Certain Activated Carbon From China

Investigation No. 731-TA-1103 (Preliminary)

Publication 3852 May 2006
U.S. International Trade Commission

Robert A. Rogowsky

Director of Operations

COMMISSIONERS

Address all communications to

Secretary to the Commission

United States International Trade Commission

Washington, DC 20436

Jennifer A. Hillman

Deanna Tanner Okun, Vice Chairman

Stephen Koplan, Chairman

Charlotte R. Lane

Daniel R. Pearson

Shara L. Aranoff

Staff assigned

Jim McClure, Investigator

Nathanael Comly, Investigator

Philip Stone, Industry Analyst

Steve Trost, Economist

Charles Yost, Auditor

David Fishberg, Attorney

Karen Driscoll, Attorney
U.S. International Trade Commission

Washington, DC 20436

May 2006

www.usitc.gov

Publication 3852

Certain Activated Carbon From China

Investigation No. 731-TA-1103 (Preliminary)

i

CONTENTS

Page

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

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

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

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

Previous investigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-2

Summary data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-3

The subject product . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-3

Physical characteristics and uses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-3

Manufacturing facilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-6

Interchangeability and customer and producer perceptions . . . . . . . . . . . . . . . . . . . . . . . . . . I-8

Channels of distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-8

Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-8

Domestic like product issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-8

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

U.S. market segments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-1

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

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

U.S. supply ............................................................... II-2

U.S. demand . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-4

Substitutability issues .......................................................... II-5

Factors affecting purchasing decisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-5

Comparisons of domestic products, subject imports, and nonsubject imports ............ II-5

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

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

U.S. producers’ capacity, production, capacity utilization, shipment, inventory, 

and employment data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . III-4

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

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

U.S. imports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-1

Negligibility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-4

Apparent U.S. consumption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-5

U.S. market shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-6

Ratio of subject imports to U.S. production . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-7

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

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

Raw materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-1

Transportation costs to the U.S. market . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-1

U.S. inland transportation costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-2

Exchange rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-2

Pricing practices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-2

Pricing methods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-2

Price data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-3

Price trends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-7

Price comparisons . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-7

Lost sales and lost revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-7
ii

CONTENTS–Continued

Page

Part VI: Financial experience of U.S. firms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-1

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

Operations on activated carbon . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-1

Capital expenditures and research and development expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-3

Assets and return on investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-3

Capital and investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-4

Actual negative effects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-4

Anticipated negative effects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-4

Part VII: Threat considerations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VII-1

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

U.S. importers’ inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VII-3

Antidumping duty orders in third-country markets ................................... VII-4

Appendixes

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

B. Conference witnesses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-1

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

D. Producer and importer comments regarding differences and similarities between

 chemically activated carbon and certain activated carbon. . . . . . . . . . . . . . . . . . . . . . . . . . . D-1

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

and therefore has been identified by the use of asterisks.
 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 For purposes of this investigation, the product covered is certain activated carbon defined as a powdered,

granular or pelletized carbon product obtained by “activating” with heat and steam various materials containing

carbon, including but not limited to coal (including bituminous, lignite and anthracite), wood, coconut shells, olive

stones, and peat. The thermal and steam treatments remove organic materials and create an internal pore structure in

the carbon material. The producer can also use carbon dioxide gas (CO2) in place of steam in this process. The vast

majority of the internal porosity developed during the high temperature steam (or CO2 gas) activation process is a

direct result of oxidation of a portion of the solid carbon atoms in the raw material, converting them into a gaseous

form of carbon. This definition covers all forms of activated carbon that are activated by steam or CO2, regardless of

raw material, grade, mixture, additives, further washing or post-activation chemical treatment (chemical or water

washing, chemical impregnation or other treatment), or product form. Unless specifically excluded, this definition

covers all physical forms of certain activated carbon, including powdered activated carbon (“PAC”), granular

activated carbon (“GAC”), and pelletized activated carbon. 

Excluded from this definition are chemically-activated carbons. The carbon-based raw material used in the

chemical activation process is treated with a strong chemical agent, including but not limited to phosphoric acid or

zinc chloride sulfuric acid, that dehydrates molecules in the raw material, and results in the formation of water that is

removed from the raw material by moderate heat treatment. The activated carbon created by chemical activation has

internal porosity developed primarily due to the action of the chemical dehydration agent. Chemically activated

carbons are typically used to activate raw materials with a lignocellulosic component such as cellulose, including

wood, sawdust, paper mill waste and peat. 

To the extent that an imported activated carbon product is a blend of steam and chemically activated

carbons, products containing 50 percent or more steam (or CO2 gas) activated carbons are within this definition, and

those containing more than 50 percent chemically activated carbons are outside this definition. 

Also excluded from this definition are reactivated carbons and activated carbon cloth. Reactivated carbons

are previously used activated carbons that have had adsorbed materials removed from their pore structure after use

through the application of heat, steam and/or chemicals. Activated carbon cloth is a woven textile fabric made of or

containing activated carbon fibers. It is used in masks and filters and clothing of various types where a woven

format is required.

Any activated carbon meeting the physical description of subject merchandise provided above that is not

expressly excluded from this definition is included within the definition.

UNITED STATES INTERNATIONAL TRADE COMMISSION

Investigation No. 731-TA-1103 (Preliminary)

CERTAIN ACTIVATED CARBON 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 733(a) of the Tariff Act of 1930 (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 activated carbon,2

 provided for in

subheading 3802.10.00 of the Harmonized Tariff Schedule of the United States, that are alleged to be sold

in the United States at less than fair value (LTFV).
COMMENCEMENT OF FINAL PHASE INVESTIGATION

Pursuant to section 207.18 of the Commission’s rules, the Commission also gives notice of the

commencement of the final phase of its investigation. 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 an affirmative

preliminary determination in the investigation under section 733(b) of the Act, or, if the preliminary

determination is negative, upon notice of an affirmative final determination in that investigation under

section 735(a) of the Act. Parties that filed entries of appearance in the preliminary phase of the

investigation need not enter a separate appearance for the final phase of the investigation. Industrial

users, and, if the merchandise under investigation is sold at the retail level, representative consumer

organizations 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 investigation.

BACKGROUND

On March 8, 2006, a petition was filed with the Commission and Commerce by Calgon Carbon

Corporation, Pittsburgh, PA, and Norit Americas, Inc., Marshall, TX, alleging that an industry in the

United States is materially injured by reason of LTFV imports of certain activated carbon from China. 

Accordingly, effective March 8, 2006, the Commission instituted antidumping duty investigation No.

731-TA-1103 (Preliminary).

Notice of the institution of the Commission’s investigation 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 March 15, 2006 (71 FR 13430). The conference was held in Washington, DC, on March 30, 2006, and

all persons who requested the opportunity were permitted to appear in person or by counsel.
 1

 19 U.S.C. § 1673b(a) (2000); see also, e.g., Co-Steel Raritan, Inc. v. United States, 357 F.3d 1294 (Fed. Cir.

2004); American Lamb Co. v. United States, 785 F.2d 994, 1001-04 (Fed. Cir. 1986); Aristech Chem. Corp. v.

United States, 20 CIT 353, 354-55 (1996). No party argued that the establishment of an industry is materially

retarded by reason of the allegedly unfairly traded imports.

 2

 American Lamb Co., 785 F.2d at 1001; see also Texas Crushed Stone Co. v. United States, 35 F.3d 1535, 1543

(Fed. Cir. 1994).

 3

 Confidential Report (“CR”) at I-4, Public Report (“PR”) at I-3. Activated carbon also may be produced via

chemical activation, which is excluded from the scope of this investigation. Chemical activation generally is used to

produce a high pore volume in cellulose-based raw material such as wood or peat. Chemically activated carbon 

primarily is used in vapor phase applications such as automobile emissions canisters, and in certain solvent recovery

applications. Transcript for Commission Conference held March 30, 2006 (“Tr.”) at 115-16 (Jordan).

 4

 CR at I-2; PR at I-2.

 5

 CR at I-6; PR at I-4.

 6

 CR at I-6, I-7; PR at I-4, I-5.

 7

 CR at I-8; PR at I-6.

3

VIEWS OF THE COMMISSION

Based on the record in the preliminary phase of this investigation, we find that there is a

reasonable indication that an industry in the United States is materially injured by reason of imports of

certain activated carbon imported from China that are allegedly sold in the United States at less than fair

value (“LTFV”).

I. THE LEGAL STANDARD FOR PRELIMINARY DETERMINATIONS

The legal standard for preliminary antidumping duty determinations requires the Commission to

determine, based upon the information available at the time of the preliminary determination, whether

there is a reasonable indication that a domestic industry is materially injured or threatened with material

injury, or that the establishment of an industry is materially retarded, by reason of the allegedly unfairly

traded imports.1

 In applying this standard, the Commission weighs the evidence before it and determines

whether “(1) the record as a whole contains clear and convincing evidence that there is no material injury

or threat of such injury; and (2) no likelihood exists that contrary evidence will arise in a final

investigation.”2

II. BACKGROUND

Certain activated carbon is black carbon material obtained by “activating” various materials

containing high levels of carbon, including coal, wood, and coconut shells by treating them with steam,

carbon dioxide, and/or heat.3

 The thermal treatments remove organic materials and create a large internal

pore structure in the carbon material. The pores adsorb (trap) contaminants in liquids or gasses. 

Adsorption of contaminants removes organic compounds from the surrounding air, gas, or liquid streams,

thus helping to purify the stream.4

 Certain activated carbon is used widely by municipal water treatment

authorities to remove undesirable tastes and odors from drinking water and to eliminate contaminants

from industrial waste water.5

 Other uses of certain activated carbon include removing color and

impurities from food and chemicals, as well as removing mercury and dioxins from flue gas emissions.6

Certain activated carbon is non-toxic and has no adverse environmental effects, although once activated

carbon has been used, it may take on the toxicity of adsorbed materials.7
 8

 CR at I-4; PR at I-3..

 9

 CR/PR at Table II-1.

 10 CR at I-8; PR at I-6.

 11 On January 26, 2006, Petitioners in the instant investigation filed a petition alleging that an industry in the

United States was materially injured and threatened with material injury by reason of LTFV imports of “activated

carbon” from China, which included both steam activated and chemically activated carbon in the proposed scope of

investigation. As a result of that filing, the Commission instituted investigation No. 731-TA-1102 (Preliminary):

Activated Carbon from China. See Notice of Initiation, Activated Carbon from China, 71 Fed. Reg. 5688 (Feb. 2,

2006). Subsequently, on February 15, 2006, Petitioners withdrew their petition at the U.S. Department of Commerce

(“Commerce”). Commerce had not initiated an investigation by that date, and the Commission discontinued its

investigation effective that date. See Notice of Withdrawal of Petition, Activated Carbon from China 71 Fed. Reg.

9155 (Feb. 22, 2006).

 12 The fourteen individual members of CIAC are: Carbon Link Corp.; PICA USA; Cherishmet, Inc.; Jacobi

Carbons, Inc.; Nichem Co., Nucon International, Inc.; Sorbent Technologies Corp.; Superior Absorbents, Inc.; Tea

Importers, Inc.; U.S. Filters/Ionpure, Inc.; Unisorb Corp.; Bestac International, Inc.; Cal Pacific Carbon; and General

Carbon Corp.

 13 The thirteen individual members of CAC Group are: Carbon Activated Corp.; Carbon Resources; Clean

Environmental Concepts; KX Industries; ML Ball Company; Solid Industrial Group, Inc.; United Manufacturing

International; Winfield Industries, Inc.; California Carbon; Global Minerals; Prominent Systems; Resin Tech; and

Timemaster Trading.

 14 The twenty-one individual members of CCPAC are: Beijing Pacific Activated Carbon Products Co., Ltd;

Daneng Zhenda Activated Carbon Co., Ltd; Datong Forward Activated Carbon Co., Ltd; Datong Huaqing Activated

Carbon Co., Ltd; Datong Hongtai Activated Carbon Co., Ltd; Datong Huibao Activated Carbon Co., Ltd; Datong

Juqiang Activated Carbon Co., Ltd; Datong Locomotive Coal & Chemicals Co., Ltd.; Datong Tri-Star & Power

Carbon Plant; Datong Weidu Activated Carbon Co., Ltd; Datong Yunguang Chemical Plant; Jilin Province Bright

Future Industry & Commerce Co., Ltd; Ningxia Guanghua-Cherishmet Activated Carbon Co., Ltd; Shanxi DMD

Corporation; Shanxi Industry Technology Trading Co., Ltd; Shanxi Sincere Industrial Co., Ltd; Shanxi Xinhua

Chemical Co., Ltd; Shanxi Xinshidai Imp & Exp Co. Ltd; Shanxi Xuanzhong Chemical Industry Co., Ltd; and

Tangshan Solid Carbon Co., Ltd.

4

Certain activated carbon is sold in three basic forms: powdered, granular, and pelletized.8 Most

U.S. producers and importers ship certain activated carbon directly to end users, while a far smaller

percentage of certain activated carbon is shipped to distributors.9

 It generally is packaged and stored in

plastic bags ranging from 25 to 2,000 pounds, and shipped either by rail or truck.10

The antidumping petition in this investigation was filed on March 8, 2006.11 Petitioners are

Calgon Carbon Corporation (“Calgon”) and Norit Americas, Inc. (“Norit”). A group of U.S. importers of

subject merchandise from China, (collectively referred to as “the Coalition of Importers of Activated

Carbon” or “CIAC,”)12 participated in the conference and filed a brief. An additional group of U.S.

importers and wholesalers/distributers of subject merchandise from China, (collectively referred to as the

“CAC Group,”)13 filed a brief but did not participate at the conference. A group of exporters and

producers of subject merchandise from China, (collectively referred to as “the Coalition of Chinese

Producers of Activated Carbon” or “CCPAC,”)14 entered a notice of appearance but did not participate at

the conference or file a brief. 
 15 19 U.S.C. § 1677(4)(A).

 16 Id.

 17 19 U.S.C. § 1677(10).

 18 See, e.g., NEC Corp. v. Dep’t 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: (1) physical characteristics and uses; (2) interchangeability; (3) channels of distribution; (4) consumer

and producer perceptions of the products; (5) common manufacturing facilities, production processes and production

employees; and where appropriate, (6) price. See Nippon Steel Corp., 19 CIT at 455 n.4; Timken Co. v. United

States, 913 F. Supp. 580, 584 (Ct. Int’l Trade 1996).

 19 See, e.g., S. Rep. No. 249, 96th Cong., 1st Sess., at 90-91 (1979).

 20 Nippon Steel Corp., 19 CIT at 455; Torrington Co., 747 F. Supp. at 748-49; see also S. Rep. No. 249 at 90-91

(Congress has indicated that the domestic 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.”)

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

domestic like product corresponding to several different classes or kinds defined by Commerce); Torrington Co.,

747 F. Supp. at 748-52 (affirming Commission’s determination of six domestic like products in investigations where

Commerce found five classes or kinds).

 22 Acciai Speciali Terni S.p.A. v. United States, 118 F. Supp. 2d 1298, 1304-05 (Ct. Int’l Trade 2000); Nippon

Steel Corp. v. United States, 19 CIT at 455; Asociacion Colombiana de Exportadores de Flores v. United States, 693

F. Supp. 1165, 1169 n.5 (Ct. Int’l Trade 1988) (particularly addressing like product determination); Citrosuco

Paulista, S.A. v. United States, 704 F. Supp. 1075, 1087-88 (Ct. Int’l Trade 1988).

5

III. DOMESTIC LIKE PRODUCT

A. In General

In determining whether there is a reasonable indication that 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.”15 Section 771(4)(A) of the

Tariff Act of 1930, as amended (“the Act”), defines the relevant domestic industry as the “producers as a

[w]hole 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.”16 In turn, the 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.”17

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.18 No single factor is dispositive, and the Commission

may consider other factors it deems relevant based on the facts of a particular investigation.19 The

Commission looks for clear dividing lines among possible like products, and disregards minor

variations.20 Although the Commission must accept the determination of the U.S. Department of

Commerce (“Commerce”) as to the scope of the imported merchandise allegedly subsidized or sold at less

than fair value, the Commission determines what domestic product is like the imported articles Commerce

has identified.21 The Commission must base its domestic like product determination on the record in this

investigation. The Commission is not bound by prior determinations, even those pertaining to the same

imported products, but may draw upon previous determinations in addressing pertinent like product

issues.22
6

B. Product Description

The Department of Commerce’s notice of initiation defines the imported merchandise within the

scope of this investigation as follows – 

The merchandise subject to this investigation is certain activated carbon. 

Certain activated carbon is a powdered, granular or pelletized carbon product

obtained by “activating” with heat and steam various materials containing

carbon, including but not limited to coal (including bituminous, lignite and

anthracite), wood, coconut shells, olive stones, and peat. The thermal and

steam treatments remove organic materials and create an internal pore structure

in the carbon material. The producer can also use carbon dioxide gas (CO2) in

place of steam in this process. The vast majority of the internal porosity

developed during the high temperature steam (or CO2 gas) activation process is

a direct result of oxidation of a portion of the solid carbon atoms in the raw

material, converting them into a gaseous form of carbon.

The scope of this investigation covers all forms of activated carbon that are

activated by steam or CO2, regardless of raw material, grade, mixture, additives,

further washing or post-activation chemical treatment (chemical or water

washing, chemical impregnation or other treatment), or product form. Unless

specifically excluded, the scope of this investigation covers all physical forms

of certain activated carbon, including powdered activated carbon (“PAC”),

granular activated carbon (“GAC”), and pelletized activated carbon.

Excluded from the scope of the investigation are chemically-activated carbons. 

The carbon based raw material used in the chemical activation process is treated

with a strong chemical agent, including but not limited to phosphoric acid, zinc

chloride sulfuric acid or potassium hydroxide, that dehydrates molecules in the

raw material by moderate heat treatment. The activated carbon created by

chemical activation has internal porosity developed primarily due to the action

of the chemical dehydration agent. Chemically activated carbons are typically

used to activate raw materials with a lignocellulosic component such as

cellulose, including wood, sawdust, paper mill waste and peat.

To the extent that an imported activated carbon product is a blend of steam and

chemically activated carbons, products containing 50 percent or more steam (or

CO2) gas activated carbons are within this scope, and those containing more

than 50 percent chemically activated carbons are outside the scope.

Also excluded from this scope are reactivated carbons. Reactivated carbons are

previously used activated carbons that have had adsorbed materials removed

from their pore structure after use through the application of heat, steam and/or

chemicals.
 23 Petitioners’ Postconference Brief at 4.

 24 Respondents are CIAC and CAC Group.

 25 CIAC’s Postconference Brief at 9.

 26 In its analysis of the traditional domestic like product factors, the Commission generally considers a number of

factors including: (1) physical characteristics and uses; (2) interchangeability; (3) channels of distribution; (4)

common manufacturing facilities, production processes and production employees; (5) customer or producer

perceptions; and, when appropriate, (6) price. See, e.g., Timken Co. v. United States, 913 F. Supp. 580, 584 (Ct.

Int’l Trade 1996). No single factor is dispositive, and the Commission may consider other factors relevant to a

particular investigation. The Commission looks for clear dividing lines among possible like products, and disregards

minor variations. See, e.g., S. Rep. No. 249, 96th Cong., 1st Sess. 90-91 (1979); Torrington Co., 747 F. Supp. at

748-49.

7

Also excluded from the scope is activated carbon cloth. Activated carbon cloth

is a woven textile fabric made of or containing activated carbon fibers. It is

used in masks and filters and clothing of various types where a woven format is

required.

Any activated carbon meeting the physical description of subject merchandise

provided above that is not expressly excluded from the scope is included within

this scope. The products under investigation are currently classifiable under

Harmonized Tariff System of the United States (“HTSUS”) subheading

3802.10.00. Although HTSUS subheadings are provided for convenience and

customs purposes, the written description of the scope of this proceeding is

dispositive.

C. Domestic Like Product

In general there are three types of activated carbon: 1) carbon that has been activated using

thermal processing (“certain activated carbon”); 2) carbon that has been activated chemically; and 3)

carbon that has been reactivated (“reactivated carbon”), typically using thermal processing. Only the first

of these, certain activated carbon, is covered by the scope of this petition.

The domestic like product issues presented in the preliminary phase of this investigation concern

the extent to which the Commission should define the domestic like product to be broader than

Commerce’s scope of investigation. Petitioners argue that the Commission should find one domestic like

product consisting of certain activated carbon, coextensive with Commerce’s scope of investigation.23 

Respondents24 argue that the Commission should define the domestic like product to include both certain

activated carbon and chemically activated carbon. Respondents assert that reactivated carbon is part of

the same like product as steam and chemically activated carbon, but do not ask the Commission to

broaden the domestic like product to include reactivated carbon for purposes of the preliminary

determination.25 For purposes of the preliminary phase of this investigation, we find a single domestic

like product defined as certain activated carbon, coextensive with Commerce’s scope of investigation.

1. Whether the Domestic Like Product Should Include Chemically Activated

Carbon 

Based on the Commission’s traditional six factor like product analysis, we define the domestic

like product to be certain activated carbon, coextensive with Commerce’s scope of investigation.26 
 27 CR at I-6; PR at I-5.

 28 CR at I-6; PR at I-4, I-5.

 29 CR at I-6, I-7; PR a I-5.

 30 CR at Appendix D, p. 4-5; PR at Appendix D, p. 3.

 31 CR at Appendix D, p. 5; PR at Appendix D, p. 3.

 32 CR at Appendix D, p. 4; PR at Appendix D, p. 3.

 33 CIAC’s Postconference Brief at 6, Petitioners’ Postconference Brief, Responses to Staff Question, at Exhibit 1

at 6.

 34 CIAC’s Postconference Brief at 6, Petitioners’ Postconference Brief, Responses to Staff Question, at Exhibit 1

at 6.

 35 Tr. at 29 (O’Brien). Petitioners state that chemically activated carbons cannot be used in aquariums and

purifying pharmaceuticals due to concerns over phosphate leaking. Tr. at 82 (Rester).

 36 CR at II-7; PR at II-3.

 37 CR at Appendix D, p. 5; PR at Appendix D, p. 3. For most applications that use chemically activated carbon,

including the automobile industry, certain activated carbon does not meet the required specifications. CR at II-7; PR

at II-4.

8

Physical Characteristics and Uses

The physical characteristics of certain activated carbon and chemically activated carbon, within

the same type or form, are similar, such that they may not be physically distinguishable from each other

to the naked eye. However, they differ due to the fundamental differences in the raw material activated. 

The vast majority of certain activated carbon is made from coal or coal-based carbons, while all

domestically produced chemically activated carbon uses wood or a wood-based product as a raw

material.27 In general, wood-based, chemically activated carbons have more large- and medium-sized

pores than do coal-based, certain activated carbons. 

Generally speaking, the end use of certain activated carbon and chemically activated carbon is the

same: to trap contaminants in liquids or gases through adsorption.28 Their larger pores make chemically

activated carbons particularly well-suited for vapor phase applications, while the smaller pores in certain

activated carbons make them more suitable for liquid phase applications.29 

Interchangeability

The record is somewhat mixed with regard to this factor.30 Six importers, all individual members

of CIAC, indicated that certain activated and chemically activated carbon are generally interchangeable,

while three importers, one of whom is a member of CAC Group, stated that there is no interchangeability

between certain activated and chemically activated carbon.31 *** which is the primary domestic use for

chemically activated carbon.32

Very small amounts of certain activated carbon and chemically activated carbon are blended into

a single commercial product.33 Even when blended, however, each component performs a unique

filtration function.34

Petitioners concede that it is “possible” for chemically activated carbons to compete with certain

activated carbons in some applications, but competition is rare because chemically activated carbons are

 more expensive to produce and are priced much higher than certain activated carbons.35 ***36

Petitioners state that there are numerous applications in which chemically activated carbons are used

exclusively, including automotive emissions canisters (the largest application for chemically activated

carbons in the U.S. market), and in the filtration of hydrolyzed vegetable protein, soda ash, fruit juice, and

wine.37 Although U.S. automakers used certain activated carbon in emissions canisters during the
 38 CR at I-7; PR at I-4.

 39 CR/PR at Table II-1.

 40 CR at Appendix D, p.8; PR at Appendix D, p. 3.

 41 CR at Appendix D, p.3; PR at Appendix D, p. 2; Tr. at 121 (Jordan) (overall municipal water purification

plants account for approximately one-fifth of the total U.S. consumption of virgin activated carbon).

 42 CR at I-14; PR at I-10.

 43 CR at Appendix D, p. 6; PR at Appendix D, p. 3.

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

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

 46 CR at Appendix D, p. 9; PR at PR at Appendix D, p. 3.

 47 CR at Appendix D, p. 9-10; PR at PR at Appendix D, p. 3

9

1980s, and Respondents allege that some Asian automakers use certain activated carbon in this

application, there is no evidence on the record that certain activated carbon has been used by automakers

in the United States during the period of investigation.38

Channels of Distribution

The vast majority of certain activated carbon sold in the United States is sold directly to endusers, while a smaller percentage is sold to distributers.39 ***40 However, a majority of the end-users that

use certain activated carbon are in different industries from those using chemically activated carbons. 

The most common application for certain activated carbon sold in the United States is in municipal water

treatment facilities, while most chemically activated carbon sold in the United States is sold to the

automotive industry for emission control.41

Common Manufacturing Facilities, Production Processes, and 

Production Employees

Currently, there are no U.S. producers that produce both certain activated carbon and chemically

activated carbon. Until 2005, Norit produced both types of activated carbon, but in separate facilities and

using different equipment.42 Accordingly, there is no overlap in the facilities, workers, or equipment used

in the production of certain activated carbon and chemically activated carbon.

The production processes for certain activated carbon and chemically activated carbon differ as

well.43 In the steam activated process, the characteristic pore structure is created when steam is applied to

charcoal at high temperatures.44 In the chemically activated process, the pore structure is created when a

chemical agent is applied to wood, extracting hydrogen and oxygen in the form of water.45

Customer and Producer Perceptions

Six importers report that customers do not perceive a significant difference between certain

activated carbon and chemically activated carbon, and that they are used by customers interchangeably.46

One importer commented that chemically activated carbon is viewed as a *** while another importer

stated that it ***.47
 48 CR at I-13; PR at I-9.

 49 Petitioners’ Postconference Brief at 15.

 50 CR at Appendix D, p. 9; PR at PR at Appendix D, p. 3.

 51 CR at Appendix D, p. 10; PR at PR at Appendix D, p. 3.

 52 CR at Appendix D, p. 10, PR at PR at Appendix D, p. 3 (responses of ***).

 53 CR at Appendix D, p. 10; PR at PR at Appendix D, p. 3.

 54 CR at Appendix D, p.10, and II-7; PR at PR at Appendix D, p. 3, and II-4.

 55 CR at I-12; PR at I-8, I-9.

10

Petitioners stated that producers perceive certain activated carbon and chemically activated

carbon as different products that serve different markets.48 The fact that ***.49 ***50

Price

Relative to certain activated carbon, chemically activated carbon sells ***51 ***.52 An importer,

***, which is a member of CIAC, stated that its own information indicated that ***.53 That same importer

stated that *** has competed for municipal water treatment contracts at *** to steam activated carbons,

although ***.54

Conclusion

Certain activated carbon and chemically activated carbon, within the same type or form, possess

similar physical characteristics and share the same basic end use: to trap contaminants in liquids or gases

through adsorption. However, differences in chemical and steam activation, and the raw material

activated, create differences in pore structure and pore size. Chemically activated carbon is more

effective in vapor phase applications in the automobile industry, its primary market. Interchangeability is

limited. Certain activated carbon does not currently compete with chemically activated carbons in the

domestic automobile market, despite the much higher prices paid for chemically activated carbon in that

market. Although chemically activated carbon is theoretically interchangeable with certain activated

carbon for certain applications, as a practical matter, the higher price of chemically activated carbon

severely limits competition. While both types of carbon are sold primarily to end users, certain activated

and chemically activated carbon cannot be said to share the same channels of distribution because the

products are generally sold to different end users in different industries. Although the record is mixed

with respect to customer and producer perceptions, this preliminary record indicates that the products do

not share the same manufacturing facilities, equipment, employees, and production processes. Prices for

certain activated carbon and chemically activated carbon differ substantially. 

On these bases, we define the domestic like product as certain activated carbon, coextensive with

the scope of the investigation. We may explore this issue further in any final phase of this investigation.

2. Whether the Domestic Like Product Should Include Reactivated Carbon 

For purposes of the preliminary determination, no party has argued that the like product should be

defined more broadly than the scope to include reactivated carbon.55 Based on the Commission’s

traditional six factor like product analysis, we find that there is a clear dividing line between certain

activated carbon and reactivated carbon in the preliminary phase of this investigation.
 56 CR at I-10; PR at I-7, I-8.

 57 CR at I-11; PR at I-8.. Tr. at 164-165 (Clark); Tr. 165-166. Third-party reactivated carbon is never used in

drinking water applications.

 58 CR at I-10; PR at I-7, I-8.

 59 CR at II-3; PR at II-2, II-3. According to one of CIAC’s witnesses, there is some overlap in the equipment that

can be used to produce activated and reactivated carbons. Specifically, the furnaces can be used to produced both

products, with some cleaning and adjustment necessary for switching between producing the two products. Tr. at

110 (Kovach). Although Petitioners acknowledge that both activation and reactivation occur in a furnace or kiln,

Petitioners have stated that activation and reactivation occur in separate facilities to avoid contamination. One

domestic producer, ***, which *** the petition, stated that it uses the same machinery and employees to produce

activated and reactivated carbon. For that producer, however, reactivated carbon accounted for *** percent of

production using the common machinery and employees. CR at II-4; PR at II-3.

 60 Petitioners state that reactivated carbon does not require the production of char from the raw materials, and that

the organic compounds removed during activation are different from the adsorbed compounds removed during

reactivation. Petitioners’ Postconference Brief at 23-24. Respondents argue that the processes are almost identical,

although they acknowledge minor differences between the two processes regarding what is being carbonized, and

that reactivated carbon needs to be blended with virgin activated carbon to make up for carbon lost in the reactivated

carbon production process. CIAC’s Postconference Brief at 12-14.

 61 CR II-7; PR at II-4.

11

Reactivated carbon is made by thermally or chemically removing chemical species adsorbed onto

used activated carbon.56 It appears that reactivated carbon and activated carbon cannot be physically

distinguished within the same type or form of carbon (i.e., pelletized, powdered, granulated, etc.), and that

both have the same use: to trap contaminants in liquids or gases through adsorption. Nonetheless,

interchangeability between certain activated carbon and reactivated carbon is limited. Due to

contamination and liability concerns, most reactivated carbon can be used only in its original application.

Moreover, while some reactivated carbon is pooled for use in the same application for which the virgin

product was directed, many purchasers are unwilling to buy reactivated carbon previously used by any

other end-user. Additionally, reactivated carbons can never be used in certain beverage applications and

food grade applications.57 Although activated carbons can be used in any applications that use reactivated

carbons, reactivated carbons are frequently limited to their original application, and are used only as a

cost-saving measure. Even though almost all domestic producers of certain activated carbon market and

sell reactivated carbon, the channels of distribution for the two products differ. Certain activated carbon

is sold on the commercial market to a variety of end-users, much reactivated carbon is produced

(reactivated) and consumed internally by end-users.58 Moreover, because of contamination concerns,

activation and reactivation are performed in different facilities using different equipment.59 

Although the parties acknowledge differences in the production processes, the parties disagree as

to the importance of these differences.60 While some customers perceive reactivated carbon to be

identical to low-grade virgin carbons, as previously discussed, some end-users accept only virgin

activated carbon, and numerous other end-users use only their own reactivated carbons due to

contamination concerns. There are also significant differences in price between the two products.61

Reactivated carbon sells at much lower prices than does certain activated carbon. For the reasons

discussed above, we find a clear dividing line between certain activated carbon and reactivated carbon for

purposes of the preliminary phase of this investigation.

Accordingly, for purposes of this preliminary determination, we determine that the domestic like

product does not include reactivated carbon. We may explore this issue further in any final phase of this

investigation.
 62 19 U.S.C. § 1677(4)(A).

 63 United States Steel Group v. United States, 873 F. Supp. 673, 681-84 (Ct. Int’l Trade 1994), aff’d, 96 F.3d

1352 (Fed. Cir. 1996).

 64 The five firms that comprise the domestic industry are Calgon, Norit, California Carbon, Acticarb Tailored

Products, LLC, and Cal Pacific Carbon.

 65 19 U.S.C. § 1677(4)(B). 

 66 Tr. at 174 (Vander Schaaf).

 67 Petitioners’ Post Conference Brief at 27-29. 

 68 CR at III-I; PR at III-1; CR/PR at Table IV-1.

 69 CR/PR at Table IV-I.

 70 Tr. at 28-29 (O’Brien).

12

IV. DOMESTIC INDUSTRY

A. In General

The domestic industry is defined as the “producers as a [w]hole 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.”62 In defining the domestic industry, the Commission’s general

practice has been to include in the industry all domestic production of the domestic like product, whether

toll-produced, captively consumed, or sold in the domestic merchant market.63 Based on our finding that

the domestic like product is certain activated carbon, for purposes of this preliminary determination, we

find that the domestic industry consists of all known domestic producers of certain activated carbon.64

We now turn our discussion to the issues presented under the statutory related parties provision.

B. Related Parties

We must determine whether any producer of the domestic like product should be excluded from

the domestic industry pursuant to 19 U.S.C. § 1677(4)(B). Subsection 1677(4)(B) allows the

Commission, if appropriate circumstances exist, to exclude from the domestic industry producers that are

related to an exporter or importer of subject merchandise or which are themselves importers.65 Exclusion

of such a producer is within the Commission’s discretion based upon the facts presented in each

investigation. 

During the staff conference in this investigation, CIAC stated that it was “appropriate to at least

probe the issue of exclusion of Calgon as a related party” in view of its imports from and operations in

China. However, it provided no further discussion of this issue in its postconference submission.66

Petitioners argue that there are no related party issues in the preliminary phase of this investigation with

respect to Calgon because its interests clearly lie in domestic production rather than in importation of

subject merchandise.67 

We considered three related party issues in this investigation, relating to domestic producers

Calgon, Norit, and California Carbon. These three domestic producers accounted for 100 percent of

reported domestic production of certain activated carbon in 2005.68

Calgon is a related party due to its imports of subject merchandise. Calgon is also affiliated with

***.69 It is a Petitioner and the *** producer of certain activated carbon, accounting for *** percent of 

domestic production of certain activated carbon in 2005. Calgon stated that it began importing subject

merchandise from China after customers urged it to do so in the face of low prices from China.70 Its ratio
 71 CR at III-4; PR at III-3.

 72 CR/PR at Table VI-4.

 73 CR at III-4; PR at III-3.

 74 CR/PR at Table VI-4.

 75 CR at I-3, n. 8; PR at I-3, n. 8

 76 CR at III-4; PR at III-3.

 77 *** percent of California Carbon’s operations were used for ***. CR at III-4; PR at III-3.

 78 CR at III-4; PR at III-3.

 79 Negligibility is not an issue in this investigation. The petition was filed on March 8, 2006. Based on official

Commerce statistics, subject imports from China accounted for approximately 56.1 percent of total imports of certain

activated carbon between March 2005 and February 2006, the most recent 12-month period for which data were

available that preceded the filing of the petition. CR/PR at Table IV-6.

 80 19 U.S.C. §§ 1671b(a) and 1673b(a).

13

of subject imports from China to domestic production was *** percent in 2005.71 Calgon’s operating

income as a ratio of net sales ***72 

Based on these data, Calgon’s interests appear to lie more in domestic production than in

importation. Additionally, it is a Petitioner; it accounts for the *** of domestic production of certain

activated carbon; and it does not appear to derive a significant financial benefit from the subject imports

in light of ***. On these grounds, we do not find that appropriate circumstances exist to exclude Calgon

from the domestic industry.

Norit is a related party due to its imports of subject merchandise. It is a Petitioner and the ***

domestic producer of certain activated carbon, accounting for *** percent of reported domestic

production of certain activated carbon in 2005. The ratio of its subject imports to its production was ***

percent in 2005.73 Norit’s operating income as a ratio to net sales ***.74 

Based on these data, Norit’s interests appear to lie in domestic production. It is a Petitioner; it

accounts for a *** share of domestic production; and it does not appear to have benefitted financially

from the subject imports, as it imported *** while experiencing ***. We do not find that appropriate

circumstances exist to exclude Norit from the domestic industry.

California Carbon accounted for only *** percent of domestic production of certain activated

carbon in 2005.75 California Carbon reported that it ***. ***.76 Although California Carbon ***,

whether California Carbon should be excluded from the domestic industry under the related party

provision is essentially moot at this time. Given that California Carbon *** for the domestic industry

even if the Commission found exclusion to be appropriate.77 Moreover, California Carbon accounted for 

*** percentage of domestic production that *** the aggregate domestic industry data.78 Accordingly, we

do not find that appropriate circumstances exist to exclude California Carbon from the domestic industry

for purposes of this preliminary determination.

In sum, we do not find that appropriate circumstances exist to exclude Calgon, Norit, or

California Carbon, from the domestic industry. Accordingly, we conclude that the domestic industry

consists of all known domestic producers of certain activated carbon.

V. REASONABLE INDICATION OF MATERIAL INJURY BY REASON OF LESS THAN

FAIR VALUE IMPORTS FROM CHINA79

In the preliminary phase of antidumping or countervailing duty investigations, the Commission

determines whether there is a reasonable indication that an industry in the United States is materially

injured by reason of the imports under investigation.80 In making this determination, the Commission

must consider the volume of subject imports, their effect on prices for the domestic like product, and
 81 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 . . . [a]nd explain in full its relevance to the determination.” 

19 U.S.C. § 1677(7)(B); see also, e.g., Angus Chem. Co. v. United States, 140 F.3d 1478 (Fed. Cir. 1998).

 82 19 U.S.C. § 1677(7)(A).

 83 19 U.S.C. § 1677(7)(C)(iii).

 84 19 U.S.C. § 1677(7)(C)(iii).

 85 CR/PR at Table C-1. Because official Commerce import statistics include chemically activated carbon, which is

outside the scope of this investigation, we netted out the chemically activated carbon, using proportions gathered

from questionnaire data, to derive total apparent consumption of certain activated carbon. Id.

 86 CR at II-6; PR at II-4.

 87 CR at II-6; PR at II-4.

 88 CIAC Postconference Brief at 21-22; Petitioners Postconference Brief at 30 n. 14.

14

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

production operations.81 The statute defines “material injury” as “harm which is not inconsequential,

immaterial, or unimportant.”82 In assessing whether there is a reasonable indication that 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.83 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.”84

For the reasons stated below, we determine that there is a reasonable indication that the domestic

industry producing certain activated carbon is materially injured by reason of subject imports from China.

A. Conditions of Competition and the Relevant Business Cycle

The following conditions of competition inform our analysis of whether there is a reasonable

indication of material injury by reason of subject imports.

1. Demand Conditions

Total apparent consumption of certain activated carbon increased by 12.8 percent over the period

of investigation from *** in 2003 to *** in 2004, and to *** in 2005.85 Consistent with the trend in

consumption, market participants that responded to Commission questionnaires generally agreed that

demand for certain activated carbon rose over the period of investigation.86 They generally attributed

higher demand to stricter U.S. Environmental Protection Agency (“EPA”) regulations regarding the

treatment of water, and the emission of pollutants.87 Respondents state that new legislation regarding

mercury emissions by power plants may result in a substantial increase in demand for certain activated

carbon, while Petitioners characterize growth due to this demand as speculative and not imminent.88 We

intend to examine the issue of increased demand for certain activated carbon due to legislation concerning

mercury emissions by power plants in any final phase of this investigation.
 89 CR at III-1; PR at III-1. The petition identified five firms that produced activated carbon during 2003-2005. 

In addition to Petitioners, California Carbon, ***, produced *** pounds of certain activated carbon in 2005,

accounting for *** percent of domestic production. CR at III-4; PR at III-1. The petition also lists as domestic

producers, Acticarb Tailored Products, LLC, which stopped producing certain activated carbon in October 2005 and

is not currently in operation, as well as Cal Pacific Carbon, ***. CR at III-1; PR at III-1. On March 15, 2006, CIAC

filed an industry support challenge stating that numerous companies were not only importers of activated carbon, but

also U.S. producers. See CR at III-2, n. 6; PR at III-1, n. 6. However, in response to a question posed by

Commission staff as to whether the five firms identified in the petition are the only domestic “activators” of certain

activated carbon, counsel for CIAC stated, “[t]o our knowledge, that’s correct.” Id. quoting Tr. at 158

(Heckendorn).

 90 CR at III-3, III-4; PR at III-1.

 91 CR/PR at Table II-1.

 92 CR/PR at Table II-1.

 93 CR/PR at Table IV-7.

 94 CR/PR at Table IV-7. 

 95 CR/PR at Table IV-7.

 96 CR at VI-7; PR at VI-1. Calgon’s U.S. shipments of certain activated carbon in 2005 were allocated as

follows: ***. Calgon’s U.S. Producer Questionnaire at Section II-11. Norit’s U.S. shipments of certain activated

carbon in 2005 were allocated as follows: ***. Norit’s U.S. Producer Questionnaire at II-11.

 97 CR/PR at Table IV-10.

 98 Capacity utilization by domestic producers ***. CR/PR at Table C-1. Given the high capital intensive nature of

certain activated carbon production, Petitioners assert that high capacity utilization rates are necessary to spread the

high fixed costs over as much production volume as possible. Tr. at 38-39 (Hudgens). Calgon states that a

production line closed in 2003 could be restarted if there were shortages and if prices justified it. Petitioners’

15

2. Supply Conditions

U.S. Producer Supply 

The Commission received questionnaire responses from three domestic producers of certain

activated carbon, two of which are Petitioners, Calgon and Norit.89 Petitioners accounted for

approximately *** percent of reported U.S. production of certain activated carbon in 2005. Calgon is the

*** producer of certain activated carbon, and Norit is the ***, accounting for *** percent and ***

percent of reported domestic production in 2005, respectively.90

Approximately *** percent of U.S. producers’ U.S. shipments of certain activated carbon went to

end users in each year of the period of investigation.91 A *** share of importers’ U.S. shipments went to

distributors, with shipments to end users accounting for between 64 and 74 percent of U.S. imports from

China during the period of investigation.92

Throughout the period of investigation, the principal suppliers of certain activated carbon to the

U.S. market were the domestic producers.93 The next largest suppliers were importers of subject

merchandise.94 The remaining portion of the market was supplied by imports of certain activated carbon

from nonsubject countries.95 

Almost all of the certain activated carbon produced domestically is coal-based. Domestic

producer *** produces mainly *** certain activated carbon, while domestic producer *** produces

mainly *** certain activated carbon.96 

As a share of total U.S. consumption, domestically produced certain activated carbon fell from

58.6 percent in 2003 to 53.1 percent in 2004, and to 51.7 percent in 2005.97 Total U.S. consumption of

certain activated carbon increased from *** in 2003 to *** in 2005, while total U.S. 

production ***.98 Approximately *** percent of domestic producers’ production capacity was ***.99
Postconference Brief at 47.

 99 CIAC’s Postconference Brief at 23. 

 100 Tr. at 169 (Skeini).

 101 Pelletized activated carbon is not currently produced in meaningful quantities in the United States. CR at II-9;

PR at II-6.

 102 CR at II-4; PR at II-3. From 2003-2005, reported Chinese production capacity increased from 197.5 million

pounds to 274.1 million pounds, as capacity utilization rose from 90.8 percent in 2003 to 92.0 percent in 2005. CR

at II-4, II-5; PR at II-3. 

 103 Tr. at 168-169 (Kovach and Skeini). Based on official Commerce data, the Philippines and Sri Lanka were the

two largest sources for nonsubject imports of activated carbon over the period examined, accounting for 14.3 and

11.9 percent of imports in 2005, respectively. CR at IV-7, n. 4; PR at IV-I, n. 4. 

 104 CR at II-11; PR at II-7.

 105 CR/PR at Table IV-7.

 106 CR/PR at Table III-10.

 107 See Petitioners’ Postconference Brief at 31. 

 108 CIAC’s Postconference Brief at 16. CIAC notes that Calgon claims to sell at least 54 different activated

carbon products, while Norit claims to sell 150 varieties of activated carbon products. Tr. 117-118 (Jordan). 

16

Subject import supply

Almost all of the certain activated carbon produced in China is coal-based, although

according to conference testimony, China has also recently started producing small amounts of coconutshell based certain activated carbon.100 Chinese producers produce mainly granular certain activated

carbon, but also some powdered and pelletized certain activated carbon.101 As a share of total U.S.

consumption, subject imports from China rose from 26.8 percent in 2003 to 30.2 percent in 2004 before

falling slightly to 29.1 percent in 2005.102

Nonsubject import supply

There is limited record evidence on nonsubject imports. According to conference testimony and

importer questionnaire responses, the increasing volume of nonsubject imports coming into the United

States are primarily high performance, coconut shell activated carbon from Southeast Asia, particularly

the Philippines, Sri Lanka, and India.103 The importers noted that very little, if any, domestically

produced activated carbon uses coconut shells as a raw material.104 Two producers and four importers

reported that non-price differences were never a factor when comparing U.S. product to certain activated

carbon from nonsubject countries.

The volume of nonsubject imports has increased over the period examined.105 As a share of total

U.S. consumption by quantity, nonsubject imports increased from 14.6 percent in 2003 to 19.3 percent in

2005.106

3. Interchangeability

Petitioners argue that certain activated carbon is a commodity product and that price is the driving

factor in purchasing decisions.107 Respondents argue that activated carbon is not a commodity product. 

Rather, Respondents state that purchasers differentiate among activated carbons based on the carbons’

source material, production methods, product structures, and other characteristics.108 Respondents state

that there are several applications in the food and chemical industries for which
 109 CIAC asserts that there are several industries within the United States, including gold mines, respirators, and

cigarette filters, that require a variety of activated carbon that is not produced by the domestic industry. Tr. at 122-

123 (Jordan). Several importers noted that pelletized certain activated carbon is no longer produced in the United

States, whereas it is produced in China. CR at II-9; PR at II-5, II-6. According to questionnaire data, imports of

coal-based pelletized activated carbon from China was *** million pounds in 2005, as compared to total subject

imports of *** million pounds in that year. CIAC’s Postconference Brief at 20.

 110 CIAC’s Postconference Brief at 20; Tr. at 119-121 (Jordan).

 111 CR at II-9; PR at II-5, II-6.

 112 CR at II-9; PR at II-5, II-6. *** during the period on investigation, indicated that certain activated carbon

produced in the United States and China are frequently interchangeable. *** U.S. Importers’ Questionnaire

Response at 14.

 113 CR/PR at Table V-5.

 114 CR at II-10; PR at II-6.

 115 CR at II-10; PR at II-7.

 116 CIAC’s Postconference Brief at 25.

 117 CIAC’s Postconference Brief at 25-26. Moreover, CIAC argues that there are numerous privatized municipal

purification facilities that de facto will use only domestically produced certain activated carbon. Tr. at 122 (Jordan).

 118 Petitioners’ Postconference Brief at 34.

17

subject imports cannot satisfy performance requirements.109 Moreover, Respondents assert also that many

end-users regard subject imports as poor in quality and inferior to domestically produced carbons.110

Reports were mixed as to the extent to which domestically produced certain activated carbon and

subject imports are interchangeable. *** responding producers and 3 of 28 importers who reported

having knowledge of both U.S. produced certain activated carbon and subject merchandise reported that

Chinese and U.S. certain activated carbon are always interchangeable.111 Five importers reported that

product from the countries are frequently interchangeable, 19 importers reported the products are

sometimes interchangeable, and one reported they are never interchangeable.112 Numerous purchasers

have confirmed lost sales, an indication of direct competition between domestic producers and Chinese

producers of certain activated carbon.113 

 *** responding producers as well as four importers reported that non-price differences are never a

factor in deciding whether to purchase certain activated carbon from China or domestically produced

certain activated carbon. Seven importers reported that non-price differences are always a factor, eleven

reported that non-price differences are frequently a factor, and six importers reported that non-price

differences were sometimes a factor.114 Importers listed quality, availability, particular product

characteristics, and technical support as factors other than price that may influence their purchasing

decisions.115

 4. “Buy American” Contract Provisions

Respondents state that subject imports have not been able to penetrate several domestic markets

for certain activated carbon due to requirements of municipalities to purchase domestically produced

certain activated carbon to comply with “Buy American” provisions.116 CIAC estimates that “Buy

American” provisions protect between 26 million and 39 million pounds of certain activated carbon from

import competition.117 Petitioners state that Respondents greatly exaggerate the number of municipalities

that have formal “Buy American” provisions in their contracts, and that these provisions actually apply to

only a small minority of contracts.118 Petitioners note that municipalities are often required by law to
 119 Petitioners’ Postconference Brief at 34. 

 120 19 U.S.C. § 1677(7)(C)(i).

 121 In addition to finding that subject import volume was significant during the period examined, Commissioner

Hillman also finds the increase in volume to be significant.

 122 Official Commerce import statistics include chemically activated carbon, which is outside the scope of this

investigation. In order to derive imports of certain activated carbon, we revised these figures downward using as a

guide the proportions of certain activated carbon and chemically activated carbon reported in importer

questionnaires. See, e.g., CR/PR at Table C-1.

 123 CR/PR at Table C-1.

 124 CR/PR at Table IV-10.

 125 CR/PR at Table IV-10.

 126 CR/PR at Table IV-10.

 127 CIAC’s Postconference Brief at 24.

 128 CR/PR at Table C-1.

 129 In any final phase investigation, the Commission invites parties to comment on the applicability of the recent

decision by the U.S. Court of Appeals for the Federal Circuit, Bratsk Aluminum Smelter v. United States, No. 05-

1213 ( Fed. Cir. Apr. 10, 2006) (under Fed. R. App. P. 41(b), the mandate has not yet issued), to the facts of this

investigation. The Commission also invites parties to comment on whether the Commission should collect any

additional information to address the issues raised by the Court, and if so, what, and how, that information should be

18

accept the lowest bid regardless of source.119 We intend to examine the extent and effect of “Buy

American” provisions in any final phase of this investigation.

B. Volume of Subject Imports

Section 771(7)(C)(i) of the 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.”120

We find that subject import volume was significant during the period examined both in absolute

terms and relative to consumption and production in the United States.121122

In absolute terms, the volume of subject imports increased by *** percent from 2003 to 2005,

from *** million pounds in 2003 to *** million pounds in both 2004 and 2005.123

The share of the quantity of U.S. apparent consumption held by subject imports increased by 2.3

percentage points from 2003 to 2005, rising from 26.8 percent in 2003 to 30.2 percent in 2004, before

deceasing slightly to 29.1 percent in 2005.124 As the market share held by subject imports rose

throughout most of the period of investigation, the share held by the domestic industry fell. As total

apparent U.S. consumption increased by 12.8 percent from 2003 to 2005, the share of the quantity of

apparent U.S. consumption represented by U.S. producers’ U.S. shipments declined from 58.6 percent in

2003 to 53.1 percent in 2004 and then to 51.7 percent in 2005, an overall decrease of 6.9 percentage

points from 2003 to 2005.125

The volume of nonsubject imports and their market penetration also increased over the period

examined.126 The volume of nonsubject imports of certain activated carbon measured by quantity

increased from *** million pounds in 2003 to *** million in 2004 and further to *** million in 2005. 

Nonsubject imports’ share of total apparent consumption increased from 14.6 percent in 2003, to 16.7

percent in 2004, and rose to 19.3 percent in 2005, an overall increase of 4.7 percentage points from 2003

to 2005. CIAC argues that any displacement of market share experienced by the domestic industry has

been due to increasing imports of nonsubject imports.127 The record, however, indicates that the domestic

industry has lost market share to both subject and nonsubject imports.128 We intend to further explore the

role of nonsubject imports in the U.S. market in any final phase of this investigation.129
collected.

 130 CR/PR at Table IV-13.

 131 See product offerings by domestic and Chinese producers found at "Handout 2" distributed by counsel for

Respondents at the March 30, 2006 conference and at Exhibit 13 to Petitioners' Postconference Brief.

 132 CR at V-4, PR at V-3.

 133 CR at II-9, II-10, PR at II-7.

 134 CIAC asserts that the domestic industry does not have the capacity to supply the U.S. market, and therefore

subject imports are necessary to meet this demand. While we intend to examine this contention in any final phase of

this investigation, the Commission has noted in prior determinations that “there is no short supply provision in the

statute” and “the fact that the domestic industry may not be able to supply all of demand does not mean the industry

may not be materially injured or threatened with material injury by reason of subject imports.” Softwood Lumber

from Canada, Inv. Nos. 701-TA-414 and 731-TA-928 (Article 1904 NAFTA Remand) at 108, n. 310 (December

2003). See also Metal Calendar Slides from Japan, Inv. No. 731-TA-1094 (Preliminary), USITC Pub. 3792 (August

2005) at 9, n. 45 (“[t]o the extent that Respondents claim that the Commission is legally unable to make an

affirmative finding of material injury by reason of subject imports because the domestic industry is incapable of

supplying domestic demand, they are incorrect.”)

 135 CIAC argues that any displacement of market share experienced by the domestic industry has been due to

increasing imports of nonsubject imports. The record, however, indicates that the domestic industry has lost market

share to both subject and nonsubject imports. CR at V-5, PR at V-3. We intend to explore the role of nonsubject

imports in the U.S. market in any final phase of this investigation.

19

As a ratio to U.S. production, subject imports increased from *** percent in 2003 to *** percent

in 2004, and then increased slightly to *** percent of U.S. production in 2005.130

We have considered the arguments advanced by Respondents with respect to subject imports. 

Respondents argue that subject import volumes are not significant because competition between

domestically produced certain activated carbon and subject imports is limited by differences in product

characteristics, with particular forms of certain activated carbon available from only domestic producers

or subject imports. Both domestic producers and producers in China, however, offer a wide range of

activated carbon products.131 Moreover, while there are many product offerings, just a few products

account for a substantial portion of sales in the U.S. market. Three products alone account for almost ***

of U.S. commercial shipments and slightly more than *** of U.S. commercial shipments of Chineseproduced certain activated carbon.132 While Respondents contend that subject imports have not been able

to penetrate several domestic markets for certain activated carbon due to “Buy American” requirements,

the record does not reflect that such requirements affect a substantial share of sales. With respect to

Respondents’ argument that actual or perceived quality differences limit competition between the two

products, responses from producers and importers were mixed as to the degree of interchangeability and

the importance of non-price factors in purchasing decisions.133

We find for purposes of the preliminary phase of this investigation that subject import volume

was significant during the period examined, both in absolute terms and relative to consumption and

production in the United States.134 In any final phase of this investigation, we intend to explore whether

and to what extent there may be limits to competition between domestically produced certain activated

carbon and subject imports.135
 136 19 U.S.C. § 1677(7)(C)(ii).

 137 CR/PR at Table II-2. 

 138 CR/PR at Table II-3. 

 139 The Commission collected data on the following types of certain activated carbon: (1) Granular activated

carbon that is steam activated from coal (bituminous or lignite), unwashed, no more than 15 percent greater than 12

mesh and no more than 4 percent under 30 mesh, iodine no. 900 mg/g min, moisture 2% max; (2) Granular activated

carbon that is steam activated from coal (bituminous or lignite), unwashed, no more than 5 percent greater than 12

mesh and no more than 4 percent under 40 mesh, iodine no. 1000 mg/g min, moisture 2% max; and (3) Powder

activated carbon that is steam activated from coal (bituminous or lignite), unwashed, particle size 90% min, 325

mesh, iodine no. 700 mg/g min, moisture 5% max. CR at V-4; PR at V-3.

 140 CR at V-4; PR at V-3. Certain activated carbon is sold on both a spot and a contract basis. CR at V-3; PR at

V-2.

 141 CR at V-4; PR at V-3.

 142 CR/PR at Tables V-1, V-2, V-3. For Product 3, the domestic product oversold the subject imports by ***.

 143 CR/PR at Tables V-1, V-2, V-3.

 144 *** suggested that sales to distributors are often made at a discount due to lower costs of sale involved in such

transactions. CR at II-1; PR at II-1. The higher percentage of shipments of subject imports sold to distributers may

place a downward bias on prices of imported certain activated carbon. We intend to examine this issue more closely

in any final phase of this investigation. 

20

C. Price Effects of the Subject Imports

Section 771(C)(ii) of the Act provides that, in evaluating the price effects of subject imports, 

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.136

The record reflects divergent views by market participants on the importance of price in

purchasing decisions and interchangeability. All responding domestic producers found that subject

imports were “always” interchangeable with subject imports, but only a few importers agreed.137

Consistent with these mixed reports, the two *** domestic producers reported that non-price

 differences between subject imports and the domestic like product were never a factor in purchasing

decisions, whereas 18 importers reported that non-price differences were always or frequently a factor,

and ten importers reported that they were sometimes or never a factor.138 We intend to explore issues

regarding interchangeabilty and the importance of non-price factors in any final phase of this

investigation. 

In this investigation, U.S. producers and importers provided quarterly pricing data for three types

of certain activated carbon.139 Three U.S. producers and 21 importers provided usable pricing data.140 By

quantity, pricing data reported by responding firms accounted for approximately 49.8 percent of U.S.

commercial shipments of U.S.-produced certain activated carbon and approximately 35.7 percent of U.S.

commercial shipments of certain activated carbon produced in China.141

The pricing data collected in the preliminary phase of this investigation showed a consistent

pattern of underselling. Subject imports undersold the domestic like product in 35 of the 36 quarters.142

For all three products, the margins of underselling were almost all in double digits, and ranged as high as

44.6 percent.143 For purposes of this preliminary investigation, we find that there has been significant

price underselling of the domestic like product by subject imports.144
 145 CR/PR at Tables V-1, V-2, V-3.

 146 CR/PR at Table C-1.

 147 CR/PR at Table C-1.

 148 Tr. at 199 (Hartquist).

 149 CR at V-10, V-11; PR at V-8.

 150 We note that many of the lost sales were to municipal water treatment facilities which, in many cases, are

required to accept the lowest-priced-product that meets its required standards. CR at V-11; PR at V-8. A small

number of the purchasers questioned with respect to the lost sales allegations indicated that while the Chinese

product was the lowest priced product, it did not pass initial quality tests or performed poorly upon use. As a result,

these purchasers plan to switch back to domestically produced certain activated carbon to meet their future

requirements. CR at V-11; PR at V-8. We intend to explore this issue further in any final phase of this investigation. 

We also plan to explore Respondents’ argument that purchasing higher priced domestically produced certain

activated carbon is more “cost effective” than purchasing subject imports. In other words, we will explore whether it

is actually less expensive for a customer to purchase domestically produced certain activated carbon for a higher

price because it performs better and lasts longer than similar quantities of subject merchandise. 

21

We have also considered movements in certain activated carbon prices over the period of

investigation. The Commission’s pricing data for Product 1 show a *** in domestic prices for the period

of investigation, while pricing data for Product 2 and Product 3 show a *** in domestic prices.145 We

find pricing movements have varied with no clear trend. Therefore, we do not find evidence that subject

imports are depressing domestic prices to a significant degree.

We do find, however, that subject imports have prevented domestic price increases that otherwise

would have occurred to a significant degree. The domestic industry’s cost of goods sold (“COGS”) as a

share of net sales increased steadily throughout the period of investigation from *** percent in 2003 to

*** percent in 2004, and to *** percent in 2005.146 Unit COGS also increased from $*** in 2003 to $***

in 2004, and jumped to $*** in 2005.147 We would expect domestic producers to raise prices in a

growing market over the period of investigation as costs increased. However, these data indicate that as

the domestic industry’s costs increased, and significant volumes of lower priced subject imports entered

the U.S. market, the domestic producers were unable to raise their prices to cover increasing costs.

Petitioners have acknowledged that they attempted to raise prices. Specifically, the record

reflects that Calgon instituted a price increase of approximately 2 percent in 2005, but it appears that this

increase did not cover substantial increases in the costs of raw materials (primarily coal) and a smaller

increase in energy costs.148 We therefore find evidence of price suppression in the form of a cost-price

squeeze in 2005, when the COGS to net sales ratio was at its highest levels.

Confirmed lost sales and lost revenues provide additional support for our finding that subject

imports have suppressed prices to a significant degree. Petitioners provided *** lost sales allegations and

*** lost revenue allegations. Commission staff confirmed $*** in total lost sales and $*** in annual lost

revenue.149 By and large, price was the reason given for choosing the Chinese product.150 These

confirmed lost sales and revenues indicate that competition from subject imports prevented domestic

producers from raising prices to cover increases in costs, even as demand increased over the period of

investigation.

For the foregoing reasons, we find in the preliminary phase of this investigation that the subject

imports have had significant adverse effects on domestic prices.
 151 In its notice of initiation of the antidumping duty investigation, Commerce estimated the dumping margins for

subject imports from China to range from 114.33 percent to 333.66 percent. 71 Fed. Reg. at 16759.

 152 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.”). SAA at 885.

 153 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).

 154 Although Calgon acknowledges it is one of the largest importers of certain activated carbon from China,

accounting for *** percent of total subject imports by quantity in 2005, Calgon states that its subject imports ***. 

Petitioners’ Postconference Brief at 28. We note that Petitioners’ reported imports of certain activated carbon were

equivalent to *** percent of the total subject imports by quantity in 2005. CR/PR at Table IV-2. Calgon contends

that it was forced to begin importing certain activated carbon from China because its customers urged it to do so in

the face of extremely low prices from China. Tr. at 23-24 (O’Brien). CIAC argues that Petitioners were not forced

to import subject merchandise due to competition from subject imports. Rather, they chose to develop activated

carbon plants in China and import subject merchandise at the expense of their domestic production. By this strategy,

CIAC argues that Petitioners avoided the high cost of raw materials and natural gas in the United States. Tr. at 176-

177 (Skeini).

 155 Production increased from *** million pounds in 2003 to *** million pounds in 2004 and then fell to ***

million pounds in 2005. CR/PR at Table C-1. 

 156 U.S. commercial shipments declined from *** million pounds in 2003 to *** million pounds in 2004, and then

increased to *** million pounds in 2005. CR/PR at Table C-1.

 157 CR at II-2, II-3; PR at. Due to the capital intensive nature of the production process, certain activated carbon

plants are designed to run continuously at full capacity, except for scheduled maintenance shutdowns. Tr. at 38-39

(Hudgens). Despite increasing demand for certain activated carbon throughout the period of investigation, lowpriced competition from Chinese imports have forced U.S. producers to reduce prices (or not raise them) to maintain

volumes, rather than cut sales. By 2005, contract prices could not ***. CR at VI-1, PR at VI-I. 

 158 The average number of production workers decreased from *** in 2003 to *** in 2004 and further to *** in

2005. Hours worked decreased from *** thousand in 2003 to *** thousand in 2004, and were slightly higher at ***

thousand in 2005. CR/PR at Table C-1. Petitioners claim that Calgon closed a production line in 2003 because of

subject import competition. Petitioners’ Postconference Brief at 47; Tr. at 23 (O’Brien). 

22

D. Impact of the Subject Imports151

Section 771(7)(C)(iii) provides that the Commission, in examining the impact of the subject

imports on the domestic industry, “shall evaluate all relevant economic factors which have a bearing on

the state of the industry.”152 These factors include output, sales, inventories, capacity utilization, market

share, employment, wages, productivity, profits, cash flow, return on investment, 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.”153

We have examined performance indicators in trade and financial data for the domestic industry

producing certain activated carbon. These data indicate declining overall trends, which are most evident

in the financial data.154

Regarding trade data, we note that performance indicators were mixed over the period examined. 

U.S. producers’ production of certain activated carbon increased from 2003 to 2004, but decreased in

2005.155 Conversely, domestic producers’ total shipments of certain activated carbon declined from 2003

to 2004, but increased from 2004 to 2005.156 Overall industry capacity fell over the period of

investigation, while capacity utilization ***.157 The average number of production related workers and

hours worked for certain activated carbon experienced an overall decline from 2003 to 2005.158 Wages
 159 CR/PR at Table C-1.

 160 Productivity increased from *** pounds per hour in 2003 to *** pounds per hour in 2004, but fell to ***

pounds per hour in 2005. CR/PR at Table C-1. 

We also note that end-of-period inventories increased irregularly between 2003 and 2005. End-of-period

inventories increased from *** million pounds in 2003, to *** million pounds in 2004, then decreased to *** million

pounds in 2005. CR/PR at Table C-1. 

 161 CR/PR at Table C-1. Operating income decreased from $*** million in 2003 to $*** million in 2004, then

fell to *** million in 2005. 

 162 CR/PR at Table C-1. Respondents have argued that any adverse condition Calgon experienced in the second

half of 2005 was due to Hurricanes Rita and Katrina, and was unrelated to subject imports. CIAC’s Postconference

Brief at 46. The record indicates that Calgon suffered ***

 163 CR/PR at Table C-1. Net sales measured by quantity decreased from *** million pounds in 2003 to ***

million pounds in 2004, before increasing slightly to *** million pounds in 2005. Net sales measured by value

decreased from $*** million in 2003 to $*** million in 2004, before increasing to $*** million in 2005. 

 164 CR/PR at Table C-1. 

 165 CR/PR at Table C-1.

 166 CR/PR at Table VI-11.

23

paid increased slightly from 2003 to 2005.159 Productivity increased from 2003 to 2004, but was lower in

2005.160 

Many of the domestic industry’s consolidated financial indicators declined overall during the

period of investigation. Operating income, operating margins, and net sales measured by quantity and

value all declined, although capital expenditures and research and development expenditures increased

over the period examined.

Operating income fell steadily by *** percent from 2003 to 2005.161 The domestic industry’s

ratio of operating income to sales fell by *** percentage points from 2003 to 2005. Operating margins

declined from *** percent in 2003 to *** percent in 2004, and fell further to *** percent in 2005.162

Both net sales measured by quantity and value decreased irregularly by *** percent and ***

percent, respectively, from 2003 to 2005.163 As discussed previously, COGS as a ratio to sales steadily

increased from 2003 to 2005. COGS was *** percent of sales in 2003, and increased to *** percent of

sales in 2005.164

Capital expenditures for the domestic industry increased from $*** million in 2003 to $***

million in 2004 before increasing slightly to $*** million in 2005.165 Research and development

expenses increased from $*** million in 2003 to $*** in 2004 and remained flat in 2005.166

Declines in U.S. industry performance indicators occurred as subject imports entered the U.S.

market in increased and significant volumes, and gained market share almost exclusively at the expense

of the domestic industry. At the same time, subject imports undersold the domestic like product, typically

by double-digit margins, and suppressed domestic prices to a significant degree.

For purposes of this preliminary determination, we conclude that subject imports had an

 adverse impact on the condition of the domestic industry during the period of investigation. We find that

the absolute and relative volume of subject imports, as well as the underselling by the subject imports, are

significant. As subject imports captured market share, they suppressed domestic prices to a significant

degree, causing declines in the domestic industry’s financial performance, particularly at the end of the

period of investigation. Operating income, operating margins, and net sales measured by both quantity

and value, declined as the domestic industry lost market share.

 
24

CONCLUSION

For the reasons stated above, we find that there is a reasonable indication that an industry in the

United States is materially injured by reason of imports of certain activated carbon from China that are

allegedly sold in the United States at less than fair value.
 1

 In its notice of initiation, Commerce defined the subject product as follows:

“Certain activated carbon is a powdered, granular or pelletized carbon product obtained by “activating”

with heat and steam various materials containing carbon, including but not limited to coal (including bituminous,

lignite and anthracite), wood, coconut shells, olive stones, and peat. The thermal and steam treatments remove

organic materials and create an internal pore structure in the carbon material. The producer can also use carbon

dioxide gas (CO2) in place of steam in this process. The vast majority of the internal porosity developed during the

high temperature steam (or CO2 gas) activated process is a direct result of oxidation of a portion of the solid carbon

atoms in the raw material, converting them into a gaseous form of carbon. 

The scope of this investigation covers all forms of activated carbon that are activated by steam or CO2,

regardless of the raw material, grade, mixture, additives, further washing or post-activation chemical treatment

(chemical or water washing, chemical impregnation or other treatment), or product form. Unless specifically

excluded, the scope of this investigation covers all physical forms of certain activated carbon, including powdered

activated carbon (“PAC”), granular activated carbon (“GAC”), and pelletized activated carbon. 

Excluded from the scope of the investigation are chemically-activated carbons. The carbon-based raw

material used in the chemical activation process is treated with a strong chemical agent, including but not limited to

phosphoric acid, zinc chloride, sulfuric acid, or potassium hydroxide, that dehydrates molecules in the raw material,

and results in the formation of water that is removed from the raw material by moderate heat treatment. The activated

carbon created by chemical activation has internal porosity developed primarily due to the action of the chemical

dehydration agent. Chemically activated carbons are typically used to activate raw materials with a lignocellulosic

component such as cellulose, including wood, sawdust, paper mill waste and peat.

To the extent that an imported activated carbon product is a blend of steam and chemically activated

carbons, products containing 50 percent or more steam (or CO2 gas) activated carbons are within this scope, and

those containing more than 50 percent chemically activated carbons are outside this scope.

Also excluded from the scope are reactivated carbons. Reactivated carbons are previously used activated

carbons that have had adsorbed materials removed from their pore structure after use through the application of heat,

steam and/or chemicals.

Also excluded from the scope is activated carbon cloth. Activated carbon cloth is a woven textile fabric

made of or containing activated carbon fibers. It is used in masks and filters and clothing of various types where a

woven format is required.

Any activated carbon meeting the physical description of subject merchandise provided above that is not

expressly excluded from the scope is included within this scope.” 

The products under investigation are classifiable in Harmonized Tariff Schedule of the United States

(“HTS”) subheading 3802.10.00. Although HTS subheadings are provided for convenience and customs purposes,

the written description of the scope of this investigation is dispositive. HTS subheading 3802.10.00 has a normal

trade relations tariff rate of 4.8 percent ad valorem, applicable to imports from China. 71 FR 16757, April 4, 2006. 

 2 Federal Register notices cited in the tabulation are presented in app. A.

I-1

PART I: INTRODUCTION

BACKGROUND

This investigation results from a petition filed by Calgon Carbon Corporation (Calgon),

Pittsburgh, PA, and Norit Americas, Inc. (Norit), Marshall, TX, on March 8, 2006, alleging that an

industry in the United States is materially injured and threatened with material injury by reason of lessthan-fair-value (LTFV) imports of certain activated carbon1

 from China. Information relating to the

background of the investigation is presented in the following tabulation.2
 3

 The LTFV margin alleged in the petition, as recalculated by Commerce, ranges from 114.33 to 333.66 percent

(71 FR 16759, April 4, 2006).

 4

 A list of witnesses appearing at the conference is presented in app. B.

 5

 In the petition, the subject product was described as follows:

“Activated carbon is defined as a black carbon material obtained by “activating” various materials

containing high levels of carbon (including but not limited to coal, wood and coconut shells) by heating them and/or

treating them with chemicals. The thermal and/or chemical treatments remove organic materials and create a vast

internal pore structure in the carbon material. The pores trap contaminants in liquids or gases, a process called

adsorption. Adsorption of contaminants removes organic compounds from the surrounding air, gas or liquid

steams, and thereby helps purify the stream. Activated carbon may be added to a liquid (such as water, for example)

in a single use application to remove impurities and unwanted odors. It may also be used as the active agent in

filtration and purification systems in which the gas or liquid is passed through or over the activated carbon to trap

impurities. Typical uses of activated carbon include removing objectionable tastes and odors from drinking water;

organics reduction in waste water; removing color and impurities from foods, pharmaceuticals, wine, liquor, fruit

juices and chemicals; removing color from raw sugar in the refining stage; removing mercury and dioxins from flue

gas emissions; and gasoline vapor and solvent recovery systems.

Activated carbon is produced in the following three forms, as covered by this petition: (1) powdered

activated carbon (PAC), (2) granular activated carbon (GAC), and (3) pelletized activated carbon. Powdered

activated carbon is a pulverized material with particles predominately smaller than 80 mesh size. Pelletized

activated carbon consists of extruded and cylindrical shaped pellets.

Activated may also be spun into activated carbon cloth, a product that is not covered by this petition. Some

granular and pelletized activated carbon may be ‘reactivated’ after being used by having impurities thermally 

removed from the carbon, which renders the material able to be reused. Reactivated carbon is not the subject of this

petition..”

Activated carbon is classifiable in the Harmonized Tariff Schedule of the United States (“HTS”)

subheading 3802.10.00. Activated Carbon from China Petition, pp. 2-3. 

 6

 71 FR 5688, February 2, 2006.

 7

 71 FR 9155, February 22, 2006.

I-2

Date Action

March 8, 2006 . . . . . Petition filed with Commerce and the Commission;3

 institution of Commission

investigation (71 FR 13430, March 15, 2006)

March 30, 2006 . . . . Commission’s conference4

April 4, 2006 . . . . . . Commerce’s notice of initiation (71 FR 16757)

April 21, 2006 . . . . . Scheduled date for the Commission’s vote

April 24, 2006 . . . . . Commission determination due to Commerce

PREVIOUS INVESTIGATION

On January 26, 2006, petitioners in the instant investigation (Calgon and Norit) filed a petition 

alleging that an industry in the United States was materially injured and threatened with material injury

by reason of LTFV imports of activated carbon5

 from China. As a result of that filing, the Commission

instituted investigation No. 731-TA-1102 (Preliminary): Activated Carbon from China.6

 Subsequently,

on February 15, 2006, petitioners withdrew their petition at Commerce and the Commission. Commerce

had not initiated its investigation by that date and the Commission discontinued its investigation effective

that date.7
 8

 ***.

 9

 U.S. imports are based on official import statistics in tables C-2 and C-3, as well.

 10 One of the firms, Norit, ceased production of chemically activated carbon in 2005.

 11 Total activated carbon is certain activated carbon plus chemically activated carbon.

 12 In this section, the term activated carbon refers to both certain activated carbon (also referred to as steamactivated carbon) and chemically activated carbon.

 13 Petition, p. 13.

 14 Ibid.

 15 Mesh numbers refer to holes sizes in sieves used to separate granular materials. For example, an 80 mesh has

sieve openings that are nominally 0.177 mm. Lower mesh numbers typically have larger-sized holes. See, Petition,

p. 12.

 16 Petition, p. 12.

I-3

SUMMARY DATA

A summary of data collected in the investigation is presented in appendix C, tables C-1, C-2, and

C-3. For table C-1, except as noted, certain activated carbon U.S. industry data are based on

questionnaire responses of three firms that accounted for virtually all of U.S. production during 2003-05.8

U.S. imports are based on official import statistics.9

 For table C-2, except as noted, chemically activated

carbon U.S. industry data are based on questionnaire responses of two firms10 that accounted for all of

U.S. production during 2003-05. For table C-3, except as noted, total11 activated carbon U.S. industry

data are based on questionnaire responses of four firms that accounted for virtually all of U.S. production

during 2003-05.

THE SUBJECT PRODUCT

The imported certain activated carbon covered by the scope of this investigation is described in

detail in the “Background” section earlier in Part I. 

Physical Characteristics and Uses12

Activated carbon is a solid material comprised primarily of carbon that has been specially treated

to increase the porosity, and thus the surface area, of the material. The high surface area that results from

“activation” allows greater adsorption of chemical species onto the solid carbon. The surface area and

pore structure of activated carbon depend greatly on the raw materials and processing methods used. The

primary raw material for the production of activated carbon can be most any solid material that has a high

carbon content. Common raw materials for making activated carbon are coal, wood, coconut shells, olive

stones, and peat.13 In the United States and China, coal is the most often used raw material.14

Activated carbon is sold in three basic forms: powdered, granular, and pelletized. Powdered

activated carbon (PAC) is usually defined as being predominately material that passes through an 80

mesh.15 Granular activated carbon (GAC) has larger particles than PAC. The size range for GAC is

usually specified by two mesh numbers between which most of the material is retained. For example, an

8x30 GAC predominately contains particles that pass through an 8 mesh (2.38 mm sieve openings) but do

not pass through a 30 mesh (0.59 mm sieve openings).16 Pelletized activated carbon consists of uniformly
 17 ***.

 18 Ibid.

 19 Ibid.

 20 Since the iodine number is relatively simple to measure, it is often used as a substitute for surface area

measurements, which require specialized equipment and highly trained technicians. ***.

 21 See, testimony of Stephen Clark, Water Tech, Conference transcript, p. 167.

 22 Petitioners’ post-conference brief, p. 11.

 23 Frederick S. Baker, Charles E. Miller, Albert J. Repik, and E. Donald Tolles, “Carbon, Activated,” KirkOthmer Encyclopedia of Chemical Technology, John Wiley & Sons, Inc., 2003, Sections 10.

 24 Ibid., Section 10.

I-4

sized cylinders with typical diameters of 2 mm and lengths of 0.5 to 2 cm.17 The primary benefit of

pelletized activated carbon is that it produces a lower pressure drop over a fixed bed than GAC.18

Along with the size and shape of the activated carbon particles, factors that influence the

efficiency of activated carbon in a given application are surface area, pore size distribution, ash content,

and hardness.19 These properties depend on the raw materials used as well as the activation process. The

surface area and pore size distribution are related properties that determine how much of the desired

chemical species will adsorb onto the activated carbon. Two characteristics of a given activated carbon

sample that are related to the pore size distribution and surface area are the iodine number and the

molasses number. Iodine number measures the mass of iodine that is absorbed from a standard solution

by a given mass of activated carbon and is usually reported in units of milligrams of iodine absorbed per

gram of activated carbon.20 Since iodine is a small molecule, the iodine number indicates the abundance

of small diameter pores in the activated carbon. Molasses number measures the efficiency with which a

sample of activated carbon removes the color-inducing molecules from a mixture of molasses and water. 

Since the molecules that give molasses its color are large, relative to iodine, the molasses number

measures the abundance of medium- to large-sized pores. A purchaser of activated carbon chooses an

appropriate pore size distribution based on the size (and chemical properties) of the chemical species to be

captured. Ash content of activated carbons varies greatly according to the raw material used to produce

it. Since the ash is inorganic material that cannot be “activated,” a higher ash content reduces the

effectiveness of a given mass of activated carbon. Manufacturers generally control ash content by

selecting low-ash starting materials. If a higher-ash raw material is used, it may be subjected to an acid

wash step to reduce the ash content after activation. Hardness is an important property for specifying

granular activated carbon. Harder activated carbons produce fewer fines during shipping and use. In

some applications, generation of fines can be problematic.21 Because chemically activated carbon is

generally made using wood, it has lower hardness than certain activated, coal-based, carbon. Chemically

activated carbons are generally powdered or pelletized due to their lower hardness.22

The primary use for activated carbon is in the separation of small concentrations of chemical

species from liquid and gas streams. Because activated carbon has a low affinity for water but strongly

absorbs organic and sulfur-containing chemicals, it is widely used to remove undesirable tastes and odors

from drinking water and to eliminate contaminants from industrial waste water.23 In the processing of

foods (e.g., sugar, corn syrup, and vegetable oils), pharmaceuticals, and alcoholic beverages, activated

carbon is used to remove unwanted color and impurities. Activated carbon is also used in the chemical

process industries for solvent recovery. Applications of activated carbon in gas-phase systems include air

purification, automobile emissions reduction, and solvent vapor recovery.24
 25 Thermally activated carbon is often referred to as steam-activated carbon. For purposes of this report, the term

“certain activated carbon” should be viewed as thermally/steam activated carbon.

 26 Petition, p. 72; See, testimony of Ron Thompson, Norit, conference transcript, p. 29; *** importers’

questionnaire responses, Question II-7.

 27 Some importers’ questionnaire responses and conference testimony state either that there are no differences in

the physical characteristics of chemically and certain activated carbon or that there is as much variation among

certain activated carbons as there is between chemically and certain activated carbons. *** importers’ questionnaire

responses, Question II-7; See, testimony of J. Louis Kovach (NUCON), conference transcript, p. 107.

 28 Emissions canisters in automobiles capture gasoline vapors from the fuel tank while the engine is off. When

the engine is running, hot gases pass through the canister, remove the adsorbed gasoline vapors, and carry them to

the engine for combustion. The larger-sized pores in chemically activated carbon may allow it to perform better than

certain activated carbon in this task. See, testimony of Timothy Wruble, Norit, conference transcript, p. 66.

 29 While the U.S. automobile makers predominately use chemically activated carbon at this time, certainactivated carbon was used in this application prior to the 1980s. See, testimony of Robert O’Brien, Calgon,

conference transcript, p. 67. Some automakers outside the United States use certain activated, coal-based, carbon in

this application. See, testimony of Anders Skeini, Jacobi, conference transcript, p. 162.

 30 See, testimony of Dennis Rester, Norit, conference transcript, p. 83.

 31 U.S. EPA, http://www.epa.gov/mercuryrule/basic.htm, retrieved April 5, 2006.

 32 See, testimony of Sid Nelson, Sorbent, conference transcript, p. 132.

 33 Thomas J. Feeley, III, Lynn A. Brickett, B. Andrew O’Palko, and James T. Murphy, “Field Testing of Mercury

Control Technologies for Coal-fired Power Plants”, U.S. Department of Energy/National Energy Technology

Laboratory, May 2005, http://www.netl.doe.gov/technologies/coalpower/ewr/pubs/mercuryR%26D-v4-0505.pdf,

retrieved March 30, 2006.

 34 Ibid.

 35 Norit America, Inc., Material Safety Data Sheet, Activated Carbon,

http://www.norit-americas.com/pdf/MSDS117_rev4.pdf, retrieved March 14, 2006.

I-5

There are two activation processes for producing activated carbon: thermal processing25 and

chemical processing. (See subsequent section for a discussion of the production processes.) Petitioners

claim that the different processing methods produce different products that are used in separate

applications. In general, chemically activated, wood-based carbons have more large- and medium-sized

pores than certain activated, coal-based, carbons.26 27 According to the petitioners, this property makes

chemically activated carbons more suitable for certain applications, including emissions canisters that

capture gasoline vapors from automobile fuel tanks.28 29 Chemically activated carbons may also retain

some of the activating agent (usually phosphoric acid or zinc chloride) that could leach out during

processing and may make them unacceptable for certain applications such as aquarium filters or

pharmaceutical purification.30

One use of activated carbon that may increase greatly in the future is the control of mercury

emissions from coal-fired power plants. In 2005, the U.S. Environmental Protection Agency (EPA)

issued the Clean Air Mercury Rule to cap and reduce mercury emissions from coal-fired power plants. 

When fully implemented, this regulation will reduce mercury emissions by nearly 70 percent.31 Many

states are also enacting limits for mercury emissions.32 To meet the final mercury emissions cap, it is

likely that a new mercury control technology will be needed.33 While still in the demonstration stage of

development, injection of powdered activated carbon into the flue gas from coal-fired plants has to this

point shown the most promise for meeting the mercury emissions cap.34

Activated carbon is non-toxic and has no adverse environmental effects.35 However, once the

activated carbon has been used, it may take on the toxicity of adsorbed materials. Like nearly all
 36 See, testimony of Timothy Wruble, Norit, conference transcript, p. 99.

 37 In this section, the term activated carbon refers to both certain activated carbon (also referred to as steamactivated carbon) and chemically activated carbon.

 38 MeadWestvaco produces chemically activated carbon from wood. Norit also produced chemically activated,

wood-based carbon until January 2005.

 39 Petition, p. 71.

 40 ***.

 41 A rotary kiln consists of a long cylindrical combustion chamber that is slightly tilted from horizontal. The

material to be burned is added to the elevated end of the kiln. The tilt and rotation of the combustion chamber move

the material out the opposite end. Residence time is controlled by the feed and rotation rates.

 42 Petition, p. 14.

 43 A multiple hearth kiln consists of a vertical column with grates at various heights in the column. Solid

materials are fed into the top of the kiln and arms attached to a rotating center shaft push the material to the lower

grates. Steam and/or air are fed into the bottom of the kiln. The residence time of the solid material in the kiln is

determined by the rotation rate of the center shaft and by the feed rate, which controls the bed height on each grate.

 44 Petition, p. 14.

I-6

powdered and granular materials, eye or skin exposure to activated carbon may cause mild irritation. 

Inhalation of the dust from powdered or granular activated carbon may cause irritation of the respiratory

track. Activated carbon is generally packaged and stored in plastic bags at weights ranging from 25

pounds to 2,000 pounds. Bags of activated carbon are shipped either by rail or truck. Bulk delivery by

truck is also common.36

Manufacturing Facilities37

The process of making activated carbon differs based on the starting material used and whether

the carbon is thermally or chemically activated. The two most common methods for producing activated

carbon in the United States are thermal activation (also called steam activation) of coal, which is the

process that the petitioners, Calgon and Norit, use, and chemical activation of wood.38 A small amount of

certain activated, wood-based, carbon, ***, is also produced domestically.39

Two commonly used processes for thermally activating coal are direct activation and

reagglomeration. These processes only differ in the initial treatment of the coal. In direct activation, the

coal is simply crushed to the desired size before undergoing subsequent processing steps. For

reagglomeration, the coal is first crushed, then mixed with a binder, such as coal tar or petroleum pitch,

and finally pressed into briquettes. These briquettes are crushed to the desired size before beginning the

carbonization and activation process. To make pelletized carbon in either of these processes, the crushed

starting material is mixed with a binder and extruded to produce cylinders that are typically 2 mm in

diameter and 0.5 to 2 cm in length.40

For both direct activation and reagglomeration, the crushed material is added to one or more

rotary kilns41 for the carbonization step. The raw material is heated in the kiln, in the absence of oxygen,

to approximately 400 degrees Celsius.42 During this step, the water and volatile organic compounds are

vaporized and removed from the kiln in the exhaust gases. The charred material is removed from the kiln

after approximately six hours, ready for the activation step.

In thermal activation, the carbonized material is transferred to a rotary kiln or multiple hearth

kiln.43 The kiln is maintained at a temperature of approximately 1,000 degrees Celsius.44 An oxidizing
 45 Carbon dioxide, CO2, may also be used as an oxidizing agent.

 46 In addition to phosphoric acid, other chemicals such as zinc chloride, sulfuric acid, or potassium hydroxide can

be used to chemically activate steam. Zinc chloride is no longer used in the United States because of environmental

concerns regarding zinc. Petition, p. 16.

 47 Baker, et al., “Carbon, Activated,” Sections 10 and 11.

 48 Petition, p. 17.

 49 Baker, et al., “Carbon, Activated,” Section 3.

 50 Ibid.

 51 See, testimony of Joe Enniking (NUCON), Conference transcript, p. 193.

I-7

agent, usually steam,45 is fed to the kiln. The high surface area of activated carbon is created in this step

as the reaction between steam and carbon removes much of the material and leaves a porous structure. 

Variables such as the pore size and surface area are controlled by the kiln temperature and residence time

of the material. After the activated carbon is removed from kiln, it can be milled and screened to final

size and packaged for sale.

In the chemical activation of wood, an activating agent, typically phosphoric acid,46 is added to

sawdust before it is added to a rotary kiln. Both the carbonization process and the activation process take

place in this kiln. The activating agent extracts moisture, reduces tar formation, and generates an open

pore structure.47 The pores created by chemical activation are generally larger than the pores formed

during thermal activation.48 The yield of activated carbon is generally 50 percent by weight of the raw

material for chemical activation compared to 30 to 35 percent by weight for thermal activation.49

After activation, certain activated and chemically activated carbons can be further treated

depending on the application for which it will be used. Two common treatments are acid washing, which

is usually only used for certain activated carbon, and impregnation with metals. Acid washing is often

used for certain activated carbons that have a high ash content.50 Washing the certain activated carbon

with hydrochloric or other acids removes minerals and ash resulting in a higher purity product. Acidwashed, certain activated carbons are often used in applications where process streams are acidic, such as

purification of corn syrup. For some speciality applications, the activated carbon, either thermally or

chemically activated, may be impregnated with metals or other chemicals. The impregnation would give

the activated carbon the ability to adsorb a particular impurity or catalyze a desired reaction.

In some instances, used activated carbon can be “reactivated.” Carbon is reactivated by thermally

or chemically removing chemical species adsorbed onto the spent carbon. Reactivation is usually

performed on granular or pelletized activated carbon and is rarely used on powdered activated carbon. 

Reactivation is often done by the end user and then reused by the same user. However, there are some

firms who take spent carbon from the end user, reactivate it, and return it to the original user. In

processes where environmentally regulated chemicals are being captured on activated carbon, strict

bookkeeping of the amount of regulated chemical produced and how it is disposed of is required. For this

reason, firms that reactivate carbon for a user usually process the carbon as single batch and return the

same carbon to the user. In some applications, such as using activated carbon to capture molecules in the

gas-phase, there is little risk that residual species in reactivated carbon will leach into the process. In

these applications, it is possible for spent carbons from different users to be mixed together, reactivated,

and sold to yet another user as “pooled” reactivated carbon.51

Interchangeability and Customer and Producer Perceptions

Nearly all producer and importer questionnaire respondents reported that there was at least some

interchangeability between Chinese and U.S.-produced certain activated carbon. *** reported that there
 52 *** reported that reactivated carbon is a substitute for certain activated carbon.

 53 No imports of reactivated carbon were reported by any importers.

 54 Petitioners’ postconference brief, p. 4.

 55 Coalition of Importers of Activated Carbon’s (CIAC) postconference brief, p. 1.

 56 In the producer and importer questionnaires in this investigation, the Commission asked producers and

importers to comment with respect to the differences and similarities between certain activated carbon and

chemically activated carbon. Those responses are presented in appendix D.

 57 CIAC postconference brief, p. 9.

I-8

are no direct substitutes for certain activated carbon.52 For importers, the most commonly mentioned

substitute was reactivated carbon which sells at a lower price than certain activated carbon.53 Six

importers suggested chemically activated carbon as a substitute in certain applications (e.g, water

purification, decolorization, air treatment, etc.), although it is perceived as commanding a higher price

than certain activated or reactivated carbon. More detailed information on interchangeability and

customer and producer perceptions can be found in Part II of this report, Conditions of Competition in the

U.S. Market.

Channels of Distribution

For the most part, shipments of certain and chemically activated carbon by both U.S. producers

and imports went to end users. Over 90 percent of shipments by U.S. producers in both product

categories went to end users during the period examined, while nearly 70 percent of shipments of certain

activated Chinese product by U.S. importers went to the end user category and more than *** percent of

chemically activated Chinese product went to end users. More detailed information on channels of

distribution can be found in Part II of this report, Conditions of Competition in the U.S. Market.

Price

Information with regard to prices of certain activated carbon is presented in Part V of this report,

Pricing and Related Information. 

DOMESTIC LIKE PRODUCT ISSUES

During this investigation, petitioners have argued that the Commission should define the

domestic like product as certain activated carbon, which is all steam (or gas) activated carbon other than

chemically activated carbon, activated carbon fabric, and reactivated carbon, coextensive with the scope

of the investigation.54 Respondents, on the other hand, have urged the Commission to define the domestic

like product more broadly to include chemically activated carbon.55 56 For purposes of the preliminary

determination, no party has taken the position that the Commission should expand the like product to

include reactivated carbon.57 Nevertheless, respondents argue that the reality is that reactivated carbon is

part of the same like product as certain- and chemically activated carbon.

The respondents argue that there is no clear dividing line between certain activated carbon and

chemically activated carbon. They contend that there are a number of different types of activated carbon

with unique composition. However, within the same type or form of carbon (such as pelletized,

powdered, impregnated), the physical characteristics and uses of domestically produced certain activated

carbon and domestically produced chemically activated carbon are identical. According to the

respondents, certain activated carbon and chemically activated carbon within the same type are each used
 58 Ibid., p. 5.

 59 Ibid., p. 6.

 60 Petitioners’ postconference brief, pp. 14-15.

 61 Ibid., p. 15. 

 62 Ibid., p. 16. Norit’s chemically activated production was located in Marshall, TX, separate from its certain

activated production facility.

I-9

to trap contaminants in liquids or gases through adsorption, and cannot be physically distinguished from

each other. 

Respondents contend that certain activated carbon and chemically activated carbon are

interchangeable as evidenced by the fact that they are often blended together.58 Furthermore, the

respondents state that several companies, including ***, have certain activated carbon products which are

currently marketed or sold for use in the automotive industry. Some of these products compete directly

with ***.59 

With respect to channels of distribution, respondents contend that these are the same as

demonstrated by the fact that most sellers of certain activated carbon also market and sell chemically

activated carbon. The respondents also argue that the manufacturing facilities and production processes

are extremely similar, and while there are alternative methods, the production methods only diverge in the

second step of the activation process.

Petitioners contend that certain activated carbon and chemically activated carbon can be

distinguished by the type of raw material generally used and the physical characteristics. Petitioners state

that the vast majority of certain activated carbon domestically produced and imported from China, is

made from some form of coal. On the other hand, all domestically produced chemically activated carbon

uses wood or a wood-based product as raw material. The different activation processes, petitioners assert,

create a difference in physical characteristics such as pore structure, size, and size distribution. 

Additionally, petitioners state that the structure of certain activated carbons is mechanically stronger than

that of chemically activated carbons, making steam better suited for applications in which the carbon is

subject to pressure or friction and chemically better suited for use in membrane technologies.

Petitioners argue that given the aforementioned differences in physical characteristics, as well as

the presence of activation chemicals, and the higher cost structure and price of chemically activated

carbon, the theoretical and actual interchangeability of chemically activated carbon is limited.

Additionally, the petitioners contend that there is no substitution, in spite of respondents’ arguments to

the contrary, between certain activated carbon and chemically activated carbon in the automotive market,

the largest market for chemically activated carbon.60

The petitioners note that they seldom compete with, and have different customer bases than

MeadWestvaco, as evidence that there are differences in channels of distribution and differing perceptions

by customers and producers of certain activated carbon and chemically activated carbon. Also, they point

to MeadWestvaco’s lack of interest in the investigation as further evidence of differences in perceptions. 

In addition, the petitioners contend that certain activated carbon is often viewed as more of a commodity

product and often sold on the basis of price alone, while chemically activated carbons are sold on the

basis of performance over price.61

With regard to manufacturing facilities and production processes, the petitioners assert that

chemically activated carbons are produced using different equipment in different facilities. They note

that when Norit produced both certain activated carbon and chemically activated carbon, it did so in

separate production facilities.62 The petitioners maintain that the certain activated carbon production

process differs from that of chemically activated carbon in that it involves an initial carbonization
 63 Ibid.

 64 Ibid., p. 17.

I-10

process.63 Furthermore, they contend that the activation processes involved are completely different, with

steam activation requiring higher temperatures and the presence of steam to carve out carbon atoms. On

the other hand, chemical activation relies on the application of a dehydrating agent and lower temperature

to open up the internal structure of the carbon. The petitioners argue that these differing processes result

in differences in the final product on which it is graded, and which dictates its performance and

application.64
II-1

PART II: CONDITIONS OF COMPETITION IN THE U.S. MARKET

U.S. MARKET SEGMENTS

Both U.S. producers’ U.S. commercial shipments of certain activated carbon as well as U.S.

shipments of imported product from China are made primarily to end users. Types of end users include

municipal water treatment facilities, food processing plants, and chemical processing plants. 

Markets do not appear to be limited geographically with all three responding producers reporting

nationwide sales. Fifteen of 30 responding importers also reported nationwide sales with another five

reporting sales to at least four regions.

CHANNELS OF DISTRIBUTION

*** of certain activated carbon, as well as 11 of 26 responding importers, reported sales to both

distributors and end users of certain activated carbon. Twelve importers and *** reported sales only to

end users while three importers reported sales only to distributors. The *** of U.S. producers’ U.S.

shipments of certain activated carbon were shipped directly to end users throughout the period for which

data were collected. Approximately *** percent of U.S. producers’ U.S. shipments went to end users in

each year between 2003 and 2005. A *** share of importers’ U.S. shipments went to distributors, with

shipments to end users accounting for between 64 and 74 percent of U.S. imports from China during the

period 2003 to 2005. *** suggested that sales to distributors are often made at a discount due to lower

cost of sale involved in such transactions. To the extent that this is true, it may place a downward bias on

the observed price of imported certain activated carbon which is more frequently sold to distributors. 

Table II-1 presents information on channels of distribution for U.S. producers as well as for U.S. imports

of subject product from China.

Table II-1

Certain activated carbon: U.S. producers’ and U.S. importers’ U.S. shipments by channels of

distribution, 2003-05

Shipments

Calendar year

2003 2004 2005

U.S. producers’ U.S. shipments (in short tons)

To distributors *** *** ***

To end users *** *** ***

U.S. importers’ subject U.S. shipments (in short tons)

To distributors 14,879 22,308 26,235

To end users 42,093 49,698 46,834

Share of U.S. producers’ U.S. shipments (in percent)

To distributors *** *** ***

To end users *** *** ***

Share of U.S. importers’ subject U.S. shipments (in percent)

To distributors 26.1 31.0 35.9

To end users 73.9 69.0 64.1

Source: Compiled from data submitted in response to Commission questionnaires.
 1

 See table III-1 for additional details concerning capacity and capacity utilization. 

 2

 Petitioners’ postconference brief, p. 31.

 3 See, testimony of Brad Hudgens, Georgetown Economic Services, conference transcript, pp. 38-39.

 4

 See table III-1. 

 5

 ***.

II-2

SUPPLY AND DEMAND CONSIDERATIONS

U.S. Supply

Domestic Production

Based on available information, staff believes that U.S. certain activated carbon producers are

likely to respond to changes in demand with moderate to large changes in shipments of U.S.-produced

certain activated carbon to the U.S. market. A small amount of unused capacity as well as limited ability

to shift production to and from alternative products suggest a low degree of responsiveness, while the

existence of alternative markets, ***, and moderately high inventories suggest a higher degree of

responsiveness. 

Industry capacity

Total U.S. capacity ***. U.S. producers’ reported capacity utilization for certain activated carbon

***. Overall, the level of capacity utilization indicates that U.S. producers of certain activated carbon

have *** in the event of a price change.1

 However, according to Petitioners’ postconference brief, ***.2

According to testimony at the staff conference, high levels of capacity utilization are necessary to keep

costs low.3

Alternative markets

Overall, domestic producers’ exports fell *** between 2003 and 2005 but ***.4

 ***.5 The

generally *** level of exports during the period indicates that domestic producers ***. 

Inventory levels

Moderate inventories relative to total shipments indicate that U.S. producers are able to respond

to changes in demand simply by increasing shipments from inventory. According to questionnaire

responses, U.S. producers’ aggregate beginning inventories were *** percent of annualized total

shipments in 2005. Table III-1 presents complete inventory data for U.S. producers. 

Production alternatives

***. *** reported that some production personnel will occasionally work on reactivating carbon. 

*** reported that reactivated carbon accounts for *** percent of production by the personnel that produce

certain activated carbon. The *** reported producing certain activated carbon on the same machinery and

using the same employees as does production of reactivated carbon. This producer reported that

reactivated carbon accounted for *** percent of production using this machinery and these employees. 

Testimony by witnesses for the respondent parties during the staff conference indicated that the same
 6 See, testimony of J. Louis Kovach, Nucon, conference transcript, p. 110.

II-3

equipment (specifically, the furnace) can be used to both activate virgin carbon and reactivate previously

activated carbon with some cleaning and adjustment between production of the two products.6

Subject Imports

Imported certain activated carbon from China as a share of total U.S. imports of certain activated

carbon fell from 64.6 percent in 2003 to 60.1 percent in 2005. Between 2003 and 2004, U.S. subject

imports from China rose from 67.7 million pounds in 2003 to 82.9 million pounds in both 2004 and 2005. 

As a share of total U.S. consumption, subject imports from China rose from 26.8 percent in 2003 to 30.2

percent in 2004 before falling slightly to 29.1 percent in 2005. Based on available information, importers

of certain activated carbon from China are likely to respond to changes in demand with moderate to large

changes in the quantity shipped to the U.S. market. A large response is supported by the existence of

alternative markets while the response is limited by small to moderate levels of inventory, a high capacity

utilization rate, and an inability to produce other products using the same equipment with which certain

activated carbon is produced. 

Industry capacity 

From 2003 to 2005, reported Chinese capacity grew from 197.5 million pounds to 274.1 million

pounds (see table VII-1). Production more than kept pace with the growth in capacity as capacity

utilization rose from 90.8 percent in 2003 to 92.0 percent in 2005. These data indicate that Chinese

suppliers of certain activated carbon have some excess capacity with which they could increase

production of certain activated carbon in the event of a price change.

Alternative markets 

According to questionnaire responses from Chinese producers of certain activated carbon, exports

to the United States accounted for 24.3 percent of all exports of certain activated carbon from China in

2005, down from 28.3 percent in 2004. Chinese producers, therefore, have the ability to divert product to

or from other markets in response to relative changes in the price of certain activated carbon between the

United States and other markets.

Inventory levels

Chinese producers’ inventories, as a share of total shipments, fell from 8.8 percent in 2003 to 4.6

percent in 2004 before rising again to 6.9 percent during 2005. These data indicate that these producers

have some ability to use inventories as a means of increasing shipments of certain activated carbon to the

U.S. market. 

Production alternatives

Only one of 24 responding Chinese producers indicated that they produced other products using

the same equipment used to produce certain activated carbon. This foreign producer reported that certain

activated carbon accounted for 85 percent of production using this equipment. It appears that Chinese

producers are constrained in their ability to switch capacity to or from alternative products in the event of

a change in demand for certain activated carbon.

U.S. Demand
 7

 CIAC postconference brief, pp. 21-22. 

 8

 Petitioners’ postconference brief, pp. 25-26 and exhibit GENERAL-6. 

 9

 ***.

II-4

Based on available information, certain activated carbon consumers are likely to respond to

changes in the price of certain activated carbon with moderate changes in their purchases of certain

activated carbon. The main contributing factor to the responsiveness of demand is the availability, or, in

some cases lack thereof, of substitute products that can compete with certain activated carbon. 

Specifically, since reactivation of used carbon is a viable alternative for many customers, an increase in

the price of virgin activated carbon may lead to more widespread use of reactivated product. However,

the ability of end users to use reactivated product is not universal and many end users can use only virgin

activated carbon. In addition, a substantial increase in the price of certain activated carbon may lead to

more direct competition with the higher-priced chemically activated carbon which is a viable substitute

for a number of end uses.

Demand Characteristics

Available data indicate that apparent U.S. consumption of certain activated carbon rose from ***

in 2003 to *** in 2005, an increase of 12.8 percent.

When asked if demand for certain activated carbon had changed since 2002, *** responding

major producers and 26 of 28 responding importers reported that demand had increased between 2003

and 2005. *** and two importers stated that demand has been growing consistently at 3 to 5 percent per

year. The most commonly cited reason for the increase is stricter EPA regulations regarding the treatment

of water as well as the emission of pollutants. In addition, respondent interested parties state that new

legislation regarding mercury emissions by power plants may be the source of a substantial increase in

demand for certain activated carbon.7

 One importer reported that demand had decreased and one importer

reported that demand has been unchanged.

Substitute Products

*** reported that no direct substitutes exist. ***. Twenty-two of 27 responding importers

reported that there are substitutes for certain activated carbon while five stated that there are no

substitutes. The most widely reported substitute was reactivated carbon which was mentioned by 15

responding importers. Six importers listed chemically activated carbon as a substitute. Both reactivated

and chemically activated carbon are reported by importers to be adequate substitutes in almost all

applications in which certain activated carbon is used. For end users such as potable water treatment

facilities, only reactivated carbon resulting from the reactivation of carbon from that specific customer

can be used. Other customers can purchase “pooled” reactivated carbon which can originate from a

variety of sources. Estimates provided by the petitioners indicate that reactivated carbon is 25 to 75

percent less expensive than virgin certain activated carbon.8

 While chemically activated carbon can often

be used in the same applications as certain activated carbon, the price is substantially higher. ***.9

 In

addition, for most applications that use chemically activated carbon (such as applications within the

automotive industry), certain activated carbon does not meet the required specifications. Other substitutes

listed more than once were ion exchange resins, zeolite, and clay. 
 10 See, testimony of Sid Nelson, Sorbent, conference transcript, p. 174.

 11 See, testimony of David Jordan, U.S. Filter Environmental Services, conference transcript, p. 119.

 12 Petitioners’ postconference brief, exhibit 1 p. 16.

 13 CIAC postconference brief, pp. 25-26. 

 14 Petitioners’ postconference brief, p. 34. 

II-5

Cost Share

One producer reported that certain activated carbon accounts for ***. Other responding U.S.

producers did not provide any information on this issue. Responding importers reported a wide range of

estimates concerning the share of certain activated carbon costs in all end-use related costs. These

estimates ranged from 0.01 percent to 90 percent for a variety of end uses. For the largest end use - water

treatment - estimates of the cost share attributable to certain activated carbon ranged from 25 percent to

80 percent with several importers stating that the cost share for this end use was around 50 percent. 

SUBSTITUTABILITY ISSUES

Factors Affecting Purchasing Decisions

It is generally agreed that as long as certain activated carbon meets the specifications required for

the specific end use in question, then price is the largest single factor affecting purchase decisions. There

may, however, be some differences in quality between domestically produced product and product

imported from China. During the staff conference, representatives for the respondent interested parties

reported that U.S.-produced certain activated carbon is often more effective and therefore requires less

product for the same end use than Chinese-produced product.10 Some end users require certain activated

carbon with a lower ash content than is available with unwashed Chinese product. In such cases, the

Chinese product must be acid-washed to remove ash and meet the required specifications. According to

an industry witness appearing on behalf of respondent interested parties at the staff conference, such

washing may increase costs by 30 to 40 percent.11 Finally, many orders of granular certain activated

carbon (***12) include removal of old product along with installation of new product. Service costs,

therefore, may influence the purchase decision along with the cost of the certain activated carbon itself.

While not federally mandated in this industry, many municipalities enact their own “Buy

America” regulations to certain activated carbon. Respondents claim that a substantial portion (20 to 30

percent) of municipal water treatment facilities purchase only U.S.-produced product.13 Petitioners state

that they believe these estimated percentages to be “overblown.” In addition, they report that many of

these “Buy America” policies are informal and could be ignored should price differences between

domestic and imported product become too great.14

Comparisons of Domestic Products, Subject Imports, and Nonsubject Imports

Producers and importers were asked to report how frequently certain activated carbon from

different countries was used in the same applications (table II-2). Both responding producers and 3 of 28

responding importers who reported having knowledge of both Chinese and U.S.-produced certain

activated carbon reported that Chinese and U.S. certain activated carbon are always interchangeable. Five

importers reported that product from the two countries is frequently interchangeable while 19 importers

reported that product from China is sometimes interchangeable with U.S.-produced certain activated

carbon and one reported that they were never interchangeable. While one importer cites quality issues as

the reason for imperfect interchangeability (in that the Chinese product is of lower quality), most
II-6

importers simply state that different products are more or less suitable for certain end uses as a result of

differences in inputs or production processes that produce different product characteristics. In addition,

several stated that no pelletized certain activated carbon is produced in the United States, whereas it is

produced in China. Reported comparisons involving nonsubject countries follow similar patterns and can

be seen in table II-2. One importer noted that coconut-shell based product is more readily available from

nonsubject countries. 

Table II-2

Certain activated carbon: U.S. producers’ and importers’ perceived degree of interchangeability of

products produced in the United States and other countries1

Country comparison

U.S. producers U.S. importers

AFSN0AFSN 0

U.S. vs. China 2 0 0 0 1 3 5 19 1 2

U.S. vs. Nonsubject 2 0 0 0 1 3 2 11 3 8

China vs. Nonsubject 2 0 0 0 1 4 2 10 2 8

1

 Producers and importers were asked if certain activated carbon produced in the United States and in other countries is used

interchangeably.

Note: “A” = Always, “F” = Frequently, “S” = Sometimes, “N” = Never, and “0” = No familiarity.

Source: Compiled from data submitted in response to Commission questionnaires.

Producers and importers were also asked to assess how often differences other than price were

significant in sales of certain activated carbon from the United States, China, or nonsubject countries

(table II-3). 

Table II-3

Certain activated carbon: U.S. producers’ and importers’ conceptions concerning the importance

of non-price differences in purchases of certain activated carbon from the United States and other

countries1

Country comparison

U.S. producers U.S. importers

AFSN0AFSN 0

U.S. vs. China 0 0 0 2 1 7 11 6 4 2

U.S. vs. Nonsubject 0 0 0 2 1 5 7 1 4 9

China vs. Nonsubject 0 0 0 2 1 5 7 1 3 8

1

 Producers and importers were asked if differences other than price between certain activated carbon produced in the United

States and in other countries are a significant factor in their firm’s sales of the product.

Note: “A” = Always, “F” = Frequently, “S” = Sometimes, “N” = Never, and “0” = No familiarity.

Source: Compiled from data submitted in response to Commission questionnaires.
II-7

*** responding producers as well as four of 28 responding importers reported that non-price

differences are never a factor in sales of certain activated carbon from the United States and China. Seven

importers reported that such differences are always a factor, while 11 reported that such differences are

frequently a factor and six reported that non-price differences were sometimes a factor. Importers listed

quality, availability, particular product characteristics, and technical support as factors other than price

that may influence their purchase decisions. One importer stated that U.S.-produced certain activated

carbon is of higher quality. Several others stated that availability, especially for “specialty” products, is

superior for importers of Chinese certain activated carbon. Two producers and four importers reported

that non-price difference were never a factor when comparing U.S. product to certain activated carbon

from nonsubject countries, while two producers and three importers stated that non-price differences were

never a factor when comparing Chinese certain activated carbon to nonsubject product. Twelve

importers stated that non-price differences were either always or frequently a factor in purchase decisions

involving product from nonsubject countries and one importer reported that such differences were

sometimes a factor. Several importers noted that certain activated carbon made from coconut shells was

available from only nonsubject sources.

 1

 California Carbon ***.

 2

 Acticarb stopped producing in October 2005 and is not currently in operation. Petition, p. 3, n. 6. ***.

 3

 Cal Pacific ***.

 4 Petition, Exhibit General-1.

 5

 Petition, p. 3.

 6

 On March 15, 2006, Respondent CIAC filed an industry support challenge with Commerce stating among other

things that “in addition to being importers of subject merchandise, the following companies are also U.S. producers

of subject merchandise: Carbon Link Corporation (Carbon Link), NUCON, PICA USA, Inc. (PICA), and Superior

Adsorbents, Inc. (SAI).” CAIC March 15, 2006 submission to Commerce, p. 2, n. 2. Commerce received additional

submissions from CIAC on March 21, 22, and 24. Petitioners responded to those submissions on March 22 and 28.

In its March 21, 2006, submission to Commerce, CIAC provided the following information with regard to

respondents “production” operations:

Carbon Link–“Carbon Link produces a variety of activated carbon products in its facilities in

Mount Vernon, Ohio. Carbon Link *** for uses primarily in the filtration field. In 2005, Carbon

Link produced *** of activated carbon products.”

PICA–“PICA USA produces a variety of activated carbon products in its facilities in Columbus,

Ohio. PICA USA ***. In 2005, PICA USA produced *** of activated carbon products.”

SAI–“SAI’s production operations primarily involve ***. Additionally, SAI produces ***. SAI

(continued...)

III-1

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 alleged 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, as it relates to certain activated carbon, chemically activated carbon, and

total activated carbon, 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 four firms that accounted for virtually all of U.S.

production (three firms for certain activated, two for chemically activated, and four for total activated)

during 2003-05.

U.S. PRODUCERS

The petition identified five firms that produced certain activated carbon during 2003-05. In

addition to Calgon and Norit, California Carbon,1

 Acticarb Tailored Products, LLC (Acticarb),2 and Cal

Pacific Carbon (Cal Pacific)3

 were listed as producers of the subject product. Petitioners estimated the

2005 production of the latter three firms to be nearly *** pounds compared with the combined Calgon

and Norit production of more than *** pounds.4

 Petitioners noted that they determined the “universe” of

domestic producers in the following manner.

“Principally as domestic producers of certain activated carbon, petitioners are aware of

the other producers in the market by virtue of directly competing with them in bids. 

Many companies that hold themselves out as domestic producers of certain activated

carbon are actually engaging in reactivation of used activated carbon or other postproduction processing of activated carbon that is imported or produced by other domestic

producers.”5 6
 6

 (...continued)

products are used in ***. In 2005, SAI produced *** of activated carbon products.”

NUCON–“NUCON operates production facilities in Columbus, Ohio. NUCON ***. NUCON

produces ***. Additionally, NUCON produces ***. In 2005, NUCON produced *** of activated

carbon products.”

CAIC March 21, 2006 submission to Commerce, p. 2.

In its March 22, 2006, submission to Commerce, CIAC provided the following information to further

clarify its position with regard to respondents’ “production” operations:

“Additionally, we would like to restate for the record what we stated in our conversation with

Department staff on Friday, March 17, 2005 {sic}, that ***.”

CAIC March 22, 2006 submission to Commerce, p. 2. 

Finally, in response to a question from Commission staff as to whether the five firms named in the petition

are the only firms that actually activate carbon, counsel for CIAC stated:

“To our knowledge, that's correct. Some of our clients also do what's being characterized as

further processing, but they don't include the activation step. There are others that are not

represented in the proceeding that also do some further processing that does not involve activation.

See, testimony of Joseph H. Heckendorn, Bryan Cave, conference transcript, p. 158.

 7

 ***. Calgon questionnaire. 

 8

 Calgon’s Pearlington facility was closed from August 27, 2005, through November 7, 2005, due to damage

caused by Hurricanes Katrina and Rita. In its postconference submission, CIAC argued that petitioner’s (Calgon)

claim that they are being materially injured by Chinese imports is “flatly unfounded,” noting that Calgon’s CEO,

John Stanik’s statements in conference calls held on October 26, 2005, and March 29, 2006, concerning the

company’s earnings in the third and fourth quarters of 2005, addressed the impact of Hurricanes Katrina and Rita on

Calgon’s financial performance with mentioning subject imports. In part, Mr. Stanik stated:

“Hurricanes Katrina and Rita both impacted the company’s sales and costs. Regarding sales, the

effects of the hurricanes were two-fold: Hurricane Katrina’s path was directly over our Pearl

River facility resulting in the plant being partially submerged under water. The consequence of

this was to shutdown the facility, which remains down today (October 26, 2005). This downtime

hindered our ability to meet some customer requests. The second effect was the effect that both

hurricanes had on customer carbon and service consumption. Many of our Gulf Coast industrial

and municipal customers experienced and continue to experience downtime in their operations.”

CIAC postconference brief, p. 43. 

 9

 See, testimony of Robert O’Brien, Calgon, conference transcript, p. 15. Calgon Carbon (Tianjin) Co., Ltd., a

Chinese producer/exporter of subject product, is a subsidiary of Calgon.

 10 http://www.calgoncarbon.com/company/index.html, retrieved March 31, 2006. Calgon Carbon is selfdescribed as the world’s largest manufacturer of granular activated carbon with production and operations in North

America, Europe, and Asia. Ibid.

III-2

Calgon is headquartered in Pittsburgh, PA, with production facilities located in Catlettsburg, KY7

and Pearlington, MS.8 It is the largest producer of certain activated carbon in the United States and also

has operations around the world, including China.9

 According to its website, Calgon, along with its

European operation Chemviron Carbon, is a “global manufacturer and supplier of granular activated

carbon, innovative treatment systems, value added technologies and services for optimizing production

processes and safely purifying the environment.”10 During the staff conference in this investigation,

counsel for CIAC stated that it was “appropriate to at least probe the issue of exclusion of Calgon as a
 11 See, testimony of Lyle Vander Schaaf, conference transcript, p. 174.

 12 Table III-1. Calgon also ***.

 13 ***. Calgon questionnaire.

 14 See, testimony of Ronald Thompson, Norit, conference transcript, pp. 26-27. Norit also has separate

reactivation facilities in the United States. Ibid. Norit closed its chemically activated carbon production facilities in

Marshall, TX, in January 2005. Those facilities were separate from the certain activated carbon production facilities.

 15 Ibid, p. 27.

 16 http://www.noit-ac.com/, retrieved April 3, 2006.

 17 Table III-1. During 2003-05, Norit’s imports of subject product were equivalent of *** percent, respectively,

of its U.S. production of total activated carbon. Norit ***.

 18 California Carbon ***. California Carbon also ***. During 2003-05, its ***, respectively. Additionally,

California Carbon is ***. Ibid. 

 19 MeadWestvaco ***. 

III-3

related party” in view of its imports from and operations in China;11 however, CIAC provided no further

discussion of this potential issue in its postconference submission. During 2003-05, Calgon’s imports of

certain activated carbon from China were the equivalent of *** percent, respectively, of its U.S.

production.12 13

Norit is headquartered in Marshall, TX, with certain activated production facilities located there

as well as Pryor, OK.14 Norit’s parent company, Norit NV, is located in the Netherlands and has

production facilities there.15 According to its website, Norit is:

“. . .the world's largest producer of activated carbon and related services. With over 80

years of experience, NORIT has grown to produce well over 150 different types of

activated carbon products, enabling them to offer the most choices, precise fit and best

performance for any application. NORIT also offers activated carbon reactivation, carbon

change out services, and both granular and powdered carbon systems & equipment.”16

Norit is also an importer of subject product from China. During 2003-05, Norit’s imports from China

were the equivalent of *** percent, respectively, of its U.S. production of certain activated carbon.17

California Carbon is located in Wilmington, CA, where it operates a small production facility for

certain activated carbon as well as a facility for reactivating carbon. According to its ***, *** percent of

its operations were used for ***. In 2005, California Carbon’s production of certain activated carbon

amounted to *** pounds, or *** percent of total U.S. production.18 

As noted earlier, MeadWestvaco and Norit produced chemically activated carbon during the

period examined, although Norit closed its production facility in 2005. MeadWestvaco, headquartered in

Stamford, CT, is a diversified manufacturing company active in the packaging, consumer and office

products, specialty chemicals, and specialty papers businesses.19 It specialty chemicals division is
 20 Table VI-5 presents sales and financial data for producers of chemically activated carbon, by firm, for 2003-05. 

III-4

headquartered in Charleston, SC, and it produces chemically activated carbon at its facilities in

Covington, VA, and Wickliffe, KY. MeadWestvaco ***. During 2003-05, ***.20

U.S. PRODUCERS’ CAPACITY, PRODUCTION, CAPACITY UTILIZATION, 

SHIPMENT, INVENTORY, AND EMPLOYMENT DATA

Tables III-1, III-2, and III-3 present U.S. producers’ capacity, production, capacity utilization,

shipment, inventory, and employment data, for certain activated carbon, chemically activated carbon, and

total activated carbon, respectively.

Table III-1

Certain activated carbon: U.S. capacity, production, capacity utilization, shipments, end-of-period

inventories, and employment-related indicators, 2003-05

* * * * * * *

Table III-2

Chemically activated carbon: U.S. capacity, production, capacity utilization, shipments, end-ofperiod inventories, and employment-related indicators, 2003-05

* * * * * * *

Table III-3

Total activated carbon: U.S. capacity, production, capacity utilization, shipments, end-of-period

inventories, and employment-related indicators, 2003-05

* * * * * * *
 1

 The Commission sent questionnaires to those firms identified in the petition and firms identified by the U.S. 

Customs and Border Protection (“Customs”) as possible importers.

 2

 ***.

 3

 Imports of activated carbon are from official statistics under HTS subheading 3802.10.00.

 4

 In 2005, the Philippines and Sri Lanka accounted for 14.3 and 11.9 percent of certain activated carbon imports,

respectively. 

IV-1

PART IV: U.S. IMPORTS, APPARENT CONSUMPTION, 

AND MARKET SHARES

U.S. IMPORTERS

The Commission sent importer questionnaires to 61 firms believed to be importers of certain

activated carbon, as well as to all U.S. producers.1

 Usable questionnaire responses were received from

31 companies that in 2005 accounted for 96.3 percent of total activated carbon imports (based on official

statistics) from China. Thirty-one companies reported imports of certain activated carbon from China

during 2003-05, while seven reported imports from other sources. The five largest responding importers

of certain activated carbon from China were ***, collectively accounting for 58.1 percent of reported

imports of activated carbon from China in 2005. Imports of chemically activated carbon from China were

reported by five companies,2

 with nine firms reporting imports from other sources. *** reported imports

of chemically- activated carbon exclusively from China. *** imported chemically activated carbon from

both China and other sources. A list of U.S. importers of activated carbon, the countries they import

from, and their shares of reported 2005 imports from China are presented in table IV-1. 

U.S. IMPORTS

U.S. imports of certain activated carbon, chemically activated carbon and total activated carbon 

are presented in tables IV-2, IV-3, and IV-4, respectively.3

 In 2005, China was the largest exporter of

subject activated carbon to the United States, accounting for 60.1 percent of total imports of certain

activated carbon, with the Philippines and Sri Lanka being the second and third largest exporters,

respectively.4
IV-2

Table IV-1

Activated carbon: U.S. importers, countries they import from, and shares (in percent) of 2005

imports

* * * * * * *

Table IV-2

Certain activated carbon: U.S. imports, by sources, 2003-05

* * * * * * *

Table IV-3

Chemically activated carbon: U.S. imports, by sources, 2003-05

* * * * * * *
IV-3

Table IV-4

Total activated carbon: U.S. imports, by sources, 2003-05

Source

Calendar year

2003 2004 2005

Quantity (1,000 pounds)

China-- 

Certain activated 67,719 82,942 82,940

Chemically activated 924 1,170 1,078

Total 68,644 84,111 84,018

Other sources 56,726 58,210 74,659

Total 125,370 142,322 158,677

Value (1,000 dollars)

1

China--

Certain activated 21,712 27,271 28,660

Chemically activated 581 715 648

Total 22,293 27,986 29,308

Other sources 46,136 47,930 59,868

Total 68,430 75,916 89,176

Unit value (per pound)

1

China--

Certain activated $0.32 $0.33 $0.35

Chemically activated $0.63 $0.61 $0.60

Average $0.32 $0.33 $0.35

Other sources 0.81 0.82 0.80

Average 0.55 0.53 0.56

Share of quantity (percent)

China--

Certain activated 54.0 58.3 52.3

Chemically activated 0.7 0.8 0.7

Total 54.8 59.1 52.9

Other sources 45.2 40.9 47.1

Total 100.0 100.0 100.0

Share of value (percent)

China--

Certain activated 31.7 35.9 32.1

Chemically activated 0.8 0.9 0.7

Total 32.6 36.9 32.9

Other sources 67.4 63.1 67.1

Total 100.0 100.0 100.0

 1 Landed, duty-paid.

Note.–Because of rounding, figures may not add to the totals shown.

Source: Compiled from official Commerce statistics.
IV-4

Changes in importers’ operations since January 1, 2003 were reported by six firms and are

presented in table IV-5. 

Table IV-5

Activated carbon: U.S. importers and changes in operations since January 1, 2003

* * * * * * *

NEGLIGIBILITY

The Tariff Act provides for the termination of an investigation if imports of the subject product

from a country are less than 3 percent of total imports, or, if there is more than one such country, their

combined share is less than or equal to 7 percent of total imports, during the most recent 12 months for

which data are available preceding the filing of the petition–in this case March 2005 to February 2006. 

The share (in percent) of the total quantity of U.S. imports, by sources, is presented in table IV-6.

Table IV-6

Activated carbon: U.S. imports, by sources, and share of total imports (in percent), March 2005-February 2006

Country

Certain activated carbon Chemically activated

carbon Total activated carbon

Imports 

(1,000

pounds)

Share of

total

imports

(percent)

Imports 

(1,000

pounds)

Share of

total

imports

(percent)

Imports 

(1,000

pounds)

Share of

total

imports

(percent)

China 79,951 56.1 1,039 4.7 80,990 48.8

Other sources 62,666 43.9 22,263 95.7 84,929 51.2

 Total 142,617 100.0 23,326 100.0 165,919 100.0

Note.–Because of rounding, figures may not add to the totals shown.

Source: Compiled from official Commerce Statistics.
 5

 The quantity of U.S. consumption of chemically activated carbon and total activated carbon increased by 4.8

percent and 10.9 percent, respectively, from 2003 to 2005.

 6

 The value of U.S. consumption of chemically activated carbon and total activated carbon increased by 10.5

percent and 11.0 percent, respectively, from 2003 to 2005.

IV-5

APPARENT U.S. CONSUMPTION

Data on U.S. consumption of certain activated carbon, chemically activated carbon and total

activated carbon are presented in tables IV-7, IV-8, and IV-9, respectively. The quantity of U.S.

consumption of certain activated carbon increased by 12.8 percent from 2003 to 2005.5

 The value of U.S.

consumption of certain activated carbon increased by 11.4 percent from 2003 to 2005.6

Table IV-7

Certain activated carbon: U.S. producers’ U.S. shipments, U.S. imports, by sources, and total U.S.

consumption, 2003-05

* * * * * * *

Table IV-8

Chemically activated carbon: U.S. producers’ U.S. shipments, U.S. imports, by sources, and total

U.S. consumption, 2003-05

* * * * * * *

Table IV-9

Total activated carbon: U.S. producers’ U.S. shipments, U.S. imports, by sources, and total U.S.

consumption, 2003-05

* * * * * * *
IV-6

U.S. MARKET SHARES

Market shares for certain activated carbon, chemically activated carbon, and total activated

carbon are presented in tables IV-10, IV-11, and IV-12, respectively. Both the quantity and value of the

U.S. producers’ market share of certain activated carbon decreased steadily from 2003 through 2005.

 

Table IV-10

Certain activated carbon: U.S. consumption and market shares, 2003-05

Item

Calendar year

2003 2004 2005

Quantity (1,000 pounds)

U.S. consumption *** *** ***

Value (1,000 dollars)

U.S. consumption *** *** ***

Share of quantity (percent)

U.S. producers’ U.S. shipments 58.6 53.1 51.7

U.S. imports from--

China 26.8 30.2 29.1

Nonsubject countries 14.6 16.7 19.3

Total imports 41.4 46.9 48.3

Share of value (percent)

U.S. producers’ U.S. shipments 64.4 59.2 57.8

U.S. imports from--

China 14.1 16.9 16.8

Nonsubject countries 21.4 23.9 25.5

Total imports 35.6 40.8 42.2

Note.–Because of rounding, figures may not add to the totals shown.

Source: Compiled from data submitted in response to Commission questionnaires and from official Commerce statistics, using

proportions gathered from questionnaire data.

Table IV-11

Chemically activated carbon: U.S. consumption and market shares, 2003-05

* * * * * * *

Table IV-12

Total activated carbon: U.S. consumption and market shares, 2003-05

* * * * * * *
IV-7

RATIO OF SUBJECT IMPORTS TO U.S. PRODUCTION

Information concerning the ratio of subject imports to U.S. production of certain activated

carbon, chemically activated carbon, and total activated carbon is presented in tables IV-13, IV-14, and 

IV-15, respectively.

Table IV-13

Certain activated carbon: Ratio of U.S. imports to U.S. production, by sources, 2003-05

* * * * * * *

Table IV-14

Chemically activated carbon: Ratio of U.S. imports to U.S. production, by sources, 2003-05

* * * * * * *

Table IV-15

Total activated carbon: Ratio of U.S. imports to U.S. production, by sources, 2003-05

* * * * * * *

 1

 Petition, p. 13.

 2

 Petition, pp. 51-61.

V-1

PART V: PRICING AND RELATED INFORMATION

FACTORS AFFECTING PRICES

Raw Materials

The production of certain activated carbon begins with some material that contains a high level of

carbon. Such materials include, but are not limited to, coal (both bituminous and lignite), wood, coconut

shells, olive stones, and peat. According to petitioners, coal is the raw material most widely used by both

U.S. and Chinese producers of certain activated carbon.1

 As shown in figure V-1, the price of coal has

risen over the period for which data were collected. Prices in the fourth quarter of 2005 were 50 percent

higher than they were in the first quarter of 2003. Other raw materials used in the production process

include pitch, phosphoric acid, oxygen, steam, and water.2

 Overall, raw materials accounted for ***

percent of the cost of goods sold in 2005, *** percent in 2003 and. Electricity and natural gas are also

used in the production process and accounted for *** percent of the total cost of good sold in 2005, ***

percent in 2003.

Figure V-1

Coal prices: Average domestic price of coal to industrial plants, 2003-05

Sour

ce: Quarterly Coal Reports (various issues, 2003-2005) Table 25 - Average Price of Coal Receipts at Other

Industrial Plants. Energy Information Administration, Office of Coal, Nuclear, Electric, and Alternate Fuels, U.S.

Department of Energy. Available at http://tonto.eia.doe.gov/FTPROOT/coal/qcrhistory.htm.

Transportation Costs to the U.S. Market

Transportation costs for certain activated carbon from China to the United States (excluding U.S.

inland costs) in 2005 are estimated to be equivalent to approximately 24.4 percent of the customs value
 3

 These estimates are based on HTS subheading 3802.10.00.

 4

 Source: IMF International Financial Statistics. Downloaded from http://imfstatistics.org/imf/ifsBrowser.aspx

April 6, 2006.

V-2

for product from China. 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.3

U.S. Inland Transportation Costs

Reported U.S. inland transportation costs for certain activated carbon were approximately ***

percent for one responding major U.S. producer and *** percent for the other. The ***. Reported U.S.

inland transportation costs ranged from 0 to 30 percent for the 30 reporting Chinese importers with all but

two reporting transportation costs of 20 percent or less.

Producers and importers also were asked to estimate the percentage of their sales that occurred

within certain distance ranges. One of the two major U.S. producers reported shipping *** percent of its

sales under 100 miles and the other reported that *** percent of its sales were shipped less than 100 miles. 

The third reporting U.S. producer reported that *** percent of its sales were shipped under 100 miles. 

One major U.S. producer reported shipping *** percent of sales between 100 and 1,000 miles and the

other reported that *** percent of its sales were shipped between 100 and 1,000 miles. The third

responding U.S. producer reported that *** percent of its sales were shipped between 100 and 1,000

miles. Finally, while one major U.S. producer reported shipping *** percent of its sales more than 1,000

miles, the other major U.S. producer reported that *** percent of its sales were shipped more than 1,000

miles, and the third responding producer reported that *** percent of its sales were shipped over 1,000

miles. Seven of 31 responding importers reported shipping at least 50 percent of their sales more than

1,000 miles; 16 reported shipping at least 50 percent of their sales between 100 and 1,000 miles; and 7

reported shipping at least 50 percent of their sales less than 100 miles with 3 of those shipping 100

percent of their sales less than 100 miles. 

Exchange Rates

From 2000 to June of 2005, the Chinese currency was pegged at 8.28 yuan per U.S. dollar. 

There was a small revaluation in the third quarter of 2005 raising the value of the Chinese currency to

8.14 yuan per dollar after which the yuan was moved to a partial float against the dollar. The yuan

appreciated further in the fourth quarter of 2005, averaging 8.08 yuan per dollar.4

PRICING PRACTICES

Pricing Methods

Certain activated carbon is sold on both a spot and a contract basis. *** reported that ***. Shortterm contracts last *** while long-term contracts ***. The third responding U.S. producer reported that

***. Six of 29 responding importers reported that 100 percent of their sales were on a spot basis with

eight more reporting that at least 50 percent of their sales were on a spot basis. Seventeen of the 29

responding importers reported that at least half of their sales were made on a contract basis. Eight

importers reported that at least 50 percent of their sales were on a long-term contract basis while six

reported that more than 50 percent of their sales were on a short-term contract basis.

While ***. *** reported that they ***. ***. ***. While a majority (22 of 31) of responding

importers reported determining price on at least some of their sales on a transaction-by-transaction basis,

seven reported using a price list for some (usually the smaller) or all of their customers. Sixteen
V-3

responding importers reported giving discounts based on, among other things, quantity, long-term orders,

and early payment. Ten importers reported that they have no discount policy.

PRICE DATA

The Commission requested U.S. producers and importers of certain activated carbon to provide

quarterly data for the total quantity and f.o.b. (U.S. point of shipment) value of certain activated carbon

that was shipped to unrelated customers in the U.S. market. Data were requested for the period January

2003 to December 2005. The products for which pricing data were requested are defined as follows: 

Product 1.–Granular activated carbon that is steam activated from coal (bituminous or lignite),

unwashed, no more than 15 percent greater than 8 mesh and no more than 4 percent under 30

mesh, iodine no. 900 mg/g min, moisture 2% max

Product 2.– Granular activated carbon that is steam activated from coal (bituminous or lignite),

unwashed, no more than 5 percent greater than 12 mesh and no more than 4 percent under 40

mesh, iodine no. 1000 mg/g min, moisture 2% max

Product 3.–Powder activated carbon that is steam activated from coal (bituminous or lignite),

unwashed, particle size 90% min, 325 mesh, iodine no. 700 mg/g min, moisture 5% max

Three U.S. producers and 21 importers of certain activated carbon from China provided usable

pricing data for sales of the requested products, although not all firms reported pricing for all quarters. 

Tables V-1 through V-3 and figures V-2 through V-4 present f.o.b. (U.S. point of shipment) selling prices

for the three activated carbon products defined above produced and sold in the United States as well as

products produced in China and imported into the United States. By quantity, pricing data reported by

responding firms in 2003 through 2005 accounted for 49.8 percent of U.S. commercial shipments of U.S.-

produced certain activated carbon and 35.7 percent of U.S. commercial shipments of Chinese-produced

certain activated carbon.
V-4

Table V-1

Certain activated carbon: Weighted-average f.o.b. prices and quantities of domestic and imported

product 1 and margins of underselling/(overselling), by quarters, January 2003-December 2005

Period

United States China

Price

(per pound)

Quantity

(pounds)

Price

(per pound)

Quantity

(pounds)

Margin

(percent)

2003:

 Jan.-Mar. $*** *** $0.37 2,964,407 ***

 Apr.-June *** *** 0.40 3,852,530 ***

 July-Sept. *** *** 0.41 2,057,807 ***

 Oct.-Dec. *** *** 0.42 1,816,395 ***

2004:

 Jan.-Mar. *** *** 0.36 3,453,197 ***

 Apr.-June *** *** 0.38 4,730,417 ***

 July-Sept. *** *** 0.44 3,537,833 ***

 Oct.-Dec. *** *** 0.46 2,519,064 ***

2005:

 Jan.-Mar. *** *** 0.38 2,736,088 ***

 Apr.-June *** *** 0.42 3,631,809 ***

 July-Sept. *** *** 0.52 1,906,971 ***

 Oct.-Dec. *** *** 0.46 1,476,488 ***

Source: Compiled from data submitted in response to Commission questionnaires.
V-5

Table V-2

Certain activated carbon: Weighted-average f.o.b. prices and quantities of domestic and imported

product 2 and margins of underselling/(overselling), by quarters, January 2003-December 2005

Period

United States China

Price

(per pound)

Quantity

(pounds)

Price

(per pound)

Quantity

(pounds)

Margin

(percent)

2003:

 Jan.-Mar. $*** *** $0.45 1,725,502 ***

 Apr.-June *** *** 0.42 1,803,736 ***

 July-Sept. *** *** 0.43 1,066,081 ***

 Oct.-Dec. *** *** 0.44 1,275,186 ***

2004:

 Jan.-Mar. *** *** 0.44 1,640,068 ***

 Apr.-June *** *** 0.44 1,954,385 ***

 July-Sept. *** *** 0.54 1,603,410 ***

 Oct.-Dec. *** *** 0.50 1,500,458 ***

2005:

 Jan.-Mar. *** *** 0.46 2,217,212 ***

 Apr.-June *** *** 0.51 1,898,630 ***

 July-Sept. *** *** 0.43 1,555,818 ***

 Oct.-Dec. *** *** 0.43 1,284,326 ***

Source: Compiled from data submitted in response to Commission questionnaires.
V-6

Table V-3

Certain activated carbon: Weighted-average f.o.b. prices and quantities of domestic and imported

product 3 and margins of underselling/(overselling), by quarters, January 2003-December 2005

Period

United States China

Price

(per pound)

Quantity

(pounds)

Price

(per pound)

Quantity

(pounds)

Margin

(percent)

2003:

 Jan.-Mar. $*** *** $0.31 488,728 ***

 Apr.-June *** *** 0.28 1,251,826 ***

 July-Sept. *** *** 0.25 2,366,105 ***

 Oct.-Dec. *** *** 0.33 747,460 ***

2004:

 Jan.-Mar. *** *** 0.26 873,934 ***

 Apr.-June *** *** 0.25 2,289,210 ***

 July-Sept. *** *** 0.26 2,011,196 ***

 Oct.-Dec. *** *** 0.29 1,257,643 ***

2005:

 Jan.-Mar. *** *** 0.27 1,555,839 ***

 Apr.-June *** *** 0.26 1,829,518 ***

 July-Sept. *** *** 0.29 3,303,809 ***

 Oct.-Dec. *** *** 0.29 2,584,640 ***

Source: Compiled from data submitted in response to Commission questionnaires.

Figure V-2

Certain activated carbon: Weighted-average prices of domestic and imported product 1, by

quarters, January 2003-December 2005

* * * * * * *

Figure V-3

Certain activated carbon: Weighted-average prices of domestic and imported product 2, by

quarters, January 2003-December 2005

* * * * * * *

Figure V-4

Certain activated carbon: Weighted-average prices of domestic and imported product 3, by

quarters, January 2003-December 2005

* * * * * * *
V-7

Price Trends

U.S. producers’ average prices for both product 1 and product 3 showed no discernable trend over

the period for which data were collected. While prices moved from quarter to quarter, overall they stayed

relatively stable, rising by 3.5 percent between January-March 2003 and October-December 2005 for

product 1 and falling by 3.1 percent for product 3. Prices for product 2 fell by 20.1 percent between

January-March 2003 and July-September 2004 before recovering during 2005. Overall, prices for

product 2 were 4.5 percent lower in October-December 2005 than in January-March 2003. ***. ***. ***.

Prices of U.S. shipments of product 1 imported from China show an upward trend throughout the

period and have notable quarter-to-quarter variations. Overall, prices were 23.8 percent higher in

October-December 2005 than in January-March 2003. Prices of U.S. shipments of product 2 imported

from China were relatively flat through the early part of the period, rose to a high in July-September of

2004 and fell erratically thereafter, standing 3.1 percent lower in October-December 2005 than in

January-March 2003. After exhibiting wide fluctuations in the early quarters of the period for which data

were collected, prices of U.S. shipments of product 3 imported from China stayed relatively flat, rising

slightly from June to December 2005. Overall, prices were 5.3 percent lower in October-December 2005

than they were in January-March 2003. 

Price Comparisons

Prices of imports from China were lower than prices of U.S.-produced products 1 and 2 in all

quarters during the period for which data were collected. Margins for product 1 ranged from a low of

23.1 percent in quarter four 2004 to a high of 42.8 percent in quarter one 2005. Aside from the first

quarter of 2005, margins in the second half of the period were lower than they were in the first half of the

period. Margins for product 2 were over 40 percent during the first five quarters of the period for which

data were collected, fell to a low of 13.4 percent in July-September 2004 and rose to over 40 percent once

again during the last half of 2005. Margins for product 3 changed erratically throughout the period and

ranged from a low of -0.6 percent in October-December 2003 to a high of 31.4 percent in July-September

2003. Margins for product 3 were under 15 percent during the last two quarters of 2005.

LOST SALES AND LOST REVENUES

The petitioner provided a list of *** alleged lost sales to Chinese competitors totaling ***

between January 2003 and December 2005. Staff attempted to contact customers associated with ***, or

approximately *** percent, of those lost sales. In addition, petitioners alleged another *** per year of

lost revenue attributable to lower prices on retained contracts caused by competition from Chinese

producers. Staff was able to confirm *** of the alleged *** in total lost sales, and *** of the alleged ***

in annual lost revenue. Customers rejected the allegation for various reasons in *** of the total lost sales. 

In the largest of the rejected allegations (accounting for *** in lost sales), the purchaser stated that while a

Chinese supplier did win the initial bid, the supplied product did not pass quality tests and was replaced

by domestically supplied certain activated carbon. Of those contacted, staff was unable to obtain

information on *** in alleged lost sales and *** in lost revenue. 

By and large, price was the reason for choosing the Chinese product. Many of the lost sales were

to municipal water treatment facilities which, in many cases, must accept the lowest-priced product

provided that it meets the required standards. A few respondents indicated that while the lowest-priced

option was of Chinese product, the product did not pass initial tests or performed poorly upon use. As a

result, these purchasers have switched or plan to switch back to domestically produced certain activated

carbon. Since most of the alleged lost sales are from accounts with open annual bids, any bid lost to a

supplier of Chinese product, regardless of who won the contract the previous year, was counted as a lost

sale. Information on alleged lost sales and lost revenue can be seen in tables V-4 and V-5.
V-8

Table V-4 

Certain activated carbon: U.S. producers’ lost revenue allegations

* * * * * * *

Table V-5

Certain activated carbon: U.S. producers’ lost sales allegations

* * * * * * *
 1

 A third firm, ***, stated that it could not provide financial data on certain activated carbon, but did provide data

for production, shipment, and pricing. Differences between the aggregated data on shipments and sales were *** in

2005.

 2

 Petitioners’ postconference brief, exh. 1, p. 19.

VI-1

PART VI: FINANCIAL EXPERIENCE OF U.S. FIRMS

BACKGROUND

Two firms, Calgon and Norit, provided production, shipment, and financial data on their

operations on certain activated carbon. Two firms, MeadWestvaco and Norit, provided production,

shipment, and financial data on their operations on chemically activated carbon. Each of them reported

on a calendar year basis, and these data accounted for the vast majority of known U.S. production of

certain and chemically activated carbon in 2005.1

OPERATIONS ON ACTIVATED CARBON

The results of U.S. firms’ operations on certain activated carbon (table VI-1) are briefly

summarized here. Total net sales quantities, values, and sales unit values (representing the combined data

of ***), decreased irregularly between 2003 and 2005. Increases in the cost of raw materials led to an

overall increase in the industry’s cost of goods sold (“COGS”), which increased irregularly between 2003

and 2005, at the same time as sales declined. The industry’s operating *** in 2005. 

The combined results of *** on chemically activated carbon (table VI-2) differ considerably from

the results described earlier for certain activated carbon, i.e., sales quantities, values, and unit values

irregularly increased between 2003 and 2005. Energy costs increased while raw material costs and other

components of COGS were flat or slightly declined during 2003-05 and the combined operating ***

between 2003 and 2005. It should be noted that ***. 

Table VI-1

Certain activated carbon: Results of operations of U.S. firms, 2003-05

* * * * * * *

Table VI-2

Chemically activated carbon: Results of operations of U.S. firms, 2003-05

* * * * * * *

Table VI-3

Total activated carbon: Aggregated results of operations of U.S. firms, 2003-05

* * * * * * *

In table VI-1, the data of *** differ in several important respects from those of ***: ***. These

differences were ascribed to several factors, including *** between the two firms.2 ***, for example,

mainly produces *** whereas *** mainly produces a ***. The raw material input for the granular

product reportedly is a harder (bituminous) coal that costs more than the soft (lignite) coal used to

produce the powdered product; ***. *** also ***. 

Sales and cost data for operations on certain activated carbon on a firm-by-firm basis are shown

in table VI-4.
 3

 For a discussion and price series of coal and natural gas, see petitioners’ postconference brief, pp. 35-36 and

exh. 5.

VI-2

Table VI-4

Certain activated carbon: Results of operations of U.S. producers, by firm, 2003-05

* * * * * * *

The data in table VI-2, the results of operations on chemically activated carbon, are those

reported by ***. *** accounts for a *** of the total in any one year. ***’s results reflect its efforts to ***

operations and it ***. Hence, the data are predominantly those of ***. *** results of operations differ

from those of ***: its sales unit values are *** and it was ***. *** cost structure for chemically

activated carbon differs from that of the firms producing certain activated carbon (compare table VI-1 and

table VI-2, for example). Its sales unit values are *** and the bulk of its costs are in energy and factory

overhead. Table VI-5 presents data on a firm-by-firm basis for operations on chemically activated

carbon.

Table VI-5

Chemically activated carbon: Results of operations of U.S. producers, by firm, 2003-05

* * * * * * *

Raw materials and energy represent a large and increasing component of total COGS of the three

firms that reported sales of certain activated carbon and chemically activated carbon. With regard to

certain activated carbon, raw material costs are chiefly composed of the costs of coal.3

 The ratio of raw

material costs to total COGS, the ratio of raw material costs to sales, and the average unit value of raw

materials *** during the three years investigated, as shown in table VI-6, which presents data for certain

activated carbon. With regard to chemically activated carbon, the primary raw material input is wood. 

Although raw material costs of this product increased, they did not increase to the same extent as did the

raw material costs of certain activated carbon. Energy costs, ***. The raw material and energy costs of

chemically activated carbon are shown in table VI-7. 

Table VI-6

Certain activated carbon: Raw material and energy costs, by firm, 2003-05

* * * * * * *

Table VI-7

Chemically activated carbon: Raw material and energy costs, by firm, 2003-05

* * * * * * *

Changes in the operating income of these firms are further evidenced by a variance analysis that

shows the effects of prices and volume on net sales and of costs and volume on their total costs. Because

the usefulness of the analysis may be diminished by the product mix and cost differences *** at the end

of table VI-8.

Table VI-8

Certain activated carbon: Variance analysis on results of operations, 2003-05
 4

 Petitioner’s postconference brief, exh. 14.

VI-3

* * * * * * *

This analysis shows that the decrease in operating income between 2003 and 2005 of $*** was

attributable to combined unfavorable variances of price ***, net cost/expense ***, and lower sales

volume. However, the mix of favorable and unfavorable variances differed considerably *** and shifted

between the full calendar years, with an unfavorable price variance between 2003 and 2004 that was

greater than the favorable net cost/expense variance; between 2004 and 2005 the unfavorable net

cost/expense variance greatly outweighed the favorable price variance.

Tables VI-9 and VI-10 present a variance analysis for chemically activated carbon and total

activated carbon, respectively.

Table VI-9

Chemically activated carbon: Variance analysis on results of operations, 2003-05

* * * * * * *

Table VI-10

Total activated carbon: Variance analysis on aggregated results of operations, 2003-05

* * * * * * *

CAPITAL EXPENDITURES AND RESEARCH AND DEVELOPMENT EXPENSES

*** reported capital expenditures, and research and development (“R&D”) expenses for certain

activated carbon while *** reported capital expenditures for chemically activated carbon (table VI-11). It

appears that the primary purpose of ***.4

 

Table VI-11

Certain activated carbon and chemically activated carbon: Capital expenditures and R&D

expenses, by firm, 2003-05

* * * * * * *

ASSETS AND RETURN ON INVESTMENT

The Commission’s questionnaire requested data on assets used in the production, warehousing,

and sale of certain activated carbon and chemically activated carbon to compute return on investment

(“ROI”) for 2003 to 2005. The data for total net sales and operating income are from tables VI-1 and VI2. Operating income was divided by total net sales, resulting in the operating income ratio. Total net

sales was divided by total assets, resulting in the asset turnover ratio. The operating income ratio was

then multiplied by the asset turnover ratio, resulting in ROI; the expanded form of this equation shows

how the profit margin and total assets turnover ratio interact to determine the return on investment. 

U.S. producers’ total assets and their ROI are presented in tables VI-12 and VI-13, certain

activated carbon and chemically activated carbon, respectively. The total assets utilized in the

production, warehousing, and sales of certain activated carbon were flat between 2003 and 2005 (the

decrease in book value of fixed assets was made up for by an increase in the residual category of other

noncurrent assets). ROI ***. 

Table VI-12
 5

 Testimony of Ronald Thompson, Norit, conference transcript, p. 27.

 6 See, testimony of Robert O’Brien, Calgon, conference transcript, p. 25.

VI-4

Certain activated carbon: Value of assets used in the production, warehousing, and sale, 

and return on investment, 2003-05

* * * * * * *

For chemically activated carbon, ROI was ***. As stated at the staff conference, Norit closed the

chemical activation facility at Marshall, TX,5

 ***. Chemically activated carbon assets and ROI are shown

in table VI-13, and total activated carbon assets and ROI are shown in table VI-14. 

Table VI-13

Chemically activated carbon: Value of assets used in the production, warehousing, and sale, and

return on investment, 2003-05

* * * * * * *

Table VI-14

Total activated carbon: Total value of assets used in the production, warehousing, and sale, and

return on investment, 2003-05

* * * * * * *

CAPITAL AND INVESTMENT

The Commission requested U.S. producers to describe any actual or anticipated negative effects

of imports of certain activated carbon from China on their firms’ growth, investment, and ability to raise

capital or development and production efforts (including efforts to develop a derivative or more advanced

version of the product). U.S. producer responses are presented below. 

Actual Negative Effects

Calgon ***.6

MeadWestvaco ***.

Norit ***. 

Anticipated Negative Effects

Calgon ***.

MeadWestvaco ***.

Norit ***. 
 1

 Of the 19 firms, 14 are producer/exporters, while five are exporters only. ***.

 2

 The two firms are ***. The exports to the United States of these two firms accounted for all of chemically

activated carbon U.S. imports from China in 2005.

VII-1

PART VII: THREAT CONSIDERATIONS

The Commission analyzes a number of factors in making threat determinations (see 19 U.S.C. §

1677(7)(F)(i)). 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.

THE INDUSTRY IN CHINA

Tables VII-1, VII-2, and VII-3 present data provided by Chinese producers/exporters through

their counsel with respect to their certain activated carbon, chemically activated carbon, and total

activated carbon operations, respectively, in China. Twenty-four firms, 19 of which exported certain

activated carbon to the United States, provided useable data.1

 The exports to the United States of these

firms were equivalent to 56.4 percent of certain activated carbon U.S. imports from China in 2005. 

Seventeen firms noted that certain activated carbon represented 100 percent of their firm’s total sales in

2005, with only two noting that it represented less than 50 percent. Two firms reported exporting

chemically activated carbon to the United States.2
VII-2

Table VII-1

Certain activated carbon: Chinese production capacity, production, shipments, and inventories, 2003-05 and

projected 2006-07

Item

Actual experience Projections

2003 2004 2005 2006 2007

Quantity (1,000 pounds)

Capacity 197,475 245,235 274,115 274,520 277,520

Production 181,279 228,943 260,851 266,147 268,356

End of period inventories 20,459 16,469 26,199 22,349 20,042

Shipments:

Internal consumption 0 4,951 6,991 7,120 6,920

Home market 72,872 151,834 179,848 184,631 191,931

Exports to--

The United States 38,619 57,991 46,813 42,826 41,825

All other markets 119,883 147,080 146,092 149,844 144,892

Total exports 158,502 205,071 192,905 192,670 186,717

Total shipments 231,374 361,856 379,744 384,421 385,568

Ratios and shares (percent)

Capacity utilization 90.8 90.7 92.0 93.7 93.5

Inventories to production 11.3 7.2 10.0 8.4 7.5

Inventories to total shipments 8.8 4.6 6.9 5.8 5.2

Share of total quantity of shipments:

Internal consumption 0.0 1.4 1.8 1.9 1.8

Home market 31.5 42.0 47.4 48.0 49.8

Exports to--

The United States 16.7 16.0 12.3 11.1 10.8

All other markets 51.8 40.6 38.5 39.0 37.6

All export markets 68.5 56.7 50.8 50.1 48.4

Note.–Because of rounding, figures may not add to the totals shown.

Source: Compiled from data submitted in response to Commission questionnaires.

Table VII-2

Chemically activated carbon: Chinese production capacity, production, shipments, and inventories, 2003-05

and projected 2006-07

* * * * * * *

Table VII-3

Total activated carbon: Chinese production capacity, production, shipments, and inventories, 2003-05 and

projected 2006-07

* * * * * * *
VII-3

U.S. IMPORTERS’ INVENTORIES

Inventories of certain activated carbon, chemically activated carbon, and total activated carbon as 

reported by U.S. importers are presented in tables VII-4, VII-5, and VII-6, respectively.

Table VII-4

Certain activated carbon: U.S. importers’ end-of-period inventories of imports, 2003-05

Item

Calendar year

2003 2004 2005

Imports from China:

Inventories (1,000 pounds) 18,091 20,730 22,976

Ratio to imports (percent) 29.3 26.7 28.8

Ratio to U.S. shipments of imports (percent) 29.2 27.6 30.1

Imports from all other sources:

Inventories (1,000 pounds) 3,735 5,894 9,562

Ratio to imports (percent) 34.8 21.5 30.3

Ratio to U.S. shipments of imports (percent) 37.1 28.6 36.2

Imports from all sources:

Inventories (1,000 pounds) 21,826 26,624 32,538

Ratio to imports (percent) 30.1 25.3 29.2

Ratio to U.S. shipments of imports (percent) 30.3 27.8 31.6

Note.--Ratios are based on firms that provided both inventory data and import and/or shipment data.

Source: Compiled from data submitted in response to Commission questionnaires. 

Table VII-5

Chemically activated carbon: U.S. importers’ end-of-period inventories of imports, 2003-05

* * * * * * *

Table VII-6

Total activated carbon: U.S. importers’ end-of-period inventories of imports, 2003-05

 * * * * * * *
 3

 Petitioners’ postconference brief, exhibit 1, p. 5, responding to a question from the Commission staff. See also,

petitioners’ postconference brief, exhibit 11.

VII-4

ANTIDUMPING DUTY ORDERS IN THIRD-COUNTRY MARKETS

An antidumping order was originally put into place covering Chinese imports of powdered

activated carbon (both certain- and chemically activated) in the European Union (EU) in June 1996, with

an antidumping rate of 66.8 percent. In June 2002, the EU set new antidumping duties of 323 Euros/ton

(@$0.18/lb) on powdered activated carbon imports from China replacing the 66.8 percent duty set in June

1996.3
A-1

APPENDIX A

FEDERAL REGISTER NOTICES

13430 Federal Register / Vol. 71, No. 50 / Wednesday, March 15, 2006 / Notices 

1For purposes of this investigation, the product 

covered is certain activated carbon defined as a 

powdered, granular or pelletized carbon product 

obtained by ‘‘activating’’ with heat and steam 

various materials containing carbon, including but 

not limited to coal (including bituminous, lignite 

and anthracite), wood, coconut shells, olive stones, 

and peat. The thermal and steam treatments remove 

organic materials and create an internal pore 

structure in the carbon material. The producer can 

also use carbon dioxide gas (CO2) in place of steam 

in this process. The vast majority of the internal 

porosity developed during the high temperature 

steam (or CO2 gas) activation process is a direct 

result of oxidation of a portion of the solid carbon 

atoms in the raw material, converting them into a 

gaseous form of carbon. This definition covers all 

forms of activated carbon that are activated by 

steam or CO2, regardless of raw material, grade, 

mixture, additives, further washing or postactivation chemical treatment (chemical or water 

washing, chemical impregnation or other 

treatment), or product form. Unless specifically 

excluded, this definition covers all physical forms 

of certain activated carbon, including powdered 

activated carbon (‘‘PAC’’), granular activated carbon 

(‘‘GAC’’), and pelletized activated carbon. 

Excluded from this definition are chemicallyactivated carbons. The carbon-based raw material 

used in the chemical activation process is treated 

with a strong chemical agent, including but not 

limited to phosphoric acid or zinc chloride sulfuric 

acid, that dehydrates molecules in the raw material, 

and results in the formation of water that is 

removed from the raw material by moderate heat 

treatment. The activated carbon created by chemical 

activation has internal porosity developed primarily 

due to the action of the chemical dehydration agent. 

Chemically activated carbons are typically used to 

activate raw materials with a lignocellulosic 

component such as cellulose, including wood, 

sawdust, paper mill waste and peat. 

To the extent that an imported activated carbon 

product is a blend of steam and chemically 

activated carbons, products containing 50 percent 

or more steam (or CO2 gas) activated carbons are 

within this definition, and those containing more 

than 50 percent chemically activated carbons are 

outside this definition. 

Also excluded from this definition are reactivated 

carbons and activated carbon cloth. Reactivated 

carbons are previously used activated carbons that 

have had adsorbed materials removed from their 

pore structure after use through the application of 

heat, steam and/or chemicals. Activated carbon 

cloth is a woven textile fabric made of or containing 

activated carbon fibers. It is used in masks and 

filters and clothing of various types where a woven 

format is required. 

Any activated carbon meeting the physical 

description of subject merchandise provided above 

that is not expressly excluded from this definition 

is included within the definition. 

Committee’s recommendation that the 

park effect disposition of the physical 

remains of 24 culturally unidentifiable 

individuals and 50 associated funerary 

objects to the 22 Indian tribes listed 

above contingent on the publication of 

a Notice of Inventory Completion in the 

Federal Register. This notice fulfills 

that requirement. 

Representatives of any Indian tribe 

that believes itself to be culturally 

affiliated with the human remains and 

associated funerary objects should 

contact Larry Wiese, superintendent, 

Mesa Verde National Park, PO Box 8, 

Mesa Verde, CO 81330, telephone (970) 

529–4600, before April 14, 2006. 

Disposition of the human remains and 

associated funerary objects to the Hopi 

Tribe of Arizona; Navajo Nation, 

Arizona, New Mexico, & Utah; Pueblo of 

Acoma, New Mexico; Pueblo of Cochiti, 

New Mexico; Pueblo of Isleta, New 

Mexico; Pueblo of Jemez, New Mexico; 

Pueblo of Laguna, New Mexico; Pueblo 

of Nambe, New Mexico; Pueblo of 

Picuris, New Mexico; Pueblo of 

Pojoaque, New Mexico; Pueblo of San 

Felipe, New Mexico; Pueblo of San 

Ildefonso, New Mexico; Pueblo of San 

Juan, New Mexico; Pueblo of Sandia, 

New Mexico; Pueblo of Santa Ana, New 

Mexico; Pueblo of Santa Clara, New 

Mexico; Pueblo of Santo Domingo, New 

Mexico; Pueblo of Taos, New Mexico; 

Pueblo of Tesuque, New Mexico; Pueblo 

of Zia, New Mexico; Ysleta Del Sur 

Pueblo of Texas; and Zuni Tribe of the 

Zuni Reservation, New Mexico, may 

proceed after that date if no additional 

claimants come forward. 

Mesa Verde National Park is 

responsible for notifying the Hopi Tribe 

of Arizona; Navajo Nation, Arizona, 

New Mexico, & Utah; Pueblo of Acoma, 

New Mexico; Pueblo of Cochiti, New 

Mexico; Pueblo of Isleta, New Mexico; 

Pueblo of Jemez, New Mexico; Pueblo of 

Laguna, New Mexico; Pueblo of Nambe, 

New Mexico; Pueblo of Picuris, New 

Mexico; Pueblo of Pojoaque, New 

Mexico; Pueblo of San Felipe, New 

Mexico; Pueblo of San Ildefonso, New 

Mexico; Pueblo of San Juan, New 

Mexico; Pueblo of Sandia, New Mexico; 

Pueblo of Santa Ana, New Mexico; 

Pueblo of Santa Clara, New Mexico; 

Pueblo of Santo Domingo, New Mexico; 

Pueblo of Taos, New Mexico; Pueblo of 

Tesuque, New Mexico; Pueblo of Zia, 

New Mexico; Southern Ute Indian Tribe 

of the Southern Ute Reservation, 

Colorado; Ute Mountain Tribe of the Ute 

Mountain Reservation, Colorado, New 

Mexico, & Utah; Ysleta Del Sur Pueblo 

of Texas; and Zuni Tribe of the Zuni 

Reservation, New Mexico that this 

notice has been published. 

Dated: March 7, 2006. 

Sherry Hutt, 

Manager, National NAGPRA Program. 

[FR Doc. E6–3704 Filed 3–14–06; 8:45 am] 

BILLING CODE 4312–50–S 

INTERNATIONAL TRADE 

COMMISSION 

[Investigation No. 731–TA–1103 

(Preliminary)] 

Certain Activated Carbon From China 

AGENCY: International Trade 

Commission. 

ACTION: Institution of antidumping 

investigation and scheduling of a 

preliminary phase investigation. 

SUMMARY: The Commission hereby gives 

notice of the institution of an 

investigation and commencement of 

preliminary phase antidumping 

investigation No. 731–TA–1103 

(Preliminary) under section 733(a) of the 

Tariff Act of 1930 (19 U.S.C. 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 of certain activated 

carbon,1 provided for in subheading 

3802.10.00 of the Harmonized Tariff 

Schedule of the United States, that are 

alleged to be sold in the United States 

at less than fair value. Unless the 

Department of Commerce extends the 

time for initiation pursuant to section 

732(c)(1)(B) of the Act (19 U.S.C. 

1673a(c)(1)(B)), the Commission must 

reach a preliminary determination in 

antidumping investigations in 45 days, 

or in this case by April 24, 2006. The 

Commission’s views are due at 

Commerce within five business days 

thereafter, or by May 1, 2006. 

For further information concerning 

the conduct of this investigation 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 B (19 CFR part 207). 

DATES: Effective Date: March 8, 2006. 

FOR FURTHER INFORMATION CONTACT: Jim 

McClure (202–205–3191), 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 

this investigation may be viewed on the 

Commission’s electronic docket (EDIS) 

at http://edis.usitc.gov. 

SUPPLEMENTARY INFORMATION: 

Background.—This investigation is 

being instituted in response to a petition 

filed on March 8, 2006, by Calgon 

Carbon Corporation, Pittsburgh, PA, and 

Norit Americas, Inc., Marshall, TX. 


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Federal Register / Vol. 71, No. 50 / Wednesday, March 15, 2006 / Notices 13431 

2Commissioner Charlotte R. Lane dissenting. 

3The revised schedule for the subject reviews 

was published on November 4, 2005 (70 FR 67193). 

Participation in the investigation and 

public service list.—Persons (other than 

petitioners) wishing to participate in the 

investigation as parties must file an 

entry of appearance with the Secretary 

to the Commission, as provided in 

sections 201.11 and 207.10 of the 

Commission’s rules, not later than seven 

days after publication of this notice in 

the Federal Register. Industrial users 

and (if the merchandise under 

investigation is sold at the retail level) 

representative consumer organizations 

have the right to appear as parties in 

Commission antidumping 

investigations. The Secretary will 

prepare a public service list containing 

the names and addresses of all persons, 

or their representatives, who are parties 

to this investigation upon the expiration 

of the period for filing entries of 

appearance. 

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 this investigation available 

to authorized applicants representing 

interested parties (as defined in 19 

U.S.C.1677(9)) who are parties to the 

investigation under the APO issued in 

the investigation, provided that the 

application is made not later than seven 

days after the publication of this notice 

in the Federal Register. A separate 

service list will be maintained by the 

Secretary for those parties authorized to 

receive BPI under the APO. 

Conference.—The Commission’s 

Director of Operations has scheduled a 

conference in connection with this 

investigation for 9:30 a.m. on March 30, 

2006, at the U.S. International Trade 

Commission Building, 500 E Street, 

SW., Washington, DC. Parties wishing to 

participate in the conference should 

contact Jim McClure (202–205–3191) 

not later than March 27, 2006, to arrange 

for their appearance. Parties in support 

of the imposition of antidumping duties 

in this investigation and parties in 

opposition to the imposition of such 

duties will each be collectively 

allocated one hour within which to 

make an oral presentation at the 

conference. A nonparty who has 

testimony that may aid the 

Commission’s deliberations may request 

permission to present a short statement 

at the conference. 

Written submissions.—As provided in 

sections 201.8 and 207.15 of the 

Commission’s rules, any person may 

submit to the Commission on or before 

April 4, 2006, a written brief containing 

information and arguments pertinent to 

the subject matter of the investigation. 

Parties may file written testimony in 

connection with their presentation at 

the conference no later than three days 

before the conference. If briefs or 

written testimony contain BPI, they 

must conform with the requirements of 

§§ 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 § 201.8 of the 

Commission’s rules, as amended, 67 FR 

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). 

In accordance with §§ 201.16(c) and 

207.3 of the rules, each document filed 

by a party to the investigation must be 

served on all other parties to the 

investigation (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: This investigation is being 

conducted under authority of title VII of the 

Tariff Act of 1930; this notice is published 

pursuant to § 207.12 of the Commission’s 

rules. 

By order of the Commission. 

Issued: March 10, 2006. 

Marilyn R. Abbott, 

Secretary to the Commission. 

[FR Doc. E6–3756 Filed 3–14–06; 8:45 am] 

BILLING CODE 7020–02–P 

INTERNATIONAL TRADE 

COMMISSION 

[Investigation Nos. 701–TA–401 and 731–

TA–853–854 (Review)] 

Structural Steel Beams From Japan 

and Korea 

Determinations 

On the basis of the record 1 developed 

in the subject five-year reviews, the 

United States International Trade 

Commission (Commission) determines, 

pursuant to section 751(c) of the Tariff 

Act of 1930 (19 U.S.C. 1675(c)) (the 

Act), that revocation of the antidumping 

order on structural steel beams from 

Japan and revocation of the 

antidumping and countervailing duty 

orders on structural steel beams from 

Korea would not be likely to lead to 

continuation or recurrence of material 

injury to an industry in the United 

States within a reasonably foreseeable 

time.2

Background 

The Commission instituted these 

reviews on May 2, 2005 (70 FR 22696) 

and determined on August 5, 2005 that 

it would conduct full reviews (70 FR 

48440, August 17, 2005). Notice of the 

scheduling of the Commission’s reviews 

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 on September 19, 2005 

(70 FR 54962).3 The hearing was held in 

Washington, DC, on January 12, 2006, 

and all persons who requested the 

opportunity were permitted to appear in 

person or by counsel. 

The Commission transmitted its 

determinations in this investigation to 

the Secretary of Commerce on March 9, 

2006. The views of the Commission are 

contained in USITC Publication 3840 

(March 2006), entitled Structural Steel 

Beams from Japan and Korea: 

Investigation Nos. 701–TA–401 and 

731–TA–853–854 (Review). 

By order of the Commission. 

Issued: March 9, 2006. 

Marilyn R. Abbott, 

Secretary to the Commission. 

[FR Doc. E6–3718 Filed 3–14–06; 8:45 am] 

BILLING CODE 7020–02–P 

DEPARTMENT OF JUSTICE 

Notice of Lodging of Consent Decree 

Under the Comprehensive 

Environmental Response, 

Compensation, and Liability Act 

Under 28 CFR 50.7, notice is hereby 

given that on February 24, 2006, a 

proposed Consent Decree in United 

States v. Coffee County, et al., Civil 

Action Number 4:05–CV–5, was lodged 

with the United States District Court for 

the Eastern District of Tennessee. 

In this action the United States 

sought, under Section 107 of the 

Comprehensive Environmental 

Response, Compensation, and Liability 

Act, 42 U.S.C. 9607, recovery of 

response costs incurred by the Air Force 

in response to releases of hazardous 

substances at the Coffee County Landfill 

located on the Arnold Air Force Base in 

Tennessee. The City of Manchester, City 


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Federal Register / Vol. 71, No. 64 / Tuesday, April 4, 2006 / Notices 16757 

84C, on behalf of the Port of Houston 

Authority, grantee of FTZ 84, requesting 

export–only temporary/interim 

manufacturing (T/IM) authority within 

Subzone 84C, at Du Pont’s facilities 

located in La Porte, Texas. The 

application was filed on March 24, 

2006. 

The Du Pont facility (675 full and 

part–time employees; annual 

production capacity of 3500 to 4400 

metric tons of the products which are 

the subject of the application) is located 

at 12501 Strang Road, La Porte, Texas. 

Under T/IM procedures, the company 

has requested authority to manufacture 

two crop–protection related products 

(methomyl insectide technical and 

lannate; these products have U.S. duty 

rates of 6.5%). The company would 

source the following input item from 

abroad for manufacturing the finished 

products under T/IM authority, as 

delineated in Du Pont’s application: 

acetalhydeoxide (AAO) U.S. duty rate is 

6.5%. T/IM authority could be granted 

for a period of up to two years. 

FTZ procedures would allow Du Pont 

to avoid payment of U.S. duties on the 

input listed above because all of the 

production for which FTZ T/IM 

authority is sought will be for re–export. 

Du Pont may also realize a small 

amount of logistical/paperwork savings 

under FTZ procedures. 

Public comment is invited from 

interested parties. Submissions shall be 

addressed to the Board’s Executive 

Secretary at one of the following 

addresses: 

1. Submissions via Express/Package 

Delivery Services: Foreign–Trade Zones 

Board, U.S. Department of Commerce, 

Franklin Court Building - Suite 4100W, 

1099 14th St. NW, Washington, D.C. 

20005; or 

2. Submissions via the U.S. Postal 

Service: Foreign–Trade Zones Board, 

U.S. Department of Commerce, FCB - 

Suite 4100W, 1401 Constitution Ave. 

NW, Washington, D.C. 20230. 

The closing period for their receipt is 

May 4, 2006. 

A copy of the application will be 

available for public inspection at the 

Office of the Foreign-Trade Zones 

Board’s Executive Secretary at the first 

address listed above. 

Dated: March 28, 2006. 

Dennis Puccinelli, 

Executive Secretary. 

[FR Doc. E6–4865 Filed 4–3–06; 8:45 am] 

Billing Code: 3510–DS–S 

DEPARTMENT OF COMMERCE 

International Trade Administration 

[A–570–904] 

Initiation of Antidumping Duty 

Investigation: Certain Activated 

Carbon From the People’s Republic of 

China 

AGENCY: Import Administration, 

International Trade Administration, 

Department of Commerce. 

EFFECTIVE DATE: April 4, 2006. 

FOR FURTHER INFORMATION CONTACT: 

Catherine Bertrand or Carrie Blozy, AD/ 

CVD Operations, Office 9, Import 

Administration, International Trade 

Administration, U.S. Department of 

Commerce, 14th Street and Constitution 

Avenue, NW, Washington, DC 20230; 

telephone: (202) 482–3207 or (202) 482–

5403, respectively. 

SUPPLEMENTARY INFORMATION: 

INITIATION OF INVESTIGATION 

The Petition 

On March 8, 2006, the Department of 

Commerce (‘‘Department’’) received a 

petition on imports of certain activated 

carbon from the People’s Republic of 

China (‘‘PRC’’) filed in proper form by 

Calgon Carbon Corporation and Norit 

Americas Inc. (‘‘Petitioners’’). The 

period of investigation (‘‘POI’’) is July 1, 

2005, through December 31, 2005. 

In accordance with section 732(b) of 

the Tariff Act of 1930, as amended (‘‘the 

Act’’), Petitioners alleged that imports of 

certain activated carbon from the PRC 

are being, or are likely to be, sold in the 

United States at less than fair value 

within the meaning of section 731 of the 

Act, and that such imports are 

materially injuring and threaten to 

injure an industry in the United States. 

The Department issued supplemental 

questions to Petitioners on March 10, 

2006, and Petitioners filed their 

response on March 15, 2006. 

Scope of Investigation 

The merchandise subject to this 

investigation is certain activated carbon. 

Certain activated carbon is a powdered, 

granular or pelletized carbon product 

obtained by ‘‘activating’’ with heat and 

steam various materials containing 

carbon, including but not limited to coal 

(including bituminous, lignite and 

anthracite), wood, coconut shells, olive 

stones, and peat. The thermal and steam 

treatments remove organic materials and 

create an internal pore structure in the 

carbon material. The producer can also 

use carbon dioxide gas (CO2) in place of 

steam in this process. The vast majority 

of the internal porosity developed 

during the high temperature steam (or 

CO2 gas) activated process is a direct 

result of oxidation of a portion of the 

solid carbon atoms in the raw material, 

converting them into a gaseous form of 

carbon. 

The scope of this investigation covers 

all forms of activated carbon that are 

activated by steam or CO2, regardless of 

the raw material, grade, mixture, 

additives, further washing or post–

activation chemical treatment (chemical 

or water washing, chemical 

impregnation or other treatment), or 

product form. Unless specifically 

excluded, the scope of this investigation 

covers all physical forms of certain 

activated carbon, including powdered 

activated carbon (‘‘PAC’’), granular 

activated carbon (‘‘GAC’’), and 

pelletized activated carbon. 

Excluded from the scope of the 

investigation are chemically–activated 

carbons. The carbon–based raw material 

used in the chemical activation process 

is treated with a strong chemical agent, 

including but not limited to phosphoric 

acid, zinc chloride sulfuric acid or 

potassium hydroxide, that dehydrates 

molecules in the raw material, and 

results in the formation of water that is 

removed from the raw material by 

moderate heat treatment. The activated 

carbon created by chemical activation 

has internal porosity developed 

primarily due to the action of the 

chemical dehydration agent. Chemically 

activated carbons are typically used to 

activate raw materials with a 

lignocellulosic component such as 

cellulose, including wood, sawdust, 

paper mill waste and peat. 

To the extent that an imported 

activated carbon product is a blend of 

steam and chemically activated carbons, 

products containing 50 percent or more 

steam (or CO2 gas) activated carbons are 

within this scope, and those containing 

more than 50 percent chemically 

activated carbons are outside this scope. 

Also excluded from the scope are 

reactivated carbons. Reactivated carbons 

are previously used activated carbons 

that have had adsorbed materials 

removed from their pore structure after 

use through the application of heat, 

steam and/or chemicals. 

Also excluded from the scope is 

activated carbon cloth. Activated carbon 

cloth is a woven textile fabric made of 

or containing activated carbon fibers. It 

is used in masks and filters and clothing 

of various types where a woven format 

is required. 

Any activated carbon meeting the 

physical description of subject 

merchandise provided above that is not 

expressly excluded from the scope is 

included within this scope. The 


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16758 Federal Register / Vol. 71, No. 64 / Tuesday, April 4, 2006 / Notices 

1We received additional submissions from the 

importers on March 21, 22, and 24, 2006. 

Petitioners responded to these submissions on 

March 22 and March 28, 2006. 

products under investigation are 

currently classifiable under the 

Harmonized Tariff Schedule of the 

United States (‘‘HTSUS’’) subheading 

3802.10.00. Although HTSUS 

subheadings are provided for 

convenience and customs purposes, the 

written description of the scope of this 

investigation is dispositive. 

Comments on Scope of Investigation 

During our review of the petition, we 

discussed the scope with Petitioners to 

ensure that it accurately reflects the 

product for which the domestic industry 

is seeking relief. Petitioners had 

previously filed a petition on activated 

carbon from the People’s Republic of 

China on January 26, 2006. On March 8, 

2006, Petitioners filed a petition on 

certain activated carbon from the 

People’s Republic of China. This 

petition changed the scope and 

domestic like product definition from 

the January 26, 2006 petition, which 

was subsequently withdrawn, to 

exclude chemically activated carbons. 

In the March 8, 2006, petition on certain 

activated carbon, Petitioners addressed 

their determination to limit the scope to 

only steam activated carbons and 

submitted information to support their 

assertion that chemical and steam 

activated carbons should not be 

considered within the scope or the 

domestic like product. 

Moreover, as discussed in the 

preamble to the Department’s 

regulations, we are setting aside a 

period for interested parties to raise 

issues regarding product coverage. See 

Antidumping Duties; Countervailing 

Duties; Final Rule, 62 FR 27296, 27323 

(May 19, 1997). The Department 

encourages all interested parties to 

submit such comments within 20 

calendar days of publication of this 

initiation notice. Comments should be 

addressed to Import Administration’s 

Central Records Unit in Room 1870, 

U.S. Department of Commerce, 14th 

Street and Constitution Avenue, NW, 

Washington, DC 20230 - Attention: 

Catherine Bertrand and Carrie Blozy, 

Room 4003. The period of scope 

consultations is intended to provide the 

Department with ample opportunity to 

consider all comments and consult with 

interested parties prior to the issuance 

of the preliminary determination. 

Determination of Industry Support for 

the Petition 

Section 732(b)(1) of the Act requires 

that a petition be filed by or on behalf 

of the domestic industry. In order to 

determine whether a petition has been 

filed by or on behalf of the industry, the 

Department, pursuant to section 

732(c)(4)(A) of the Act, determines 

whether 

a minimum percentage of the relevant 

industry supports the petition. A 

petition meets this requirement if the 

domestic producers or workers who 

support the petition account for: (i) At 

least 25 percent of the total production 

of the domestic like product; and (ii) 

more than 50 percent of the production 

of the domestic like product produced 

by that portion of the industry 

expressing support for, or opposition to, 

the petition. Moreover, section 

732(c)(4)(D) of the Act provides that, if 

the petition does not establish support 

of domestic producers or workers 

accounting for more than 50 percent of 

the total production of the domestic like 

product, the Department shall: (i) poll 

the industry or rely on other 

information in order to determine if 

there is support for the petition, as 

required by subparagraph (A), or (ii) 

determine industry support using a 

statistically valid sampling method. 

Section 771(4)(A) of the Act defines 

the ‘‘industry’’ as the producers of a 

domestic like product. Thus, to 

determine whether a petition has the 

requisite industry support, the statute 

directs the Department to look to 

producers and workers who produce the 

domestic like product. The International 

Trade Commission (‘‘ITC’’), which is 

responsible for determining whether 

‘‘the domestic industry’’ has been 

injured, must also determine what 

constitutes a domestic like product in 

order to define the industry. While both 

the Department and the ITC must apply 

the same statutory definition regarding 

the domestic like product (section 

771(10) of the Act), they do so for 

different purposes and pursuant to a 

separate and distinct authority. In 

addition, the Department’s 

determination is subject to limitations of 

time and information. Although this 

may result in different definitions of the 

like product, such differences do not 

render the decision of either agency 

contrary to law. See USEC, Inc. v. 

United States, 132 F. Supp. 2d 1, 8 (CIT 

2001), citing Algoma Steel Corp. Ltd. v. 

United States, 688 F. Supp. 639, 644 

(1988), aff’d 865 F.2d 240 (Fed. Cir. 

1989), cert. denied 492 U.S. 919 (1989). 

Section 771(10) of the Act defines the 

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 under this title.’’ Thus, the 

reference point from which the 

domestic like product analysis begins is 

‘‘the article subject to an investigation,’’

(i.e., the class or kind of merchandise to 

be investigated, which normally will be 

the scope as defined in the petition). 

With regard to the domestic like 

product, Petitioner does not offer a 

definition of domestic like product 

distinct from the scope of the 

investigation. Based on our analysis of 

the information submitted on the 

record, we have determined that certain 

activated carbon constitutes a single 

domestic like product and we have 

analyzed industry support in terms of 

that domestic like product. For a 

discussion of the domestic like product 

analysis in this case, see the Initiation 

Checklist, at Attachment I (Industry 

Support). 

On March 15, 2006, we received an 

industry support challenge from 

importers of activated carbon.1 We also 

received a letter of opposition to the 

petition from California Carbon, a U.S. 

producer of activated carbon, on March 

24, 2006. See Initiation Checklist at 

Attachment I (Industry Support). Our 

review of the data provided in the 

petition, supplemental submissions, and 

other information readily available to 

the Department indicates that 

Petitioners have established industry 

support representing at least 25 percent 

of the total production of the domestic 

like product; and more than 50 percent 

of the production of the domestic like 

product produced by that portion of the 

industry expressing support for or 

opposition to the petition, requiring no 

further action by the Department 

pursuant to section 732(c)(4)(D) of the 

Act. Therefore, the domestic producers 

(or workers) who support the petition 

account for at least 25 percent of the 

total production of the domestic like 

product, and the requirements of section 

732(c)(4)(A)(i) of the Act are met. 

Furthermore, the domestic producers 

who support the petition account for 

more than 50 percent of the production 

of the domestic like product produced 

by that portion of the industry 

expressing support for, or opposition to, 

the petition. Thus, the requirements of 

section 732(c)(4)(A)(ii) of the Act also 

are met. Accordingly, the Department 

determines that the petition was filed on 

behalf of the domestic industry within 

the meaning of section 732(b)(1) of the 

Act. See Initiation Checklist at 

Attachment I (Industry Support). 

The Department finds that Petitioners 

filed the petition on behalf of the 

domestic industry because they are an 

interested party as defined in sections 

771(9)(E) and (F) of the Act and they 


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have demonstrated sufficient industry 

support with respect to the antidumping 

investigation that they are requesting 

the Department initiate. See Initiation 

Checklist at Attachment I (Industry 

Support). 

Export Price 

Petitioners relied on three U.S. prices 

for certain activated carbon 

manufactured in the PRC and offered for 

sale in the United States. Two prices 

were for POI sales of PAC and the other 

was for a sale of GAC. In each case, the 

U.S. price was the winning bid listed on 

a publically available bid sheet from a 

U.S. municipal water authority buying 

activated carbon. Each bid sheet 

identifies the price, terms of sale, and 

supplier of the winning bid. Because 

each of the bid prices were for delivery 

to the applicable municipal water 

authority, Petitioners deducted from the 

price, the costs associated with 

exporting and delivering the product, 

including U.S. inland freight, the U.S. 

importer/distributor profit margin, 

ocean freight and insurance charges, 

U.S. duty, port and wharfage fees, 

foreign inland freight costs, and foreign 

brokerage and handling. The 

Department recalculated one export 

price to adjust the U.S. inland freight 

figure used by Petitioners. See Initiation 

Checklist. 

Normal Value 

Petitioners stated that the PRC is a 

non–market economy (‘‘NME’’) and no 

determination to the contrary has yet 

been made by the Department. In 

previous investigations, the Department 

has determined that the PRC is a NME. 

See Notice of Final Determination of 

Sales at Less Than Fair Value: 

Magnesium Metal from the People’s 

Republic of China, 70 FR 9037 

(February 24, 2005), Notice of Final 

Determination of Sales at Less Than 

Fair Value: Certain Tissue Paper 

Products from the People’s Republic of 

China, 70 FR 7475 (February 14, 2005), 

and 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). In 

accordance with section 771(18)(C)(i) of 

the Act, the presumption of NME status 

remains in effect until revoked by the 

Department. The presumption of NME 

status for the PRC has not been revoked 

by the Department and remains in effect 

for purposes of the initiation of this 

investigation. Accordingly, the normal 

value (‘‘NV’’) of the product is 

appropriately based on factors of 

production valued in a surrogate market 

economy country in accordance with 

section 773(c) of the Act. In the course 

of this investigation, all parties will 

have the opportunity to provide relevant 

information related to the issues of the 

PRC’s NME status and the granting of 

separate rates to individual exporters. 

Petitioners selected India as the 

surrogate country. Petitioners argued 

that, pursuant to section 773(c)(4) of the 

Act, India is an appropriate surrogate 

because it is a market–economy country 

that is at a comparable level of 

economic development to the PRC and 

is a significant producer and exporter of 

activated carbon. Based on the 

information provided by Petitioners, we 

believe that its use of India as a 

surrogate country is appropriate for 

purposes of initiating this investigation. 

After the initiation of the investigation, 

we will solicit comments regarding 

surrogate country selection. Also, 

pursuant to 19 CFR 351.301(c)(3)(i), 

interested parties will be provided an 

opportunity to submit publicly available 

information to value factors of 

production within 40 days after the date 

of publication of the preliminary 

determination. 

Petitioners provided three dumping 

margin calculations using the 

Department’s NME methodology as 

required by 19 CFR 351.202(b)(7)(i)(C). 

Petitioners calculated normal values 

based on consumption rates for 

producing activated carbon experienced 

by U.S. producers. In accordance with 

section 773(c)(4) of the Act, Petitioners 

valued factors of production, where 

possible, on reasonably available, public 

surrogate country data. To value certain 

factors of production, Petitioners used 

official Indian government import 

statistics, excluding those values from 

countries previously determined by the 

Department to be NME countries and 

excluding imports into India from 

Indonesia, Republic of Korea and 

Thailand, because the Department has 

previously excluded prices from these 

countries because they maintain 

broadly–available, non–industry 

specific export subsidies. See 

Automotive Replacement Glass 

Windshields From the People’s Republic 

of China: Final Results of 

Administrative Review, 69 FR 61790 

(October 21, 2004), and accompanying 

Issues and Decision Memorandum at 

Comment 5. 

For the surrogate value for coal, 

Petitioners only used coking coal 

imports into India from New Zealand. 

We have recalculated the normal values 

to use a surrogate value for coking coal 

that is based on Indian imports of 

coking coal from all sources, except 

those specifically excluded above due to 

NME status or availability of export 

subsidies. See Initiation Checklist for 

details of the recalculation. 

For inputs valued in Indian rupees 

and not contemporaneous with the POI, 

Petitioners used information from the 

wholesale price indices (‘‘WPI’’) in 

India as published by the International 

Monetary Fund in the International 

Financial Statistics to determine the 

appropriate adjustments for inflation. In 

addition, Petitioners made currency 

conversions, where necessary, based on 

the average rupee/U.S. dollar exchange 

rate for the POI, as reported on the 

Department’s Web site. 

For the normal value calculations, 

Petitioners derived the figures for 

factory overhead, selling, general and 

administrative expenses (‘‘SG&A’’), and 

profit from the financial ratios of an 

Indian activated carbon producer, Indo 

German Carbons Ltd. See Petition at 

page 63 and Initiation Checklist. 

Fair Value Comparisons 

Based on the data provided by 

Petitioners, there is reason to believe 

that imports of certain activated carbon 

from the PRC are being, or are likely to 

be, sold in the United States at less than 

fair value. Based upon comparisons of 

export price to the NV, calculated in 

accordance with section 773(c) of the 

Act, the estimated recalculated dumping 

margins for certain activated carbon 

from the PRC range from 114.33 percent 

to 333.66 percent. 

Allegations and Evidence of Material 

Injury and Causation 

Petitioners allege that the U.S. 

industry producing the domestic like 

product is being materially injured, or is 

threatened with material injury, by 

reason of the individual and cumulated 

imports of the subject merchandise sold 

at less than NV. Petitioners contend that 

the industry’s injured condition is 

illustrated by the decline in customer 

base, market share, domestic shipments, 

prices and financial performance. We 

have assessed the allegations and 

supporting evidence regarding material 

injury and causation, and we have 

determined that these allegations are 

properly supported by adequate 

evidence and meet the statutory 

requirements for initiation. See 

Initiation Checklist at Attachment II 

(Injury). 

Separate Rates and Quantity and Value 

Questionnaire 

The Department recently modified the 

process by which exporters and 

producers may obtain separate–rate 

status in NME investigations. See Policy 

Bulletin 05.1: Separate–Rates Practice 

and Application of Combination Rates 

in Antidumping Investigations 


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involving Non–Market Economy 

Countries (Separate Rates and 

Combination Rates Bulletin), (April 5, 

2005), available on the Department’s 

Web site at http://ia.ita.doc.gov. The 

process now requires the submission of 

a separate–rate status application. Based 

on our experience in processing the 

separate rates applications in the 

antidumping duty investigations of 

Certain Artist Canvas from the People’s 

Republic of China, Diamond Sawblades 

and Parts Thereof from the People’s 

Republic of China and the Republic of 

Korea and Ceratin Lined Paper Products 

from India, Indonesia, and the People’s 

Republic of China, we have modified 

the application for this investigation to 

make it more administrable and easier 

for applicants to complete. See 

Initiation of Antidumping Duty 

Investigation: Certain Artist Canvas 

From the People’s Republic of China, 70 

FR 21996, 21999 (April 28, 2005), 

Initiation of Antidumping Duty 

Investigations: Diamond Sawblades and 

Parts Thereof from the People’s 

Republic of China and the Republic of 

Korea, 70 FR 35625, 35629 (June 21, 

2005), and Initiation of Antidumping 

Duty Investigations: Certain Lined Paper 

Products from India, Indonesia, and the 

People’s Republic of China, 70 FR 

58374, 58379 (October 6, 2005). The 

specific requirements for submitting the 

separate–rates application in this 

investigation are outlined in detail in 

the application itself, which will be 

available on the Department’s Website 

at http://ia.ita.doc.gov on the date of 

publication of this initiation notice in 

the Federal Register. Please refer to this 

application for all instructions. 

NME Respondent Selection and 

Quantity and Value Questionnaire 

For NME investigations, it is the 

Department’s practice to request 

quantity and value information from all 

known exporters identified in the 

petition. In addition, the Department 

typically requests the assistance of the 

NME government in transmitting the 

Department’s quantity and value 

questionnaire to all companies who 

manufacture and export subject 

merchandise to the United States, as 

well as to manufacturers who produce 

the subject merchandise for companies 

who were engaged in exporting subject 

merchandise to the United States during 

the period of investigation. The quantity 

and value data received from NME 

exporters is used as the basis to select 

the mandatory respondents. Although 

many NME exporters respond to the 

quantity and value information request, 

at times some exporters may not have 

received the quantity and value 

questionnaire or may not have received 

it in time to respond by the specified 

deadline. 

The Department is now publicizing its 

requirement that quantity and value 

responses must be submitted for both 

the quantity and value questionnaire 

and the separate–rates application by 

the respective deadlines in order to 

receive consideration for separate–rate 

status. This new procedure will be 

applied to all future investigations. 

Appendix I of this notice contains the 

quantity and value questionnaire that 

must be submitted by all NME 

exporters. In addition, the Department 

will post the quantity and value 

questionnaire along with the filing 

instructions on the IA Website (http:// 

ia.ita.doc.gov). This quantity and value 

questionnaire is due no later than 15 

calendar days from the date of 

publication of this notice. Consistent 

with Department practice, if a deadline 

falls on a weekend, federal holiday, or 

any other day when the Department is 

closed, the Department will accept the 

response on the next business day. See 

Notice of Clarification: Application of 

‘‘Next Business Day’’ rule for 

Administrative Determination Deadlines 

Pursuant to the Tariff Act of 1930, as 

amended, 70 FR 24533 (May 10, 2005). 

The Department will continue to send 

the quantity and value questionnaire to 

those exporters identified in the petition 

and the NME government. 

Use of Combination Rates in an NME 

Investigation 

The Department will calculate 

combination rates for certain 

respondents that are eligible for a 

separate rate in this investigation. The 

Separate Rates and Combination Rates 

Bulletin, 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. 

Separate Rates and Combination 

Rates Bulletin, at page 6. 

Initiation of Antidumping Investigation 

Based upon our examination of the 

petition on certain activated carbon 

from the PRC, we find that this petition 

meets the requirements of section 732 of 

the Act. Therefore, we are initiating an 

antidumping duty investigation to 

determine whether imports of certain 

activated carbon from the PRC are being, 

or are likely to be, sold in the United 

States at less than fair value. Unless 

postponed, we will make our 

preliminary determinations no later 

than 140 days after the date of these 

initiations. 

Distribution of Copies of the Petition 

In accordance with section 

732(b)(3)(A) of the Act, a copy of the 

public version of the petition has been 

provided to the government of the PRC. 

International Trade Commission 

Notification 

We have notified the ITC of our 

initiation, as required by section 732(d) 

of the Act. 

Preliminary Determination by the ITC 

The ITC will preliminarily determine, 

within 25 days after the date on which 

it receives notice of this initiation, 

whether there is a reasonable indication 

that imports of certain activated carbon 

from the PRC are causing material 

injury, or threatening to cause material 

injury, to a U.S. industry. See section 

733(a)(2) of the Act. A negative ITC 

determination will result in the 

investigation being terminated; 

otherwise, this investigation will 

proceed according to statutory and 

regulatory time limits. 

This notice is issued and published 

pursuant to section 777(i) of the Act. 

Dated: March 28, 2006. 

David M. Spooner. 

Assistant Secretaryfor Import Administration. 

APPENDIX I 

Where it is not practicable to examine 

all known producers/exporters of 

subject merchandise, section 777A(c)(2) 

of the Tariff Act of 1930 (as amended) 

permits us to investigate 1) a sample of 

exporters, producers, or types of 

products that is statistically valid based 

on the information available at the time 


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Federal Register / Vol. 71, No. 64 / Tuesday, April 4, 2006 / Notices 16761 

of selection, or 2) exporters and 

producers accounting for the largest 

volume and value of the subject 

merchandise that can reasonably be 

examined. 

In the chart provided below, please 

provide the total quantity and total 

value of all your sales of merchandise 

covered by the scope of this 

investigation (see scope section of this 

notice), produced in the PRC, and 

exported/shipped to the United States 

during the period July 1, 2005, through 

December 31, 2005. 

Market Total Quantity Terms of Sale Total Value 

United States 

1. Export 

Price Sales 

2. 

a. Exporter 

name 

b. Address 

c. Contact 

d. Phone 

No. 

e. Fax 

No. 

3. Constructed 

Export 

Price Sales 

4. Further 

Manufactured 

Total Sales 

Total Quantity 

• Please report quantity on a kilogram 

basis. If any conversions were used, 

please provide the conversion 

formula and source. 

Terms of Sales 

• Please report all sales on the same 

terms (e.g., free on board). 

Total Value 

• All sales values should be reported 

in U.S. dollars. Please indicate any 

exchange rates used and their 

respective dates and sources. 

Export Price Sales 

• Generally, a U.S. sale is classified as 

an export price sale when the first 

sale to an unaffiliated person occurs 

before importation into the United 

States. 

• Please include any sales exported by 

your company directly to the 

United States. 

• Please include any sales exported by 

your company to a third–country 

market economy reseller where you 

had knowledge that the 

merchandise was destined to be 

resold to the United States. 

• If you are a producer of subject 

merchandise, please include any 

sales manufactured by your 

company that were subsequently 

exported by an affiliated exporter to 

the United States. 

• Please do not include any sales of 

merchandise manufactured in Hong 

Kong in your figures. 

Constructed Export Price Sales 

• Generally, a U.S. sale is classified as 

a constructed export price sale 

when the first sale to an unaffiliated 

person occurs after importation. 

However, if the first sale to the 

unaffiliated person is made by a 

person in the United States 

affiliated with the foreign exporter, 

constructed export price applies 

even if the sale occurs prior to 

importation. 

• Please include any sales exported by 

your company directly to the 

United States. 

• Please include any sales exported by 

your company to a third–country 

market economy reseller where you 

had knowledge that the 

merchandise was destined to be 

resold to the United States. 

• If you are a producer of subject 

merchandise, please include any 

sales manufactured by your 

company that were subsequently 

exported by an affiliated exporter to 

the United States. 

• Please do not include any sales of 

merchandise manufactured in Hong 

Kong in your figures. 

Further Manufactured 

• Further manufacture or assembly 

costs include amounts incurred for 

direct materials, labor and 

overhead, plus amounts for general 

and administrative expense, interest 

expense, and additional packing 

expense incurred in the country of 

further manufacture, as well as all 

costs involved in moving the 

product from the U.S. port of entry 

to the further manufacturer. 

[FR Doc. E6–4864 Filed 4–3–06; 8:45 am] 

BILLING CODE 3510–DS–S 

DEPARTMENT OF COMMERCE 

International Trade Administration 

[A–122–822] 

Corrosion–Resistant Carbon Steel Flat 

Products from Canada: Notice of 

Extension of Time Limit for Preliminary 

Results of Antidumping Duty 

Administrative Review 

AGENCY: Import Administration, 

International Trade Administration, 

U.S. Department of Commerce. 

EFFECTIVE DATE: April 4, 2006. 

FOR FURTHER INFORMATION CONTACT: 

Douglas Kirby or Joshua Reitze, AD/ 

CVD Operations, Office 6, Import 

Administration, International Trade 

Administration, U.S. Department of 

Commerce, 14th Street and Constitution 

Avenue, NW., Washington, DC 20230; 

telephone: (202) 482–3782 or (202) 482–

0666, respectively. 


sroberts on PROD1PC70 with NOTICES
 
B-1

APPENDIX B

CONFERENCE WITNESSES

B-3

CALENDAR OF THE PUBLIC CONFERENCE

Those listed below appeared as witnesses at the United States International Trade Commission’s

conference:

Subject: Certain Activated Carbon from China

Inv No: 731-TA-1103 (Preliminary)

Date and Time: March 30, 2006 - 9:30 a.m.

The conference in connection with this investigation was held in the Main Hearing Room, 

500 E Street, SW, Washington, DC.

In Support of the Imposition of Antidumping Duties:

Collier Shannon Scott, PLLC

 Washington, DC

 on behalf of

Calgon Carbon Corporation and Norit Americas, Inc.

Ronald Thompson, President, Norit Americas, Inc.

Timothy Ruble, National Account Manager, Norit Americas, Inc.

Dennis Rester, Consultant, Norit Americas, Inc.

Robert O’Brien, Senior Vice-President, Calgon Carbon Corporation

James Gilmore, Director of Product Management, Calgon Carbon Corporation

Brad Hudgens, Economist, Georgetown Economic Services

David Rosner, Economist, Georgetown Economic Services

David A. Hartquist )

R. Alan Luberda )– OF COUNSEL

Mary T. Staley )
B-4

In Opposition to the Imposition of Antidumping Duties:

Bryan Cave, LLP

 Washington, DC

 on behalf of

The Coalition of Importers of Activated Carbon

David Jordan, Director, Product Services, U.S. Filter Environmental Services

J. Louis Kovach, President, Nucon International, Inc.

Joe Enneking, Vice-President, NUCON International, Inc.

Anders Skeini, President, Jacobi Carbons

Karl Krause, Business Manager, Jacobi Carbons

Sid Nelson, President, Sorbent Technologies

Stephen Clark, President, Water Tech, Inc.

Doug Gillen, Director, Environmental Products

Bill Brumfield, President, Carbon Link Corporation

Felipe Berer, International Trade Adviser, Bryan Cave

Lyle B. Vander Schaaf )

Corey L. Norton )– OF COUNSEL

Joseph H. Heckendorn )
C-1

APPENDIX C

SUMMARY DATA
C-2
C-3

Table C-1

Certain activated carbon: Summary data concerning the U.S. market, 2003-05

* * * * * * *

Table C-2

Chemically activated carbon: Summary data concerning the U.S. market, 2003-05

* * * * * * *

Table C-3

Total activated carbon: Summary data concerning the U.S. market, 2003-05

* * * * * * *

D-1

APPENDIX D

PRODUCER AND IMPORTER COMMENTS REGARDING

DIFFERENCES AND SIMILARITIES BETWEEN CHEMICALLY

ACTIVATED CARBON AND CERTAIN ACTIVATED CARBON
D-2
D-3

The Commission requested producers and importers to describe the differences and similarities

between chemically activated carbon and certain activated carbon with respect to: characteristics and

uses; interchangeability; manufacturing processes; channels of distribution; customer and producer

perceptions; and price. The responses follow:

Characteristics and Uses

* * * * * * *

Interchangeability

* * * * * * *

Manufacturing Processes

* * * * * * *

Channels of Distribution

* * * * * * *

Customer and Producer Perceptions

* * * * * * *

Price

* * * * * * *