U.S. International Trade Commission

Publication 4239 June 2011

Washington, DC 20436

Cased Pencils from China

Investigation No. 731-TA-669 (Third Review)
U.S. International Trade Commission

COMMISSIONERS 

 

Deanna Tanner Okun, Chairman 

Irving A. Williamson, Vice Chairman 

Charlotte R. Lane 

Daniel R. Pearson 

Shara L. Aranoff 

Dean A. Pinkert

Robert B. Koopman

Staff assigned

Address all communications to 

Secretary to the Commission 

United States International Trade Commission 

Washington, DC 20436

Acting Director of Operations

Mary Messer, Investigator 

Ralph Watkins, Industry Analyst 

David Fishberg, Attorney 

Mary Messer, Acting Supervisory Investigator
U.S. International Trade Commission

Washington, DC 20436 

www.usitc.gov

Publication 4239 June 2011

Cased Pencils from China

Investigation No. 731-TA-669 (Third Review)

CONTENTS

Page

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

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

Information obtained in the review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-1

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-3

Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-3

The original investigation and subsequent five-year reviews . . . . . . . . . . . . . . . . . . . . . . . . . I-4

Commerce’s final result of expedited third five-year review . . . . . . . . . . . . . . . . . . . . . . . . . I-6

Commerce’s administrative reviews . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-6

Distribution of Continued Dumping and Subsidy Offset Act funds to affected domestic 

producers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-10

Related Commission investigations and reviews . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-10

The product . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-13

Scope . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-13

U.S. tariff treatment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-14

Domestic like product and domestic industry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-14

Physical characteristics and uses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-15

Manufacturing process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-16

Interchangeability and customer and producer perceptions . . . . . . . . . . . . . . . . . . . . . . . . . . I-16

Channels of distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-17

Pricing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-18

The industry in the United States . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-19

U.S. producers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-19

U.S. producers’ trade, employment, and financial data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-20

Related party issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-21

U.S. imports and apparent U.S. consumption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-22

U.S. importers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-22

U.S. imports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-23

Ratio of imports to U.S. production . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-28

Apparent U.S. consumption and market shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-28

Antidumping actions outside the United States . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-30

The subject industry in China . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-30

The global market . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-37

Appendix

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

B. Commission’s statement on adequacy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-1

C. Purchaser responses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . C-1

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

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

i

UNITED STATES INTERNATIONAL TRADE COMMISSION

 Investigation No. 731-TA-669 (Third Review) 

 CASED PENCILS FROM CHINA 

DETERMINATION

On the basis of the record1

 developed in the subject five-year review, 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)), that revocation of the antidumping duty order on cased pencils from China 

would be likely to lead to continuation or recurrence of material injury to an industry in the United States 

within a reasonably foreseeable time. 

BACKGROUND

The Commission instituted this review on November 1, 2010 (75 FR 67102) and determined on 

February 4, 2011 that it would conduct an expedited review (76 FR 11267, March 1, 2011). 

 

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

VIEWS OF THE COMMISSION

Based on the record in this five-year review, we determine under section 751(c) of the Tariff Act

of 1930, as amended (the Act), that revocation of the antidumping duty order on cased pencils from China

is likely to lead to continuation or recurrence of material injury to an industry in the United States within

a reasonably foreseeable time.

I. BACKGROUND

In December 1994, the Commission determined that an industry in the United States was

threatened with material injury by reason of less than fair value (“LTFV”) imports of cased pencils from

China,1

 and on December 28, 1994, the Department of Commerce (“Commerce”) issued an antidumping

duty order on imports of cased pencils from China.2

 On December 1, 1999, the Commission instituted its first five-year review pursuant to section

751(c) of the Act to determine whether revocation of the antidumping duty order on cased pencils from

China would be likely to lead to continuation or recurrence of material injury.3

 The Commission

determined that the individual and group domestic interested party responses to its notice of institution

were adequate. The Commission also found that the individual response of an importer of subject

merchandise was adequate. However, because no respondent interested party other than that importer

responded to the notice of institution, and the importer accounted for only a small portion of subject

import volume, the Commission determined that the respondent interested party group response was

inadequate. In the absence of any other circumstances warranting a full review, the Commission decided

to conduct an expedited review pursuant to section 751(c)(3) of the Act.4

 In that review, the Commission

determined that revocation of the antidumping duty order covering cased pencils from China would likely

 1 Cased Pencils from China, Inv. No. 731-TA- 669 (Final), USITC Pub. 2816 (Dec. 1994) (“Original

Determination”). Five Commissioners made affirmative determinations, three on the basis of a threat of material

injury and two on the basis of current material injury. One Commissioner made a negative determination. The

petition in the original investigation concerned Thailand, as well as China. The Commission made a final negative

determination with respect to imports from Thailand, which were negligible and therefore not cumulated with

imports from China. See Certain Cased Pencils from Thailand, Inv. No. 731-TA-670 (Final), USITC Pub. 2816

(Oct. 1994). 

 2 59 Fed. Reg. 66909 (Dec. 28, 1994). Excluded from the antidumping duty order as originally issued were cased

pencils exported by China First and those exported by Guangdong that were manufactured by Three Star. China

First was subsequently included under the order in an amended determination by Commerce in a voluntary remand. 

See Writing Instrument Mfrs. v. U.S. Department of Commerce, 21 CIT 1185, 984 F. Supp. 629 (1997), aff’d 178 F.

3d 1311 (Fed. Cir. 1998); Notice of Court Decision: Certain Cased Pencils from the People’s Republic of China, 62

Fed. Reg. 65243 (Dec. 11, 1997); Certain Cased Pencils from the People’s Republic of China; Notice of Amended

Final Determination of Sales at Less Than Fair Value and Amended Antidumping Duty Order In Accordance With

Final Court Decision, 64 Fed. Reg. 25275 (May 11, 1999). Thereafter, Commerce found that Three Star and China

First were in fact the same entity and Commerce, therefore, no longer excluded the Three Star/Guangdong sales

chain from the order. Certain Cased Pencils from the People’s Republic of China; Final Results and Partial

Rescission of Antidumping Duty Administrative Review, 67 Fed. Reg. 48612, 48613 (July 25, 2002). 

 3 64 Fed. Reg. 67304 (December 1, 1999).

 4 Cased Pencils from China, Inv. No. 731-TA-669 (Review), USITC Pub. 3328 (June 2000) (“First Five-Year

Review Determination”) at Attachment A (Explanation of Commission Determination on Adequacy).

3
lead to continuation or recurrence of material injury to an industry in the United States within a

reasonably foreseeable time.5

 

The Commission instituted the second five-year review on July 1, 2005.6

 On October 4, 2005,

the Commission determined that the domestic interested party group response to its notice of institution

was adequate. The Commission did not receive a response from any respondent interested party and

therefore determined that the respondent interested party group response to the notice of institution was

inadequate. In the absence of an adequate respondent interested party group response or other

circumstances warranting a full review, the Commission decided to conduct an expedited review pursuant

to section 751(c)(3) of the Act. In that review, the Commission determined that revocation of the

antidumping duty order covering cased pencils from China would be likely to lead to continuation or

recurrence of material injury to an industry in the United States within a reasonably foreseeable time.7

 

The Commission instituted this third review on November 1, 2010.8

 On February 4, 2011, the

Commission determined that the domestic interested party group response to its notice of institution was

adequate, but that the respondent interested party group response was inadequate.9

 In the absence of an

adequate respondent interested party group response, or other factors warranting a full review, the

Commission determined to conduct an expedited review pursuant to section 751(c)(3) of the Act.10 11

Domestic producer Dixon Ticonderoga Co. (“Dixon Ticonderoga”) responded to the Commission’s notice

of institution and filed comments, and domestic producers Sanford, L.P. (“Sanford”), General Pencil Co.,

Inc. (“General Pencil”), and Musgrave Pencil Co. (“Musgrave Pencil”), jointly responded to the

Commission’s notice of institution and filed comments. No respondent interested party has provided any

information or argument to the Commission.

II. DOMESTIC LIKE PRODUCT AND INDUSTRY

A. Domestic Like Product

In making its determination under section 751(c), the Commission defines the “domestic like

product” and the “industry.”12 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 subtitle.”13 The Commission’s practice in five-year reviews is to look to the like product

 5 First Five-Year Review Determination.

 6 70 Fed. Reg. 38192 (July 1, 2005).

 7 Cased Pencils from China, Inv. No. 731-TA-669 (Second Review), USITC Pub. 3820 (Nov. 2005) (“Second

Five-Year Review Determination”). 

 8 75 Fed. Reg. 67102 (Nov. 1, 2010).

 9 See Confidential Staff Report (“CR”) at Appendix B.

 10 19 U.S.C. § 1675(c)(3).

 11 See CR at Appendix B.

 12 19 U.S.C. § 1677(4)(A).

 13 19 U.S.C. § 1677(10). See Nippon Steel Corp. v. United States, 19 CIT 450, 455 (1995); Timken Co. v.

United States, 913 F. Supp. 580, 584 (Ct. Int’l Trade 1996); Torrington Co. v. United States, 747 F. Supp. 744, 748-

49 (Ct. Int’l Trade 1990), aff’d, 938 F.2d 1278 (Fed. Cir. 1991). See also S. Rep. No. 249, 96th Cong., 1st Sess. 90-

91 (1979).

4
definition from the original determination and any previous reviews and consider whether the record

indicates any reason to revisit that definition.14

In this five-year review, Commerce has defined the scope of the antidumping duty order as

follows:

Imports covered by the order are shipments of certain cased pencils of any

shape or dimension (except as described below) which are writing and/or

drawing instruments that feature cores of graphite or other materials, encased in

wood and/or man-made materials, whether or not decorated and whether or not

tipped (e.g., with erasers, etc.) in any fashion, and either sharpened or

unsharpened. The pencils subject to the order are currently classifiable under

subheading 9609.10.00 of the Harmonized Tariff Schedule of the United States

(“HTSUS”). Specifically excluded from the scope of the order are mechanical

pencils, cosmetic pencils, pens, noncased crayons (wax), pastels, charcoals,

chalks, and pencils produced under U.S. patent number 6,217,242, from paper

infused with scents by the means covered in the above-referenced patent,

thereby having odors distinct from those that may emanate from pencils lacking

the scent infusion. Also excluded from the scope of the order are pencils with

all of the following physical characteristics: (1) Length: 13.5 or more inches;

(2) sheath diameter: not less than one-and-one quarter inches at any point

(before sharpening); and (3) core length: Not more than 15 percent of the

length of the pencil. In addition, pencils with all of the following physical

characteristics are excluded from the scope of the order: Novelty jumbo pencils

that are octagonal in shape, approximately ten inches long, one inch in diameter

before sharpening, and three-and-one eighth inches in circumference, composed

of turned wood encasing one-and-one half inches of sharpened lead on one end

and a rubber eraser on the other end. Although the HTSUS subheading is

provided for convenience and customs purposes, the written description of the

scope of the order is dispositive.15

 14 See Stainless Steel Sheet and Strip from France, Germany, Italy, Japan, Korea, Mexico, Taiwan and the United

Kingdom, Inv. No. 701-TA-380-382 and 731-TA-797-804 (Review), USITC Pub. 3788 (July 2005) at 6; Crawfish

Tail Meat from China, Inv. No. 731-TA-752 (Review), USITC Pub. 3614 (July 2003) at 4; Steel Concrete

Reinforcing Bar from Turkey, Inv. No. 731-TA-745 (Review), USITC Pub. 3577 (Feb. 2003) at 4.

 15 76 Fed. Reg. 12323 (March 7, 2011). Commerce has issued the following scope rulings with respect to cased

pencils from China: (1) Inspired Design LLC-Pedestal Pets pencil sets are within the scope of the order; (2) It’s

Academic compasses with pencils are outside the scope of the order; (3) Paper Magic Group children’s valentine

card sets with pencils are outside the scope of the order; (4) Walgreen Co. three graphite pencils and three cased

charcoal drawing pencils contained in “Artskills Draw & Sketch Kit” are within the scope of the order; (5) the

remaining items contained in Walgreen’s “Artskills Draw & Sketch Kit,” including one pencil sharpener, one

sanding pad, one black eraser, one kneaded eraser and one tortillion, are outside the scope of the order; (6)

Walgreen’s “ArtSkills Stencil Kit” is not within scope of the order; (7) The Smencil Co. pencils made from recycled

newspaper packaged in plastic cylinders along with scent applicators in the “Smencils Home Kit” and “Smencils

Mini Kit” are within the scope of the order; (8) Fiskars Brands, Inc. compasses are not included in the scope of the

order; (9) Rich Frog Industries Inc. decorated wooden gift pencils are within the scope of the order; (10) Target

Corp. RoseArt Clip ‘N Color is excluded from the scope of the order; (11) Barthco Trade Consultants twist crayons

are outside the scope of the order; (12) Target Corp. “Hello Kitty Fashion Totes” are outside the scope of the order;

(13) Target Corp. “Hello Kitty Memory Maker” is outside the scope of the order; (14) Target Corp. “Crayola the

Wave” is outside the scope of the order; (15) Creative Designs International, Ltd. “Naturally Pretty,” a young girl’s

(continued...)

5
In its determination in the original investigation, the Commission found a single domestic like

product consisting of all domestically produced cased pencils, including raw pencils, which are

essentially unfinished case pencils.16 The Commission explained that “[a]lthough the physical

characteristics of raw and unfinished cased pencils differ slightly in that the latter are lacquered and may

contain a ferrule and an eraser, both items can act as hand held writing instruments and can perform the

same function -- writing.”17 Moreover, the Commission found that all cased pencils shared the same end

uses, channels of distribution, manufacturing facilities, and production employees.18

In the first and second five-year reviews, the Commission adhered to that domestic like product

definition, noting that there was no new information obtained during those five-year reviews that

suggested a reason for departing from the Commission’s original definition of the domestic like product,

and that no party had argued for a different definition.19 

In this third five-year review, there is no new information that would suggest a reason for

departing from the Commission’s prior definitions of the domestic like product, and no party has argued

for a different domestic like product definition. We therefore continue to define the domestic like product

as all cased pencils, coextensive with Commerce’s scope.

B. Domestic Industry

Section 771(4)(A) of the Act defines the relevant domestic industry as the “producers as a whole

of a domestic like product, or those producers whose collective output of a domestic like product

constitutes a major proportion of the total domestic production of the product.”20

The domestic interested parties identify the following eight firms as current U.S. manufacturers

of cased pencils: Sanford, General Pencil, Musgrave Pencil, Rose Moon, Dixon Ticonderoga, Aakron

Rule Co., Panda Pencil Co., and Harcourt Pencil Co.21 

The only issue that arises in this third five-year review with respect to our definition of the

domestic industry is whether any producer should be excluded under the related parties provision, 19

U.S.C. § 1677(4)(B). Section 771(4)(B) of the Act allows the Commission, if appropriate circumstances

 15 (...continued)

10 piece dress-up vanity set, including two 3-inch pencils, is outside the scope of the order; and (16) Nadel Trading

Corp. plastic “quasi-mechanical” pencil known as the Bensia pencil is outside the scope of the order. Issues and

Decision Memorandum for the Final Results of the Expedited Third Five-Year Sunset Review of the Antidumping

Duty Order on Certain Cased Pencils from the People’s Republic of China, March 1, 2011, p. 4.

Commerce has also made the following three changed circumstances findings with respect to cased pencils: 

(1) certain scent-infused pencils manufactured in China under U.S. patent number 6,217,242 (“Smencils”) are

excluded from the order; (2) certain large novelty pencils that meet specific size and graphite characteristics are

excluded from the order; and (3) certain novelty jumbo pencils that meet specific size, encasing and graphite

characteristics are excluded from the order. Id. at 3.

 16 Original Determination at I-7.

 17 Original Determination at I-7. 

 18 Original Determination at I-6.

 19 First Five-year Review Determination at 5; Second Five-Year Review Determination at 5.

 20 19 U.S.C. § 1677(4)(A). In defining the domestic industry, the Commission’s general practice has been to

include in the industry producers of all domestic production of the like product, whether toll-produced, captively

consumed, or sold in the domestic merchant market, provided that adequate production-related activity is conducted

in the United States. See United States Steel Group v. United States, 873 F. Supp. 673, 682-83 (Ct. Int’l Trade

1994), aff’d, 96 F.3d 1352 (Fed. Cir. 1996).

 21 CR at I-25, PR at I-19-20. 

6
exist, to exclude from the domestic industry producers that are related to an exporter or importer of

subject merchandise, or which are themselves importers.22

In the original investigation the Commission found that one domestic producer, Pentech, was a

related party and that appropriate circumstances existed to exclude Pentech from the domestic industry.23

In the first five-year review, the Commission did not find appropriate circumstances to exclude any

domestic producer from the domestic industry.24

In the second five-year review period, the Commission found that one domestic producer, ***,

was a related party, but did not find that appropriate circumstances existed to exclude it from the domestic

industry.25 The Commission also stated that another domestic producer, Dixon Ticonderoga, had a related

pencil production facility in China, but noted that the record contained no information on the extent of

Dixon Ticonderoga’s ownership of the facility in China or whether Dixon Ticonderoga imported subject

merchandise.26 In the absence of further information on Dixon Ticonderoga’s ownership and importation

interests or any argument that it should be excluded as a related party, the Commission found that

appropriate circumstances did not exist to exclude Dixon Ticonderoga from the domestic industry.27

 22 The primary factors the Commission has examined in deciding whether appropriate circumstances exist to

exclude a related party include the following:

(1) the percentage of domestic production attributable to the importing producer;

(2) the reason the U.S. producer has decided to import the product subject to investigation, i.e., whether the

firm benefits from the LTFV sales or subsidies or whether the firm must import in order to enable it to

continue production and compete in the U.S. market; and

(3) the position of the related producer vis-a-vis the rest of the industry, i.e., whether inclusion or exclusion

of the related party will skew the data for the rest of the industry.

See, e.g., Torrington Co. v. United States, 790 F. Supp. 1161 (Ct. Int’l Trade 1992), aff’d without opinion, 991 F.2d

809 (Fed. Cir. 1993).

The Commission has also concluded that a domestic producer that does not itself import subject

merchandise, or does not share a corporate affiliation with an importer, may nonetheless be deemed a related party if

it controls large volumes of imports. The Commission has found such control to exist where the domestic producer

was responsible for a predominant proportion of an importer’s purchases and the importer’s purchases were

substantial. See, e.g., Foundry Coke from China, Inv. No. 731-TA-891 (Final), USITC Pub. 3449 (September 2001)

at 8-9.

 23 Original Determination at I-8 to I-9. The Commission excluded Pentech from the industry because it had

benefitted from LTFV imports and was shielded from negative effects of those imports. 

 24 The Commission found that one domestic producer, ***, had imported subject cased pencils, but found that

appropriate circumstances did not exist to exclude *** from the domestic industry because the limited information in

that record did not indicate the extent of *** importation activities, and because *** appearance in the review as a

domestic producer supporting continuation of the order suggested that it did not import significant volumes or was

not likely to do so if the order were revoked. First Five-Year Review Determination at 6. Also in the first five-year

review, an importer alleged that another producer, Sanford, had imported the subject merchandise, but domestic

producers refuted the claim, and the Commission concluded that Sanford had not imported subject merchandise.

 25 Second Five-Year Review Determination at 6. The Commission found that *** imported cased pencils from

China and is related to ***, which imported decorator pencils from China, and was therefore, a related party. The

Commission stated that the limited information on the record of that review did not indicate the extent of ***

importation activities, but *** had appeared in that review as a domestic producer in support of continuation of the

order, rather than as an importer. Moreover, *** stated that its primary interest was in domestic production rather

than importation, and no party had requested ***. 

 26 Second Five-Year Review Determination at 6.

 27 Second Five-Year Review Determination at 6. The Commission noted that Dixon Ticonderoga was estimated

to account for *** percent of domestic production, a share greater than that of any of the responding domestic

(continued...)

7
In this third review, Dixon Ticonderoga reported in its response that, in addition to producing the

domestic like product, it is also currently a U.S. importer of the subject merchandise.28 Dixon

Ticonderoga also reported that it now wholly owns Beijing Fila Dixon Stationary Co., Ltd., a Chinese

producer and exporter of the subject merchandise.29 Consequently, Dixon Ticonderoga is a related party

as defined by the statute both by virtue of its importation as well as by virtue of its ownership of a

Chinese exporter of subject merchandise. 

We find that appropriate circumstances exist to exclude Dixon Ticonderoga from the domestic

industry as a related party. In the second review, the Commission reported that although Dixon

Ticonderoga continued to manufacture cased pencils in the United States, it had shifted much of its pencil

production to China in 2002.30 Moreover, for the one year of the current period of review for which the

Commission has data, 2009, Dixon Ticonderoga has been *** an importer of subject merchandise. Dixon

Ticonderoga reported that, in 2009, it produced *** gross of cased pencils in the United States and

imported *** gross of subject cased pencils from related and unrelated pencil producers in China

combined, a ratio of *** percent of U.S. imports to U.S. production. Dixon Ticonderoga also reported

that its Chinese subsidiary produced and exported to the United States *** gross of subject cased pencils

in 2009 for a ratio of *** percent exports to the United States to Dixon Ticonderoga’s U.S. production.31

Dixon Ticonderoga was *** domestic producer of cased pencils, accounting for *** percent of total U.S.

production based on the aggregate 2009 U.S. production data provided in the responses to the

Commission’s notice of institution.32 Although Dixon Ticonderoga was a Petitioner in the original

investigation, and responded to the notice of institution and provided comments in this review in support

of continuation of the order, we find that the evidence demonstrates that its primary focus has shifted to

importation. Based on the limited record in this expedited review, Chairman Okun and Commissioner

Pearson also find that Dixon Ticonderoga may have derived some benefit due to its related party status as

***.33 Commissioners Aranoff and Pinkert, however, consistent with their respective practices regarding

domestic industry exclusion, do not rely on Dixon Ticonderoga’s financial performance in excluding it

 27 (...continued)

producers except Sanford. Accordingly, whatever its other interests, the Commission found that Dixon Ticonderoga

had a significant commitment to domestic production. 

 28 Response of Dixon Ticonderoga, December 1, 2010, p. 7; and Supplemental Response of Dixon Ticonderoga,

January 6, 2011.

 29 Response of Dixon Ticonderoga, December 1, 2010, p. 7; and Supplemental Response of Dixon Ticonderoga,

January 6, 2011. 

 30 CR at I-30, PR at I-22.

 31 Response of Dixon Ticonderoga, December 1, 2010, exh. 4; and Supplemental Response of Dixon

Ticonderoga, January 5, 2011, exhs. 3 and 4. 

 32 CR/PR at Table I-4. No party has requested its exclusion from the domestic industry. 

 33 Dixon Ticonderoga’s operating income was $*** in 2009, as compared to *** for Sanford, *** domestic

producer of cased pencils, and *** for Musgrave Pencil, *** domestic producer. CR/PR at Table I-4.

8
from the domestic industry. Accordingly, based on this record, the Commission finds that appropriate

circumstances exist to exclude Dixon Ticonderoga from the domestic industry as a related party.34 35

 

III. LIKELIHOOD OF CONTINUATION OR RECURRENCE OF MATERIAL INJURY IF

THE ANTIDUMPING DUTY ORDER IS REVOKED

A. Legal Standard in a Five-Year Review

In a five-year review conducted under section 751(c) of the Act, Commerce will revoke an

antidumping duty order unless: (1) it makes a determination that dumping or subsidization is likely to

continue or recur, and (2) the Commission makes a determination that revocation of the antidumping duty

order “would be likely to lead to continuation or recurrence of material injury within a reasonably

foreseeable time.”36 The SAA states that “under the likelihood standard, the Commission will engage in a

counter-factual analysis; it must decide the likely impact in the reasonably foreseeable future of an

important change in the status quo – the revocation or termination of a proceeding and the elimination of

its restraining effects on volumes and prices of imports.”37 Thus, the likelihood standard is prospective in

nature.38 The U.S. Court of International Trade has found that “likely,” as used in the sunset review

 34 Vice Chairman Williamson notes that the evidence is mixed on whether Dixon Ticonderoga should be

excluded as a related party. In particular, while its subject imports were *** domestic production in 2009, it was a

petitioner in the original investigation and appeared in this review in support of the order’s continuation. No party

has argued for its exclusion. Given the limited record in this expedited review, the Vice Chairman does not reach a

finding on this issue, as inclusion or exclusion of Dixon Ticonderoga does not affect his analysis or conclusions. 

Because ***, the Vice Chairman does not separately discuss the data he used in his analysis.

 35 While Commissioner Lane notes that Dixon Ticonderoga’s imports were *** domestic production in 2009, she

does not exclude it as a related party. The firm was a petitioner in the original investigation and appeared in this

review in support of continuation of the order. In addition, the data on the record of this expedited review regarding

its imports during the period of review are limited to one year. She further notes that her analysis is not impacted by

the majority’s decision to exclude Dixon Ticonderoga from the domestic industry, given the *** changes in the

relevant data.

 36 19 U.S.C. § 1675a(a).

 37 SAA, H.R. Rep. No. 103-316, vol. I, at 883-84 (1994). The SAA states that “[t]he likelihood of injury

standard applies regardless of the nature of the Commission’s original determination (material injury, threat of

material injury, or material retardation of an industry). Likewise, the standard applies to suspended investigations

that were never completed.” SAA at 883. 

 38 While the SAA states that “a separate determination regarding current material injury is not necessary,” it

indicates that “the Commission may consider relevant factors such as current and likely continued depressed

shipment levels and current and likely continued [sic] prices for the domestic like product in the U.S. market in

making its determination of the likelihood of continuation or recurrence of material injury if the order is revoked.” 

SAA at 884.

9
provisions of the Act, means “probable,” and the Commission applies that standard in five-year reviews.39

40 41

The statute states that “the Commission shall consider that the effects of revocation or termination

may not be imminent, but may manifest themselves only over a longer period of time.”42 According to

the SAA, a “‘reasonably foreseeable time’ will vary from case-to-case, but normally will exceed the

‘imminent’ timeframe applicable in a threat of injury analysis in original investigations.”43

Although the standard in a five-year review is not the same as the standard applied in an original

antidumping duty investigation, it contains some of the same fundamental elements. The statute provides

that the Commission is to “consider the likely volume, price effect, and impact of imports of the subject

merchandise on the industry if the orders are revoked or the suspended investigation is terminated.”44 It

directs the Commission to take into account its prior injury determination, whether any improvement in

the state of the industry is related to the order or the suspension agreement under review, whether the

industry is vulnerable to material injury if the orders are revoked or the suspension agreement is

terminated, and any findings by Commerce regarding duty absorption pursuant to 19 U.S.C. §

1675(a)(4).45

No respondent interested parties participated in this expedited review. The record, therefore,

contains limited new information with respect to the cased pencil industry in China, as well as limited

information on the cased pencil market during the period of review. Accordingly, for our determination,

 39 See NMB Singapore Ltd. v. United States, 288 F. Supp. 2d 1306, 1352 (Ct. Int’l Trade 2003) (“‘likely’ means

probable within the context of 19 U.S.C. § 1675(c) and 19 U.S.C. § 1675a(a)”), aff’d mem., 140 Fed. Appx. 268

(Fed. Cir. 2005); Nippon Steel Corp. v. United States, 26 CIT 1416, 1419 (2002) (same); Usinor Industeel, S.A. v.

United States, 26 CIT 1402, 1404 nn.3, 6 (2002) (“more likely than not” standard is “consistent with the court’s

opinion”; “the court has not interpreted ‘likely’ to imply any particular degree of ‘certainty’”); Indorama Chemicals

(Thailand) Ltd. v. United States, Slip Op. 02-105 at 20 (Ct. Int’l Trade Sept. 4, 2002) (“standard is based on a

likelihood of continuation or recurrence of injury, not a certainty”); Usinor v. United States, 26 CIT 767, 794 (2002)

(“‘likely’ is tantamount to ‘probable,’ not merely ‘possible’”).

 40 For a complete statement of Chairman Okun’s interpretation of the likely standard, see Additional Views of

Vice Chairman Deanna Tanner Okun Concerning the “Likely” Standard in Certain Seamless Carbon and Alloy Steel

Standard, Line and Pressure Pipe From Argentina, Brazil, Germany, and Italy, Invs. Nos. 701-TA-362 (Review) and

731-TA-707 to 710 (Review) (Remand), USITC Pub. 3754 (Feb. 2005).

 41 Commissioner Lane notes that, consistent with her views in Pressure Sensitive Plastic Tape From Italy, Inv.

No. AA1921-167 (Second Review), USITC Pub. 3698 (June 2004), she does not concur with the U.S. Court of

International Trade’s interpretation of “likely,” but she will apply the Court’s standard in these reviews and all

subsequent reviews until either Congress clarifies the meaning or the U.S. Court of Appeals for the Federal Circuit

addresses this issue.

 42 19 U.S.C. § 1675a(a)(5).

 43 SAA at 887. Among the factors that the Commission should consider in this regard are “the fungibility or

differentiation within the product in question, the level of substitutability between the imported and domestic

products, the channels of distribution used, the methods of contracting (such as spot sales or long-term contracts),

and lead times for delivery of goods, as well as other factors that may only manifest themselves in the longer term,

such as planned investment and the shifting of production facilities.” Id.

 44 19 U.S.C. § 1675a(a)(1).

 45 19 U.S.C. § 1675a(a)(1). There have been no duty absorption findings by Commerce with respect to the order

under review. CR at I-7, PR at I-6. The statute further provides that the presence or absence of any factor that the

Commission is required to consider shall not necessarily give decisive guidance with respect to the Commission’s

determination. 19 U.S.C. § 1675a(a)(5). While the Commission must consider all factors, no one factor is

necessarily dispositive. SAA at 886.

10
we rely as appropriate on the facts available from the original investigation and prior reviews and the

limited new information on the record in this review.46 47

B. Conditions of Competition

In evaluating the likely impact of the subject imports on the domestic industry, the statute directs

the Commission to consider all relevant economic factors “within the context of the business cycle and

conditions of competition that are distinctive to the affected industry.”48

1. The Original Investigation and the Prior Reviews

The Commission observed in the original investigation and the first and second five-year reviews

that demand for cased pencils was seasonal and influenced by population levels, especially changes in the

number of school-age students. The Commission also noted that the market for cased pencils was mature,

and that no technological developments had occurred since the original investigation and none were likely

in the reasonably foreseeable future.49

The Commission noted in the first five-year review that the quantity of apparent U.S.

consumption had increased approximately *** percent between 1993, the final year of the original period

of investigation, and 1998, the final year of the first review period, from *** gross to *** gross.50 For the

second review period, apparent U.S. consumption in 2004 remained above the 1993 quantity, but declined

compared with the end of the first five-year review period to *** gross in 2004.51 

The Commission found that the domestic industry had consolidated in the original investigation.52

In the first five-year review, the Commission noted that the consolidation had continued: while there

were 11 domestic producers at the time of the original investigation, there were between seven and nine in

 46 19 U.S.C. § 1677e(a) authorizes the Commission to “use the facts otherwise available” in reaching a

determination when (1) necessary information is not available on the record or (2) an interested party or other person

withholds information requested by the agency, fails to provide such information in the time, form, or manner

requested, significantly impedes a proceeding, or provides information that cannot be verified pursuant to section

782(i) of the Act. 19 U.S.C. § 1677e(a). The verification requirements in section 782(i) are applicable only to

Commerce. 19 U.S.C. § 1677m(i). See Titanium Metals Corp. v. United States, 155 F. Supp. 2d 750, 765 (Ct. Int’l

Trade 2001) (“[T]he ITC correctly responds that Congress has not required the Commission to conduct verification

procedures for the evidence before it, or provided a minimum standard by which to measure the thoroughness of a

Commission investigation.”).

 47 Chairman Okun notes that the statute authorizes the Commission to take adverse inferences in five-year

reviews, but such authorization does not relieve the Commission of its obligation to consider the record evidence as

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

the participating parties and certified by them as true, but bases her decision on the evidence as a whole, and does

not automatically accept participating parties’ suggested interpretations of the record evidence. Regardless of the

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

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

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

industry as a whole and by drawing reasonable inferences from the evidence it finds most persuasive.” SAA at 869.

 48 19 U.S.C. § 1675a(a)(4).

 49 First Five-Year Review Determination at 8; Second Five-Year Review Determination at 9.

 50 First Five-Year Review Determination at 8; CR/PR at Table I-9.

 51 Second Five-Year Review Determination at 9.

 52 Original Determination at I-10.

11
the first review period.53 In the second five-year review, the Commission identified nine domestic

producers of cased pencils.54 

In the original investigation, the Commission recognized the importance of price in purchasing

decisions. Two Commissioners characterized the market for cased pencils as price sensitive.55 Two other

Commissioners observed that there was a shift in the office supply market from small, regional

distributors to nationwide catalog wholesalers and superstores. They observed that the large, nationwide

purchasers were increasingly making their purchasing decisions on the basis of price rather than non-price

factors.56 In the first and second review periods, the Commission found that price remained the principal

determinant in making a sale.57

In the first and second reviews, the Commission noted that the quantity and market share of cased

pencils from China increased since the original investigation notwithstanding the order. Imports of cased

pencils from China were 4.7 million gross in 1993, accounting for *** percent of apparent U.S.

consumption, then increased in absolute terms to 6.0 million gross in 1998, accounting for *** percent of

apparent U.S. consumption. Subject imports then increased to 9.2 million gross in 2004, accounting for

*** percent of apparent U.S. consumption in 2004.58

The quantity and market share of nonsubject imports were also found to have increased since the

original investigation. In 1993, there were 2.0 million gross units of imports from nonsubject countries,

accounting for *** percent of apparent U.S. consumption. In 1998, 8.9 million gross units were imported

from nonsubject countries, accounting for *** percent of apparent U.S. consumption. In 2004, there were

9.0 million gross units of imports from nonsubject countries, accounting for *** percent of apparent U.S.

consumption.59

2. The Current Review

In this review, we find the following conditions of competition relevant to our analysis.

The conditions of competition relied upon by the Commission in making its determinations in the

second five-year reviews generally continued in the current period. The record indicates that competition

for cased pencils remains centered principally on price as manufacturers fight for a share of a mature

market with limited opportunities for extensive growth.60 The record also indicates that a large share of

cased pencil sales are being made to a few large customers, and as large stationary firms and mass market

merchandisers have consolidated their dominance in the U.S. market, there are fewer large purchasers of

cased pencils with greater negotiating power.61

 53 First Five-Year Review Determination at 8.

 54 Second Five-Year Review Determination at 5. 

 55 Original Determination at I-22 (“Views of Commissioners Rohr and Newquist”).

 56 Original Determination at I-17 (“Views of Chairman Watson and Commissioner Bragg”).

 57 First Five-Year Review Determination at 11; Second Five-Year Review Determination at 13.

 58 Second Five-Year Review Determination at 9-10.

 59 First Five-Year Review Determination at 9; Second Five Year Review Determination at 10.

 60 CR at I-22, I-39, PR at I-18, I-28.

 61 Response of Dixon Ticonderoga, December 1, 2010, p. 11; and Response of General Pencil, Musgrave Pencil,

and Sanford, December 1, 2010, pp. 8 & 12.

12
Demand for cased pencils in the U.S. market is reportedly derived from population growth,

principally among school-age children.62 Apparent U.S. consumption increased by *** percent, from ***

gross in 2004 to *** gross in 2009.63

The U.S. cased pencils market is supplied by domestic producers, subject imports, and nonsubject

imports. The limited record in this review suggests that the domestic industry continues to consolidate,

with eight firms currently producing cased pencils in the United States compared with 11 U.S. producers

in the original investigation.64 Since the Commission’s second five-year review, domestic producer

Tennessee Pencil ceased production of pencils, and ***.65

The domestic industry’s share of apparent U.S. consumption has continued to decline and has

reached its lowest point during this review: it was *** percent in 1993, *** percent in 1998, *** percent

in 2004, and *** percent in 2009.66 Subject imports maintained a significant presence in the U.S. market

during the period examined. The market share held by subject imports from China has increased since the

original investigation to its highest level in 2009, accounting for *** percent of apparent U.S.

consumption in 2009.67 The market share held by nonsubject imports has increased since the original

investigation to its highest level in 2009, accounting for *** percent of apparent U.S. consumption.68 The

top five nonsubject country sources of cased pencils in 2009 – Indonesia, Taiwan, Brazil, Costa Rica, and

Vietnam – accounted for the *** of nonsubject imports volume that year.69

In the face of large volumes of Chinese imports in the commodity pencil segment, domestic

producers have concentrated their efforts in the specialty and custom pencil market.70 Since the last

review, however, Internet-based suppliers of Chinese pencils have become more widespread, which has

allowed Chinese producers to participate more fully in the specialty pencil market. The record also

indicates that the price for the largest raw material input in pencil production, wooden slats typically

made with cedar or basswood, has increased dramatically over this review period.71 

Based on the limited record evidence, we find that the conditions of competition in the cased

pencils market are not likely to change significantly in the reasonably foreseeable future. We find that

these conditions of competition provide us with a reasonable basis on which to assess the likely effects of

revocation. 

C. Likely Volume of Subject Imports

In evaluating the likely volume of imports of subject merchandise if an antidumping duty order is

revoked, the Commission is directed to consider whether the likely volume of imports would be

 62 CR at I-39, PR at I-28.

 63 CR/PR at Table I-9. Apparent U.S. consumption was *** gross in 1998 and *** gross in 1993. 

 64 CR at I-24-25, PR at I-19-20. There may be other domestic producers. CR at I-25, n.61, PR at I-20, n.61

 65 CR at I-25, PR at I-20.

 66 CR/PR at Table I-9 (2009 market share calculated from Tables I-4 and I-9). In 2009, Dixon Ticonderoga’s

market share for shipments of its U.S. produced product was *** percent. See CR/PR Tables I-4 & I-9.

 67 CR/PR at Table I-9.

 68 CR/PR at Table I-9. 

 69 CR/PR at Table I-8.

 70 Response of Sanford, General Pencil, and Musgrave Pencil, December 1, 2010, at 4.

 71 Response of Dixon Ticonderoga, December 1, 2010, at 12.

13
significant either in absolute terms or relative to production or consumption in the United States.72 In

doing so, the Commission must consider “all relevant economic factors,” including four enumerated

factors: (1) any likely increase in production capacity or existing unused production capacity in the

exporting country; (2) existing inventories of the subject merchandise, or likely increases in inventories;

(3) the existence of barriers to the importation of the subject merchandise into countries other than the

United States; and (4) the potential for product shifting if production facilities in the foreign country,

which can be used to produce the subject merchandise, are currently being used to produce other

products.73

1. The Original Investigation

In the original investigation the Commission noted that the volume of subject imports increased

rapidly over the period of investigation, and that increases in imports of noncommodity, decorated

pencils, which the domestic industry traditionally had been able to sell at a higher price, were particularly

rapid.74 The Commission found that exports to the United States as a share of Chinese producers’ total

shipments had increased over the period of investigation while Chinese domestic shipments had

decreased as a share of total shipments. It found that these trends indicated that imports from China

would be increasingly directed to the U.S. market and that the rapid increase of imports from China posed

a threat of material injury to the domestic industry.75 

2. The Prior Reviews

The record in the first five-year review further indicated that the number of producers of cased

pencils in China had increased since the time of the original investigation. Because of this increase, and

the lack of information indicating any reduction in the capacity of Chinese producers that existed at the

time of the original investigation, the Commission concluded that the capacity to produce cased pencils in

China had likely risen since the time of the original investigation. The Commission found this conclusion

to be corroborated by information in the record showing that Chinese exports of cased pencils to all

countries had risen considerably since 1993, suggesting that capacity had indeed increased.76 In light of

the Chinese industry’s capacity increases, the significant increase in its exports since the order, and its

historic ability to rapidly increase exports to the United States, the Commission found that upon

revocation of the order, producers of subject merchandise in China would increase exports to the United

States above existing high levels. The Commission consequently concluded that the likely volume of

subject imports would be significant if the antidumping duty order was revoked.77

In the second five-year review, the domestic interested parties identified 19 Chinese producers

and 19 Chinese exporters of pencils. According to a private market intelligence report, there were

approximately 400 producers of cased pencils in China during 2003.78 The level of subject imports in

2004 (9.2 million gross) exceeded the domestic producers’ shipments (*** gross). The Commission

found that subject imports’ share of the U.S. market already exceeded the market share of the domestic

 72 19 U.S.C. § 1675a(a)(2).

 73 19 U.S.C. § 1675a(a)(2)(A-D).

 74 Original Determination at I-16, I-26.

 75 Original Determination at I-16-I-17.

 76 First Five-Year Review Determination at 10.

 77 First Five-Year Review Determination at 10-11.

 78 Second Five-Year Review Determination at 12.

14
industry and would be likely to increase even further if the order were revoked.79 Accordingly, the

Commission found that the likely volume of subject imports would be significant, both in absolute and

relative terms.80

3. The Current Review

Several factors support the conclusion that subject import volume is likely to be significant in the

event of revocation of the order. Notwithstanding the antidumping duty order, subject imports from

China have continued to enter the U.S. market in substantial quantities and have increased from 9.2

million gross in 2004 to 10.5 million gross in 2009.81 The record indicates that the volume of subject

imports was more than *** the combined 2009 U.S. production of General Pencil, Musgrave Pencil, and

Sanford; these three producers accounted for approximately *** percent of U.S. production.82 Subject

imports’ market share by quantity was at its peak level over the periods investigated in 2009 at ***

percent, greater than their *** percent market share in 2004, and *** the market share from the original

investigation.83 Thus, it is evident that cased pencils from China have a firm foothold in the U.S. market

and Chinese exporters have been able to increase their exports to the United States even with the

antidumping duty order in place.

Because of the lack of participation by Chinese producers and importers of subject merchandise,

the Commission has limited information on the foreign industry in this review. In the last review, it was

reported that there were approximately 400 producers of cased pencils in China during 2003, and

domestic producers have indicated that there is no information indicating that the total number of

producers in China has decreased from this figure.84 Moreover, Dixon Ticonderoga listed 74 Chinese

exporters of pencils in its response to the Commission in the current review.85 

Domestic producers note that the capacity to produce cased pencils in China was at least 104

million gross in 2010, an increase of 36.8 percent from the 76 million gross capacity reported in the

previous period of review.86 Domestic producers also assert that the Chinese industry has an inventory of

35 million gross cased pencils available for export, which *** the *** gross total consumption in the U.S.

market in 2009.87

The record indicates that China exports a significant percentage of its domestic production of

cased pencils. In 2009, approximately 28 percent of China’s production of cased pencils was exported.88

Based on Global Trade Atlas data, China is, by far, the world’s largest exporter of cased pencils,

 79 Id.

 80 Id.

 81 CR/PR at Table I-9. The record indicates that subject imports have more than doubled since the original

investigation.

 82 Response of Sanford, General Pencil, and Musgrave Pencil, April 21, 2011, at 7.

 83 CR/PR at Table I-9.

 84 CR at I-43, PR at I-31.

 85 Response of Dixon Ticonderoga, December 1, 2010, at 8 and Ex. 2.

 86 CR at I-44; PR at I-32.

 87 Response of Dixon Ticonderoga, April 21, 2011, at 9-10.

 88 CR/PR at Table I-10.

15
representing more than one-third of total world exports, in terms of value, in 2009.89 According to

official Chinese export statistics, from 2005 to 2009, the quantity of China’s total exports of cased pencils

increased by 11.5 percent, rising from 38.8 million gross to 43.3 million gross.90 The United States was

consistently China’s largest export market for cased pencils, accounting for 25.1 percent of China’s

exports in 2009.91 

Moreover, in 2009 the average unit values (“AUVs “) of Chinese exports to the U.S. market were

higher than the AUVs to any other Chinese export market, other than Korea, Germany, and Canada,

which collectively accounted for only 5.7 percent of Chinese exports.92 These higher AUVs make the

United States an attractive export market for Chinese cased pencil producers, and would provide further

incentive for these producers to increase exports to the United States. 

Antidumping duty measures are currently in place in Turkey with respect to “pencils with leads

of graphite and crayons encased in a rigid sheath” produced in China.93 In 1994, Mexico imposed an

antidumping duty on imports of pencils from China, but effective October 15, 2008, Mexico’s

antidumping duty was rescinded and replaced with a transitional duty, which was to be phased out over a

three-year period.94 

Based on the large and increasing presence of subject imports in the U.S. market, the size of the

industry in China, and the Chinese industry’s total volume of exports and continued focus on the

attractive U.S. market, we find that Chinese producers would likely increase their exports to the United

States above their already significant level if the antidumping duty order was revoked. Thus, we find that

the likely volume of subject imports, both in absolute terms and as a share of the U.S. market, would be

significant if the order was revoked.

D. Likely Price Effects of Subject Imports

In evaluating the likely price effects of subject imports if the antidumping duty order is revoked,

the Commission is directed to consider whether there is likely to be significant underselling by the subject

imports as compared to the domestic like product and whether the subject imports are likely to enter the

United States at prices that otherwise would have a significant depressing or suppressing effect on the

price of the domestic like product.95

 89 CR/PR at Table I-12. We have used value data here because different countries measured pencil quantity in

different ways. 

 90 CR/PR at Table I-11.

 91 CR/PR at Table I-11. According to domestic producers, the increase in Internet buying and selling of cased

pencils, particularly marked in the specialty and custom segment, where U.S. production is increasingly

concentrated, makes it much easier for a seller of subject imports to find a U.S. buyer. Response of General Pencil,

Musgrave Pencil, and Sanford, April 21, 2011, p. 4.

 92 CR/PR at Table I-11.

 93 CR at I-41, PR at I-30. 

 94 CR at I-39, PR at I-30.

 95 19 U.S.C. § 1675a(a)(3). The SAA states that “[c]onsistent with its practice in investigations, in considering

the likely price effects of imports in the event of revocation and termination, the Commission may rely on

circumstantial, as well as direct, evidence of the adverse effects of unfairly traded imports on domestic prices.” SAA

at 886.

16
1. The Original Determination

In the original determination, the Commission found that the subject imports undersold

domestically produced cased pencils in the vast majority of pricing comparisons and that there was a

significant likelihood the subject imports would have a depressing or suppressing effect on prices for the

domestic like product. Subject import prices were declining for those products where competition with

the domestic like product was most intense.96 

2. The Prior Reviews

In the first five-year review, because current pricing information was limited to data on AUVs

between 1997 and 1999, the Commission relied on the indication of current underselling shown by those

data notwithstanding their limitations.97 The Commission concluded in that review that, if the

antidumping duty order was revoked, prices for the subject imports would decline significantly. The

Commission noted that the record suggested that the cased pencils market was price-sensitive and that

there was a high degree of substitutability between the subject and domestic merchandise. Moreover, the

pricing patterns of the subject imports in the review period and during the original investigation indicated

that there was likely to be significant underselling by the subject imports. The Commission observed, in

light of the growing concentration and consolidation of purchasers, which increasingly were nationwide

catalog wholesalers and superstores that made purchasing decisions on the basis of price, that increased

volumes of low-priced subject imports would likely depress prices for domestically produced cased

pencils. Consequently, the Commission found that, if the antidumping duty order were to be revoked, the

subject imports would likely have significant price depressing or suppressing effects.98

In the second five-year review, the Commission found that price remained a principal

determining factor in making a sale of cased pencils.99 While the Commission noted that it was mindful

of possible product mix issues, the record of that review indicated that the AUVs of the subject imports

continued to be considerably lower than the AUVs of the U.S. producers’ U.S. shipments.100 The

Commission found that, if the order were to be revoked, the subject imports would likely undersell the

U.S. product in order to gain even more U.S. market share, forcing U.S. producers to lower their prices to

avoid further declines in their production and shipment levels.101 The Commission therefore concluded

that, if the order was revoked, the likely significant increase in subject import volume at prices that would

likely undersell the U.S. product would likely have significant adverse price effects on U.S. producers.102

 96 First Five-Year Review Determination at 11.

 97 The Commission, acknowledging that AUVs can be affected by variations in product mix, observed that AUVs

of all cased pencils imported from China (including those that were at that time nonsubject imports) increased from

$3.82 per gross in 1994 to $5.59 per gross in 1995, the first full year after issuance of the antidumping duty order. 

Since then, AUVs for imports from China fluctuated at lower levels. In 1998, the AUVs for cased pencil imports

from China was $4.81 per gross, which was considerably above pre-order levels, but well below the AUVs for the

domestic like product, which was valued at *** per gross. First Five-Year Review Determination at 11.

 98 First Five-Year Review Determination at 11-12.

 99 Second Five-Year Review Determination at 13.

 100 Id.

 101 Id.

 102 Id.

17
3. The Current Review

There is no new product-specific pricing information on the record of this review. As noted

above, price remains a principal determinant in making a sale as manufacturers compete for a share of this

mature market.103 Although we continue to be mindful of possible product mix issues, the record of this

review indicates that the AUVs of the subject imports were $5.53 per gross in 2009 compared with the

AUVs of the U.S. producers’ U.S. shipments, which were $*** per gross.104 We note that the increase in

subject import AUVs may simply reflect the restraining effects of the order and variations in product mix. 

Moreover, as subject import volumes have more than doubled since the original investigation, the AUVs

of the U.S. producers’ U.S. shipments have fallen ***.105

The record also indicates that since the imposition of the order, export AUVs of cased pencils

from China to the United States have risen significantly above the average AUVs of Chinese cased pencil

exports to the rest of the world.106 In 2009 and in the first nine months of 2010, the AUVs of Chinese

exports to the United States have been between 18 to 21 percent above the average export prices to the

rest of the world, and well over 21 percent above those for Taiwan and the U.K., the second and third

largest Chinese export markets.107 The record thus demonstrates that while the order has not restrained all

Chinese exports, it appears to have placed some price discipline on those exports.

We find it likely that subject foreign producers would resume their pattern of underselling from

the original investigation if the order were revoked in order to further increase their share of this pricesensitive market. In response, domestic producers would have to either reduce their prices or relinquish

market share. Accordingly, we find that, if the order were revoked, the likely significant increase in

subject import volume at prices that would likely undersell the domestic like product would likely have

significant adverse price effects on the domestic industry.

E. Likely Impact of Subject Imports108

In evaluating the likely impact of imports of subject merchandise if the antidumping duty orders

under review were revoked, the Commission is directed to consider all relevant economic factors that are

likely to have a bearing on the state of the industry in the United States, including, but not limited, to the

following: (1) likely declines in output, sales, market share, profits, productivity, return on investments,

and utilization of capacity; (2) likely negative effects on cash flow, inventories, employment, wages,

 103 CR at I-13, PR at I-8.

 104 CR/PR at Tables I-4, I-5, I-8. We note that the large range of reported AUVs for the domestic producers

suggests that there are significant product mix differences among them. CR/PR at Table I-4 (AUVs for General

Pencil of $*** per gross, for Musgrave Pencil of $*** per gross, and for Sanford of $*** per gross).

 105 CR/PR at Tables I-4, I-5 (showing that in 1993 the AUVs of U.S. producers’ U.S. shipments were $*** per

gross).

 106 Response of Dixon Ticonderoga, April 21, 2011, at 13.

 107 Id. at 13-14. 

 108 Section 752(a)(6) of the Act states that “the Commission may consider the magnitude of the margin of

dumping” in making its determination in a five-year review. 19 U.S.C. § 1675a(a)(6). The statute defines the

“magnitude of the margin of dumping” to be used by the Commission in five-year reviews as “the dumping margin

or margins determined by the administering authority under section 1675a(c)(3) of this title.” 19 U.S.C.

§ 1677(35)(C)(iv). See also SAA at 887. In the final results of its expedited review of the antidumping duty order

on cased pencils from China, Commerce found likely dumping margins of 8.60 percent for China First Pencil Co.,

Ltd; 19.36 percent for Shanghai Lansheng Corp; 11.15 percent for Shanghai Foreign Trade Corp; and 53.65 percent

for Guangdong Provincial Stationery & Sporting Goods Import & Export Corp., and 53.65 percent for China-wide

rate. 76 Fed. Reg. 12323 (March 7, 2011). 

18
growth, ability to raise capital, and investment; and (3) likely negative effects on the existing

development and production efforts of the industry, including efforts to develop a derivative or more

advanced version of the domestic like product.109 All relevant economic factors are to be considered

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

industry.110 As instructed by the statute, we have considered the extent to which any improvement in the

state of the domestic industry is related to the orders at issue and whether the industry is vulnerable to

material injury if the orders were revoked.

1. The Original Determination

In the original determination the Commission found that the U.S. cased pencil industry was

threatened with material injury by reason of the subject imports, based on the domestic industry’s

declining market share, capacity utilization, and employment and the domestic industry’s operating losses

experienced throughout the period of investigation.111 The Commission found that increased volumes of

subject imports would lead to price declines for the domestic like product and would prevent domestic

producers from recovering cost increases. As a result, the Commission concluded that the domestic

industry’s financial performance would likely deteriorate.112

2. The Prior Reviews

In the first five-year review, the Commission noted that the order had had a positive effect on the

industry’s performance. The Commission found that the industry was not vulnerable in light of its current 

profitability and the increase in AUVs for domestically produced pencils since the original investigation. 

The Commission then referred to its findings that revocation of the order likely would result in a

significant increase in the volume of subject imports at prices significantly lower than those of the

domestic like product, and that such increased volumes of subject imports would likely depress or

suppress the domestic industry’s prices significantly. The Commission observed that, because a reduction

in prices would not stimulate significant additional demand, revocation would likely have a significant

adverse impact on the production, shipment, sales, and revenue levels of the domestic industry. These

declines would in turn have a direct adverse impact on the industry’s employment, profitability, and

ability to raise capital and make and maintain necessary capital investments. Accordingly, based on the

limited record in that review, the Commission concluded that, if the antidumping duty order were

revoked, subject imports would be likely to have a significant adverse impact on the domestic industry

within a reasonably foreseeable time.113

In the second five-year review, the Commission noted that the record did not include current

financial information on the U.S. industry or otherwise permit it to assess whether the industry was

currently vulnerable. The record did show, however, that the U.S. industry’s production and U.S.

shipments declined substantially since the first review. Its production decreased from *** gross in 1998

to *** gross in 2004, and its U.S. shipments decreased from *** gross in 1998 to *** gross in 2004.114

The Commission found that subject import volume was likely to be significant if the order is revoked,

resulting in likely significant price effects. The Commission concluded that revocation of the

 109 19 U.S.C. § 1675a(a)(4).

 110 19 U.S.C. § 1675a(a)(4).

 111 Original Determination at I-9 - I-12.

 112 Original Determination at I-17-I-18, I-27-I-28.

 113 First Five-Year Review Determination at 12-13.

 114 Second Five-Year Review Determination at 13-14.

19
antidumping duty order would be likely to lead to significant declines in output, sales, market share,

profits, productivity, return on investments, and utilization of capacity; likely negative effects on cash

flow, inventories, employment, wages, growth, ability to raise capital, and investment; and negative

effects on the domestic industry’s development and production efforts within a reasonably foreseeable

time.115

3. The Current Review

In these expedited reviews, the record information on the domestic industry’s condition is limited. 

We collected 2009 data for several performance indicators, but no data from 2005 to 2008. The limited

evidence in this expedited review is insufficient for us to make a finding on whether the domestic industry

is vulnerable to the continuation or recurrence of material injury in the event of revocation of the order.116

The data show that, compared with the last review, the domestic industry has become smaller and

virtually all of its performance indicators are significantly lower. In 2009, the domestic industry’s

capacity was *** gross, its production was *** gross, and its rate of capacity utilization was ***

percent.117 The domestic industry’s U.S. shipments were *** gross, accounting for *** percent of

apparent U.S. consumption.118 All of these indicators are lower than in the last review. 

Although comparisons with the last two reviews were not available, the domestic industry’s

operating ***, and operating margins of *** percent, were both lower than in the original investigation.119

We have also considered the role of factors other than the subject imports so as not to attribute

injury from such factors to subject imports. The share of the U.S. market held by nonsubject imports has

continued to increase since the last review; it was *** percent in 2004 and *** percent in 2009.120 We

nevertheless find that a significant portion of the expected increase in subject imports would continue to

be at the expense of the domestic industry given the likelihood of subject import underselling and adverse

price effects. 

We recognize that the United States suffered from an economic downturn in 2009. Apparent U.S.

consumption for cased pencils, however, increased by *** percent from 2004 to 2009, indicating that

demand for cased pencils did not deteriorate significantly in the economic downturn.121 We find that any

lingering effects of the economic downturn are not likely to sever the causal nexus between subject

imports and their likely significant adverse impact on the domestic industry if the order were revoked.

Based on the record of this review, we find that the likely volume and price effects of the subject

imports, should the order be revoked, would likely have a significant adverse impact on the production,

shipments, sales, market share, and revenues of the domestic industry. Declines in these indicators of

industry performance would have a direct adverse impact on the industry’s profitability and employment,

 115 Second Five-Year Review Determination at 14.

 116 Commissioner Lane and Commissioner Pinkert conclude, based on the record evidence, that the domestic

industry producing cased pencils is vulnerable. Capacity, capacity utilization, production, and U.S. shipments were

lower for the domestic industry in 2009 than in the last review, as noted in the text. It is also significant that the

domestic industry’s market share has fallen sharply since the original investigation *** and that the domestic

industry experienced *** and *** in 2009. 

 117 CR/PR at Table I-5 (as calculated from Table I-4).

 118 CR/PR at Table I-9.

 119 CR/PR at Table I-5.

 120 CR/PR at Table I-9. The share of the U.S. market held by nonsubject imports was *** percent in 1993 and

*** percent in 1998. CR/PR at Table I-9.

 121 CR/PR at Table I-9.

20
as well as its ability to raise capital, to make and maintain capital investments, and to fund research and

development.

Accordingly, we conclude that, if the antidumping duty order were revoked, subject imports from

China would likely have a significant adverse impact on the domestic industry within a reasonably

foreseeable time.

CONCLUSION

For the foregoing reasons, we determine that revocation of the antidumping duty order on cased

pencils from China would be likely to lead to continuation or recurrence of material injury to an industry

in the United States within a reasonably foreseeable time.

21

INFORMATION OBTAINED IN THE REVIEW

I-1

INTRODUCTION

Background

On November 1, 2010, in accordance with section 751(c) of the Tariff Act of 1930, as amended

(“the Act”),1

 the U.S. International Trade Commission (“Commission” or “USITC”) gave notice that it

had instituted a review to determine whether revocation of the antidumping duty order on cased pencils

from China would be likely to lead to a continuation or recurrence of material injury within a reasonably

foreseeable time.2 3

 On February 4, 2011, the Commission determined that the domestic interested party

group response to its notice of institution was adequate4

 and that the respondent interested party group

response was inadequate.5

 In the absence of respondent interested party responses and any other

circumstances that would warrant the conduct of a full review, the Commission determined to conduct an

expedited review of the antidumping duty order pursuant to section 751(c)(3) of the Act (19 U.S.C. §

1675(c)(3)).6

 The Commission voted on this review on June 13, 2011. The Commission notified

Commerce of its determination on June 24, 2011. The following tabulation presents selected information

relating to the schedule of this five-year review.7

Effective date Action

Federal Register

citation

November 1, 2010 Commission’s institution of five-year review

75 FR 67102 

November 1, 2010

November 1, 2010 Commerce’s initiation of five-year review

75 FR 67082

November 1, 2010

February 4, 2011 Commission’s determination to conduct an expedited five-year review

76 FR 11267

March 1, 2011

March 7, 2011 Commerce’s final expedited five-year review determination

76 FR 12323

March 7, 2011

June 13, 2011 Commission’s vote Not applicable

June 24, 2011 Commission’s determination transmitted to Commerce Not applicable

 1 19 U.S.C. 1675(c).

 2 Cased Pencils From China, 75 FR 67102, November 1, 2010. All interested parties were requested to respond

to this notice by submitting the information requested by the Commission. The Commission’s notice of institution is

presented in app. A.

 3

 In accordance with section 751(c) of the Act, the U.S. Department of Commerce (“Commerce”) published a

notice of initiation of a five-year review of the subject antidumping duty order concurrently with the Commission’s

notice of institution. Initiation of Five-Year (“Sunset”) Review, 75 FR 67082, November 1, 2010.

 4

 The Commission received two submissions in response to its notice of institution in the subject review. One

was filed on behalf of Dixon Ticonderoga Co. (“Dixon Ticonderoga”) and the other was filed on behalf of Sanford,

L.P. (“Sanford”), General Pencil Co., Inc. (“General Pencil”), and Musgrave Pencil Co. (“Musgrave Pencil”),

domestic producers of cased pencils. The domestic interested parties reported that together they accounted for

approximately 88 percent of total U.S. production of cased pencils in 2009. Response of Sanford, General Pencil,

and Musgrave Pencil, December 1, 2010, p. 10.

 5

 The Commission did not receive a response from any respondent interested parties to its notice of institution.

 6 Cased Pencils from China, 76 FR 11267, March 1, 2011. The Commission’s notice of an expedited review

appears in app. A. The Commission’s statement on adequacy is presented in app. B.

 7

 Cited Federal Register notices beginning with the Commission’s institution of a five-year sunset review are

presented in app. A.

I-3
The Original Investigation and Subsequent Five-Year Reviews

On November 10, 1993, a petition was filed with Commerce and the Commission alleging that an

industry in the United States was materially injured and threatened with further material injury by reason

of less-than-fair-value (“LTFV”) imports of cased pencils from China.8 9

 The petition was subsequently

amended to include an allegation of critical circumstances with respect to imports of the subject

merchandise from China. On November 8, 1994, Commerce made an affirmative final LTFV

determination10 and, on December 15, 1994, the Commission completed its original investigation,

determining that an industry in the United States was materially injured by reason of LTFV imports of

cased pencils from China.11 Following receipt of the Commission’s final affirmative determination,

Commerce issued an antidumping duty order on imports of cased pencils from China.12 Effective 

May 11, 1999, Commerce amended its antidumping duty order (and final LTFV determination) following

the Federal Circuit’s affirmation of the CIT’s affirmation of Commerce’s voluntary remand

determination.13 Commerce’s original and amended final dumping margins are presented in table I-1.

 8 The petition was filed on behalf of the Pencil Makers Association, Inc. (“PMA”), and the individual companies

comprising its membership (eight domestic manufacturers of cased pencils and one domestic manufacturer of

cosmetic pencils). On January 1, 1994, the PMA merged with the Writing Instrument Manufacturers Association

(“WIMA”), and the former PMA members formed the Pencil Section of the WIMA. Certain Cased Pencils From

the People’s Republic of China: Investigation No. 731-TA-669 (Final), USITC Publication 2837, December 1994, 

p. II-3; and Cased Pencils From China: Investigation No. 731-TA-669 (Second Review), USITC Publication 3820,

November 2005, p. I-2.

 9

 The original petition also included an allegation concerning LTFV imports of cased pencils from Thailand. 

However, the Commission made a final negative determination of injury in the investigation concerning Thailand on

October 5, 1994. Certain Cased Pencils From the People’s Republic of China: Investigation No. 731-TA-669

(Final), USITC Publication 2837, December 1994, p. II-3.

 10 Commerce made affirmative critical circumstances findings with respect to subject imports from Shanghai

Foreign Trade Corp., Shanghai Lansheng Corp., and all other Chinese pencil manufacturers which were found to be

dumping and which did not respond to Commerce’s questionnaires. Because it found imports from China First

Pencil Co. and Guangdong Provincial Stationery & Sporting Goods Import & Export Corp. to not be dumped,

Commerce did not make a critical circumstances determination with respect to these companies. Notice of Final

Determination of Sales at Less Than Fair Value: Certain Cased Pencils From the People’s Republic of China, 59

FR 55625, November 8, 1994.

 11 The Commission made affirmative critical circumstances determinations with regard to LTFV imports from

Shanghai Foreign Trade Corp., Shanghai Lansheng Corp., and all other Chinese pencil manufacturers. Certain

Cased Pencils From the People’s Republic of China: Investigation No. 731-TA-669 (Final), USITC Publication

2837, December 1994, p. I-24.

 12 Antidumping Duty Order: Certain Cased Pencils from the People’s Republic of China, 59 FR 66909,

December 28, 1994.

 13 Effective November 23, 1997, Customs began suspending liquidation of subject merchandise produced and

exported by China First, pending final and conclusive court decision in the action and Commerce’s amendment for

the final LTFV determination and the antidumping duty order. Notice of Court Decision: Certain Cased Pencils

From the People’s Republic of China, 62 FR 65243, December 11, 1997; and Certain Cased Pencils From the

People’s Republic of China; Notice of Amended Final Determination of Sales at Less Than Fair Value and Amended

Antidumping Duty Order in Accordance With Final Court Decision, 64 FR 25275, May 11, 1999.

I-4
Table I-1

Cased pencils: Commerce’s original and amended final dumping margins

Exporter/producer

Final weighted

average margin

(in percent)

Final weighted

average margin,

as amended 

(in percent)

China First Pencil Co. (“China First”)/China First 0.00 8.60

China First/all other producers 44.66 53.65

Shanghai Lansheng Corp. (“Lansheng”) 17.45 19.36

Shanghai Foreign Trade Corp. (“SFTC”) 8.31 11.15

Guangdong Provincial Stationery & Sporting Goods Import &

Export Corp. (“Guangdong”)/Shanghai Three Star Stationery

Industry Corp. (“Three Star”) 0.00 0.00

Guangdong/all other producers 44.66 53.65

PRC-wide 44.66 53.65

Source: Notice of Final Determination of Sales at Less Than Fair Value: Certain Cased Pencils From the

People's Republic of China, 59 FR 55625, November 8, 1994; Notice of Court Decision: Certain Cased Pencils

From the People’s Republic of China, 62 FR 65243, December 11, 1997; and Certain Cased Pencils From the

People’s Republic of China; Notice of Amended Final Determination of Sales at Less Than Fair Value and

Amended Antidumping Duty Order in Accordance With Final Court Decision, 64 FR 25275, May 11, 1999.

The Commission instituted the first five-year review of the subject order on December 1, 1999,

and determined on March 3, 2000, that it would conduct an expedited review.14 On July 5, 2000,

Commerce published its determination that the revocation of the antidumping duty order on cased pencils

from China would be likely to lead to continuation or recurrence of dumping at the amended final

determination rates (see table I-1).15 The Commission determined that material injury would be likely to

continue or recur within a reasonably foreseeable time on July 24, 2000, and published its determination

on July 28, 2000.16 Commerce published notice of the first continuation of the antidumping duty order on

August 10, 2000.17

The Commission instituted the second five-year review of the subject order on July 5, 2005, and

determined on October 4, 2005, that it would conduct an expedited review.18 On November 7, 2005,

Commerce published its determination that revocation of the antidumping duty order on cased pencils

from China would be likely to lead to continuation or recurrence of dumping at the following weighted

average margins: China First/Three Star (8.60 percent), Lansheng (19.36 percent), SFTC (11.15 percent),

 14 Cased Pencils From China, 64 FR 67304, December 1, 1999; and Scheduling of an Expedited Five-Year

Review Concerning the Antidumping Duty Order on Cased Pencils From China, 65 FR 15007, March 20, 2000.

 15 Certain Cased Pencils From the People’s Republic of China; Final Results of Expedited Sunset Review of

Antidumping Duty Order, 65 FR 41431, July 5, 2000.

 16 Cased Pencils From China: Determination, 65 FR 46495, July 28, 2000.

 17 Continuation of Antidumping Duty Order: Cased Pencils From the People’s Republic of China, 65 FR 48960,

August 10, 2000.

 18 Cased Pencils From China, 70 FR 60557, October 18, 2005.

I-5
Guangdong (53.65 percent), and PRC-wide rate (53.65 percent).19 On November 30, 2005, the

Commission notified Commerce of its determination that material injury would be likely to continue or

recur within a reasonably foreseeable time20 and, on December 20, 2005, Commerce issued the second

continuation of the antidumping duty order.21

Commerce’s Final Result of Expedited Third Five-Year Review

Commerce published the final results of its expedited third five-year review on March 7, 2011. 

Commerce concluded that revocation of the antidumping duty order on cased pencils from China would

be likely to lead continuation or recurrence of dumping at the following weighted average margins: 

China First (8.60 percent), Three Star (0.00 percent), Lansheng (19.36 percent), SFTC (11.15 percent),

Guangdong (53.65 percent), and PRC-wide rate (53.65 percent).22

Commerce’s Administrative Reviews

Commerce has completed 12 administrative reviews of the antidumping duty order on cased

pencils from China. Commerce also initiated, but later rescinded, two new shipper reviews.23 There have

been 16 scope rulings, three changed circumstances determinations, and no duty absorption findings with

respect to cased pencils from China.24 Information on Commerce’s final determination, antidumping duty

order, administrative review determinations, and final results of its expedited third five-year review is

presented in table I-2.

 19 Commerce originally excluded from the order exports made by Guangdong and produced by Three Star. 

However, Commerce determined in its 1999-2000 administrative review that the Guangdong/Three Star sales chain

was no longer excluded from the order, and that all merchandise exported by Guangdong was subject to the cash

deposit requirements at the PRC-wide rate. Commerce also determined in its 1999-2000 administrative review that

China First and Three Star should be treated as a single entity. Certain Cased Pencils from the People’s Republic of

China; Notice of Final Results of Expedited Sunset Review of Antidumping Duty Order, 70 FR 67427, 

November 7, 2005.

 20 Cased Pencils From China, 70 FR 72652, December 6, 2005.

 21 Notice of Continuation of Antidumping Duty Order on Certain Cased Pencils from the People’s Republic of

China, 70 FR 75450, December 20, 2005.

 22 Certain Cased Pencils From the People’s Republic of China: Final Results of the Expedited Third Sunset

Review of the Antidumping Duty Order, 76 FR 12323, March 7, 2011.

 23 Certain Cased Pencils from the People’s Republic of China: Rescission of Antidumping Duty New Shipper

Review, 67 FR 11462, March 14, 2002; and Certain Cased Pencils from the People’s Republic of China: Rescission

of Antidumping Duty New Shipper Review, 68 FR 62427, November 4, 2003.

 24 Issues and Decision Memorandum for the Final Results of the Expedited Third Five-Year Sunset Review of the

Antidumping Duty Order on Certain Cased Pencils from the People’s Republic of China, March 1, 2011, pp. 3-4.

See the section of this report entitled “Scope” for information concerning Commerce’s scope rulings and changed

circumstances findings.

I-6
Table I-2

Cased pencils: Commerce’s final determination, antidumping duty order, administrative reviews, and final

results of expedited third five-year review, by effective date

Action

Effective

date

Federal

Register

citation

Period of

review

Antidumping duty margins

Firmspecific1

Countrywide2

Percent ad valorem

Final determination 11/08/94 59 FR 55625

--

China First/China First 0.00

China First/all other 44.66

Guangdong/Three Star 0.00

Guangdong/all other 44.66

SFTC 8.31

Lansheng 17.45 44.66

Antidumping duty

order 12/28/94 59 FR 66909

1994-95

Administrative

review 05/06/97 62 FR 24636

12/21/94 -

11/30/95

China First/China First 0.00

China First/all other 44.66

Guangdong/Three Star 0.00

Guangdong/all other 44.66

SFTC 8.31 44.66

1994-95

Administrative

review, as amended 07/08/97 62 FR 36492

12/21/94 -

11/30/95

China First/China First 0.00

China First/all other 53.65

Guangdong/Three Star 0.00

Guangdong/all other 53.65

SFTC 8.31 53.65

CIT decision

affirming

Commerce’s

remand findings on

final determination 11/13/97

62 FR 65243

(12/11/97) --

China First 8.60

Lansheng 19.36

SFTC 11.15

Guangdong/Three Star 0.00

Guangdong/all others 53.65 53.65

1995-96

Administrative

review 01/07/98 63 FR 779

12/01/95 -

11/30/96

China First/China First 0.00

China First/all other 53.65

SFTC 8.31

Guangdong/Three Star 0.00

Guangdong/all other 53.65 53.65

1996-97

Administrative

review 01/13/99 64 FR 2171

12/01/96 -

11/30/97

China First/China First 0.00

China First/all other 53.65

SFTC 8.31

Guangdong/Three Star 0.00

Guangdong/all other 53.65 53.65

Final determination/

antidumping duty

order, as amended 05/11/99 64 FR 25275 --

China First 8.60

Lansheng 19.36

SFTC 11.15

Guangdong/Three Star 0.00

Guangdong/all others 53.65 53.65

Table continued on following page.

I-7
Table I-2--Continued

Cased pencils: Commerce’s final determination, antidumping duty order, administrative reviews, and final

results of expedited third five-year review, by effective date

Action

Effective

date

Federal

Register

citation

Period of

review

Antidumping duty margins

Firmspecific1

Countrywide2

Percent ad valorem

1998-99

Administrative

review 07/19/01 66 FR 37639

12/01/98 -

11/30/99

China First 53.65

SFTC 8.31

Guangdong/Three Star 0.00

Guangdong/all others 53.65 53.65

1999-2000

Administrative

review 07/25/02 67 FR 48612

12/01/99 -

11/30/00

China First3 11.39

Three Star 11.39

Guangdong3 123.11

SFTC 14.53

Kaiyuan Group 123.11 123.11

1999-2000

Administrative

review, as amended 09/19/02 67 FR 59049

12/01/99 -

11/30/00

China First/Three Star 6.32

SFTC 12.98

Kaiyuan Group 114.90

Guangdong 114.90 114.90

2000-01

Administrative

review 07/21/03 68 FR 43082

12/01/00 -

11/30/01

CalCedar-Tianjin 0.00

Rongxin 15.76 114.90

2001-02

Administrative

review 05/21/04 69 FR 29266

12/01/01 -

11/30/02

China First/Three Star 15.20

SFTC 10.96

Rongxin 27.87 114.90

2002-03

Administrative

review 07/22/05 70 FR 42301

12/01/02 -

11/30/03

China First/Three Star4

 0.61

SFTC 13.25

Rongxin 22.63 114.90

2002-03

Administrative

review, as amended 08/30/05 70 FR 51337

12/01/02 -

11/30/03

China First/Three Star4 0.15

SFTC 12.69

Rongxin 22.63 114.90

2003-04

Administrative

review 07/06/06 71 FR 38366

12/01/03 -

11/30/04

China First/Three Star4 26.62

SFTC 25.70

Rongxin 12.37 114.90

2004-05

Administrative

review 05/14/07 72 FR 27074

12/01/04 -

11/30/05

China First/Three Star4 2.66

Beijing Dixon 2.66

Rongxin 2.66 114.90

Table continued on following page.

I-8
Table I-2--Continued

Cased pencils: Commerce’s final determination, antidumping duty order, administrative reviews, and final

results of expedited third five-year review, by effective date

Action

Effective

date

Federal

Register

citation

Period of

review

Antidumping duty margins

Firmspecific1

Countrywide2

Percent ad valorem

2006-07

Administrative

review 07/13/09 74 FR 33406

12/01/06 -

11/30/07

China First4 26.32

Three Star 60.91

Rongxin 11.48

SFTC 32.90 114.905

2006-07

Administrative

review, as amended 09/01/09 74 FR 45177

12/01/06 -

11/30/07

China First4 10.41

Three Star 59.62

Rongxin 11.48

SFTC 32.21 114.905

2007-08

Administrative

review 07/07/10 75 FR 38980

12/01/07 -

11/30/08

China First4 1.00

Three Star 6.10

Beijing Dixon 3.55

SFTC 3.55

Rongxin 3.55 114.905

Final results of

expedited third

five-year review 03/01/11

76 FR 12323

(03/07/11) --

China First 8.60

Three Star 0.00

Lansheng 19.36

SFTC 11.15

Guangdong 53.65 53.65

 1 In instances where two firms are listed and separated with a forward slash (“/”), the first firm listed is the exporter of the

subject merchandise and the second firm listed is the producer.

 2

 The country-wide rate applies to all companies that otherwise have not received a “firm-specific” rate.

 3

 Commerce determined that China First and Three Star were a single entity for antidumping purposes. Three Star was,

therefore, assigned the margin calculated for China First. Commerce also determined that the Guangdong/Three Star sales

chain was no longer excluded from the order. All merchandise exported by Guangdong was found to be subject to cash deposit

requirements at the PRC-wide rate.

 4

 Commerce combined China First with its subsidiaries Shanghai First Writing Instrument Co., Ltd.; Shanghai Great Wall

Pencil Co., Ltd.; and China First Pencil Fang Zheng Co., Ltd.

 5

 Commerce specifically noted that the PRC-wide entity includes Anhui Import Export Co., Ltd.; Guangdong Provincial

Stationery and Sporting Goods Import Export Corp. (‘‘Guangdong’’); and Tianjin Custom Wood Processing Co., Ltd.

Source: Cited Federal Register notices.

I-9
Distribution of Continued Dumping and Subsidy Offset Act Funds to Affected Domestic Producers

The Continued Dumping and Subsidy Offset Act of 2000 (“CDSOA”) (also known as the Byrd

Amendment) provides that assessed duties received pursuant to antidumping or countervailing duty

orders must be distributed to affected domestic producers for certain qualifying expenditures that these

producers incur after the issuance of such orders.25 Qualified U.S. producers of cased pencils have been

eligible to receive disbursements from the U.S. Customs and Border Protection (“Customs”) under

CDSOA relating to the orders covering the subject merchandise beginning in Federal fiscal year 2001.26

Certifications were filed with Customs with respect to cased pencils from China during 2001-10.27 The

number of firms that filed with Customs varied from year to year, ranging from a total of two to six

companies. In every year except 2001, 2003, and 2008, the following six firms received disbursements

from Customs under CDSOA: Dixon Ticonderoga, General Pencil, Musgrave Pencil, Panda Pencil, Rose

Moon, and Sanford. Table I-3 presents CDSOA disbursements for Federal fiscal years 2001-10.

Related Commission Investigations and Reviews

The Commission has conducted no other related investigations or reviews concerning cased

pencils.

 25 Section 754 of the Tariff Act of 1930, as amended (19 U.S.C. § 1675(c)). The Deficit Reduction Act of 2005

repealed the CDSOA with respect to duties on entries of goods made and filed on or after October 1, 2007. See Pub.

L. No. 109-171, 120 Stat. 4, 154 (2006).

 26 19 CFR 159.64 (g).

 27 Customs’ CDSOA Annual Reports 2001-10,

http://www.cbp.gov/xp/cgov/trade/priority_trade/add_cvd/cont_dump/.

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Table I-3

Cased pencils: CDSOA claims and disbursements, Federal fiscal years 2001-101

Year Claimant

Share of yearly

allocation

Certification

amount2

Amount

disbursed

Percent Dollars

2001

Dixon Ticonderoga 78.1 81,581,515 252,676

Faber-Castell (Newell Rubbermaid) 21.9 22,932,254 71,026

Total, 2001 100.0 104,513,769 323,702

2002

Dixon Ticonderoga 16.1 102,917,411 440,820

General Pencil 2.7 17,208,158 73,707

J.R. Moon Pencil 11.8 75,105,173 321,693

Musgrave Pen & Pencil 5.9 38,000,930 162,767

Panda Pencil 1.3 8,518,285 36,486

Sanford (successor to Empire) 62.2 397,517,819 1,702,663

Total, 2002 100.0 639,267,776 2,738,136

2003

General Pencil 3.3 19,503,104 125,348

J.R. Moon Pencil 13.7 79,605,964 511,633

Musgrave Pen & Pencil 7.2 41,826,411 268,821

Sanford (successor to Empire) 75.8 442,474,230 2,843,811

Total, 2003 100.0 583,409,709 3,749,612

2004

Dixon Ticonderoga 16.5 127,282,798 1,113,853

General Pencil 2.9 22,156,879 193,895

Musgrave Pen & Pencil 6.1 46,556,570 407,417

Panda Pencil 1.5 11,234,461 98,313

Rose Moon 10.8 83,204,025 728,119

Sanford (successor to Empire) 62.2 478,764,506 4,189,674

Total, 2004 100.0 769,199,238 6,731,272

2005

Dixon Ticonderoga 16.8 143,600,009 123,860

General Pencil 3.0 25,381,924 21,893

Musgrave Pen & Pencil 6.1 51,705,369 44,598

Panda Pencil 1.4 12,187,900 10,513

Rose Moon 10.6 89,906,043 77,547

Sanford (successor to Empire) 62.1 528,514,376 455,863

Total, 2005 100.0 851,295,621 734,274

2006

Dixon Ticonderoga 16.5 151,795,443 12,090

General Pencil 3.1 28,578,628 2,276

Musgrave Pen & Pencil 6.2 57,255,880 4,560

Panda Pencil 1.5 13,522,813 1,077

Rose Moon 10.2 93,440,340 7,442

Sanford (successor to Empire) 62.5 574,033,196 45,719

Total, 2006 100.0 918,626,300 73,164

Table continued on following page.

I-11
Table I-3--Continued

Cased pencils: CDSOA claims and disbursements, Federal fiscal years 2001-101

Year Claimant

Share of yearly

allocation

Certification

amount2

Amount

disbursed

Percent Dollars

2007

Dixon Ticonderoga 15.6 153,749,938 2,028,784

General Pencil 3.3 32,425,189 427,862

Musgrave Pen & Pencil 6.5 64,305,630 848,535

Panda Pencil 1.5 14,581,357 192,406

Rose Moon 10.0 99,062,582 1,307,165

Sanford (successor to Empire) 63.1 622,336,890 8,211,952

Total, 2007 100.0 986,461,586 13,016,704

2008

Dixon Ticonderoga 13.9 152,193,607 831,159

General Pencil 4.7 51,606,896 281,835

Musgrave Pen & Pencil 7.4 81,149,351 443,172

Rose Moon 10.4 114,342,696 624,448

Sanford (successor to Empire) 63.6 699,001,309 3,817,382

Total, 2008 100.0 1,098,293,859 5,997,996

2009

Dixon Ticonderoga 13.7 151,146,816 236,209

General Pencil 4.6 51,147,469 79,932

Musgrave Pen & Pencil 7.1 78,265,270 122,311

Panda Pencil 1.3 14,647,012 22,890

Rose Moon 10.3 113,718,248 177,717

Sanford (successor to Empire) 63.0 695,183,927 1,086,420

Total, 2009 100.0 1,104,108,742 1,725,480

2010

Dixon Ticonderoga 13.7 150,907,134 379,197

General Pencil 4.6 51,067,537 128,322

Musgrave Pen & Pencil 7.1 78,142,959 196,356

Panda Pencil 1.3 14,290,396 35,909

Rose Moon 10.3 113,540,532 285,303

Sanford (successor to Empire) 63.0 694,097,507 1,744,116

Total, 2010 100.0 1,102,046,065 2,769,202

 1

 The Federal fiscal year is October 1-September 30.

 2

 Qualifying expenditures incurred by domestic producers since the issuance of an order.

Source: Customs’ CDSOA Annual Reports 2001-10,

http://www.cbp.gov/xp/cgov/trade/priority_trade/add_cvd/cont_dump/.

I-12
THE PRODUCT

Scope

In its most recent Federal Register notice, Commerce defined the subject merchandise as follows:

Imports covered by the order are shipments of certain cased pencils of any shape or

dimension (except as described below) which are writing and/or drawing instruments that

feature cores of graphite or other materials, encased in wood and/or man-made materials,

whether or not decorated and whether or not tipped (e.g., with erasers, etc.) in any

fashion, and either sharpened or unsharpened. The pencils subject to the order are

currently classifiable under subheading 9609.10.00 of the Harmonized Tariff Schedule of

the United States (“HTSUS”). Specifically excluded from the scope of the order are

mechanical pencils, cosmetic pencils, pens, noncased crayons (wax), pastels, charcoals,

chalks, and pencils produced under U.S. patent number 6,217,242, from paper infused

with scents by the means covered in the above-referenced patent, thereby having odors

distinct from those that may emanate from pencils lacking the scent infusion. Also

excluded from the scope of the order are pencils with all of the following physical

characteristics: (1) Length: 13.5 or more inches; (2) sheath diameter: not less than

one-and-one quarter inches at any point (before sharpening); and (3) core length: Not

more than 15 percent of the length of the pencil. In addition, pencils with all of the

following physical characteristics are excluded from the scope of the order: Novelty

jumbo pencils that are octagonal in shape, approximately ten inches long, one inch in

diameter before sharpening, and three-and-one eighth inches in circumference, composed

of turned wood encasing one-and-one half inches of sharpened lead on one end and a

rubber eraser on the other end. Although the HTSUS subheading is provided for

convenience and customs purposes, the written description of the scope of the order is

dispositive.28

Commerce has issued the following scope rulings with respect to cased pencils from China: 

(1) Inspired Design LLC-Pedestal Pets pencil sets are within the scope of the order; (2) It’s Academic

compasses with pencils are outside the scope of the order; (3) Paper Magic Group children’s valentine

card sets with pencils are outside the scope of the order; (4) Walgreen Co. three graphite pencils and three

cased charcoal drawing pencils contained in “Artskills Draw & Sketch Kit” are within the scope of the

order; (5) the remaining items contained in Walgreen’s “Artskills Draw & Sketch Kit,” including one

pencil sharpener, one sanding pad, one black eraser, one kneaded eraser and one tortillion, are outside the

scope of the order; (6) Walgreen’s “ArtSkills Stencil Kit” is not within scope of the order; (7) The

Smencil Co. pencils made from recycled newspaper packaged in plastic cylinders along with scent

applicators in the “Smencils Home Kit” and “Smencils Mini Kit” are within the scope of the order; 

(8) Fiskars Brands, Inc. compasses are not included in the scope of the order; (9) Rich Frog Industries Inc.

decorated wooden gift pencils are within the scope of the order; (10) Target Corp. RoseArt Clip ‘N Color

is excluded from the scope of the order; (11) Barthco Trade Consultants twist crayons are outside the

scope of the order; (12) Target Corp. “Hello Kitty Fashion Totes” are outside the scope of the order; 

(13) Target Corp. “Hello Kitty Memory Maker” is outside the scope of the order; (14) Target Corp.

“Crayola the Wave” is outside the scope of the order; (15) Creative Designs International, Ltd. “Naturally

Pretty,” a young girl’s 10 piece dress-up vanity set, including two 3-inch pencils, is outside the scope of

 28 76 FR 12323, March 7, 2011.

I-13
the order; and (16) Nadel Trading Corp. plastic “quasi-mechanical” pencil known as the Bensia pencil is

outside the scope of the order.

29 

Commerce has also made the following three changed circumstances findings with respect to

cased pencils: (1) certain scent-infused pencils manufactured in China under U.S. patent number

6,217,242 (“Smencils”) are excluded from the order; (2) certain large novelty pencils that meet specific

size and graphite characteristics are excluded from the order; and (3) certain novelty jumbo pencils that

meet specific size, encasing and graphite characteristics are excluded from the order.30

U.S. Tariff Treatment

Cased pencils are currently provided for under Harmonized Tariff Schedule of the

United States (“HTS”) subheading 9609.10.00, “Pencils and crayons, with leads encased in a rigid

sheath.” The specific HTS subheading includes both lead pencils and colored pencils, but does not

include mechanical pencils or cosmetic pencils, which are excluded from the order.31 The HTS number is

a somewhat broader category than the scope of this order as it includes certain items that have been

specifically excluded from the order (e.g., certain novelty jumbo pencils). Also, some pencils contained

in sets are classified elsewhere in the nomenclature, depending on the items in each such set and on the

possible tariff provisions that might apply.32 A column-1 general rate of 14 cents/gross33 + 4.3 percent ad

valorem is applicable to imports of cased pencils from China.

Domestic Like Product and Domestic Industry

The domestic like product is the domestically produced product or products which are like, or in

the absence of like, most similar in characteristics and uses with, the subject merchandise. The domestic

industry is the collection of U.S. producers as a whole of the domestic like product, or those producers

whose collective output of the domestic like product constitutes a major proportion of the total domestic

production of the product. In its original determination and in its expedited first and second five-year

review determinations, the Commission defined the domestic like product as all cased pencils,

coextensive with Commerce’s scope, and it defined the domestic industry as all domestic producers of

cased pencils.34 In the original determination, the Commission excluded one domestic producer, Pentech,

from the domestic industry under the related parties provision.35 The domestic interested parties did not

 29 Issues and Decision Memorandum for the Final Results of the Expedited Third Five-Year Sunset Review of the

Antidumping Duty Order on Certain Cased Pencils from the People’s Republic of China, March 1, 2011, p. 4.

 30 Ibid, p. 3.

 31 Mechanical pencils are covered separately under HTS heading 9608 and pencils for cosmetic use are covered

under chapter 33 of the HTS.

 32 Such sets could include, e.g., art sets or similar goods that are ready for retail sale and have a variety of items;

some sets may be classified under general rule of interpretation 3(b) based on the component that gives the set its

essential character.

 33 One gross is a group of 12 dozen, or 144, items.

 34 Cased Pencils From China: Investigation No. 731-TA-669 (Second Review), USITC Publication 3820,

November 2005, pp. 5 and 6.

 35 The domestic interested parties indicated during the first review of the order that Pentech had ceased domestic

manufacturing operations and was purchasing only imports, primarily from China. In late 1999, Pentech formed a

strategic partnership with a manufacturer in Shanghai, China, both to manufacture existing products and to develop

new product lines. Cased Pencils From China: Investigation No. 731-TA-669 (Second Review), USITC Publication

3820, November 2005, pp. 5, 6, and I-6.

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comment on the Commission’s definitions of the domestic like product and the domestic industry in their

responses to the Commission’s notice of institution in this third five-year review.

Physical Characteristics and Uses36

As indicated in the scope definition, cased pencils are writing and/or drawing instruments that

feature cores of graphite or other materials, encased in wood and/or man-made materials. The wood in

most instances, is covered with several coats of quick drying lacquer (painted) and is tipped with an eraser

and a ferrule (the small circular band of aluminum which affixes the eraser to the top of the pencil) to

make a finished pencil. Cased pencils of all types are used almost exclusively for writing and drawing on

paper or making marks on other objects. Decorated, designer, and novelty pencils are used not only for

writing but also for collecting, especially by children.37

As was the case in the original investigation and prior five-year reviews, the most commonly sold

pencil today is the so-called commodity or economy pencil, the standard yellow No. 2 pencil.38 Virtually

all commodity pencils sold in the United States are of the same color, hardness, diameter, and length, and

have similarly attached ferrules and erasers. The domestic interested parties indicated in their responses

to the Commission’s notice of institution in this third five-year review that there is very little to

distinguish the commodity or economy pencil of one producer from another and, therefore, a very large

portion of the U.S. pencils market remains the very definition of “commodity.” They also indicated that

China produces both commodity and specialty products that compete directly with U.S. producers’ cased

pencils.39

In addition to commodity or economy pencils, many different types of specialty and custom

pencils are produced in the United States, including colored, golf, decorated, designer, novelty,

promotional, advertising, carpenter, and drawing pencils. In fact, the domestic interested parties indicated

in their responses that many of the remaining U.S. pencil producers concentrate on supplying specialty

pencils (e.g., golf pencils) and custom pencils for promotion and awards since Chinese imports have

dominated the U.S. market segments for low-priced commodity pencils and large volume run decorator

pencils.40 Although the bulk of reported imports from China during the original investigation was

comprised of raw pencils41 and commodity pencils, the domestic interested parties indicated that Chinese

producers have developed the ability to produce smaller volume runs of decorator pencils (below 100,000

gross) and have expanded their participation in the pencil “blank” segment.42 They also indicated that the

 36 Unless indicated otherwise, the discussion in this section is based on information contained in Cased Pencils

From China: Investigation No. 731-TA-669 (Second Review), USITC Publication 3820, November 2005, 

pp. I-6 and I-7.

 37 Decorated pencils have multicolored designs (i.e., cartoon characters) or design-covered foil on the case.

Novelty pencils are tipped with an item such as a “troll head.”

 38 The number designation on a pencil refers to the hardness of the core, 1 being the softest and 4 the hardest.

 39 Response of General Pencil, Musgrave Pencil, and Sanford, December 1, 2010, p. 12; and Response of Dixon

Ticonderoga, December 1, 2010, p. 18.

 40 Response of Dixon Ticonderoga, December 1, 2010, p. 12; and Response of General Pencil, Musgrave Pencil,

and Sanford, December 1, 2010, pp. 12 and 13.

 41 A “raw” pencil has not been lacquered and has not had the eraser and ferrule added.

 42 Pencil blanks are unpainted and undecorated pencils that are used for printing customized messages. The

domestic interested parties indicated in their response that companies that finish blanks have moved away from

domestic suppliers in favor of Chinese imports. Response of General Pencil, Musgrave Pencil, and Sanford,

December 1, 2010, pp. 12 and 13.

I-15
antidumping duty order has permitted the domestic industry to remain competitive in these important

specialty market areas.43 

Manufacturing Process44

The production process for both domestic and imported cased pencils is essentially the same and

production techniques have remained essentially unchanged since the original investigation. There have

been no remarkable technological advances concerning the production process and the product and the

industry are considered to be technologically mature.45

The standard core of a cased pencil is made of graphite, clay, wax, and proprietary chemical

mixtures, the specific combination of which determines its hardness. The pencil sheath is usually made of

wood, typically California incense cedar wood for premium pencils and basswood for value lines of

pencils.46 A groove is cut into the sheath to house the pencil core. Glue is then applied to the surface of

the groove and the core is placed in the groove. Another sheath with a similar groove cut into it is then

glued on top of the first sheath, making what is called a “sandwich.” The sandwich is then clamped under

pressure to insure bonding and reduce warping. After the sandwich has bonded, it is trimmed and then

milled into separate pencils, typically nine. Three to seven coats of lacquer are applied to the pencils,

followed by a clear coat. An eraser is then attached with a crimped ferrule to each pencil.

Interchangeability and Customer and Producer Perceptions47

The report for the original investigation indicated that the differences in appearance between

U.S.-produced and imported cased pencils were not sufficiently great for the average retail customer to

detect them. The imported pencils subject to the investigation, however, were made from lower quality,

less expensive wood, eraser, ferrules, and cores than comparable U.S.-made articles. In response to

questionnaires issued during the original investigation, U.S. importers generally conceded that the

Chinese-produced pencils they imported were of lower quality than domestically produced pencils. The

U.S. producers also alleged during the original investigation that the subject imports from China

competed, for the most part, within the standard, black-lead commodity pencil category, and specifically

with the lowest priced pencil in this category, the economy pencil. Commodity pencils typically varied

according to the quality of the pencil and its price, with the higher priced commodity pencils having a

better quality wood casing, ferrule, eraser, and a smoother lead. 

As they did in the second five-year review, the domestic interested parties noted in this five-year

review that a very large portion of the U.S. cased pencil market remains the very definition of

“commodity” and that there is very little to distinguish the commodity pencils of one producer from

 43 Response of General Pencil, Musgrave Pencil, and Sanford, December 1, 2010, pp. 12 and 13.

 44 Unless indicated otherwise, the discussion in this section is based on information contained in Cased Pencils

From China: Investigation No. 731-TA-669 (Second Review), USITC Publication 3820, November 2005, p. I-7.

 45 Response of General Pencil, Musgrave Pencil, and Sanford, December 1, 2010, p. 12.

 46 The domestic interested parties indicated that the largest raw material input in cased pencil production is the

wooden sheath (or “slats”) and that there have been substantial price increases for both cedar and basswood since the

most recent sunset review: *** percent increase for cedar and *** percent increase for basswood. Musgrave Pencil

indicated in its response to the Commission’s notice of institution in this third review that “***.” Response of Dixon

Ticonderoga, December 1, 2010, p. 12; and Response of General Pencil, Musgrave Pencil, and Sanford, December 1,

2010, exh. C.

 47 Unless indicated otherwise, the discussion in this section is based on information contained in Cased Pencils

From China: Investigation No. 731-TA-669 (Second Review), USITC Publication 3820, November 2005, pp. I-7 and

I-8.

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another. They also noted that China produces both commodity and specialty products that compete

directly with U.S. producers’ cased pencils.48 In addition, the domestic interested parties reported that

Chinese imports had continued to make inroads beyond the low-priced commodity pencil and

large-volume run decorator pencil market segments where domestic producers previously had dominated. 

They noted that Chinese producers had continued to develop the ability to produce smaller volume runs

of decorator pencils (below 100,000 gross), which was a market niche primarily served by domestic

producers. They also reported that Chinese pencil producers had continued to expand their participation

in the pencil “blank” market segment and that the U.S. companies that finished blanks had moved away

from domestic suppliers in favor of Chinese imports.49

Channels of Distribution50

Cased pencils produced in the United States are mainly sold to retailers (e.g., K-Mart, Wal-Mart,

Staples, and Target) and to distributors, which in turn sell to end users, including schools, businesses, and

individual consumers. Pencils imported from China during the original investigation reached the market

through the same channels of distribution. Many distributors sold both domestic and imported pencils. 

The largest market segment was the retail mass market (*** percent of U.S.-produced cased pencils and

*** percent of U.S. shipments of cased pencils imported from China), which consisted of cased pencils

sold directly to the public, usually in boxes or blisterpacked cards containing a dozen pencils or fewer. 

The office supply market was another large market segment. Pencils in this market segment tended to be

higher priced than in the retail mass market and this segment was the most profitable for domestic

producers during the original investigation. Decorated and novelty cased pencils formed another

significant market segment, as did cased pencils sold to schools.

The report for the original investigation indicated that the office supply market was undergoing

significant changes as smaller regional distributors were increasingly supplanted by nationwide catalogue

wholesalers or by office supply superstore chains, such as Staples. This shift placed downward pressure

on pencil prices as larger buyers demanded lower prices for the increased volume of pencils purchased. 

As was the case in the second five-year review, the domestic interested parties in their responses to the

Commission’s notice of institution in this third five-year review reported that, although there have been

no new end users developed since the order was published, big box retailers, national office supply

chains, national catalog companies, large stationery firms, and mass market merchandisers have

consolidated their dominance in the market, so that there are fewer, larger purchasers with greater

negotiating power, placing further downward pressures on prices. Moreover, the domestic interested

parties claimed that large purchasers are now directly importing cased pencils from China, rather than

purchasing from importers. In fact, the domestic interested parties noted that virtually all of these large

scale purchasers maintain full-time purchasing operations in China (either through affiliated companies or

purchasing agents), which enables them to negotiate the cheapest possible prices from Chinese and other

Asian suppliers. Moreover, there are well established channels of distribution for subject cased pencils,

including importers/distributors that have a long history of selling PRC-origin and other imported product

on a nationwide basis.51

 48 Response of Dixon Ticonderoga, December 1, 2010, p. 18.

 49 Response of General Pencil, Musgrave Pencil, and Sanford, December 1, 2010, pp. 12 and 13.

 50 Unless indicated otherwise, the discussion in this section is based on information contained in Staff Report on

Investigation No. 731-TA-669 (Second Review): Cased Pencils From China, INV-CC-185, October 26, 2005, pp. I11 and I-12.

 51 Response of Dixon Ticonderoga, December 1, 2010, pp. 11-13; Response of General Pencil, Musgrave Pencil,

and Sanford, December 1, 2010, pp. 12-13.

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In addition, e-commerce provides Chinese producers and exporters with almost-immediate and

easy access to buyers in the U.S. market through dozens of internet trading portals and hundreds of

individual companies that offer bulk products for sale, including cased pencils. The domestic interested

parties noted that the increase in internet-based buying and selling is particularly evident in the specialty

and custom cased pencils segment of the market, where U.S. production has been concentrated.52

In the Commission’s notice of institution in this third five-year review, interested parties were

asked to provide a listing of the top U.S. purchasers of domestic and imported cased pencils. Top

purchasers listed by the domestic producers in their responses included the following firms: ***.53

Responses received from purchaser surveys mailed to the purchasers identified in the adequacy phase of

this review are presented in appendix C.

Pricing54

Cased pencils are priced differently according to the pencil type (i.e., commodity, carpenter,

colored, specialty, etc.), the quality of the specific pencil, the size of the order, and the required packing

(i.e., blister-wrapped packages for retail sales or boxed in bulk). They are generally sold on a delivered 

basis and typically priced by the gross by both U.S. producers and importers. 

U.S. domestic producers reported selling a full range of pencil products during the original

investigation; while U.S. importers of the Chinese product sold primarily low-priced commodity pencils,

specialty pencils, and pencil blanks. The Commission’s original investigation established the price

sensitive nature of the U.S. market for cased pencils and noted that the market trends would “increase the

importance of price alone and increase the downward pressure on commodity pencils, forcing competition

in a way the domestic industry cannot compete.” 

As the Commission has found in the past, the domestic interested parties argued that competition

for cased pencils remains centered principally on price as manufacturers fight for a share of a mature

market. They noted that cased pencils continue to be a fungible, price sensitive product, with a large

share of sales being made to a few large customers. As previously indicated, large stationery firms and

mass market merchandisers have consolidated their dominance in the U.S. market, so that there are fewer,

larger purchasers of cased pencils with greater negotiating power. These large purchasers often directly

import cased pencils from China, rather than purchase from an importer, and make purchasing decisions

on the basis of price alone.55

Although there are no pricing data available for the U.S. product or for the U.S. imports of

subject merchandise, U.S. producer Dixon Ticonderoga provided limited information concerning prices of

cased pencils. Based on market intelligence available to Dixon Ticonderoga, the domestic wholesaler to

retailer price of a standard yellow No. 2 pencil in China during the second half of 2010 was $*** per

gross. By contrast, the average manufacturer to first tier distributor price for the same product in the

United States was $*** per gross. The firm noted that the U.S. prices of the commodity pencil was over

*** percent above the Chinese price and that the higher cased pencils prices in the United States, as

 52 Response of Dixon Ticonderoga, December 1, 2010, pp. 23-25 and 30.

 53 Response of General Pencil, Musgrave Pencil, and Sanford, December 1, 2010, exhs. A, B, and C; and

Response of Dixon Ticonderoga, December 1, 2010, exh. 3.

 54 Unless indicated otherwise, the discussion in this section is based on information contained in Cased Pencils

From China: Investigation No. 731-TA-669 (Second Review), USITC Publication 3820, November 2005, p. I-8.

 55 Response of Dixon Ticonderoga, December 1, 2010, p. 11; and Response of General Pencil, Musgrave Pencil,

and Sanford, December 1, 2010, pp. 8 and 12.

I-18
compared with the Chinese market and alternative export markets, also make the United States an

attractive export market for Chinese producers of cased pencils.56

THE INDUSTRY IN THE UNITED STATES

U.S. Producers

The original investigation resulted from a petition filed on behalf of the PMA (and the individual

companies comprising its membership) on November 10, 1993. In that investigation, the Commission

identified 11 U.S. manufacturers of cased pencils, six of which provided useful information in response to

Commission questionnaires. The three largest producers of cased pencils in 1993, Empire (*** percent of

reported production), Faber (*** percent), and Dixon Ticonderoga (*** percent), offered primarily the

standard, black-lead commodity pencil. Moon and Pentech concentrated in higher priced specialty

pencils, while Musgrave reported that it mainly sold pencil blanks to advertising specialty companies.57

During the first five-year review of the antidumping duty order, the domestic interested parties

reported that there were “at most nine and possibly only seven” U.S. producers of cased pencils.58 A

submission to the Commission in response to its notice of institution in the first review was filed on

behalf of the Pencil Section of the WIMA and six domestic producers.59

The domestic interested parties that participated in the Commission’s second five-year review of

the order indicated that there had been no further industry restructuring since the first review. However,

in 2002, subsequent to the Commission’s determination in the first review of the order, Dixon

Ticonderoga shifted much of its pencil production to China, although it continued to manufacture the

Ticonderoga brand pencils in the United States. In their response to the Commission’s notice of

institution in the second five-year review, the domestic interested parties listed the following nine firms as

domestic producers of cased pencils: Aakron Rule, Dixon Ticonderoga, General Pencil, Harcourt Pencil

Co. (“Harcourt”), Musgrave Pencil, Panda Pencil Co. (“Panda Pencil”), Rose Moon, Sanford, and

Tennessee Pencil. In 2004, the three largest producers of cased pencils were Sanford (***), Rose Moon

(***), and Musgrave (***).60

In this third five-year review of the antidumping duty order, the participating domestic producers

reported that the following eight firms currently produce cased pencils in the United States: Aakron Rule,

Dixon Ticonderoga, General Pencil, Harcourt, Musgrave Pencil, Panda Pencil, Rose Moon, and

 56 Response of Dixon Ticonderoga, December 1, 2010, p. 20.

 57 Staff Report on Investigations Nos. 731-TA-669 and 670 (Final): Certain Cased Pencils from the People’s

Republic of China (China) and Thailand, INV-R-147, September 28, 1994, pp. I-4, I-16, and I-17.

 58 Cased Pencils From China: Investigation No. 731-TA-669 (Review), USITC Publication 3328, July 2000, 

p. I-9.

 59 The six domestic producers, who were all full members of WIMA, were: Aakron Rule Corp. (“Aakron

Rule”), Dixon Ticonderoga, General Pencil, Musgrave, Sanford, and Tennessee Pencil. Cased Pencils From China: 

Investigation No. 731-TA-669 (Review), USITC Publication 3328, July 2000, p. I-3.

 60 Staff report on Investigation No. 731-TA-669 (Second Review): Cased Pencils from China, INV-CC-185,

October 26, 2005, p. I-14.

I-19
Sanford.61 They also reported that, since the Commission’s second sunset review, domestic producer

Tennessee Pencil ceased production of pencils62 and ***. ***, they noted that domestic producer Sanford

*** at its Lewisburg, TN pencil factory, and domestic producer Dixon Ticonderoga closed its Versailles,

MO production factory.63 The domestic interested parties also indicated that the four U.S. producers that

are participating in this third five-year review (i.e., Dixon Ticonderoga, General Pencil, Musgrave Pencil,

and Sanford) are believed to account for approximately 88 percent of U.S. production of cased pencils.64

Data provided by the four domestic pencil producers are presented separately in table I-4. Based on the

aggregate 2009 U.S. production data provided in the responses to the Commission’s notice of institution,

Sanford is the largest of the four domestic producers of cased pencils, accounting for *** percent of

reported 2009 U.S. production. Musgrave Pencil accounted for *** percent of reported 2009 U.S.

production, Dixon Ticonderoga accounted for *** percent, and General Pencil accounted for ***

percent.65

Table I-4

Cased pencils: U.S. producers’ trade and financial data, by firm, 2009

* * * * * * *

U.S. Producers’ Trade, Employment, and Financial Data

Table I-5 presents data reported by U.S. producers of cased pencils in the Commission’s original

investigation and its subsequent reviews. Domestic data presented in the Commission’s staff report for

the period examined in the final phase of the original investigation were provided by the following five

producers of cased pencils: Dixon Ticonderoga, Empire, Faber, Rose Moon, and Musgrave Pencil.66

Data presented for the first five-year review were provided by six domestic cased pencil producers

(Aakron Rule, Dixon Ticonderoga, General Pencil, Musgrave Pencil, Sanford (corporate successor in

interest to Faber and Empire), and Tennessee Pencil) that were believed to have represented *** percent

 61 Response of Dixon Ticonderoga, December 1, 2010, p. 8; and Response of Sanford, General Pencil, and

Musgrave Pencil, December 1, 2010, pp. 2 and 10. The Pencil Pages (a website maintained by an individual pencil

collector) lists additional companies as producing pencils in the United States. Based on information provided in

The Pencil Pages and from individual company websites, other possible domestic producers of pencils may include

Chattahoochee Pencil Co. (Atlanta, GA), National Pencil Co. LLC (Shelbyville, TN), Seaboard Pencil Co.

(Brooksville, IL), Shelbyville Pencil Co. (Shelbyville, TN), and Tree Smart, Inc. (Lake Oswego, OR). See

www.pencilpages.com.

 62 Tennessee Pencil was primarily a producer of specialty, promotional pencils. Response of Dixon Ticonderoga,

December 1, 2010, p. 8.

 63 Response of Sanford, General Pencil, and Musgrave Pencil, December 1, 2010, p. 3.

 64 The domestic interested parties’ estimate was calculated based on information regarding distributions under the

CDSOA. Response of Sanford, General Pencil, and Musgrave Pencil, December 1, 2010, p. 10.

 65 Response of Dixon Ticonderoga, December 1, 2010, exh. 4.

 66 A sixth producer that provided a response to the Commission’s questionnaire in the final investigation,

Pentech, was excluded as a related party by the Commission from the domestic industry in its original determination.

Therefore, the data of Pentech are not included in the domestic industry data presented. Staff Report on

Investigations Nos. 731-TA-669 and 670 (Final): Certain Cased Pencils from the People’s Republic of China

(China) and Thailand, INV-R-147, September 28, 1994, table 2.

I-20
of U.S. production of cased pencils in 1998.67 Data presented for the second five-year review were

provided by five producers (General Pencil, Musgrave Pencil, Rose Moon, Sanford, and Tennessee

Pencil) that were believed to have represented *** percent of U.S. production of cased pencils in 2004.68

Data presented for the third five-year review were provided by four producers (Dixon Ticonderoga,

General Pencil, Musgrave Pencil, and Sanford) that were believed to have represented approximately 88

percent of U.S. production of cased pencils in 2009.69

Table I-5

Cased pencils: U.S. producers’ trade, employment, and financial data, 1991-93, 1998, 2004, and

2009

* * * * * * *

The domestic interested parties participating in this third five-year review argued that the

production and financial data provided in response to the Commission’s notice of institution demonstrate

that the U.S. industry manufacturing cased pencils is in poor condition, and has deteriorated markedly

since the second five-year review. Indeed, production, shipment quantity, and shipment value have fallen

since 2004 and financial indicators show an overall *** for the domestic industry. In particular, Sanford

and General Pencil explained ***. The domestic producers also argued that the reduction in their

domestic shipments has been the result of Chinese import competition in market niches primarily served

by domestic producers, such as in smaller volume runs of decorator pencils (below 100,000 gross) and in

the pencil “blank” market segment. They emphasized that because of the worldwide recession, weak

demand for cased pencils, and raw material price increases,70 U.S. production of cased pencils has fallen

and the U.S. cased pencil industry is in a more vulnerable state than it was in the most recent sunset

review.71

Two of the four participating domestic producers of cased pencils provided separate comments in

their responses to the Commission’s notice of institution in this third five-year review on the likely effects

of the revocation of the antidumping order on the U.S. industry in general and/or their firm specifically. 

In its response, *** commented: “***.” *** provided the following comment: “***.”

Related Party Issues

The domestic producers indicated in their responses to the Commission’s notice of institution in

this third five-year review that the only domestic producer that qualifies as a related party is Dixon

 67 Staff Report on Investigation No. 731-TA-669 (Review): Cased Pencils from China, INV-X-139, June 22,

2000, p. I-3.

 68 Staff Report on Investigation No. 731-TA-669 (Second Review): Cased Pencils from China, INV-CC-185,

October 26, 2005, p. I-3.

 69 The domestic interested parties’ estimate was calculated based on information regarding distributions under the

CDSOA. Response of Sanford, General Pencil, and Musgrave Pencil, December 1, 2010, p. 10.

 70 As previously indicated, the largest raw material input in pencil production is wooden slats and that there have

been price increases of *** percent for cedar and *** percent for basswood since the most recent sunset review. In

addition, the domestic producers indicated that raw materials costs are expected to increase over the next few years

because of worldwide shortages of cedar and basswood. In fact, they stated that China, the major source for

basswood, has announced 2011 price increases of *** percent over current levels. Response of Dixon Ticonderoga,

December 1, 2010, pp. 12 and 30.

 71 Response of Dixon Ticonderoga, December 1, 2010, pp. 6, 12, and 30; and Response of General Pencil,

Musgrave Pencil, and Sanford, December 1, 2010, pp. 3-4 and 12-13.

I-21
Ticonderoga. Dixon Ticonderoga reported in its response that, in addition to producing the domestic like

product, it is also currently a U.S. importer of the subject merchandise and wholly owns Beijing Fila

Dixon Stationery Co., Ltd., a Chinese producer and exporter of the subject merchandise.72 

Dixon Ticonderoga was a petitioner in the original investigation and participated in the first and

current (third) five-year reviews in support of the continuation of the order by responding to the

Commission’s notices of institution. The firm did not respond to the Commission’s notice of institution

in the second five-year review. In the original investigation, the Commission reported that Dixon

Ticonderoga was ***. Dixon Ticonderoga was not identified during the Commission’s first five-year

review of the order as a related party. In the second five-year review, however, the Commission reported

that although Dixon Ticonderoga continued to manufacture Ticonderoga brand pencils in Missouri, the

firm shifted much of its pencil production to China in 2002.73

Certain data concerning Dixon Ticonderoga’s U.S. production of cased pencils, subject imports,

and affiliated Chinese producer exports to the United States during 2009 are presented in table I-6. 

Table I-6

Cased pencils: Certain data concerning Dixon Ticonderoga’s U.S. production, subject imports,

and affiliated Chinese producer exports to the United States, 2009

* * * * * * *

Dixon Ticonderoga reported that, in 2009, it produced *** gross of cased pencils in the United

States and imported *** gross ($***) of subject cased pencils from related and unrelated pencil producers

in China combined. The unit value of Dixon Ticonderoga’s 2009 cased pencil imports from China was

$*** per gross, which was lower than the average unit value of total U.S. cased pencil imports from

China of $5.53 per gross (see table I-8). The unit value of Dixon Ticonderoga’s 2009 cased pencil

imports from China was also *** lower than the average unit value of its 2009 U.S.-produced U.S.

commercial shipments, which was $*** per gross (see table I-4). The domestic producer also reported

that its Chinese subsidiary produced and exported to the United States *** gross ($***) of subject cased

pencils in 2009 at an average unit value of $*** per gross.74 Additional data provided by Dixon

Ticonderoga on its 2009 domestic operations were previously presented separately in table I-4.

U.S. IMPORTS AND APPARENT U.S. CONSUMPTION

U.S. Importers

During the original investigation, the Commission identified 27 U.S. importers of cased pencils

from China (who imported either directly from China or through Hong Kong). The firms were located

throughout the United States and reported selling the imported product nationwide. In the first review,

the domestic interested parties identified five firms that imported pencils from China and, in their

 72 Response of Dixon Ticonderoga, December 1, 2010, p. 7; and Supplemental Response of Dixon Ticonderoga,

January 6, 2011.

 73 Staff Report in Investigations Nos. 731-TA-669 and 670 (Final): Certain Cased Pencils from the People’s

Republic of China (China) and Thailand, INV-R-147, September 28, 1994, p. I-18 and table 2; Staff Report in

Investigation No. 731-TA-669 (Review): Cased Pencils from China, INV-X-139, June 22, 2000, pp. I-13 and I-16;

and Staff Report in Investigation No. 731-TA-669 (Second Review): Cased Pencils from China, INV-CC-185,

October 26, 2005, pp. I-3, I-14, and I-18.

 74 Response of Dixon Ticonderoga, December 1, 2009, exh. 4; and Supplemental Response of Dixon

Ticonderoga, January 5, 2011, exhs. 3 and 4.

I-22
response to the Commission’s notice of institution in the second five-year review, the domestic interested

parties identified 12 possible U.S. importers of the subject merchandise from China.75 

In this third five-year review, the domestic interested parties identified more than 60 U.S.

importers of cased pencils from China in their responses to the Commission’s notice of institution. As

previously indicated, the domestic interested parties indicated that Dixon Ticonderoga is a related party

inasmuch as it is an importer of subject cased pencils from unrelated sources in China and from its related

Chinese production facility. 

U.S. Imports76

U.S. imports of cased pencils are presented in table I-7 (1991-93, 1997-99, and 2000-04), 

table I-8 (2005-09), and figure I-1.77 All producers of cased pencils in China are currently subject to the

antidumping duty order.78 China has remained the leading supplier of cased pencils to the United States

since the original investigation. In the current five-year period of review, China’s share of total imports

fell from 44.6 percent in 2005 to 43.9 percent in 2007, before climbing to 49.1 percent in 2009. The

quantity of U.S. imports of cased pencils found to be sold at LTFV increased by 226.2 percent from 1991

to 1993, and then increased by 127.0 percent from 1993 to 2004. U.S. imports from China/Hong Kong

then increased further by 16.4 percent from 2005 to 2009. According to official U.S. import statistics,

imports of cased pencils from China/Hong Kong during 2009 amounted to 10.5 million gross ($58.3

million, landed duty-paid), which was more than *** the combined 2009 U.S. production of Dixon

Ticonderoga, General Pencil, Musgrave Pencil, and Sanford (*** gross). The average unit value of cased

pencils from China increased from $4.68 per gross in 2005 to $6.13 per gross in 2008 before falling to

$5.53 per gross in 2009. The 2009 average unit value of cased pencils imported from China ($5.53 per

gross) was lower than the average unit values of U.S. commercial shipments of Dixon Ticonderoga ($***

per gross), General Pencil ($*** per gross), and Musgrave Pencil ($*** per gross), but was higher than

the unit value of U.S. commercial shipments reported by domestic producer Sanford ($*** per gross).

 75 Cased Pencils From China: Investigation No. 731-TA-669 (Second Review), USITC Publication 3820,

November 2005, p. I-11.

 76 The subject merchandise is currently provided for in HTS subheading 9609.10.00, “Pencils and crayons, with

leads encased in a rigid sheath,” which may include certain merchandise that has been excluded from the scope of

the order. Also, some pencils contained in sets are classified elsewhere in the nomenclature, depending on the items

in each such set.

 77 The petition for the original investigation alleged that cased pencils produced in China were often transhipped

through Hong Kong. Information supplied in questionnaire responses submitted to the Commission supported this

allegation. Therefore, import data for China presented in the original investigation and subsequent reviews include

imports of cased pencils from Hong Kong. Staff Report on Investigations Nos. 731-TA-669 and 670 (Final): 

Certain Cased Pencils from the People’s Republic of China (China) and Thailand, INV-R-147, September 28, 1994,

p. I-23.

 78 Exports of pencils by Guangdong that were manufactured by Three Star were originally excluded from the

order, as were pencils exported by China First. However, China First became subject to the antidumping duty order

following court-ordered remand proceedings in 1999. In addition, China First and Three Star were determined by

Commerce to be a single entity for antidumping purposes in 2002, meaning that pencils manufactured by Three Star

and exported by Guangdong, which previously had been excluded from the order, were placed under its coverage.

I-23
Table I-7

Cased pencils: U.S. imports, by source, 1991-93, 1997-99, and 2000-04

Source

Original investigation First review Second review

1991 1992 1993 1997 1998 1999 2000 2001 2002 2003 2004

Quantity (1,000 gross)

China/Hong Kong:

 Fair value1

 imports *** *** *** (2) (2) (2) (2) (2) (2) (2) (2)

 LTFV imports *** *** *** (2

) (2) (2) (2) (2) (2) (2) (2)

 Subtotal 1,306 3,276 4,724 3,835 6,002 5,961 7,246 7,519 7,499 7,879 9,224

Other sources3 1,791 1,642 2,009 7,520 8,858 6,175 7,207 6,592 8,068 8,862 9,027

 Total 3,098 4,918 6,734 11,355 14,860 12,136 14,453 14,411 15,567 16,741 18,251

Value ($1,000)

China/Hong Kong:

 Fair value1

 imports (2) (2) (2) (2) (2) (2) (2) (2) (2) (2) (2)

 LTFV imports (2

) (2) (2) (2) (2) (2) (2) (2) (2) (2) (2)

 Subtotal 9,029 17,957 21,691 17,410 28,820 29,455 34,988 33,503 34,749 37,519 41,370

Other sources3 23,551 28,766 25,915 61,455 75,668 54,727 64,213 57,750 64,245 76,594 72,942

 Total 32,580 46,724 47,605 78,865 104,488 84,182 99,201 91,253 98,994 114,113 114,312

Unit value (per gross)

China/Hong Kong:

 Fair value1

 imports (2) (2) (2) (2) (2) (2) (2) (2) (2) (2) (2)

 LTFV imports (2

) (2) (2) (2) (2) (2) (2) (2) (2) (2) (2)

 Subtotal $6.91 $5.48 $4.59 $4.54 $4.81 $4.94 $4.83 $4.46 $4.63 $4.76 $4.48

Other sources3 13.15 17.52 12.90 8.17 8.54 8.86 8.91 8.76 7.96 8.64 8.08

 Total 10.52 9.50 7.07 6.95 7.03 6.94 6.86 6.47 6.36 6.82 6.26

 1 Exports of pencils by Guangdong that are manufactured by Three Star were originally excluded from the order, as were pencils exported by China

First. However, China First became subject to the order following court-ordered remand proceedings in May 1999. In addition, China First and Three

Star were subsequently determined by Commerce to be a single entity for antidumping purposes, meaning that pencils manufactured by Three Star

and exported by Guangdong, which previously had been excluded from the order, were placed under its coverage in July 2002.

 2

 Not available.

 3

 Primary nonsubject sources during 1991-93 were Brazil, Indonesia, Taiwan, and Mexico. In 2004, the primary other sources were Indonesia,

Brazil, Costa Rica, Thailand, and Taiwan.

Note.--The petition for the original investigation alleged that cased pencils produced in China were often transhipped through Hong Kong. Information

supplied in questionnaire responses submitted to the Commission supported this allegation. Therefore, import data for China presented in the original

investigation and subsequent reviews include imports of cased pencils from Hong Kong.

Source: Staff Report on Investigation No. 731 -TA-669 (Second Review): Cased Pencils from China, INV-CC-185, October 26, 2005, table I-5.

I-24
Table I-8

Cased pencils: U.S. imports, by source, 2005-09

Source 2005 2006 2007 2008 2009

Quantity (1,000 gross)

China 9,024 10,017 10,398 9,886 10,521

Hong Kong1 21 22 5 8 9

 Subtotal1 9,045 10,039 10,402 9,895 10,530

Nonsubject countries:

 Indonesia 3,481 4,047 3,998 3,457 2,827

 Taiwan 1,471 1,815 1,867 1,229 2,275

 Brazil 1,626 2,369 2,555 2,321 2,101

 Costa Rica 2,558 1,581 1,461 1,523 1,488

 Vietnam 103 446 1,518 959 731

 Other2 1,968 2,327 1,892 2,170 1,482

 Subtotal, nonsubject 11,207 12,585 13,292 11,658 10,904

 Total, all countries 20,252 22,624 23,694 21,553 21,434

Value ($1,000)

China 42,199 49,489 55,972 60,588 58,213

Hong Kong1 104 514 149 183 84

 Subtotal1 42,303 50,003 56,121 60,770 58,297

Nonsubject countries:

 Indonesia 15,024 16,035 18,834 15,067 11,352

 Taiwan 10,881 11,661 13,099 9,423 16,426

 Brazil 18,114 22,331 28,597 24,634 19,005

 Costa Rica 12,442 12,040 11,845 9,379 10,088

 Vietnam 922 2,731 7,836 5,039 4,153

 Other2 20,370 26,222 26,802 25,919 20,825

 Subtotal, nonsubject 77,752 91,020 107,013 89,461 81,850

 Total, all countries 120,055 141,023 163,133 150,232 140,147

Table continued on the following page.

I-25
Table I-8--Continued

Cased pencils: U.S. imports, by source, 2005-09

Source 2005 2006 2007 2008 2009

Unit value (per gross)

China $4.68 $4.94 $5.38 $6.13 $5.53

Hong Kong1 5.01 23.44 32.74 21.54 9.39

 Subtotal1 4.68 4.98 5.40 6.14 5.54

Nonsubject countries:

 Indonesia 4.32 3.96 4.71 4.36 4.02

 Taiwan 7.40 6.42 7.02 7.67 7.22

 Brazil 11.14 9.42 11.19 10.61 9.05

 Costa Rica 4.86 7.62 8.11 6.16 6.78

 Vietnam 8.92 6.13 5.16 5.25 5.68

 Other2 10.35 11.27 14.16 11.95 14.06

 Average,

nonsubject 6.94 7.23 8.05 7.67 7.51

 Average, all 5.93 6.23 6.89 6.97 6.54

Share of quantity (percent)

China 44.6 44.3 43.9 45.9 49.1

Hong Kong1 0.1 0.1 (3

) (3) (3)

 Subtotal1 44.7 44.4 43.9 45.9 49.1

Nonsubject countries:

 Indonesia 17.2 17.9 16.9 16.0 13.2

 Taiwan 7.3 8.0 7.9 5.7 10.6

 Brazil 8.0 10.5 10.8 10.8 9.8

 Costa Rica 12.6 7.0 6.2 7.1 6.9

 Vietnam 0.5 2.0 6.4 4.4 3.4

 Other2 9.7 10.2 7.9 10.1 7.0

 Subtotal, nonsubject 55.3 55.6 56.1 54.1 50.9

 Total, all countries 100.0 100.0 100.0 100.0 100.0

 1 The petition for the original investigation alleged that cased pencils produced in China were often transhipped

through Hong Kong. Information supplied in questionnaire responses submitted to the Commission supported this

allegation. Therefore, import data for China presented include imports of cased pencils from Hong Kong.

 2 Other primary nonsubject sources were Thailand, Mexico, United Kingdom, India, Czech Republic, Korea, and

Germany.

 3 Less than 0.05 percent.

Source: Official Commerce statistics, HTS statistical reporting number 9609.10.0000.

I-26
Figure I-1

Cased pencils: U.S. imports from China/Hong Kong1

 and all other sources, 1991-2009

 1 The petition for the original investigation alleged that cased pencils produced in China were often transhipped

through Hong Kong. Information supplied in questionnaire responses submitted to the Commission supported this

allegation. Therefore, import data for China presented include imports of cased pencils from Hong Kong.

Note.–Data for years 1994-96 are not available.

Source: Staff Report on Investigation No. 731-TA-669 (Second Review): Cased Pencils from China, INV-CC-185,

October 26, 2005, table I-5 (1991-2004); and compiled from official Commerce statistics, HTS statistical reporting

number 9609.10.0000 (2005-09).

I-27
Indonesia was the second leading supplier of cased pencils to the United States from 2005 to

2009. The average unit values of U.S. imports from Indonesia were consistently lower than the average

unit values of U.S. imports from China from 2005 to 2009, but fluctuated throughout the period from a

low of $3.96 per gross reported in 2006 to a high of $4.71 per gross in 2007. The average unit value of

imports from Indonesia was $4.02 percent in 2009. Indonesia’s share of total U.S. imports fell overall

from 17.2 percent in 2005 to 13.2 percent in 2009. 

Taiwan and Brazil were the third and fourth leading suppliers of imported cased pencils to the

United States during 2005-09. Cased pencils from these two sources have consistently had higher

average unit values than pencils from other leading suppliers, including China and Indonesia. In 2009,

Taiwan’s and Brazil’s shares of total U.S. cased pencil imports were 10.6 percent and 9.8 percent,

respectively.

Ratio of Imports to U.S. Production

Imports of cased pencils from China were equivalent to *** percent of U.S. production in 2009,

compared with *** percent in 2004, *** percent in 1998, and *** percent in 1993. The ratio of imports

of pencils from nonsubject countries to domestic production was *** percent in 2009, compared with ***

percent in 2004, *** percent in 1998, and *** percent in 1993. The ratio of total imports to U.S.

production increased throughout the period and was *** percent in 2009, a substantial increase when

compared with *** percent in 2004, *** percent in 1998, and *** percent in 1993. 

Apparent U.S. Consumption and Market Shares

Apparent U.S. consumption of cased pencils and market shares are presented in table I-9. 

Demand for cased pencils in the United States is reportedly derived from population growth, principally

among school-age children. The U.S. market for cased pencils is described as a mature market with

limited opportunities for extensive growth.79 Since 2004, apparent U.S. consumption for cased pencils

increased by *** percent; however, the share of apparent U.S. consumption held by domestic producers

fell from *** percent in 2004 to *** percent in 2009. U.S. producers lost market share to both subject

imports from China and nonsubject imports from other countries. 

 79 Response of General Pencil, Musgrave Pencil, and Sanford, December 1, 2010, pp. 7, 8, and 12.

I-28
Table I-9

Cased pencils: U.S. producers’ U.S. shipments, U.S. imports, and apparent U.S. consumption,

1991-93, 1998, 2004, and 2009

Item

Original investigation

First

review

Second

review

Third

review

1991 1992 1993 1998 2004 2009

Quantity (1,000 gross)

U.S. shipments of U.S. product *** *** *** ***1 *** ***

U.S. imports from--

 China/Hong Kong:

 Fair value imports *** *** *** (2

) (3) (3)

 LTFV imports *** *** *** (2

) 9,224 10,530

 Subtotal, China/Hong Kong 1,306 3,276 4,724 6,002 9,224 10,530

 Other sources 1,791 1,642 2,009 8,858 9,027 10,904

 Total imports 3,098 4,918 6,734 14,860 18,251 21,434

Apparent U.S. consumption *** *** *** *** *** ***

Share of consumption based on quantity (percent)

U.S. shipments of U.S. product *** *** *** *** *** ***

U.S. imports from--

 China/Hong Kong:

 Fair value imports *** *** *** (2

) (3) (3)

 LTFV imports *** *** *** (2

) *** ***

 Subtotal, China/Hong Kong *** *** *** *** *** ***

 Other sources *** *** *** *** *** ***

 Total imports *** *** *** *** *** ***

Apparent U.S. consumption 100.0 100.0 100.0 100.0 100.0 100.0

 1 ***.

 2

 Not available.

 3

 Not applicable. All cased pencils produced in China are currently subject of the antidumping duty order.

Source: Staff Report on Investigation No. 731-TA-669 (Second Review): Cased Pencils from China, INV-CC-185,

October 26, 2005, table I-7; Response of Dixon Ticonderoga, December 1, 2010, exh. 4; and official Commerce

statistics, HTS statistical reporting number 9609.10.0000.

I-29
ANTIDUMPING ACTIONS OUTSIDE THE UNITED STATES

On October 18, 1994, Mexico imposed a final definitive antidumping duty rate of 451 percent on

imports of pencils produced in China.80 However, in 2008, Mexico and China signed an agreement under

which Mexico committed to eliminate its antidumping duty orders on a broad range of Chinese products. 

Effective October 15, 2008, Mexico’s antidumping duty on pencils imported from China was rescinded

and replaced with a transitional duty, which was to be phased out over a three-year period.81 The semiannual report submitted by Mexico to the World Trade Organization on September 14, 2010, indicated

that there were no antidumping duty measures in force with respect to pencils produced in China.82

According to Global Trade Atlas data, exports of cased pencils from China to Mexico fluctuated from

2005 to 2009. Such exports to Mexico were as follows: 22,477 kilograms ($100,890) in 2005, 18,939

kilograms ($31,351) in 2006, 56,018 kilograms ($115,941) in 2007, 7,358 kilograms ($39,339) in 2008,

and 43,535 kilograms ($221,192) in 2009. Dixon Ticonderoga noted in its response to the Commission’s

notice of institution in this third five-year review that “the conduct of PRC exporters since the revocation

of the antidumping order on cased pencils in Mexico shows that, in the absence of a check against

less-than-fair-value imports, these exporters will substantially increase sales of low-priced pencils in the

U.S. market after revocation.”83

Antidumping duty measures are currently in place in Turkey with respect to “pencils with leads

of graphite and crayons encased in a rigid sheath” produced in China. Such duties were originally

imposed by Turkey on January 14, 2003, and were extended following a review of the antidumping duty

order completed on December 18, 2008. The definitive final antidumping duty rate concerning Turkey’s

imports of such pencils produced in China amounts to $3.16/gross.84 According to Global Trade Atlas

data, exports of pencils from China to Turkey increased from 2005 to 2008, but fell in 2009. Such

exports to Turkey were as follows: 42,513 kilograms ($159,625) in 2005, 99,176 kilograms ($389,096)

in 2006, 119,750 kilograms ($603,085) in 2007, 139,587 kilograms ($530,098) in 2008, and 68,954

kilograms ($309,480) in 2009.

THE SUBJECT INDUSTRY IN CHINA

Although the original staff report did not contain data as to the total number of cased pencil

manufacturers in China at that time, six manufacturers and/or exporters provided information to the

Commission on the Chinese pencil industry in response to questionnaires during the original

investigation.85 However, the Commission did not receive any responses to its notice of institution from

Chinese producers in subsequent reviews of the antidumping duty order. During the first review, the

domestic interested parties identified 16 Chinese producers of cased pencils and, during the second fiveyear review, the domestic interested parties identified 19 Chinese producers of pencils and 19 Chinese

exporters of pencils. 

 80 World Trade Organization, Committee on Anti-Dumping Practices, Semi-Annual Report Under Article 16.4 of

the Agreement–Mexico, June 20, 1995, http://www.wto.org/english/tratop_e/adp_e/adp_e.htm.

 81 Market Profiles - Mexico, http://info.hktdc.com/mktprof/america/mpmex.htm, retrieved January 24, 2011.

 82 World Trade Organization, Committee on Anti-Dumping Practices, Semi-Annual Report Under Article 16.4 of

the Agreement–Mexico, September 14, 2010, http://www.wto.org/english/tratop_e/adp_e/adp_e.htm.

 83 Response of Dixon Ticonderoga, December 1, 2010, p. 6.

 84 World Trade Organization, Committee on Anti-Dumping Practices, Semi-Annual Report Under Article 16.4 of

the Agreement–Turkey, March 5, 2009, http://www.wto.org/english/tratop_e/adp_e/adp_e.htm.

 85 Staff Report on Investigations Nos. 731-TA-669 and 670 (Final): Certain Cased Pencils from the People’s

Republic of China (China) and Thailand, INV-R-147, September 28, 1994, table 15.

I-30
The Commission’s staff report in the second five-year review indicated that, according to a

private market intelligence report published by Global Sources in October 2004 on the writing

instruments industry in China, there were approximately 400 producers of cased pencils in China during

2003. That report noted that pencils (including mechanical pencils) accounted for 31 percent of China’s

exports of writing instruments in 2003. It also stated that producers of writing instruments in China at

that time faced rising costs for labor, raw materials, and electricity but that intense competition from other

producers in China kept them from raising prices on their products. China’s production of all types of

pencils (mechanical pencils, wood cased lead pencils, and wood cased colored pencils) amounted to 8.95

billion pieces (62.2 million gross) in 2003, a 9-percent increase over 2002. China’s exports of wooden

pencils (lead and colored) amounted to 6.08 billion pieces (42.2 million gross) in 2003. One of the largest

exporters in China, Jinan Hangtung, reportedly produced about 1 billion pencils (6.9 million gross) in

2003. The Global Sources 2004 report also noted that low-end pencils in China were made from poplar

wood, used lower quality graphite, and used low-end paint or no paint or lacquer at all; whereas midrange and high-end pencils were made from basswood, used better quality graphite and rare earth

elements, had a lacquered finish, and often were painted with multiple colors. The prices of the low-end

Chinese pencils reportedly ranged from $0.50 to $1.76 per gross and the prices of the mid-range and highend Chinese pencils ranged from $0.93 to $2.18 per gross at that time. The Global Sources report

indicated that Chinese producers of low-end colored pencils used locally sourced talcum, clay, and

pigments that resulted in dull colors, whereas higher quality colored pencils incorporated raw materials

imported from Germany. The Global Sources report added that with rising prices for wood and concern

about the environment, some companies had started to offer pencils made from recycled newspaper.86

Domestic producer Dixon Ticonderoga indicated in its response to the Commission’s notice of

institution in this third five-year review of the antidumping duty order that it has no information

indicating that the total number of producers in China has decreased from the 400-producer estimate

provided for 2003. In fact, the domestic producer argued in its response that, even if there were a change

in the structure of the Chinese industry, the total production capacity in China has increased since the last

review. The producer provided a listing of 74 Chinese exporters of pencils in its response to the

Commission’s notice of institution in this third five-year review.87 Domestic producers Sanford, General

Pencil, and Musgrave Pencil identified 19 Chinese producers of pencils and 20 Chinese exporters of

pencils in their response to the Commission’s notice of institution.88

In its response to the Commission’s notice of institution in this third five-year review, Dixon

Ticonderoga provided certain quantity data concerning the cased pencil industry in China. These data are

presented in table I-10. These data show that cased pencil production in China increased by 33.0 percent

from 2005 to 2009 and that the country’s exports consumed a significant share of its cased pencils

production. In 2009, 27.7 percent of China’s total production of cased pencils was exported. China’s

production of cased pencils in 2009 was estimated at 100.7 million gross. By contrast, the total apparent

U.S. consumption of cased pencils was *** gross in 2009.

 86 Staff Report on Investigation No. 731-TA-669 (Second Review): Cased Pencils from China, INV-CC-185,

October 26, 2005, pp. I-25 and I-26 (citing Global Sources, “Writing Instruments Manufacturing in China,” in

Writing Instruments: Global Sourcing Report, October 2004). There have been no published updates to the Global

Sources report on writing instruments since the original report was issued in 2004.

 87 Response of Dixon Ticonderoga, December 1, 2010, p. 8 and exh. 2.

 88 Response of General Pencil, Musgrave Pencil, and Sanford, December 1, 2010, p. 11.

I-31
Table I-10

Cased pencils: Chinese production, exports, imports, and apparent consumption, 2005-09

Item 2005 2006 2007 2008 2009

Quantity (1,000 gross)

Production 75,694 81,250 90,972 91,667 100,694

Exports 25,055 27,501 30,592 30,732 27,925

Imports 909 876 1,123 693 711

Apparent consumption 51,549 54,625 61,503 61,628 73,481

Note.–Weight to gross conversion factor (1 gross=0.86 kilograms) provided by Dixon Ticonderoga.

Source: China Writing Instruments Association (production) and Global Trade Information Services (imports and

exports), as provided in Response of Dixon Ticonderoga, December 1, 2010, exh. 6.

In their responses, the domestic producers argued that the increases in the volume of U.S. imports

of cased pencils from China indicate that there has been a dramatic expansion of production and export

capacity in China over the past several years. They stated that China’s substantial cased pencils

production capacity is a result of many years of state control and of an economic policy of promoting

local processing of raw materials, including China’s indigenous supplies of basswood. They estimated

that the capacity to produce cased pencils in China was at least 104 million gross in 2010, an increase of

36.8 percent from the 76 million gross capacity level reported at the end of the previous period of review. 

They stated further that the United States is a prime destination for the growing Chinese cased pencil

industry because of significantly higher prices in the United States compared with the Chinese market and

other export markets.89

Table I-11 presents official Chinese export statistics (as compiled by Global Trade Information

Services) on Chinese cased pencil exports, by market, during 2005-09.90 These data show that from 2005

to 2009, the quantity of China’s total exports of cased pencils increased by 11.5 percent, rising from 38.8

million gross to 43.3 million gross. The United States was consistently China’s largest export market for

cased pencils, accounting for 25.1 percent (10.9 million gross) of China’s exports in 2009.

 89 Response of Dixon Ticonderoga, December 1, 2010, pp. 6, 9, and 12; and Response of General Pencil,

Musgrave Pencil, and Sanford, December 1, 2010, p. 6.

 90 These data were provided by Dixon Ticonderoga in its response to the Commission’s notice of institution in

this third five-year review of the antidumping duty order. Note that the export data provided by Dixon Ticonderoga

and presented in table I-10 and table I-11 of this report differ even though the source cited is the same (Global Trade

Information Services). One difference between the two export quantity presentations in Dixon Ticonderoga’s

response noted by Commission staff is the difference in the conversion factor used, as indicated in the tables.

I-32
Table I-11

Cased pencils: Chinese exports, by market, 2005-09

Market 2005 2006 2007 2008 2009

Quantity (1,000 gross)

United States 10,362 12,503 12,918 12,441 10,850

Taiwan 2,532 3,000 2,936 3,108 4,219

United Kingdom 1,470 2,043 2,157 2,212 1,799

India 726 818 946 1,456 1,692

Indonesia 2,069 2,173 1,797 1,702 1,631

Pakistan 659 1,030 1,496 1,553 1,433

Malaysia 854 1,048 1,067 1,398 1,116

United Arab Emirates 1,244 959 1,441 1,683 1,028

Korea 947 1,008 1,014 1,012 963

Thailand 801 633 957 897 853

Nigeria 936 627 950 1,408 785

South Africa 499 528 503 579 783

Germany 673 782 810 892 779

Sweden 656 599 730 723 768

Canada 641 1,008 1,072 1,061 729

All other 13,772 13,876 16,634 15,521 13,866

 Total, world 38,843 42,636 47,428 47,645 43,293

Table continued on following page.

I-33
Table I-11--Continued

Cased pencils: Chinese exports, by market, 2005-09

Market 2005 2006 2007 2008 2009

Value (1,000 dollars)

United States 22,423 27,298 31,584 35,301 33,274

Taiwan 4,171 5,405 6,010 6,679 9,256

United Kingdom 3,033 4,117 4,906 5,524 4,857

India 1,127 1,679 2,689 4,517 5,027

Indonesia 3,105 3,561 3,265 3,401 3,345

Pakistan 1,632 2,004 3,149 3,410 4,243

Malaysia 1,750 2,046 2,413 3,542 2,786

United Arab Emirates 1,822 1,591 3,305 3,887 2,869

Korea 2,241 2,512 2,880 3,296 3,434

Thailand 1,369 1,207 1,794 1,873 1,904

Nigeria 1,015 896 1,410 2,373 1,241

South Africa 844 951 981 1,327 1,742

Germany 1,561 1,813 2,150 2,775 2,453

Sweden 1,093 826 1,112 1,374 1,554

Canada 1,326 2,206 2,789 3,161 2,284

All other 23,115 26,761 36,807 40,249 37,405

 Total, world 71,629 84,873 107,243 122,688 117,674

Table continued on following page.

I-34
Table I-11--Continued

Cased pencils: Chinese exports, by market, 2005-09

Market 2005 2006 2007 2008 2009

Unit value (per gross)

United States $2.16 $2.18 $2.44 $2.84 $3.07

Taiwan 1.65 1.80 2.05 2.15 2.19

United Kingdom 2.06 2.02 2.27 2.50 2.70

India 1.55 2.05 2.84 3.10 2.97

Indonesia 1.50 1.64 1.82 2.00 2.05

Pakistan 2.48 1.95 2.11 2.20 2.96

Malaysia 2.05 1.95 2.26 2.53 2.50

United Arab Emirates 1.46 1.66 2.29 2.31 2.79

Korea 2.37 2.49 2.84 3.26 3.56

Thailand 1.71 1.91 1.87 2.09 2.23

Nigeria 1.08 1.43 1.48 1.69 1.58

South Africa 1.69 1.80 1.95 2.29 2.22

Germany 2.32 2.32 2.66 3.11 3.15

Sweden 1.67 1.38 1.52 1.90 2.02

Canada 2.07 2.19 2.60 2.98 3.13

All other 1.68 1.93 2.21 2.59 2.70

 Total, world 1.84 1.99 2.26 2.58 2.72

Table continued on following page.

I-35
Table I-11--Continued

Cased pencils: Chinese exports, by market, 2005-09

Market 2005 2006 2007 2008 2009

Share of quantity (percent)

United States 26.7 29.3 27.2 26.1 25.1

Taiwan 6.5 7.0 6.2 6.5 9.7

United Kingdom 3.8 4.8 4.5 4.6 4.2

India 1.9 1.9 2.0 3.1 3.9

Indonesia 5.3 5.1 3.8 3.6 3.8

Pakistan 1.7 2.4 3.2 3.3 3.3

Malaysia 2.2 2.5 2.2 2.9 2.6

United Arab Emirates 3.2 2.3 3.0 3.5 2.4

Korea 2.4 2.4 2.1 2.1 2.2

Thailand 2.1 1.5 2.0 1.9 2.0

Nigeria 2.4 1.5 2.0 3.0 1.8

South Africa 1.3 1.2 1.1 1.2 1.8

Germany 1.7 1.8 1.7 1.9 1.8

Sweden 1.7 1.4 1.5 1.5 1.8

Canada 1.6 2.4 2.3 2.2 1.7

All other 35.5 32.5 35.1 32.6 32.0

 Total, world 100.0 100.0 100.0 100.0 100.0

Note.–Weight to gross conversion factor (1 gross=0.75 kilograms) based on actual weight of 12 SPARCO #2 pencils.

Source: Official Chinese export statistics compiled by Global Trade Information Services, as provided in Response

of Dixon Ticonderoga, December 1, 2010, exh. 7.

I-36
THE GLOBAL MARKET

Tables I-12 and I-13 present Global Trade Atlas data on world exports and imports, by value,

from 2005 to 2009.91 These data show that China is, by far, the world’s largest supplier of cased pencils,

representing more than one-third of total world exports (in terms of value) in 2009. The United States, on

the other hand, is among the world’s largest markets for cased pencils consumption and is the single

largest export market for Chinese cased pencils. The United States represented one-fifth of global

imports of cased pencils (in terms of value) in 2009.

Table I-12

Cased pencils: World exports, by source, 2005-09

Source 2005 2006 2007 2008 2009

Value (1,000 dollars)

China 136,405 163,107 206,778 229,730 217,364

Germany 73,045 87,846 100,096 120,536 95,296

Brazil 40,066 47,907 52,889 54,036 46,176

Indonesia 40,622 48,560 53,414 49,051 44,976

Czech Republic 20,255 20,747 22,711 37,641 29,561

France 14,574 12,242 17,994 22,329 19,629

Taiwan 13,756 15,078 15,384 16,075 18,075

Thailand 17,453 18,185 16,708 17,700 17,995

Mexico 4,116 10,825 13,210 13,823 13,874

Netherlands 12,685 12,444 14,374 14,564 13,685

United Kingdom 9,670 14,814 14,983 16,663 12,945

United States 16,182 13,078 15,611 16,978 11,977

Costa Rica 11,976 12,235 12,579 9,706 10,746

All other 78,429 75,997 92,665 90,404 87,835

 Total1 489,233 553,066 649,397 709,237 640,135

 1 2005-08 data are not available for Iran and United Arab Emirates. 2005 data are not available for Kenya. 

Therefore, totals presented are understated for 2005-08.

Source: Global Trade Atlas (HTS subheading 9609.10).

 91 Because the units of quantity reported by each country for exports and imports vary, quantity data are not

presented.

I-37
Table I-13

Cased pencils: World imports, by market, 2005-09

Market 2005 2006 2007 2008 2009

Value (1,000 dollars)

United States 109,000 128,342 149,150 138,576 130,144

United Kingdom 32,331 34,041 36,907 41,735 46,000

Germany 31,190 38,978 43,596 48,064 43,319

Italy 24,007 25,367 26,997 30,899 27,899

France 21,059 22,447 27,957 30,950 24,839

Mexico 18,240 17,016 36,275 35,463 24,480

Canada 19,733 19,755 20,211 22,799 19,569

Netherlands 12,949 13,802 15,469 16,614 16,097

Japan 12,010 17,849 17,239 17,246 14,573

Australia 10,480 11,195 11,208 13,458 13,713

Taiwan 6,513 7,648 7,516 9,485 13,554

Spain 12,924 14,119 17,188 17,369 12,455

Czech Republic 3,411 3,322 6,809 13,241 12,198

South Korea 10,299 11,839 14,331 14,613 11,862

All other 173,629 191,955 220,280 240,102 238,900

 Total1 497,775 557,674 651,132 690,615 649,600

 1 2005-08 data are not available for Iran and United Arab Emirates. 2005-06 data are not available for Nigeria

and Yemen. 2005 data are not available for Kenya. Therefore, totals presented are understated for 2005-08.

Source: Global Trade Atlas (HTS subheading 9609.10).

I-38
APPENDIX A

FEDERAL REGISTER NOTICES

A-1

67082 Federal Register / Vol. 75, No. 210 / Monday, November 1, 2010 / Notices 

adopted by the Board (74 FR 1170, 

1/12/09; correction 74 FR 3987, 1/22/ 

09). The ASF is an option for grantees 

for the establishment or reorganization 

of general-purpose zones and can permit 

significantly greater flexibility in the 

designation of new ‘‘usage-driven’’ FTZ 

sites for operators/users located within 

a grantee’s ‘‘service area’’ in the context 

of the Board’s standard 2,000-acre 

activation limit for a general-purpose 

zone project. The application was 

submitted pursuant to the Foreign-Trade 

Zones Act, as amended (19 U.S.C. 81a– 

81u), and the regulations of the Board 

(15 CFR part 400). It was formally filed 

on October 26, 2010. 

FTZ 176 was approved by the Board 

on March 1, 1991 (Board Order 511, 56 

FR 10409, 3/12/91) and expanded on 

February 9, 2005 (Board Order 1368, 70 

FR 9613, 2/28/05), August 3, 2006 

(Board Order 1473, 71 FR 47483, 8/17/ 

06) and on January 30, 2009 (Board 

Order 1603, 74 FR 6570, 2/10/09). FTZ 

176 was reorganized under the ASF on 

August 19, 2010 (Board Order 1702, 75 

FR 52511–52512, 8/26/2010). 

The zone project currently has a 

service area that includes Winnebago, 

Stephenson, Ogle, Lee, DeKalb, and 

Boone Counties, and portions of Bureau, 

McHenry and Kane Counties, Illinois. 

The applicant is requesting authority 

to expand the service area of the zone 

to include portions of LaSalle and 

Putnam Counties, as described in the 

application. If approved, the grantee 

would be able to serve sites throughout 

the expanded service area based on 

companies’ needs for FTZ designation. 

The proposed expanded service area is 

adjacent to the Rockford Customs and 

Border Protection port of entry. 

In accordance with the Board’s 

regulations, Elizabeth Whiteman of the 

FTZ Staff is designated examiner to 

evaluate and analyze the facts and 

information presented in the application 

and case record and to report findings 

and recommendations to the Board. 

Public comment is invited from 

interested parties. Submissions (original 

and 3 copies) shall be addressed to the 

Board’s Executive Secretary at the 

address below. The closing period for 

their receipt is January 3, 2011. Rebuttal 

comments in response to material 

submitted during the foregoing period 

may be submitted during the subsequent 

15-day period to January 18, 2011. 

A copy of the application will be 

available for public inspection at the 

Office of the Executive Secretary, 

Foreign-Trade Zones Board, Room 2111, 

U.S. Department of Commerce, 1401 

Constitution Avenue, NW., Washington, 

DC 20230–0002, and in the ‘‘Reading 

Room’’ section of the Board’s Web site, 

which is accessible via http://www.

trade.gov/ftz. For further information, 

contact Elizabeth Whiteman at 

Elizabeth.Whiteman@trade.gov or (202) 

482–0473. 

Dated: October 26, 2010. 

Andrew McGilvray, 

Executive Secretary. 

[FR Doc. 2010–27520 Filed 10–29–10; 8:45 am] 

BILLING CODE P 

DEPARTMENT OF COMMERCE 

International Trade Administration 

Initiation of Five-Year (‘‘Sunset’’) 

Review 

AGENCY: Import Administration, 

International Trade Administration, 

Department of Commerce. 

SUMMARY: In accordance with section 

751(c) of the Tariff Act of 1930, as 

amended (‘‘the Act’’), the Department of 

Commerce (‘‘the Department’’) is 

automatically initiating a five-year 

review (‘‘Sunset Review’’) of the 

antidumping and countervailing duty 

orders listed below. The International 

Trade Commission (‘‘the Commission’’) 

is publishing concurrently with this 

notice its notice of Institution of FiveYear Review which covers the same 

orders. 

DATES: Effective Date: November 1, 

2010. 

FOR FURTHER INFORMATION CONTACT: The 

Department official identified in the 

Initiation of Review section below at 

AD/CVD Operations, Import 

Administration, International Trade 

Administration, U.S. Department of 

Commerce, 14th Street and Constitution 

Avenue, NW., Washington, DC 20230. 

For information from the Commission 

contact Mary Messer, Office of 

Investigations, U.S. International Trade 

Commission at (202) 205–3193. 

SUPPLEMENTARY INFORMATION: 

Background 

The Department’s procedures for the 

conduct of Sunset Reviews are set forth 

in its Procedures for Conducting Fiveyear (‘‘Sunset’’) Reviews of Antidumping 

and Countervailing Duty Orders, 63 FR 

13516 (March 20, 1998) and 70 FR 

62061 (October 28, 2005). Guidance on 

methodological or analytical issues 

relevant to the Department’s conduct of 

Sunset Reviews is set forth in the 

Department’s Policy Bulletin 98.3— 

Policies Regarding the Conduct of FiveYear (‘‘Sunset’’) Reviews of Antidumping 

and Countervailing Duty Orders: Policy 

Bulletin, 63 FR 18871 (April 16, 1998). 

Initiation of Review 

In accordance with 19 CFR 

351.218(c), we are initiating the Sunset 

Review of the following antidumping 

and countervailing duty orders: 

DOC case No. ITC case No. Country Product Department contact 

A–533–817 ......... 731–TA–817 ...... India ......................... Certain Cut-to-Length Carbon-Quality 

Steel Plate (2nd Review).

David Goldberger (202) 482–4136. 

A–560–805 ......... 731–TA–818 ...... Indonesia .................. Certain Cut-to-Length Carbon-Quality 

Steel Plate (2nd Review).

David Goldberger (202) 482–4136. 

A–475–826 ......... 731–TA–819 ...... Italy ........................... Certain Cut-to-Length Carbon-Quality 

Steel Plate (2nd Review).

David Goldberger (202) 482–4136. 

A–588–847 ......... 731–TA–820 ...... Japan ....................... Certain Cut-to-Length Carbon-Quality 

Steel Plate (2nd Review).

David Goldberger (202) 482–4136. 

A–580–836 ......... 731–TA–821 ...... South Korea ............. Certain Cut-to-Length Carbon-Quality 

Steel Plate (2nd Review).

David Goldberger (202) 482–4136. 

A–475–703 ......... 731–TA–385 ...... Italy ........................... Certain Cut-to-Length Carbon-Quality 

Steel Plate (3rd Review).

David Goldberger (202) 482–4136. 

A–588–707 ......... 731–TA–386 ...... Japan ....................... Granular Polytetraflouroethylene (3rd Review).David Goldberger (202) 482–4136. 

A–588–866 ......... 731–TA–1090 .... Japan ....................... Superalloy Degassed Chromium ................ Dana Mermelstein (202) 482–1391. 

A–570–827 ......... 731–TA–669 ...... PRC .......................... Cased Pencils (3rd Review) ....................... David Goldberger (202) 482–4136. 

A–570–804 ......... 731–TA–464 ...... PRC .......................... Sparklers (3rd Review) ............................... Jennifer Moats (202) 482–5047. 

A–533–809 ......... 731–TA–639 ...... India ......................... Forged Stainless Steel Flanges (3rd Review).Dana Mermelstein (202) 482–1391. 

mstockstill on DSKH9S0YB1PROD with NOTICES

Federal Register / Vol. 75, No. 210 / Monday, November 1, 2010 / Notices 67083 

1 In comments made on the interim final sunset 

regulations, a number of parties stated that the 

proposed five-day period for rebuttals to 

substantive responses to a notice of initiation was 

insufficient. This requirement was retained in the 

final sunset regulations at 19 CFR 351.218(d)(4). As 

provided in 19 CFR 351.302(b), however, the 

Department will consider individual requests to 

extend that five-day deadline based upon a showing 

of good cause. 

DOC case No. ITC case No. Country Product Department contact 

A–583–821 ......... 731–TA–640 ...... Taiwan ...................... Forged Stainless Steel Flanges (3rd Review).Dana Mermelstein (202) 482–1391. 

C–533–818 ........ 701–TA–388 ...... India ......................... Certain Cut-to-Length Carbon-Quality 

Steel Plate (2nd Review).

David Goldberger (202) 482–4136. 

C–560–806 ........ 701–TA–389 ...... Indonesia .................. Certain Cut-to-Length Carbon-Quality 

Steel Plate (2nd Review).

David Goldberger (202) 482–4136. 

C–475–827 ........ 701–TA–390 ...... Italy ........................... Certain Cut-to-Length Carbon- Quality 

Steel Plate (2nd Review).

David Goldberger (202) 482–4136. 

C–580–837 ........ 701–TA–391 ...... South Korea ............. Certain Cut-to-Length Carbon-Quality 

Steel Plate (2nd Review).

David Goldberger (202) 482–4136. 

Filing Information 

As a courtesy, we are making 

information related to Sunset 

proceedings, including copies of the 

pertinent statute and Department’s 

regulations, the Department schedule 

for Sunset Reviews, a listing of past 

revocations and continuations, and 

current service lists, available to the 

public on the Department’s Internet 

Web site at the following address: 

‘‘http://ia.ita.doc.gov/sunset/.’’ All 

submissions in these Sunset Reviews 

must be filed in accordance with the 

Department’s regulations regarding 

format, translation, service, and 

certification of documents. These rules 

can be found at 19 CFR 351.303. 

Pursuant to 19 CFR 351.103(c), the 

Department will maintain and make 

available a service list for these 

proceedings. To facilitate the timely 

preparation of the service list(s), it is 

requested that those seeking recognition 

as interested parties to a proceeding 

contact the Department in writing 

within 10 days of the publication of the 

Notice of Initiation. 

Because deadlines in Sunset Reviews 

can be very short, we urge interested 

parties to apply for access to proprietary 

information under administrative 

protective order (‘‘APO’’) immediately 

following publication in the Federal 

Register of this notice of initiation by 

filing a notice of intent to participate. 

The Department’s regulations on 

submission of proprietary information 

and eligibility to receive access to 

business proprietary information under 

APO can be found at 19 CFR 351.304– 

306. 

Information Required From Interested 

Parties 

Domestic interested parties defined in 

section 771(9)(C), (D), (E), (F), and (G) of 

the Act and 19 CFR 351.102(b)) wishing 

to participate in a Sunset Review must 

respond not later than 15 days after the 

date of publication in the Federal 

Register of this notice of initiation by 

filing a notice of intent to participate. 

The required contents of the notice of 

intent to participate are set forth at 19 

CFR 351.218(d)(1)(ii). In accordance 

with the Department’s regulations, if we 

do not receive a notice of intent to 

participate from at least one domestic 

interested party by the 15-day deadline, 

the Department will automatically 

revoke the order without further review. 

See 19 CFR 351.218(d)(1)(iii). 

If we receive an order-specific notice 

of intent to participate from a domestic 

interested party, the Department’s 

regulations provide that all parties 

wishing to participate in the Sunset 

Review must file complete substantive 

responses not later than 30 days after 

the date of publication in the Federal 

Register of this notice of initiation. The 

required contents of a substantive 

response, on an order-specific basis, are 

set forth at 19 CFR 351.218(d)(3). Note 

that certain information requirements 

differ for respondent and domestic 

parties. Also, note that the Department’s 

information requirements are distinct 

from the Commission’s information 

requirements. Please consult the 

Department’s regulations for 

information regarding the Department’s 

conduct of Sunset Reviews.1 Please 

consult the Department’s regulations at 

19 CFR part 351 for definitions of terms 

and for other general information 

concerning antidumping and 

countervailing duty proceedings at the 

Department. 

This notice of initiation is being 

published in accordance with section 

751(c) of the Act and 19 CFR 351.218 

(c). 

Dated: October 27, 2010. 

Susan H. Kuhbach, 

Acting Deputy Assistant Secretary for 

Antidumping and Countervailing Duty 

Operations. 

[FR Doc. 2010–27522 Filed 10–29–10; 8:45 am] 

BILLING CODE 3510–DS–P 

DEPARTMENT OF COMMERCE 

National Oceanic and Atmospheric 

Administration 

RIN 0684–XZ34 

Magnuson-Stevens Act Provisions; 

General Provisions for Domestic 

Fisheries; Application for Exempted 

Fishing Permit 

AGENCY: National Marine Fisheries 

Service (NMFS), National Oceanic and 

Atmospheric Administration (NOAA), 

Commerce. 

ACTION: Notice; request for comments. 

SUMMARY: The Assistant Regional 

Administrator for Sustainable Fisheries, 

Northeast Region, NMFS, has made a 

preliminary determination that the 

subject exempted fishing permit (EFP) 

application contains all the required 

information and warrants further 

consideration. The subject EFP would 

allow commercial fishing vessels to 

conduct fishing operations that are 

otherwise restricted by the regulations 

governing the fisheries of the 

Northeastern United States. Regulations 

under the Magnuson-Stevens Fishery 

Conservation and Management Act 

require publication of this notification 

to provide interested parties the 

opportunity to comment on applications 

for proposed EFPs. 

DATES: Comments must be received on 

or before November 16, 2010. 

ADDRESSES: Comments may be 

submitted by e-mail to 

NERO.EFP@noaa.gov. Written 

comments should be sent to Patricia A. 

Kurkul, Regional Administrator, NMFS, 

Northeast Regional Office, 55 Great 

Republic Drive, Gloucester, MA 01930. 

Mark the outside of the envelope 

‘‘Comments on the SNE Flatfish Discard 

Mortality EFP.’’ Comments may also be 

sent via facsimile (fax) to (978) 281– 

9135. 

FOR FURTHER INFORMATION CONTACT: 

Melissa Vasquez, Fishery Policy 

Analyst, (978) 281–9166, fax (978) 281– 

9135. 

mstockstill on DSKH9S0YB1PROD with NOTICES

67102 Federal Register / Vol. 75, No. 210 / Monday, November 1, 2010 / Notices 

imports of Subject Merchandise on the 

Domestic Industry. 

(5) A list of all known and currently 

operating U.S. producers of the 

Domestic Like Product. Identify any 

known related parties and the nature of 

the relationship as defined in section 

771(4)(B) of the Act (19 U.S.C. 

1677(4)(B)). 

(6) A list of all known and currently 

operating U.S. importers of the Subject 

Merchandise and producers of the 

Subject Merchandise in the Subject 

Country that currently export or have 

exported Subject Merchandise to the 

United States or other countries since 

the Order Date. 

(7) A list of 3–5 leading purchasers in 

the U.S. market for the Domestic Like 

Product and the Subject Merchandise 

(including street address, World Wide 

Web address, and the name, telephone 

number, fax number, and E-mail address 

of a responsible official at each firm). 

(8) A list of known sources of 

information on national or regional 

prices for the Domestic Like Product or 

the Subject Merchandise in the U.S. or 

other markets. 

(9) If you are a U.S. producer of the 

Domestic Like Product, provide the 

following information on your firm’s 

operations on that product during 

calendar year 2009, except as noted 

(report quantity data in pounds and 

value data in U.S. dollars, f.o.b. plant). 

If you are a union/worker group or 

trade/business association, provide the 

information, on an aggregate basis, for 

the firms in which your workers are 

employed/which are members of your 

association. 

(a) Production (quantity) and, if 

known, an estimate of the percentage of 

total U.S. production of the Domestic 

Like Product accounted for by your 

firm’s(s’) production; 

(b) Capacity (quantity) of your firm to 

produce the Domestic Like Product (i.e., 

the level of production that your 

establishment(s) could reasonably have 

expected to attain during the year, 

assuming normal operating conditions 

(using equipment and machinery in 

place and ready to operate), normal 

operating levels (hours per week/weeks 

per year), time for downtime, 

maintenance, repair, and cleanup, and a 

typical or representative product mix); 

(c) The quantity and value of U.S. 

commercial shipments of the Domestic 

Like Product produced in your U.S. 

plant(s); 

(d) The quantity and value of U.S. 

internal consumption/company 

transfers of the Domestic Like Product 

produced in your U.S. plant(s); and 

(e) The value of (i) net sales, (ii) cost 

of goods sold (COGS), (iii) gross profit, 

(iv) selling, general and administrative 

(SG&A) expenses, and (v) operating 

income of the Domestic Like Product 

produced in your U.S. plant(s) (include 

both U.S. and export commercial sales, 

internal consumption, and company 

transfers) for your most recently 

completed fiscal year (identify the date 

on which your fiscal year ends). 

(10) If you are a U.S. importer or a 

trade/business association of U.S. 

importers of the Subject Merchandise 

from the Subject Country, provide the 

following information on your firm’s(s’) 

operations on that product during 

calendar year 2009 (report quantity data 

in pounds and value data in U.S. 

dollars). If you are a trade/business 

association, provide the information, on 

an aggregate basis, for the firms which 

are members of your association. 

(a) The quantity and value (landed, 

duty-paid but not including 

antidumping duties) of U.S. imports 

and, if known, an estimate of the 

percentage of total U.S. imports of 

Subject Merchandise from the Subject 

Country accounted for by your firm’s(s’) 

imports; 

(b) The quantity and value (f.o.b. U.S. 

port, including antidumping duties) of 

U.S. commercial shipments of Subject 

Merchandise imported from the Subject 

Country; and 

(c) The quantity and value (f.o.b. U.S. 

port, including antidumping duties) of 

U.S. internal consumption/company 

transfers of Subject Merchandise 

imported from the Subject Country. 

(11) If you are a producer, an exporter, 

or a trade/business association of 

producers or exporters of the Subject 

Merchandise in the Subject Country, 

provide the following information on 

your firm’s(s’) operations on that 

product during calendar year 2009 

(report quantity data in pounds and 

value data in U.S. dollars, landed and 

duty-paid at the U.S. port but not 

including antidumping duties). If you 

are a trade/business association, provide 

the information, on an aggregate basis, 

for the firms which are members of your 

association. 

(a) Production (quantity) and, if 

known, an estimate of the percentage of 

total production of Subject Merchandise 

in the Subject Country accounted for by 

your firm’s(s’) production; 

(b) Capacity (quantity) of your firm to 

produce the Subject Merchandise in the 

Subject Country (i.e., the level of 

production that your establishment(s) 

could reasonably have expected to 

attain during the year, assuming normal 

operating conditions (using equipment 

and machinery in place and ready to 

operate), normal operating levels (hours 

per week/weeks per year), time for 

downtime, maintenance, repair, and 

cleanup, and a typical or representative 

product mix); and 

(c) The quantity and value of your 

firm’s(s’) exports to the United States of 

Subject Merchandise and, if known, an 

estimate of the percentage of total 

exports to the United States of Subject 

Merchandise from the Subject Country 

accounted for by your firm’s(s’) exports. 

(12) Identify significant changes, if 

any, in the supply and demand 

conditions or business cycle for the 

Domestic Like Product that have 

occurred in the United States or in the 

market for the Subject Merchandise in 

the Subject Country since the Order 

Date, and significant changes, if any, 

that are likely to occur within a 

reasonably foreseeable time. Supply 

conditions to consider include 

technology; production methods; 

development efforts; ability to increase 

production (including the shift of 

production facilities used for other 

products and the use, cost, or 

availability of major inputs into 

production); and factors related to the 

ability to shift supply among different 

national markets (including barriers to 

importation in foreign markets or 

changes in market demand abroad). 

Demand conditions to consider include 

end uses and applications; the existence 

and availability of substitute products; 

and the level of competition among the 

Domestic Like Product produced in the 

United States, Subject Merchandise 

produced in the Subject Country, and 

such merchandise from other countries. 

(13) (OPTIONAL) A statement of 

whether you agree with the above 

definitions of the Domestic Like Product 

and Domestic Industry; if you disagree 

with either or both of these definitions, 

please explain why and provide 

alternative definitions. 

Authority: This review is being conducted 

under authority of title VII of the Tariff Act 

of 1930; this notice is published pursuant to 

section 207.61 of the Commission’s rules. 

By order of the Commission. 

Issued: October 26, 2010. 

Marilyn R. Abbott, 

Secretary to the Commission. 

[FR Doc. 2010–27444 Filed 10–29–10; 8:45 am] 

BILLING CODE 7020–02–P 

INTERNATIONAL TRADE 

COMMISSION 

[Investigation No. 731–TA–669 (Third 

Review)] 

Cased Pencils From China 

AGENCY: United States International 

Trade Commission. 

mstockstill on DSKH9S0YB1PROD with NOTICES

Federal Register / Vol. 75, No. 210 / Monday, November 1, 2010 / Notices 67103 

1No response to this request for information is 

required if a currently valid Office of Management 

and Budget (OMB) number is not displayed; the 

OMB number is 3117–0016/USITC No. 11–5–228, 

expiration date June 30, 2011. Public reporting 

burden for the request is estimated to average 15 

hours per response. Please send comments 

regarding the accuracy of this burden estimate to 

the Office of Investigations, U.S. International Trade 

Commission, 500 E Street, SW., Washington, DC 

20436. 

ACTION: Institution of a five-year review 

concerning the antidumping duty order 

on cased pencils from China. 

SUMMARY: The Commission hereby gives 

notice that it has instituted a review 

pursuant to section 751(c) of the Tariff 

Act of 1930 (19 U.S.C. 1675(c)) (the Act) 

to determine whether revocation of the 

antidumping duty order on cased 

pencils from China would be likely to 

lead to continuation or recurrence of 

material injury. Pursuant to section 

751(c)(2) of the Act, interested parties 

are requested to respond to this notice 

by submitting the information specified 

below to the Commission; 1 to be 

assured of consideration, the deadline 

for responses is December 1, 2010. 

Comments on the adequacy of responses 

may be filed with the Commission by 

January 14, 2011. For further 

information concerning the conduct of 

this review 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, D, E, and 

F (19 CFR part 207), as most recently 

amended at 74 FR 2847 (January 16, 

2009). 

DATES: Effective Date: November 1, 

2010. 

FOR FURTHER INFORMATION CONTACT: 

Mary Messer (202–205–3193), 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 review may be viewed on the 

Commission’s electronic docket (EDIS) 

at http://edis.usitc.gov. 

SUPPLEMENTARY INFORMATION: 

Background.—On December 28, 1994, 

the Department of Commerce 

(‘‘Commerce’’) issued an antidumping 

duty order on imports of cased pencils 

from China (59 FR 66909). Following 

first five-year reviews by Commerce and 

the Commission, effective August 10, 

2000, Commerce issued a continuation 

of the antidumping duty order on 

imports of cased pencils from China (65 

FR 48960). Following second five-year 

reviews by Commerce and the 

Commission, effective December 20, 

2005, Commerce issued a second 

continuation of the antidumping duty 

order on imports of cased pencils from 

China (70 FR 75450). The Commission 

is now conducting a third review to 

determine whether revocation of the 

order would be likely to lead to 

continuation or recurrence of material 

injury to the domestic industry within 

a reasonably foreseeable time. It will 

assess the adequacy of interested party 

responses to this notice of institution to 

determine whether to conduct a full 

review or an expedited review. The 

Commission’s determination in any 

expedited review will be based on the 

facts available, which may include 

information provided in response to this 

notice. 

Definitions.—The following 

definitions apply to this review: 

(1) Subject Merchandise is the class or 

kind of merchandise that is within the 

scope of the five-year review, as defined 

by Congress. 

(2) The Subject Country in this review 

is China. 

(3) The Domestic Like Product is the 

domestically produced product or 

products which are like, or in the 

absence of like, most similar in 

characteristics and uses with, the 

Subject Merchandise. In its original 

determination and its expedited first 

and second five-year review 

determinations, the Commission 

defined the Domestic Like Product as all 

cased pencils, coextensive with 

Commerce’s scope. 

(4) The Domestic Industry is the U.S. 

producers as a whole of the Domestic 

Like Product, or those producers whose 

collective output of the Domestic Like 

Product constitutes a major proportion 

of the total domestic production of the 

product. In its original determination 

and its expedited first and second fiveyear review determinations, the 

Commission defined the Domestic 

Industry as all domestic producers of 

cased pencils. In its original 

determination, the Commission 

excluded one domestic producer, 

Pentech, from the Domestic Industry 

under the related parties provision. 

(5) An Importer is any person or firm 

engaged, either directly or through a 

parent company or subsidiary, in 

importing the Subject Merchandise into 

the United States from a foreign 

manufacturer or through its selling 

agent. 

Participation in the review and public 

service list.—Persons, including 

industrial users of the Subject 

Merchandise and, if the merchandise is 

sold at the retail level, representative 

consumer organizations, wishing to 

participate in the review as parties must 

file an entry of appearance with the 

Secretary to the Commission, as 

provided in section 201.11(b)(4) of the 

Commission’s rules, no later than 21 

days after publication of this notice in 

the Federal Register. The Secretary will 

maintain a public service list containing 

the names and addresses of all persons, 

or their representatives, who are parties 

to the review. 

Former Commission employees who 

are seeking to appear in Commission 

five-year reviews are advised that they 

may appear in a review even if they 

participated personally and 

substantially in the corresponding 

underlying original investigation. The 

Commission’s designated agency ethics 

official has advised that a five-year 

review is not considered the ‘‘same 

particular matter’’ as the corresponding 

underlying original investigation for 

purposes of 18 U.S.C. 207, the post 

employment statute for Federal 

employees, and Commission rule 

201.15(b) (19 CFR 201.15(b)), 73 FR 

24609 (May 5, 2008). This advice was 

developed in consultation with the 

Office of Government Ethics. 

Consequently, former employees are not 

required to seek Commission approval 

to appear in a review under Commission 

rule 19 CFR 201.15, even if the 

corresponding underlying original 

investigation was pending when they 

were Commission employees. For 

further ethics advice on this matter, 

contact Carol McCue Verratti, Deputy 

Agency Ethics Official, at 202–205– 

3088. 

Limited disclosure of business 

proprietary information (BPI) under an 

administrative protective order (APO) 

and APO service list.—Pursuant to 

section 207.7(a) of the Commission’s 

rules, the Secretary will make BPI 

submitted in this review available to 

authorized applicants under the APO 

issued in the review, provided that the 

application is made no later than 21 

days after publication of this notice in 

the Federal Register. Authorized 

applicants must represent interested 

parties, as defined in 19 U.S.C. 1677(9), 

who are parties to the review. A 

separate service list will be maintained 

by the Secretary for those parties 

authorized to receive BPI under the 

APO. 

mstockstill on DSKH9S0YB1PROD with NOTICES

67104 Federal Register / Vol. 75, No. 210 / Monday, November 1, 2010 / Notices 

Certification.—Pursuant to section 

207.3 of the Commission’s rules, any 

person submitting information to the 

Commission in connection with this 

review must certify that the information 

is accurate and complete to the best of 

the submitter’s knowledge. In making 

the certification, the submitter will be 

deemed to consent, unless otherwise 

specified, for the Commission, its 

employees, and contract personnel to 

use the information provided in any 

other reviews or investigations of the 

same or comparable products which the 

Commission conducts under Title VII of 

the Act, or in internal audits and 

investigations relating to the programs 

and operations of the Commission 

pursuant to 5 U.S.C. Appendix 3. 

Written submissions.—Pursuant to 

section 207.61 of the Commission’s 

rules, each interested party response to 

this notice must provide the information 

specified below. The deadline for filing 

such responses is December 1, 2010. 

Pursuant to section 207.62(b) of the 

Commission’s rules, eligible parties (as 

specified in Commission rule 

207.62(b)(1)) may also file comments 

concerning the adequacy of responses to 

the notice of institution and whether the 

Commission should conduct an 

expedited or full review. The deadline 

for filing such comments is January 14, 

2011. All written submissions must 

conform with the provisions of sections 

201.8 and 207.3 of the Commission’s 

rules and any submissions that contain 

BPI must also conform with the 

requirements of sections 201.6 and 

207.7 of the Commission’s rules. The 

Commission’s rules do not authorize 

filing of submissions with the Secretary 

by facsimile or electronic means, except 

to the extent permitted by section 201.8 

of the Commission’s rules, as amended, 

67 FR 68036 (November 8, 2002). Also, 

in accordance with sections 201.16(c) 

and 207.3 of the Commission’s rules, 

each document filed by a party to the 

review must be served on all other 

parties to the review (as identified by 

either the public or APO service list as 

appropriate), and a certificate of service 

must accompany the document (if you 

are not a party to the review you do not 

need to serve your response). 

Inability to provide requested 

information.—Pursuant to section 

207.61(c) of the Commission’s rules, any 

interested party that cannot furnish the 

information requested by this notice in 

the requested form and manner shall 

notify the Commission at the earliest 

possible time, provide a full explanation 

of why it cannot provide the requested 

information, and indicate alternative 

forms in which it can provide 

equivalent information. If an interested 

party does not provide this notification 

(or the Commission finds the 

explanation provided in the notification 

inadequate) and fails to provide a 

complete response to this notice, the 

Commission may take an adverse 

inference against the party pursuant to 

section 776(b) of the Act in making its 

determination in the review. 

Information To Be Provided in 

Response to This Notice of Institution: 

As used below, the term ‘‘firm’’ includes 

any related firms. 

(1) The name and address of your firm 

or entity (including World Wide Web 

address) and name, telephone number, 

fax number, and E-mail address of the 

certifying official. 

(2) A statement indicating whether 

your firm/entity is a U.S. producer of 

the Domestic Like Product, a U.S. union 

or worker group, a U.S. importer of the 

Subject Merchandise, a foreign producer 

or exporter of the Subject Merchandise, 

a U.S. or foreign trade or business 

association, or another interested party 

(including an explanation). If you are a 

union/worker group or trade/business 

association, identify the firms in which 

your workers are employed or which are 

members of your association. 

(3) A statement indicating whether 

your firm/entity is willing to participate 

in this review by providing information 

requested by the Commission. 

(4) A statement of the likely effects of 

the revocation of the antidumping duty 

order on the Domestic Industry in 

general and/or your firm/entity 

specifically. In your response, please 

discuss the various factors specified in 

section 752(a) of the Act (19 U.S.C. 

1675a(a)) including the likely volume of 

subject imports, likely price effects of 

subject imports, and likely impact of 

imports of Subject Merchandise on the 

Domestic Industry. 

(5) A list of all known and currently 

operating U.S. producers of the 

Domestic Like Product. Identify any 

known related parties and the nature of 

the relationship as defined in section 

771(4)(B) of the Act (19 U.S.C. 

1677(4)(B)). 

(6) A list of all known and currently 

operating U.S. importers of the Subject 

Merchandise and producers of the 

Subject Merchandise in the Subject 

Country that currently export or have 

exported Subject Merchandise to the 

United States or other countries after 

2004. 

(7) A list of 3–5 leading purchasers in 

the U.S. market for the Domestic Like 

Product and the Subject Merchandise 

(including street address, World Wide 

Web address, and the name, telephone 

number, fax number, and E-mail address 

of a responsible official at each firm). 

(8) A list of known sources of 

information on national or regional 

prices for the Domestic Like Product or 

the Subject Merchandise in the U.S. or 

other markets. 

(9) If you are a U.S. producer of the 

Domestic Like Product, provide the 

following information on your firm’s 

operations on that product during 

calendar year 2009, except as noted 

(report quantity data in gross and value 

data in U.S. dollars, f.o.b. plant). If you 

are a union/worker group or trade/ 

business association, provide the 

information, on an aggregate basis, for 

the firms in which your workers are 

employed/which are members of your 

association. 

(a) Production (quantity) and, if 

known, an estimate of the percentage of 

total U.S. production of the Domestic 

Like Product accounted for by your 

firm’s(s’) production; 

(b) Capacity (quantity) of your firm to 

produce the Domestic Like Product (i.e., 

the level of production that your 

establishment(s) could reasonably have 

expected to attain during the year, 

assuming normal operating conditions 

(using equipment and machinery in 

place and ready to operate), normal 

operating levels (hours per week/weeks 

per year), time for downtime, 

maintenance, repair, and cleanup, and a 

typical or representative product mix); 

(c) The quantity and value of U.S. 

commercial shipments of the Domestic 

Like Product produced in your U.S. 

plant(s); and 

(d) The quantity and value of U.S. 

internal consumption/company 

transfers of the Domestic Like Product 

produced in your U.S. plant(s). 

(e) The value of (i) net sales, (ii) cost 

of goods sold (COGS), (iii) gross profit, 

(iv) selling, general and administrative 

(SG&A) expenses, and (v) operating 

income of the Domestic Like Product 

produced in your U.S. plant(s) (include 

both U.S. and export commercial sales, 

internal consumption, and company 

transfers) for your most recently 

completed fiscal year (identify the date 

on which your fiscal year ends). 

(10) If you are a U.S. importer or a 

trade/business association of U.S. 

importers of the Subject Merchandise 

from the Subject Country, provide the 

following information on your firm’s(s’) 

operations on that product during 

calendar year 2009 (report quantity data 

in gross and value data in U.S. dollars). 

If you are a trade/business association, 

provide the information, on an aggregate 

basis, for the firms which are members 

of your association. 

(a) The quantity and value (landed, 

duty-paid but not including 

antidumping duties) of U.S. imports 

mstockstill on DSKH9S0YB1PROD with NOTICES

Federal Register / Vol. 75, No. 210 / Monday, November 1, 2010 / Notices 67105 

1No response to this request for information is 

required if a currently valid Office of Management 

and Budget (OMB) number is not displayed; the 

OMB number is 3117–0016/USITC No. 11–5–231, 

expiration date June 30, 2011. Public reporting 

burden for the request is estimated to average 15 

hours per response. Please send comments 

regarding the accuracy of this burden estimate to 

the Office of Investigations, U.S. International Trade 

Commission, 500 E Street, SW., Washington, DC 

20436. 

and, if known, an estimate of the 

percentage of total U.S. imports of 

Subject Merchandise from the Subject 

Country accounted for by your firm’s(s’) 

imports; 

(b) The quantity and value (f.o.b. U.S. 

port, including antidumping duties) of 

U.S. commercial shipments of Subject 

Merchandise imported from the Subject 

Country; and 

(c) The quantity and value (f.o.b. U.S. 

port, including antidumping duties) of 

U.S. internal consumption/company 

transfers of Subject Merchandise 

imported from the Subject Country. 

(11) If you are a producer, an exporter, 

or a trade/business association of 

producers or exporters of the Subject 

Merchandise in the Subject Country, 

provide the following information on 

your firm’s(s’) operations on that 

product during calendar year 2009 

(report quantity data in gross and value 

data in U.S. dollars, landed and dutypaid at the U.S. port but not including 

antidumping duties). If you are a trade/ 

business association, provide the 

information, on an aggregate basis, for 

the firms which are members of your 

association. 

(a) Production (quantity) and, if 

known, an estimate of the percentage of 

total production of Subject Merchandise 

in the Subject Country accounted for by 

your firm’s(s’) production; and 

(b) Capacity (quantity) of your firm to 

produce the Subject Merchandise in the 

Subject Country (i.e., the level of 

production that your establishment(s) 

could reasonably have expected to 

attain during the year, assuming normal 

operating conditions (using equipment 

and machinery in place and ready to 

operate), normal operating levels (hours 

per week/weeks per year), time for 

downtime, maintenance, repair, and 

cleanup, and a typical or representative 

product mix); and 

(c) The quantity and value of your 

firm’s(s’) exports to the United States of 

Subject Merchandise and, if known, an 

estimate of the percentage of total 

exports to the United States of Subject 

Merchandise from the Subject Country 

accounted for by your firm’s(s’) exports. 

(12) Identify significant changes, if 

any, in the supply and demand 

conditions or business cycle for the 

Domestic Like Product that have 

occurred in the United States or in the 

market for the Subject Merchandise in 

the Subject Country after 2004, and 

significant changes, if any, that are 

likely to occur within a reasonably 

foreseeable time. Supply conditions to 

consider include technology; 

production methods; development 

efforts; ability to increase production 

(including the shift of production 

facilities used for other products and the 

use, cost, or availability of major inputs 

into production); and factors related to 

the ability to shift supply among 

different national markets (including 

barriers to importation in foreign 

markets or changes in market demand 

abroad). Demand conditions to consider 

include end uses and applications; the 

existence and availability of substitute 

products; and the level of competition 

among the Domestic Like Product 

produced in the United States, Subject 

Merchandise produced in the Subject 

Country, and such merchandise from 

other countries. 

(13) (OPTIONAL) A statement of 

whether you agree with the above 

definitions of the Domestic Like Product 

and Domestic Industry; if you disagree 

with either or both of these definitions, 

please explain why and provide 

alternative definitions. 

Authority: This review is being conducted 

under authority of title VII of the Tariff Act 

of 1930; this notice is published pursuant to 

section 207.61 of the Commission’s rules. 

By order of the Commission. 

Issued: October 26, 2010. 

Marilyn R. Abbott, 

Secretary to the Commission. 

[FR Doc. 2010–27442 Filed 10–29–10; 8:45 am] 

BILLING CODE 7020–02–P 

INTERNATIONAL TRADE 

COMMISSION 

[Investigations Nos. 731–TA–385 and 386 

(Third Review)] 

Granular Polytetrafluoroethylene Resin 

From Italy and Japan 

AGENCY: United States International 

Trade Commission. 

ACTION: Institution of five-year reviews 

concerning the antidumping duty orders 

on granular polytetrafluoroethylene 

resin from Italy and Japan. 

SUMMARY: The Commission hereby gives 

notice that it has instituted reviews 

pursuant to section 751(c) of the Tariff 

Act of 1930 (19 U.S.C. 1675(c)) (the Act) 

to determine whether revocation of the 

antidumping duty orders on granular 

polytetrafluoroethylene resin from Italy 

and Japan would be likely to lead to 

continuation or recurrence of material 

injury. Pursuant to section 751(c)(2) of 

the Act, interested parties are requested 

to respond to this notice by submitting 

the information specified below to the 

Commission; 1 to be assured of 

consideration, the deadline for 

responses is December 1, 2010. 

Comments on the adequacy of responses 

may be filed with the Commission by 

January 14, 2011. For further 

information concerning the conduct of 

these reviews 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, D, E, and 

F (19 CFR part 207), as most recently 

amended at 74 FR 2847 (January 16, 

2009). 

DATES: Effective Date: November 1, 

2010. 

FOR FURTHER INFORMATION CONTACT: 

Mary Messer (202–205–3193), Office of 

Investigations, U.S. International Trade 

Commission, 500 E Street, SW., 

Washington, DC 20436. Hearingimpaired persons can obtain 

information on this matter by contacting 

the Commission’s TDD terminal on 202– 

205–1810. Persons with mobility 

impairments who will need special 

assistance in gaining access to the 

Commission should contact the Office 

of the Secretary at 202–205–2000. 

General information concerning the 

Commission may also be obtained by 

accessing its internet server (http:// 

www.usitc.gov). The public record for 

these reviews may be viewed on the 

Commission’s electronic docket (EDIS) 

at http://edis.usitc.gov. 

SUPPLEMENTARY INFORMATION: 

Background.—On August 24, 1988, 

the Department of Commerce 

(‘‘Commerce’’) issued an antidumping 

duty order on imports of granular 

polytetrafluoroethylene resin from Japan 

(53 FR 32267). On August 30, 1988, 

Commerce issued an antidumping duty 

order on imports of granular 

polytetrafluoroethylene resin from Italy 

(53 FR 33163). Following first five-year 

reviews by Commerce and the 

Commission, effective January 3, 2000, 

Commerce issued a continuation of the 

antidumping duty orders on imports of 

granular polytetrafluoroethylene resin 

from Italy and Japan (65 FR 6147, 

February 8, 2000). Following second 

five-year reviews by Commerce and the 

Commission, effective December 22, 

2005, Commerce issued a continuation 

of the antidumping duty orders on 

imports of granular 

polytetrafluoroethylene resin from Italy 

and Japan (70 FR 76026). The 

mstockstill on DSKH9S0YB1PROD with NOTICES

Federal Register / Vol. 76, No. 40 / Tuesday, March 1, 2011 / Notices 11267 

1Commissioners Daniel R. Pearson and Shara L. 

Aranoff found that other circumstances warranted 

conducting a full review. 

2A record of the Commissioners’ votes, the 

Commission’s statement on adequacy, and any 

individual Commissioner’s statements will be 

available from the Office of the Secretary and at the 

Commission’s Web site. 

3The Commission has found the responses 

submitted by Dixon Ticonderoga Co.; General 

Pencil Co., Inc.; Musgrave Pencil Co.; and Sanford, 

L.P. to be individually adequate. Comments from 

other interested parties will not be accepted (see 19 

CFR 207.62(d)(2)). 

submissions with the Secretary by 

facsimile or electronic means only to the 

extent permitted by section 201.8 of the 

rules (see Handbook for Electronic 

Filing Procedures, http://www.usitc.gov/ 

secretary/fed_reg_notices/rules/ 

documents/ 

handbook_on_electronic_filing.pdf ). 

Persons with questions regarding 

electronic filing should contact the 

Secretary (202–205–2000). 

Any person desiring to submit a 

document to the Commission in 

confidence must request confidential 

treatment. All such requests should be 

directed to the Secretary to the 

Commission and must include a full 

statement of the reasons why the 

Commission should grant such 

treatment. See 19 CFR 201.6. Documents 

for which confidential treatment by the 

Commission is properly sought will be 

treated accordingly. All nonconfidential 

written submissions will be available for 

public inspection at the Office of the 

Secretary. 

This action is taken under the 

authority of section 337 of the Tariff Act 

of 1930, as amended (19 U.S.C. 1337), 

and of sections 201.10 and 210.50(a)(4) 

of the Commission’s Rules of Practice 

and Procedure (19 CFR 201.10, 

210.50(a)(4)). 

By order of the Commission. 

Issued: February 18, 2011. 

William R. Bishop, 

Hearings and Meetings Coordinator. 

[FR Doc. 2011–4439 Filed 2–28–11; 8:45 am] 

BILLING CODE 7020–02–P 

INTERNATIONAL TRADE 

COMMISSION 

[Investigation No. 731–TA–669 (Third 

Review)] 

Cased Pencils From China 

AGENCY: United States International 

Trade Commission. 

ACTION: Scheduling of an expedited fiveyear review concerning the antidumping 

duty order on cased pencils from China. 

SUMMARY: The Commission hereby gives 

notice of the scheduling of an expedited 

review pursuant to section 751(c)(3) of 

the Tariff Act of 1930 (19 U.S.C. 

1675(c)(3)) (the Act) to determine 

whether revocation of the antidumping 

duty order on cased pencils from China 

would be likely to lead to continuation 

or recurrence of material injury within 

a reasonably foreseeable time. For 

further information concerning the 

conduct of this review 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, D, E, and F (19 CFR part 

207). 

DATES: Effective Date: February 4, 2011. 

FOR FURTHER INFORMATION CONTACT: 

Mary Messer (202–205–3193), 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 review may be viewed on the 

Commission’s electronic docket (EDIS) 

at http://edis.usitc.gov. 

SUPPLEMENTARY INFORMATION: 

Background.—On February 4, 2011, 

the Commission determined that the 

domestic interested party group 

response to its notice of institution (75 

FR 67102, November 1, 2010) of the 

subject five-year review was adequate 

and that the respondent interested party 

group response was inadequate. The 

Commission did not find any other 

circumstances that would warrant 

conducting a full review. Accordingly, 

the Commission determined that it 

would conduct an expedited review 

pursuant to section 751(c)(3) of the 

Act.1 2

Staff report.—A staff report 

containing information concerning the 

subject matter of the review will be 

placed in the nonpublic record on April 

18, 2011, and made available to persons 

on the Administrative Protective Order 

service list for this review. A public 

version will be issued thereafter, 

pursuant to section 207.62(d)(4) of the 

Commission’s rules. 

Written submissions.—As provided in 

section 207.62(d) of the Commission’s 

rules, interested parties that are parties 

to the review and that have provided 

individually adequate responses to the 

notice of institution,3 and any party 

other than an interested party to the 

review may file written comments with 

the Secretary on what determination the 

Commission should reach in the review. 

Comments are due on or before April 

21, 2011 and may not contain new 

factual information. Any person that is 

neither a party to the five-year review 

nor an interested party may submit a 

brief written statement (which shall not 

contain any new factual information) 

pertinent to the review by April 21, 

2011. However, should the Department 

of Commerce extend the time limit for 

its completion of the final results of its 

review, the deadline for comments 

(which may not contain new factual 

information) on Commerce’s final 

results is three business days after the 

issuance of Commerce’s results. If 

comments contain business proprietary 

information (BPI), they must conform 

with the requirements of sections 201.6, 

207.3, and 207.7 of the Commission’s 

rules. The Commission’s rules do not 

authorize filing of submissions with the 

Secretary by facsimile or electronic 

means, except to the extent permitted by 

section 201.8 of the Commission’s rules, 

as amended, 67 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 sections 201.16(c) 

and 207.3 of the rules, each document 

filed by a party to the review must be 

served on all other parties to the review 

(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. 

Determination.—The Commission has 

determined to exercise its authority to 

extend the review period by up to 90 

days pursuant to 19 U.S.C. 

1675(c)(5)(B). 

Authority: This review is being conducted 

under authority of title VII of the Tariff Act 

of 1930; this notice is published pursuant to 

section 207.62 of the Commission’s rules. 

By order of the Commission. 

Issued: February 18, 2011. 

William R. Bishop, 

Hearings and Meetings Coordinator. 

[FR Doc. 2011–4440 Filed 2–28–11; 8:45 am] 

BILLING CODE 7020–02–P 


jlentini on DSKJ8SOYB1PROD with NOTICES
Federal Register / Vol. 76, No. 44 / Monday, March 7, 2011 / Notices 12323 

carbon content is two percent or less, by 

weight, and (3) none of the elements 

listed below is equal to or exceeds the 

quantity, by weight, respectively 

indicated: 1.80 percent of manganese, or 

1.50 percent of silicon, or 1.00 percent 

of copper, or 0.50 percent of aluminum, 

or 1.25 percent of chromium, or 0.30 

percent of cobalt, or 0.40 percent of 

lead, or 1.25 percent of nickel, or 0.30 

percent of tungsten, or 0.10 percent of 

molybdenum, or 0.10 percent of 

niobium, or 0.41 percent of titanium, or 

0.15 percent of vanadium, or 0.15 

percent zirconium. All products that 

meet the written physical description, 

and in which the chemistry quantities 

do not equal or exceed any one of the 

levels listed above, are within the scope 

of the orders unless otherwise 

specifically excluded. The following 

products are specifically excluded from 

the orders: (1) Products clad, plated, or 

coated with metal, whether or not 

painted, varnished or coated with 

plastic or other non-metallic substances; 

(2) SAE grades (formerly AISI grades) of 

series 2300 and above; (3) products 

made to ASTM A710 and A736 or their 

proprietary equivalents; (4) abrasionresistant steels (i.e., USS AR 400, USS 

AR 500); (5) products made to ASTM 

A202, A225, A514 grade S, A517 grade 

S, or their proprietary equivalents; (6) 

ball bearing steels; (7) tool steels; and (8) 

silicon manganese steel or silicon 

electric steel. 

Regarding the scope of the order for 

Japan, the following additional 

exclusions apply with respect to 

abrasion-resistant steels: NK–EH–360 

(NK Everhard 360) and NK–EH–500 (NK 

Everhard 500). NK–EH–360 has the 

following specifications: (a) Physical 

Properties: Thickness ranging from 6–50 

mm, Brinell Hardness: 361 min.; (b) 

Heat Treatment: controlled heat 

treatment; and (c) Chemical 

Composition (percent weight): C: 0.20 

max., Si: 0.55 max., Mn: 1.60 max., P: 

0.030 max., S: 0.030 max., Cr: 0.40 max., 

Ti: 0.005–0.020, B: 0.004 max. NK–EH– 

500 has the following specifications: (a) 

Physical Properties: Thickness ranging 

from 6–50 mm, Brinell Hardness: 477 

min.; (b) Heat Treatment: Controlled 

heat treatment; and (c) Chemical 

Composition (percent weight): C: 0.35 

max., Si: 0.55 max., Mn: 1.60 max., P: 

0.030 max., S: 0.030 max., Cr: 0.80 max., 

Ti: 0.005–0.020, B: 0.004 max. 

The merchandise subject to the orders 

is currently classifiable in the HTSUS 

under subheadings: 7208.40.3030, 

7208.40.3060, 7208.51.0030, 

7208.51.0045, 7208.51.0060, 

7208.52.0000, 7208.53.0000, 

7208.90.0000, 7210.70.3000, 

7210.90.9000, 7211.13.0000, 

7211.14.0030, 7211.14.0045, 

7211.90.0000, 7212.40.1000, 

7212.40.5000, 7212.50.0000, 

7225.40.3050, 7225.40.7000, 

7225.50.6000, 7225.99.0090, 

7226.91.5000, 7226.91.7000, 

7226.91.8000, 7226.99.0000. Although 

the HTSUS subheadings are provided 

for convenience and customs purposes, 

the written description of the 

merchandise covered by the orders is 

dispositive. 

Analysis of Comments Received 

All issues raised in these reviews are 

addressed in the ‘‘Issues and Decision 

Memorandum for the Expedited Sunset 

Reviews of the Antidumping Duty 

Orders on Certain Cut-To-Length 

Carbon-Quality Steel Plate from India, 

Indonesia, Italy, Japan, and the Republic 

of Korea’’ from Christian Marsh, Deputy 

Assistant Secretary for Antidumping 

and Countervailing Duty Operations, to 

Ronald K. Lorentzen, Deputy Assistant 

Secretary for Import Administration 

(Decision Memo), which is hereby 

adopted by, and issued concurrently 

with, this notice. The issues discussed 

in the Decision Memo include the 

likelihood of continuation or recurrence 

of dumping and the magnitude of the 

margins likely to prevail if the orders 

were revoked. Parties can find a 

complete discussion of all issues raised 

in these reviews and the corresponding 

recommendations in this public 

memorandum which is on file in the 

Central Records Unit, room 7046 of the 

main Department building. 

In addition, a complete version of the 

Decision Memo can be accessed directly 

on the Web at http://ia.ita.doc.gov/frn. 

The paper copy and electronic version 

of the Decision Memo are identical in 

content. 

Final Results of Reviews 

We determine that revocation of the 

antidumping duty orders on CTL Plate 

from India, Indonesia, Italy, Japan, and 

the Republic of Korea would be likely 

to lead to continuation or recurrence of 

dumping at the rates listed below: 

Exporter/manufacturer Margin 

percentage 

India: 

Steel Authority of India, Ltd .. 42.39 

All Others .............................. 42.39 

Indonesia: 

PT Gunawan Dianjaya/PT 

Jaya Pari Steel Corporation ..................................... 50.80 

PT Krakatau Steel ................. 52.42 

All Others .............................. 50.80 

Italy: 

Palini and Bertoli S.p.A ......... 7.64 

All Others .............................. 7.64 

Japan: 

Exporter/manufacturer Margin 

percentage 

Kawasaki Steel Corporation 9.46 

Kobe Steel, Ltd ..................... 59.12 

Nippon Steel Corporation ..... 59.12 

NKK Corporation ................... 59.12 

Sumitomo Metal Industries, 

Ltd ...................................... 59.12 

All Others .............................. 9.46 

Republic of Korea: 

Dongkuk Steel Mill Co., Ltd .. 2.98 

All Others .............................. 2.98 

This notice also serves as the only 

reminder to parties subject to 

administrative protective order (APO) of 

their responsibility concerning the 

return or destruction of proprietary 

information disclosed under APO in 

accordance with 19 CFR 351.305. 

Timely notification of the return or 

destruction of APO materials or 

conversion to judicial protective orders 

is hereby requested. Failure to comply 

with the regulations and terms of an 

APO is a violation which is subject to 

sanction. 

We are issuing and publishing the 

results and notice in accordance with 

sections 751(c), 752(c), and 777(i)(1) of 

the Act. 

Dated: March 1, 2011. 

Ronald K. Lorentzen, 

Deputy Assistant Secretary for Import 

Administration. 

[FR Doc. 2011–5125 Filed 3–4–11; 8:45 am] 

BILLING CODE 3510–DS–P 

DEPARTMENT OF COMMERCE 

International Trade Administration 

[A–570–827] 

Certain Cased Pencils From the 

People’s Republic of China: Final 

Results of the Expedited Third Sunset 

Review of the Antidumping Duty Order 

AGENCY: Import Administration, 

International Trade Administration, 

Department of Commerce. 

DATES: Effective Date: March 7, 2011. 

SUMMARY: On November 1, 2010, the 

Department of Commerce 

(‘‘Department’’) published in the Federal 

Register the notice of initiation of the 

third sunset review of the antidumping 

duty order on certain cased pencils 

(‘‘pencils’’) from the People’s Republic of 

China (‘‘PRC’’), pursuant to section 

751(c) of the Tariff Act of 1930, as 

amended (‘‘the Act’’). See Initiation of 

Five-Year (‘‘Sunset’’) Review, 75 FR 

67082 (November 1, 2010). The 

Department has conducted an expedited 

sunset review of this order pursuant to 

section 751(c)(3)(B) of the Act and 19 


srobinson on DSKHWCL6B1PROD with NOTICES
12324 Federal Register / Vol. 76, No. 44 / Monday, March 7, 2011 / Notices 

CFR 351.218(e)(1)(ii)(C)(2). As a result 

of the sunset review, the Department 

finds that revocation of the antidumping 

duty order would be likely to lead to 

continuation or recurrence of dumping 

at the margins identified in the ‘‘Final 

Results of Review’’ section of this notice. 

FOR FURTHER INFORMATION CONTACT: Seth 

Isenberg or Yasmin Nair, AD/CVD 

Operations, Office 1, Import 

Administration, International Trade 

Administration, U.S. Department of 

Commerce, 14th Street and Constitution 

Avenue, NW., Washington, DC 20230; 

telephone (202) 482–0588 and (202) 

482–3813, respectively. 

SUPPLEMENTARY INFORMATION: 

Background 

The antidumping duty order that 

covers pencils from the PRC was 

published in the Federal Register on 

December 28, 1994. See Antidumping 

Duty Order: Certain Cased Pencils from 

the People’s Republic of China, 59 FR 

66909 (December 28, 1994), amended at 

Certain Cased Pencils From the People’s 

Republic of China; Notice of Amended 

Final Determination of Sales at Less 

Than Fair Value and Amended 

Antidumping Duty Order in Accordance 

With Final Court Decision, 64 FR 25275 

(May 11, 1999). On November 1, 2010, 

the Department initiated the third 

sunset review of this order, pursuant to 

section 751(c) of the Act. See Initiation 

of Five-Year (‘‘Sunset’’) Review, 75 FR 

67082 (November 1, 2010). The 

Department received a notice of intent 

to participate from domestic interested 

parties Sanford Corp.; General Pencil 

Co., Inc.; and Musgrave Pencil Co. 

(collectively, ‘‘Petitioners’’), within the 

deadline specified in 19 CFR 

351.218(d)(1)(i). Petitioners claimed 

interested party status under section 

771(9)(C) of the Act, as manufacturers of 

a domestic-like product in the United 

States. The Department also received a 

notice of intent to participate from 

Dixon Ticonderoga Company (‘‘Dixon’’), 

within the deadline specified in 19 CFR 

351.218(d)(1)(i). Dixon claimed 

interested party status under section 

771(4)(B) of the Act, as an importer of 

the subject merchandise that is related 

to a foreign producer and exporter of the 

subject merchandise. 

On December 1, 2010, the Department 

received a substantive response from 

Petitioners. In addition to meeting the 

other requirements of 19 CFR 

351.218(d)(3), Petitioners provided 

information on the volume and value of 

exports of pencils from the PRC. The 

Department did not receive a 

substantive response from Dixon. The 

Department did not receive adequate 

substantive responses, or any response 

at all, from any respondent interested 

parties to this proceeding. As a result, 

pursuant to section 751(c)(3)(B) of the 

Act and 19 CFR 351.218(e)(1)(ii)(C)(2), 

the Department conducted an expedited 

(120-day) sunset review of the 

antidumping duty order on pencils from 

the PRC. 

Scope of the Order 

Imports covered by the order are 

shipments of certain cased pencils of 

any shape or dimension (except as 

described below) which are writing and/ 

or drawing instruments that feature 

cores of graphite or other materials, 

encased in wood and/or man-made 

materials, whether or not decorated and 

whether or not tipped (e.g., with erasers, 

etc.) in any fashion, and either 

sharpened or unsharpened. The pencils 

subject to the order are currently 

classifiable under subheading 

9609.10.00 of the Harmonized Tariff 

Schedule of the United States 

(‘‘HTSUS’’). Specifically excluded from 

the scope of the order are mechanical 

pencils, cosmetic pencils, pens, noncased crayons (wax), pastels, charcoals, 

chalks, and pencils produced under 

U.S. patent number 6,217,242, from 

paper infused with scents by the means 

covered in the above-referenced patent, 

thereby having odors distinct from those 

that may emanate from pencils lacking 

the scent infusion. Also excluded from 

the scope of the order are pencils with 

all of the following physical 

characteristics: (1) Length: 13.5 or more 

inches; (2) sheath diameter: not less 

than one-and-one quarter inches at any 

point (before sharpening); and (3) core 

length: Not more than 15 percent of the 

length of the pencil. 

In addition, pencils with all of the 

following physical characteristics are 

excluded from the scope of the order: 

Novelty jumbo pencils that are 

octagonal in shape, approximately ten 

inches long, one inch in diameter before 

sharpening, and three-and-one eighth 

inches in circumference, composed of 

turned wood encasing one-and-one half 

inches of sharpened lead on one end 

and a rubber eraser on the other end. 

Although the HTSUS subheading is 

provided for convenience and customs 

purposes, the written description of the 

scope of the order is dispositive. 

Analysis of Comments Received 

All issues raised in this review are 

addressed in the Issues and Decision 

Memorandum (‘‘Decision 

Memorandum’’) from Christian Marsh, 

Deputy Assistant Secretary for 

Antidumping and Countervailing Duty 

Operations, to Ronald K. Lorentzen, 

Deputy Assistant Secretary for Import 

Administration, dated March 1, 2011, 

which is hereby adopted by this notice. 

The issues discussed in the Decision 

Memorandum include the likelihood of 

continuation or recurrence of dumping 

and the magnitude of the margins likely 

to prevail if the order were revoked. 

Parties can find a complete discussion 

of all issues raised in this review and 

the corresponding recommendations in 

this public memorandum, which is on 

file in the Central Records Unit in room 

7046 of the main Commerce building. 

In addition, a complete version of the 

Decision Memorandum can be accessed 

directly on the Internet at http:// 

ia.ita.doc.gov/frn. The paper copy and 

electronic version of the Decision 

Memorandum are identical in content. 

Final Results of Review 

Pursuant to sections 752(c)(1) and (3) 

of the Act, we determine that revocation 

of the antidumping duty order on 

pencils from the PRC would be likely to 

lead to continuation or recurrence of 

dumping at the following weightedaverage percentage margins: 

Manufacturers/producers/exporters Margin 

(percent) 

China First Pencil Co., Ltd ...................................................................................................................................................................... 8.60 

Shanghai Three Star Stationery Industry Corp 1 ..................................................................................................................................... 0.00 

Shanghai Lansheng Corp ........................................................................................................................................................................ 19.36 

Shanghai Foreign Trade Corp ................................................................................................................................................................. 11.15 

Guangdong Provincial Stationery & Sporting Goods Import & Export Corp 2 ........................................................................................ 53.65 


srobinson on DSKHWCL6B1PROD with NOTICES
Federal Register / Vol. 76, No. 44 / Monday, March 7, 2011 / Notices 12325 

1See ‘‘Partial Rescission of the Administrative 

Review’’ section below. 

2See ‘‘Separate Rates’’ section below. 

3See ‘‘The PRC–Wide Entity, PRC–Wide Rate, and 

Use of Adverse Facts Available’’ section below. 

4See ‘‘Intent to Rescind, in Part, the 

Administrative Review’’ section below. 

5See Antidumping Duty Order: Small Diameter 

Graphite Electrodes from the People’s Republic of 

China, 74 FR 8775 (February 26, 2009). 

6See Antidumping or Countervailing Duty Order, 

Finding, or Suspended Investigation; Opportunity 

to Request Administrative Reviews, 75 FR 5037 

(February 1, 2010). 

Manufacturers/producers/exporters Margin 

(percent) 

PRC–Wide Rate ...................................................................................................................................................................................... 53.65 

1 In the original order and subsequent administrative reviews, China First Pencil Co. Ltd (‘‘China First’’) and Shanghai Three Star Stationery Industry Co., Ltd. (‘‘Three Star’’) were treated as separate entities. In the 1999–2000 administrative review, the Department determined that China 

First and Three Star should henceforth be treated as a single entity. See Certain Cased Pencils from the People’s Republic of China; Final Results and Partial Rescission of Antidumping Duty Administrative Review, 67 FR 48612 (July 25, 2002) (‘‘99–00 Pencils Final’’) and accompanying 

Issues and Decision Memorandum at Comment 12, amended at Notice of Amended Final Results and Partial Rescission of Antidumping Duty 

Administrative Review: Certain Cased Pencils from the People’s Republic of China, 67 FR 59049 (September 19, 2002). The Department continued to treat China First and Three Star as a single entity in the four successive administrative reviews. In the 2006–2007 administrative review, 

the Department determined that due to new evidence regarding the relationship between China First and Three Star there was no longer a sufficient basis to combine the two companies. See Certain Cased Pencils from the People’s Republic of China; Final Results and Partial Rescission 

of Antidumping Duty Administrative Review, 74 FR 33406 (July 13, 2009) and accompanying Issues and Decision Memorandum at Comment 1, 

amended at Certain Cased Pencils from the People’s Republic of China: Amended Final Results of Antidumping Duty Administrative Review, 74 

FR 45177 (September 1, 2009). The Department continues to view China First and Three Star as separate and distinct entities as a result of the 

2006–2007 administrative review determination. See Certain Cased Pencils From the People’s Republic of China; Final Results of the Antidumping Duty Administrative Review, 75 FR 38980 (July 7, 2010). 2The Department originally excluded from the order exports made by Guangdong Provincial Stationery & Sporting Goods Import & Export 

Corp. (‘‘Guangdong’’) and produced by Three Star. However, the Department determined in the 1999–2000 administrative review that the 

Guangdong/Three Star sales chain was no longer excluded from the order, and that all merchandise exported by Guangdong was subject to the 

cash deposit requirements at the PRC–Wide Rate. See 99–00 Pencils Final and accompanying Issues and Decision Memorandum at Comment 

1, amended at 67 FR 59049. 

This notice also serves as the only 

reminder to parties subject to 

administrative protective order (‘‘APO’’) 

of their responsibility concerning the 

return or destruction of proprietary 

information disclosed under APO in 

accordance with 19 CFR 351.305. 

Timely notification of the return or 

destruction of APO materials or 

conversion to judicial protective orders 

is hereby requested. Failure to comply 

with the regulations and terms of an 

APO is a violation which is subject to 

sanction. 

We are issuing and publishing the 

final results and notice in accordance 

with sections 751(c), 752(c), and 

777(i)(1) of the Act. 

Dated: March 1, 2011. 

Ronald K. Lorentzen, 

Deputy Assistant Secretary for Import 

Administration. 

[FR Doc. 2011–5123 Filed 3–4–11; 8:45 am] 

BILLING CODE 3510–DS–P 

DEPARTMENT OF COMMERCE 

International Trade Administration 

[A–570–929] 

Small Diameter Graphite Electrodes 

From the People’s Republic of China: 

Preliminary Results of the First 

Administrative Review of the 

Antidumping Duty Order; Partial 

Rescission of Administrative Review; 

and Intent To Rescind Administrative 

Review, in Part 

AGENCY: Import Administration, 

International Trade Administration, 

Department of Commerce. 

SUMMARY: In response to requests from 

interested parties, the Department of 

Commerce. (‘‘Department’’) is 

conducting the first administrative 

review of the antidumping duty order 

on small diameter graphite electrodes 

(‘‘SDGE’’) from the People’s Republic of 

China (‘‘PRC’’), covering the period 

August 21, 2008, through January 31, 

2010. The Department has preliminarily 

determined that during the period of 

review (‘‘POR’’) respondents in this 

proceeding have made sales of subject 

merchandise at less than normal value 

(‘‘NV’’). If these preliminary results are 

adopted in our final results of review, 

we will instruct U.S. Customs and 

Border Protection (‘‘CBP’’) to assess 

antidumping duties on all appropriate 

entries of subject merchandise during 

the POR. The Department is also 

rescinding this review for those 

exporters for which requests for review 

were timely withdrawn.1 For the 

companies for which this review is 

rescinded, antidumping duties shall be 

assessed at rates equal to the cash 

deposit of estimated antidumping duties 

required at the time of entry, or 

withdrawal from warehouse, for 

consumption. Furthermore, we 

determine that four companies for 

which a review was requested have not 

been responsive, and thus have not 

demonstrated entitlement to a separate 

rate.2 As a result, we have preliminarily 

determined that they are part of the 

PRC-wide entity, and continue to be 

subject to the PRC-wide entity rate.3

Further, the Department intends to 

rescind this administrative review with 

respect to UK Carbon & Graphite 

(‘‘UKCG’’) if the Department concludes 

that there were no entries, exports, or 

sales of the subject merchandise to the 

United States during the POR.4

Interested parties are invited to 

comment on these preliminary results. 

We will issue final results no later than 

120 days from the date of publication of 

this notice, pursuant to section 

751(a)(3)(A) of the Tariff Act of 1930, as 

amended (‘‘the Act’’). 

DATES: Effective Date: March 7, 2011. 

FOR FURTHER INFORMATION CONTACT: 

Lindsey Novom or Frances Veith, AD/ 

CVD Operations, Office 8, Import 

Administration, International Trade 

Administration, U.S. Department of 

Commerce, 14th Street and Constitution 

Avenue, NW., Washington DC 20230; 

telephone: (202) 482–5256 or (202) 482– 

4295, respectively. 

Background 

On February 26, 2009, the Department 

published in the Federal Register the 

antidumping duty order on SDGE from 

the PRC.5 On February 1, 2010, the 

Department published a notice of 

opportunity to request an administrative 

review of the antidumping duty order 

on SDGE from the PRC.6 On February 

23, February 25, and February 26, 2010, 

the Department received timely requests 

for an administrative review of this 

antidumping duty order in accordance 

with 19 CFR 351.213(b) from Fushun 

Jinly Petrochemical Carbon Co., Ltd 

(‘‘Fushun Jinly’’), Xinghe County Muzi 

Carbon Co., Ltd. (‘‘Muzi Carbon’’), and 

Beijing Fangda Carbon Tech Co., Ltd. 

(‘‘Beijing Fangda’’), Chengdu Rongguang 


srobinson on DSKHWCL6B1PROD with NOTICES
APPENDIX B

COMMISSION’S STATEMENT ON ADEQUACY

B-1

EXPLANATION OF COMMISSION DETERMINATION ON ADEQUACY

in 

Cased Pencils from China

Inv. No. 731-TA-669 (Third Review)

On February 4, 2011, the Commission determined that it should proceed to an expedited

review in the subject five-year review pursuant to section 751(c)(3)(B) of the Tariff Act of 1930,

as amended, 19 U.S.C. § 1675(c)(3)(B).

The Commission received two submissions from four domestic interested parties in

response to the notice of institution. One response was filed on behalf of Sanford, L.P., General

Pencil Co., Inc., and Musgrave Pencil Co., three domestic producers of cased pencils. The other

was filed by domestic producer Dixon Ticonderoga Co. The Commission found the individual

responses to be adequate, and determined that the domestic interested party group response was

adequate. 

The Commission received no response from any respondent interested party, and

therefore determined that the respondent interested party group response was inadequate. In the

absence of an adequate respondent interested party group response or any other circumstances

warranting a full review, the Commission determined to conduct an expedited review.1

A record of the Commissioners’ votes is available from the Office of the Secretary and

the Commission’s web site (www.usitc.gov).

1

 Commissioners Daniel R. Pearson and Shara L. Aranoff found that circumstances

warranted conducting a full review of the antidumping duty order and therefore voted to conduct

a full review.

APPENDIX C

PURCHASER RESPONSES

C-1

As part of their response to the notice of institution, interested parties were asked to provide a list

of three to five leading purchasers in the U.S. market for the domestic like product. A response was

received from domestic interested parties and they named the following 15 firms as the top purchasers of

cased pencils: ***. Purchaser questionnaires were sent to these 15 firms and nine firms (***) provided

responses which are presented below. Please note that *** reported separate responses for its *** stores,

which are shown separately below.

C-3
1. a) Have any changes occurred in technology; production methods; or development efforts

to produce cased pencils that affected the availability of cased pencils in the U.S. market or

in the market for cased pencils in China since 2005?

b) Do you anticipate any changes in technology; production methods; or development

efforts to produce cased pencils that will affect the availability of cased pencils in the U.S.

market or in the market for cased pencils in China within a reasonably foreseeable time?

Purchaser Changes that have occurred Anticipated changes

***

Yes. Our supplier, ***, has made

significant investments in machinery

and equipment to reduce their

manufacturing costs. These

investments have occurred during

the past 12 months.

Yes. Low cost Chinese pencils exist in

the marketplace today. If they

continue to flood the market, or if the

duties are reduced, we will be forced to

source the pencils from a Chinese

supplier. Chinese suppliers are

aggressively seeking U.S. customers

and don’t seem to always be affected

by the tariffs. 

***

*** has no knowledge of technology,

production, or development of this

product. *** has no significant

manufacturing information.

*** has no knowledge of technology,

production, or development of this

product. *** has no significant

manufacturing information.

*** No. No.

*** No. No.

*** No. No.

*** No. No.

*** No. No.

*** No. No.

***

No. ***, as a retailer not directly

involved with the production of

pencils, is not aware of technology

shifts affecting the availability of

cased pencils. No.

***

Yes. Since 2000, paper pencils

have been on the market. However,

this has had limited impact on the

availability of cased pencils due to

higher prices.

Yes. The availability of basswood and

linden wood might affect the availability

at current prices. Poplar wood will be

readily available within 4 to 7 years.

C-4
2. a) Have any changes occurred in the ability to increase production of cased pencils

(including the shift of production facilities used for other products and the use, cost, or

availability of major inputs into production) that affected the availability of cased pencils in

the U.S. market or in the market for cased pencils in China since 2005?

b) Do you anticipate any changes in the ability to increase production (including the shift of

production facilities used for other products and the use, cost, or availability of major

inputs into production) that will affect the availability of cased pencils in the U.S. market or

in the market for cased pencils in China within a reasonably foreseeable time?

 Purchaser Changes that have occurred Anticipated changes

***

Yes. There appears to be more and

more Chinese pencil manufacturers

contacting U.S. companies and trying

to secure business. This would

appear to us to be an increase in

capacity for manufacturing wood

cased pencils in China.

Yes. We anticipate greater Chinese

capacity. A previous domestic

manufacturer, ***, has opened a

factory in Beijing. If the tariffs were

reduced, we would be forced to

replace our domestic supplier with a

Chinese supplier.

***

*** has no knowledge of this product

and no significant manufacturing

information.

*** has no knowledge of this product

and no significant manufacturing

information.

*** No. No.

*** No. No.

***

Yes. Pencil availability from Taiwan

and Vietnam has increased in the last

5 years.

No.

***

No. Yes. The shortage of cedar has

affected the supply of wood cased

pencils during back to school in 2010.

***

Yes. Suppliers have told us that

there is a wood shortage.

Yes. Suppliers have told us that there

is a wood shortage.

*** No. No.

***

No. ***, as a retailer not directly

involved with the production of

pencils, is not aware of production

shifts affecting the availability of

cased pencils.

No.

***

No. Yes. Shifted to other producing

countries over the last 3 to 5 years.

C-5
3. a) Have any changes occurred in factors related to the ability to shift supply of cased

pencils among different national markets (including barriers to importation in foreign

markets or changes in market demand abroad) that affected the availability of cased pencils

in the U.S. market or in the market for cased pencils in China since 2005?

b) Do you anticipate any changes in factors related to the ability to shift supply among

different national markets (including barriers to importation in foreign markets or changes

in market demand abroad) that will affect the availability of cased pencils in the U.S.

market or in the market for cased pencils in China within a reasonably foreseeable time?

Purchaser Changes that have occurred Anticipated changes

***

Yes. From what we understand,

Mexico has imposed very high

customs on imported wood cased

pencils from China, so fewer illegal

shipments of wood cased pencils are

coming from Mexico. We view this as

a positive development.

Yes. We understand that Russia is

having the same problem as the

United States is having, and is

considering imposing large duties as

well.

***

*** has no significant manufacturing

information.

*** has no significant manufacturing

information.

*** No. No.

***

Yes. Significant production of case

pencils by Chinese manufacturers in

China continues with manufacturers

granted “favorable” anti-dumping

duties, where a majority of this

production is most likely sold to U.S.

retailers and distributors by domestic

companies. Other Asian countries

(Vietnam, Taiwan, and Indonesia)

also supply a large volume of pencils

to the U.S. market.

No.

***

Yes. The last 3 years has seen

significant rise in the consumption of

wood cased pencils for use in the

Chinese market. Several suppliers in

China have been unable to bid on

production space for export quotes

recently due to filling production

within local market needs.

No.

*** No. No.

*** No. No.

***

No. To the best of our knowledge,

no.

No. To the best of our knowledge, no.

C-6
3.–Continued

Purchaser Changes that have occurred Anticipated changes

***

Yes. U.S. anti-dumping duties

assessed for pencils produced in

various countries always seems to

have an affect on the geographical

production of pencils, though this

statement is made with no specific

AD duty or investigation in mind.

Yes. U.S. anti-dumping duties

assessed for pencils produced in

various countries always seems to

have an affect on the geographical

production of pencils, though this

statement is made with no specific AD

duty or investigation in mind.

***

Yes. Change to other countries with

reduced and/or no antidumping

impact.

Yes. In the next year or two, new

countries will have developed the

capacity to meet the demands.

4. a) Have there been any changes in the end uses and applications of cased pencils in the U.S.

market or in the market for cased pencils in China since 2005?

b) Do you anticipate any changes in the end uses and applications of cased pencils in the

U.S. market or in the market for cased pencils in China within a reasonably foreseeable

time?

Purchaser Changes that have occurred Anticipated changes

*** No. No.

*** No. No.

*** No. No.

*** No. No.

*** No. No.

*** No. No.

*** No. No.

*** No. No.

*** No. No.

***

Yes. Growth in markets outside of

back to school. Examples include

decorated cased pencils for

seasonal, promotional, or party

ware.

Yes. The market will decrease in the

next 3 to 5 years due to technology

usage at a younger age.

C-7
5. a) Have there been any changes in the existence and availability of substitute products for 

cased pencils in the U.S. market or in the market for cased pencils in China since 2005?

b) Do you anticipate any changes in the existence and availability of substitute products for

cased pencils in the U.S. market or in the market for cased pencils in China within a

reasonably foreseeable time?

Purchaser Changes that have occurred Anticipated changes

*** No. No.

*** No. No.

*** No. No.

*** No. No.

*** No. No.

*** No. No.

*** No. No.

*** No. No.

***

Yes. A small amount of liquid

pencils have been introduced into

the retail market recently.

No.

***

Yes. Paper, bamboo, plastic

cased and mechanical pencils.

Yes. More reusable and eco-friendly

material versus wood cased.

C-8
6. a) Have there been any changes in the level of competition between cased pencils produced

in the United States, cased pencils produced in China, and such merchandise from other

countries in the U.S. market or in the market for cased pencils in China since 2005?

b) Do you anticipate any changes in the level of competition between cased pencils

produced in the United States, cased pencils produced in China, and such merchandise

from other countries in the U.S. market or in the market for cased pencils in China within a

reasonably foreseeable time?

Purchaser Changes that have occurred Anticipated changes

***

Yes. The existence of low cost

Chinese pencils has definitely lowered

costs in the U.S. and forced lower

prices in the marketplace. It appears

that illegal transhipments are taking

place via Taiwan, Indonesia, and

Thailand, circumventing anti-dumping

duties. It also appears that major

Chinese suppliers are qualifying for

lower dumping duties and affecting the

U.S. pencil manufacturers negatively.

Yes. Continued expansion of Chinese

capacity will place greater pressure on

U.S. pencil companies and may force

additional closures which would affect

U.S. competition. The U.S. has

already seen around 15 companies go

out of business, leaving only 2 or 3 real

U.S. pencil manufacturers. I also

worry about the quality of the paint and

wood used in these low cost pencils

and what affect it will have on the U.S.

consumer. U.S.-made pencils are of

significantly better quality than Chinese

pencils. I have toured Chinese pencil

factories and the quality standards of

production and the sourcing of the raw

materials are inferior to U.S.

standards, but we are forced to

compete with them.

*** No. Not to our knowledge. No. Not to our knowledge.

*** No. No.

*** No. No.

***

Yes. Competitive sources are

available in Vietnam, Indonesia,

Taiwan, and India.

No.

***

Yes. *** no longer produces the value

wood cased pencils because they

were losing money by producing this

item.

No.

*** No. No.

***

Yes. We believe production of cased

pencils in Indonesia has increased

materially since 2005.

No.

C-9
6.–Continued

Purchaser Changes that have occurred Anticipated changes

***

Yes. From a pencil purchaser

perspective, it appears that more

pencils are produced in Vietnam

recently than in past years.

No.

***

Yes. In the past 3 to 5 years, India,

Indonesia, and the Philippines have

increased production capacity.

Yes. More factories are opening with

better labor markets and lower labor

costs.

7. a) Have there been any changes in the business cycle for cased pencils in the U.S. market or

in the market for cased pencils in China since 2005?

 b) Do you anticipate any changes in the business cycle for cased pencils in the U.S. market

or in the market for cased pencils in China within a reasonably foreseeable time?

Purchaser Changes that have occurred Anticipated changes

***

Yes. The collapse of U.S. new

single-family home construction has

definitely cause a reduction in

demand for wood cased pencils.

Yes. We remain skeptical, but

optimistic that the U.S. single-family

housing market will grow slightly in

2011 and continue to improve in 2012,

which should increase the demand for

Carpenters Pencils in particular.

*** No. Not to our knowledge. No. Not to our knowledge.

*** No. No.

*** No. No.

*** No. No.

*** No. No.

*** No. No.

*** No. No.

*** No. No.

***

No. Yes. There will be less back to school

demand in the next 3 to 5 years

resulting from increased technology

usage and eco-friendly cost choices.

C-10