baker Hughes, in September 2009, Austria has two active rigs which are classified as

“miscellaneous” (i.e., not for the oil or gas industry) and there has been no active rig in Austria at any other time. 

 55 Voestalpine’s website, found at http://www.vatubulars.com, retrieved May 4, 2009; and staff telephone

interview with ***, May 1, 2009. 

 56 In this joint venture, each partner owns 50 perecnt of the total equity. Voestalpine’s website, found at 

http://www.vatubulars.com, retrieved May 4, 2009. 

 57 This is in line with the EU marketing strategy, which is reportedly to focus on the high end of the market. Staff

telephone interview with ***, May 1, 2009. 

 58 Energy Information Administration, Canada Energy Profile, October 13, 2009, found at

,http://tonto.eia.doe.gov/country/country_energy_data.cfm?fips=CA retrieved October 23, 2009. 

 59 Metal Bulletin Research, Seamless Steel Tube and Pipe Monthly, February 2009, p. 5. Telephone interview

with ***, MBR’s U.S. Office, November 9, 2009.

VII-16
*** estimates that Canada has *** short tons of seamless API pipe capacity and *** short tons of

API welded pipe capacity.60 This level serves as an approximated upper limit for production capacity by

reporting companies. Several Canadian companies produce casing and tubing. Some of these firms are

owned by non-Canadian parent companies. These include the Carlyle Group, a U.S. investment firm,

which also owns Wheatland Tube; Evraz, a Russian steel firm which owns OSM-Camrose in Alberta; 

Evraz-TMK, which purchased IPSCO production facilities both in Canada and in the United States; and

Tenaris (Luxembourg), which purchased Maverick in October 2006, complementing its existing Canadian

holdings in Calgary and Sault Ste. Marie.

Colombia

According to the U.S. Department of Energy, Colombia is an important oil exporter in South

America. During the last few years, its oil production has stabilized after a period of sharp decline.

Colombia is self-sufficient in natural gas and has recently begun exporting to Venezuela.61 As of

November 2009, Columbia had 28 active rotary rigs.62 Most exploration activities were in the

Cusiana/Cupiagua area where BP operates the largest of Colombia’s oil fields. Others are small fields

spreading throughout the eastern Amazonian jungles and the Andes foothills.63

In 2008, Colombia’s total OCTG exports amounted to 101,000 tons, largely destined to the

United States. Turbocaribe is the only known energy tubular producer in Colombia. Founded in 1991, it

is wholly-owned by Tenaris with a capacity of 165,000 tons. Tubocaribe produces a wide variety of

tubular products including OCTG and line pipe. Most of these are welded pipes for the North and South

American markets.64

Germany

Germany imports nearly all of its oil; 65 the Baker Hughes rig count for Germany as of November

2009 was 6. Nonetheless, Germany is the largest OCTG manufacturer in Europe, producing *** tons in

2007 as estimated by ***. This is a 14-percent decrease from the peak level in 2006 (table VII-1). The

leading OCTG producer in Germany is V&M DEUTSCHLAND GmbH Oil & Gas Division located in

Düsseldorf-Rath (“V&M”). In addition to other products, V&M also produces seamless casing and

tubing with diameters ranging from 2 3/8 inches to 26 inches. Markets for V&M include the United

 60 ***.

 61 Energy Information Administration, Colombia Energy Profile, October 13, 2009, found at

http://www.eia.doe.gov/emeu/cabs/Colombia/Oil.html, retrieved October 2009.

 62 International Rotary Rig Count, Baker Hughes Incorporated, found at

http://investor.shareholder.com/bhi/rig_counts/rc_index.cfm, retrieved May 2, 2009.

 63 Energy Information Administration, Colombia Energy Profile, October 13, 2009, found at

http://www.eia.doe.gov/emeu/cabs/Colombia/Oil.html, retrieved October 2009.

 64 Tubocaribe company website, found at http://www.tenaris.com/Colombia/es/default.aspx, retrieved May 2,

2009.

 65 The Economist Intelligent Unit, Country Profile 2008, London, p. 16.

VII-17
States, China, CIS, Eastern Europe, Norway, Austria, Greece and Libya.66 Overall capacity in Germany

to produce seamless and welded API pipe is estimated to be approximately *** short tons.67

India

Both the Asian Development Bank and the International Monetary Fund expect India’s economy

to grow between 6 and 7 percent in 2009 and 2010.68 Along with its strong economic growth, India’s

consumption of oil and gas have increased rapidly. Although major new reserves have recently been

discovered, India still has to rely on imports to meet its oil and natural gas needs.69 As of November

2009, India’s rig count stood at 98, its highest level.

*** estimates that India produced only *** tons of OCTG in 2007, a fraction of the production of

China and the United States (table VII-1). However, Indian steel pipe producers are well known, and

include ArcelorMittal, Jindal, and Welspun. In the last few years, India has invested in several facilities

to produce welded energy-related tube and pipe. Recent important projects to increase OCTG production

in India include: Jindal SAW Limited (***-short ton seamless plant in Maharashtra in 2008), Rastriya

Ispat Nigam Limited (***-short ton seamless line in Anhra Pradesh), ISMT Limited (a total expansion of

over *** short tons at two existing seamless plants, in Ahmedabad and in Baramati), and United Seamless

Tubular Pvt Ltd (***-short ton seamless pipe mill in Andhra Pradesh). Overall capacity to produce API

pipe in India is substantial but believed to be directed primarily to line pipe or other non-OCTG pipe.70

Japan

Although Japan is the third largest oil consumer behind the United States and China, it has very

limited oil and natural gas resources and must rely almost completely on imports to meet its needs.71 As

of November 2009, Japan had only 3 active rotary rigs.72 As such, Japan exports almost all of its OCTG

production.

According to ***, Japan produced *** of OCTG in 2007, ranking third, behind China and the

United States (table VII-1).73 In a 2007 review, Sumitomo was identified as the largest Japanese producer

of OCTG; the second largest was Nippon Steel, followed by NKK Tubes.74 Japanese capacity to produce

 66 Company’s website, found at

http://www.vmtubes.com/jsp/epctrl.jsp?con=vmtubes000117&cat=vmtubes000032&mod=vmtubes000019&pri=vmt

ubes&lng=1, retrieved May 4, 2009.

 67 ***.

 68 “ADB Lifts Growth Forecasts for India in 2009 and 2010 to 6 Percent and 7 Percent,” Asian Development

Bank, September 22, 2009, found at http://www.abd.org, retrieved October 19, 2009; and “Report for Selected

Countries and Subjects,” International Monetary Fund, found at http://www.imf.org, retrieved October 19, 2009.

 69 Energy Information Administration, India Energy profile, April 10, 2009, found at

http://tonto.eia.doe.gov/country/country_energy_data.cfm?fips=IN, retrieved May 1, 2009. 

 70 Petition, ***, Attachment I-22, p. 1-7.

 71 Energy Information Administration, Japan Energy Profile, April 10, 2009, found at

http://tonto.eia.doe.gov/country/country_energy_data.cfm?fips=Ja, retrieved May 1, 2009.

 72 Petition, ***, Attachment I-22.

 73 International Rotary Rig Count, Baker Hughes Incorporated, found at

http://investor.shareholder.com/bhi/rig_counts/rc_index.cfm, retrieved May 2, 2009.

 74 Oil Country Tubular Goods from Argentina, Italy, Japan, Korea, and Mexico, Investigation Nos. 731-TA-711

and 713-716 (Second Review), USITC Publication 3923, June 2007, pp. IV-15-16.

VII-18
seamless and welded API pipe (as well as other tubular products) has been estimated as approaching ***

short tons.75

Korea

Korea is Asia's fourth largest economy but has very little in the way of energy resources. It is the

world’s fifth-largest net importer of oil and must import all its oil needs. It is also the second-largest

importer of liquefied natural gas after Japan.76 Korea has no domestic crude oil production and no active

rotary rig. Therefore, essentially all Korean OCTG production is for export. According to a Korean trade

executive, Korea’s product quality is expected to rank between China at the low end and Japan at the high

end.77 Reportedly, Korean companies import hot-rolled coil from China for the production of the

commodity grade OCTG. For higher grades, Korean producers either use their own steel or import from

Japan.78

Overall, Korean OCTG production was estimated to be *** short tons in 2007, although its

capacity to produce welded API pipe (and other tubular products) was approximately *** short tons.79 In

terms of capacity, Hyundai Hysco is the largest OCTG producer in Korea, followed by SeAH Steel, and

Husteel. All are producers of welded pipe and tube.

Korean companies are active in the global steel tube and pipe industry. Posco, the world's

third-biggest steelmaker, and Metinvest, Ukraine's biggest iron ore miner and second-biggest steel

producer, are engaging in discussion for a wide range of joint projects including steel tube and pipe

production.80

Mexico

In 2008, Mexico was the world’s seventh-largest oil producer and the third largest in the Western

Hemisphere. Mexico is an important non-OPEC oil exporter. Petróleos Mexicanos (PEMEX), Mexico's

state-owned petroleum monopoly, is one of the largest oil companies in the world in terms of revenue.81

As of November 2009, Mexico has 123 active rotary rigs.82 Mexican rig count has been stable,

fluctuating between 112 and 130 during the last 5 years. As such, Mexico has a large domestic market for

OCTG. During 2006-08, Mexico’s total OCTG exports declined by over 134,000 tons (more than

29 percent) to 324,944 tons. The overwhelming majority of Mexico’s OCTG exports are seamless. 

 75 ***.

 76 Energy Information Administration, “Korea, South Energy profile,” Energy Information Administration, April

10, 2009, found at http://tonto.eia.doe.gov/country/country_energy_data.cfm?fips=KO, retrieved May 1, 2009.

 77 Staff telephone interview with an executive from ***, May 1, 2009.

 78 Staff telephone interview with an executive from ***, May 1, 2009.

 79 ***.

 80 “Seeking New Business Opportunities in Ukraine’s Steel Industry and Raw Materials,” POSCO News Release,

October 9, 2009, found at

http://www.posco.com/homepage/docs/eng/jsp/prcenter/news/s91c1010025v.jsp?idx=1150 retrieved October 28,

2009. “Posco and Metinvest Mull "Wide Range" of Joint Projects,” Metal Bulletin, October 7, 2009, found at

http://www.metalbulletin.com/Article/2311069/Posco-and-Metinvest-mull-quotwide-rangequot-of-joint-projects.htm

l retrieved October 27, 2009.

 81 Energy Information Administration, Mexico Energy Profile, April 10, 2009, found at

http://tonto.eia.doe.gov/country/country_energy_data.cfm?fips=MX, retrieved May 1, 2009. 

 82 International Rotary Rig Count, Baker Hughes Incorporated, found at

http://investor.shareholder.com/bhi/rig_counts/rc_index.cfm, retrieved May 2, 2009.

VII-19
Nearly a quarter of Mexico’s OCTG exports go to the United States. Other important export destinations

include Venezuela, Colombia, and the Middle East.

According to ***, Mexico produced *** tons of OCTG in 2007, a decrease of *** percent from

its 2006 production level (table VII-1). The large majority of Mexico’s OCTG production is seamless

casing and tubing. The largest of Mexico’s OCTG producers is Tenaris TAMSA (“TAMSA”), a whollyowned subsidiary of Tenaris.83 TAMSA is an integrated steel producer that can provide a wide range of

seamless tubular products including line pipe, casing and tubing, drill pipe, standard pipe, and pressure

tubes with 7 production lines and outside diameters ranging from 2.375 inches to 14 inches. Tenaris has

reportedly planned to add to its capacity in Mexico.84 Currently, installed seamless API pipe capacity in

Mexico is estimated to be *** short tons.85 In 2007, TAMSA stated that it was focusing on improving

quality of the product rather than expanding capacity. It also stressed that its main goal was to supply

OCTG to PEMEX, as it anticipated Maverick supplying the U.S. market.

Recent OCTG Operations in Select Nonsubject Countries

Staff requested that U.S. producers provide a statistical profile of their related OCTG operations

in nonsubject countries. These operations account for a substantial portion or even essentially all of the

OCTG production in several of the leading nonsubject countries supplying the United States with OCTG. 

Additional information concerning petitioners’ pipe capacity and production, and OCTG capacity,

production, and shipments are presented in table VII-13.

Table VII-13

OCTG: Selected foreign producers’ trade data, 2008, January-September/October 2008, and

January-September/October 2009

* * * * * * *

 83 Tenaris is a leading global supplier of steel tubes and related services for the world's energy industry and

certain other industrial applications. 

 84 Metal Bulletin Research, Seamless Steel Tube and Pipe Monthly, April 2009, p. 5.

 85 ***. Simdex reports that seamless capacity of TAMSA is 860,000 short tons. The Simdex Steel Tube

Manufacturers Worldwide Guide, Mexico, Tenaris TAMSA 2009.

VII-20
A-1

APPENDIX A

FEDERAL REGISTER NOTICES

Federal Register / Vol. 74, No. 110 / Wednesday, June 10, 2009 / Notices 27559 

1The record is defined in sec. 207.2(f) of the 

Commission’s Rules of Practice and Procedure (19 

CFR 207.2(f)). 

this proposal. Comments must be 

received within fourteen (14) days from 

the date of this Notice. Comments 

should refer to the proposal by name 

and/or OMB approval number and 

should be sent to: Ms. Kimberly P. 

Nelson, HUD Desk Officer, Office of 

Management and Budget, New 

Executive Office Building, Washington, 

DC 20502; e-mail: 

Kimberly_P._Nelson@omb.eop.gov; fax: 

(202) 395–6974. 

FOR FURTHER INFORMATION CONTACT: 

Lillian Deitzer, Reports Management 

Officer, QDAM, Department of Housing 

and Urban Development, 451 Seventh 

Street, SW., Washington, DC 20410; 

e-mail: Lillian.L.Deitzer@hud.gov; 

telephone (202) 402–8048. This is not a 

toll-free number. Copies of available 

documents should be submitted to OMB 

and may be obtained from Ms. Deitzer. 

SUPPLEMENTARY INFORMATION: This 

notice informs the public that the 

Department of Housing and Urban 

Development has submitted to OMB a 

request for approval of the Information 

collection described below. This notice 

is soliciting comments from members of 

the public and affecting agencies 

concerning the proposed collection of 

information to: (1) Evaluate whether the 

proposed collection of information is 

necessary for the proper performance of 

the functions of the agency, including 

whether the information will have 

practical utility; (2) Evaluate the 

accuracy of the agency’s estimate of the 

burden of the proposed collection of 

information; (3) Enhance the quality, 

utility, and clarity of the information to 

be collected; and (4) Minimize the 

burden of the collection of information 

on those who are to respond; including 

through the use of appropriate 

automated collection techniques or 

other forms of information technology, 

e.g., permitting electronic submission of 

responses. 

This notice also lists the following 

information: 

Title of Proposal: 2009 American 

Housing Survey—New Orleans 

Metropolitan Sample. 

Description of Information Collection: 

This is a new information collection. 

The Department of Housing and Urban 

Development is seeking emergency 

review of the Paperwork Reduction Act 

Requirements associated with the 2009 

American Housing Survey—New 

Orleans Metropolitan Sample. This 

document provides notice that this 

emergency request is necessary at this 

time because it is essential to provide a 

periodic measure of the size and 

composition of the housing inventory 

for the select New Orleans metropolitan 

area. In addition, the New Orleans 

sample will provide information about 

people who rebuilt or rehabilitated their 

homes as a result of Hurricane Katrina, 

or are still in the process of renovating 

their homes; people who were living in 

New Orleans pre-Katrina, but who have 

moved to a different address in the New 

Orleans metro; and property that existed 

pre-Katrina, but has not been restored or 

where a person is living in a trailer on 

a lot. Title 12, United States Code, 

Sections 1701Z–1, 1701Z–2(g), and 

1710Z–10a mandates the collection of 

this information. The 2009 American 

Housing Survey New Orleans 

Metropolitan sample is similar to 

previous American Housing Surveys 

(AHS) in that it collects data on subjects 

such as the amount and types of 

changes in the inventory, the physical 

condition of the inventory, the 

characteristics of the occupants, the 

persons eligible for and beneficiaries of 

assisted housing by race and ethnicity, 

and the number and characteristics of 

vacancies. Policy analysts, program 

managers, budget analysts, and 

Congressional staff use AHS data to 

advise executive and legislative 

branches about housing conditions and 

the suitability of public policy 

initiatives. Academic researchers and 

private organizations also use AHS data 

in efforts of specific interest and 

concern to their respective 

communities. The Department of 

Housing and Urban Development (HUD) 

needs the AHS data for two important 

uses. 

1. With the data, policy analysts can 

monitor the interaction among housing 

needs, demand and supply, as well as 

changes in housing conditions and 

costs, to aid in the development of 

housing policies and the design of 

housing programs appropriate for 

different target groups, such as first-time 

home buyers and the elderly. 

2. With the data, HUD can evaluate, 

monitor, and design HUD programs to 

improve efficiency and effectiveness. 

OMB Control Number: 2528–Pending. 

Agency Form Numbers: Computerized 

Versions of AHS–2161, AHS–22/62 and 

AHS–23/63. 

Members of the Affected Public: 

Households. 

Estimation of the total numbers of 

hours needed to prepare the information 

collection including number of 

responses, frequency of responses, and 

hours of responses: The number of 

respondents is 5,400 and the number of 

responses is 4,644. The estimated total 

number of burden hours needed to 

prepare the information collection is 

3,654; the frequency of response is once. 

Respondent’s Obligation: Voluntary. 

Authority: The Paperwork Reduction Act 

of 1995, 44 U.S.C. Chapter 35, as amended. 

Dated: June 3, 2009. 

Lillian Deitzer, 

Departmental Reports Management Officer, 

Office of the Chief Information Officer. 

[FR Doc. E9–13632 Filed 6–9–09; 8:45 am] 

BILLING CODE 4210–67–P 

INTERNATIONAL TRADE 

COMMISSION 

[Investigation Nos. 701–TA–463 and 731– 

TA–1159 (Preliminary)] 

Certain Oil Country Tubular Goods 

from China; Determinations 

On the basis of the record 1 developed 

in the subject investigations, the United 

States International Trade Commission 

(Commission) determines, pursuant to 

sections 703(a) and 733(a) of the Tariff 

Act of 1930 (19 U.S.C. 1671b(a) and 19 

U.S.C. 1673b(a)) (the Act), that there is 

a reasonable indication that an industry 

in the United States is materially 

injured by reason of imports from China 

of certain oil country tubular goods 

(OCTG) provided for in subheadings 

7304.29, 7305.20 and 7306.29 of the 

Harmonized Tariff Schedule of the 

United States. OCTG imported from 

China are alleged to be subsidized and 

sold in the United States at less than fair 

value (LTFV). 

Commencement of Final Phase 

Investigations 

Pursuant to section 207.18 of the 

Commission’s rules, the Commission 

also gives notice of the commencement 

of the final phase of its investigations. 

The Commission will issue a final phase 

notice of scheduling, which will be 

published in the Federal Register as 

provided in section 207.21 of the 

Commission’s rules, upon notice from 

the Department of Commerce 

(Commerce) of affirmative preliminary 

determinations in the investigations 

under sections 703(b) and 733(b) of the 

Act, or, if the preliminary 

determinations are negative, upon 

notice of affirmative final 

determinations in those investigations 

under sections 705(a) and 735(a) of the 

Act. Parties that filed entries of 

appearance in the preliminary phase of 

the investigations need not enter a 

separate appearance for the final phase 

of the investigations. Industrial users, 

and, if the merchandise under 

investigation is sold at the retail level, 

representative consumer organizations, 


erowe on PROD1PC63 with NOTICES
27560 Federal Register / Vol. 74, No. 110 / Wednesday, June 10, 2009 / Notices 

have the right to appear as parties in 

Commission antidumping and 

countervailing duty investigations. The 

Secretary will prepare a public service 

list containing the names and addresses 

of all persons, or their representatives, 

who are parties to the investigations. 

Background 

On April 8, 2009, a petition was filed 

with the Commission and Commerce by 

Maverick Tube Corporation, Houston, 

TX; United States Steel Corporation, 

Dallas, TX; V&M Star LP, Houston, TX; 

V&M Tubular Corporation of America, 

Houston, TX; TMK IPSCO, Camanche, 

IA; Evraz Rocky Mountain Steel, Pueblo, 

CO; Wheatland Tube Corp., Wheatland, 

PA; and the United Steel, Paper and 

Forestry, Rubber, Manufacturing, 

Energy, Allied Industrial and Service 

Workers International Union, AFL–CIO– 

CLC, Pittsburgh, PA. Accordingly, 

effective April 8, 2009, the Commission 

instituted countervailing duty 

investigation No. 701–TA–463 and 

antidumping duty investigations No. 

731–TA–1159 (Preliminary). 

Notice of the institution of the 

Commission’s investigations and of a 

public conference to be held in 

connection therewith was given by 

posting copies of the notice in the Office 

of the Secretary, U.S. International 

Trade Commission, Washington, DC, 

and by publishing the notice in the 

Federal Register of April 8, 2009 (74 FR 

16009). The conference was held in 

Washington, DC, on April 29, 2009, and 

all persons who requested the 

opportunity were permitted to appear in 

person or by counsel. 

The Commission transmitted its 

determinations in these investigations to 

the Secretary of Commerce on May 26, 

2009. The views of the Commission are 

contained in USITC Publication 4081 

(June 2009), entitled Certain Oil Country 

Tubular Goods from China: 

Investigation Nos. 701–TA–463 and 

731–TA–1156–1159 (Preliminary). 

William R. Bishop, 

Acting Secretary. 

[FR Doc. E9–13526 Filed 6–9–09; 8:45 am] 

BILLING CODE 7020–02–P 

DEPARTMENT OF JUSTICE 

United States Parole Commission 

Record of Vote of Meeting Closure; 

(Public Law 94–409) (5 U.S.C. Sec. 

552b) 

I, Edward F. Reilly, Jr., of the United 

States Parole Commission, was present 

at a meeting of said Commission, which 

started at approximately 11:30 a.m., on 

Thursday, May 14, 2009, at the U.S. 

Parole Commission, 5550 Friendship 

Boulevard, 4th Floor, Chevy Chase, 

Maryland 20815. The purpose of the 

meeting was to decide two petitions for 

reconsideration pursuant to 28 CFR 

Section 2.27. Four Commissioners were 

present, constituting a quorum when the 

vote to close the meeting was submitted. 

Public announcement further 

describing the subject matter of the 

meeting and certifications of General 

Counsel that this meeting may be closed 

by vote of the Commissioners present 

were submitted to the Commissioners 

prior to the conduct of any other 

business. Upon motion duly made, 

seconded, and carried, the following 

Commissioners voted that the meeting 

be closed: Edward F. Reilly, Jr., 

Cranston J. Mitchell, Isaac Fulwood, Jr. 

and Patricia K. Cushwa. 

In witness whereof, I make this official 

record of the vote taken to close this 

meeting and authorize this record to be 

made available to the public. 

Dated: May 14, 2009. 

Edward F. Reilly, Jr., 

Chairman, U.S. Parole Commission. 

[FR Doc. E9–13398 Filed 6–9–09; 8:45 am] 

BILLING CODE 4410–01–M 

DEPARTMENT OF JUSTICE 

United States Parole Commission 

Record of Vote of Meeting Closure; 

(Pub. L. 94–409) (5 U.S.C. Sec. 552b) 

I, Isaac Fulwood, Chairman of the 

United States Parole Commission, was 

present at a meeting of said 

Commission, which started at 

approximately 10 a.m., on Thursday, 

May 21, 2009 at the U.S. Parole 

Commission, 5550 Friendship 

Boulevard, 4th Floor, Chevy Chase, 

Maryland 20815. The purpose of the 

meeting was to approve or disapprove 

the appointment of a hearing examiner. 

Four Commissioners were present, 

constituting a quorum, when the vote to 

close the meeting was submitted. 

Public announcement further 

describing the subject matter of the 

meeting and certifications of General 

Counsel that this meeting may be closed 

by vote of the Commissioners present 

were submitted to the Commissioners 

prior to the conduct of any other 

business. Upon motion duly made, 

seconded, and carried, the following 

Commissioners voted that the meeting 

be closed: Isaac Fulwood, Cranston J. 

Mitchell, Edward F. Reilly, Jr., and 

Patricia Cushwa. 

In witness whereof, I make this official 

record of the vote taken to close this 

meeting and authorize this record to be 

made available to the public. 

Dated: June 1, 2009. 

Isaac Fulwood, 

Chairman, U.S. Parole Commission. 

[FR Doc. E9–13399 Filed 6–9–09; 8:45 am] 

BILLING CODE 4410–01–M 

DEPARTMENT OF LABOR 

Employment Standards Administration 

Proposed Extension of the Approval of 

Information Collection Requirements 

ACTION: Notice. 

SUMMARY: The Department of Labor, as 

part of its continuing effort to reduce 

paperwork and respondent burden, 

conducts a preclearance consultation 

program to provide the general public 

and Federal agencies with an 

opportunity to comment on proposed 

and/or continuing collections of 

information in accordance with the 

Paperwork Reduction Act of 1995 

(PRA95) [44 U.S.C. 3506(c)(2)(A)]. This 

program helps to ensure that requested 

data can be provided in the desired 

format, reporting burden (time and 

financial resources) is minimized, 

collection instruments are clearly 

understood, and the impact of collection 

requirements on respondents can be 

properly assessed. Currently, the 

Employment Standards Administration 

is soliciting comments concerning its 

proposal to extend the Office of 

Management and Budget (OMB) 

approval of the Information Collection: 

Secretary of Labor’s Opportunity Award, 

Exemplary Voluntary Effort (EVE) 

Award, and Exemplary Public Interest 

Contribution (EPIC) Award. A copy of 

the proposed information collection 

request can be obtained by contacting 

the office listed below in the ADDRESSES

section of this Notice. 

DATES: Written comments must be 

submitted to the office listed in the 

addresses section below on or before 

August 10, 2009. 

ADDRESSES: Mr. Steven D. Lawrence, 

U.S. Department of Labor, 200 

Constitution Ave., NW., Room S–3201, 

Washington, DC 20210, telephone (202) 

693–0292, fax (202) 693–1451, Email 

Lawrence.Steven@dol.gov. Please use 

only one method of transmission for 

comments (mail, fax, or Email). 

SUPPLEMENTARY INFORMATION: 

I. Background: The Office of Federal 

Contract Compliance Programs (OFCCP) 

is responsible for the administration of 

the Secretary of Labor’s Opportunity 

Award, Exemplary Voluntary Effort 


erowe on PROD1PC63 with NOTICES
50242 Federal Register / Vol. 74, No. 188 / Wednesday, September 30, 2009 / Notices 

11For purposes of these investigations, the 

Department of Commerce has defined the subject 

merchandise as ‘‘OCTG, which 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, regardless of end finish (e.g., whether or 

not plain end, threaded, or threaded and coupled) 

whether or not conforming to American Petroleum 

Institute (‘‘API’’) or non-API specifications, whether 

finished (including limited service OCTG products) 

or unfinished (including green tubes and limited 

service OCTG products), whether or not thread 

protectors are attached. The scope of the 

investigation also covers OCTG coupling stock. 

Excluded from the scope of the investigation are: 

casing or tubing containing 10.5 percent or more by 

weight of chromium; drill pipe; unattached 

couplings; and unattached thread protectors.’’ 

22Certain Oil Country Tubular Goods from the 

People’s Republic of China: Postponement of 

Preliminary Determination of Antidumping Duty 

Investigations, 74 FR 43098, August 26, 2009. 

Commerce is scheduled to make its preliminary 

determinations by November 4, 2009. 

present written or oral comments to the 

SRC. This meeting will be recorded and 

meeting minutes will be available upon 

request from the park superintendent for 

public inspection approximately six 

weeks after the meeting. The NPS SRC 

program is authorized under Title VIII, 

Section 808 of the Alaska National 

Interest Lands Conservation Act, Public 

Law 96–487, to operate in accordance 

with the provisions of the Federal 

Advisory Committee Act. 

FOR FURTHER INFORMATION ON THE ANIA

SRC MEETING CONTACT: Mary McBurney, 

Subsistence Manager, Tel. (907) 235– 

7891, Address: 240 W. 5th Avenue, 

Suite 236, Anchorage, AK 99501or 

Clarence Summers, Subsistence 

Manager, Tel. (907) 644–3603. 

ANIA SRC Meeting Date and 

Location: The ANIA SRC meeting will 

be held on Monday, October 26, 2009, 

from 11 a.m. to 3 p.m. at the Chignik 

Lake Subsistence Building in Chignik 

Lake, AK. The ANIA SRC meeting may 

end early if all business is completed. 

The proposed meeting agenda for 

each meeting includes the following: 

1. Call to order. 

2. SRC Roll Call and Confirmation of 

Quorum. 

3. SRC Chair and Superintendent’s 

Welcome and Introductions. 

4. Approval of Minutes. 

5. Review and Approve Agenda. 

6. SRC Purpose and Status of 

Membership. 

7. SRC Member Reports. 

8. Park Subsistence Manager’s Report. 

9. Subsistence Uses of Horns, Antlers, 

Bones and Plants EA Update. 

10. Federal Subsistence Board 

Update. 

11. Alaska Board of Game Update. 

12. Old Business. 

13. New Business. 

14. Public and other Agency 

Comments. 

15. Set Time and Place for next SRC 

Meeting. 

16. Adjournment. 

SUPPLEMENTARY INFORMATION: The ANIA 

SRC meeting location and date may 

need to be changed based on weather or 

local circumstances. If the meeting date 

and location are changed, a notice will 

be published in local newspapers and 

announced on local radio stations prior 

to the meeting date. 

Sue E. Masica, 

Regional Director, Alaska. 

[FR Doc. E9–23549 Filed 9–29–09; 8:45 am] 

BILLING CODE 4312–HE–P 

INTERNATIONAL TRADE 

COMMISSION 

[Investigation Nos. 701–TA–463 (Final) and 

731–TA–1159 (Final)] 

Certain Oil Country Tubular Goods 

From China 

AGENCY: United States International 

Trade Commission. 

ACTION: Scheduling of the final phase of 

countervailing duty and antidumping 

investigations. 

SUMMARY: The Commission hereby gives 

notice of the scheduling of the final 

phase of countervailing duty 

investigation No. 701–TA–463 (Final) 

under section 705(b) of the Tariff Act of 

1930 (19 U.S.C. 1671d(b)) (the Act) and 

the final phase of antidumping 

investigation No. 731–TA–1159 (Final) 

under section 735(b) of the Act (19 

U.S.C. 1673d(b)) to determine whether 

an industry in the United States is 

materially injured or threatened with 

material injury, or the establishment of 

an industry in the United States is 

materially retarded, by reason of 

subsidized and less-than-fair-value 

imports from China of certain oil 

country tubular goods, primarily 

provided for in subheadings 7304.29, 

7305.20 and 7306.29 of the Harmonized 

Tariff Schedule of the United States.11

For further information concerning 

the conduct of this phase of the 

investigations, hearing procedures, and 

rules of general application, consult the 

Commission’s Rules of Practice and 

Procedure, part 201, subparts A through 

E (19 CFR part 201), and part 207, 

subparts A and C (19 CFR part 207). 

DATES: Effective Date: September 15, 

2009. 

FOR FURTHER INFORMATION CONTACT: Fred 

Ruggles (202–205–3187 or 

fred.ruggles@usitc.gov), Office of 

Investigations, U.S. International Trade 

Commission, 500 E Street SW., 

Washington, DC 20436. Hearingimpaired persons can obtain 

information on this matter by contacting 

the Commission’s TDD terminal on 202– 

205–1810. Persons with mobility 

impairments who will need special 

assistance in gaining access to the 

Commission should contact the Office 

of the Secretary at 202–205–2000. 

General information concerning the 

Commission may also be obtained by 

accessing its Internet server (http:// 

www.usitc.gov). The public record for 

these investigations may be viewed on 

the Commission’s electronic docket 

(EDIS) at http://edis.usitc.gov. 

SUPPLEMENTARY INFORMATION: 

Background.—The final phase of 

these investigations is being scheduled 

as a result of affirmative preliminary 

determinations by the Department of 

Commerce that certain benefits which 

constitute subsidies within the meaning 

of section 703 of the Act (19 U.S.C. 

1671b) are being provided to 

manufacturers, producers, or exporters 

in China of certain oil country tubular 

goods, and that such products are being 

sold in the United States at less than fair 

value within the meaning of section 733 

of the Act (19 U.S.C. 1673b). The 

investigations were requested in a 

petition filed on April 8, 2009, by 

Maverick Tube Corporation, Houston, 

TX; United States Steel Corporation, 

Dallas, TX; V&M Star LP, Houston, TX; 

V&M Tubular Corporation of America, 

Houston, TX; TMK IPSCO, Camanche, 

IA; Evraz Rocky Mountain Steel, Pueblo, 

CO; Wheatland Tube Corp., Wheatland, 

PA; and the United Steel, Paper and 

Forestry, Rubber, Manufacturing, 

Energy, Allied Industrial and Service 

Workers International Union, AFL–CIO– 

CLC, Pittsburgh, PA. 

The Department of Commerce has 

postponed its preliminary 

determination as to whether imports of 

certain oil country tubular goods from 

China are being, or are likely to be sold, 

in the United States at less than fair 

value.22 For purposes of efficiency, the 

Commission is scheduling the final 

phase of the antidumping investigation 

concerning China so that it may proceed 

concurrently with the Commission’s 

countervailing duty investigation 

concerning China. 

Participation in the investigations and 

public service list.—Persons, including 

industrial users of the subject 

merchandise and, if the merchandise is 

sold at the retail level, representative 

consumer organizations, wishing to 

participate in the final phase of these 


CPrice-Sewell on DSKGBLS3C1PROD with NOTICES
Federal Register / Vol. 74, No. 188 / Wednesday, September 30, 2009 / Notices 50243 

investigations as parties must file an 

entry of appearance with the Secretary 

to the Commission, as provided in 

section 201.11 of the Commission’s 

rules, no later than 21 days prior to the 

hearing date specified in this notice. A 

party that filed a notice of appearance 

during the preliminary phase of the 

investigations need not file an 

additional notice of appearance during 

this final phase. The Secretary will 

maintain a public service list containing 

the names and addresses of all persons, 

or their representatives, who are parties 

to the investigations. 

Limited disclosure of business 

proprietary information (BPI) under an 

administrative protective order (APO) 

and BPI service list.—Pursuant to 

section 207.7(a) of the Commission’s 

rules, the Secretary will make BPI 

gathered in the final phase of these 

investigations available to authorized 

applicants under the APO issued in the 

investigations, provided that the 

application is made no later than 21 

days prior to the hearing date specified 

in this notice. Authorized applicants 

must represent interested parties, as 

defined by 19 U.S.C. 1677(9), who are 

parties to the investigations. A party 

granted access to BPI in the preliminary 

phase of the investigations need not 

reapply for such access. A separate 

service list will be maintained by the 

Secretary for those parties authorized to 

receive BPI under the APO. 

Staff report.—The prehearing staff 

report in the final phase of these 

investigations will be placed in the 

nonpublic record on November 16, 

2009, and a public version will be 

issued thereafter, pursuant to section 

207.22 of the Commission’s rules. 

Hearing.—The Commission will hold 

a hearing in connection with the final 

phase of these investigations beginning 

at 9:30 a.m. on December 1, 2009, at the 

U.S. International Trade Commission 

Building. Requests to appear at the 

hearing should be filed in writing with 

the Secretary to the Commission on or 

before November 25, 2009. A nonparty 

who has testimony that may aid the 

Commission’s deliberations may request 

permission to present a short statement 

at the hearing. All parties and 

nonparties desiring to appear at the 

hearing and make oral presentations 

should attend a prehearing conference 

to be held at 9:30 a.m. on November 30, 

2009, at the U.S. International Trade 

Commission Building. Oral testimony 

and written materials to be submitted at 

the public hearing are governed by 

sections 201.6(b)(2), 201.13(f), and 

207.24 of the Commission’s rules. 

Parties must submit any request to 

present a portion of their hearing 

testimony in camera no later than 7 

business days prior to the date of the 

hearing. 

Written submissions.—Each party 

who is an interested party shall submit 

a prehearing brief to the Commission. 

Prehearing briefs must conform with the 

provisions of section 207.23 of the 

Commission’s rules; the deadline for 

filing is November 23, 2009. Parties may 

also file written testimony in connection 

with their presentation at the hearing, as 

provided in section 207.24 of the 

Commission’s rules, and posthearing 

briefs, which must conform with the 

provisions of section 207.25 of the 

Commission’s rules. 

The deadline for filing posthearing 

briefs is December 8, 2009; witness 

testimony must be filed no later than 

three days before the hearing. In 

addition, any person who has not 

entered an appearance as a party to the 

investigations may submit a written 

statement of information pertinent to 

the subject of the investigations, 

including statements of support or 

opposition to the petition, on or before 

December 8, 2009. On December 23, 

2009, the Commission will make 

available to parties all information on 

which they have not had an opportunity 

to comment. Parties may submit final 

comments on this information on or 

before December 28, 2009, but such 

final comments must not contain new 

factual information and must otherwise 

comply with section 207.30 of the 

Commission’s rules. All written 

submissions must conform with the 

provisions of section 201.8 of the 

Commission’s rules; any submissions 

that contain BPI must also conform with 

the requirements of sections 201.6, 

207.3, and 207.7 of the Commission’s 

rules. The Commission’s rules do not 

authorize filing of submissions with the 

Secretary by facsimile or electronic 

means, except to the extent permitted by 

section 201.8 of the Commission’s rules, 

as amended, 67 Fed. Reg. 68036 

(November 8, 2002). Even where 

electronic filing of a document is 

permitted, certain documents must also 

be filed in paper form, as specified in II 

(C) of the Commission’s Handbook on 

Electronic Filing Procedures, 67 FR 

68168, 68173 (November 8, 2002). 

Additional written submissions to the 

Commission, including requests 

pursuant to section 201.12 of the 

Commission’s rules, shall not be 

accepted unless good cause is shown for 

accepting such submissions, or unless 

the submission is pursuant to a specific 

request by a Commissioner or 

Commission staff. 

In accordance with sections 201.16(c) 

and 207.3 of the Commission’s rules, 

each document filed by a party to the 

investigations must be served on all 

other parties to the investigations (as 

identified by either the public or BPI 

service list), and a certificate of service 

must be timely filed. The Secretary will 

not accept a document for filing without 

a certificate of service. 

Authority: These investigations are being 

conducted under authority of title VII of the 

Tariff Act of 1930; this notice is published 

pursuant to section 207.21 of the 

Commission’s rules. 

Issued: September 25, 2009. 

By order of the Commission. 

Marilyn R. Abbott, 

Secretary to the Commission. 

[FR Doc. E9–23562 Filed 9–29–09; 8:45 am] 

BILLING CODE 7020–02–P 

INTERNATIONAL TRADE 

COMMISSION 

[Investigation Nos. 701–TA–470–471 and 

731–TA–1169–1170 (Preliminary)] 

Certain Coated Paper Suitable for 

High-Quality Print Graphics Using 

Sheet-Fed Presses From China and 

Indonesia 

AGENCY: United States International 

Trade Commission. 

ACTION: Institution of antidumping and 

countervailing duty investigations and 

scheduling of preliminary phase 

investigations. 

SUMMARY: The Commission hereby gives 

notice of the institution of investigations 

and commencement of preliminary 

phase antidumping and countervailing 

duty investigations Nos. 701–TA–470– 

471 and 731–TA–1169–1170 

(Preliminary) under sections 703(a) and 

733(a) of the Tariff Act of 1930 (19 

U.S.C. 1671b(a) and 1673b(a)) (the Act) 

to determine whether there is a 

reasonable indication that an industry 

in the United States is materially 

injured or threatened with material 

injury, or the establishment of an 

industry in the United States is 

materially retarded, by reason of 

imports from China and Indonesia of 

certain coated paper suitable for highquality print graphics using sheet-fed 

presses, provided for in subheadings 

4810.13.11, 4810.13.19, 4810.13.20, 

4810.13.50, 4810.13.60, 4810.13.70, 

4810.14.11, 4810.14.19, 4810.14.20, 

4810.14.50, 4810.14.60, 4810.14.70, 

4810.19.11, 4810.19.19, 4810.19.20, 

4810.22.10, 4810.22.50, 4810.22.60, 

4810.22.70, 4810.29.10, 4810.29.50, 

4810.29.60, and 4810.29.70 of the 

Harmonized Tariff Schedule of the 

United States, that are alleged to be sold


CPrice-Sewell on DSKGBLS3C1PROD with NOTICES
Federal Register / Vol. 74, No. 220 / Tuesday, November 17, 2009 / Notices 59117 

LIST OF PETITIONS RECEIVED BY EDA FOR CERTIFICATION OF ELIGIBILITY TO APPLY FOR TRADE ADJUSTMENT— 

Continued 

[9/8/2009 through 11/6/2009] 

Firm Address Date accepted 

for filing Products 

Any party having a substantial 

interest in these proceedings may 

request a public hearing on the matter. 

A written request for a hearing must be 

submitted to the Office of Performance 

Evaluation, Room 7009, Economic 

Development Administration, U.S. 

Department of Commerce, Washington, 

DC 20230, no later than ten (10) 

calendar days following publication of 

this notice. Please follow the procedures 

set forth in Section 315.9 of EDA’s final 

rule (71 FR 56704) for procedures for 

requesting a public hearing. The Catalog 

of Federal Domestic Assistance official 

program number and title of the 

program under which these petitions are 

submitted is 11.313, Trade Adjustment 

Assistance. 

Dated: November 10, 2009. 

Bryan Borlik, 

Program Director, TAA for Firms. 

[FR Doc. E9–27522 Filed 11–16–09; 8:45 am] 

BILLING CODE 3510–24–P 

DEPARTMENT OF COMMERCE 

International Trade Administration 

[A–570–943] 

Certain Oil Country Tubular Goods 

From the People’s Republic of China: 

Notice of Preliminary Determination of 

Sales at Less Than Fair Value, 

Affirmative Preliminary Determination 

of Critical Circumstances and 

Postponement of Final Determination 

AGENCY: Import Administration, 

International Trade Administration, 

Department of Commerce. 

DATES: Effective Date: November 17, 

2009. 

SUMMARY: The Department of Commerce 

(‘‘Department’’) preliminarily 

determines that certain oil country 

tubular goods (‘‘OCTG’’) from the 

People’s Republic of China (‘‘PRC’’) are 

being, or are likely to be, sold in the 

United States at less than fair value 

(‘‘LTFV’’), as provided in section 733 of 

the Tariff Act of 1930, as amended (‘‘the 

Act’’). The estimated margins of sales at 

LTFV are shown in the ‘‘Preliminary 

Determination’’ section of this notice. 

Pursuant to requests from interested 

parties, we are postponing the final 

determination and extending the 

provisional measures from a four-month 

period to not more than six months. 

Accordingly, we will make our final 

determination not later than 135 days 

after publication of the preliminary 

determination. 

FOR FURTHER INFORMATION CONTACT: Paul 

Stolz or Eugene Degnan, AD/CVD 

Operations, Office 8, Import 

Administration, International Trade 

Administration, U.S. Department of 

Commerce, 14th Street and Constitution 

Avenue, NW., Washington, DC 20230; 

telephone: (202) 482–4474 or 482–0414, 

respectively. 

SUPPLEMENTARY INFORMATION: 

Initiation 

On April 8, 2009, Maverick Tube 

Corporation, United States Steel 

Corporation, TMK IPSCO, V&M Star 

L.P., V&M Tubular Corporation of 

America, Wheatland Tube Corp., Evraz 

Rocky Mountain Steel, and United 

Steel, Paper and Forestry, Rubber, 

Manufacturing, Energy, Allied 

Industrial and Service Workers 

International Union, AFL–CIO–CLC 

(collectively, ‘‘Petitioners’’), filed a 

petition in proper form on behalf of the 

domestic industry and workers 

mstockstill on DSKH9S0YB1PROD with NOTICES

59118 Federal Register / Vol. 74, No. 220 / Tuesday, November 17, 2009 / Notices 

1See Petition for the Imposition of Antidumping 

and Countervailing Duties Pursuant to Sections 701 

and 731 of the Tariff Act of 1930, as Amended, filed 

on April 8, 2009. 

2See Oil Country Tubular Goods From the 

People’s Republic of China: Initiation of 

Antidumping Duty Investigation, 74 FR 20671 

(May 5, 2009) (‘‘Initiation Notice’’). 

3See Certain Oil Country Tubular Goods From 

China, 74 FR 27559 (June 10, 2009); see also Certain 

Oil Country Tubular Goods From China: 

Investigation Nos. 701–TA–463 and 731–TA1159 

(Preliminary) USITC Publication 4081 (June 2009). 

4See 19 CFR 351.204(b)(1). 

5See Certain Oil Country Tubular Goods From 

the People’s Republic of China: Simultaneous 

Application of the Department’s Current NonMarket Economy Antidumping Methodology and 

Countervailing Duty Law to China (October 29, 

2009). 

6See Initiation Notice, 74 FR at 20676. 

7See Petition at Vol 1., Exhibit I–6. 

8See July 1, 2009, Memorandum to Wendy J. 

Frankel, Director, Office 8, from Eugene Degnan, 

Acting Program Manager, Office 8, regarding 

Selection of Respondents for the Antidumping 

Investigation of Certain Oil Country Tubular Goods 

From the People’s Republic of China (‘‘Respondent 

Selection Memo’’). 

producing OCTG, concerning imports of 

OCTG from the PRC (‘‘Petition’’).1 The 

Department initiated this investigation 

on April 28, 2009.2

On June 10, 2009, the United States 

International Trade Commission (‘‘ITC’’) 

issued its affirmative preliminary 

determination that there is a reasonable 

indication that an industry in the 

United States is materially injured by 

reason of imports from the PRC of 

OCTG. The ITC’s determination was 

published in the Federal Register on 

June 10, 2009.3

Scope Comments 

In accordance with the preamble to 

our regulations, we set aside a period of 

time for parties to raise issues regarding 

product coverage and encouraged all 

parties to submit comments within 20 

calendar days of publication of the 

Initiation Notice. See Antidumping 

Duties; Countervailing Duties; Final 

Rule, 62 FR 27296 27323 (May 19, 

1997); see also Initiation Notice, 72 FR 

at 20672. We received no comments 

from interested parties on issues related 

to the scope. 

Period of Investigation 

The period of investigation (‘‘POI’’) is 

October 1, 2008 through March 31, 

2009. This period corresponds to the 

two most recent fiscal quarters prior to 

the month of the filing of the petition 

(April 2009).4

Comment From Government of China 

On October 29, 2009, the Government 

of the PRC filed a submission to the 

Department alleging that the 

Department cannot lawfully apply its 

non-market economy (‘‘NME’’) 

antidumping methodology to the PRC in 

the less than fair value investigation of 

OCTG, while simultaneously applying 

the countervailing duty (‘‘CVD’’) law to 

the PRC in the parallel CVD OCTG 

investigation.5

The Department disagrees with this 

claim that application of the NME 

provisions of the Act concurrently with 

application of the countervailing duty 

provisions of the Act is precluded by 

any provision of law. Accordingly, the 

Department preliminarily determines to 

continue to follow its practice in several 

recent less than fair value investigations 

of merchandise from China by applying 

the NME provisions of the Act in 

accordance with the terms of those 

provisions, while concurrently 

conducting the countervailing duty 

investigation of the same merchandise 

in accordance with the relevant terms of 

the Act. Additionally, we note that the 

GOC assertion relies on GPX 

International Tire Corp. v United States, 

Slip Op. 2009–103 (CIT 2009), which is 

not a final judgment of the Court. 

Respondent Selection 

In the Initiation Notice, the 

Department stated that it intended to 

select respondents based on quantity 

and value (‘‘Q&V’’) questionnaires.6 On 

April 30, 2009 and May 7, 2009, the 

Department requested Q&V information 

from the 212 companies that Petitioners 

identified as potential exporters or 

producers of OCTG from the PRC.7

Additionally, the Department posted the 

Q&V questionnaire for this investigation 

on its Web site at http://www.trade.gov/ 

ia. 

The Department received timely Q&V 

responses from 43 exporters that 

shipped merchandise under 

investigation to the United States during 

the POI, and from four companies who 

stated that they had no shipments of 

merchandise under investigation to the 

United States during the POI. On July 1, 

2009, the Department selected Jiangsu 

Changbao Steel Tube Co., Ltd. 

(‘‘Changbao’’) and Tianjin Pipe 

International Economic and Trading 

Corporation (‘‘TPCO’’) as mandatory 

respondents in this investigation.8 The 

Department sent its antidumping duty 

questionnaire to Changbao and TPCO on 

July 1, 2009. 

Postponement of Final Determination 

and Extension of Provisional Measures 

Pursuant to section 735(a)(2) of the 

Act, on November 3, 2009, and 

November 4, 2009, respectively, 

Changbao and TPCO requested that in 

the event of an affirmative preliminary 

determination in this investigation, the 

Department postpone the final 

determination by 60 days. Changbao 

and TPCO also each requested that the 

Department extend the application of 

the provisional measures prescribed 

under 19 CFR 351.210(e)(2) from a fourmonth period to a six-month period. In 

accordance with section 733(d) of the 

Act and 19 CFR 351.210(b), because 

(1) our preliminary determination is 

affirmative, (2) the requesting exporters 

account for a significant proportion of 

exports of the subject merchandise, and 

(3) no compelling reasons for denial 

exist, we are granting the requests and 

are postponing the final determination 

until no later than 135 days after the 

publication of this notice in the Federal 

Register. Suspension of liquidation will 

be extended accordingly. 

Targeted Dumping Allegation 

On September 21, 2009, Petitioners 

requested that the Department extend 

the deadline for the submission of 

targeted dumping allegations to 

October 16, 2009, stating that they 

required additional time to analyze data 

because TPCO had just recently 

submitted an almost entirely new U.S. 

sales database, and Petitioners believed 

significant questions remained 

regarding whether Changbao had 

reported the full universe of its U.S. 

sales. The Department granted 

Petitioners’ request, and on October 16, 

2009, Petitioners filed allegations of 

targeted dumping which were based on 

the p/2 targeted dumping methodology 

used in the less than fair value 

investigation of coated free sheet paper 

from the Republic of Korea. See Notice 

of Final Determination of Sales at Less 

Than Fair Value: Coated Free Sheet 

Paper From the Republic of Korea, 72 

FR 60630 (October 25, 2007). However, 

the current targeted dumping 

methodology used by the Department is 

the methodology employed in Certain 

Steel Nails From the United Arab 

Emirates: Notice of Final Determination 

of Sales at Not Less Than Fair Value, 73 

FR 33985 (June 16, 2008) (‘‘Nails’’). 

Given the timing of the allegations, 

the Department was unable to address 

the targeted dumping allegations for this 

preliminary determination. The 

Department will request that the 

Petitioner file additional information, in 

conformance with the methodology 

used in Nails, after the preliminary 

determination. We intend to then issue 

a preliminary finding regarding these 

allegations, after the preliminary 

determination but with sufficient time 

to allow all parties time to comment 

before the final determination. 

mstockstill on DSKH9S0YB1PROD with NOTICES

Federal Register / Vol. 74, No. 220 / Tuesday, November 17, 2009 / Notices 59119 

9See Letter from TPCO, ‘‘TPCO’s Submission of 

Monthly Shipment Information: Certain Oil 

Country Tubular Goods (OCTG) from China,’’ dated 

October 2, 2009, (TPCO’s Monthly Shipment Data) 

at Attachment I. See also Letter from Changbao, 

‘‘Antidumping Duty Investigation: Certain Oil 

Country Tubular Goods from the People’s Republic 

of China (A–570–943)—Critical Circumstances 

Questionnaire Response,’’ dated October 2, 2009, 

(Changbao’s Monthly Shipment Data) at 3. 

10See 19 CFR 351.206(i). 

11See Volume IV of the petition at 3–8. 

12See Volume IV of the petition at 4 and page 15 

of Exhibit V, which states, in relevant part: ‘‘Those 

who believe that OCTG prices could spike also 

argue that a trade case could soon be filed against 

Chinese OCTG producers. But that case may be 

hard to argue with imports in general declining and 

mills reporting strong profits.’’ 

13http://www.cbsa-asfc.gc.ca/sima-lmsi/mif-meveng.html#SeamlessCasing 

14See Volume IV of the Petition (‘‘Critical 

Circumstances Allegation’’) at 3–7 and Exhibits IV– 

1 through IV–7. 

15See Critical Circumstances Allegation at 6–7 

and Exhibit IV–8. 

16See, e.g., Notice of Final Antidumping Duty 

Determination of Sales at Less Than Fair Value and 

Affirmative Critical Circumstances: Certain Frozen 

Fish Fillets from the Socialist Republic of Vietnam, 

68 FR 37116 (June 23, 2003), and accompanying 

Issues and Decision Memorandum at Comment 7 

(finding reason to believe a case was likely based 

upon widely disseminated newspaper articles 

stating: ‘‘America’s catfish industry, stung by 

dropping prices triggered by a flood of cheaper fish 

from Vietnam, is gearing up for a possible 

antidumping campaign’’ and ‘‘Vietnamese seafood 

exporters are entering a new war on the U.S. 

market, as American rivals are lobbying on an antidumping taxation’’); and Notice of Final 

Determination of Sales at Less Than Fair Value: 

Carbon and Certain Alloy Steel Wire Rod From 

Germany, 67 FR 55802 (August 30, 2002), and 

accompanying Issues and Decision Memorandum at 

Comment 6 (finding reason to believe a case was 

likely based upon trade publication which ‘‘alerted 

steel wire rod importers, exporters, and producers 

the proceedings concerning the subject 

merchandise were likely in a number of countries’’). 

17See Volume IV of the petition at Exhibit IV–8. 

18See, e.g., Notice of Final Determination of Sales 

at Less Than Fair Value: Certain Frozen and 

Canned Warmwater Shrimp From the People’s 

Republic of China, 69 FR 70997 (December 8, 2004) 

at Comment &A. See also Notice of Preliminary 

Determination of Sales at Less Than Fair Value, 

Affirmative Preliminary Determination of Critical 

Circumstances and Postponement of Final 

Determination: Certain Frozen Fish Fillets From the 

Socialist Republic of Vietnam, 68 FR 4986 (January 

31, 2003), unchanged in the final determination, 

Notice of Final Antidumping Duty Determination of 

Sales at Less Than Fair Value and Affirmative 

Critical Circumstances: Certain Frozen Fish Fillets 

Continued 

Critical Circumstances 

On April 8, 2009, Petitioners alleged 

that there is a reasonable basis to believe 

or suspect critical circumstances exist 

with respect to the antidumping 

investigation of OCTG from the PRC. On 

October 2, 2009, TPCO and Changbao 

submitted information on their exports 

of OCTG from November 2008 through 

August 2009, as requested by the 

Department.9 In accordance with 19 

CFR 351.206(c)(2)(i), because Petitioners 

submitted critical circumstances 

allegations more than 20 days before the 

scheduled date of the preliminary 

determination, the Department must 

issue preliminary critical circumstances 

determinations not later than the date of 

the preliminary determination. 

Section 733(e)(1) of the Act provides 

that the Department will preliminarily 

determine that critical circumstances 

exist if there is a reasonable basis to 

believe or suspect that: (A)(i) There is a 

history of dumping and material injury 

by reason of dumped imports in the 

United States or elsewhere of the subject 

merchandise; or (ii) the person by 

whom, or for whose account, the 

merchandise was imported knew or 

should have known that the exporter 

was selling the subject merchandise at 

less than its fair value and that there 

was likely to be material injury by 

reason of such sales; and (B) there have 

been massive imports of the subject 

merchandise over a relatively short 

period. Section 351.206(h)(1) of the 

Department’s regulations provides that, 

in determining whether imports of the 

subject merchandise have been 

‘‘massive,’’ the Department normally 

will examine: (i) The volume and value 

of the imports; (ii) seasonal trends; and 

(iii) the share of domestic consumption 

accounted for by the imports. In 

addition, section 351.206(h)(2) of the 

Department’s regulations provides that 

an increase in imports of 15 percent 

during the ‘‘relatively short period’’ of 

time may be considered ‘‘massive.’’ 

Section 351.206(i) of the Department’s 

regulations defines ‘‘relatively short 

period’’ as normally being the period 

beginning on the date the proceeding 

begins (i.e., the date the petition is filed) 

and ending at least three months later 

(i.e., the comparison period). The 

comparison period is normally 

compared to a corresponding period 

prior to the filing of the petition (i.e., the 

base period). The regulations also 

provide, however, that if the 

Department finds that importers, 

exporters, or producers had reason to 

believe, at some time prior to the 

beginning of the proceeding, that a 

proceeding was likely, the Department 

may establish the base and comparison 

periods based on the earlier date.10 In 

their critical circumstances allegation, 

the petitioners allege that exporters and 

producers had reason to believe a 

proceeding covering OCTG from the 

PRC would likely be instituted as of July 

2008.11 Consequently, the petitioners 

request that the Department use January 

through June 2008 as the base period 

and July through December 2008 as the 

comparison period. 

In this allegation, the petitioners 

assert that producers and exporters had 

reason to believe a proceeding was 

likely well in advance to the ultimate 

filing of the petition based on the 

following events: An October 2007 

conference presentation alluding to a 

possible ‘‘trade case;’’ 12 the 

Department’s November 2007 CVD 

determinations covering carbon quality 

steel pipe and light-walled rectangular 

pipe and tube; Canada’s March 2008 

imposition of antidumping (‘‘AD’’) and 

CVD on ‘‘seamless carbon or alloy steel 

oil and gas well casings;’’ 13 a March 

2008 statement from a PRC distributor 

of OCTG that ‘‘only the issuing of antidumping duties will be able to cut 

imports from China;’’ the Department’s 

initiation of AD and CVD proceedings 

on certain circular welded carbon 

quality steel line pipe from the Republic 

of Korea and the PRC; the May and June 

affirmative findings by the ITC and the 

Department regarding the abovementioned pipe cases; a June 2008 

Associated Press article which states 

that the other pipe rulings ‘‘could be the 

first of a wave of victories by U.S. 

companies battling Chinese imports;’’ 

and, in July 2008, the European Union 

(‘‘EU’’) initiated AD investigations of 

seamless tubular products from the 

PRC.14 The petitioners allege that these 

events culminated in the July 21, 2008, 

warning by Hou Yin of China Iron & 

Steel Association that ‘‘the U.S. may 

start an anti-dumping investigation on 

Chinese seamless pipes soon.’’ 15

Although the Department has found 

producers and exporters had reason to 

believe that a proceeding was likely 

prior to a petition being filed in prior 

cases,16 the evidence put forth by the 

petitioners in this case does not indicate 

that producers and exporters here had 

reason to believe that a proceeding was 

likely as of July 2008. The petitioners 

point to a litany of events dating back 

to October 2007 to indicate that the 

industry was on notice of a potential 

case. The petitioners point primarily to 

a reported statement by a representative 

of the China Iron & Steel Association 

that ‘‘the U.S. may start an antidumping investigation on Chinese 

seamless pipes soon, following the 

EU.’’ 17 This statement, taken in the 

context of the other events cited by the 

petitioners, is not enough to 

demonstrate that producers, exporters, 

and importers of OCTG from the PRC 

had, or should have had, reason to 

believe the filing of a petition was likely 

as of July 2008. The events cited by the 

petitioners, unlike the events the 

Department has relied on in similar 

cases,18 are speculative and do not refer 

mstockstill on DSKH9S0YB1PROD with NOTICES

59120 Federal Register / Vol. 74, No. 220 / Tuesday, November 17, 2009 / Notices 

from the Socialist Republic of Vietnam, 68 FR 

37116 (June 23, 2003). 

19See TPCO’s Monthly Shipment Data and 

Changbao’s Monthly Shipment Data. 

20See Volume IV of the April 8, 2008 Petition at 

9 and Exhibit IV–3 at 6. 

21See, e.g., Carbon and Alloy Steel Wire Rod 

From Germany, Mexico, Moldova, Trinidad and 

Tobago, and Ukraine: Notice of Preliminary 

Determination of Critical Circumstances, 67 FR 

6224, 6225 (February 11, 2002). 

22See Memorandum to the File, ‘‘Antidumping 

Investigation of Certain Oil Country Tubular Goods 

from the People’s Republic of China, Critical 

Circumstances Data and Calculations for the 

Preliminary Determination,’’ dated January 24, 2008 

(‘‘Critical Circumstances Calculation 

Memorandum’’), at Attachments II and III. 

23See, e.g., Preliminary Determination of Sales at 

Less Than Fair Value and Partial Affirmative 

Determination of Critical Circumstances: Certain 

Polyester Staple Fiber from the People’s Republic of 

China, 71 FR 77373, 77377 (December 26, 2006) 

(‘‘PSF’’), unchanged in Final Determination of Sales 

at Less Than Fair Value and Partial Affirmative 

Determination of Critical Circumstances: Certain 

Polyester Staple Fiber from the People’s Republic of 

China, 72 FR 19690 (April 19, 2007), see also the 

‘‘Separate Rates’’ section. 

24 Id. 

25See, e.g., Lemon Juice from Argentina: 

Preliminary Determination of Sales at Less than 

Fair Value and Affirmative Preliminary 

Determination of Critical Circumstances, 72 FR 

20820, 20828 (April 26, 2007). 

26See Investigation Nos. 701–TA–463 and 731– 

TA–1159 (Preliminary), Certain Oil Country 

Tubular Goods from China; Determinations, 74 FR 

27559, June 10, 2009 (‘‘ITC Preliminary 

Determination’’). 

27See section 733(e)(1)(B) of the Act. 

28See Notice of Preliminary Determination of 

Sales at Less Than Fair Value, Postponement of 

Final Determination, and Affirmative Preliminary 

Determination of Critical Circumstances: Certain 

Frozen and Canned Warmwater Shrimp from India, 

69 FR 47111 (August 4, 2004) unchanged in the 

final determination, (Notice of Final Determination 

of Sales at Less Than Fair Value and Negative Final 

Determination of Critical Circumstances: Certain 

Frozen and Canned Warmwater Shrimp From India, 

69 FR 76916 (December 23, 2004)); and Notice of 

Final Determination of Sales at Less Than Fair 

Value and Negative Final Determination of Critical 

Circumstances: Certain Color Television Receivers 

From the People’s Republic of China, 69 FR 20594 

(Apr. 16, 2004), and accompanying Issues and 

Decision Memorandum at Comment 3. 

specifically to subject merchandise. 

Therefore, we find that the petitioners 

have not demonstrated that importers, 

exporters, or producers, had reason to 

believe, at some time prior to the 

beginning of the proceeding that a 

proceeding covering OCTG from the 

PRC was likely. 

In further determining whether the 

above statutory criteria have been 

satisfied, we examined: (1) The 

evidence presented in Petitioners’ April 

8, 2009, petition and (2) additional 

information obtained from TPCO and 

Changbao.19

In accordance with section 

733(e)(1)(A)(i) of the Act, to determine 

whether there is a history of dumping 

and material injury by reason of 

dumped imports in the United States or 

elsewhere of the subject merchandise, 

the Department generally considers 

current or previous antidumping duty 

orders on subject merchandise from the 

country in question in the United States 

and current orders in any other country 

with regard to imports of subject 

merchandise. Petitioners noted that 

Canada placed an antidumping duty 

order on seamless carbon or alloy steel 

oil and gas well casings effective March 

10, 2008.20 We have reviewed this order 

and found that the product coverage 

overlaps the product coverage of the 

Department’s AD investigation of OCTG 

from the PRC. We are not aware of the 

existence of any additional antidumping 

orders on OCTG from the PRC, whether 

in the United States or other countries. 

However, as a result of the Canadian 

order cited above, the Department finds 

there is a history of injurious dumping 

of OCTG from the PRC pursuant to 

section 733(e)(1)(A)(i) of the Act. 

In accordance with Section 

733(e)(1)(A)(ii) of the Act, to determine 

whether importers of OCTG from the 

PRC knew or should have known that 

the exporter was selling the subject 

merchandise at less than its fair value 

and that there was likely to be material 

injury by reason of such sales, the 

Department must rely on the facts before 

it at the time the determination is made. 

The Department generally bases its 

decision with respect to knowledge on 

the margins calculated in the 

preliminary antidumping duty 

determination and the ITC preliminary 

injury determination. 

The Department normally considers 

margins of 25 percent or more for export 

price (‘‘EP’’) sales and 15 percent or 

more for constructed export price 

(‘‘CEP’’) sales sufficient to impute 

importer knowledge of sales at LTFV.21

In this preliminary determination, 

TPCO has a margin of 34.86 percent for 

CEP sales and 58.01 percent for EP 

sales. Changbao has a margin of zero 

percent for its sales, all of which were 

EP transactions.22 Consistent with 

Department practice, we base the 

margin for the separate-rate respondents 

on the average of the margins calculated 

for the mandatory respondents, 

excluding any rates that are zero, de 

minimis, or based entirely on AFA.23

Accordingly, because Changbao’s 

preliminary margin was zero, we have 

preliminarily applied to the separaterate companies a margin of 36.53 

percent, based on TPCO’s margin. The 

PRC Entity has a margin of 99.14 

percent.24 We find that the preliminary 

antidumping duty margin for Changbao 

is not sufficient to impute knowledge to 

its importers of sales at LTFV of OCTG 

from the PRC. However, we find that the 

preliminary margins for TPCO, the 

separate-rate companies and the PRCentity are sufficient to impute such 

knowledge. 

In determining whether there is a 

reasonable basis to believe or suspect 

that an importer knew or should have 

known that there was likely to be 

material injury by reason of dumped 

imports, consistent with section 

733(e)(1)(A)(ii) of the Act, the 

Department normally will look to the 

preliminary injury determination of the 

ITC.25 On June 10, 2009, the ITC issued 

its preliminary affirmative 

determination for OCTG from the 

PRC.26 Accordingly, based on the above 

analysis, the Department finds that there 

is a reasonable basis to believe or 

suspect that the importers knew or 

should have known that there was likely 

to be material injury by reason of sales 

at LTFV of OCTG from the PRC from 

TPCO, the separate-rate companies, and 

the PRC entity. 

In accordance with section 

733(e)(1)(B) of the Act, the Department 

must determine whether there have 

been massive imports of the subject 

merchandise over a relatively short 

period. Pursuant to 19 CFR 351.206(h), 

we will not consider imports to be 

massive unless imports in the 

comparison period have increased by at 

least 15 percent over imports in the base 

period. As discussed above, the 

Department normally determines the 

comparison period for massive imports 

based on the filing date of the petition. 

Based on the April 8, 2009 filing date, 

we have determined that April 2009 is 

the month in which importers, exporters 

or producers knew or should have 

known an antidumping duty 

investigation was likely. Additionally, 

we have used a period of five months 

as the period for comparison in 

preliminarily determining whether 

imports of the subject merchandise have 

been massive. We believe that a fivemonth period is most appropriate as the 

basis for analysis because using five 

months captures all data available at 

this time, based on April 2007 as the 

beginning of the comparison period. 

Additionally, a five-month period 

properly reflects the ‘‘relatively short 

period’’ set forth in the statute for 

determining whether imports have been 

massive.27 It is our practice to base the 

critical circumstances analysis on all 

available data, using base and 

comparison periods of no less than three 

months.28

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29See Critical Circumstances Calculation 

Memorandum at Attachment I. 

30See Critical Circumstances Calculation 

Memorandum at Attachment I. 

31See Notice of Final Determination of Sales at 

Less Than Fair Value: Stainless Steel Sheet and 

Strip in coils from Japan, Part II, 64 FR 30574, 

30585 (June 8, 1999). 

32See Statement of Administrative Action 

(‘‘SAA’’) accompanying the Uruguay Round 

Agreements Act, H. Doc. No. 316, 103d Cong., 2d 

Session, Vol. 1 (1994) at 870. 

Therefore, we have used all available 

data in our critical-circumstances 

analysis for the preliminary 

determination. In applying the fivemonth period, we used a base period of 

November 2008 through March 2009, 

and a comparison period of April 2009 

through August 2009. 

Mandatory Respondents 

The Department used the shipment 

data of TPCO and Changbao to examine 

the relevant base and comparison 

periods as identified above. When we 

compared these companies’ import data 

during the comparison period with the 

base period, we found that imports fell 

during the comparison period over the 

base period.29 Therefore, because 

imports in the comparison period have 

not increased by at least 15 percent over 

imports in the base period, we do not 

consider them to be massive pursuant to 

section 351.206(h) of the Department’s 

regulations. 

Separate-Rate Applicants 

For the separate-rate applicants, we 

did not request the monthly shipment 

information necessary to determine if 

there were massive imports. As the basis 

to measure whether massive imports 

existed for purposes of critical 

circumstances, we relied on the 

experience of the mandatory 

respondents receiving a separate rate. 

When we compared the weightedaverage import data during the 

comparison period with the weighted 

average import data during the base 

period for the mandatory respondents, 

we found that the weighted-average 

volume of imports of OCTG in the 

comparison period did not have an 

increased volume of exports over the 

base period of greater than 15 percent.30

In applying this result to the separate 

rate applicants, we do not find the 

imports of the separate-rate applicants 

to be massive pursuant to section 

351.206(h) of the Department’s 

regulations. 

The PRC Entity 

Because the PRC entity did not 

respond to our Q&V questionnaire, we 

were unable to obtain shipment data 

from the PRC entity for purposes of our 

critical-circumstances analysis and 

there is, therefore, no verifiable 

information on the record with respect 

to its export volumes. Section 776(a)(2) 

of the Act provides that: 

If an interested party or any other 

person (A) withholds information that 

has been requested by the administering 

authority or the Commission under this 

title, (B) fails to provide such 

information by the deadlines for 

submission of the information or in the 

form and manner requested, subject to 

subsections (c)(I) and (e) of section 782, 

(C) significantly impedes a proceeding 

under this title, or (D) provides such 

information but the information cannot 

be verified as provided in section 782(i), 

the administering authority and the 

Commission shall, subject to section 

782(d), use the facts otherwise available 

in reaching the applicable 

determination under this title. 

The statute requires that certain 

conditions be met before the 

Department may resort to the facts 

otherwise available. When the 

Department determines that a response 

to a request for information does not 

comply with the request, section 782(d) 

of the Act provides that the Department 

will so inform the party submitting the 

response and will, to the extent 

practicable, provide that party the 

opportunity to remedy or explain the 

deficiency. Because the PRC entity did 

not respond to the Department’s request 

for information, we find that the PRC 

entity withheld requested information 

and, thus, significantly impeded this 

proceeding. Therefore, we have 

preliminarily determined to use facts 

available, in accordance with section 

776(a)(2)(A) and (C) of the Act in 

determining whether there were 

massive imports of merchandise 

produced by the PRC entity. 

Section 776(b) of the Act provides 

that if the Department finds that the 

respondent ‘‘has failed to cooperate by 

not acting to the best of its ability to 

comply with a request for information 

{the Department} may use an inference 

that is adverse to the interests of that 

party in selecting from among the facts 

otherwise available.’’ We have 

determined that, in not responding to 

the Department’s questionnaires, the 

PRC entity has not acted to the best of 

its ability and an adverse inference is 

warranted.’’ Thus, we have made an 

adverse inference that there were 

massive imports from the PRC entity 

over a relatively short period. 

In this case, the HTS numbers listed 

in the scope of the investigation include 

both subject merchandise and nonsubject merchandise, and thus, we were 

not able to distinguish the amounts of 

shipments accounted for by the 

mandatory and separate rate 

respondents from the amount of 

shipments accounted for by the PRC 

Entity with respect to subject 

merchandise.’’ 31 Accordingly, we were 

not able to use the U.S. Census Bureau 

data to corroborate our adverse 

inference. However, as the SAA states, 

‘‘The fact that corroboration may not be 

practicable in a given circumstance will 

not prevent the agencies from applying 

an adverse inference under subsection 

(b).’’ 32 We will make a final 

determination concerning critical 

circumstances for all producers/ 

exporters of subject merchandise from 

the PRC when we make our final 

dumping determination in this 

investigation. 

Critical Circumstances Findings 

Based on the above analysis, we 

preliminarily determine that critical 

circumstances do not exist for 

Changbao, TPCO or the separate-rate 

respondents. Further, we preliminarily 

determine that critical circumstances do 

exist with respect to imports of the PRC 

entity. 

Separate Rate Applications 

Between May 15, 2009, and July 7, 

2009, we received timely-filed separaterate applications (‘‘SRA’’) from 38 

companies. 

Product Characteristics & 

Questionnaires 

In the Initiation Notice, the 

Department asked all parties in this 

investigation for comments on the 

appropriate product characteristics of 

OCTG to be reported in response to the 

Department’s antidumping 

questionnaires. On May 18, 2009, we 

received comments from Petitioners and 

TPCO regarding product characteristics. 

On May 26, 2009, Petitioners provided 

rebuttal comments concerning the 

appropriate product characteristics. 

On July 1, 2009, the Department 

issued its antidumping duty 

questionnaire to TPCO and Changbao. 

TPCO submitted its Section A response 

to the Department’s questionnaire on 

July 30, 2009, and Sections C and D 

responses on August 20 and 24, 2009, 

respectively. Changbao submitted its 

Section A response to the Department’s 

questionnaire on July 29, 2009, and 

Sections C and D responses on August 

19, 2009. The Department issued several 

supplemental questionnaires to both 

Changbao and TPCO between August 

and October 2009. Both parties 

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33See Letter to All Interested Parties, 

‘‘Antidumping Duty Investigation of Oil Country 

Tubular Goods from the People’s Republic of China: 

Request for Comments on the Selection of a 

Surrogate Country and Surrogate Values,’’ dated 

August 14, 2009, attaching the Memorandum to 

Wendy J. Frankel, ‘‘Request for a List of Surrogate 

Countries for an Investigation of Oil Country 

Tubular Goods (‘‘OCTG’’) from the People’s 

Republic of China (‘‘PRC’’),’’ dated July 31, 2009. 

34See Memorandum to Wendy J. Frankel, 

‘‘Request for a List of Surrogate Countries for an 

Investigation of Oil Country Tubular Goods 

(‘‘OCTG’’) from the People’s Republic of China 

(‘‘PRC’’) (‘‘Office of Policy Surrogate Countries 

Memorandum’’), dated July 31, 2009. 

35See id. 

responded timely to those supplemental 

questionnaires. 

Surrogate Country Comments 

On July 31, 2009, the Department 

determined that India, the Philippines, 

Indonesia, Colombia, Thailand and Peru 

are countries comparable to the PRC in 

terms of economic development, and 

requested comments on surrogate 

country selection from the interested 

parties in this investigation.33 On 

September 1, 2009, Petitioners 

submitted surrogate country comments 

stating that the Department should 

select India as a surrogate country and 

TPCO indicated that it did not object to 

the use of India as a surrogate country. 

No other interested parties commented 

on the selection of a surrogate country. 

For a detailed discussion of the 

selection of the surrogate country, see 

‘‘Surrogate Country’’ section below. 

Surrogate Value Comments 

On September 11, 2009, TPCO and 

Changbao submitted surrogate value 

comments. On September 14, 2009, 

Petitioners submitted surrogate value 

comments. On September 18, 2009, 

Changbao submitted rebuttal comments 

to Petitioner’s September 14, 2009 

submission. On September 18, 2009, 

Petitioners submitted rebuttal comments 

to TPCO’s September 11, 2009, 

surrogate value submission and rebuttal 

comments to TPCO and Changbao’s 

September 11, 2009, surrogate value 

submissions. 

Scope of Investigation 

The merchandise covered by the 

investigation consists of certain oil 

country tubular goods (‘‘OCTG’’), which 

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, regardless of end 

finish (e.g., whether or not plain end, 

threaded, or threaded and coupled) 

whether or not conforming to American 

Petroleum Institute (‘‘API’’) or non-API 

specifications, whether finished 

(including limited service OCTG 

products) or unfinished (including 

green tubes and limited service OCTG 

products), whether or not thread 

protectors are attached. The scope of the 

investigation also covers OCTG 

coupling stock. Excluded from the scope 

of the investigation are casing or tubing 

containing 10.5 percent or more by 

weight of chromium; drill pipe; 

unattached couplings; and unattached 

thread protectors. 

The merchandise covered by the 

investigation is 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, 

7304.29.31.10, 7304.29.31.20, 

7304.29.31.30, 7304.29.31.40, 

7304.29.31.50, 7304.29.31.60, 

7304.29.31.80, 7304.29.41.10, 

7304.29.41.20, 7304.29.41.30, 

7304.29.41.40, 7304.29.41.50, 

7304.29.41.60, 7304.29.41.80, 

7304.29.50.15, 7304.29.50.30, 

7304.29.50.45, 7304.29.50.60, 

7304.29.50.75, 7304.29.61.15, 

7304.29.61.30, 7304.29.61.45, 

7304.29.61.60, 7304.29.61.75, 

7305.20.20.00, 7305.20.40.00, 

7305.20.60.00, 7305.20.80.00, 

7306.29.10.30, 7306.29.10.90, 

7306.29.20.00, 7306.29.31.00, 

7306.29.41.00, 7306.29.60.10, 

7306.29.60.50, 7306.29.81.10, and 

7306.29.81.50. 

The OCTG coupling stock covered by 

the investigation may also enter under 

the following HTSUS item numbers: 

7304.39.00.24, 7304.39.00.28, 

7304.39.00.32, 7304.39.00.36, 

7304.39.00.40, 7304.39.00.44, 

7304.39.00.48, 7304.39.00.52, 

7304.39.00.56, 7304.39.00.62, 

7304.39.00.68, 7304.39.00.72, 

7304.39.00.76, 7304.39.00.80, 

7304.59.60.00, 7304.59.80.15, 

7304.59.80.20, 7304.59.80.25, 

7304.59.80.30, 7304.59.80.35, 

7304.59.80.40, 7304.59.80.45, 

7304.59.80.50, 7304.59.80.55, 

7304.59.80.60, 7304.59.80.65, 

7304.59.80.70, and 7304.59.80.80. 

The HTSUS subheadings are provided 

for convenience and customs purposes 

only, the written description of the 

scope of the investigation is dispositive. 

Non-Market Economy Country 

For purposes of initiation, Petitioners 

submitted LTFV analyses for the PRC as 

an NME. See Initiation Notice, 74 FR at 

20674. The Department considers the 

PRC to be a NME country. See 

Preliminary Determination of Sales at 

Less Than Fair Value and Postponement 

of Final Determination: Coated Free 

Sheet Paper from the People’s Republic 

of China, 72 FR 30758, 30760 (June 4, 

2007), unchanged in Final 

Determination of Sales at Less Than 

Fair Value: Coated Free Sheet Paper 

from the People’s Republic of China, 72 

FR 60632 (October 25, 2007). In 

accordance with section 771(18)(C)(i) of 

the Act, any determination that a foreign 

country is an NME country shall remain 

in effect until revoked by the 

administering authority. The 

Department has not revoked its 

determination that the PRC is an NME 

country, and no party has challenged 

the designation of the PRC as an NME 

country in this investigation. Therefore, 

we continue to treat the PRC as an NME 

country for purposes of this preliminary 

determination. 

Surrogate Country 

When the Department is investigating 

imports from an NME, section 773(c)(1) 

of the Act directs it to base normal 

value, in most circumstances, on the 

NME producer’s factors of production 

(‘‘FOPs’’) valued in a surrogate marketeconomy country or countries 

considered to be appropriate by the 

Department. In accordance with section 

773(c)(4) of the Act, in valuing the 

FOPs, the Department shall utilize, to 

the extent possible, the prices or costs 

of FOPs in one or more market-economy 

countries that are at a level of economic 

development comparable to that of the 

NME country and are significant 

producers of comparable merchandise. 

The sources of the surrogate values we 

have used in this investigation are 

discussed under the ‘‘Normal Value’’ 

section below. 

The Department determined that 

India, the Philippines, Indonesia, 

Colombia, Thailand and Peru are 

countries comparable to the PRC in 

terms of economic development.34 Once 

the countries that are economically 

comparable to the PRC have been 

identified, we select an appropriate 

surrogate country by determining 

whether an economically comparable 

country is a significant producer of 

comparable merchandise and whether 

the data for valuing FOPs is both 

available and reliable.35 In their 

September 1, 2009, submission, 

Petitioners argued that the Department 

should select India as a surrogate 

country because it satisfies the statutory 

requirements for the selection of a 

surrogate country since it is at a level of 

economic development that is 

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36See letter from Petitioners, ‘‘Oil Country 

Tubular Goods from the People’s Republic of China: 

Surrogate Country Selection,’’ dated September 1, 

2009. 

37See letter from TPCO, ‘‘TPCO’s Surrogate 

Country Comments: Certain Oil Country Tubular 

Goods (OCTG) from China,’’ dated September 1, 

2009. 

38See letter from TPCO, ‘‘TPCO’s Surrogate 

Country Comments: Certain Oil Country Tubular 

Goods (OCTG) from China,’’ dated September 1, 

2009, see also letter from Petitioners, ‘‘Certain Oil 

Country Tubular Goods from the People’s Republic 

of China: Surrogate Values,’’ dated September 11, 

2009; letter from TPCO, ‘‘TPCO’s Surrogate Country 

Comments: Certain Oil Country Tubular Goods 

(OCTG) from China,’’ dated September 11, 2009; 

letter from Changbao, ‘‘Antidumping Investigation: 

Certain Oil Country Tubular Goods from the 

People’s Republic of China (C–570–944)— 

Comments on Surrogate Values,’’ dated September 

11, 2009. In addition, see also letter from Maverick, 

‘‘Certain Oil Country Tubular Goods from the 

People’s Republic of China: Reply to Respondents’ 

Surrogate Value Submissions,’’ dated September 18, 

2009; letter from Petitioners, ‘‘Selection of 

Surrogate Values in Certain Oil Country Tubular 

Goods from the People’s Republic of China,’’ dated 

September 18, 2009; and, letter from Changbao, 

‘‘Antidumping Investigation: Certain Oil Country 

Tubular Goods from the People’s Republic of China 

(A–570–944)—Response to Petitioners’ Comments 

Regarding Surrogate Values,’’ dated September 18, 

2009. 

39See Memorandum to Wendy J. Frankel, ‘‘Oil 

Country Tubular Goods from the People’s Republic 

of China: Surrogate Value Memorandum’’ 

(November 4, 2004) (‘‘Surrogate Value 

Memorandum’’). 

40 In accordance with 19 CFR 351.301(c)(1), for 

the final determination of this investigation, 

interested parties may submit factual information to 

rebut, clarify, or correct factual information 

submitted by an interested party less than ten days 

before, on, or after, the applicable deadline for 

submission of such factual information. However, 

the Department notes that 19 CFR 351.301(c)(1) 

permits new information only insofar as it rebuts, 

clarifies, or corrects information recently placed on 

the record. The Department generally will not 

accept the submission of additional, previously 

absent-from-the-record alternative surrogate value 

information pursuant to 19 CFR 351.301(c)(1). See 

Glycine from the People’s Republic of China: Final 

Results of Antidumping Duty Administrative 

Review and Final Rescission, in Part, 72 FR 58809 

(October 17, 2007), and accompanying Issues and 

Decision Memorandum at Comment 2. 

41See also Policy Bulletin 05.1, which states: ’’ 

[w]hile continuing the practice of assigning separate 

rates only to exporters, all separate rates that the 

Department will now assign in its NME 

investigations will be specific to those producers 

that supplied the exporter during the period of 

investigation. Note, however, that one rate is 

calculated for the exporter and all of the producers 

which supplied subject merchandise to it during 

the period of investigation. This practice applies 

both to mandatory respondents receiving an 

individually calculated separate rate as well as the 

pool of non-investigated firms receiving the 

weighted-average of the individually calculated 

rates. This practice is referred to as the application 

of ‘‘combination rates’’ because such rates apply to 

specific combinations of exporters and one or more 

producers. The cash-deposit rate assigned to an 

exporter will apply only to merchandise both 

exported by the firm in question and produced by 

a firm that supplied the exporter during the period 

of investigation.’’ 

42The 38 separate-rate applicants are: (1) Angang 

Group Hong Kong Co., Ltd.; (2) Angang Steel Co., 

Ltd.; and Angang Group International Trade 

Corporation; (3) Anhui Tianda Oil Pipe Co., Ltd.; 

(4) Anshan Zhongyou Tipo Pipe & Tubing Co., Ltd.; 

(5) Baotou Steel International Economic and 

Trading Co., Ltd.; (6) Benxi Northern Steel Pipes 

Co., Ltd.; (7) Chengdu Wanghui Petroleum Pipe Co. 

Ltd.; (8) Dalipal Pipe Company; (9) Faray Petroleum 

Steel Pipe Co. Ltd.; (10) Freet Petroleum Equipment 

Co., Ltd. of Shengli Oil Field, The Thermal 

Recovery Equipment, Zibo Branch; (11) Hengyang 

Steel Tube Group International Trading, Inc.; (12) 

Huludao Steel Pipe Industrial Co., Ltd.; (13) Jiangsu 

Chengde Steel Tube Share Co., Ltd.; (14) Jiangyin 

City Changjiang Steel Pipe Co., Ltd.; (15) Pangang 

Group Beihai Steel Pipe Corporation; (16) Pangang 

Group Chengdu Iron & Steel; (17) Qingdao Bonded 

Logistics Park Products International Trading Co., 

Ltd.; (18) Qiqihaer Bonded Logistics Park Products 

International Trading Co., Ltd.; (19) Shandong 

Dongbao Steel Pipe Co., Ltd.; (20) ShanDong 

HuaBao Steel Pipe Co., Ltd.; (21) Shandong Molong 

Petroleum Machinery Co., Ltd.; (22) Shanghai 

Metals & Minerals Import & Export Corp.; (23) 

Shanghai Zhongyou Tipo Steel Pipe Co., Ltd.; (24) 

Shengli Oil Field Freet Petroleum Equipment Co., 

Ltd.; (25) Shengli Oil Field Freet Petroleum Steel 

Pipe Co., Ltd.; (26) Shengli Oilfield Highland 

Petroleum Equipment Co., Ltd.; (27) Shengli 

Oilfield Shengji Petroleum Equipment Co., Ltd.; 

(28) Tianjin Lifengyuanda Steel Group Co., Ltd.; 

(29) Tianjin Seamless Steel Pipe Plant; (30) Tianjin 

Tiangang Special Petroleum Pipe Manufacturer Co., 

Ltd.; (31) Wuxi Baoda Petroleum Special Pipe 

Manufacturing Co., Ltd.; (32) Wuxi Seamless Oil 

Pipe Co., Ltd.; (33) Wuxi Sp. Steel Tube 

Manufacturing Co., Ltd.; (34) Wuxi Zhenda Special 

Steel Tube Manufacturing Co., Ltd.; (35) Xigang 

Seamless Steel Tube Co., Ltd.; (36) Yangzhou 

Lontrin Steel Tube Co., Ltd.; (37) Zhejiang JianLi 

Enterprise Co., Ltd.; and (38) Shengli Oil Field Freet 

Import & Export Trade Co., Ltd. (which submitted 

a separate-rate application but subsequently 

discovered that shipments of subject merchandise 

were not made during the POI. Therefore, because 

this company had no shipments of subject 

Continued 

comparable to the PRC, and is a 

significant producer of merchandise 

comparable to the merchandise under 

investigation. Petitioners also noted that 

the Department can readily value the 

major factors of production for subject 

merchandise using reliable, publicly 

available data from Indian sources.36

TPCO stated that it did not object to 

Petitioners’ request that the Department 

select India as the primary surrogate 

country for this investigation.37 No 

other party provided comments on the 

record concerning the surrogate country. 

We have determined that it is 

appropriate to use India as a surrogate 

country pursuant to section 773(c)(4) of 

the Act based on the following: (1) It is 

at a similar level of economic 

development pursuant to section 

773(c)(4) of the Act; (2) it is a significant 

producer of comparable merchandise; 

and (3) we have reliable data from India 

that we can use to value the FOPs.38

Thus, we have calculated normal value 

(‘‘NV’’) using Indian prices when 

available and appropriate to the FOPs of 

the OCTG producers. We have obtained 

and relied upon publicly available 

information wherever possible.39

In accordance with 19 CFR 

351.301(c)(3)(i), for the final 

determination in an antidumping 

investigation, interested parties may 

submit publicly available information to 

value the FOPs within 40 days after the 

date of publication of the preliminary 

determination.40

Affiliations 

TPCO 

Based on the evidence on the record 

in this investigation, including 

information presented in TPCO’s 

questionnaire responses, we 

preliminarily find that TPCO is 

affiliated with Companies A and B 

pursuant to section 771(33)(F) of the 

Act. The identity of these companies is 

business proprietary information 

(‘‘BPI’’); for further discussion on these 

companies, see Certain Oil Country 

Tubular Goods from the People’s 

Republic of China: Tianjin Pipe 

International Economic and Trading 

Corporation Analysis Memorandum for 

the Preliminary Determination 

(November 4, 2009) (‘‘TPCO Analysis 

Memo’’) 

Separate Rates 

In proceedings involving NME 

countries, the Department has a 

rebuttable presumption that all 

companies within the country are 

subject to government control and thus 

should be assessed a single antidumping 

duty rate. It is the Department’s policy 

to assign all exporters of merchandise 

subject to investigation in an NME 

country this single rate unless an 

exporter can demonstrate that it is 

sufficiently independent so as to be 

entitled to a separate rate. Exporters can 

demonstrate this independence through 

the absence of both de jure and de facto 

governmental control over export 

activities. The Department analyzes 

each entity exporting the subject 

merchandise under a test arising from 

Final Determination of Sales at Less 

Than Fair Value: Sparklers from the 

People’s Republic of China, 56 FR 20588 

(May 6, 1991) (‘‘Sparklers’’), as further 

developed in Final Determination of 

Sales at Less Than Fair Value: Silicon 

Carbide from the People’s Republic of 

China, 59 FR 22585 (May 2, 1994) 

(‘‘Silicon Carbide ’’).41 However, if the 

Department determines that a company 

is wholly foreign-owned or located in a 

market economy, then a separate-rate 

analysis is not necessary to determine 

whether it is independent from 

government control. 

Between May 15, 2009, and July 7, 

2009, we received timely-filed SRAs 

from 38 companies (hereinafter referred 

to as ‘‘SR Applicants’’).42 However, one 

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merchandise during the POI, they are not eligible 

for a separate-rate). 43See Final Determination of Sales at Less Than 

Fair Value: Sparklers from the People’s Republic of 

China, 56 FR at 20589 (May 6, 1991). 

44See Final Determination of Sales at Less Than 

Fair Value: Silicon Carbide from the People’s 

Republic of China, 59 FR 22585 (May 2, 1994); see 

also Notice of Final Determination of Sales at Less 

Than Fair Value: Furfuryl Alcohol From the 

People’s Republic of China, 60 FR 22544, 22545 

(May 8, 1995). 

SR Applicant, Shengli Oil Field Freet 

Import & Export Trade Co., Ltd., did not 

have any shipments of the merchandise 

under investigation during the POI, and 

so is not eligible for consideration for a 

separate rate. The remaining SR 

Applicants have all stated that they are 

either joint ventures between Chinese 

and foreign companies, or are wholly 

Chinese-owned companies. Therefore, 

the Department must analyze whether 

these respondents can demonstrate the 

absence of both de jure and de facto 

governmental control over export 

activities. 

a. Absence of De Jure Control 

The Department considers the 

following de jure criteria in determining 

whether an individual company may be 

granted a separate rate: (1) An absence 

of restrictive stipulations associated 

with an individual exporter’s business 

and export licenses; (2) any legislative 

enactments decentralizing control of 

companies; and (3) other formal 

measures by the government 

decentralizing control of companies. 

The mandatory respondents and SR 

Applicants provided evidence 

demonstrating: (1) An absence of 

restrictive stipulations associated with 

an individual exporter’s business and 

export licenses; (2) legislative 

enactments decentralizing control of 

companies; and (3) other formal 

measures by the government 

decentralizing control of 

companies.43 See their respective 

separate rate applications, on file in the 

central records unit at the Department of 

Commerce, see also Changbao’s July 29, 

2009, Section A questionnaire response 

and TPCO’s July 30, 2009, Section A 

questionnaire response. 

b. Absence of De Facto Control 

Typically the Department considers 

four factors in evaluating whether each 

respondent is subject to de facto 

governmental control of its export 

functions: (1) Whether the export prices 

are set by or are subject to the approval 

of a governmental agency; (2) whether 

the respondent has authority to 

negotiate and sign contracts and other 

agreements; (3) whether the respondent 

has autonomy from the government in 

making decisions regarding the 

selection of management; and (4) 

whether the respondent retains the 

proceeds of its export sales and makes 

independent decisions regarding 

disposition of profits or financing of 

losses.44 The Department has 

determined that an analysis of de facto 

control is critical in determining 

whether respondents are, in fact, subject 

to a degree of governmental control 

which would preclude the Department 

from assigning separate rates. 

The mandatory respondents and the 

SR Applicants provided evidence 

demonstrating: (1) That the export 

prices are not set by, and are not subject 

to, the approval of a governmental 

agency; (2) they have authority to 

negotiate and sign contracts and other 

agreements; (3) they have autonomy 

from the government in making 

decisions regarding the selection of 

management; and (4) they retain the 

proceeds of their export sales and make 

independent decisions regarding 

disposition of profits or financing of 

losses. See their respective separate rate 

applications, on file in the central 

records unit at the Department of 

Commerce, see also Changbao’s July 29, 

2009, Section A questionnaire response 

and TPCO’s July 30, 2009, Section A 

questionnaire response. 

The evidence placed on the record of 

this investigation by the mandatory 

respondents and 37 of the SR 

Applicants demonstrates an absence of 

de jure and de facto government control 

with respect to each of the exporter’s 

exports of the merchandise under 

investigation, in accordance with the 

criteria identified in Sparklers and 

Silicon Carbide. As a result, we have 

preliminarily granted Changbao and 

TPCO and each of these 37 SR 

Applicants (hereinafter referred to as the 

‘‘Separate Rate Companies’’), separaterate status. 

The PRC-Wide Entity 

The Department has data that indicate 

there were more exporters of OCTG 

from the PRC than those indicated in 

the response to our request for Q&V 

information during the POI. See 

Respondent Selection Memorandum. 

We issued our request for Q&V 

information to 212 potential Chinese 

exporters of the merchandise under 

investigation, in addition to posting the 

Q&V questionnaire on the Department’s 

website. While information on the 

record of this investigation indicates 

that there are other producers/exporters 

of OCTG in the PRC, we received only 

43 timely filed Q&V responses. 

Although all exporters were given an 

opportunity to provide Q&V 

information, not all exporters provided 

a response to the Department’s Q&V 

letter. Therefore, the Department has 

preliminarily determined that there 

were exporters/producers of the 

merchandise under investigation during 

the POI from the PRC that did not 

respond to the Department’s request for 

information. We have treated these PRC 

producers/exporters as part of the PRCwide entity because they did not qualify 

for a separate rate. See, e.g., Preliminary 

Determination of Sales at Less Than 

Fair Value, Postponement of Final 

Determination, and Preliminary Partial 

Determination of Critical 

Circumstances: Diamond Sawblades 

and Parts Thereof From the People’s 

Republic of China, 70 FR 77121, 77128 

(December 29, 2005), unchanged in 

Final Determination of Sales at Less 

Than Fair Value and Final Partial 

Affirmative Determination of Critical 

Circumstances: Diamond Sawblades 

and Parts Thereof from the People’s 

Republic of China, 71 FR 29303 (May 

22, 2006). 

Application of Adverse Facts Available 

and the PRC-Wide Rate 

Section 776(a)(2) of the Act provides 

that, if an interested party (A) withholds 

information that has been requested by 

the Department, (B) fails to provide such 

information in a timely manner or in the 

form or manner requested, subject to 

subsections 782(c)(1) and (e) of the Act, 

(C) significantly impedes a proceeding 

under the antidumping statute, or (D) 

provides such information but the 

information cannot be verified, the 

Department shall, subject to subsection 

782(d) of the Act, use facts otherwise 

available in reaching the applicable 

determination. 

Information on the record of this 

investigation indicates that the PRCwide entity was non-responsive. Certain 

companies did not respond to our 

questionnaire requesting Q&V 

information. As a result, pursuant to 

section 776(a)(2)(A) of the Act, we find 

that the use of facts available (‘‘FA’’) is 

appropriate to determine the PRC-wide 

rate. See Preliminary Determination of 

Sales at Less Than Fair Value, 

Affirmative Preliminary Determination 

of Critical Circumstances and 

Postponement of Final Determination: 

Certain Frozen Fish Fillets from the 

Socialist Republic of Vietnam, 68 FR 

4986 (January 31, 2003), unchanged in 

Final Determination of Sales at Less 

Than Fair Value and Affirmative 

Critical Circumstances: Certain Frozen 

Fish Fillets from the Socialist Republic 

of Vietnam, 68 FR 37116 (June 23, 

2003). 

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45See SAA at 870. 

46See id. 

47See id. 

48See Tapered Roller Bearings and Parts Thereof, 

Finished and Unfinished, from Japan, and Tapered 

Roller Bearings, Four Inches or Less in Outside 

Diameter, and Components Thereof, from Japan; 

Preliminary Results of Antidumping Duty 

Administrative Reviews and Partial Termination of 

Administrative Reviews, 61 FR 57391, 57392 

(November 6, 1996), unchanged in Final Results of 

Antidumping Duty Administrative Reviews and 

Termination in Part: Tapered Roller Bearings and 

Parts Thereof, Finished and Unfinished, From 

Japan, and Tapered Roller Bearings, Four Inches or 

Less in Outside Diameter, and Components Thereof, 

From Japan, 62 FR 11825 (March 13, 1997). 

49See Notice of Initiation, 74 FR at 20676. 

50See Notice of Initiation, 72 FR at 43593. 

51See, e.g., Preliminary Determination of Sales at 

Less Than Fair Value and Partial Affirmative 

Determination of Critical Circumstances: Certain 

Polyester Staple Fiber from the People’s Republic of 

China, 71 FR 77373, 77377 (December 26, 2006) 

(‘‘PSF’’), unchanged in Final Determination of Sales 

at Less Than Fair Value and Partial Affirmative 

Determination of Critical Circumstances: Certain 

Polyester Staple Fiber from the People’s Republic of 

China, 72 FR 19690 (April 19, 2007), see also the 

‘‘Separate Rates’’ section. 

52See Petitioners’ Letter to the Department: 

Certain Oil Country Tubular Goods from the 

People’s Republic of China: Request that the 

Department Collect Additional Data from the 

Respondents (May 22, 2009). 

Section 776(b) of the Act provides 

that, in selecting from among the facts 

otherwise available, the Department 

may employ an adverse inference if an 

interested party fails to cooperate by not 

acting to the best of its ability to comply 

with requests for information. See SAA, 

H.R. Rep. No. 103–316, 870 (1994); see 

also Final Determination of Sales at 

Less Than Fair Value: Certain ColdRolled Flat-Rolled Carbon-Quality Steel 

Products from the Russian Federation, 

65 FR 5510, 5518 (February 4, 2000). We 

find that, because the PRC-wide entity 

did not respond to our requests for 

information, it has failed to cooperate to 

the best of its ability. Therefore, the 

Department preliminarily finds that, in 

selecting from among the facts available, 

an adverse inference is appropriate. 

When employing an adverse 

inference, section 776 of the Act 

indicates that the Department may rely 

upon information derived from the 

petition, the final determination from 

the LTFV investigation, a previous 

administrative review, or any other 

information placed on the record. In 

selecting a rate for adverse facts 

available (‘‘AFA’’), the Department 

selects a rate that is sufficiently adverse 

to ensure that the uncooperative party 

does not obtain a more favorable result 

by failing to cooperate than if it had 

fully cooperated. It is the Department’s 

practice to select, as AFA, the higher of 

the (a) highest margin alleged in the 

petition, or (b) the highest calculated 

rate of any respondent in the 

investigation. See Final Determination 

of Sales at Less Than Fair Value: 

Certain Cold-Rolled Carbon Quality 

Steel Products from the People’s 

Republic of China, 65 FR 34660 (May 

21, 2000) and accompanying Issues and 

Decision Memorandum, at Comment 1. 

As AFA, we have preliminarily assigned 

to the PRC-wide entity a rate of 99.14 

percent, the highest calculated rate from 

the petition. The Department 

preliminarily determines that this 

information is the most appropriate 

from the available sources to effectuate 

the purposes of AFA. The Department’s 

reliance on the petition rates to 

determine an AFA rate is subject to the 

requirement to corroborate secondary 

information. 

Corroboration 

Section 776(c) of the Act provides 

that, when the Department relies on 

secondary information rather than on 

information obtained in the course of an 

investigation as FA, it must, to the 

extent practicable, corroborate that 

information from independent sources 

reasonably at its disposal. Secondary 

information is described in the SAA as 

‘‘information derived from the petition 

that gave rise to the investigation or 

review, the final determination 

concerning subject merchandise, or any 

previous review under section 751 

concerning the subject merchandise.’’ 45

The SAA provides that to ‘‘corroborate’’ 

means simply that the Department will 

satisfy itself that the secondary 

information to be used has probative 

value.46 The SAA also states that 

independent sources used to corroborate 

may include, for example, published 

price lists, official import statistics and 

customs data, and information obtained 

from interested parties during the 

particular investigation.47 To 

corroborate secondary information, the 

Department will, to the extent 

practicable, examine the reliability and 

relevance of the information used.48

As AFA the Department has 

preliminarily selected the rate of 99.14 

from the Petition.49 Petitioners’ 

methodology for calculating the EP and 

NV in the petition is discussed in the 

initiation notice.50 To corroborate the 

AFA margin we have selected, we 

compared that margin to the margins we 

found for the respondents. We found 

that the margin of 99.14 percent has 

probative value because it is in the 

range of margins we found for the 

mandatory respondents. Accordingly, 

we find that the rate of 99.14 percent is 

corroborated within the meaning of 

section 776(c) of the Act. 

Margin for the Separate-Rate 

Companies 

Consistent with the Department’s 

practice, we have established an average 

margin for the Separate-Rate Companies 

based on the rates we calculated for 

Changbao and TPCO (the mandatory 

respondents), excluding any rates that 

are zero, de minimis, or based entirely 

on AFA.51 The Separate-Rate 

Companies are listed in the 

‘‘Suspension of Liquidation’’ section of 

this notice. 

Date of Sale 

19 CFR 351.401(i) states that, ‘‘[i]n 

identifying the date of sale of the subject 

merchandise or foreign like product, the 

Secretary normally will use the date of 

invoice, as recorded in the exporter or 

producer’s records kept in the ordinary 

course of business.’’ In Allied Tube, the 

Court of International Trade (‘‘CIT’’) 

noted that a ‘‘party seeking to establish 

a date of sale other than invoice date 

bears the burden of producing sufficient 

evidence to ‘satisf{y}’ the Department 

that ‘a different date better reflects the 

date on which the exporter or producer 

establishes the material terms of sale.’’’ 

Allied Tube & Conduit Corp. v. United 

States, 132 F. Supp. 2d 1087, 1090 (CIT 

2001) (‘‘Allied Tube’’). Additionally, the 

Secretary may use a date other than the 

date of invoice if the Secretary is 

satisfied that a different date better 

reflects the date on which the exporter 

or producer establishes the material 

terms of sale. See 19 CFR 351.401(i); see 

also Allied Tube, 132 F. Supp. 2d at 

1090–1092. The date of sale is generally 

the date on which the parties agree 

upon all substantive terms of the sale. 

This normally includes the price, 

quantity, delivery terms and payment 

terms. See Carbon and Alloy Steel Wire 

Rod from Trinidad and Tobago: Final 

Results of Antidumping Duty 

Administrative Review, 72 FR 62824 

(November 7, 2007), and accompanying 

Issue and Decision Memorandum at 

Comment 1; Notice of Final 

Determination of Sales at Less Than 

Fair Value: Certain Cold-Rolled FlatRolled Carbon Quality Steel Products 

from Turkey, 65 FR 15123 (March 21, 

2000), and accompanying Issues and 

Decision Memorandum at Comment 1. 

On May 22, 2009, Petitioners 

submitted a letter to the Department 

alleging that U.S. distributors of Chinese 

OCTG testified before the ITC that there 

was a six-month lag between the order 

date and entry-date of the subject 

merchandise into the United States.52

Further, Petitioners contended that the 

U.S. customers of Chinese OCTG were 

required to place a significant down 

payment on their orders. Moreover, 

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53See Letter from the Department: Less-ThanFair-Value Investigation of Certain Oil Country 

Tubular Goods (‘‘OCTG’’) from the People’s 

Republic of China (‘‘PRC’’): Date of Sale 

Questionnaire (July 1, 2009) to TPCO, Changbao 

and Lifengyuanda. 

54See TPCO Analysis Memo and Changbao 

Analysis Memo for a more thorough discussion of 

this issue involving BPI information. 

55See id. 56The identity of these companies is business 

proprietary; for further discussion of these 

companies, see TPCO Analysis Memo. 

57See Changbao’s October 19, 2009, 

Supplemental Section C response at 1–3. 

Petitioners claimed that the U.S. prices 

for OCTG dropped during the POI, and 

that raw material input costs for OCTG 

declined significantly as well. 

Petitioners argued that, as a result of the 

above, if respondents reported U.S. sales 

of subject merchandise on the basis of 

invoice date, the Department’s standard 

NME methodology would compare U.S. 

sales whose prices were set six months 

prior to the POI with costs that were 

established during the POI. Thus, 

Petitioners requested that the 

Department direct respondents to report 

the following information in the 

questionnaire response and U.S. sales 

database: Sales of subject merchandise 

to the United States that had a contract 

or sale order date within the POI, and 

the dates of the contract and sale orders 

for these sales, and the contract and sale 

order dates for the U.S. sales that were 

shipped or invoiced during the POI. 

Based on Petitioners’ allegation, the 

Department issued a supplemental 

questionnaire on July 1, 2009, 

requesting the above information (‘‘Date 

of Sale Questionnaire’’).53 The 

Department did not, however, require 

that the respondents submit the data 

associated with the above information 

in their U.S. sales database. 

In their July 22, 2009, responses to the 

Date of Sale Questionnaire, both TPCO 

and Changbao argued that the invoice 

date is the earliest date at which terms 

of sale are finalized.54

On July 23, 2009, Petitioners 

submitted another letter to the 

Department which argued that 

respondents did not sufficiently 

describe how changes in quantity and 

price were established, and again 

requested that the Department require 

respondents to report: Each sale that has 

a contract or purchase order (‘‘PO’’) date 

within the POI; each sale that has an 

invoice during the POI; and, for CEP 

sales, each sale with an agreement made 

during the POI and also each sale with 

an invoice during the POI. The 

Department did not, however, issue 

another date of sale questionnaire. 

TPCO reported the date of the 

commercial invoice to the first 

unaffiliated party as the date of sale for 

both CEP and EP sales. Changbao also 

reported the date of the commercial 

invoice to the first unaffiliated party as 

the date of sale for its EP sales. Upon 

examination of the information in the 

Date of Sale Questionnaires, and the 

respondents’ Section C and 

supplemental Section C responses, the 

Department found no evidence contrary 

to TPCO’s or Changbao’s assertions that 

invoice date was the appropriate date of 

sale. Thus, the Department used invoice 

date as the date of sale for this 

preliminary determination.55

Fair Value Comparison 

To determine whether sales of certain 

OCTG to the United States by TPCO and 

Changbao were made at less than fair 

value, we compared EP or CEP, as 

applicable, to NV, as described in the 

‘‘U.S. Price’’ and ‘‘Normal Value’’ 

sections of this notice. 

Constructed Export Price 

In accordance with section 772(b) of 

the Act, we based the U.S. price for 

certain of TPCO’s sales on CEP because 

these sales were made by TPCO’s U.S. 

affiliates,56 Company A, and Company 

B. In accordance with section 

772(c)(2)(A) of the Act, we calculated 

CEP by deducting, where applicable, the 

following expenses from the gross unit 

price charged to the first unaffiliated 

customer in the United States, foreign 

movement expenses, and U.S. 

movement expenses, including U.S. 

duties, U.S. warehousing, and inventory 

carrying cost. Further, in accordance 

with section 772(d)(1) of the Act and 19 

CFR 351.402(b), where appropriate, we 

deducted from the starting price the 

following selling expenses associated 

with economic activities occurring in 

the United States: Credit expenses and 

other direct selling expenses. In 

addition, pursuant to section 772(d)(3) 

of the Act, we made an adjustment to 

the starting price for CEP profit. We 

based movement expenses on either 

surrogate values or actual expenses 

(where paid for in a market economy 

currency and performed by a market 

economy provider). For details 

regarding our CEP calculations, and for 

a complete discussion of the calculation 

of the U.S. price for TPCO, see TPCO 

Analysis Memo. 

Export Price 

In accordance with section 772(a) of 

the Act, we based the U.S. price for 

certain of TPCO’s sales, and all of 

Changbao’s sales, on EP because the 

subject merchandise was sold directly to 

the unaffiliated customers in the United 

States prior to importation. In 

accordance with section 772(a) of the 

Act, 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 in the 

United States or to an unaffiliated 

purchaser for exportation to the United 

States, as adjusted under section 772(c) 

of the Act. 

We calculated EP based on the packed 

cost and freight or delivered prices to 

unaffiliated purchasers in, or for 

exportation to, the United States. We 

made deductions, as appropriate, for the 

following movement expenses: 

Domestic inland freight, domestic 

brokerage and handling, international 

freight, and marine insurance. For 

details regarding our EP calculations, 

and for a complete discussion of the 

calculation of the U.S. price for TPCO 

and Changbao, see TPCO Analysis 

Memo and Certain Oil Country Tubular 

Goods from the People’s Republic of 

China: Jiangsu Changbao Steel Tube Co., 

Ltd. Analysis Memorandum for the 

Preliminary Determination (November 

4, 2000) (‘‘Changbao Analysis Memo’’). 

In its October 19, 2009, Supplemental 

Section C response, Changbao reported 

certain sales to unaffiliated resellers in 

the PRC. This information was 

unsolicited by the Department. 

Changbao stated that it is not a party to 

the contracts between its Chinese 

customers and their U.S. customers, is 

not involved in negotiating the U.S. 

price or other terms of sale, and the 

unaffiliated reseller takes title to the 

merchandise before exporting to the 

United States and receives payment 

from the U.S. customer. Changbao 

further provided a purchase contract 

between itself and one of these 

unaffiliated PRC resellers.57 Based upon 

the record evidence, we have 

determined that these are not 

Changbao’s U.S. sales. Further, 

Changbao has not claimed that these are 

its U.S. sales. Accordingly, for the 

preliminary determination, we have 

excluded these sales from the margin 

calculation. 

TPCO describes the customer for its 

EP sales, Company C, as an unaffiliated 

customer. However, record evidence 

indicates that Company C may be 

affiliated with TPCO. Because the 

record is not clear, we have determined 

to preliminarily treat these U.S. sales as 

EP sales and to include them in our 

margin calculation. However, we intend 

to further examine this issue after the 

preliminary determination to determine 

their appropriate treatment for purposes 

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58See, e.g., Final Determination of Sales at Less 

Than Fair Value and Critical Circumstances: 

Certain Malleable Iron Pipe Fittings From the 

People’s Republic of China, 68 FR 61395 (October 

28, 2003), and accompanying Issues and Decision 

Memorandum at Comment 19. 

of the final determination in this 

investigation. 

Normal Value 

We compared NV to weighted-average 

EPs and CEPs in accordance with 

section 777A(d)(1) of the Act. Further, 

section 773(c)(1) of the Act provides 

that the Department shall determine the 

NV using an FOP methodology if the 

merchandise is exported from an NME 

country and the information does not 

permit the calculation of NV using 

home-market prices, third-country 

prices, or constructed value under 

section 773(a) of the Act. The 

Department bases NV on the FOPs 

because the presence of government 

controls on various aspects of an NME 

renders price comparisons and the 

calculation of production costs invalid 

under its normal methodologies. 

The Department’s questionnaire 

requires that the respondent provide 

information regarding the weightedaverage FOPs across all of the 

company’s plants that produce the 

subject merchandise, not just the FOPs 

from a single plant. This methodology 

ensures that the Department’s 

calculations are as accurate as 

possible.58 The Department calculated 

the FOPs using the weighted-average 

factor values for all of the facilities 

involved in producing the subject 

merchandise for each exporter. The 

Department calculated NV for each 

matching control number (‘‘CONNUM’’) 

based on the factors of production 

reported from each of the exporters’ 

suppliers and then averaged the 

supplier-specific NVs together, 

weighted by production quantity, to 

derive a single, weighted-average NV for 

each CONNUM exported by each 

exporter. 

Factor Valuation Methodology 

In accordance with section 773(c) of 

the Act, we calculated NV based on FOP 

data reported by TPCO and Changbao. 

To calculate NV, we multiplied the 

reported per-unit factor-consumption 

rates by publicly available surrogate 

values (except as discussed below). In 

selecting the surrogate values, we 

considered the quality, specificity, and 

contemporaneity of the data. See, e.g., 

Fresh Garlic From the People’s Republic 

of China: Final Results of Antidumping 

Duty New Shipper Review, 67 FR 72139 

(December 4, 2002), and accompanying 

Issues and Decision Memorandum at 

Comment 6; and Final Results of First 

New Shipper Review and First 

Antidumping Duty Administrative 

Review: Certain Preserved Mushrooms 

From the People’s Republic of China, 66 

FR 31204 (June 11, 2001), and 

accompanying Issues and Decision 

Memorandum at Comment 5. As 

appropriate, we adjusted input prices by 

including freight costs to make them 

delivered prices. Specifically, we added 

to Indian import surrogate values a 

surrogate freight cost using the shorter 

of the reported distance from the 

domestic supplier to the factory or the 

distance from the nearest seaport to the 

factory where appropriate. This 

adjustment is in accordance with the 

Court of Appeals for the Federal 

Circuit’s decision in Sigma Corp. v. 

United States, 117 F.3d 1401, 1407–08 

(Fed. Cir. 1997). A detailed description 

of all surrogate values used for TPCO 

and Changbao can be found in Certain 

Oil Country Tubular Goods from the 

People’s Republic of China: Surrogate 

Value Memorandum for the Preliminary 

Determination (November 4, 2000) 

(‘‘Surrogate Value Memorandum’’) 

(November 4, 2009). 

For this preliminary determination, in 

accordance with the Department’s 

practice, we used data from the Indian 

Import Statistics and other publicly 

available Indian sources in order to 

calculate surrogate values for TPCO and 

Changbao’s FOPs (direct materials, 

energy, and packing materials) and 

certain movement expenses. In selecting 

the best available information for 

valuing FOPs in accordance with 

section 773(c)(1) of the Act, the 

Department’s practice is to select, to the 

extent practicable, surrogate values 

which are non-export average values, 

most contemporaneous with the POI, 

product-specific, and tax-exclusive. See, 

e.g., Notice of Preliminary 

Determination of Sales at Less Than 

Fair Value, Negative Preliminary 

Determination of Critical Circumstances 

and Postponement of Final 

Determination: Certain Frozen and 

Canned Warmwater Shrimp From the 

Socialist Republic of Vietnam, 69 FR 

42672, 42682 (July 16, 2004), unchanged 

in Final Determination of Sales at Less 

Than Fair Value: Certain Frozen and 

Canned Warmwater Shrimp from the 

Socialist Republic of Vietnam, 69 FR 

71005 (December 8, 2004). The record 

shows that data in the Indian Import 

Statistics, as well as those from the 

other Indian sources, are 

contemporaneous with the POI, 

product-specific, and tax-exclusive. See 

Surrogate Value Memorandum. In those 

instances where we could not obtain 

publicly available information 

contemporaneous to the POI with which 

to value factors, we adjusted the 

surrogate values using, where 

appropriate, the Indian Wholesale Price 

Index (‘‘WPI’’) as published in the 

International Financial Statistics of the 

International Monetary Fund. 

Furthermore, with regard to the 

Indian import-based surrogate values, 

we have disregarded import prices that 

we have reason to believe or suspect 

may be subsidized. We have reason to 

believe or suspect that prices of inputs 

from Indonesia, South Korea, and 

Thailand may have been subsidized. We 

have found in other proceedings that 

these countries maintain broadly 

available, non-industry-specific export 

subsidies and, therefore, it is reasonable 

to infer that all exports to all markets 

from these countries may be subsidized. 

See Notice of Final Determination of 

Sales at Less Than Fair Value and 

Negative Final Determination of Critical 

Circumstances: Certain Color Television 

Receivers From the People’s Republic of 

China, 69 FR 20594 (April 16, 2004), 

and accompanying Issues and Decision 

Memorandum at Comment 7. Further, 

guided by the legislative history, it is 

the Department’s practice not to 

conduct a formal investigation to ensure 

that such prices are not subsidized. See 

Omnibus Trade and Competitiveness 

Act of 1988, Conference Report to 

accompany H.R. Rep. 100–576 at 590 

(1988) reprinted in 1988 U.S.C.C.A.N. 

1547, 1623–24; see also Preliminary 

Determination of Sales at Less Than 

Fair Value: Coated Free Sheet Paper 

from the People’s Republic of China, 72 

FR 30758 (June 4, 2007) unchanged in 

Final Determination of Sales at Less 

Than Fair Value: Coated Free Sheet 

Paper from the People’s Republic of 

China, 72 FR 60632 (October 25, 2007). 

Rather, the Department bases its 

decision on information that is available 

to it at the time it makes its 

determination. See Polyethylene 

Terephthalate Film, Sheet, and Strip 

from the People’s Republic of China: 

Preliminary Determination of Sales at 

Less Than Fair Value, 73 FR 24552, 

24559 (May 5, 2008), unchanged in 

Polyethylene Terephthalate Film, Sheet, 

and Strip from the People’s Republic of 

China: Final Determination of Sales at 

Less Than Fair Value, 73 FR 55039 

(September 24, 2008). Therefore, we 

have not used prices from these 

countries in calculating the Indian 

import-based surrogate values. 

Additionally, we disregarded prices 

from NME countries. Finally, imports 

that were labeled as originating from an 

‘‘unspecified’’ country were excluded 

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59128 Federal Register / Vol. 74, No. 220 / Tuesday, November 17, 2009 / Notices 

59Available at http://www.cea.nic.in/e&c/ 

Estimated%20Average 

%20Rates%20of%20Electricity.pdf. 

from the average value, because the 

Department could not be certain that 

they were not from either an NME 

country or a country with general export 

subsidies. See id. 

Additionally, TPCO reported that 

during the POI, it purchased certain 

inputs from a market economy supplier 

and paid for the inputs in a market 

economy currency. The Department has 

a rebuttable presumption that market 

economy input prices are the best 

available information for valuing an 

input when the total volume of the 

input purchased from all market 

economy sources during the period of 

investigation or review exceeds 33 

percent of the total volume of the input 

purchased from all sources during the 

period. In these cases, unless casespecific facts provide adequate grounds 

to rebut the Department’s presumption, 

the Department will use the weightedaverage market economy purchase price 

to value the input. Alternatively, when 

the volume of an NME firm’s purchases 

of an input from market economy 

suppliers during the period is below 33 

percent of its total volume of purchases 

of the input during the period, but 

where these purchases are otherwise 

valid and there is no reason to disregard 

the prices, the Department will weightaverage the market economy purchase 

price with an appropriate surrogate 

value (‘‘SV’’) according to their 

respective shares of the total volume of 

purchases, unless case-specific facts 

provide adequate grounds to rebut the 

presumption. When a firm has made 

market economy input purchases that 

may have been dumped or subsidized, 

are not bona fide, or are otherwise not 

acceptable for use in a dumping 

calculation, the Department will 

exclude them from the numerator of the 

ratio to ensure a fair determination of 

whether valid market economy 

purchases meet the 33-percent 

threshold. See Antidumping 

Methodologies: Market Economy Inputs, 

Expected Non-Market Economy Wages, 

Duty Drawback; and Request for 

Comments, 71 FR 61716, 61717–18 

(October 19, 2006). See TPCO Analysis 

Memo. 

For direct, indirect, and packing 

labor, consistent with 19 CFR 

351.408(c)(3), we used the PRC 

regression-based wage rate as reported 

on Import Administration’s home page, 

Import Library, Expected Wages of 

Selected NME Countries, revised in May 

2008, see Corrected 2007 Calculation of 

Expected Non-Market Economy Wages, 

73 FR 27795 (May 14, 2008), and 

http://ia.ita.doc.gov/wages/index.html. 

The source of these wage-rate data on 

the Import Administration’s Web site is 

the Yearbook of Labour Statistics 2005, 

ILO (Geneva: 2007), Chapter 5B: Wages 

in Manufacturing. Because this 

regression-based wage rate does not 

separate the labor rates into different 

skill levels or types of labor, we have 

applied the same wage rate to all skill 

levels and types of labor reported by the 

respondents. 

We valued truck freight expenses 

using a per-unit average rate calculated 

from data on the Infobanc Web site: 

http://www.infobanc.com/logistics/ 

logtruck.htm. The logistics section of 

this Web site contains inland freight 

truck rates between many large Indian 

cities. 

We valued electricity using price data 

for small, medium, and large industries, 

as published by the Central Electricity 

Authority of the Government of India 

(‘‘CEA’’) in its publication titled 

Electricity Tariff & Duty and Average 

Rates of Electricity Supply in India, 

dated July 2006. These electricity rates 

represent actual country-wide, publicly 

available information on tax-exclusive 

electricity rates charged to industries in 

India. Petitioners suggested that the 

Department rely on March 2009 CEA 

data.59 However, we preliminarily find 

that we cannot rely on the suggested 

data as we are unable to separate duty 

rates from the March 2009 CEA data. 

Because water is essential to the 

production process of the merchandise 

under consideration, the Department 

considers water to be a direct material 

input, not overhead, and thus valued 

water with a surrogate value according 

to our practice. See Final Determination 

of Sales at Less Than Fair Value and 

Critical Circumstances: Certain 

Malleable Iron Pipe Fittings From the 

People’s Republic of China, 68 FR 61395 

(October 23, 2003), and accompanying 

Issues and Decision Memorandum at 

Comment 11. The Department valued 

water using data from the Maharashtra 

Industrial Development Corporation 

(http://midcindia.org) as it includes a 

wide range of industrial water tariffs. 

This source provides 378 industrial 

water rates within the Maharashtra 

province through June 2009: 189 of the 

water rates were for the ‘‘inside 

industrial areas’’ usage category and 189 

of the water rates were for the ‘‘outside 

industrial areas’’ usage category. 

We continued our recent practice to 

value brokerage and handling using a 

simple average of the brokerage and 

handling costs that were reported in 

public submissions that were filed in 

three antidumping duty cases. 

Specifically, the Department averaged 

the public brokerage and handling 

expenses reported by Navneet 

Publications (India) Ltd. in the 2007– 

2008 administrative review of certain 

lined paper products from India, Essar 

Steel Limited in the 2006–2007 

antidumping duty administrative review 

of hot-rolled carbon steel flat products 

from India, and Himalaya International 

Ltd. in the 2005–2006 administrative 

review of certain preserved mushrooms 

from India. The Department inflated the 

brokerage and handling rate using the 

appropriate WPI inflator. See Surrogate 

Value Memorandum. 

To value marine insurance, the 

Department used data from RGJ 

Consultants (http:// 

www.rjgconsultants.com/). This source 

provides information regarding the pervalue rates of marine insurance of 

imports and exports to/from various 

countries. 

We calculated factory overhead, 

selling general and administrative 

expenses (‘‘SG&A’’), and profit 

percentages for TPCO using the 

financial statements of Tata Steel 

Limited (‘‘Tata’’) as of March 31, 2009, 

because Tata is a producer of 

comparable merchandise, and is at a 

level of integration much more similar 

to TPCO’s than the other surrogate 

company for whom we have usable 

financial statements: Oil Country 

Tubular Ltd. (‘‘OCTL’’). We used the 

financial statements of OCTL as of 

March 31, 2009, to value factory 

overhead, SG&A and profit for 

Changbao because OCTL, like 

Changbao, is a non-integrated producer 

of identical and comparable 

merchandise. Both financial statements 

are contemporaneous with the POI. The 

Department may consider other publicly 

available financial statements for the 

final determination, as appropriate. 

Regarding surrogate values for steel 

billets, Petitioners argue that the 

Department should use HTS 7207.20.30 

to value TPCO’s and Changbao’s 

reported steel billets. The HTS category 

subheading 7207.20.30 encompasses 

‘‘seamless tube’’, semi-finished steel 

products, with a carbon content greater 

than or equal to 20 percent. According 

to the Petitioners, these steel billets, 

what Petitioners refer to as ‘‘commodity 

grade’’ steel billets, have more exacting 

physical and chemical requirements 

than standard steel billets. Petitioners 

argue that OCTG production requires 

the use of this premium steel billet (e.g., 

with a carbon content greater than or 

equal to 20 percent) and that therefore, 

the appropriate HTS for TPCO and 

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Federal Register / Vol. 74, No. 220 / Tuesday, November 17, 2009 / Notices 59129 

60See Petitioner’s September 14, 2009, Surrogate 

Value Submission. 

61See Petitioner’s September 21, 2009, Surrogate 

Value Rebuttal Submission. 

62 Id. 

63See Petitioners’ Letter to the Department: 

Certain Oil Country Tubular Goods from the 

People’s Republic of China: Request that the 

Department Collect Additional Data from the 

Respondents (May 22, 2009). 

64See 19 CFR 351.414(d)(3): Time period over 

which weighted average is calculated. When 

applying the average-to-average method, the 

Secretary normally will calculate weighted averages 

for the entire period of investigation or review, as 

the case may be. However, when normal values, 

export prices, or constructed export prices differ 

significantly over the course of the period of 

investigation or review, the Secretary may calculate 

weighted averages for such shorter period as the 

Secretary deems appropriate. 

65See, e.g., Stainless Steel Plate in Coils From 

Belgium: Final Results of Antidumping Duty 

Administrative Review, 73 FR 75398 (December 11, 

2008) and accompanying Issues and Decision 

Memorandum at Comment 4. 

Changbao’s steel billets is 7207.20.30.60

Petitioners also argue that 7207.20.30 is 

the appropriate HTS subheading as 

TPCO’s and Changbao’s subject 

merchandise is ‘‘seamless OCTG’’ which 

requires ‘‘seamless tube’’ steel billets.61

Changbao argues that the steel billets 

it uses to produce the subject 

merchandise are non-alloy and contain 

less than 25 percent carbon content. 

Changbao has provided technical 

specifications purporting to demonstrate 

this. Accordingly, Changbao argues that 

the proper HTS is 7224.90.91, as its 

steel billets are excluded from the HTS 

7207.20.30 subheading and are, rather, 

comprised of the characteristics more 

appropriately encompassed by HTS 

subheading 7224.90.91. 

TPCO, in its surrogate value 

submission, suggested 7207.20.90 as the 

appropriate HTS subheading for the 

steel billets purchased and used for 

producing its subject merchandise. 

Petitioners argue that, although TPCO’s 

suggested HTS subheading encompasses 

the ‘‘carbon content greater than or 

equal to 20 percent’’ characteristic, it 

nonetheless falls into the ‘‘other’’ group 

and is thus less specific than 

7207.20.30. Finally, Petitioners point 

out that both HTS subheadings 

suggested by TPCO and Changbao are 

basket category subheadings.62

We preliminarily determine to value 

both Changbao’s and TPCO’s billets 

with the HTS number proffered by each 

respondent, respectively (i.e., HTS is 

7224.90.91 for Changbao and HTS 

7207.20.90 for TPCO). Changbao and 

TPCO are the parties with access to their 

respective technical specifications and 

mill test certifications, and so have 

access to the most specific information 

possible to correctly determine the 

surrogate value most specific to their 

own billets. Accordingly, we 

preliminarily determine to use TPCO 

and Changbao’s respective HTS 

subheading suggestions, but intend to 

pursue this issue at verification. 

Shorter Cost Averaging Periods 

On May 22, 2009, Petitioners, using 

data from business proprietary sources, 

alleged that OCTG prices, and the cost 

of raw material inputs used to produce 

subject merchandise, decreased 

dramatically during the POI.63

Petitioners claimed that in similar 

instances in other cases, the Department 

has used shorter cost-averaging periods 

when calculating normal value (i.e., the 

Department calculated cost of 

production or constructed values on a 

quarterly basis for comparison to sales 

prices, rather than using a POI or period 

of review (POR) average).64

Accordingly, Petitioners requested that 

the Department require respondents to 

report their material input usage rates 

on a monthly basis for both the POI and 

the six months preceding the POI. They 

also requested that the Department 

calculate normal value using monthly 

consumption periods and monthly 

surrogate values rather than a POIaverage of inputs and surrogate values. 

To date, the Department has not 

considered using shorter cost periods in 

an NME case. The Department has used 

shorter cost periods in market-economy 

(‘‘ME’’) cases where we determined that 

actual production costs changed 

significantly during the POI/POR, and 

where there was evidence of a linkage 

between the actual cost changes and the 

sales prices in a given POI/POR.65 In an 

NME context, except in limited 

circumstances when inputs are 

purchased from market-economy 

suppliers, the Department calculates 

normal value using surrogate values in 

lieu of actual input costs. Thus, because 

the use of the shorter cost periods 

would not more accurately reflect 

experience of the respondent operating 

in the NME during the period under 

examination, we continue to base costs 

on POI-average surrogate values rather 

than the shorter cost periods. 

Because it is not clear how the shorter 

cost averaging period methodology 

employed in ME cases can fit 

methodologically or analytically in an 

NME context, we preliminarily continue 

to base normal value on the POI average 

surrogate values and input consumption 

rates, rather than shorter cost periods, 

for this investigation. We invite parties 

to comment on these issues and on what 

facts warrant the use of shorter cost 

averaging periods in this case, for the 

final determination. 

Currency Conversion 

We made currency conversions into 

U.S. dollars, in accordance with section 

773A(a) of the Act, based on the 

exchange rates in effect on the dates of 

the U.S. sales as certified by the Federal 

Reserve Bank. 

Verification 

As provided in section 782(i)(1) of the 

Act, we intend to verify the information 

upon which we will rely in making our 

final determination. 

Combination Rates 

In the Initiation Notice, the 

Department stated that it would 

calculate combination rates for certain 

respondents that are eligible for a 

separate rate in this investigation. See 

Initiation Notice, 74 FR 20676. This 

practice is described in Policy Bulletin 

05.1, available at http://ia.ita.doc.gov/. 

Preliminary Determination 

The weighted-average dumping 

margins are as follows: 

Exporter Producer 

Weightedaverage 

margin 

Jiangsu Changbao Steel Tube Co., Ltd ..................................... Jiangsu Changbao Steel Tube Co., Ltd. and Jiangsu 

Changbao Precision Steel Tube Co., Ltd.

0.00 

Tianjin Pipe International Economic and Trading Corporation ... Tianjin Pipe (Group) Corporation ............................................... 36.53 

Angang Group Hong Kong Co., Ltd ........................................... Angang Steel Co. Ltd ................................................................ 36.53 

Angang Steel Co., Ltd., and Angang Group International Trade 

Corporation.

Angang Steel Co. Ltd ................................................................ 36.53 

Anhui Tianda Oil Pipe Co., Ltd ................................................... Anhui Tianda Oil Pipe Co., Ltd .................................................. 36.53 

Anshan Zhongyou Tipo Pipe & Tubing Co., Ltd ........................ Anshan Zhongyou Tipo Pipe & Tubing Co., Ltd ....................... 36.53 

Baotou Steel International Economic and Trading Co., Ltd ....... Baotou Steel International Economic and Trading Co., Ltd ...... 36.53 

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59130 Federal Register / Vol. 74, No. 220 / Tuesday, November 17, 2009 / Notices 

Exporter Producer 

Weightedaverage 

margin 

Benxi Northern Steel Pipes Co., Ltd .......................................... Benxi Northern Steel Pipes Co., Ltd ......................................... 36.53 

Chengdu Wanghui Petroleum Pipe Co. Ltd ............................... Chengdu Wanghui Petroleum Pipe Co. Ltd .............................. 36.53 

Dalipal Pipe Company ................................................................ Dalipal Pipe Company ............................................................... 36.53 

Faray Petroleum Steel Pipe Co. Ltd ........................................... Faray Petroleum Steel Pipe Co. Ltd .......................................... 36.53 

Freet Petroleum Equipment Co., Ltd. of Shengli Oil Field, The 

Thermal Recovery Equipment, Zibo Branch.

Freet Petroleum Equipment Co., Ltd. of Shengli Oil Field, The 

Thermal Recovery Equipment, Zibo Branch.

36.53 

Hengyang Steel Tube Group International Trading, Inc ............ Hengyang Valin MPM Tube Co., Ltd.; Hengyang Valin Steel 

Tube Co., Ltd.

36.53 

Huludao Steel Pipe Industrial Co., Ltd./Huludao City Steel Pipe 

Industrial Co., Ltd.

Huludao Steel Pipe Industrial Co., Ltd./Huludao City Steel 

Pipe Industrial Co., Ltd.

36.53 

Jiangsu Chengde Steel Tube Share Co., Ltd ............................ Jiangsu Chengde Steel Tube Share Co., Ltd ........................... 36.53 

Jiangyin City Changjiang Steel Pipe Co., Ltd ............................ Jiangyin City Changjiang Steel Pipe Co., Ltd ........................... 36.53 

Pangang Group Beihai Steel Pipe Corporation .......................... Pangang Group Beihai Steel Pipe Corporation ......................... 36.53 

Pangang Group Chengdu Iron & Steel ...................................... Pangang Group Chengdu Iron & Steel ..................................... 36.53 

Qingdao Bonded Logistics Park Products International Trading 

Co., Ltd.

Shengli Oilfield Highland Petroleum Equipment Co., Ltd.; 

Shandong Continental Petroleum Equipment Co., Ltd.; Aofei 

Tele Dongying Import & Export Co., Ltd.; Highgrade Tubular 

Manufacturing (Tianjin) Co., Ltd.; Cangzhou City Baohai Petroleum Material Co., Ltd.

36.53 

Qiqihaer Bonded Logistics Park Products International Trading 

Co., Ltd.

Qiqihaer Bonded Logistics Park Products International Trading 

Co., Ltd.

36.53 

Shandong Dongbao Steel Pipe Co., Ltd .................................... Shandong Dongbao Steel Pipe Co., Ltd ................................... 36.53 

ShanDong HuaBao Steel Pipe Co., Ltd ..................................... ShanDong HuaBao Steel Pipe Co., Ltd .................................... 36.53 

Shandong Molong Petroleum Machinery Co., Ltd ..................... Shandong Molong Petroleum Machinery Co., Ltd .................... 36.53 

Shanghai Metals & Minerals Import & Export Corp./Shanghai 

Minmetals Materials & Products Corp.

Jiangsu Changbao Steel Pipe Co., Ltd.; Huludao Steel Pipe 

Industrial Co., Ltd.; Northeast Special Steel Group Qiqihaer 

Haoying Steel and Iron Co., Ltd.; Beijing Youlu Co., Ltd.

36.53 

Shanghai Zhongyou Tipo Steel Pipe Co., Ltd ............................ Shanghai Zhongyou Tipo Steel Pipe Co., Ltd ........................... 36.53 

Shengli Oil Field Freet Petroleum Equipment Co., Ltd .............. Freet Petroleum Equipment Co., Ltd. of Shengli Oil Field, The

Thermal Recovery Equipment, Zibo Branch; Faray Petroleum Steel Pipe Co., Ltd.; Shengli Oil Field Freet Petroleum 

Steel Pipe Co., Ltd.

36.53 

Shengli Oil Field Freet Petroleum Steel Pipe Co., Ltd ............... Freet Petroleum Equipment Co., Ltd. of Shengli Oil Field, The 

Thermal Recovery Equipment, Zibo Branch; Tianda Oil Pipe 

Co., Ltd; Wuxi Fastube Dingyuan Precision Steel Pipe Co., 

Ltd.

36.53 

Shengli Oilfield Highland Petroleum Equipment Co., Ltd ........... Tianjin Pipe Group Corp.; Goods & Materials Supply Dept. of 

Shengli Oilfield SinoPEC; Dagang Oilfield Group New Century Machinery Co. Ltd.; Tianjin Seamless Steel Pipe Plant; 

Baoshan Iron & Steel Co. Ltd.

36.53 

Shengli Oilfield Shengji Petroleum Equipment Co., Ltd ............. Shengli Oilfield Shengji Petroleum Equipment Co., Ltd. ........... 36.53 

Tianjin Xingyuda Import and Export Co., Ltd. & Hong Kong 

Gallant Group Limited.

Tianjin Lifengyuanda Steel Group Co., Ltd ............................... 36.53 

Tianjin Seamless Steel Pipe Plant ............................................. Tianjin Seamless Steel Pipe Plant ............................................ 36.53 

Tianjin Tiangang Special Petroleum Pipe Manufacturer Co., 

Ltd.

Tianjin Tiangang Special Petroleum Pipe Manufacturer Co., 

Ltd.

36.53 

Wuxi Baoda Petroleum Special Pipe Manufacturing Co., Ltd .... Wuxi Baoda Petroleum Special Pipe Manufacturing Co., Ltd ... 36.53 

Wuxi Seamless Oil Pipe Co., Ltd ............................................... Wuxi Seamless Oil Pipe Co., Ltd .............................................. 36.53 

Wuxi Sp. Steel Tube Manufacturing Co., Ltd ............................. Wuxi Precese Special Steel Co., Ltd ........................................ 36.53 

Wuxi Zhenda Special Steel Tube Manufacturing Co., Ltd ......... Huai’an Zhenda Steel Tube Manufacturing Co., Ltd ................. 36.53 

Xigang Seamless Steel Tube Co., Ltd ....................................... Xigang Seamless Steel Tube Co., Ltd.; Wuxi Seamless Special Pipe Co., Ltd.36.53 

Yangzhou Lontrin Steel Tube Co., Ltd ....................................... Yangzhou Lontrin Steel Tube Co., Ltd ...................................... 36.53 

Zhejiang Jianli Co., Ltd. & Zhejiang Jianli Steel Tube Co., Ltd Zhejiang Jianli Co., Ltd.; Zhejiang Jianli Steel Tube Co., Ltd ... 36.53 

PRC-wide Entity * ........................................................................ .................................................................................................... 99.14 

* Shengli Oil Field Freet Import & Export Trade Co., Ltd. is part of the PRC-wide entity. 

Disclosure 

We will disclose the calculations 

performed within five days of the date 

of publication of this notice to parties in 

this proceeding in accordance with 19 

CFR 351.224(b). 

Suspension of Liquidation 

In accordance with section 733(d) of 

the Act, we will instruct U.S. Customs 

and Border Protection (‘‘CBP’’) to 

suspend liquidation of all entries of 

subject merchandise exported by TPCO 

and produced by Tianjin Pipe (Group) 

Corporation, entered, or withdrawn 

from warehouse, for consumption on or 

after the date of publication of this 

notice in the Federal Register. We will 

instruct CBP to require a cash deposit or 

the posting of a bond equal to the 

weighted-average amount by which the 

NV exceeds U.S. price, as indicated 

above. 

Additionally, as the Department has 

determined in its Certain Oil Country 

Tubular Goods From the People’s 

Republic of China: Preliminary 

Affirmative Countervailing Duty 

Determination, Preliminary Negative 

Critical Circumstances Determination, 

74 FR 47210 (September 15, 2009) 

(‘‘CVD Prelim’’) that the merchandise 

under investigation, exported by TPCO, 

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Federal Register / Vol. 74, No. 220 / Tuesday, November 17, 2009 / Notices 59131 

benefitted from an export subsidy, we 

will instruct CBP to require an 

antidumping cash deposit or posting of 

a bond equal to the weighted-average 

amount by which the NV exceeds the 

U.S. price for TPCO, as indicated above, 

minus the amount determined to 

constitute an export subsidy. See, e.g., 

Notice of Final Determination of Sales 

at Less Than Fair Value: Carbazole 

Violet Pigment 23 From India, 69 FR 

67306, 67307 (November 17, 2007). 

We will instruct CBP not to suspend 

liquidation or require a cash deposit or 

the posting of a bond for imports of 

OCTG from the PRC exported and 

produced by Changbao, because we 

have calculated a margin of zero percent 

for Changbao. 

In accordance with section 733(d) of 

the Act, we will instruct CBP to suspend 

liquidation of all entries of subject 

merchandise exported by the separaterate respondents, in the exporter/ 

producer combination identified above, 

entered, or withdrawn from warehouse, 

for consumption on or after the date of 

publication of this notice in the Federal 

Register. We will instruct CBP to 

require a cash deposit or the posting of 

a bond equal to the weighted-average 

amount by which the NV exceeds U.S. 

price, as indicated above. 

For the two separate-rate companies 

in this investigation that also 

participated as mandatory respondents 

in the CVD investigation (i.e., Wuxi 

Seamless Oil Pipe Co., Ltd., and 

Zhejiang Jianli Co., Ltd. & Zhejiang 

Jianli Steel Tube Co., Ltd.), because it 

was determined in the CVD Prelim. that 

these companies did not benefit from 

any export subsidy, we will not make an 

adjustment to the antidumping duty rate 

of these companies for purposes of cash 

deposits. 

For the remaining separate-rate 

companies, we will instruct CBP to 

adjust the dumping margin by the 

amount of export subsidies included in 

the All Other rate from the CVD Prelim. 

Further, because we found critical 

circumstances with regard to the PRCwide entity, we will instruct CBP to 

suspend liquidation of merchandise 

under consideration exported by the 

PRC-wide entity and entered or 

withdrawn from warehouse, for 

consumption commencing 90 days prior 

to the date of this preliminary 

determination, and we will instruct CBP 

to require an antidumping duty cash 

deposit or the posting of a bond for each 

entry. 

These suspension of liquidation 

instructions will remain in effect until 

further notice. 

International Trade Commission 

Notification 

In accordance with section 733(f) of 

the Act, we have notified the ITC of our 

preliminary affirmative determination of 

sales at less than fair value. Section 

735(b)(2) of the Act requires the ITC to 

make its final determination as to 

whether the domestic industry in the 

United States is materially injured, or 

threatened with material injury, by 

reason of imports of certain OCTG, or 

sales (or the likelihood of sales) for 

importation, of the merchandise under 

investigation within 45 days of our final 

determination. 

Public Comment 

Case briefs or other written comments 

may be submitted to the Assistant 

Secretary for Import Administration no 

later than seven days after the date on 

which the final verification report is 

issued in this proceeding and rebuttal 

briefs limited to issues raised in case 

briefs and must be received no later 

than five days after the deadline date for 

case briefs. See 19 CFR 351.309(c)(i) and 

(d). A list of authorities used and an 

executive summary of issues should 

accompany any briefs submitted to the 

Department. This summary should be 

limited to five pages total, including 

footnotes. 

In accordance with section 774 of the 

Act, and if requested, we will hold a 

public hearing, to afford interested 

parties an opportunity to comment on 

arguments raised in case or rebuttal 

briefs. If a request for a hearing is made, 

we intend to hold the hearing shortly 

after the deadline of submission of 

rebuttal briefs at the U.S. Department of 

Commerce, 14th Street and Constitution 

Ave., NW., Washington, DC 20230, at a 

time and location to be determined. 

Parties should confirm by telephone the 

date, time, and location of the hearing 

two days before the scheduled date. 

Interested parties who wish to request 

a hearing, or to participate if one is 

requested, must submit a written 

request to the Assistant Secretary for 

Import Administration, U.S. Department 

of Commerce, Room 1870, within 30 

days after the date of publication of this 

notice. See 19 CFR 351.310(c). Requests 

should contain the party’s name, 

address, and telephone number, the 

number of participants, and a list of the 

issues to be discussed. At the hearing, 

each party may make an affirmative 

presentation only on issues raised in 

that party’s case brief and may make 

rebuttal presentations only on 

arguments included in that party’s 

rebuttal brief. 

This determination is issued and 

published in accordance with sections 

733(f) and 777(i)(1) of the Act. 

Dated: November 4, 2009. 

Ronald K. Lorentzen, 

Acting Assistant Secretary for Import 

Administration. 

[FR Doc. E9–27574 Filed 11–16–09; 8:45 am] 

BILLING CODE 3510–DS–P 

DEPARTMENT OF COMMERCE 

Foreign–Trade Zones Board 

Docket 48–2009 

Foreign–Trade Zone 89 - Las Vegas, Nevada 

Application for Expansion 

An application has been submitted to 

the Foreign–Trade Zones Board (the 

Board) by the Nevada Development 

Authority, grantee of Foreign–Trade 

Zone 89, requesting authority to expand 

its zone to include a site in the City of 

North Las Vegas, Nevada. The 

application was submitted pursuant to 

the provisions of the Foreign–Trade 

Zones Act, as amended (19 U.S.C. 81a– 

81u), and the regulations of the Board 

(15 CFR Part 400). It was formally filed 

on November 9, 2009. 

FTZ 89 was approved by the Board on 

November 7, 1983 (Board Order 227, 48 

FR 51665, 11/10/83) and expanded on 

December 4, 1989 (Board Order 452, 54 

FR 50787, 12/11/89) and March 11, 

1994 (Board Order 688, 59 FR 12893, 3/ 

18/94). The general–purpose zone 

currently consists of six sites in the Las 

Vegas, Nevada area: Site 1: (23 acres) -- 

Las Vegas Convention Center, Clark 

County; Site 3: (two parcels, 317 acres 

and 120,000 sq. ft.) -- within the Hughes 

Airport Center Industrial Park, adjacent 

to McCarran International Airport; Site 

4: (37 acres) -- North Las Vegas Business 

Center, North Las Vegas; Site 5: (516 

acres) -- AMPAC Development 

Company - Gibson Business Park, Clark 

County; Site 6: (160 acres) -- Las Vegas 

International Air Cargo Center at 

McCarran International Airport, Clark 

County; and, Site 7: World Jewelry 

Center, Union Park Center, Las Vegas, 

Nevada. 

The applicant is requesting authority 

to expand the zone to include a new site 

in the City of North Las Vegas (Clark 

County): Proposed Site 8 (365 acres) the 

City View Business Park located west of 

the intersection of Interstate 15 and 

State Road 604. The site will provide 

warehousing and distribution services 

to area businesses. No specific 

manufacturing authority is being 

requested at this time. Such requests 

would be made to the Board on a case– 

by-case basis. 

mstockstill on DSKH9S0YB1PROD with NOTICES


This section of the FEDERAL REGISTER

contains documents other than rules or

proposed rules that are applicable to the

public. Notices of hearings and investigations,

committee meetings, agency decisions and

rulings, delegations of authority, filing of

petitions and applications and agency

statements of organization and functions are

examples of documents appearing in this

section.

Notices Federal Register

64045 

Vol. 74, No. 233 

Monday, December 7, 2009 

DEPARTMENT OF COMMERCE 

National Oceanic and Atmospheric 

Administration 

Evaluation of State Coastal 

Management Programs and National 

Estuarine Research Reserves 

AGENCY: National Oceanic and 

Atmospheric Administration (NOAA), 

Office of Ocean and Coastal Resource 

Management, National Ocean Service, 

Commerce. 

ACTION: Notice of intent to evaluate and 

notice of availability of final findings. 

SUMMARY: The NOAA Office of Ocean 

and Coastal Resource Management 

(OCRM) announces its intent to evaluate 

the performance of the Rhode Island 

Coastal Resources Management 

Program. 

The Coastal Zone Management 

Program evaluation will be conducted 

pursuant to section 312 of the Coastal 

Zone Management Act of 1972, as 

amended (CZMA) and regulations at 15 

CFR Part 923, Subpart L. The CZMA 

requires continuing review of the 

performance of States with respect to 

coastal program implementation. 

Evaluation of a Coastal Management 

Program requires findings concerning 

the extent to which a State has met the 

national objectives, adhered to its 

Coastal Management Program document 

approved by the Secretary of Commerce, 

and adhered to the terms of financial 

assistance awards funded under the 

CZMA. 

Each evaluation will include a site 

visit, consideration of public comments, 

and consultations with interested 

Federal, State, and local agencies and 

members of the public. A public 

meeting will be held as part of the site 

visit. When the evaluation is completed, 

OCRM will place a notice in the Federal 

Register announcing the availability of 

the Final Evaluation Findings. Notice is 

hereby given of the date of the site visit 

for the listed evaluation, and the date, 

local time, and location of the public 

meeting during the site visit. 

Dates and Times: The Rhode Island 

Coastal Resources Management Program 

evaluation site visit will be held January 

25–29, 2010. One public meeting will be 

held during the week. The public 

meeting will be held on Wednesday, 

January 27, 2010, at 6 p.m. at the Rhode 

Island Department of Administration, 

Conference Room A, One Capitol Hill, 

Providence, Rhode Island. 

ADDRESSES: Copies of States’ most 

recent performance reports, as well as 

OCRM’s evaluation notification and 

supplemental information request 

letters to the State, are available upon 

request from OCRM. Written comments 

from interested parties regarding this 

Program are encouraged and will be 

accepted until 15 days after the public 

meeting. Please direct written comments 

to Kate Barba, Chief, National Policy 

and Evaluation Division, Office of 

Ocean and Coastal Resource 

Management, NOS/NOAA, 1305 EastWest Highway, 10th Floor, N/ORM7, 

Silver Spring, Maryland 20910. 

SUPPLEMENTARY INFORMATION: Notice is 

hereby given of the availability of the 

final evaluation findings for Minnesota’s 

Lake Superior Coastal Program and the 

Narragansett Bay (Rhode Island) and 

Kachemak Bay (Alaska) National 

Estuarine Research Reserves (NERRs). 

Sections 312 and 315 of the Coastal 

Zone Management Act of 1972 (CZMA), 

as amended, require a continuing 

review of the performance of coastal 

States with respect to approval of CMPs 

and the operation and management of 

NERRs. 

The State of Minnesota was found to 

be implementing and enforcing its 

Federally approved coastal management 

program, addressing the national coastal 

management objectives identified in 

CZMA Section 303(2)(A)–(K), and 

adhering to the programmatic terms of 

their financial assistance awards. The 

Narragansett Bay and Kachemak Bay 

NERRs were found to be adhering to 

programmatic requirements of the NERR 

System. 

Copies of these final evaluation 

findings may be obtained upon written 

request from: Kate Barba, Chief, 

National Policy and Evaluation 

Division, Office of Ocean and Coastal 

Resource Management, NOS/NOAA, 

1305 East-West Highway, 10th Floor, N/ 

ORM7, Silver Spring, Maryland 20910, 

or Kate.Barba@noaa.gov. 

FOR FURTHER INFORMATION CONTACT: Kate 

Barba, Chief, National Policy and 

Evaluation Division, Office of Ocean 

and Coastal Resource Management, 

NOS/NOAA, 1305 East-West Highway, 

10th Floor, N/ORM7, Silver Spring, 

Maryland 20910, (301) 563–1182. 

Dated: November 20, 2009. 

Donna Wieting, 

Acting Director, Office of Ocean and Coastal 

Resource Management, National Ocean 

Service, National Oceanic and Atmospheric 

Administration. 

Federal Domestic Assistance Catalog 11.419. 

Coastal Zone Management Program 

Administration. 

[FR Doc. E9–29055 Filed 12–4–09; 8:45 am] 

BILLING CODE 3510–08–P

DEPARTMENT OF COMMERCE 

International Trade Administration 

[C–570–944] 

Certain Oil Country Tubular Goods 

From the People’s Republic of China: 

Final Affirmative Countervailing Duty 

Determination, Final Negative Critical 

Circumstances Determination 

AGENCY: Import Administration, 

International Trade Administration, 

Department of Commerce. 

SUMMARY: The Department of Commerce 

(the ‘‘Department’’) has determined that 

countervailable subsidies are being 

provided to producers and exporters of 

certain oil country tubular goods from 

the People’s Republic of China (‘‘PRC’’). 

For information on the estimated 

countervailing duty rates, please see the 

‘‘Suspension of Liquidation’’ section, 

below. 

DATES: Effective Date: December 7, 2009. 

FOR FURTHER INFORMATION CONTACT: 

David Neubacher, Shane Subler, Magd 

Zalok, Maryanne Burke, and Henry 

Almond, AD/CVD Operations, Office 1, 

Import Administration, International 

Trade Administration, U.S. Department 

of Commerce, 14th Street and 

Constitution Avenue, NW., Washington, 

DC 20230; telephone: (202) 482–5823, 

(202) 482–0189, (202) 482–4162, (202) 

482–5604, and (202) 482–0049, 

respectively. 


erowe on DSK5CLS3C1PROD with NOTICES
64046 Federal Register / Vol. 74, No. 233 / Monday, December 7, 2009 / Notices 

Petitioner 

Petitioners in this investigation are 

Maverick Tube Corporation, United 

States Steel Corporation, TMK IPSCO, 

V&M Star LP, Wheatland Tube 

Corporation, Evraz Rocky Mountain 

Steel, and United Steel, Paper and 

Forestry, Rubber, Manufacturing, 

Energy, Allied Industrial and Service 

Workers International Union, AFL–CIO– 

CLC (‘‘United Steelworkers’’) 

(collectively, ‘‘Petitioners’’). 

Period of Investigation 

The period for which we are 

measuring subsidies, or period of 

investigation, is January 1, 2008, 

through December 31, 2008. 

Case History 

The following events have occurred 

since the announcement of the 

preliminary determination published in 

the Federal Register on September 15, 

2009. See Certain Oil Country Tubular 

Goods From the People’s Republic of 

China: Preliminary Affirmative 

Countervailing Duty Determination, 

Preliminary Negative Critical 

Circumstances Determination, 74 FR 

47210 (September 15, 2009) 

(‘‘Preliminary Determination’’). 

On September 16, 2009, the 

Department issued a letter to Jiangsu 

Changbao Steel Tube Co., Ltd. 

(‘‘Changbao Steel’’), Tianjin Pipe 

(Group) Co. (‘‘TPCO’’), Wuxi Seamless 

Oil Pipe Co., Ltd. (‘‘WSP’’), Zhejiang 

Jianli Enterprise Co., Ltd. (‘‘Jianli’’), and 

the Government of China (‘‘GOC’’) 

setting September 21, 2009 as the 

deadline for responses to questions in 

the June 4, 2009 original questionnaire 

and subsequent supplemental 

questionnaires. We received 

submissions from the above-mentioned 

mandatory respondents and the GOC on 

September 21, 2009. The Department 

also issued supplemental questionnaires 

to TPCO on September 23, 2009. We 

received a response from TPCO on 

September 29, 2009. 

On September 28, 2009, Changbao 

Steel submitted ministerial error 

allegations in regard to the Preliminary 

Determination. On October 21, 2009, we 

issued our finding that none of the 

ministerial errors alleged by the parties 

constituted a significant ministerial 

error, as defined by 19 CFR 351.224(f) 

and 19 CFR 351.224(g) to 19 CFR 351, 

and did not amend the Preliminary 

Determination. 

On September 18, 2009, the 

Department determined that petitioners 

had provided sufficient support to 

investigate certain new subsidy 

allegations, dated July 30, 2009. See 

Memorandum to Susan H. Kuhbach, 

Office Director, AD/CVD Operations, 

Office 1, entitled ‘‘New Subsidy 

Allegations’’ (September 18, 2009). On 

October 21, 2009, the Department 

postponed its investigation of those 

newly alleged subsidies until the first 

administrative review (should this 

investigation result in a countervailing 

duty order). See Memorandum to Susan 

H. Kuhbach, Office Director, AD/CVD 

Operations, Office 1, entitled ‘‘Status of 

New Subsidies’’ (October 21, 2009). 

From October 12, 2009 to October 16, 

2009, we conducted verification of the 

questionnaire responses submitted by 

GOC, Changbao Steel, TPCO, WSP, and 

Jianli. See Memorandum from Shane 

Subler and David Neubacher, 

International Trade Compliance 

Analysts, to Susan H. Kuhbach, Office 

Director, AD/CVD Operations, Office 1, 

entitled ‘‘Verification Report of the 

Jiangsu Province State Administration 

of Industry and Commerce and Tianjin 

Municipality State Administration of 

Industry and Commerce’’ (October 29, 

2009); Memorandum from David 

Neubacher, Magd Zalok, and Maryanne 

Burke, International Trade Compliance 

Analysts, to Susan H. Kuhbach, Office 

Director, AD/CVD Operations, Office 1, 

entitled ‘‘Jiangsu Changbao Steel Tube 

Co., Ltd. and Jiangsu Changbao 

Precision Steel Tube Co., Ltd. 

Verification Report’’ (October 29, 2009); 

Memorandum from Shane Subler and 

David Layton, International Trade 

Compliance Analysts, to Susan H. 

Kuhbach, Office Director, AD/CVD 

Operations, Office 1, entitled 

‘‘Verification Report: Tianjin Pipe 

(Group) Corporation (‘‘TPCO Group’’), 

Tianjin Pipe Iron Manufacturing Co., 

Ltd. (‘‘TPCO Iron’’), Tianguan Yuantong 

Pipe Product Co., Ltd. (‘‘Yuantong’’), 

Tianjin Pipe International Economic 

and Trading Co., Ltd. (‘‘TPCO 

International’’), and TPCO Charging 

Development Co., Ltd. (‘‘Charging’’) 

(collectively, ‘‘TPCO’’)’’ (October 29, 

2009) (‘‘TPCO Verification Report’’) ; 

Memorandum from Maryanne Burke, 

Magd Zalok, and David Neubacher, 

International Trade Compliance 

Analysts, to Susan H. Kuhbach, Office 

Director, AD/CVD Operations, Office 1, 

entitled ‘‘Wuxi Seamless Oil Pipe Co., 

Ltd., Jiangsu Fanli Steel Pipe Co., Ltd., 

and Mengfeng Special Steel Co., Ltd. 

Verification Report’’ (October 29, 2009) 

(‘‘WSP Verification Report’’); and 

Memorandum from Scott Holland and 

Henry Almond, International Trade 

Compliance Analysts, to Susan H. 

Kuhbach, Office Director, AD/CVD 

Operations, Office 1, entitled 

‘‘Verification Report: Jianli Group’’ 

(October 28, 2009). 

We received case briefs from the GOC, 

Changbao, TPCO, WSP, Jianli and 

Petitioners (separately filed by Maverick 

Tube Corporation, United States Steel 

Corporation, and TMK IPSCO, V&M Star 

LP, Wheatland Tube Corporation, Evraz 

Rocky Mountain Steel, and United 

Steelworkers) on November 9, 2009. The 

same parties submitted rebuttal briefs 

on November 16, 2009. 

The Department placed information 

on the record of this investigation on 

November 12, 2009 regarding electricity 

rates. The GOC filed comments on this 

information on November 16, 2009 and 

the United States Steel Corporation filed 

rebuttal comments on November 17, 

2009. 

TPCO, Maverick Tube Corporation, 

and United States Steel Corporation 

requested a hearing. The same parties 

later withdrew their requests. Therefore, 

no hearing was held. 

Scope of the Investigation 

The scope of this investigation 

consists of OCTG, which 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, regardless of end finish (e.g., 

whether or not plain end, threaded, or 

threaded and coupled) whether or not 

conforming to American Petroleum 

Institute (‘‘API’’) or non-API 

specifications, whether finished 

(including limited service OCTG 

products) or unfinished (including 

green tubes and limited service OCTG 

products), whether or not thread 

protectors are attached. The scope of the 

investigation also covers OCTG 

coupling stock. Excluded from the scope 

of the investigation are: Casing or tubing 

containing 10.5 percent or more by 

weight of chromium; drill pipe; 

unattached couplings; and unattached 

thread protectors. 

The merchandise subject to this 

investigation is 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, 

7304.29.31.10, 7304.29.31.20, 

7304.29.31.30, 7304.29.31.40, 

7304.29.31.50, 7304.29.31.60, 

7304.29.31.80, 7304.29.41.10, 

7304.29.41.20, 7304.29.41.30, 

7304.29.41.40, 7304.29.41.50, 

7304.29.41.60, 7304.29.41.80, 


erowe on DSK5CLS3C1PROD with NOTICES
Federal Register / Vol. 74, No. 233 / Monday, December 7, 2009 / Notices 64047 

7304.29.50.15, 7304.29.50.30, 

7304.29.50.45, 7304.29.50.60, 

7304.29.50.75, 7304.29.61.15, 

7304.29.61.30, 7304.29.61.45, 

7304.29.61.60, 7304.29.61.75, 

7305.20.20.00, 7305.20.40.00, 

7305.20.60.00, 7305.20.80.00, 

7306.29.10.30, 7306.29.10.90, 

7306.29.20.00, 7306.29.31.00, 

7306.29.41.00, 7306.29.60.10, 

7306.29.60.50, 7306.29.81.10, and 

7306.29.81.50. 

The OCTG coupling stock covered by 

the investigation may also enter under 

the following HTSUS item numbers: 

7304.39.00.24, 7304.39.00.28, 

7304.39.00.32, 7304.39.00.36, 

7304.39.00.40, 7304.39.00.44, 

7304.39.00.48, 7304.39.00.52, 

7304.39.00.56, 7304.39.00.62, 

7304.39.00.68, 7304.39.00.72, 

7304.39.00.76, 7304.39.00.80, 

7304.59.60.00,, 7304.59.80.15, 

7304.59.80.20, 7304.59.80.25, 

7304.59.80.30, 7304.59.80.35, 

7304.59.80.40, 7304.59.80.45, 

7304.59.80.50, 7304.59.80.55, 

7304.59.80.60, 7304.59.80.65, 

7304.59.80.70, and 7304.59.80.80. 

The HTSUS subheadings are provided 

for convenience and customs purposes 

only, the written description of the 

scope of this investigation is dispositive. 

Injury Test 

Because the PRC is a ‘‘Subsidies 

Agreement Country’’ within the 

meaning of section 701(b) of the Tariff 

Act of 1930, as amended (the ‘‘Act’’), 

section 701(a)(2) of the Act applies to 

this investigation. Accordingly, the ITC 

must determine whether imports of the 

subject merchandise from the PRC 

materially injure, or threaten material 

injury to a U.S. industry. On June 10, 

2009, the U.S. International Trade 

Commission (‘‘ITC’’) issued its 

affirmative preliminary determination 

that there is a reasonable indication that 

an industry in the United States is 

materially injured by reason of allegedly 

subsidized imports of certain oil 

country tubular goods from the PRC. See 

Certain Oil Country Tubular Goods from 

China; Determinations, 74 FR 27559 

(June 10, 2009) and Certain Oil Country 

Tubular Goods from China: 

Investigation Nos. 701–TA–463 and 

731–TA–1159 (Preliminary) (June 2009). 

Critical Circumstances 

In the Preliminary Determination, the 

Department concluded that critical 

circumstances did not exist with respect 

to imports of OCTG from the PRC, in 

accordance with 703(e)(1) of the Act, 

because, there have not been massive 

imports of the subject merchandise over 

a relatively short period. 

We have not received any information 

since the Preliminary Determination 

that would lead us to change our 

preliminary finding. Therefore, in 

accordance with 705(a)(2) of the Act, we 

continue to find that critical 

circumstances do not exist with respect 

to imports of subject merchandise from 

the PRC. 

Analysis of Comments Received 

All issues raised in the case and 

rebuttal briefs by parties to this 

investigation are addressed in the 

Memorandum from John M. Andersen, 

Acting Deputy Assistant Secretary for 

Antidumping and Countervailing Duty 

Operations, to Ronald K. Lorentzen, 

Acting Assistant Secretary for Import 

Administration, entitled ‘‘Issues and 

Decision Memorandum for the Final 

Determination in the Countervailing 

Duty Investigation of Certain Oil 

Country Tubular Goods from the 

People’s Republic of China’’ (November 

23, 2009) (hereafter ‘‘Decision 

Memorandum’’), which is hereby 

adopted by this notice. Attached to this 

notice as an Appendix is a list of the 

issues that parties have raised and to 

which we have responded in the 

Decision Memorandum. Parties can find 

a complete discussion of all issues 

raised in this investigation and the 

corresponding recommendations in this 

public memorandum, which is on file in 

the Central Records Unit, room 1117 in 

the main building of the Commerce 

Department. In addition, a complete 

version of the Decision Memorandum 

can be accessed directly on the Internet 

at http://ia.ita.doc.gov/frn/. The paper 

copy and electronic version of the 

Decision Memorandum are identical in 

content. 

Use of Adverse Facts Available 

For purposes of this final 

determination, we have continued to 

rely on facts available and to draw an 

adverse inference, in accordance with 

sections 776(a) and (b) of the Act, to 

determine that the GOC’s dominance of 

the market in the PRC for steel round 

billets results in significant distortion in 

that market. Consequently, we are not 

relying on domestic prices in the PRC in 

determining whether a benefit was 

conferred through the GOC’s provision 

of steel round billets to the mandatory 

respondents. Similarly, we have 

continued to apply AFA to determine 

that all of the steel round billets were 

provided by government authorities. 

In a departure from the Preliminary 

Determination, the Department now 

finds that the use of ‘‘facts otherwise 

available’’ is warranted with regard to 

the GOC’s provision of electricity to the 

mandatory respondents. The 

Department requested information 

regarding electricity in its August 11, 

2009 supplemental questionnaire. This 

information was not provided in the 

GOC’s August 26, 2009, supplemental 

questionnaire response or its September 

21, 2009, response. By not responding to 

our questionnaire, the GOC has failed to 

act to the best of its ability. Accordingly, 

we find that an adverse inference is 

warranted, pursuant to section 776(b) of 

the Act. Specifically, we find that the 

GOC’s provision of electricity 

constitutes a financial contribution 

within the meaning of section 771(5)(D) 

of the Act and is specific within the 

meaning of section 771(5A)(D)(iv) of the 

Act. We have also relied on an adverse 

inference in selecting a benchmark for 

determining the existence and amount 

of the benefit. 

The Department also now finds that 

the use of ‘‘facts otherwise available’’ is 

warranted with regard to certain loans 

provided to TPCO and WSP under the 

‘‘Policy Loans’’ program. In the 

Department’s June 4, 2009, original 

questionnaire at page III–6, we 

requested respondents to ‘‘report all 

loans to your company from Stateowned commercial banks or 

Government of the People’s Republic of 

China (GOC) policy banks that were 

outstanding during the POI.’’ The same 

request was again made of WSP, in our 

August 7, 2009, supplemental 

questionnaire. At verification, both 

companies notified the Department that 

certain loans were not reported. See 

WSP Verification report at 2 and TPCO 

Verification Report at 17. By failing to 

report these loans, these companies 

failed to act to the best of their ability. 

Accordingly, we find that an adverse 

inference is warranted, pursuant to 

section 776(b) of the Act in regard to 

these unreported loans. As adverse facts 

available, we are assigning the highest 

rate calculated for a loan subsidy 

program in a PRC countervailing duty 

proceeding to the unreported loans. 

This rate will be weight-averaged with 

the calculated rate of reported loans 

found countervailable under the ‘‘Policy 

Loans’’ program. 

For a full discussion of these issues, 

please see the Decision Memorandum, 

at ‘‘Use of Facts Otherwise Available 

and Adverse Facts Available.’’ 

Suspension of Liquidation 

In accordance with section 

705(c)(1)(B)(i)(I) of the Act, we have 

calculated individual rates for each 

producer/exporter of the subject 

merchandise individually investigated. 

Section 705(c)(5)(A)(i) of the Act states 

that for companies not investigated, we 


erowe on DSK5CLS3C1PROD with NOTICES
64048 Federal Register / Vol. 74, No. 233 / Monday, December 7, 2009 / Notices 

will determine an ‘‘all others’’ rate equal 

to the weighted-average countervailable 

subsidy rates established for exporters 

and producers individually 

investigated, excluding any zero and de 

minimis countervailable subsidy rates, 

and any rates determined entirely under 

section 776 of the Act. 

Exporter/manufacturer 

Net 

subsidy 

rate 

Jiangsu Changbao Steel Tube Co. 

and Jiangsu Changbao Precision 

Steel Tube Co., Ltd. 11.98 

Tianjin Pipe (Group) Co., Tianjin 

Pipe Iron Manufacturing Co., Ltd., 

Tianguan Yuantong Pipe Product 

Co., Ltd., Tianjin Pipe International Economic and Trading 

Co., Ltd., and TPCO Charging 

Development Co., Ltd. 10.36 

Wuxi Seamless Pipe Co., Ltd., 

Jiangsu Fanli Steel Pipe Co, Ltd., 

Tuoketuo County Mengfeng Special Steel Co., Ltd. 14.61 

Zhejiang Jianli Enterprise Co., Ltd., 

Zhejiang Jianli Steel Steel Tube 

Co., Ltd., Zhuji Jiansheng Machinery Co., Ltd., and Zhejiang Jianli 

Industry Group Co., Ltd. 15.78 

All Others .......................................... 13.20 

As a result of our Preliminary 

Determination, we instructed U.S. 

Customs and Border Protection (CBP) to 

suspend liquidation of all entries of 

OCTG from the PRC which were entered 

or withdrawn from warehouse, for 

consumption on or after September 15, 

2009, the date of the publication of the 

Preliminary Determination in the 

Federal Register and to collect 

countervailing duty deposits or bonds in 

the amount of the preliminary 

countervailing duty rates. 

In accordance with section 

705(c)(1)(C) of the Act, we are directing 

CBP to continue to suspend liquidation 

of all imports of the subject 

merchandise from the PRC that are 

entered, or withdrawn from warehouse, 

for consumption on or after the date of 

publication of this notice in the Federal 

Register. The suspension of liquidation 

instructions will remain in effect until 

further notice. We are also directing 

CBP to collect countervailing duty 

deposits or bonds at the rates described 

above. 

We will issue a countervailing duty 

order if the ITC issues a final affirmative 

injury determination. If the ITC 

determines that material injury, or 

threat of material injury, does not exist, 

this proceeding will be terminated and 

all deposits or securities posted as a 

result of the suspension of liquidation 

will be refunded or canceled. 

ITC Notification 

In accordance with section 705(d) of 

the Act, we will notify the ITC of our 

determination. In addition, we are 

making available to the ITC all nonprivileged and non-proprietary 

information related to this investigation. 

We will allow the ITC access to all 

privileged and business proprietary 

information in our files, provided the 

ITC confirms that it will not disclose 

such information, either publicly or 

under an APO, without the written 

consent of the Assistant Secretary for 

Import Administration. 

Return or Destruction of Proprietary 

Information 

In the event that the ITC issues a final 

negative injury determination, this 

notice will serve as the only reminder 

to parties subject to an administrative 

protective order (‘‘APO’’) of their 

responsibility concerning the 

destruction of proprietary information 

disclosed under APO in accordance 

with 19 CFR 351.305(a)(3). Timely 

written notification of the return/ 

destruction of APO materials or 

conversion to judicial protective order is 

hereby requested. Failure to comply 

with the regulations and terms of an 

APO is a violation which is subject to 

sanction. 

This determination is published 

pursuant to sections 705(d) and 777(i) of 

the Act. 

Dated: November 23, 2009. 

Carole A. Showers, 

Acting Deputy Assistant Secretary for Policy 

and Negotiations. 

APPENDIX 

List of Comments and Issues in the Decision 

Memorandum 

General Issues 

Comment 1 Application of CVD Law to the 

PRC 

Comment 2 Double Counting/Overlapping 

Remedies 

Comment 3 Cutoff Date for Identifying 

Subsidies 

Steel Rounds for LTAR 

Comment 4 Application of AFA in 

Preliminary Determination 

Comment 5 Application of AFA Regarding 

PRC Market for Steel Rounds 

Comment 6 Application of AFA Regarding 

Respondents’ Steel Rounds Suppliers 

Comment 7 Double-Bracketing of Certain 

Information 

Comment 8 Whether Government 

‘‘Authorities’’ Provided Steel Rounds to 

Respondents 

Comment 9 Treatment of Companies in 

Which the State Has a Majority Interest 

Comment 10 Steel Rounds Provided by 

Trading Companies 

Comment 11 Indirect Financial 

Contribution 

Comment 12 Whether the Provision of Steel 

Rounds is Specific 

Comment 13 Benchmark Issues 

Comment 14 Adequately Remunerated 

Transactions 

Provision of Land for LTAR 

Comment 15 Whether there is a Financial 

Contribution 

Comment 16 Whether to Use an In-country 

Benchmark 

Comment 17 Thai Benchmark Flaws 

Comment 18 Whether Land is Specific 

Comment 19 Provision of Land in the 

Tianjin Binhai New Area (‘‘TBNA’’) 

Government Policy Lending 

Comment 20 Whether Chinese Banks are 

Authorities 

Comment 21 Whether the Policy Loan 

Program is Specific 

Government Policy Lending Benchmarks 

Comment 22 Whether the Department 

Should Use an In-country Benchmark 

Comment 23 Whether the Regression is 

Statistically Valid 

Comment 24 Terms of Loan Rates in the 

IMF Data 

Comment 25 Whether Negative Real 

Interest Rates Should be Excluded from the 

Regression 

Comment 26 Whether Certain Countries’ 

Data Should be Removed From the IMF 

Data 

Comment 27 Whether the Long-Term and 

Discount Rate are Flawed 

Other Issues 

Comment 28 New Subsidy Allegations 

Comment 29 Export Restraints on Steel 

Rounds 

Comment 30 Provision of Electricity for 

Less Than Adequate Remuneration 

Comment 31 Critical Circumstances 

Comment 32 Export Restraints on Coke 

Comment 33 VAT Rebates 

Company-specific Issues 

Comment 34 Changbao Sales Denominator 

Comment 35 Whether the Department 

Should Investigate Non-Initiated Programs 

for Changbao 

Comment 36 Jianli Group Sales 

Comment 37 Jianli Group Clerical Errors 

Comment 38 Jianli Group Steel Rounds 

Data 

Comment 39 TPCO Group Sales 

Denominator 

Comment 40 TEDA Holding 

Comment 41 TPCO Group Clerical Error 

Comment 42 TPCO Group Accelerated 

Depreciation 

Comment 43 WSP Steel Rounds Data 

Comment 44 WSP Loans 

[FR Doc. E9–28779 Filed 12–4–09; 8:45 am] 

BILLING CODE 3510–DS–P 


erowe on DSK5CLS3C1PROD with NOTICES
APPENDIX B

HEARING WITNESSES

B-1

CALENDAR OF THE PUBLIC CONFERENCE

Those listed below appeared as witnesses at the United States International Trade Commission’s

hearing held in connection with the following investigations:

CERTAIN OIL COUNTRY TUBULAR GOODS (OCTG) FROM CHINA

Investigation Nos. 701-TA-463 and 731-TA-1159 (Final)

December 1, 2009 - 9:30 am

The hearing was held in Room 101 (Main Hearing Room) of the United States International

Trade Commission Building, 500 E Street, SW, Washington, DC.

UNITED STATES SENATE APPEARANCES:

The Honorable Arlen Specter, United States Senator, Pennsylvania

The Honorable Blanche L. Lincoln, United States Senator, Arkansas

The Honorable Sherrod C. Brown, United States Senator, Ohio

STATE GOVERNMENT APPEARANCE:

The Honorable Edward G. Rendell, Governor of Pennsylvania

The Honorable Ted Strickland, Governor of Ohio

U.S. HOUSE OF REPRESENTATIVE APPEARANCES:

The Honorable John P. Murtha, U.S. Representative, 12th District, Pennsylvania

The Honorable Peter J. Visclosky, U.S. Representative, 1st District, Indiana

The Honorable Dennis J. Kucinich, U.S. Representative, 10th District, Ohio

The Honorable Timothy F. Murphy, U.S. Representative, 18th District, Pennsylvania

The Honorable Timothy J. Ryan, U.S. Representative, 17th District, Ohio

The Honorable Jason Altmire, U.S. Representative, 4th District, Pennsylvania

The Honorable Betty Sutton, U.S. Representative, 13th District, Ohio

The Honorable Kathleen A. Dahlkemper, U.S. Representative, 3rd District, Pennsylvania

LOCAL GOVERNMENT OFFICIAL APPEARANCE:

The Honorable Jay Williams, Mayor of Youngstown, Ohio

B-3
IN SUPPORT OF THE IMPOSITION OF COUNTERVAILING/ANTIDUMPING DUTIES:

Schagrin Associates

Washington, D.C.

on behalf of

TMK IPSCO

Evraz Rocky Mountain Steel

V&M Star, L.P.

V&M TCA, LLC

Wheatland Tube Company

Northwest Pipe Company

United Steel Workers

Leo Gerard, President, United Steel, Paper and Forestry,

Rubber, Manufacturing, Energy, Allied Industrial

and Service Workers International Union, AFL-CIO-CLC

James Herald, Managing Director, V&M OCTG North America

Roger Lindgren, President, V&M Star

Michael Jardon, President, V&M USA Corporation

L. Scott Barnes, Senior Vice President & Chief

Commercial Officer, TMK IPSCO

William Kerins, President, Wheatland Tube

Ralph Boswell, Vice President for North American

Sales, Atlas Tube

Robert Simon, Vice President & General Manager,

Evraz Rocky Mountain Steel

Robert Okrzesik, Director of Seamless Sales, Evraz

Rocky Mountain Steel

Robert Mahoney, President of Tubular Products Group,

Northwest Pipe Company

Roger B. Schagrin )

 – OF COUNSEL John W. Bohn )

B-4
In Support of the Imposition of

 Antidumping and Countervailing Duty Orders (continued):

Skadden, Arps, Slate, Meagher & Flom LLP

Washington, DC

on behalf of

United States Steel Corporation (“U.S. Steel”)

John P. Surma, Chairman and Chief Executive

Officer, U.S. Steel

Douglas R. Matthews, Vice President, Tubular

Operations, U.S. Steel

George H. Thompson, General Manager, Commercial,

Tubular Products, United States Steel Tubular

Products, Inc.

Scott M. Dorn, General Manager, Tubular Marketing,

United States Steel Tubular Products, Inc.

William M. Buono, Manager, Market Analysis, Strategy 

Tubular Products, United States Steel Products, Inc.

John B. Shoaff, President, Sooner Pipe, LLC

Scott DuBois, President, Premier Pipe, L.P.

Steve Miller, Co-Chief Executive Officer, Cinco

Pipe and Supply, Inc.

Dr. Jerry A. Hausman, Professor of Economics, 

Massachusetts Institute of Technology

Dr. Seth T. Kaplan, Principal, The Brattle Group

Robert E. Lighthizer )

James C. Hecht )

 – OF COUNSEL Stephen P. Vaughn )

Stephen J. Narkin )

B-5
In Support of the Imposition of

 Antidumping and Countervailing Duty Orders (continued):

Wiley Rein LLP

Washington, DC

on behalf of

Maverick Tube Corporation

Germán Curá, President, Maverick Tube Corporation &

Managing Director North America, Tenaris S.A.

Roland Balkenende, President, Tenaris Global Services

(USA) (Maverick Sales Division in the United States)

Guillermo Vogel, Vice President, Finance, Board Member,

Tenaris S.A.

Dr. Jerry A. Hausman, Professor of Economics, 

Massachusetts Institute of Technology

Dr. Seth T. Kaplan, Principal, The Brattle Group

Alan H. Price )

 – OF COUNSEL Robert E. DeFrancesco, III )

In Opposition to the Imposition of

 Antidumping and Countervailing Duty Orders:

Winston & Strawn LLP

Washington, D.C.

on behalf of

Chinese Respondent Producers of OCTG

Mike Jordan, CEO, Mike Jordan Co.

Byron Dunn, Principal, Tubular Synergy Group LP

Professor Thomas J. Prusa, Economic Consultant,

Rutgers University

James P. Durling )

 – OF COUNSEL Daniel L. Porter )

B-6
APPENDIX C

SUMMARY DATA

C-1

Table C-1

OCTG: Summary data concerning the U.S. market, 2006-08, January-September 2008, and January-September 2009

(Quantity=short tons, value=1,000 dollars, unit values, unit labor costs, and unit expenses are per short ton; period changes=percent, except where noted)

Reported data Period changes

January-September Jan.-Sept.

Item 2006 2007 2008 2008 2009 2006-08 2006-07 2007-08 2008-09

U.S. consumption quantity:

 Amount . . . . . . . . . . . . . . . . . . . . . . . . 4,735,058 4,106,957 6,718,749 4,465,197 2,000,303 41.9 -13.3 63.6 -55.2

 Producers' share (1) . . . . . . . . . . . . . . . 59.2 58.0 44.4 49.9 33.9 -14.8 -1.3 -13.5 -16.0

 Importers' share (1):

 China . . . . . . . . . . . . . . . . . . . . . . . . . 15.3 21.0 32.7 27.6 37.0 17.4 5.6 11.8 9.4

 Other sources . . . . . . . . . . . . . . . . . . 25.4 21.1 22.8 22.5 29.2 -2.6 -4.4 1.8 6.6

 Total imports . . . . . . . . . . . . . . . . . . 40.8 42.0 55.6 50.1 66.1 14.8 1.3 13.5 16.0

U.S. consumption value:

 Amount . . . . . . . . . . . . . . . . . . . . . . . . 6,446,654 5,206,325 11,562,912 6,918,304 3,680,600 79.4 -19.2 122.1 -46.8

 Producers' share (1) . . . . . . . . . . . . . . . 64.6 63.5 53.5 59.0 37.6 -11.1 -1.2 -10.0 -21.4

 Importers' share (1):

 China . . . . . . . . . . . . . . . . . . . . . . . . . 10.6 15.6 24.3 19.9 30.0 13.7 5.0 8.7 10.1

 Other sources . . . . . . . . . . . . . . . . . . 24.8 20.9 22.3 21.1 32.4 -2.5 -3.9 1.3 11.3

 Total imports . . . . . . . . . . . . . . . . . . 35.4 36.5 46.5 41.0 62.4 11.1 1.2 10.0 21.4

U.S. imports from:

 China:

 Quantity . . . . . . . . . . . . . . . . . . . . . . . 725,027 860,711 2,197,556 1,232,826 739,659 203.1 18.7 155.3 -40.0

 Value . . . . . . . . . . . . . . . . . . . . . . . . . 681,292 811,542 2,805,206 1,377,072 1,105,138 311.7 19.1 245.7 -19.7

 Unit value . . . . . . . . . . . . . . . . . . . . . . $940 $943 $1,277 $1,117 $1,494 35.8 0.3 35.4 33.8

 Ending inventory quantity . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 All other sources:

 Quantity . . . . . . . . . . . . . . . . . . . . . . . 1,204,575 864,612 1,534,713 1,006,389 583,130 27.4 -28.2 77.5 -42.1

 Value . . . . . . . . . . . . . . . . . . . . . . . . . 1,598,489 1,089,955 2,572,888 1,461,709 1,192,040 61.0 -31.8 136.1 -18.4

 Unit value . . . . . . . . . . . . . . . . . . . . . . $1,327 $1,261 $1,676 $1,452 $2,044 26.3 -5.0 33.0 40.7

 Ending inventory quantity . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 All sources:

 Quantity . . . . . . . . . . . . . . . . . . . . . . . 1,929,601 1,725,323 3,732,269 2,239,214 1,322,789 93.4 -10.6 116.3 -40.9

 Value . . . . . . . . . . . . . . . . . . . . . . . . . 2,279,781 1,901,497 5,378,094 2,838,781 2,297,177 135.9 -16.6 182.8 -19.1

 Unit value . . . . . . . . . . . . . . . . . . . . . . $1,181 $1,102 $1,441 $1,268 $1,737 22.0 -6.7 30.7 37.0

 Ending inventory quantity . . . . . . . . . . *** *** *** *** *** *** *** *** ***

U.S. producers':

 Average capacity quantity . . . . . . . . . . 4,294,830 4,238,435 4,469,087 3,354,491 3,439,040 4.1 -1.3 5.4 2.5

 Production quantity . . . . . . . . . . . . . . . 2,943,048 2,508,029 3,081,518 2,267,478 606,651 4.7 -14.8 22.9 -73.2

 Capacity utilization (1) . . . . . . . . . . . . . 68.5 59.2 69.0 67.6 17.6 0.4 -9.4 9.8 -50.0

 U.S. shipments:

 Quantity . . . . . . . . . . . . . . . . . . . . . . . 2,805,457 2,381,634 2,986,480 2,225,983 677,514 6.5 -15.1 25.4 -69.6

 Value . . . . . . . . . . . . . . . . . . . . . . . . . 4,166,873 3,304,828 6,184,818 4,079,523 1,383,423 48.4 -20.7 87.1 -66.1

 Unit value . . . . . . . . . . . . . . . . . . . . . . $1,485 $1,388 $2,071 $1,833 $2,042 39.4 -6.6 49.2 11.4

 Export shipments:

 Quantity . . . . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Value . . . . . . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Unit value . . . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Ending inventory quantity . . . . . . . . . . . 374,234 430,873 389,263 380,471 288,337 4.0 15.1 -9.7 -24.2

 Inventories/total shipments (1) . . . . . . . *** *** *** *** *** *** *** *** ***

 Production workers . . . . . . . . . . . . . . . 5,448 5,396 5,819 5,497 3,398 6.8 -1.0 7.8 -38.2

 Hours worked (1,000) . . . . . . . . . . . . . 11,953 11,484 12,871 9,119 4,528 7.7 -3.9 12.1 -50.3

 Wages paid ($1,000) . . . . . . . . . . . . . . 297,955 279,780 339,737 254,689 146,284 14.0 -6.1 21.4 -42.6

 Hourly wages . . . . . . . . . . . . . . . . . . . . $24.93 $24.36 $26.40 $27.93 $32.31 5.9 -2.3 8.3 15.7

 Productivity (tons/1,000 hours) . . . . . . 246.2 218.4 239.4 248.7 134.0 -2.8 -11.3 9.6 -46.1

 Unit labor costs . . . . . . . . . . . . . . . . . . $101.24 $111.55 $110.25 $112.32 $241.13 8.9 10.2 -1.2 114.7

 Net sales:

 Quantity . . . . . . . . . . . . . . . . . . . . . . . 2,940,342 2,469,138 3,128,263 2,316,803 707,619 6.4 -16.0 26.7 -69.5

 Value . . . . . . . . . . . . . . . . . . . . . . . . . 4,378,324 3,444,495 6,434,811 4,223,978 1,451,262 47.0 -21.3 86.8 -65.6

 Unit value . . . . . . . . . . . . . . . . . . . . . . $1,489 $1,395 $2,057 $1,823 $2,051 38.1 -6.3 47.5 12.5

 Cost of goods sold (COGS) . . . . . . . . . 2,964,845 2,593,617 4,001,065 2,775,683 1,170,192 35.0 -12.5 54.3 -57.8

 Gross profit or (loss) . . . . . . . . . . . . . . 1,413,479 850,878 2,433,746 1,448,295 281,070 72.2 -39.8 186.0 -80.6

 SG&A expenses . . . . . . . . . . . . . . . . . . 194,752 252,459 336,428 239,019 221,128 72.7 29.6 33.3 -7.5

 Operating income or (loss) . . . . . . . . . . 1,218,727 598,419 2,097,318 1,209,276 59,942 72.1 -50.9 250.5 -95.0

 Capital expenditures . . . . . . . . . . . . . . 124,321 150,807 157,692 103,271 107,987 26.8 21.3 4.6 4.6

 Unit COGS . . . . . . . . . . . . . . . . . . . . . . $1,008 $1,050 $1,279 $1,198 $1,654 26.8 4.2 21.8 38.0

 Unit SG&A expenses . . . . . . . . . . . . . . $66 $102 $108 $103 $312 62.4 54.4 5.2 202.9

 Unit operating income or (loss) . . . . . . $414 $242 $670 $522 $85 61.8 -41.5 176.6 -83.8

 COGS/sales (1) . . . . . . . . . . . . . . . . . . 67.7 75.3 62.2 65.7 80.6 -5.5 7.6 -13.1 14.9

 Operating income or (loss)/

 sales (1) . . . . . . . . . . . . . . . . . . . . . . . 27.8 17.4 32.6 28.6 4.1 4.8 -10.5 15.2 -24.5

 (1) "Reported data" are in percent and "period changes" are in percentage points.

Note.--Financial data are reported on a fiscal year basis and may not necessarily be comparable to data reported on a calendar year basis.

Because of rounding, figures may not add to the totals shown. Unit values and shares are calculated from the unrounded figures.

Source: Compiled from data submitted in response to Commission questionnaires and from official Commerce statistics.

C-3
Table C-2

Seamless OCTG: Summary data concerning the U.S. market, 2006-08, January-September 2008, and January-September 2009

(Quantity=short tons, value=1,000 dollars, unit values, unit labor costs, and unit expenses are per short ton; period changes=percent, except where noted)

Reported data Period changes

January-September Jan.-Sept.

Item 2006 2007 2008 2008 2009 2006-08 2006-07 2007-08 2008-09

U.S. consumption quantity:

 Amount . . . . . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Producers' share (1) . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Importers' share (1):

 China . . . . . . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Other sources . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Total imports . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

U.S. consumption value:

 Amount . . . . . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Producers' share (1) . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Importers' share (1):

 China . . . . . . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Other sources . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Total imports . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

U.S. imports from:

 China:

 Quantity . . . . . . . . . . . . . . . . . . . . . . . 572,701 660,333 1,726,350 976,062 565,024 201.4 15.3 161.4 -42.1

 Value . . . . . . . . . . . . . . . . . . . . . . . . . 580,834 668,358 2,327,621 1,149,389 901,348 300.7 15.1 248.3 -21.6

 Unit value . . . . . . . . . . . . . . . . . . . . . . $1,014 $1,012 $1,348 $1,178 $1,595 32.9 -0.2 33.2 35.5

 Ending inventory quantity . . . . . . . . . . (2) (2) (2) (2) (2) (2) (2) (2) (2)

 All other sources:

 Quantity . . . . . . . . . . . . . . . . . . . . . . . 579,166 363,766 848,855 495,210 377,999 46.6 -37.2 133.4 -23.7

 Value . . . . . . . . . . . . . . . . . . . . . . . . . 1,030,267 618,138 1,664,563 855,987 917,728 61.6 -40.0 169.3 7.2

 Unit value . . . . . . . . . . . . . . . . . . . . . . $1,779 $1,699 $1,961 $1,729 $2,428 10.2 -4.5 15.4 40.5

 Ending inventory quantity . . . . . . . . . . (2) (2) (2) (2) (2) (2) (2) (2) (2)

 All sources:

 Quantity . . . . . . . . . . . . . . . . . . . . . . . 1,151,868 1,024,099 2,575,205 1,471,272 943,023 123.6 -11.1 151.5 -35.9

 Value . . . . . . . . . . . . . . . . . . . . . . . . . 1,611,102 1,286,496 3,992,184 2,005,376 1,819,076 147.8 -20.1 210.3 -9.3

 Unit value . . . . . . . . . . . . . . . . . . . . . . $1,399 $1,256 $1,550 $1,363 $1,929 10.8 -10.2 23.4 41.5

 Ending inventory quantity . . . . . . . . . . (2) (2) (2) (2) (2) (2) (2) (2) (2)

U.S. producers':

 Average capacity quantity . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Production quantity . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Capacity utilization (1) . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 U.S. shipments:

 Quantity . . . . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Value . . . . . . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Unit value . . . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Export shipments:

 Quantity . . . . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Value . . . . . . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Unit value . . . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Ending inventory quantity . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Inventories/total shipments (1) . . . . . . . *** *** *** *** *** *** *** *** ***

 Production workers . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Hours worked (1,000) . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Wages paid ($1,000) . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Hourly wages . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Productivity (tons/1,000 hours) . . . . . . *** *** *** *** *** *** *** *** ***

 Unit labor costs . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Net sales:

 Quantity . . . . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Value . . . . . . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Unit value . . . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Cost of goods sold (COGS) . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Gross profit or (loss) . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 SG&A expenses . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Operating income or (loss) . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Capital expenditures . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Unit COGS . . . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Unit SG&A expenses . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Unit operating income or (loss) . . . . . . *** *** *** *** *** *** *** *** ***

 COGS/sales (1) . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Operating income or (loss)/

 sales (1) . . . . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 (1) "Reported data" are in percent and "period changes" are in percentage points.

 (2) Not available/not applicable.

Note.--Financial data are reported on a fiscal year basis and may not necessarily be comparable to data reported on a calendar year basis.

Because of rounding, figures may not add to the totals shown. Unit values and shares are calculated from the unrounded figures.

Source: Compiled from data submitted in response to Commission questionnaires and from official Commerce statistics.

C-4
Table C-3

Welded OCTG: Summary data concerning the U.S. market, 2006-08, January-September 2008, and January-September 2009

(Quantity=short tons, value=1,000 dollars, unit values, unit labor costs, and unit expenses are per short ton; period changes=percent, except where noted)

Reported data Period changes

January-September Jan.-Sept.

Item 2006 2007 2008 2008 2009 2006-08 2006-07 2007-08 2008-09

U.S. consumption quantity:

 Amount . . . . . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Producers' share (1) . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Importers' share (1):

 China . . . . . . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Other sources . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Total imports . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

U.S. consumption value:

 Amount . . . . . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Producers' share (1) . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Importers' share (1):

 China . . . . . . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Other sources . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Total imports . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

U.S. imports from:

 China:

 Quantity . . . . . . . . . . . . . . . . . . . . . . . 152,325 200,378 471,206 256,764 174,635 209.3 31.5 135.2 -32.0

 Value . . . . . . . . . . . . . . . . . . . . . . . . . 100,458 143,184 477,585 227,684 203,789 375.4 42.5 233.5 -10.5

 Unit value . . . . . . . . . . . . . . . . . . . . . . $659 $715 $1,014 $887 $1,167 53.7 8.4 41.8 31.6

 Ending inventory quantity . . . . . . . . . . (2) (2) (2) (2) (2) (2) (2) (2) (2)

 All other sources:

 Quantity . . . . . . . . . . . . . . . . . . . . . . . 625,408 500,846 685,859 511,179 205,131 9.7 -19.9 36.9 -59.9

 Value . . . . . . . . . . . . . . . . . . . . . . . . . 568,221 471,817 908,325 605,722 274,312 59.9 -17.0 92.5 -54.7

 Unit value . . . . . . . . . . . . . . . . . . . . . . $909 $942 $1,324 $1,185 $1,337 45.8 3.7 40.6 12.9

 Ending inventory quantity . . . . . . . . . . (2) (2) (2) (2) (2) (2) (2) (2) (2)

 All sources:

 Quantity . . . . . . . . . . . . . . . . . . . . . . . 777,734 701,223 1,157,064 767,943 379,766 48.8 -9.8 65.0 -50.5

 Value . . . . . . . . . . . . . . . . . . . . . . . . . 668,679 615,001 1,385,910 833,405 478,101 107.3 -8.0 125.4 -42.6

 Unit value . . . . . . . . . . . . . . . . . . . . . . $860 $877 $1,198 $1,085 $1,259 39.3 2.0 36.6 16.0

 Ending inventory quantity . . . . . . . . . . (2) (2) (2) (2) (2) (2) (2) (2) (2)

U.S. producers':

 Average capacity quantity . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Production quantity . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Capacity utilization (1) . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 U.S. shipments:

 Quantity . . . . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Value . . . . . . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Unit value . . . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Export shipments:

 Quantity . . . . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Value . . . . . . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Unit value . . . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Ending inventory quantity . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Inventories/total shipments (1) . . . . . . . *** *** *** *** *** *** *** *** ***

 Production workers . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Hours worked (1,000) . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Wages paid ($1,000) . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Hourly wages . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Productivity (tons/1,000 hours) . . . . . . *** *** *** *** *** *** *** *** ***

 Unit labor costs . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Net sales:

 Quantity . . . . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Value . . . . . . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Unit value . . . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Cost of goods sold (COGS) . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Gross profit or (loss) . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 SG&A expenses . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Operating income or (loss) . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Capital expenditures . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Unit COGS . . . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Unit SG&A expenses . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Unit operating income or (loss) . . . . . . *** *** *** *** *** *** *** *** ***

 COGS/sales (1) . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 Operating income or (loss)/

 sales (1) . . . . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** ***

 (1) "Reported data" are in percent and "period changes" are in percentage points.

 (2) Not available/not applicable.

Note.--Financial data are reported on a fiscal year basis and may not necessarily be comparable to data reported on a calendar year basis.

Because of rounding, figures may not add to the totals shown. Unit values and shares are calculated from the unrounded figures.

Source: Compiled from data submitted in response to Commission questionnaires and from official Commerce statistics.

C-5

APPENDIX D

TARIFF TREATMENT OF OCTG IN 2009

D-1

Harmonized Tariff Schedule of the United States (2009) (Rev. 1)

Annotated for Statistical Reporting Purposes

XV

73-6

 Heading/ Stat. Unit Rates of Duty

 Subheading Suf- Article Description of 1 2

 fix Quantity General Special

7304 (con.) Tubes, pipes and hollow profiles, seamless, of iron (other 

than cast iron) or steel (con.):

Casing, tubing and drill pipe, of a kind used in drilling

for oil or gas (con.):

7304.29 Other:

Casing:

Of iron or nonalloy steel:

7304.29.10 Threaded or coupled . . . . . . . . . . . . . . . . . . . . . . . . Free 20%

Having an outside diameter less 

than 215.9 mm:

 10 Having a wall thickness less

than 12.7 mm . . . . . . . . . . . . . . . kg

 20 Having a wall thickness of

12.7 mm or more . . . . . . . . . . . . kg

Having an outside diameter of 

215.9 mm or more but not

exceeding 285.8 mm:

 30 Having a wall thickness less

than 12.7 mm . . . . . . . . . . . . . . . kg

 40 Having a wall thickness of

12.7 mm or more . . . . . . . . . . . . kg

Having an outside diameter

exceeding 285.8 mm but not

exceeding 406.4 mm:

 50 Having a wall thickness less

than 12.7 mm . . . . . . . . . . . . . . . kg

 60 Having a wall thickness of

12.7 mm or more . . . . . . . . . . . . kg

 80 Having an outside diameter

exceeding 406.4 mm . . . . . . . . . . . . kg

7304.29.20 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Free 1%

Having an outside diameter less 

than 215.9 mm:

 10 Having a wall thickness less

than 12.7 mm . . . . . . . . . . . . . . . kg

 20 Having a wall thickness of

12.7 mm or more . . . . . . . . . . . . kg

Having an outside diameter of 

215.9 mm or more but not

exceeding 285.8 mm:

 30 Having a wall thickness less

than 12.7 mm . . . . . . . . . . . . . . . kg

 40 Having a wall thickness of

12.7 mm or more . . . . . . . . . . . . kg

Having an outside diameter

exceeding 285.8 mm but not

exceeding 406.4 mm:

 50 Having a wall thickness less

than 12.7 mm . . . . . . . . . . . . . . . kg

 60 Having a wall thickness of

12.7 mm or more . . . . . . . . . . . . kg

 80 Having an outside diameter

exceeding 406.4 mm . . . . . . . . . . . . kg
Harmonized Tariff Schedule of the United States (2009) (Rev. 1)

Annotated for Statistical Reporting Purposes

 XV

73-7

 Heading/ Stat. Unit Rates of Duty

 Subheading Suf- Article Description of 1 2

 fix Quantity General Special

7304 (con.) Tubes, pipes and hollow profiles, seamless, of iron (other 

than cast iron) or steel (con.):

Casing, tubing and drill pipe, of a kind used in drilling

for oil or gas (con.):

7304.29 Other (con.):

(con.)

Casing (con.):

Of other alloy steel:

7304.29.31 Threaded or coupled . . . . . . . . . . . . . . . . . . . . . . . . Free 28%

Having an outside diameter less 

than 215.9 mm:

 10 Having a wall thickness less

than 12.7 mm . . . . . . . . . . . . . . . kg

 20 Having a wall thickness of

12.7 mm or more . . . . . . . . . . . . kg

Having an outside diameter of 

215.9 mm or more but not

exceeding 285.8 mm:

 30 Having a wall thickness less

than 12.7 mm . . . . . . . . . . . . . . . kg

 40 Having a wall thickness of

12.7 mm or more . . . . . . . . . . . . kg

Having an outside diameter

exceeding 285.8 mm but not

exceeding 406.4 mm:

 50 Having a wall thickness less

than 12.7 mm . . . . . . . . . . . . . . . kg

 60 Having a wall thickness of

12.7 mm or more . . . . . . . . . . . . kg

 80 Having an outside diameter

exceeding 406.4 mm . . . . . . . . . . . . kg

7304.29.41 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Free 8.5%

Having an outside diameter less 

than 215.9 mm:

 10 Having a wall thickness less

than 12.7 mm . . . . . . . . . . . . . . . kg

 20 Having a wall thickness of

12.7 mm or more . . . . . . . . . . . . kg

Having an outside diameter of 

215.9 mm or more but not

exceeding 285.8 mm:

 30 Having a wall thickness less

than 12.7 mm . . . . . . . . . . . . . . . kg

 40 Having a wall thickness of

12.7 mm or more . . . . . . . . . . . . kg

Having an outside diameter

exceeding 285.8 mm but not

exceeding 406.4 mm:

 50 Having a wall thickness less

than 12.7 mm . . . . . . . . . . . . . . . kg

 60 Having a wall thickness of

12.7 mm or more . . . . . . . . . . . . kg

 80 Having an outside diameter

exceeding 406.4 mm . . . . . . . . . . . . kg
Harmonized Tariff Schedule of the United States (2009) (Rev. 1)

Annotated for Statistical Reporting Purposes

XV

73-8

 Heading/ Stat. Unit Rates of Duty

 Subheading Suf- Article Description of 1 2

 fix Quantity General Special

7304 (con.) Tubes, pipes and hollow profiles, seamless, of iron (other 

than cast iron) or steel (con.):

Casing, tubing and drill pipe, of a kind used in drilling

for oil or gas (con.):

7304.29 Other (con.):

(con.)

Tubing:

7304.29.50 Of iron or nonalloy steel . . . . . . . . . . . . . . . . . . . . . . . . . Free 25%

Having an outside diameter not

exceeding 114.3 mm:

 15 Having a wall thickness not

exceeding 9.5 mm . . . . . . . . . . . . . . kg

 30 Having a wall thickness exceeding

9.5 mm . . . . . . . . . . . . . . . . . . . . . . . kg

 45 Having an outside diameter exceeding

114.3 mm but less than 215.9 mm . . . . . kg

 60 Having an outside diameter of 

215.9 mm or more but not exceeding 

406.4 mm . . . . . . . . . . . . . . . . . . . . . . . . kg

 75 Having an outside diameter exceeding 

406.4 mm . . . . . . . . . . . . . . . . . . . . . . . . kg

7304.29.61 Of other alloy steel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Free 35%

Having an outside diameter not

exceeding 114.3 mm:

 15 Having a wall thickness not

exceeding 9.5 mm . . . . . . . . . . . . . . kg

 30 Having a wall thickness exceeding

9.5 mm . . . . . . . . . . . . . . . . . . . . . . . kg

 45 Having an outside diameter exceeding 

114.3 mm but less than 215.9 mm . . . . . kg

 60 Having an outside diameter of 

215.9 mm or more but not exceeding 

406.4 mm . . . . . . . . . . . . . . . . . . . . . . . . kg

 75 Having an outside diameter exceeding 

406.4 mm . . . . . . . . . . . . . . . . . . . . . . . . kg
Harmonized Tariff Schedule of the United States (2009) (Rev. 1)

Annotated for Statistical Reporting Purposes

 XV

73-9

 Heading/ Stat. Unit Rates of Duty

 Subheading Suf- Article Description of 1 2

 fix Quantity General Special

7304 (con.) Tubes, pipes and hollow profiles, seamless, of iron (other 

than cast iron) or steel (con.):

Other, of circular cross section, of iron or nonalloy steel:

7304.31 Cold-drawn or cold-rolled (cold-reduced):

7304.31.30 00 Hollow bars . . . . . . . . . . . . . . . . . . . . . . . . . . . . . kg . . . . . . Free 22%

7304.31.60 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Free 25%

 10 Suitable for use in boilers, superheaters, 

heat exchangers, condensers, refining 

furnaces and feedwater heaters . . . . . . . . . . kg

 50 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . kg

7304.39.00 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Free 25%

Suitable for use in boilers, superheaters, heat 

exchangers, condensers, refining furnaces

and feedwater heaters:

 02 Having an outside diameter less than 

38.1 mm . . . . . . . . . . . . . . . . . . . . . . . . . . . . kg

 04 Having an outside diameter of 38.1 mm or 

more but less than 190.5 mm . . . . . . . . . . . . kg

 06 Having an outside diameter of 190.5 mm or

more but not exceeding 285.8 mm . . . . . . . . kg

 08 Having an outside diameter exceeding 

285.8 mm . . . . . . . . . . . . . . . . . . . . . . . . . . . kg

Other:

 16 Galvanized, having an outside diameter not

exceeding 114.3 mm . . . . . . . . . . . . . . . . . . kg

Other:

 20 Having an outside diameter less than 

38.1 mm . . . . . . . . . . . . . . . . . . . . . . . . . kg

Having an outside diameter of 38.1 mm 

or more but not exceeding 114.3 mm:

 24 Having a wall thickness less than

6.4 mm . . . . . . . . . . . . . . . . . . . . . . . kg

 28 Having a wall thickness of 6.4 mm 

or more but not exceeding 

12.7 mm . . . . . . . . . . . . . . . . . . . . . . kg

 32 Having a wall thickness exceeding

12.7 mm . . . . . . . . . . . . . . . . . . . . . . kg
Harmonized Tariff Schedule of the United States (2009) (Rev. 1)

Annotated for Statistical Reporting Purposes

XV

73-10

 Heading/ Stat. Unit Rates of Duty

 Subheading Suf- Article Description of 1 2

 fix Quantity General Special

7304 (con.) Tubes, pipes and hollow profiles, seamless, of iron (other 

than cast iron) or steel (con.):

Other, of circular cross section, of iron or nonalloy steel

(con.):

7304.39.00 Other (con.):

(con.)

Other (con.):

Other (con.):

Having an outside diameter exceeding 

114.3 mm but less than 190.5 mm:

 36 Having a wall thickness less than

12.7 mm . . . . . . . . . . . . . . . . . . . . . . kg

 40 Having a wall thickness of 12.7 mm

or more but less than 19 mm . . . . . . kg

 44 Having a wall thickness of 19 mm 

or more . . . . . . . . . . . . . . . . . . . . . . kg

Having an outside diameter of 

190.5 mm or more but not exceeding 

285.8 mm:

 48 Having a wall thickness less than

12.7 mm . . . . . . . . . . . . . . . . . . . . . . kg

 52 Having a wall thickness of 12.7 mm

or more but less than 19 mm . . . . . . kg

 56 Having a wall thickness of 19 mm 

or more . . . . . . . . . . . . . . . . . . . . . . kg

Having an outside diameter exceeding 

285.8 mm but not exceeding 406.4 mm:

 62 Having a wall thickness less than

12.7 mm . . . . . . . . . . . . . . . . . . . . . . kg

 68 Having a wall thickness of 12.7 mm

or more but less than 19 mm . . . . . . kg

 72 Having a wall thickness of 19 mm 

or more . . . . . . . . . . . . . . . . . . . . . . kg

Having an outside diameter exceeding 

406.4 mm:

 76 Having a wall thickness less than

19 mm . . . . . . . . . . . . . . . . . . . . . . . kg

 80 Having a wall thickness of 19 mm 

or more . . . . . . . . . . . . . . . . . . . . . . kg
Harmonized Tariff Schedule of the United States (2009) (Rev. 1)

Annotated for Statistical Reporting Purposes

 XV

73-11

 Heading/ Stat. Unit Rates of Duty

 Subheading Suf- Article Description of 1 2

 fix Quantity General Special

7304 (con.) Tubes, pipes and hollow profiles, seamless, of

iron (other than cast iron) or steel (con.):

Other, of circular cross section, of stainless steel:

7304.41 Cold-drawn or cold-rolled (cold-reduced):

7304.41.30 Of an external diameter of less than 19 mm . . . . . . . . . . . . . Free 36%

 05 Of high-nickel alloy steel . . . . . . . . . . . . . . . . kg

Other:

 15 Suitable for use in boilers, superheaters,

heat exchangers, condensers, refining 

furnaces and feedwater heaters . . . . . . . kg

 45 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . kg

7304.41.60 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Free 36%

 05 Of high-nickel alloy steel . . . . . . . . . . . . . . . . kg

Other:

 15 Suitable for use in boilers, superheaters,

heat exchangers, condensers, refining 

furnaces and feedwater heaters . . . . . . . kg

 45 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . kg

7304.49.00 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Free 36%

 05 Of high-nickel alloy steel . . . . . . . . . . . . . . . . . . . kg

Other:

 15 Hollow bars . . . . . . . . . . . . . . . . . . . . . . . . . . kg

Other:

 45 Suitable for use in boilers, superheaters,

heat exchangers, condensers, refining 

furnaces and feedwater heaters . . . . . . . kg

 60 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . kg

Other, of circular cross section, of other alloy steel:

7304.51 Cold-drawn or cold-rolled (cold-reduced):

7304.51.10 00 Suitable for use in the manufacture of ball or 

roller bearings . . . . . . . . . . . . . . . . . . . . . . . . . . . kg . . . . . . Free 34%

7304.51.50 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Free 35%

 05 Of high-nickel alloy steel . . . . . . . . . . . . . . . . kg

Other:

Suitable for use in boilers, superheaters,

heat exchangers, condensers, refining 

furnaces and feedwater heaters:

 15 Of heat-resisting steel . . . . . . . . . . . kg

 45 Other . . . . . . . . . . . . . . . . . . . . . . . . kg

 60 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . kg
Harmonized Tariff Schedule of the United States (2009) (Rev. 1)

Annotated for Statistical Reporting Purposes

XV

73-12

 Heading/ Stat. Unit Rates of Duty

 Subheading Suf- Article Description of 1 2

 fix Quantity General Special

7304 (con.) Tubes, pipes and hollow profiles, seamless, of iron (other 

than cast iron) or steel (con.):

Other, of circular cross section, of other alloy steel 

(con.):

7304.59 Other:

7304.59.10 00 Suitable for use in the manufacture of ball or 

roller bearings . . . . . . . . . . . . . . . . . . . . . . . . . . . kg . . . . . . Free 34%

Other:

7304.59.20 Suitable for use in boilers, superheaters, 

heat exchangers, condensers, refining 

furnaces and feedwater heaters . . . . . . . . . . . . . . . . . . . Free 35%

 30 Of heat-resisting steel . . . . . . . . . . . . . . . kg

Other:

 40 Having an outside diameter less 

than 38.1 mm . . . . . . . . . . . . . . . . . . kg

 45 Having an outside diameter of 

38.1 mm or more but not

exceeding 114.3 mm . . . . . . . . . . . . kg

 55 Having an outside diameter

exceeding 114.3 mm but less than 

190.5 mm . . . . . . . . . . . . . . . . . . . . . kg

 60 Having an outside diameter of 

190.5 mm or more but not

exceeding 285.8 mm . . . . . . . . . . . . kg

 70 Having an outside diameter

exceeding 285.8 mm but not

exceeding 406.4 mm . . . . . . . . . . . . kg

 80 Having an outside diameter

exceeding 406.4 mm . . . . . . . . . . . . kg

Other:

7304.59.60 00 Of heat-resisting steel . . . . . . . . . . . . . . . kg . . . . . . Free 36%

7304.59.80 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Free 35%

 10 Having an outside diameter less 

than 38.1 mm . . . . . . . . . . . . . . . . . . kg

Having an outside diameter of 

38.1 mm or more but not

exceeding 114.3 mm:

 15 Having a wall thickness less

than 6.4 mm . . . . . . . . . . . . . . . . kg

 20 Having a wall thickness of 

6.4 mm or more but not

exceeding 12.7 mm . . . . . . . . . . kg

 25 Having a wall thickness

exceeding 12.7 mm . . . . . . . . . . kg

Having an outside diameter

exceeding 114.3 mm but less than 

190.5 mm:

 30 Having a wall thickness less

than 12.7 mm . . . . . . . . . . . . . . . kg

 35 Having a wall thickness of

12.7 mm or more but less than

19 mm . . . . . . . . . . . . . . . . . . . . kg

 40 Having a wall thickness of

19 mm or more . . . . . . . . . . . . . . kg
Harmonized Tariff Schedule of the United States (2009) (Rev. 1)

Annotated for Statistical Reporting Purposes

 XV

73-13

 Heading/ Stat. Unit Rates of Duty

 Subheading Suf- Article Description of 1 2

 fix Quantity General Special

7304 (con.) Tubes, pipes and hollow profiles, seamless, of iron (other 

than cast iron) or steel (con.):

Other, of circular cross section, of other alloy steel 

(con.):

7304.59 Other (con.):

(con.)

Other (con.):

Other (con.):

7304.59.80 Other (con.):

(con.)

Having an outside diameter of 

190.5 mm or more but not

exceeding 285.8 mm:

 45 Having a wall thickness less

than 12.7 mm . . . . . . . . . . . . . . . kg

 50 Having a wall thickness of

12.7 mm or more but less than

19 mm . . . . . . . . . . . . . . . . . . . . kg

 55 Having a wall thickness of

19 mm or more . . . . . . . . . . . . . . kg

Having an outside diameter

exceeding 285.8 mm but not

exceeding 406.4 mm:

 60 Having a wall thickness less

than 12.7 mm . . . . . . . . . . . . . . . kg

 65 Having a wall thickness of

12.7 mm or more but less than

19 mm . . . . . . . . . . . . . . . . . . . . kg

 70 Having a wall thickness of

19 mm or more . . . . . . . . . . . . . . kg

 80 Having an outside diameter

exceeding 406.4 mm . . . . . . . . . . . . kg

7304.90 Other:

Having a wall thickness of 4 mm or more:

7304.90.10 00 Of iron or nonalloy steel . . . . . . . . . . . . . . . . . . . kg . . . . . . Free 1%

7304.90.30 00 Of alloy steel . . . . . . . . . . . . . . . . . . . . . . . . . . . . kg . . . . . . Free 8.5%

Having a wall thickness of less than 4 mm:

7304.90.50 00 Of iron or nonalloy steel . . . . . . . . . . . . . . . . . . . kg . . . . . . Free 25%

7304.90.70 00 Of alloy steel . . . . . . . . . . . . . . . . . . . . . . . . . . . . kg . . . . . . Free 35%
Harmonized Tariff Schedule of the United States (2009) (Rev. 1)

Annotated for Statistical Reporting Purposes

XV

73-14

 Heading/ Stat. Unit Rates of Duty

 Subheading Suf- Article Description of 1 2

 fix Quantity General Special

7305 Other tubes and pipes (for example, welded, riveted or 

similarly closed), having circular cross sections, the

external diameter of which exceeds 406.4 mm, of iron or

steel:

Line pipe of a kind used for oil or gas pipelines:

7305.11 Longitudinally submerged arc welded:

7305.11.10 Of iron or nonalloy steel . . . . . . . . . . . . . . . . . . . . . . . . . . . . Free 5.5%

 30 With an external diameter exceeding 

406.4 mm but not exceeding 609.6 mm . . . . kg

 60 With an external diameter exceeding 

609.6 mm . . . . . . . . . . . . . . . . . . . . . . . . . . . kg

7305.11.50 00 Of alloy steel . . . . . . . . . . . . . . . . . . . . . . . . . . . . kg . . . . . . Free 10%

7305.12 Other, longitudinally welded:

7305.12.10 Of iron or nonalloy steel . . . . . . . . . . . . . . . . . . . . . . . . . . . . Free 5.5%

 30 With an external diameter exceeding 

406.4 mm but not exceeding 609.6 mm . . . . kg

 60 With an external diameter exceeding 

609.6 mm . . . . . . . . . . . . . . . . . . . . . . . . . . . kg

7305.12.50 00 Of alloy steel . . . . . . . . . . . . . . . . . . . . . . . . . . . . kg . . . . . . Free 10%

7305.19 Other:

7305.19.10 Of iron or nonalloy steel . . . . . . . . . . . . . . . . . . . . . . . . . . . . Free 5.5%

 30 With an external diameter exceeding 

406.4 mm but not exceeding 609.6 mm . . . . kg

 60 With an external diameter exceeding 

609.6 mm . . . . . . . . . . . . . . . . . . . . . . . . . . . kg

7305.19.50 00 Of alloy steel . . . . . . . . . . . . . . . . . . . . . . . . . . . . kg . . . . . . Free 10%

7305.20 Casing of a kind used in drilling for oil or gas:

Of iron or nonalloy steel:

7305.20.20 00 Threaded or coupled . . . . . . . . . . . . . . . . . . . . . . kg . . . . . . Free 20%

7305.20.40 00 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . kg . . . . . . Free 1%

Of alloy steel:

7305.20.60 00 Threaded or coupled . . . . . . . . . . . . . . . . . . . . . . kg . . . . . . Free 28%

7305.20.80 00 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . kg . . . . . . Free 8.5%

Other, welded:

7305.31 Longitudinally welded:

7305.31.20 00 Tapered pipes and tubes of steel principally 

used as parts of illuminating articles . . . . . . . . . . kg . . . . . . Free 45%

Other:

7305.31.40 00 Of iron or nonalloy steel . . . . . . . . . . . . . . . . kg . . . . . . Free 5.5%

7305.31.60 00 Of alloy steel . . . . . . . . . . . . . . . . . . . . . . . . . kg . . . . . . Free 10%

7305.39 Other:

7305.39.10 00 Of iron or nonalloy steel . . . . . . . . . . . . . . . . . . . kg . . . . . . Free 5.5%

7305.39.50 00 Of alloy steel . . . . . . . . . . . . . . . . . . . . . . . . . . . . kg . . . . . . Free 10%

7305.90 Other:

7305.90.10 00 Of iron or nonalloy steel . . . . . . . . . . . . . . . . . . . . . . kg . . . . . . Free 5.5%

7305.90.50 00 Of alloy steel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . kg . . . . . . Free 10%
Harmonized Tariff Schedule of the United States (2009) (Rev. 1)

Annotated for Statistical Reporting Purposes

 XV

73-15

 Heading/ Stat. Unit Rates of Duty

 Subheading Suf- Article Description of 1 2

 fix Quantity General Special

7306 Other tubes, pipes and hollow profiles (for example, open 

seamed or welded, riveted or similarly closed), of iron or 

steel:

Line pipe of a kind used for oil or gas pipelines:

7306.11.00 Welded, of stainless steel ..................... Free 10%

 10 With an outside diameter not exceeding 

114.3 mm . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . kg

 50 With an outside diameter exceeding 

114.3 mm . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . kg

7306.19 Other:

7306.19.10 Of iron or nonalloy steel . . . . . . . . . . . . . . . . . . . . . . . . . . . . Free 5.5%

 10 With an outside diameter not exceeding 

114.3 mm . . . . . . . . . . . . . . . . . . . . . . . . . . . kg

 50 With an outside diameter exceeding 

114.3 mm . . . . . . . . . . . . . . . . . . . . . . . . . . . kg

7306.19.51 Of alloy steel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Free 10%

 10 With an outside diameter not exceeding 

114.3 mm . . . . . . . . . . . . . . . . . . . . . . . . . . . kg

 50 With an outside diameter exceeding 

114.3 mm . . . . . . . . . . . . . . . . . . . . . . . . . . . kg

Casing and tubing of a kind used in drilling for oil or

gas:

7306.21 Welded of stainless steel:

Casing:

7306.21.30 00 Threaded or coupled . . . . . . . . . . . . . . . . . . . kg . . . . . . Free 28%

7306.21.40 00 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . kg . . . . . . Free 8.5%

7306.21.80 Tubing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Free 10%

 10 Imported with coupling . . . . . . . . . . . . . . . . . kg

 50 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . kg

Other:

Casing:

Of iron or nonalloy steel:

7306.29.10 Threaded or coupled . . . . . . . . . . . . . . . . . . . . . . . . Free 20%

 30 Imported with coupling . . . . . . . . . . . kg

 90 Other . . . . . . . . . . . . . . . . . . . . . . . . kg

7306.29.20 00 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . kg . . . . . . Free 1%

Other:

7306.29.31 00 Threaded or coupled . . . . . . . . . . . . . . . kg . . . . . . Free 28%

7306.29.41 00 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . kg . . . . . . Free 8.5%

Tubing:

7306.29.60 Of iron or nonalloy steel . . . . . . . . . . . . . . . . . . . . . . . . . Free 5.5%

 10 Imported with coupling . . . . . . . . . . . . . . kg

 50 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . kg

7306.29.81 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Free 10%

 10 Imported with coupling . . . . . . . . . . . . . . kg

 50 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . kg
APPENDIX E

ADDITIONAL INFORMATION CONCERNING U.S. PRODUCERS’

OPERATIONS

E-1

U.S. producers were asked to respond to several questions with regard to their OCTG production

operations. Their responses are presented below.

1. Please request your clients expand upon their responses to question II-2, particularly with respect to

whether having multiple mills under the same corporate ownership has changed their ability to respond to

demand conditions (particularly the recent downturn in demand) and whether multiple production

facilities or new, presumably better-financed ownership have enhanced their ability control costs (again,

particularly in periods of reduced demand).

EVRAZ: 

* * * * * * *

TMK IPSCO: 

* * * * * * *

U.S. Steel: 

* * * * * * *

V&M Star TCA: 

* * * * * * *

2. Please request your clients expand upon their responses to question II-4, if they reported that they had

available capacity during the period January-September 2008. Please ask your clients to address tube

production and heat treatment separately.

EVRAZ: 

* * * * * * *

TMK IPSCO: 

* * * * * * *

U.S. Steel: 

* * * * * * *

V&M Star TCA: 

* * * * * * *

E-3
3. Please request your clients to expand upon their responses to question III-16 of the Producers’

Questionnaire, if they operate both seamless and welded OCTG facilities. Please focus especially on

performance at these different facilities, including differing levels of production and utilization of

capacity; employment; order book trends; financial performance; and broader measures such as whether

facilities producing one form of OCTG remained open while facilities producing another form were

closed.

EVRAZ: 

* * * * * * *

TMK IPSCO: 

* * * * * * *

U.S. Steel: 

* * * * * * *

V&M Star TCA: 

* * * * * * *

E-4
APPENDIX F

NONSUBJECT PRICING

F-1

Nonsubject Price Comparisons

* * * * * * *

Number of quarterly comparisons for all reported specified products1

Nonsubject

Countries

United States China

Higher Lower Higher Lower

Austria *** *** *** ***

Brazil *** *** *** ***

Canada *** *** *** ***

Germany *** *** *** ***

Korea *** *** *** ***

Russia *** *** *** ***

South Africa *** *** *** ***

Turkey *** *** *** ***

Venezuela *** *** *** ***

Total 58 44 53 29

 1 “Higher” signifies that the price of the nonsubject country’s product was higher than the U.S. or Chinese price. 

Source: Compiled fro data received in Commission questionnaires.

Figure F-1

OCTG: Weighted-average f.o.b. prices and quantities of products 1-6, by country, 

January 2006-September 2009

* * * * * * *

F-3
 
APPENDIX G

ALLEGED EFFECTS OF SUBJECT IMPORTS ON U.S. PRODUCERS’ 

EXISTING DEVELOPMENT AND PRODUCTION EFFORTS,

GROWTH, INVESTMENT, AND ABILITY TO RAISE CAPITAL 

AND

DIFFERENCES IN THE PERFORMANCE OF MULTIPLE OCTG

PRODUCTION FACILITIES

G-1

The Commission requested U.S. producers to describe any actual or potential negative effects since

January 1, 2006, on their return on investment, growth, investment, ability to raise capital, existing

development and production efforts, or the scale of capital investments as a result of imports of

OCTG from China. In addition, U.S. producers were asked to discuss any differences in the

performance of their multiple OCTG production facilities. Their responses are as follows:

Actual Negative Effects

Evraz RMS

* * * * * * *

Maverick

* * * * * * *

TMK IPSCO

* * * * * * *

U.S. Steel

* * * * * * *

V&M Star

* * * * * * *

V&M TCA

* * * * * * *

Wheatland

* * * * * * *

Anticipated Negative Effects

Evraz RMS

* * * * * * *

Maverick

* * * * * * *

TMK IPSCO

* * * * * * *

U.S. Steel

* * * * * * *

V&M Star

* * * * * * *

G-3
V&M TCA

* * * * * * *

Wheatland

* * * * * * *

Differences in performance of multiple OCTG production facilities

Maverick

* * * * * * *

TMK IPSCO

* * * * * * *

U.S. Steel

* * * * * * *

V&M Star

* * * * * * *

V&M TCA

* * * * * * *

Wheatland

* * * * * * *

G-4