U.S. International Trade Commission

Publication 4062 February 2009

Washington, DC 20436

Small Diameter Graphite Electrodes from 

China

Investigation No. 731-TA-1143 (Final)
U.S. International Trade Commission

COMMISSIONERS 

 

Shara L. Aranoff, Chairman 

Daniel R. Pearson, Vice Chairman 

Deanna Tanner Okun 

Charlotte R. Lane 

Irving A. Williamson 

Dean A. Pinkert

Robert A. Rogowsky

Staff assigned

Address all communications to 

Secretary to the Commission 

United States International Trade Commission 

Washington, DC 20436

Director of Operations

 Fred Ruggles, Investigator 

Andrew David, Industry Analyst 

 Ruben Mata, Industry Analyst 

 Nancy Bryan, Economist 

 Mary Klir, Accountant 

 Lita David-Harris, Statistician 

 Gracemary Roth-Roffy, Attorney 

 George Deyman, Supervisory Investigator 
U.S. International Trade Commission

Washington, DC 20436 

www.usitc.gov

Publication 4062 February 2009

Small Diameter Graphite Electrodes from 

China

Investigation No. 731-TA-1143 (Final)

i

CONTENTS

Page

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

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

Separate and concurring views of Commissioner Charlotte R. Lane . . . . . . . . . . . . . . . . . . . . . 27

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

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

Statutory criteria and organization of the report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-1

Statutory criteria . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-1

Organization of the report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-2

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

Summary data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-4

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

Nature and extent of sales at LTFV . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-5

The subject merchandise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-5

Commerce’s scope . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-5

Tariff treatment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-5

Domestic like product . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-6

Physical characteristics and uses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-7

Manufacturing facilities and production processes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-12

Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-16

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

U.S. market segments/channels of distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-1

Supply and demand considerations ................................................ II-3

U.S. supply .............................................................. II-3

U.S. demand . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-6

Substitutability issues .......................................................... II-8

Factors affecting purchasing decisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-8

Comparisons of domestic product and subject imports ............................ II-11

Other country comparisons .................................................. II-17

Elasticity estimates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-19

U.S. supply elasticity ...................................................... II-19

U.S. demand elasticity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-19

Substitution elasticity ...................................................... II-19

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

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

U.S. production, capacity, and capacity utilization ................................... III-2

U.S. producers’ shipments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . III-4

U.S. producers’ imports and purchases ............................................. III-8

U.S. producers’ inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . III-8

U.S. employment, wages, and productivity ......................................... III-9
ii

CONTENTS - Continued

Page

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

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

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

Critical circumstances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-5

Negligibility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-5

Apparent U.S. consumption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-6

U.S. market shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-9

Ratio of imports to U.S. production . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-10

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

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

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

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

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

Exchange rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-2

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

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

Sales terms and discounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-4

Price data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-5

Price trends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-6

Price comparisons . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-17

Lost sales and lost revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-19

Part VI: Financial condition of U.S. producers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-1

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

Operations on SDGE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-1

Capital expenditures and research and development expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-9

Assets and return on investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-10

Capital and investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-10

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

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

U.S. importers’ inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VII-6

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

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

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

Global market . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VII-8
iii

CONTENTS - Continued

Page

Appendixes

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

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

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

D. Responses to questions concerning SDGE and LDGE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . D-1

E. Weighted-average delivered sales prices of pricing products imported from 

 nonsubject countries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . E-1

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

 efforts, growth, investment, and ability to raise capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-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.
 
 1

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

 2

 The Commission also finds that imports subject to Commerce's affirmative critical circumstances determination

are not likely to undermine seriously the remedial effect of the antidumping duty order on China.

UNITED STATES INTERNATIONAL TRADE COMMISSION

Investigation No. 731-TA-1143 (Final)

SMALL DIAMETER GRAPHITE ELECTRODES FROM CHINA

DETERMINATION

On the basis of the record1

 developed in the subject investigation, the United States International

Trade Commission (Commission) determines, pursuant to section 735(b) of the Tariff Act of 1930 (19

U.S.C. § 1673d(b)) (the Act), that an industry in the United States is materially injured by reason of

imports from China of small diameter graphite electrodes, provided for in subheading 8545.11.00 of the

Harmonized Tariff Schedule of the United States, that have been found by the Department of Commerce

(Commerce) to be sold in the United States at less than fair value (LTFV).2

BACKGROUND

The Commission instituted this investigation effective January 17, 2008, following receipt of a

petition filed with the Commission and Commerce by SGL Carbon LLC, Charlotte, NC, and Superior

Graphite Co., Chicago, IL. The final phase of the investigation was scheduled by the Commission

following notification of a preliminary determination by Commerce that imports of small diameter

graphite electrodes from China were being sold at LTFV within the meaning of section 733(b) of the Act

(19 U.S.C. § 1673b(b)). Notice of the scheduling of the final phase of the Commission’s investigation

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

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

notice in the Federal Register of September 4, 2008 (73 FR 51647). The hearing was held in

Washington, DC, on January 6, 2009, and all persons who requested the opportunity were permitted to

appear in person or by counsel.
 
 1

 See Separate and Concurring Views of Commissioner Charlotte R. Lane on this issue.

 2

 The Commission also received questionnaire responses from C/G Electrodes LLC (“C/G”) and Showa Denko

Carbon, Inc. (“Showa”) domestic producers of large diameter graphite electrodes (“LDGE”).

 3

 19 U.S.C. § 1677(4)(A).

 4

 19 U.S.C. § 1677(4)(A).

 5

 19 U.S.C. § 1677(10).

3

VIEWS OF THE COMMISSION

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

States is materially injured by reason of imports of small diameter graphite electrodes (“SDGE”) from

China that are sold in the United States at less than fair value (“LTFV”). We also determine that critical

circumstances do not exist with respect to the subject imports from China covered by the Department of

Commerce’s (“Commerce”) affirmative critical circumstances determination.1

I. BACKGROUND

The petition in this investigation was filed on January 17, 2008, by SGL Carbon LLC (“SGL

Carbon”) and Superior Graphite Company (“Superior”) (collectively “Petitioners”). The Petitioners

represented 100 percent of SDGE production in the United States during the period of investigation. 

Representatives from both producers appeared at the hearing and filed joint briefs.

Eight Chinese producers/exporters of the subject merchandise (Bejing Fangda Carbon Tech Co.,

Ltd.; Chengdu Rongguang Carbon Co., Ltd.; Fangda Carbon New Material Co., Ltd.; Fushun Carbon Co.,

Ltd.; Guangshan Shida Carbon Co., Ltd.; Hefei Carbon Co., Ltd; GES (China) Co., Ltd.; and Jilin Carbon

Import & Export Company) and representatives of five importers of the subject product (Ameri-Source

Speciality Products; Ceramark Technology Inc.; Fedmet Resources Corp.; Graphite Electrode Sales, Inc.;

and M. Brashem, Inc.) appeared at the hearing and submitted briefs in this investigation (all participating

Chinese producers/exporters and importers are referred to collectively as “Respondents”). 

The Commission received questionnaire responses from U.S. SDGE producers SGL Carbon and

Superior.2

 The Commission also sent foreign producer/exporter questionnaires to 125 firms identified as

producers or exporters of SDGE in China. Thirteen firms responded to the Commission’s foreign

producer questionnaires. The responding firms reported that they accounted for nearly *** percent of

production of SDGE in China during 2007, and nearly *** percent of exports from China to the United

States of SDGE during 2007.

II. DOMESTIC LIKE PRODUCT AND DOMESTIC INDUSTRY

A. In General

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

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

“domestic like product” and the “industry.”3

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

(“the Tariff Act”), defines the relevant domestic industry as the “producers as a [w]hole of a domestic like

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

proportion of the total domestic production of the product.”4

 In turn, the Tariff Act defines “domestic like

product” as “a product which is like, or in the absence of like, most similar in characteristics and uses

with, the article subject to an investigation. . . .”5
 6

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

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

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

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

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

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

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

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

Trade 1996).

 7

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

 8

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

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

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

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

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

 9

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

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

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

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

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

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

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

found five classes or kinds).

4

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

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

characteristics and uses” on a case-by-case basis.6

 No single factor is dispositive, and the Commission

may consider other factors it deems relevant based on the facts of a particular investigation.7

 The

Commission looks for clear dividing lines among possible like products and disregards minor variations.8

Although the Commission must accept Commerce’s determination as to the scope of the imported

merchandise subsidized or sold at LTFV,9

 the Commission determines what domestic product is like the

imported articles Commerce has identified.10

B. Product Description

In its final antidumping duty determination, Commerce defined the imported merchandise within

the scope of the antidumping duty investigation as follows: 

The merchandise covered by this investigation includes all small diameter graphite

electrodes of any length, whether or not finished, of a kind used in furnaces, with a

nominal or actual diameter of 400 millimeters (16 inches) or less, and whether or not

attached to a graphite pin joining system or any other type of joining system or hardware. 

The merchandise covered by this investigation also includes graphite pin joining systems

for small diameter graphite electrodes, of any length, whether or not finished, of a kind

used in furnaces, and whether or not the graphite pin joining system is attached to, sold

with, or sold separately from, the small diameter graphite electrode. Small diameter

graphite electrodes and graphite pin joining systems for small diameter graphite

electrodes are most commonly used in primary melting, ladle metallurgy, and specialty

furnace applications in industries including foundries, smelters, and steel refining

operations. Small diameter graphite electrodes and graphite pin joining systems for small
 11 74 Fed. Reg. 2049 (Jan. 14, 2009). In the preliminary determination, the scope had been limited to SDGE,

including SDGE with an attached pin joining system. In its final determination, Commerce expanded the scope to

include all graphite electrode joining pins as an anti-circumvention measure.

 12 Confidential Staff Report (“CR”) at I-7, Public Staff Report (“PR”) at I-6.

 13 CR at I-8-I-9, PR at I-7.

 14 CR at I-11, PR at I-8.

 15 CR/PR at III-1 n. 1.

 16 CR/PR at III-1 n. 1. 

 17 Importer and Foreign Producer Questionnaires.

5

diameter graphite electrodes that are subject to this investigation are currently classified

under the Harmonized Tariff Schedule of the United States (HTSUS)

subheading 8545.11.0000. The HTSUS number is provided for convenience and customs

purposes, but the written description of the scope is dispositive.11

SDGE are cylindrical in shape and are produced in a variety of diameters and lengths. They

conduct electricity at very high currents to generate heat necessary to melt and/or further refine steel. 

They are used in various applications including certain electric arc furnaces in steel-making mini-mills;

their uses include ladle metallurgy, primary low-duty melting, and specialty furnace applications.12

Typically, electrodes are joined in columns with a threaded graphite pin joining system (also known as a

pinning or connecting system). Because of the intensity of the melting process in steel production, the

electrodes are continuously consumed.13

SDGE are manufactured from a range of petroleum coke grades, from low grade anode coke to

premium high grade needle coke. The grade of coke, along with other characteristics such as size and

impregnation, determines the level of current an electrode can carry.14 SDGE are produced in a variety of

grades.15 Although domestic producers indicated that they can produce the full range of all grades and

sizes of SDGE, they only produced SDGE in 8 inch to 16 inch diameters during the period of

investigation.16 Importers reported that Chinese SDGE is sold in all diameters and sizes in the U.S.

market.17

C. Preliminary Determination

In the preliminary phase of this investigation, Petitioners proposed defining a single domestic like

product coextensive with the scope. Respondents urged the Commission to define the domestic like

product to include all graphite electrodes, including LDGE (graphite electrodes in diameters greater than

16 inches), which are not within the scope.

In its preliminary determination, the Commission defined the domestic like product as SDGE

corresponding to the scope. In so doing, the Commission found that there were both differences and

similarities between SDGE and LDGE. The Commission found that both are produced from various

grades and mixes of petroleum coke, and both act as conductors of electricity, regardless of their size and

quality, to generate heat sufficient to melt steel or other metals. It observed that SDGE generally could

not be interchanged for LDGE in steel-making applications, but noted that the interchangeability of all

graphite electrodes is largely limited to adjacent diameter sizes. It also found that SDGE and LDGE were

manufactured by the same production processes, manufactured on the same equipment by the only

producer of both, and for the most part sold through the same channels of distribution. The Commission

also found the record to be mixed as to whether producers perceived SDGE and LDGE to be different

products; it noted that there was only limited information concerning customer perceptions, which the
 18 Small Diameter Graphite Electrodes from China, Inv. No. 731-TA-1143 (Preliminary), USITC Pub. 3985 (Mar.

2008) (“USITC Pub. 3985”) at 6-8. 

 19 USITC Pub. 3985 at 9.

 20 USITC Pub. 3985 at 9.

 21 CR at I-7, PR at I-6.

 22 CR at I-8, PR at I-7, Petitioners’ Prehearing Brief at 17.

 23 CR at I-10, PR at I-8.

 24 Petitioners’ Posthearing Brief at Question 1, p. 3.

 25 CR at I-10, PR at I-8.

 26 SDGE generally are produced in regular power (“RP”), normal power (“NP”), medium power (“MP”), high

power (“HP”), super high power (“SHP”) and ultra high power (“UHP”) grades. SDGE generally are sold in

diameter increments of 2 inches, ranging from 2 inches through 16 inches. The majority of LDGE are produced in

the UHP grade while some LDGE are produced in the HP and SHP grades. CR at I-10, PR at I-8. The grades are not

(continued...)

6

Commission deemed to be a critical factor.18 Finally with respect to price, the Commission noted that,

although Petitioners indicated that SDGE prices were lower than those for LDGE, it appeared that this

may be true within the entire range of graphite electrodes, as the larger the diameter and length, the higher

the price of the electrode.19 The Commission concluded as follows:

while it is a close question, we define the domestic like product to be SDGE. In any final phase

investigation, we intend to collect additional information, particularly from purchasers

concerning their perceptions of the products, and to revisit the issue of whether SDGE and LDGE

should be characterized as a continuum of products without a clear dividing line.20

D. Domestic Like Product

In this final phase, Petitioners again argue that the Commission should find one domestic like

product consisting of SDGE, coextensive with Commerce’s scope. They stress that there are pronounced

differences between SDGE and LDGE. Respondents, however, argue that the domestic like product

should be expanded to include SDGE and LDGE because they form a continuum of the same product,

graphite electrodes.

Accordingly, we consider whether the product should be broadened beyond the scope to include

LDGE. For the reasons discussed below, we find a single domestic like product consisting of only

SDGE.

Physical Characteristics and End Uses. Both SDGE and LDGE share a number of physical

characteristics and uses. As the Commission found in its preliminary determination, SDGE and LDGE

are smooth, cylindrical in shape, and are produced from coke that is formed into shape by extrusion into

an electrode of the desired grade, diameter, and length.21 Both LDGE and SDGE are joined in columns,

each by a threaded graphite connecting system, most commonly a graphite pin. The strengths of the pins

for SDGE and LDGE differ and pins designed for LDGE must be stronger and have a lower coefficient of

thermal expansion than that for SDGE to prevent breakage of the pin.22 SDGE usually are produced from

a range of different grades of petroleum coke, from low grade anode coke to premium high grade needle

coke or a blend of the two.23 Superior, which produces only SDGE, reports that ***. SGL Carbon, which

produces 14 to 16 inch SDGE as well as LDGE, makes its SDGE from ***.24 LDGE, on the other hand,

generally are made from premium needle coke.25 SDGE are generally produced in six different grades,

while LDGE are typically produced in the three highest of the six grades.26
 26 (...continued)

drawn to any industry standard, but are primarily a marketing tool. CR at I-10 n. 30, PR at I-8 n. 30. The UHP

grade uses 100 percent needle coke.

 27 CR at I-11, CR/PR Table I-2, PR at I-8.

 28 Other uses include smelter uses, fused metal oxide production, waste recovery, waste encapsulation, and other

minor furnace applications. CR at I-9 n. 21, PR at I-7 n. 21.

 29 CR at III-6 n. 5, PR at III-3.

 30 CR at I-9, PR at I-7.

 31 CR at I-9, PR at I-7.

 32 Transcript at 19 (Stinson).

7

The grades of coke used to produce LDGE and SDGE, along with other physical characteristics,

such as size and degree of impregnation, determine the amount of current the electrode can carry. As

such, SDGE typically have lower current carrying capacity, ranging from currents of 15,000 to 60,000

amps and not exceeding 70,000 amps. LDGE can carry currents of 60,000 to 160,000 amps. However,

while SDGE and LDGE have differing current capabilities, the same is also true for diverse sizes within

each group of products; common current capability is only present within adjacent sizes. Other important

physical characteristics of graphite electrodes include bulk density, specific electrical resistance,

coefficient of thermal expansion, and flexural strength, and the ranges of each of these physical

characteristics for SDGE and LDGE may vary.27

Both SDGE and LDGE are used as conductors of electricity in electric furnaces, such as electric

arc furnaces (“EAFs”) in steel mini-mills and foundries. Both groups of products conduct electricity at

high currents to generate heat necessary to melt and further refine steel or other metals. SDGE, however,

due to their lower current carrying capacity and coke make-up, are generally used in ladle steel refining,

foundries, and specialty furnace applications.28 They are used only rarely to melt steel scrap in mini-mill

EAFs, and then only in older and smaller EAFs. In contrast, because of their higher current carrying

capability and their coke make-up (premium needle coke), LDGE are used almost exclusively in higher

intensity uses, in particular, steel melting in large electric arc furnaces. The record indicates that SDGE

cannot be used in new electric arc furnaces as these furnaces do not utilize graphite electrodes in

diameters under 24 inches due to the high currents involved in such operations (over 100,000 amps). The

record indicates that *** percent of LDGE are used for steel melting in large electric arc furnaces, with

only *** percent of LDGE used in secondary ladle and refining operations. Although a portion of LDGE

in 18-inch diameters are used in ladle applications, *** LDGE in 20-inch diameters and above are used in

steel melting applications.29

Interchangeability. The record indicates that the design of the equipment that uses the electrodes

determines the optimum electrode diameter based on electrical and operating specifications.30 There is

some evidence on the record suggesting that it may be possible to utilize an adjacent diameter size by

converting the equipment that holds the electrodes in place and changing the electrical output of the

furnace. Such conversion, while possible, would likely be cost-prohibitive and might be unsafe.31

Although Petitioners indicated that it was possible to shift between adjacent sizes, they testified that

SDGE cannot be interchanged for LDGE, as LDGE are produced to withstand stress-intensive

applications and to prevent breakage in electric arc furnaces.32

The interchangeability of SDGE and LDGE in high current or voltage applications also appears

to be limited by the type of grade of petroleum coke used in producing each type. The record indicates
 33 Petitioners’ Prehearing Brief at 12-15, Transcript at 19 (Stinson).

 34 When an electrode breaks in an EAF it is very costly to steel producers because of furnace downtime and

subsequent significant delays in processing the affected batch of steel. The lower currents in ladle furnaces make it

less likely that electrodes will break. Hearing Transcript at 35 (McClintock), Staff Notes from SGL Carbon plant

tour (Dec. 3, 2008) EDIS number 317083.

 35 CR at D-21 ***, PR at D-4.

 36 CR at D-24 ***, PR at D-4.

 37 CR/PR at II-1.

 38 CR at I-12-I-15, PR at I-9-I-11. 

 39 CR/PR at D-3.

 40 Transcript at 92 (Stinson).

 41 Respondents’ Posthearing Brief at 6.

8

that high grade needle coke used in LDGE is more suitable for high intensity applications because it

makes the LDGE less likely to break apart in the electric arc furnace.33 34 ***.35 Similarly, ***.36

Channels of Distribution. *** LDGE were sold directly to end users in 2007, while nearly ***

percent of SDGE were sold to distributors and *** percent were sold to end users.37

Manufacturing Facilities, Production Processes, and Employees. Both SDGE and LDGE share

similar production processes at the formation stage. All graphite electrodes are made from petroleum

coke that is shaped by extrusion into electrodes of various diameters and lengths. The formed electrodes

are then baked. After the initial baking, however, the production processes for SDGE and LDGE may

differ. Once the electrode undergoes initial baking, it may be impregnated with tar pitch and then

rebaked, filling pores to increase its density and strength. LDGE, which require higher stress tolerances,

are always impregnated at least once, but SDGE are not always impregnated. The baked electrodes are

then heated in a furnace to extremely high temperatures of up to 3,000 degrees centigrade, and then are

transformed into graphite, a process known as graphitization. Unfinished SDGE undergo no further

processing beyond the graphitization stage other than machining, while LDGE may be rebaked. All

graphite electrodes are cooled and may then go to a final stage to be machined to exact dimensions and

tolerances. The final stage may include machining and fitting the pinning system.38

The record indicates that there is a limited current overlap in manufacturing facilities between

SDGE and LDGE. Superior, which produces only SDGE, is not able to produce LDGE on the equipment

it uses to produce SDGE, due to the necessary size differences in equipment such as ***. Showa and

C/G, currently manufacturers of LDGE only, once produced SDGE on the same equipment on which they

now produce LDGE. ***.39 SGL Carbon, the only producer of both SDGE and LDGE during the period

of investigation, is able to produce both products on the same equipment using the same employees.40

Producer and Customer Perceptions. There are no industry standards that establish a specific

diameter distinction between LDGE and SDGE. In their marketing literature, Showa and C/G refer to

themselves as producers of large graphite electrodes and Superior refers to itself as a producer of small

graphite electrodes. On the other hand, SGL Carbon, the only producer of both LDGE and SDGE, does

not advertise itself as such. Respondents indicated that according to SGL Carbon’s website, SGL Carbon

states that it produces electrodes ranging in size from 14" to 32" diameter and designates 14" to 24" in

diameter as regular-sized electrodes and 26" to 32" in diameter electrodes as extra-sized electrodes.41 In
 42 CR at D-3-D-6, PR at D-4.

 43 *** responded that SDGE are used on *** while LDGE are used on EAF furnaces. *** responded that while

both sizes are used for heating and refining, only LDGE are used for melting. *** answered that SDGE and LDGE

have “[t]otally different applications.” See CR at D-17-D-27, PR at D-4. *** noted that each mill with a ladle

furnace buys electrodes independently but electrodes for EAFs are purchased on a corporate basis. See CR at D-24,

PR at D-4 (Question III-10). As noted previously, most ladle furnaces use SDGE and most EAFs use LDGE. 

 44 CR/PR at Table I-3.

 45 Petitioners’ Prehearing Brief at 34.

 46 Respondents’ Prehearing Brief at 21.

 47 Respondents’ Prehearing Brief at 21.

 48 Petitioners’ submission of Feb. 15, 2008, CR at III-6 n.5, and PR at III-3 n.5.

9

***, however, *** indicated that they perceived SDGE and LDGE to be different products as SDGE and

LDGE are used in different applications.42

With respect to customer perceptions, we note that customer responses were mixed. Of the

purchasers that provided an opinion, nine indicated that SDGE and LDGE are never or rarely comparable

as to physical characteristics and uses, while eight indicated that SDGE and LDGE are mostly or

somewhat comparable. Customers’ detailed written responses, however, tend more to support the view

that SDGE and LDGE have different end uses.43

Price. The record shows that the average unit values for SDGE during the period of investigation

were *** the average unit values for LDGE.44 Domestic producers, importers and purchasers agree that

SDGE are typically lower priced than LDGE, reflecting differences in the products’ composition and

physical characteristics.45 Respondents are correct that the larger the diameter, the more costly to produce

and the higher the price of the electrode.46 Respondents acknowledge, however, that the higher prices for

LDGE compared to SDGE are largely due to the higher cost of premium needle coke, a raw material

necessary for LDGE’s higher intensity applications.47

Analysis and Conclusion

While we find the issue to be a close one, we conclude on balance that the record merits limiting

the domestic like product to SDGE. There are a number of ways in which SDGE and LDGE might be

viewed as forming a continuum, including that price, current carrying capacity, and premium needle coke

content all tend to increase with the size of the electrode and electrodes of adjacent sizes are most

comparable with respect to these attributes. Nevertheless, there are several salient features of graphite

electrodes that we find establish a clear dividing line between SDGE and LDGE at 16 inches in diameter. 

Specifically, there is very little overlap in end uses between SDGE and LDGE. SDGE are used generally

in foundry, specialty furnace applications and steel mill ladle applications. In contrast, *** of LDGE are

used for primary melting of steel scrap in mini-mill electric arc furnaces, with only *** percent going into

a limited number of steel refining ladles.48 Second, there is very limited overlap in manufacturing

facilities and equipment that produce SDGE and LDGE, with only one of four domestic manufacturers of

graphite electrodes currently able to make both products. Third, although interchangeability of all

graphite electrodes is generally limited to adjacent diameter sizes, SDGE cannot be substituted for LDGE

in heavy melting applications due to coke content and other physical characteristics. Finally, although

purchasers identify similarities between SDGE and LDGE, they widely acknowledge that they do not use
 49 CR at D-17-D-27.

 50 Both Petitioners and Respondents have cited a number of prior investigations to support their differing

positions as to the appropriate definition of the domestic like product in this investigation, many of which they cited

to in their briefs submitted in the preliminary phase of this investigation. The cited investigations generally address

such issues as whether the domestic like product should encompass products not within the scope and whether a

continuum of products within the scope should be divided into separate domestic like products. We noted the

following in the preliminary determination:

[D]eterminations defining the domestic like product in other investigations of differing products

have little utility as each determination is based on the record of each case, including the

arguments made by the parties. Certain Aluminum Plate From South Africa, Inv. 731-TA-1056

(Preliminary) USITC Pub. 3654 (Dec. 2003) at n. 59, citing Nippon Steel Corp. v. United States,

19 CIT 450, 454-55 (1995); Citrosuco Paulista, S.A. v. United States, 704 F. Supp. 1075,1087-88

(CIT 1988); Asociacion Colombiana de Exportadores de Flores v. United States, 693 F. Supp.

1165, 1669 n.5 (CIT 1988). Moreover, the cases that discuss whether a continuum of products

included in the scope should be divided into separate like products are unpersuasive here. The

inquiry in this matter is how to treat a continuum of products in the context of whether to define

the domestic like product to encompass articles outside the scope. In cases such as the one

presented in this matter, the Commission “is faced with determining where the continuum line

ends.” Aluminum Plate at 11 n.59, citing Minivans from Japan, Inv. No. 731-TA-522 (Final),

USITC Pub. 2529 at 6 (July 1992). 

 USITC Pub. 3985 at 9 n.46. 

 51 19 U.S.C. § 1677(4)(A).

10

SDGE and LDGE for the same applications, often purchase them in separate transactions and note that

the level of technical support and service for SDGE and LDGE may vary.49

On balance, we find a clear dividing line between SDGE and LDGE and we decline to expand the

domestic like product beyond the scope of the investigation to include all graphite electrodes. We

therefore define the domestic like product as all SDGE coextensive with the scope.50

E. Domestic Industry

The domestic industry is defined as the domestic “producers as a [w]hole of a domestic like

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

proportion of the total domestic production of the product.”51 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.

Accordingly, consistent with our definition of the domestic like product, we define the domestic industry

as all domestic producers of SDGE, that is SGL and Superior.
 52 Negligibility is not an issue in this investigation under 19 U.S.C. § 1677(24). According to the compilation of

questionnaire data and official import statistics, it appears that subject imports from China were well above three

percent of total imports for the most recent 12-month period preceding the filing of the petition for which data are

available. Specifically, subject imports from China accounted for *** percent of total imports of the merchandise in

that period. CR at IV-5, PR at IV-3. 

 53 19 U.S.C. §§ 1671d(b) and 1673d(b).

 54 19 U.S.C. § 1677(7)(B)( i). The Commission “may consider such other economic factors as are relevant to the

determination” but shall “identify each [such] factor . . . [a]nd explain in full its relevance to the determination.”

19 U.S.C. § 1677(7)(B).

 55 19 U.S.C. § 1677(7)(A).

 56 19 U.S.C. § 1677(7)(C)(iii).

 57 19 U.S.C. § 1677(7)(C)(iii).

 58 19 U.S.C. § 1673d(b).

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

‘compel the commissioners’ to employ [a particular methodology] . . . [however] regardless of what approach is

used, whether it be the two-step or unitary approach or some other approach, the three mandatory factors must be

considered in each case”), aff’g 944 F. Supp. 943, 951 (Ct. Int’l Trade 1996).

 60 The Federal Circuit, in addressing the causation standard of the statute, observed that “[a]s long as its effects

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

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

Nippon Steel Corp. v. United States, 458 F. 3d 1345, 1357 (Fed. Cir. 2006), where the court stated that the

“causation requirement is met so long as the effects of dumping are not merely incidental, tangential, or trivial.” See

also Taiwan Semiconductor Industry Ass’n v. USITC, 266 F.3d 1339, 1345 (Fed. Cir. 2001)(“to ensure that the

subject imports are causing the injury, not simply contributing to the injury in a tangential or minimal way.”); Gerald

(continued...)

11

III. MATERIAL INJURY BY REASON OF SUBJECT IMPORTS 52

A. Legal Standards

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

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

injury by reason of the imports under investigation.53 In making this determination, the Commission must

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

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

operations.54 The statute defines “material injury” as “harm which is not inconsequential, immaterial, or

unimportant.”55 In assessing whether the domestic industry is materially injured by reason of subject

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

States.56 No single factor is dispositive, and all relevant factors are considered “within the context of the

business cycle and conditions of competition that are distinctive to the affected industry.”57

The statute requires the Commission to determine whether the domestic industry is “materially

injured by reason of” unfairly traded imports.58 The statute, however, does not define the phrase “by

reason of,” indicating that this aspect of the injury analysis is left to the Commission’s reasonable

exercise of its discretion.59 In identifying a causal link, if any, between subject imports and material

injury to the domestic industry, the Commission examines the facts of record that relate to the

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

condition of the domestic industry. This evaluation must ensure that subject imports are more than a

minimal or tangential cause of material injury and that there is a sufficient causal nexus between subject

imports and material injury.60 Thus, the Commission interprets the “by reason of” language in a manner
 60 (...continued)

Metals, Inc. v. United States, 132 F.3d 716, 722 (Fed. Cir. 1997)(“the statute requires adequate evidence to show

that the harm occurred ‘by reason of’ the LTFV imports, not by reason of a minimal or tangential contribution to

material harm caused by LTFV goods.”); Mittal Steel Point Lisas Ltd. v. United States, 542 F.3d 867, 873 (Fed. Cir.

2008).

 61 Statement of Administrative Action (“SAA”) on Uruguay Round Agreements Act (URAA), H.R. Rep. 103-

316, Vol. I at 851-52 (1994) (“[T]he Commission need not isolate the injury caused by other factors from injury

caused by unfair imports. . . Rather, the Commission must examine other factors to ensure that it is not attributing

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

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

317 at 47 (1979) (“in examining the overall injury being experienced by a domestic industry, the ITC will take into

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

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

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

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

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

The Federal Circuit has affirmed the following: “[T]he Commission need not isolate the injury caused by

other factors from injury caused by unfair imports. . . . Rather, the Commission must examine other factors to ensure

that it is not attributing injury from other sources to the subject imports.” Taiwan Semiconductor Industry Ass’n v.

USITC, 266 F.3d 1339, 1345 (Fed. Cir. 2001)(emphasis in original); Asociacion de Productores de Salmon y Trucha

de Chile AG v. United States 180 F. Supp. 2d 1360, 1375 (Ct. Int’l Trade 2002) (“[t]he Commission is not required

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

between the effects of subject imports and other causes.). See also Softwood Lumber from Canada, Inv. Nos. 701-

414 and 731-TA-928 (Remand), USITC Pub. 3658 at 100-01 (Dec. 2003) (Commission recognized that “[i]f an

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

‘other causal factor,’ then there is nothing to further examine regarding attribution to injury”), citing Gerald Metals,

Inc. v. United States, 132 F.3d 716, 722 (Fed. Cir. 1997) (the statute “does not suggest that an importer of LTFV

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

contributed to the harmful effects on domestic market prices.”).

 62 See SAA at 851-52, 885.

 63 S. Rep. 96-249 at 74-75; H.R. Rep. 96-317 at 47; see also Nippon Steel Corp., 345 F.3d at 1381 (“[D]umping

need not be the sole or principal cause of injury.”).

12

that implements the statutory requirement of finding a causal, not merely a temporal, link between the

subject imports and the material injury to the domestic industry.

In many investigations, there are other economic factors that also may be causing injury to the

domestic industry. The legislative history explains that the Commission must examine factors other than

subject imports to ensure that it is not attributing injury from these sources to the subject imports, but

does not require the Commission to isolate the injury caused by other factors from injury caused by unfair

imports.61 The statutory scheme clearly contemplates that an industry may be facing difficulties from a

variety of sources, including non-subject imports and other factors, but the existence of injury caused by

other factors does not compel a negative determination if the subject imports themselves are making more

than a minimal or tangential contribution to material injury.62 The legislative history further clarifies that

subsidized imports need not be the “principal” cause of material injury and that the “by reason of”

standard does not contemplate that injury from subsidized imports be weighed against other factors, such

as non-subject imports, which may be contributing to overall injury to an industry.63

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

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

injury to the domestic industry can reasonably be attributed to the subject imports” and the Commission
 64 Mittal Steel, 542 F.3d at 877-878; see also id at 873 (“While the Commission may not enter an affirmative

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

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

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

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

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

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

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

 66 Mittal Steel, 542 F.3d at 875-879.

 67 Chairman Aranoff, Vice Chairman Pearson, and Commissioners Okun and Lane note that the Federal Circuit’s

decisions in Gerald Metals, Bratsk, and Mittal Steel all involved cases where the relevant “other factor” was the

presence in the market of significant volumes of price competitive non-subject imports. The Commission interpreted

the Federal Circuit’s very specific instructions in Bratsk as requiring it to apply a particular additional methodology

following its finding of material injury in cases involving commodity products and a significant market presence of

price-competitive non-subject imports. The additional “replacement/benefit” test looked at whether non-subject

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

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

and Tobago determination that underlies the Mittal Steel litigation.

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

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

Commission need only ensure that subject imports are a substantial factor (as opposed to a merely incidental,

tangential, or trivial factor) in the injury to the domestic industry, and not attribute injury from non-subject imports

or other factors to subject imports. See Mittal Steel Point Lisas Ltd. v. United States, 542 F.3d 867, 875-879 and n.2

(recognizing the Commission’s alternative interpretation of Bratsk as a reminder to conduct a non-attribution

analysis) (Fed. Cir. 2008). Accordingly, we do not consider ourselves required to apply the replacement/benefit

analysis that has characterized the Commission’s recent opinions.

What we can discern from the progression of Gerald Metals, Bratsk, and Mittal Steel is that, in cases

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

market, the Court will require the Commission to give full consideration to the causation and non-attribution issues

and that its explanation will have to be sufficiently cogent and persuasive to survive the court’s scrutiny.

 68 Commissioner Pinkert does not join in this sentence or in the preceding footnote. He points out that the Federal

Circuit, in Bratsk Aluminum Smelter v. United States, 444 F.3d 1369 (Fed. Cir. 2006) and Mittal Steel, held that the

Commission is required, in certain circumstances, to undertake a particular kind of analysis of non-subject imports. 

Mittal Steel explains as follows:

What Bratsk held is that “where commodity products are at issue and fairly traded, price competitive, nonsubject imports are in the market,” the Commission would not fulfill its obligation to consider an important

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

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

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

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

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

that factor.

542 F. 3d at 878.

(continued...)

13

“ensure[s] that it is not attributing injury from other sources to the subject imports.”64 Indeed, the Federal

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

adherence to a specific formula.”65 The Federal Circuit has provided guidance on the questions that it

would raise and expect the Commission to have considered in its analysis “where commodity products are

at issue and fairly traded, price competitive, non-subject imports are in the market.”66 67 68 69 Nonetheless,
 68 (...continued)

Based on the record evidence in the final phase of this investigation, Commissioner Pinkert finds that the

subject merchandise is not a commodity product. It is customized for each purchaser, and such customization

involves mixing various types of coke, especially anode and needle coke, not all of which are available to each

supplier. Because a Bratsk replacement/benefit analysis is not required with respect to a product that is not a

commodity, Commissioner Pinkert declines to perform one here. 

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

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

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

 70 Mittal Steel, Slip Op. 2007-1552 at 9-10; Nippon Steel Corp., 458 F.3d at 1350, citing U.S. Steel Group, 96

F.3d at 1357; S. Rep. 96-249 at 75 (“The determination of the ITC with respect to causation is . . . complex and

difficult, and is a matter for the judgment of the ITC.”).

 71 CR/PR at II-1.

 72 CR/PR at Tables IV-3 and C-1.

 73 CR/PR at Table IV-3 and C-1. 

 74 CR at II-6, PR at II-4.

 75 CR at II-6, PR at II-4.

14

the question of whether one out of several possible causes of injury exceeds the minimal or tangential

threshold and is an independent cause of material injury to the domestic industry is left to the expertise of

the Commission. The finding as to whether the threshold is satisfied is a factual one, subject to review

under the substantial evidence standard. Congress has delegated these factual findings to the Commission

because of the agency’s institutional expertise in resolving injury issues.70

B. Conditions of Competition and the Business Cycle

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

by reason of subject imports.

1. Demand Considerations

The demand for SDGE is largely determined by the demand for steel.71 Apparent U.S.

consumption of SDGE fluctuated during the period of investigation, but increased overall by *** percent. 

Apparent U.S. consumption increased *** from *** metric tons in 2005 to *** metric tons in 2006 (an

increase of *** percent), then declined to *** metric tons in 2007 (a decrease of *** percent), but

remained *** above the 2005 levels.72 Apparent U.S. consumption was *** lower during JanuarySeptember 2008 than during the same period in 2007.73 The increase in demand during the period of

investigation was most commonly attributed by U.S. producers and importers to increased steel

production.74 Indeed, much of the period of investigation represented a boom period for domestic steel

production, leading to increased demand for SDGE from the existing mills and the reopening of old

integrated steels mills.75

2. Supply Conditions

As noted earlier, the domestic industry consists of SGL Carbon and Superior. Both SGL Carbon

and Superior reported that they were capable of producing the full range of grades and sizes of SDGE. 

SGL Carbon reported that it currently produces SDGE in diameters of 14 and 16 inches. According to

SGL Carbon, it ceased production of SDGE in diameters of 10 inches and 12 inches in 2006 due to

competition from Chinese imports in those diameters. Superior reported that it currently produces SDGE
 76 CR/PR at Table III-2, CR at III-4 n.3, PR at III-2 n.3. ***. CR at III-4 n.3, PR at III-2 n.3.

 77 CR/PR at Table III-2.

 78 CR/PR at Table IV-4.

 79 CR/PR at Table IV-4.

 80 CR/PR at Table IV-4.

 81 CR/PR at V-1.

 82 CR/PR at V-1.

 83 CR at II-11, PR at II-7.

 84 CR at V-5, PR at V-3. 

15

in diameters from 8 inches to 16 inches. The domestic industry’s capacity to produce SDGE was steady

at *** metric tons in 2005 and 2006, but fell to *** metric tons in 2007.76 The domestic industry’s

capacity to produce SDGE was *** metric tons in interim 2008 compared to *** metric tons in interim

2007.77

During the period of investigation, the U.S. SDGE market was supplied by the domestic industry,

subject imports, and nonsubject imports. Despite overall increasing demand during the period of

investigation, the domestic industry’s share of the U.S. market declined from *** percent in 2005 to ***

percent in 2006 and to *** percent in 2007. The domestic industry’s share of the U.S. market was higher

at *** percent in interim 2008 compared to *** percent in interim 2007.78 In contrast, subject imports’

share of the U.S. market increased from *** percent in 2005 to *** percent in 2006 and to *** percent in

2007, and was higher at *** percent in interim 2008 compared to *** percent in interim 2007.79

Nonsubject imports’ share of the U.S. market fluctuated, increasing from *** percent in 2005 to ***

percent in 2006 and then decreasing to *** percent in 2007, but was lower at *** percent in interim 2008

compared to *** percent in interim 2007.80

As noted above, petroleum coke, either in the form of needle coke, anode coke, or other grades,

and petroleum pitch or coal tar pitch are the principal raw materials used in producing SDGE. Domestic

producers reported that there has been a limited supply of needle coke globally. The spot price for oil,

which determines the cost of the petroleum-based raw materials, increased by 122 percent from January

2005 to September 2008, having peaked in June 2008, but declined thereafter.81 Domestic producers

reported that their raw material costs have increased by *** percent on a per-unit basis from 2005 to

2007.82

3. Substitutability and Other Conditions

The record indicates that the domestic like product and subject imports are at least moderately

interchangeable. *** U.S. producers and a majority of importers reported that SDGE from China and

SDGE produced in the United States are frequently interchangeable. Nearly all of the responding

purchasers reported that SDGE from China and SDGE produced in the United States are always or

frequently interchangeable.83

*** subject imports are sold predominantly through short-term contracts or spot sales. With

respect to domestic producers, ***. With respect to importers, short-term contracts range in duration

from one month to one year. Importers’ contracts typically contain fixed price and quantity terms.84
 85 19 U.S.C. § 1677(7)(C)(i).

 86 CR/PR at Table IV-2.

 87 Calculated from CR/PR at Table IV-2.

 88 CR/PR at Table IV-2. U.S. shipments of subject imports followed a similar trend, increasing from *** metric

tons in 2005 to *** metric tons in 2006 and to *** metric tons in 2007, but were higher in interim 2008 at ***

metric tons (coinciding with importers’ decreasing inventories) than in interim 2007 at *** metric tons. CR/PR at

Tables IV-3 and C-1.

 89 CR/PR at Table IV-4.

 90 CR/PR at Table IV-5.

 91 CR/PR at Table IV-4.

 92 CR/PR at Table C-1.

 93 Nonsubject imports’ market share by quantity was *** percent in interim 2008 and *** percent in interim 2007. 

CR/PR at Table IV-4.

16

C. Material Injury By Reason of Subject Imports from China

1. Volume of the Subject Imports

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

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

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

significant.”85

The volume of subject imports, which was sizeable at the beginning of the period of

investigation,86 increased by 36.7 percent from 2005 to 2007.87 Subject imports increased from 10,082

metric tons in 2005 to 13,161 metric tons in 2006, then to 13,784 metric tons in 2007. In interim 2008,

subject imports were slightly lower, at 10,112 metric tons, compared to 10,458 metric tons in interim

2007.88 Subject imports also increased their market share. The market share of subject imports rose from

*** percent in 2005 to *** percent in 2007, and was higher at *** percent in interim 2008 compared to

*** percent in interim 2007.89 Additionally, the ratio of subject imports to U.S. production rose *** from

*** percent in 2005 to *** percent in 2007, but was lower in interim 2008, after the filing of the petition,

at *** percent compared to *** percent in interim 2007.90

Subject imports captured market share from the domestic industry despite overall rising demand

during the period of investigation. The domestic industry’s market share by quantity declined from ***

percent in 2005 to *** percent in 2006 (contrasting with *** increase in demand) to *** percent in 2007. 

The domestic industry’s market share was *** in interim 2008 at *** percent compared to *** percent in

interim 2007.91 At the same time, the domestic industry’s U.S. shipments declined in each year as subject

imports increased and demand increased overall from 2005 to 2007.92 By contrast, nonsubject imports’

market share by quantity followed the trend in demand, increasing from *** percent in 2005 to ***

percent in 2006, and decreasing to *** percent in 2007. Nonsubject imports’ market share was lower in

interim 2008 compared to interim 2007.93

We find that the volume of subject imports and the increase in that volume are significant, both in

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

2. Price Effects of the Subject Imports

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

provides that the Commission shall consider whether –
 94 19 U.S.C. § 1677(7)(C)(ii).

 95 CR at II-15, PR at V-7.

 96 CR/PR at Table II-5.

 97 CR/PR at Table II-6.

 98 CR at V-17, PR at V-7, CR/PR at Tables V-1-V-5. 

 99 CR/PR at Tables V-1-V-5. 

 100 CR/PR at Table V-8, CR at V-19-23, PR at V-8. We note that *** did not report specific lost sales

allegations, rather it reported that there are *** purchasers that ***. CR at V-19 and V-21, PR at V-7. 

 101 Petitioners’ Posthearing Brief at 42.

17

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

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

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

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

degree.94

As noted above, the domestic like product and subject imports are at least moderately 

interchangeable. The record indicates that price is an important factor in purchasing decisions. Notably,

a majority of purchasers reported that they viewed U.S. SDGE to be inferior to Chinese SDGE with

respect to price.95 Domestic producers and a majority of importers reported that non-price differences

between subject imports and the domestic like product were only *** in purchasing decisions. While a

sizeable minority of responding importers reported that non-price differences were always or frequently

an important factor,96 and almost all purchasers indicated that reliability, availability, product consistency,

and whether the quality meets industry standards were among the most important factors in purchasing

decisions in addition to price, few market participants could identify instances when Chinese imports

failed to satisfy quality and availability requirements.97

In this investigation, the Commission collected quarterly pricing data for five types of SDGE for

sales to both end users and distributors. The pricing data show pervasive underselling by subject imports. 

Subject imports undersold the domestic like product in 54 of 60 price comparisons by margins ranging

from 2.3 percent to 36.2 percent.98 Subject imports undersold the domestic like product in all quarterly

comparisons of products 1 and 2, in one of two quarterly price comparisons of product 3, in 13 of 14

quarterly price comparisons of product 4, and in 10 of 14 quarterly price comparisons for product 5.99 We

thus find that there has been significant underselling of the domestic like product by subject imports. 

 This underselling has had a direct effect on the domestic industry’s level of production and sales,

as well as its market share. While we consider the effects of subject imports on the domestic industry as a

whole, the two domestic producers that comprise the domestic industry faced somewhat different

conditions of competition during the period of investigation. Consequently, the effects of underselling on

the domestic industry differed with respect to the two domestic producers. Superior, which competes

head-to-head with subject imports for sales across most SDGE sizes, submitted evidence, ***, of lost

sales to low-priced imports totaling $***. These lost sales are *** given the relative size of the domestic

industry.100 Additionally, we find that SGL, rather than lowering its prices to meet subject import prices

and maintain customers for 10- and 12-inch diameter SDGE, made a business decision to cede its market

share for those products and to focus only on customers for whom Chinese quality was not yet

acceptable.101 Thus, the effects of underselling are in the lost volumes of domestic sales rather than in

direct effects on domestic prices.

Available data do not indicate that subject imports had significant depressing effects on domestic

prices, as domestic prices for all five products for which data were collected rose over the period of
 102 The price for the U.S.-produced product 1 increased by *** percent over the period, while the price for the

corresponding subject imports increased by *** percent. The price for the U.S.-produced product 2 increased by

*** percent; the price for the corresponding subject imports increased by *** percent. The price for U.S.-produced

product 3 increased by *** percent; the price for the corresponding subject imports increased by *** percent. The

price for U.S.-produced product 4 increased by *** percent; the price for the corresponding subject imports

increased by *** percent. Finally, the price for the U.S.-produced product 5 increased by *** percent; the price for

the corresponding subject imports increased by *** percent. CR at V-8-V-9, PR at V-5.

 103 CR at II-6, PR at II-4, CR/PR at V-1.

 104 CR at V-8, PR at V-5, CR/PR at Table V-7.

 105 Vice Chairman Pearson does not join this paragraph. He bases his finding of price effects on the evidence of

significant underselling and lost sales and revenue.

 106 CR/PR at Table C-1. 

 107 CR/PR at Table C-1. 

 108 The price-suppressing effects caused by subject imports may be obscured because SGL Carbon ceased

producing SDGE in 10-inch and 12-inch diameters *** due to subject imports and its move to higher value products. 

At the hearing, an SGL executive testified that it had shifted production to more intense and complex products that

Chinese suppliers could not satisfactorily produce. Hearing Transcript at 64 (Stinson). ***.

 109 Commissioner Pinkert joins the preceding footnote. In addition, for the reasons set forth below, he points out

that subject imports have suppressed domestic producer Superior’s prices to a significant degree. 

Superior’s COGS/sales ratio increased from 2005 to 2007, and was at *** levels, *** percent in 2006 and

*** percent in 2007, notwithstanding high demand levels. CR/PR at Tables IV-4, VI-2. In interim 2008, with the

pendency of the investigation, Superior’s COGS/sales ratio improved. Further, unlike SGL, Superior competes

directly against Chinese imports in a broad range of SDGE products, including sales of 10 and 12 inch SDGE. 

Prices for domestic 10 and 12 inch products (Products 1 and 2, respectively) remained at or below $*** from 2005

to 2007. CR/PR at Tables V-1 and V-2. This occurred in the face of increased costs. Thus, subject import prices

prevented price increases by Superior that would otherwise have occurred, to a significant degree, given high

demand and increasing costs.

 110 CR/PR at Table C-1.

18

investigation.102 These price increases reflect the high and rising demand for SDGE due to the boom in

steel production during the period, as well as the rising price of needle coke due to limited global

supply.103 Nonetheless, although the record reflects that most of the adverse effects of subject import

pricing appear in sales revenue data, we note that with respect to product 2, which constituted *** percent

of the quantity of product for which we received pricing data, and which had the largest margins of

underselling by subject imports, the increase in domestic prices was *** than for the other three

products.104

Similarly, although available data do not support a finding that subject imports suppressed

domestic prices to a significant degree over the full period of investigation, there is evidence that lowpriced subject imports have adversely affected domestic producers’ prices in certain instances.105 From

2005 to 2006, unit sales values increased by a greater percentage than unit cost of goods sold. In 2007,

however, unit sales values increased by less than the increase in unit COGS, despite continued strong

demand in that year.106 Consequently, the ratio of COGS to net sales rose from *** percent in 2006 to

*** percent in 2007,107 which, in light of strong demand, provides some evidence that subject imports had

a suppressing effect on domestic prices in 2007.108 109 Following the filing of the petition, prices of

subject imports and the domestic like product increased markedly in interim 2008. In interim 2008, the

domestic industry’s net sales values increased compared to interim 2007, and the domestic industry was

able to cover costs as U.S. shipments increased by a greater percentage than the increase in unit COGS.110
 111 CR/PR at Table VI-1.

 112 The statutory provision governing the Commission’s treatment of post-petition information, 19 U.S.C.

§ 1677(7)(I), states as follows:

[T]he Commission shall consider whether any change in the volume, price effects, or

impact of imports of the subject merchandise since the filing of the petition in an

investigation ... is related to the pendency of the investigation and, if so, the Commission

may reduce the weight accorded to the data for the period after the filing of the petition in

making its determination of material injury, threat of material injury, or material

retardation of the establishment of an industry in the United States.

See also Statement of Administrative Action to the Uruguay Round Agreements Act, H. Rep. 103-316, Vol. 1

(“SAA”) at 854 (1994). 

 113 The statute instructs the Commission to consider the “magnitude of the dumping margin” in an antidumping

proceeding as part of its consideration of the impact of imports. 19 U.S.C. § 1677(7)(C)(iii)(V). In its final

determination, Commerce calculated the final weighted-average dumping margins ranging from 132.90 percent to

159.64 percent. 74 Fed. Reg. 2049 (January 14, 2009).

 114 19 U.S.C. § 1677(7)(C)(iii); see also SAA at 851 and 885 (“In material injury determinations, the Commission

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

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

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

 115 19 U.S.C. § 1677(7)(C)(iii); see also SAA at 851, 885; Live Cattle from Canada and Mexico, Inv. Nos. 701-

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

19

The domestic industry’s COGS to net sales ratio was lower at *** percent in interim 2008 compared to

*** percent in interim 2007.111

While subject import prices for all five products increased over the period of investigation, *** of

this increase occurred in interim 2008, after the petition was filed. We attribute the increase in prices of

subject imports in interim 2008 and their diminishing impact on domestic prices for SDGE to the filing of

the petition in January 2008, and therefore accord less weight to the 2008 price data in our analysis.112

Accordingly, we find that there was significant underselling by subject imports and that this

underselling led to lost sales in 2006 and 2007. We also note that the underselling allowed subject

imports to gain market share at the expense of the domestic industry and that the domestic industry’s U.S.

shipments declined throughout the period of investigation, despite generally rising demand. We

consequently determine that subject imports had significant adverse price effects on the domestic

industry.

3. Impact of the Subject Imports on the Domestic Industry113

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

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

industry.”114 These factors include output, sales, inventories, ability to raise capital, research and

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

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

to the affected industry.”115

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

industry. These data indicate declining overall trends despite strong demand, although some indicators

fluctuated during this period before recovering *** during interim 2008, after the petition was filed. The

declines corresponded to increases in subject imports’ volume and market share, which were already

significant at the beginning of the period of investigation.
 116 CR/PR at Table C-1. Domestic production of SDGE decreased from *** metric tons in 2005 to *** metric

tons in 2006 and to *** metric tons in 2007. Domestic production was *** metric tons in interim 2008 and ***

metric tons in interim 2007. CR/PR at Table C-1.

 117 CR/PR at Table C-1. The domestic industry’s U.S. shipments decreased from *** metric tons in 2005 to ***

metric tons in 2006, and to *** metric tons in 2007. The domestic industry’s U.S. shipments were *** metric tons in

interim 2008 and *** metric tons in interim 2007.

 118 As noted in conditions of competition, the domestic industry’s capacity to produce SDGE was steady at ***

metric tons in 2005 and 2006, but fell to *** metric tons in 2007. CR at III-4 n.3, PR at III-2 n.3.

 119 CR/PR at Table C-1.

 120 CR/PR at Table C-1.

 121 CR/PR at Table C-1. The average number of production workers fell from *** in 2005 to *** in 2006 and to

*** in 2007. The average number of production workers was *** in interim 2007 and *** in interim 2008. CR/PR

at Table C-1. 

 122 CR/PR at Table C-1. Hours worked fell from *** in 2005 to *** in 2006 and to *** in 2007. Hours worked

were *** in interim 2007 and *** in interim 2008. CR/PR at Table C-1. Wages paid decreased from $*** in 2005

to $*** in 2006 and $*** in 2007. Wages paid were $*** in interim 2007 and $*** in interim 2008. CR/PR at

Table C-1. 

 123 CR/PR at Table C-1. Hourly wages increased from $*** in 2005 to $*** in 2006 and $*** in 2007. Hourly

wages were $*** in interim 2007 and $*** in interim 2008. CR/PR at Table C-1. 

 124 CR/PR at Table C-1. Unit labor costs increased from $*** in 2005 to $*** in 2006 and $*** in 2007. Unit

labor costs were $*** in interim 2007 and $*** in interim 2008. CR/PR at Table C-1. 

 125 CR/PR at Table C-1. Productivity decreased from *** metric tons per 1,000 hours in 2005 to *** metric tons

per 1,000 hours in 2006 and to *** metric tons per 1,000 hours in 2007. Productivity was *** metric tons per 1,000

hours in interim 2007 and *** metric tons per 1,000 hours in interim 2008. 

 126 CR/PR at Table C-1. Net sales by quantity decreased from *** metric tons in 2005 to *** metric tons in 2006

and to *** metric tons in 2007. Net sales by quantity were *** metric tons in interim 2007 and *** metric tons in

interim 2008. CR/PR at Table C-1. 

20

U.S. producers’ production, capacity utilization, and U.S. shipments all declined steadily from

2005 to 2006, but experienced some improvement when the interim periods are compared. Domestic

production of SDGE declined by *** percent from 2005 to 2007, but was higher in interim 2008

compared to interim 2007 as the influx of subject imports slowed and their prices increased after the filing

of the petition.116 The domestic industry’s U.S. shipments of SDGE declined each year for an overall

decline of *** percent and were higher in interim 2008 than in interim 2007.117 While the domestic

industry’s capacity remained flat throughout most of the period,118 capacity utilization followed

production trends, declining from 2005 to 2007, and was higher in interim 2008 compared to interim

2007.119 Capacity utilization decreased from *** percent in 2005 to *** percent in 2006 and to ***

percent in 2007, but was *** percent in interim 2008 compared to *** percent in interim 2007.120

The average number of production related workers declined by *** percent from 2005 to 2007

and was lower in interim 2008 than in interim 2007.121 Hours worked and wages paid decreased from

2005 to 2007, but were higher in interim 2008 than in interim 2007.122 Hourly wages increased from

2005 to 2007, and were higher in interim 2008 than in interim 2007.123 The domestic industry’s average

unit labor costs rose from 2005 to 2007, but were lower in interim 2008 than in interim 2007.124

Productivity declined from 2005 to 2007, but was higher in interim 2008 than in interim 2007.125

Due to the significant presence of aggressively priced subject imports, the domestic industry’s financial

indicators were *** despite rising prices and very strong demand throughout the period of investigation. 

The domestic industry’s net sales quantities declined by *** percent from 2005 to 2007.126 Net sales by

value decreased by *** percent from 2005 to 2006, and then increased by *** percent from 2006 to
 127 CR/PR at Table C-1. Net sales by value decreased from $*** to $*** in 2006, and then increased to $*** in

2007. Net sales by value were $*** in interim 2007 compared to $*** million in interim 2008. 

 128 The domestic industry reported *** in 2005, *** in 2006, and *** in 2007. The domestic industry reported

*** in interim 2007 and *** in interim 2008. CR/PR at Table C-1.

 129 CR/PR at Table C-1.

 130 CR/PR at Table C-1.

 131 Respondents testified that because SDGE is made to customer specifications, only a handful of customers may

be able to use SDGE of the same size or grade. Transcript at 207-208 (Brashem). 

 132 CR /PR at Tables V-1-V-5 and E-1-E-4.

 133 Nonsubject imports accounted for *** percent of the U.S. market in 2007, compared with *** percent for

subject imports and *** percent for the domestic industry. CR/PR at Table C-1.

 134 The three largest suppliers of nonsubject imports were Mexico, Japan, and Russia. From 2005 to 2007, the

volume of nonsubject imports from Mexico fluctuated but decreased overall; the volume of nonsubject imports from

Japan remained relatively steady; and the volume of nonsubject imports from Russia increased. CR/PR at Table

VII-7. Prices for nonsubject imports from these countries were generally above prices for subject imports during the

period of investigation. CR/PR at Tables V-1-V-5, VII-7, E-1-E-4. 

 135 CR/PR at Table C-1. We note that nonsubject imports declined in interim 2008 compared to interim 2007. In

both interim periods, however, nonsubject imports generally were priced higher than subject imports. CR/PR at

Tables V-1-V-5 and E-1-E-4. 

 136 CR/PR at Table C-1.

21

2007.127 The domestic industry’s operating income improved from *** in 2005 to *** in 2006, but

declined in 2007. In interim 2008, as net sales quantities increased ***, operating income was *** higher

compared to interim 2007.128 The domestic industry’s operating income margin increased from ***

percent in 2005 to *** percent in 2006, and then fell to *** percent in 2007. The domestic industry’s

operating income margin was higher at *** percent in interim 2008 compared to *** percent in interim

2007.129

In a market characterized by strong demand and rising prices, aggressive pricing by subject

imports caused the domestic industry to lose sales volume and market share. Deprived of the ability to

spread costs over additional sales volume, the industry’s profits, while not falling from 2005 to 2007,

were ***.130

We have also examined the role of nonsubject imports in the U.S. market during the period of

investigation. First, although SDGE from various sources are considered to be moderately or highly

interchangeable, SDGE is not a commodity product. Specifically, the interchangeability of SDGE is

limited by the fact that SDGE are produced to each customers’ specifications, which are derived from the

particular furnace or electrical equipment in which they are used.131 Secondly, nonsubject imports were

generally priced above subject imports, particularly later in the period of investigation.132 While

nonsubject imports were present in substantial quantities, nonsubject import volume and market share

tracked fluctuating trends in apparent U.S. consumption, in contrast to steady increases in subject imports

and declines in domestic producers’ U.S. shipments.133 134 Moreover, nonsubject imports’ market share

declined significantly in 2007 when the domestic industry’s condition worsened.135

Respondents note correctly that between 2005 and 2006, when U.S. producers’ U.S. shipments

experienced their largest annual drop in market share during the period of investigation, a majority of that

lost market share was initially assumed by non-subject imports. However, because subject imports

consistently undersold both domestic and non-subject imports, by the end of the period of investigation

subject imports had ultimately taken a greater portion of market share from the U.S. producers than that

taken by non-subject imports.136 Accordingly, we do not find that the injury to the domestic industry

described above can be attributed to the nonsubject imports.
 137 See, e.g., Timken Co. v. United States, 321 F. Supp. 2d at 13, n. 2 (Ct. Int’l Trade 2004) (“The purpose of the

antidumping statute . . . is to protect United States industries not specific corporations from unfair behavior by

foreign competitors.”); Calabria Corp. v. United States, 794 F. Supp. 377, 385-86 (Ct. Int’l Trade 1992) ( “This

Court has repeatedly affirmed . . . .that ‘Congress intended the ITC determine whether or not the domestic industry

(as a whole) has experienced material injury due to the imports. This language defies the suggestion that the ITC

must make a disaggregated analysis of material injury.’” quoting Copperweld Corp. v. United States, 682 F. Supp.

552, 569 (Ct. Int’l Trade 1988) (other citations omitted)). See also, Certain Aluminum Plate from South Africa, Inv.

No. 731-TA-1056 (Final), USITC Pub. 3734 (November 2004) at 21, n. 179 (declining to rely “on isolated data from

a given producer”).

 138 CR/PR at Tables VI-I and VI-2, CR at VI-6, PR at VI-2.

 139 Respondents’ Prehearing Brief at 41.

 140 CR/PR at Table VI-2. 

 141 CR/PR at Table C-1.

 142 CR/PR at Table C-1.

 143 CR/PR at Table C-1.

 144 Respondents’ Posthearing Brief at 7.

 145 CR/PR at Table C-1.

 146 CR/PR at Table C-1. 

22

Respondents maintain that any material injury suffered by the domestic industry was caused by

other factors and not by subject imports. They first contend that any material injury is due to *** during

the period of investigation. However, the statute requires the Commission to focus on the domestic

industry “as a whole” and data for the industry as a whole, described above, demonstrate the material

injury by reason of subject imports.137 Moreover, while ***. ***. By contrast, SGL, which ceased

production of 10- and 12- inch SDGE *** in order to be more insulated from competition from subject

imports, has concentrated production in the 14- and 16-inch diameter sizes. Because SGL’s manufacture

of SDGE was concentrated in those sizes, not only did it experience less direct competition with subject

imports, but it may have also benefitted from the fact that 14-inch and 16-inch diameter SDGE are higher

value products.138 Furthermore, both producers’ condition improved in the interim period 2008

(compared with interim 2007) as increases in subject imports into the U.S. market slowed and subject

imports’ prices increased after the petition was filed. Although Respondents attempt to tie ***,139 the

record indicates that ***.140 In addition, ***.

Respondents also argue that the domestic industry was not materially injured as its profitability

increased throughout the period of investigation. First, the effects of subject imports are not limited to an

industry’s profitability. The evidence shows that despite of rising overall demand, the domestic

industry’s U.S. shipments steadily declined from 2005 to 2007.141 Moreover, the record indicates that the

aggressively priced subject imports had a significant share of the market at the beginning of the period of

investigation when the domestic industry ***.142 While the domestic industry’s profitability improved

somewhat thereafter, its profitability was *** given very strong demand during the period as its U.S.

shipments declined due to increases in subject imports.143

Respondents contend that the decrease in domestic production during the period of investigation

is due to *** in the domestic industry’s export shipments.144 However, the record indicates that the

decline in production is largely attributable to the decline in the domestic industry’s U.S. shipments of

SDGE. Although the domestic industry did experience *** in export shipments, export shipments

represented a far smaller ratio to domestic production than U.S. shipments.145

Respondents also assert that domestic producers do not have the capacity to supply the entire U.S.

SDGE market.146 As the Commission previously has noted, “there is no short supply provision in the

statute” and “the fact that the domestic industry may not be able to supply all of demand does not mean
 147 Softwood Lumber from Canada, Inv. Nos. 701-TA-414 and 731-TA-928 (Article 1904 NAFTA Remand) at

108, n. 310 (December 2003). See also, Certain Activated Carbon from China, Inv. No. 731-TA-1103 (Preliminary),

USITC Pub. 3852 (May 2006) at 19, n. 134; Certain Orange Juice from Brazil, Inv. No. 731-TA-1089 (Final),

USITC Pub. 3838 (March 2006) at 20 n. 143; Certain Lined Paper School Supplies, Inv. Nos. 701-TA-442-443

(Preliminary) and 731-TA-1095-1097 (Preliminary), USITC Pub. 3811 (October 2005) at 23, n. 155; Metal Calendar

Slides from Japan, Inv. No. 731-TA-1094 (Preliminary), USITC Pub. 3792 (August 2005) at 9, n. 45 (“To the extent

that Respondents claim that the Commission is legally unable to make an affirmative finding of material injury by

reason of subject imports because the domestic industry is incapable of supplying domestic demand, they are

incorrect.”).

 148 CR/PR at Tables III-2, IV-3, and C-1.

 149 CR/PR at Table C-1.

 150 See Separate and Concurring Views of Commissioner Charlotte R. Lane, discussing the high level of U.S.

importers’ inventories as it pertains to the issue of critical circumstances.

 151 Final Determination, 72 Fed. Reg. at 19692.

 152 19 U.S.C. § 1673d(b)(4)(A)(i).

 153 SAA at 877.

23

the industry may not be materially injured or threatened with material injury by reason of subject

imports.”147 While domestic producers’ existing production is less than apparent U.S. consumption,

domestic producers had *** unused capacity during 2005 to 2007, despite very high demand.148 Indeed,

the domestic producers’ capacity utilization decreased from *** percent in 2005 to *** percent in 2006

and to *** percent in 2007 and was *** percent in interim 2008 compared to *** percent in interim

2007.149

 We conclude that subject imports had a significant adverse impact on the condition of the

domestic industry during the period of investigation. As discussed above, the absolute and relative

volume of subject imports are significant. Subject imports gained market share at the expense of the

domestic industry and caused domestic U.S. shipments to dwindle as subject imports aggressively

undersold the domestic product. The pattern of underselling resulted in significant lost sales and

suppressed domestic prices to some extent in 2007. The increase in subject imports and their adverse

effects on U.S. prices materially impacted the domestic industry’s profitability and market share over the

period of investigation.

IV. CRITICAL CIRCUMSTANCES150

In its final antidumping duty determinations concerning SDGE from China, Commerce found that

critical circumstances exist with respect to a number of subject producers/exporters.151 Because we have

determined that the domestic industry is materially injured by reason of subject imports from China, we

must further determine “whether the imports subject to the affirmative [Commerce critical circumstances]

determination . . . are likely to undermine seriously the remedial effect of the antidumping order to be

issued.”152 The Statement of Administrative Action (“SAA”) indicates that the Commission is to

determine “whether, by massively increasing imports prior to the effective date of relief, the importers

have seriously undermined the remedial effect of the order.”153

The statute further provides that in making this determination the Commission shall consider,

among other factors it considers relevant – 

(I) the timing and the volume of the imports,

(II) a rapid increase in inventories of the imports, and
 154 19 U.S.C. § 1673d(b)(4)(A)(ii).

 155 The legislative history for the critical circumstances provision indicates that the provision was designed “to

deter exporters whose merchandise is subject to an investigation from circumventing the intent of the law by

increasing their exports to the United States during the period between initiation of an investigation and a

preliminary determination by [Commerce].” ICC Industries, Inc. v. United States, 812 F.2s 694, 700 (Fed. Cir.

1987), quoting H.R. Rep. No. 317, 96th Cong., 1st Sess. 63 (1979).

 156 See Certain Lined School Paper Supplies from China, India, and Indonesia, USITC Pub. 3884 at 47; Carbozole

Violet Pigment from China and India, Inv. Nos. 701-TA-437 and 731-TA-1060 and 1061 (Final), USITC Pub. 3744

(December 2004) at 26; Certain Frozen Fish Fillets from Vietnam, Inv. No. 731-TA-1012 (Final), USITC Pub. 3617

(August 2003) at 20-22.

 157 Petitioners’ Posthearing Brief Ex. 1 at 54.

 158 Compare Certain Brake Drums and Rotors from China, Inv. No. 731-TA-744 (Final), USITC Pub. 3035 (April

1997) at 19 n.109 with Steel Concrete Reinforcing Bars from Turkey, Inv. Nos. 731-TA-745 (Final), USITC Pub.

3034 (April 1997) at 34.

 159 We note that Petitioners also advocated that we should use official import statistics in making our critical

circumstances determination. As the Petitioners themselves indicated, those statistics include nonsubject

merchandise. In any event, both official import statistics and the import data collected by the Commission show

similar trends. Petitioners’ Posthearing Brief Ex. 1 at 54. 

 160 CR/PR at IV-5. 

 161 CR/PR at Table C-1.

24

(III) any other circumstances indicating that the remedial effect of the antidumping order

will be seriously undermined.154

In considering the timing and volume of subject imports, the Commission’s practice is to consider

import quantities prior to the filing of the petition with those subsequent to the filing of the petition155

using monthly statistics on the record regarding those firms for which Commerce has made an affirmative

critical circumstance determination.156

Petitioners urge the Commission to make an affirmative critical circumstances finding. They

argue that the Commission should predicate its critical circumstances determination on import trends for

the five-month pre-petition period of September 2007 through January 2008 and a post-petition period of

February through June 2008. Petitioners contend that January 2008 should be considered part of the prepetition period as the petition was filed late in January 2008.157

We are not persuaded by Petitioners’ argument that we should diverge from our normal practice 

of relying on data gathered for the six-month periods immediately preceding and following the filing of

the petition.158 159 Based on a comparison of subject import volume over the six-month periods before and

after the petition’s filing in January 2008, we find no massive increase in imports prior to the effective

date of relief that could seriously undermine the remedial effect of the order. Based on importer

questionnaires, subject imports increased by only *** percent between the July-December 2007 and

January-June 2008 periods, from *** metric tons to *** metric tons.160 Thus, the record reflects no

massive increase in subject import volume subsequent to the petition’s filing. 

Inventory data confirms the lack of any massive increase in subject imports that could seriously

undermine the remedial effect of the order. Indeed, the record shows that importers’ end-of-period

inventories in interim 2008 of subject merchandise from China were actually less than end-of-the period

inventories in interim 2007, which contravenes any allegation that U.S. importers were stockpiling SDGE

from China after the filing of the petition in January 2008.161

We determine that critical circumstances do not exist with respect to the subject imports from

China covered by Commerce’s affirmative critical circumstances determination, and we therefore make a

negative critical circumstances determination.
25

CONCLUSION

For the foregoing reasons, we determine that the domestic industry producing SDGE is materially

injured by reason of subject imports from China sold at less than fair value.
 
 1

 19 U.S.C. § 1673d(b)(4)(A)(ii).

 2

 See CR/PR at IV-5.

 3

 See CR/PR at Table VII-4.

 4

 CR/PR at Table VII-4.

 5

 CR/PR at Table IV-3.

 6

 CR/PR at Table VII-4.

 7

 CR/PR at Table III-6.

27

SEPARATE AND CONCURRING VIEWS OF 

COMMISSIONER CHARLOTTE R. LANE

Based on the record in these final phase investigations, I find that an industry in the United States

is materially injured by reason of imports of small diameter graphite electrodes (“SDGE”) from China

that are sold in the United States at less than fair value. I also determine that critical circumstances do not

exist with respect to the subject imports from China covered by the Department of Commerce’s

affirmative critical circumstances determination. Following are my additional views regarding the issue

of critical circumstances, specifically as pertains to the large number of subject importers’ inventories in

this investigation.

Under the statute, when evaluating critical circumstances the Commission shall consider, among

other factors it considers relevant, the timing and the volume of the imports, a rapid increase in

inventories of the imports, and any other circumstances indicating that the remedial effect of the

antidumping order will be seriously undermined.1

 I agree with my colleagues that, based on the

Commission’s traditional evaluation of the volumes of subject imports during the six-month period prior

to the filing of a petition and the six-month period following the filing of a petition, there does not appear

to be an unusual increase in subject imports after the petition in this investigation was filed in January

2008.2

 Moreover, it is not clear how rapidly inventories of subject imports have increased, as most of the

inventory data in the record represent a snapshot in time at the end of each year of the period of

investigation and the remaining inventory data do not correspond to the six-month periods described

above.3

 However, I am concerned that an unusually high level of subject imports, regardless of the timing

of the buildup of such inventories, could be a significant “other circumstance” that the Commission

should more carefully consider in determining if the effect of an antidumping order will be seriously

undermined. If volumes of subject imports held in inventory are unusually high, domestic shipments of

subject imports that are not subject to an order could continue for an extended period of time and

undermine the effectiveness of an order.

In this case, it appears that the volume of subject importers’ inventories is unusually high. These

inventories, as reported to the Commission as of the end of 2007, totaled *** metric tons.4

 This is an

exceptionally large number relative to the *** metric tons of U.S. shipments of subject imports in 2007

and represents an inventory equal to *** percent, or nearly *** of U.S. shipments.5

 By comparison, nonsubject import inventory levels totaled only *** metric tons in 2007, or approximately *** percent of

non-subject annual U.S. shipments.6

 Domestic producers’ inventory levels in 2007 were only *** metric

tons, or approximately *** percent of annual U.S. shipments.7

Moreover, the reported inventories of subject imports appear to be seriously understated, even

before taking into consideration the limited number of responses to the Commission’s importer
 8

 Importer questionnaires were sent to 32 firms believed to be subject importers. The Commission received

usable questionnaire responses from 12 companies, representing 58.3 percent of total imports from China during the

period of investigation under HTS subheading 8545.11.00, a “basket” category. CR/PR at IV-1.

 9

 See *** Importer Questionnaire Response.

 10 See CR/PR at Tables IV-2, IV-3.

 11 See CR/PR at Table VII-4.

28

questionnaire.8

 One *** importer who responded to the questionnaire did not provide inventory

numbers.9

 This may account for the discrepancy between reported imports, reported domestic shipments

of imports and reported inventory levels. The reported volume of subject imports in 2006 and 2007 was

*** metric tons and the reported shipments of subject imports during 2006 and 2007 totaled only ***

metric tons.10 Thus, there were *** metric tons of subject SDGE imported in excess of shipments in 2006

and 2007. Even assuming that the *** metric ton inventory level reported for 2005 was correct (which

would mean that the importer that did not provide inventory data had a zero inventory in 2005),11 the data

indicate that total inventories of subject SDGE for those importers responding to the questionnaire are

likely to be in excess of *** metric tons as of the end of 2007. This would represent over *** percent of

reported U.S. shipments of subject imports in 2007, or more than *** months worth of U.S. shipments. 

And it is also important to note that all of the import data are likely understated because, as stated above,

the import coverage in the questionnaire responses is estimated to be only approximately 58 percent of

total subject imports.

As noted above, the Commission is not limited by the statute to finding that a rapid increase in

subject imports or inventories of the imports immediately after the filing of a petition may undermine an

antidumping order. There may be “other circumstances” that would also undermine an order. I believe

that the level of inventories of subject imports is an important piece of information and one of the “other

circumstances” that might indicate that an antidumping duty order will be undermined. I believe that it is

a very close call in this case whether the unusually high inventory levels support a finding that the

remedial effects of an order will be seriously undermined. The domestic industry did not argue that the

high inventory levels were an undermining factor and there is no evidence of rapid increases in volumes

of subject imports. Therefore, even though I find that the high levels of subject imports alone represent a

factor that could undermine the effectiveness of the order, I do not find sufficient evidence that this factor

alone justifies an affirmative finding with regard to critical circumstances.
 1

 A complete description of the imported products subject to this investigation is presented in The Subject

Merchandise section of this part of the report. 

 2 Federal Register notices since August 2008 cited in the tabulation are presented in app. A.

I-1

PART I: INTRODUCTION

BACKGROUND

This investigation results from a petition filed with the U.S. Department of Commerce

(“Commerce”) and the U.S. International Trade Commission (“USITC” or “Commission”) by SGL

Carbon LLC, Charlotte, NC and Superior Graphite Co., Chicago, IL on January 17, 2008, alleging that an

industry in the United States is materially injured and threatened with material injury by reason of lessthan-fair-value (“LTFV”) imports of small diameter graphite electrodes (“SDGE”)1

 from China. 

Information relating to the background of the investigation is provided below.2

Effective date Action

January 17, 2008 Petition filed with Commerce and the Commission; institution of the

Commission’s investigation (73 FR 4627, January 25, 2008)

February 13, 2008 Commerce’s notice of initiation (73 FR 8287)

March 3, 2008 Commission’s preliminary determination (73 FR 12461), March 7, 2008

August 21, 2008

Commerce’s preliminary determination (73 FR 49408, August 21, 2008,

amended by 73 FR 54561, September 22, 2008); scheduling of final phase of

the Commission’s investigation (73 FR 51647, September 4, 2008)

January 14, 2009 Commerce’s final determination (74 FR 2049, January 14, 2009)

January 6, 2009 Commission’s hearing1

February 5, 2009 Commission’s vote

February 19, 2009 Commission’s determination sent to Commerce

 1 App. B presents a list of witnesses that appeared at the hearing.

STATUTORY CRITERIA AND ORGANIZATION OF THE REPORT

Statutory Criteria

Section 771(7)(B) of the Tariff Act of 1930 (the “Act”) (19 U.S.C. § 1677(7)(B)) provides that in

making its determinations of injury to an industry in the United States, the Commission--

shall consider (I) the volume of imports of the subject merchandise, (II)

the effect of imports of that merchandise on prices in the United States

for domestic like products, and (III) the impact of imports of such 

merchandise on domestic producers of domestic like products, but only

in the context of production operations within the United States; and . . .

may consider such other economic factors as are relevant to the

determination regarding whether there is material injury by reason of

imports.
I-2

Section 771(7)(C) of the Act (19 U.S.C. § 1677(7)(C)) further provides that--

In evaluating the volume of imports of merchandise, the Commission

shall consider whether the volume of imports of the merchandise, or any

increase in that volume, either in absolute terms or relative to production

or consumption in the United States is significant.

. . .

In evaluating the effect of imports of such merchandise on prices, the

Commission shall consider whether . . . (I) there has been significant

price underselling by the imported merchandise as compared with the

price of domestic like products of the United States, and (II) the effect of

imports of such merchandise otherwise depresses prices to a significant

degree or prevents price increases, which otherwise would have

occurred, to a significant degree.

. . .

In examining the impact required to be considered under subparagraph

(B)(i)(III), the Commission shall evaluate (within the context of the

business cycle and conditions of competition that are distinctive to the

affected industry) all relevant economic factors which have a bearing on

the state of the industry in the United States, including, but not limited to

. . . 

(I) actual and potential declines in output, sales, market share, profits,

productivity, return on investments, and utilization of capacity, (II)

factors affecting domestic prices, (III) actual and potential negative

effects on cash flow, inventories, employment, wages, growth, ability to

raise capital, and investment, (IV) actual and potential negative effects

on the existing development and production efforts of the domestic

industry, including efforts to develop a derivative or more advanced

version of the domestic like product, and (V) in {an antidumping

investigation}, the magnitude of the margin of dumping.

Organization of the Report

Part I of this report presents information on the subject merchandise, dumping margins, and

domestic like product. Part II of this report presents information on conditions of competition and other

relevant economic factors. Part III presents information on the condition of the U.S. industry, including

data on capacity, production, shipments, inventories, and employment. Parts IV and V present the

volume and pricing of imports of the subject merchandise, respectively. Part VI presents information on

the financial experience of U.S. producers. Part VII presents the statutory requirements and information

obtained for use in the Commission’s consideration of the question of threat of material injury and the

judicial requirements and information obtained for use in the Commission’s consideration of Bratsk

issues.
 3

 In the United States, during the period of investigation, SGL Carbon produced 14-inch and 16-inch SDGE and

18-inch through 32-inch LDGE, and Superior Graphite produced 8-inch to 16-inch diameter SDGE. Conference

transcript, pp. 45 (Stinson), and 49-50 (Carney).

 4

 Respondents M. Brashem and Graphite Electrode Sales both noted that they imported 3-inch through 24-inch

graphite electrodes. Conference transcript, pp. 108 (Buchanan) and 122 (Kearney).

 5

 U.S. importer GrafTech International Holdings Inc. accounted for *** of U.S. imports from Mexico reported in

official Commerce statistics. The U.S. imports of SDGE from Mexico are ***. Imports from Mexico account for

*** of nonsubject imports for each year during the period of investigation.

I-3

U.S. MARKET SUMMARY

The U.S. market for SDGE totaled approximately *** metric tons and $*** in 2007. Currently

two companies produce SDGE in the United States: SGL Carbon LLC and Superior Graphite Co., which

accounted for all U.S. production of SDGE in 2007.3

 Eight firms reported having imported SDGE from

China since 2005, and four firms reported having imported from all other sources. Graphite Electrode

Sales and M. Brashem accounted for *** percent and *** percent of reported imports of SDGE from

China in 2007, respectively.4

 The petition identified 102 firms as producers or exporters of SDGE in

China. 

U.S. producers’ U.S. shipments of SDGE totaled *** metric tons valued at $*** in 2007, and

accounted for *** percent of apparent U.S. consumption by quantity and *** percent by value. U.S.

shipments of imports from China totaled *** metric tons, and accounted for *** percent of apparent U.S.

consumption by quantity and *** percent by value. U.S. shipments of imports for all other sources

totaled *** metric tons, and accounted for *** percent of apparent U.S. consumption by quantity and

*** percent by value. 

SDGE is generally used by foundries, smelters, steel refining operations, and other industries in

primary melting, ladle metallurgy, and specialty furnace applications.

SUMMARY DATA

A summary of data collected on SDGE is presented in appendix C, table C-1. Except as noted,

U.S. industry data are based on questionnaire responses of two firms that accounted for 100 percent of

U.S. production of SDGE during 2007. Data on U.S. imports from China presented in this report are

based on questionnaire responses, as official statistics are from a “basket” classification that is broader

than the subject product. Data on U.S. imports from Mexico presented in this report are based on

information provided by GrafTech Mexico S.A. de C.V., the sole known producer of SDGE in Mexico.5

Data on U.S. imports from sources other than China and Mexico are based on the estimates of official

Commerce statistics as provided in the petition.

The Commission sent producers’ questionnaires to four firms believed to be possible producers of

large diameter graphite electrodes (“LDGE”) in the United States: C/G Electrodes LLC; GrafTech 

International, Ltd.; Showa Denko Carbon, Inc.; and a petitioner, SGL Carbon. SGL Carbon is currently

the only U.S. producer that manufactures both LDGE and SDGE. A summary of data collected on LDGE

is presented in appendix C, table C-2, and a summary of data collected on SDGE and LDGE combined is

presented in appendix C, table C-3.
 6 Final Determination of Sales at Less Than Fair Value and Affirmative Determination of Critical

Circumstances: Small Diameter Graphite Electrodes from the People’s Republic of China, 74 FR 2049, January 14,

2009.

 7

 Ibid.

I-4

PREVIOUS AND RELATED INVESTIGATIONS

SDGE has not been the subject of any prior antidumping or countervailing duty investigations in

the United States.

NATURE AND EXTENT OF SALES AT LTFV

Commerce has determined dumping margins of between 132.90 percent and 159.64 percent for

SDGE from China.6

THE SUBJECT MERCHANDISE

Commerce’s Scope

Commerce has defined the scope of this investigation as follows:

The merchandise covered by this investigation includes all small diameter graphite

electrodes of any length, whether or not finished, of a kind used in furnaces, with a

nominal or actual diameter of 400 millimeters (16 inches) or less, and whether or not

attached to a graphite pin joining system or any other type of joining system or hardware. 

The merchandise covered by this investigation also includes graphite pin joining systems

for small diameter graphite electrodes, of any length, whether or not finished, of a kind

used in furnaces, and whether or not the graphite pin joining system is attached to, sold

with, or sold separately from, the small diameter graphite electrode. Small diameter

graphite electrodes and graphite pin joining systems for small diameter graphite

electrodes are most commonly used in primary melting, ladle metallurgy, and specialty

furnace applications in industries including foundries, smelters, and steel refining

operations. Small diameter graphite electrodes and graphite pin joining systems for small

diameter graphite electrodes that are subject to this investigation are currently classified

under the Harmonized Tariff Schedule of the United States (HTSUS) subheading

8545.11.0000. The HTSUS number is provided for convenience and customs purposes,

but the written description of the scope is dispositive.7

Tariff Treatment

Imports of SDGE are classifiable in the HTSUS under subheading 8545.11.00 (carbon or graphite

electrodes of a kind used for furnaces) and are free of duty under the general duty rate, applicable to

China. This subheading contains other products besides SDGE (all carbon or graphite electrodes of a

kind used in furnaces). Table I-1 presents current tariff rates for SDGE.
 8

 Petition, p. 73.

 9

 Respondents’ postconference brief, p. 1. Respondents consist of 5 U.S. importers of SDGE from China, and

8 producers and/or exporters of SDGE from China.

 10 Small Diameter Graphite Electrodes From China, Investigation No. 731-1143 (Preliminary), USITC

Publication 3985, March 2008, p. 9.

I-5

Table I-1

SDGE: Tariff rates, 2009

HTS provision Article description

General1 Special2 Column 23

Rates (percent ad valorem)

8545

8545.11.00

Carbon electrodes, carbon brushes,

lamp carbons, battery carbons and other

articles of graphite or other carbon, with

or without metal, of any kind used for

electrical purposes:

Electrodes:

Of a kind used for furnaces. . . . Free 45.0

1

 Normal trade relations, formerly known as the most-favored-nation duty rate, applicable to imports from China. 2

 Special rates not applicable when General rate is free. China is ineligible for special duty rate treatment. 3

 Applies to imports from a small number of countries that do not enjoy normal trade relations duty status.

Source: Harmonized Tariff Schedule of the United States (2009).

DOMESTIC LIKE PRODUCT

The Commission’s decision regarding the appropriate domestic products that are "like" the

subject imported products is based on a number of factors including: (1) physical characteristics and

uses; (2) common manufacturing facilities and production employees; (3) interchangeability; (4) customer

and producer perceptions; (5) channels of distribution; and (6) price. Information regarding

interchangeability, customer and producer perceptions, and channels of distribution is presented in Part II

of this report. Information regarding price is presented later in Part I and also in Part V of this report. 

Information regarding the physical characteristics and uses and the manufacturing process of graphite

electrodes is presented below.

Petitioners contend that the Commission should find one domestic like product that is coextensive

with the scope of merchandise subject to the investigation as identified by the petition. Moreover,

petitioners assert that SDGE form a single domestic like product that is exclusive of other electrodes, in

particular LDGE.8

 Respondents argue that there is no “bright line” between graphite electrodes at the

16-inch diameter point, and that all graphite electrodes constitute a single domestic like product with a

continuum of diameter sizes.9

 In the preliminary phase of this investigation, the Commission found that:

“there are both differences and similarities between SDGE and LDGE

with respect to each of the six factors. Based on the current record, while

it is a close question, we define the domestic like product to be SDGE. 

In any final phase investigation, we intend to collect additional

information, particularly from purchasers concerning their perceptions of

the products, and to revisit the issue of whether SDGE and LDGE should

be characterized as a continuum of products without a clear dividing

line.”10
 11 Superior currently sells *** and SGL uses a ***. Petitioners’ posthearing brief, p. 3.

 12 Respondents reported that the primary steel segment uses electrodes ranging from 14 inches to 28 inches in

diameter. The ladle segment uses 10-inch through 20-inch electrodes. The foundry segment uses 3-inch through

24-inch electrodes, and other categories use electrodes ranging from 8 inches to 24 inches for a wide variety of

applications, such as refining slag, making abrasives, fusing silica, and producing iron, and titanium. Conference

transcript, p. 112 (Buchanan).

 13 An ampere is a unit of electric current in the meter-kilogram-second system. Amperes are used to measure

electric current.

 14 Petition, p. 5.

 15 Staff telephone interview with ***. Conference transcript, p. 13 (Stinson).

I-6

In the final phase of the investigation, the Commission asked U.S. producers, importers, purchasers, and

foreign producers to describe the differences and similarities between SDGE and LDGE; the data

collected are presented in appendix D.

Physical Characteristics and Uses

SDGE, cylindrical in shape, are produced from various grades of petroleum coke,11 and are used

primarily in ladle metallurgy, primarily low-duty melting, and specialty furnace applications, such as the

electric arc furnace (“EAF”) shown in figure I-1. SDGE are used in steel-making "mini-mills" to generate

the heat necessary to melt and further refine steel.12 SDGE act as conductors of electricity in EAFs,

generating sufficient heat to melt scrap metal, iron ore, or other raw materials used to produce steel or

other metals. Heat is generated as electricity at very high amperes13 passes though the SDGE and creates

an electric arc between the electrodes and the raw material.14 Typically, electrodes are joined in columns

by a threaded connecting system, most commonly a graphite connecting pin which is a short graphite

piece that is threaded at both ends and used to join two electrodes.15 The pin joining system is the most
 16 Ibid.

 17 Ibid.

 18 Ibid.

 19 Ibid.

 20 ***, plant visit by Commission staff, January 28, 2008.

 21 Other uses include smelters, fused metal oxide production, waste recovery, waste encapsulation, and other

minor furnace applications (petitioners’ February 15, 2008 submission on the uses of graphite electrodes by diameter

size). Respondents reported that the primary steel segment uses electrodes ranging from 14 inches to 28 inches in

diameter. The ladle segment uses 10-inch through 20-inch electrodes and the foundry segment uses 3-inch through

24-inch electrodes. Conference transcript, p. 112 (Buchanan).

 22 Hearing transcript, p. 79 (McClintock).

 23 Petitioners’ postconference brief, p. 7. Respondents agree with this characteristic of general uses of LDGE and

SDGE, but argue that there is considerable overlap of sizes of electrodes by different segments of the domestic

industry consuming electrodes. Respondents’ postconference brief, p. 10.

 24 Hearing transcript, p. 17 (Stinson).

 25 Petitioners note that an electrode is designed to fit a particular application. Conference transcript, p. 57

(Anderson).

 26 *** importer’s questionnaire at I-10.

 27 Conference transcript, p. 49 (Stinson). Petitioners acknowledge that this is true amongst sizes both in and

between SDGE and LDGE. Conference transcript, pp. 63-65.

I-7

expensive and strongest part of the electrode.16 Alternating current electric arc furnaces generally use

three columns of electrodes and direct current furnaces use one column.17 Graphite connecting pins are

tapered and threaded on each end and screw two or more electrodes together.18 The electrodes are fed

through holes in the top of the EAFs and held in place by electrical current carrying holders and arms

designed for the specific size of electrode to be used.19 ***.20 Because of the intensity of the melting

process, the electrodes are continuously consumed during the course of the production of metal.

SDGE are primarily used in steel refining, but are also used in foundry applications, steel

melting, and other uses.21 Foundries are the primary users of electrodes that are 8 inches and under.22

LDGE are primarily used in high to ultra-high power (“UHP”) melting applications, namely large EAFs

for steel melting, and the small remainder of LDGE, only about 5 percent, is used in secondary ladle and

refining operations to support the largest size melting operations.23 Modern steel mills typically have

EAFs that use electrodes that are at least 24 inches in diameter.24

The design of the equipment that uses the electrodes determines the optimum electrode diameter,

based on electrical and operating specifications.25 Once a furnace, transformer, and electrical system is

designed and built, an optimum electrode diameter becomes fixed on the electrical and operating

specifications. At this point, it becomes unfeasible and unsafe to interchange different electrode

diameters. In addition, electrode holders are designed for a specific electrode diameter and would need to

be changed to hold a larger or smaller electrode. It is not possible to interchange between electrodes of

different diameters without first making significant equipment changes.26

According to the petitioners, it is cost-prohibitive to convert the equipment, such as the holders in

EAFs, to accept a different size.27 Depending on the application and its requirements, an electrode

designed for those uses will have certain physical characteristics, such as resistance, current carrying

capacity, and strength. Given the different typical uses of SDGE and LDGE and their different

requirements, petitioners contend that SDGE have physical characteristics that distinguish them from
 28 Petition, p. 70. Respondents argue that while electrodes may have different characteristics, essential

characteristics are shared by all electrodes, and there is overlap of certain characteristics between two adjacent sizes. 

Respondents’ postconference brief, pp. 7-9.

 29 Petition, p. 3, and petitioners’ postconference brief, p. 8. SGL noted that it uses premium needle coke in some

of its SDGE, depending on its customers’ requirements. Conference transcript, p. 53 (Stinson).

 30 These grades are not governed by a particular organization, and are more of a marketing technique. Conference

transcript, pp. 55-56 (Stinson). The uses of these grades are generally accepted in the market as points of

differentiation between electrodes.

 31 Petitioners’ postconference brief, p. 9, and conference transcript, p. 130 (Brashem).

 32 *** importer’s questionnaire at II-5a.

 33 Conference transcript, p. 17 (Stinson).

 34 Conference transcript, p. 16 (Stinson) and hearing transcript, p. 17 (Stinson).

 35 Conference transcript, pp. 109-110 (Buchanan).

 36 Petitioners’ postconference brief, exh. 23 and conference transcript, p. 140 (Buchanan).

 37 Bulk density is a measurement of weight per unit volume. A higher bulk density will generally be reflected in

improved mechanical properties. Specific electric resistance is the electrical resistance of a unit length of graphite. 

One of graphite’s useful properties is that electrical resistance does not increase strongly with temperature. Up to

1400°C, the electrical resistance is lower than it was at room temperature. The coefficient of thermal expansion

(“CTE”) is a measurement of the increase in length per unit length per degree rise in temperature. Lower CTE will

give better resistance to thermal shock. Also, CTE compatibility between the graphite electrode and the connecting

pin is important for satisfactory performance of the electrode joint. The flexural strength is the maximum stress

which the material will withstand before rupture in bending. Higher flexural strength in electrodes will generally

result in lower electrode breakage frequency. Petitioners’ postconference brief, exh. 8; staff telephone interview

with ***; and staff telephone interview with ***.

I-8

other graphite electrodes (such as LDGE)28 and that these physical characteristics make SDGE more

applicable to the aforementioned uses.

SDGE are typically fabricated from a range of different grades of petroleum coke, from low grade

anode coke to premium high grade needle coke (also known as acicular coke) or a blend of the two. 

Anode coke is used in low intensity applications using SDGE that are typically used in refining

operations (ladle) and medium- to low-duty melting applications (foundries) whereas LDGE generally use

100-percent premium high grade needle coke and are typically used in high to ultra-high power (melting)

applications.29 As a result of the different raw materials used, SDGE and LDGE are produced in a variety

of grades, including regular power (“RP”), normal power (“NP”), medium power (“MP”), high power

(“HP”), super high power (“SHP”), and ultra high power (“UHP”).30 SDGE are generally produced in all

grades, while LDGE are typically produced in the HP, SHP, and mostly UHP grades.31 ***.32

The grade of coke, along with other characteristics such as size, determines the amount of current

an electrode can carry. SDGE typically have lower current carrying capacity ranging from 15,000 to

60,000 amps, but do not exceed 70,000 amps.33 LDGE can carry from 60,000 to 160,000 amps, with the

majority of modern EAFs operating over 100,000 amps.34 Respondents note that there is an overlap in

current carrying capacity among adjacent sized electrodes but no overlap among electrodes of more

diverse size.35 A typical consumption rate for SDGE in ladle furnace and foundry uses typically ranges

from 0.2 to 1.5 pounds of electrodes per ton of steel processed. In contrast, the LDGE ratio of

consumption in large steel mill EAFs can range from 1.5 to 12 pounds of electrodes per ton of steel

processed.36 Characteristics of electrodes include bulk density, specific electrical resistance, coefficient of

thermal expansion, and flexural strength.37 Typical characteristics and ranges for SDGE and LDGE are

presented in table I-2.
 38 The following discussion is generally from the petition, pp. 4-5, and “Electric Arc Furnace Steel Making,

Electrodes,” American Iron and Steel Institute, found at

http://www.steel.org/AM/Template.cfm?Section=Home&template=/CM/HTMLDisplay.cfm&ContentID=21169#tur

n, retrieved on January 31, 2008.

 39 Petitioners note that SDGE and LDGE use different presses in the extrusion process. Conference transcript, pp.

62-63.

I-9

Table I-2

Electrodes: Typical physical characteristics

Characteristic SDGE LDGE

Bulk density (g/cm3

) 1.57 - 1.77 1.67 - 1.77

Specific electrical resistance (μΩm) 5.5 - 8.9 4.0 - 5.5

Coefficient of thermal expansion (μm/Kqm) 0.4 - 1.4 0.3 - 0.6

Flexural strength (psi) 1,000 - 2,400 1,100 - 1,900

Note: This table represents typical characteristics. These characteristics may vary by producer and grade of

electrode. The importance of these characteristics depends on the application of the electrode.

Source: Petitioners’ postconference brief, exh. 2, 4, 5, and 6

Manufacturing Facilities and Production Processes

Graphite electrodes are cylindrical in shape, and are manufactured through a series of processes.38

The six basic stages of production include forming (also known as extruding), baking, pitch impregnation

(for some models), graphitization, finishing, and packaging. Figure I-2 presents a flow diagram of the

graphite electrode production process. The production of graphite electrodes begins with petroleum coke

being crushed and graded to size by screening to achieve desired formulation. Utilizing different-sized

coke particles in predetermined ratios, the mix is blended with coal or petroleum tar pitch which forms the

bond between the separate particles. The blending is done at a high temperature to make the tar pitch

fully plastic. 

The mix is then charged into a ram type hydraulic press from which a cylindrical column is

extruded and cooled.39 This basic form cylindrical column, known as a “green electrode,” then enters an

oven to undergo a baking process. The heating process follows a predetermined and gradually increasing

heating curve, reaching a final temperature of approximately 900 degrees centigrade. During this stage,

the petroleum pitch is converted into hard coke, and impurities are removed. After the baking process,

the electrode form may be impregnated with a special pitch and rebaked, filling pores to increase its

density and strength, and lowering the electrical resistivity. LDGE are always impregnated at least once

while SDGE are not always impregnated. The electrode form then undergoes the graphitization process

by which baked coke is transformed into graphite. The electrodes are packed in electric furnaces

surrounded by carbon particles to form a solid mass. An electric current is passed through the furnace,

raising the temperature to as much as 3,000 degrees centigrade (approximately 5,400 degrees Fahrenheit). 

This process is usually achieved using either an Acheson type furnace or an in-line graphitization furnace

(also known as a lengthwise graphitization (“LWG”) furnace). With the Acheson type furnace, electrodes

are graphitized using a batch process, while in a LWG furnace the entire column is graphitized at the

same time. Unfinished SDGE undergo no further processing beyond the graphitization stage other than

machining. For larger size electrodes, LWG furnaces produce a higher quality graphite electrode at a

lower cost when compared to the Acheson process. The LWG furnace requires shorter heating periods,
 40 “Graphite production and further processing,” found at

www.carbonandgraphite.org/pdf/graphite_production.pdf, retrieved on January 30, 2008. 

 41 Petitioners note that heating periods for LWG furnaces can range from 10 to 20 hours, while Acheson furnaces

can take many days. Conference transcript, p. 54 (Stinson).

 42 Conference transcript, p. 39 (Luberda). Hearing transcript, p. 19 (Stinson).

 43 Staff telephone interview with ***.

 44 ***, email message to Commission staff, January 7, 2009.

I-10

less power consumption, less labor, and a smaller furnace.40 Acheson furnaces have larger payloads, but

can take significantly longer to graphitize.41 SGL Carbon uses ***, Superior Graphite uses ***, and

nearly all the Chinese production of SDGE makes use of older Acheson furnace technology.

Figure I-2

Graphite electrode production process

Source: Sichuan GMT International, Inc., found at http://www.scgmt.com/graphite%20electrode/index.html, retrieved

on January 31, 2008.

The graphite electrodes, after cooling, may then go to a final stage to be machined to exact

dimensions and tolerances. This stage may also include machining and fitting the ends of the electrode

with a threaded graphite pin joining system (also known as a pinning or connecting system). Due to the

mechanical stresses in melting scrap steel, connecting pins must be very strong and are impregnated and

rebaked multiple times. In contrast, connecting pins for small diameter products are not required to be as

strong because the low energy applications in which they are used, such as refining furnaces, ladle

furnaces, and foundries, generally do not place as much physical stress on the product.42 The electrode

size and prevailing industrial standards dictate the diameter size and threading of the connecting pin.43

***.44 The finished product is then packaged for shipment, typically placed between wooden chocks, and
 45 Petition, p. 73 and hearing transcript, p. 20 (Stinson).

 46 ***. *** importer’s questionnaire, II-5a.

 47 Petition, p. 72, conference transcript, p. 63, and hearing transcript, p. 20 (Stinson). Petitioners note that the

stainless steel cans used in the baking process and much of the handling equipment are designed for a certain

diameter size of electrode. ***.

 48 Petition, pp. 72-73 and hearing transcript, p. 20 (Stinson). Superior Graphite notes that impregnation is the

only process in its current process flow sheet which could be used to produce LDGE. Conference transcript, p. 47.

 49 *** producer’s questionnaire, II-3b.

 50 Email message to Commission staff by ***, January 8, 2009; information from importers (see email from ***

to ***), August 1, 2008; and petitioners’ prehearing brief, p. 4, fn. 2.

 51 Trends in AUVs may reflect shifts in product mix.

I-11

packed in wooden crates for protection during shipping. SDGE may also be bundled in steel strips before

packing.

There is some overlap in manufacturing facilities between SDGE and LDGE.45 46 SGL Carbon,

the only producer of both SDGE and LDGE, is able to produce both products on the same equipment

using the same employees.47 However, Superior Graphite, the other producer of SDGE, is not able to

produce LDGE on the same equipment as SDGE, due to the necessary size differences in equipment such

as forming dies, baking furnaces and saggers, rectifier sizes, and machine lines.48 ***.49 ***.50

Price

Table I-3 presents the average unit values (“AUVs”) and shares of U.S. producers’ and U.S.

importers’ U.S. shipments of SDGE and LDGE during the period for which data were collected in the

investigation. The AUVs of U.S. shipments of U.S.-produced SDGE and LDGE and imports from China

of both products increased in each year from 2005 to 2007.51 The AUV of U.S. shipments of U.S.-

produced SDGE increased by *** percent, while the AUV of U.S. shipments of imports of SDGE from

China rose by *** percent. The AUVs of U.S. producers’ U.S. shipments of both SDGE and LDGE

continued to rise between the interim periods of January-September 2007 and January-September 2008,

as did the AUVs of shipments of imports from China. Information on prices of SDGE is presented in

Part V of this report.
I-12

Table I-3

SDGE and LDGE: U.S. producers’ and U.S. importers’ average unit values and shares of U.S.

shipments, by product group, 2005-07, January-September 2007, and January-September 2008

Item

Calendar year January-September

2005 2006 2007 2007 2008

Unit value (per metric ton)

U.S. shipments of U.S.-produced product:

SDGE $*** $*** $*** $*** $***

LDGE 2,912 3,809 4,477 4,390 5,148

Weighted average *** *** *** *** ***

U.S. shipments of imports from China:

SDGE $2,108 $2,173 $2,348 $2,195 $2,811

LDGE 2,282 2,532 2,642 2,651 3,380

Weighted average 2,154 2,252 2,414 2,294 2,964

Share of quantity, based on metric tons (percent)

U.S. shipments of U.S.-produced product:

SDGE 11.6 10.8 9.3 9.6 10.4

LDGE 88.4 89.2 90.7 90.4 89.6

Total 100.0 100.0 100.0 100.0 100.0

U.S. shipments of imports from China:

SDGE 73.5 78.2 77.3 78.3 73.1

LDGE 26.5 21.8 22.7 21.7 26.9

Total 100.0 100.0 100.0 100.0 100.0

Source: Compiled from data submitted in response to Commission questionnaires.
 1

 Conference transcript, p. 31 (Kerwin).

 2

 *** U.S. commercial shipments of U.S. producers’ LDGE and imports of LDGE from China went to end users

over the period for which data were collected.

 3

 U.S. producer *** reported that *** percent of its sales were to ***.

II-1

PART II: CONDITIONS OF COMPETITION IN THE U.S. MARKET

U.S. MARKET SEGMENTS/CHANNELS OF DISTRIBUTION

SDGE are typically used as conductors of electricity in furnaces that heat or melt scrap metal or

other material used to produce steel and other materials. SDGE can also be applied in primary melting

and ladle metallurgy. The demand for SDGE is thus largely determined by steel production.1

 SDGE may

be produced according to different grades based on the relative use of the coke raw material and whether

the product goes through the pitch impregnation production step, including regular power (“RP”), normal

power (“NP”), medium power (“MP”), high power (“HP”), super high power (“SHP”), and ultra high

power (“UHP”). SDGE are also produced to a certain diameter size of 16 inches or less.

As shown in table II-1, a majority of U.S. producers’ U.S. commercial shipments of SDGE went

to *** over the period for which data were collected.2

 Specifically, in 2007, approximately *** percent

of U.S. producers’ U.S. commercial shipments of SDGE were to end users and *** percent were to

distributors.3

 *** U.S. commercial shipments of imports of SDGE from China were to end users. 

Based on questionnaire responses, there is some customer overlap for U.S. producers and

importers. *** of the *** largest customers reported by the two U.S. producers were listed as customers

by responding importers of Chinese product.

Table II-1

SDGE: Channels of distribution of U.S. commercial shipments of SDGE reported by U.S.

producers and importers, 2005-07, January-September 2007, and January-September 2008

* * * * * * *

When firms were asked to list market areas in the United States where they sell SDGE, the

responses showed that the market areas tended to be nationwide. Among the two U.S. producers, both

reported that they sell nationally. Among eight responding importers of SDGE from China, five reported

that they sell nationally. The three others listed specific geographic regions, including the Northeast, the

Mid-Atlantic, the Southwest, and the Southeast.

U.S. inland shipping distances for U.S.-produced SDGE were compared with those for imports

from China. For U.S. producers, *** percent of their U.S. sales in 2007 occurred within 100 miles of

their storage or production facility, *** percent were within distances of 101 to 1,000 miles, and

*** percent were at distances of over 1,000 miles from their facilities. For imports from China,

51 percent of sales occurred within 100 miles of importers’ storage facilities, 44 percent were within 101

to 1,000 miles, and 5 percent were to distances over 1,000 miles.

*** percent of U.S. producers’ sales and 70 percent of importers’ sales of imports from China

were produced to order. Lead times for delivery of SDGE ranged widely for both producers and

importers. For producers, lead times were *** days for sales from inventory and ranged from *** days to

as much as *** for sales produced to order. For importers, lead times ranged from one day to three

months for sales from inventory and from ten weeks to as much as six months or more for sales to order.
 4

 Hearing transcript, pp. 193-194 (Grosko).

 5

 Petitioners’ posthearing brief, exh. 1, p. 34.

 6

 Hearing transcript, p. 87 (Carney).

 7

 Hearing transcript, pp. 151-152 (Luberda). 

II-2

SUPPLY AND DEMAND CONSIDERATIONS

U.S. Supply

Domestic Production

The supply response of domestic SDGE producers to changes in price depends on such factors as

the level of excess capacity, the availability of alternate markets for U.S.-produced SDGE, inventory

levels, and the ability to shift to the manufacture of other products. The evidence indicates that U.S.

producers have the ability to respond to changes in price with relatively large changes in quantity, due

primarily to the ***.

Industry capacity

U.S. producers’ annual capacity utilization rates for SDGE decreased over the period for which

data were collected in the investigation, ranging from a high of *** percent in *** to a low of *** percent

in ***. This level of capacity utilization indicates that U.S. producers *** capacity with which they could

increase production of SDGE in the event of a price change.

Fifteen of 34 responding purchasers reported that one or more firms have refused or been unable

to supply SDGE since January 2005, with many purchasers attributing the supply shortages to U.S. SDGE

producers’ capacity shortages and high steel demand worldwide. Eleven purchasers reported that ***

was unable to supply all of their requirements, with seven specifically citing 2008. Four purchasers

reported that *** has been unable to supply SDGE, with two citing shortages in 2008, one purchaser

reporting that *** has been unable to supply 12-inch SDGE since 2006 to the present, and one reporting

that *** has removed all SDGE from its product line. Purchaser Magotteaux-Pulaski reported that

beginning in May 2008, it faced supply shortages of 9-inch SDGE and that Superior stated that it would

not be able to supply it with any 9-inch SDGE in 2008 or in 2009.4

 Petitioners reported that MagotteauxPulaski did not seek a price quote for 9-inch SDGE until September 2008 for its 2009 needs, at which

time Superior was responding to existing customers and is currently evaluating Magotteaux-Pulaski’s

request.5

U.S. producer Superior reported that it experienced a short-lived tight supply of SDGE beginning

in February or March of 2008 that was alleviated by August of 2008, attributing the tightness to steel

producers’ operating at full capacity during that period.6

 Petitioners also reported that, due to the filing of

this investigation in February 2008, purchasers began realizing in the middle of 2008 that they might not

be able to purchase the same amounts of SDGE from China that they had previously purchased and began

contacting domestic suppliers to cover their shortfalls; however, U.S. producers require three months to

produce SDGE and could not immediately supply the requested quantities. Petitioners report that U.S.

producers are not experiencing supply tightness now.7
 8

 The importer reported that orders placed by August 1, 2008 and reported to the Chinese government by midAugust for shipments before the end of 2008 were still eligible for the VAT rebate. Hearing transcript, p. 247

(Brashem). The VAT rebate was 13 percent. Hearing transcript, p. 199 (Liu).

II-3

Alternative markets

Exports by U.S. producers, as a share of their total shipments, decreased from *** percent in

2005 to *** percent in 2007. These data indicate that U.S. producers have *** ability to divert shipments

to or from alternative markets in response to changes in the price of SDGE.

Inventory levels

The ratio of end-of-period inventories to total shipments increased from *** percent in 2005 to

*** percent in 2006 before decreasing to *** percent in 2007. These data indicate that U.S. producers

*** ability to use inventories as a means of increasing shipments of SDGE to the U.S. market.

Production alternatives

U.S. producer *** reported that it uses the machinery, equipment, and workers used to make

SDGE in the production of other products, including LDGE ***. U.S. producer *** reported that it uses

the same workers used in producing SDGE to produce other products ***.

Subject Imports

The responsiveness of supply of imports from China to changes in price in the U.S. market is

affected by such factors as capacity utilization rates and the availability of home markets and other export

markets. Based on available information, producers in China have the capability to respond to changes in

demand with moderate changes in the quantity of shipments of SDGE to the U.S. market. The main

contributing factor to this degree of responsiveness of supply is the availability of alternative markets,

including the Chinese home market, combined with limited inventories and limited capacity. Three

purchasers reported supply shortages from Chinese suppliers in 2007 and 2008, with one reporting

shortages specifically in mid-2008 during the Olympics. An importer of SDGE from nonsubject sources

(***) reported that it attempted to import SDGE from China before the period of investigation, but

stopped doing so in 2003 due to unreliable supply from Chinese suppliers. An importer reported that the

Chinese government eliminated the value added tax (“VAT”) rebate on SDGE for shipments in 2009.8

Industry capacity

During the period of investigation, the capacity utilization rate for responding Chinese producers

of SDGE decreased from *** percent in 2005 to *** percent in 2007; it was projected to be *** percent

in 2008 and *** percent in 2009.

Alternative markets

Available data indicate that producers in China have the ability to divert shipments to or from

alternative markets in response to changes in the price of SDGE. Shipments of SDGE from China to the

United States increased irregularly from *** percent of total shipments in 2005 to *** percent in 2007. 

The share of China’s shipments to export markets other than the United States decreased irregularly from

*** percent in 2005 to *** percent in 2007, with the remainder mostly going to the home market.
 9

 Petitioners’ postconference brief, pp. 22-23. The re-opened mills are reportedly mostly blast furnaces that use

SDGE in diameters ranging from 12 to 16 inches. Petitioners also reported that the demand for LDGE is stronger

than the demand for SDGE because LDGE are consumed more quickly. Conference transcript, pp. 85-86 (Stinson). 

 10 Petitioners reported that steel demand worldwide is predicted to fall as much as 40 percent and that steel

production in China is expected to decline by 9 up to as much as 30 percent in 2009. Petitioners’ posthearing brief,

exh. 1, p. 31.

 11 Hearing transcript, p. 199 (Liu). Respondents reported that the Chinese government is enacting an economic

stimulus package of over $600 million for infrastructure projects which will reportedly result in increased demand

for steel and SDGE in China. Respondents’ posthearing brief, responses to Commissioners’ questions, p. 21.

 12 Conference transcript, p. 77 (Stinson).

II-4

Inventory levels

Responding Chinese producers’ inventories, as a share of total shipments, decreased from

*** percent in 2005 to *** percent in 2007. These data indicate that Chinese producers have some ability

to use inventories as a means of increasing shipments of SDGE to the U.S. market.

Nonsubject Imports

Based on responses to Commission questionnaires combined with adjusted official Commerce

statistics, U.S. imports of SDGE from nonsubject sources accounted for *** percent of the quantity of

total U.S. imports in 2007.

U.S. Demand

Demand Characteristics

The lack of substitutes for SDGE discussed below indicates that the demand for this product is

likely to be price inelastic. When asked how the overall demand for SDGE has changed since January

2005, *** and 6 of 10 responding importers stated that the demand had increased, mostly citing increased

steel production. Petitioners reported that the re-opening of old integrated steel mills over the last four

years contributed to the increase in demand for SDGE.9

 *** reported that U.S. steel production has

remained flat since 2004. This firm also reported that demand has shifted more towards the 16-inch

diameter graphite electrodes that are required by new ladle metallurgy furnaces. Petitioners reported that

they expect steel demand worldwide to be weak in 2009.10 Respondents reported that demand for SDGE

in China is increasing.11 Four importers reported that there has been no change in demand since 2005. 

Eighteen of 32 responding purchasers reported that demand has increased, while 8 reported no change

and 6 reported that it has decreased. One purchaser reported that demand for steel products utilizing

SDGE increased between January 2005 and mid-2008, but has since declined.

Substitute Products

*** and virtually all of the responding importers stated that there are no substitutes for SDGE. 

One importer reported that refurbished SDGE can be used as an alternative; however, U.S. producers

reported that they do not consider it a substitute.12 Another importer reported that purchasers have the

ability to change to a cupola furnace that does not require SDGE, noting that this change would not be

very efficient. This firm also reported that it is possible to increase the size of the clamp to accommodate

LDGE, noting that this substitution would require sufficient power. One purchaser reported that steel mill

ladle refining stations can be modified to use LDGE instead of SDGE. 
 13 The Commission received purchasers’ questionnaire responses from 36 purchasers. Among the largest

responding purchasers of SDGE are: ***. Purchasers were asked how many suppliers they generally contact before

making a purchase. Twenty-three purchasers reported that they contact two to four suppliers, 10 reported that they

contact more than four, two reported that they contact one to two suppliers, and one reported that it only uses one

supplier. 

II-5

Ten of 36 responding purchasers reported that there are alternative technologies to electric arc

furnaces that do not require SDGE, including induction furnaces or modification of ladle furnaces to

accept LDGE. One purchaser reported that switching the type of furnace would require *** in investment

and new environmental permits. Two purchasers reported that they have considered switching to

alternative equipment due to rising prices of SDGE.

Cost Share

According to responding producers, importers, and purchasers, the primary end use of SDGE is in

furnaces for steel melting and refining. Most responding producers and importers and 22 of

26 responding purchasers reported that the total cost of downstream steel products accounted for by

SDGE range from 1 to 5 percent. 

SUBSTITUTABILITY ISSUES

The extent of substitutability between domestic products and subject and nonsubject imports and

between subject and nonsubject imports is examined in this section. Information is based primarily on

questionnaire responses from producers, importers, and purchasers.13

Factors Affecting Purchasing Decisions

Available information indicates that a variety of factors are considered important in the

purchasing decision for SDGE. While quality and price were mentioned as being important factors in the

sale of the product, other factors such as availability and delivery are also important considerations. 

Purchasers were asked to list the top three factors that they consider when choosing a supplier of SDGE. 

Table II-2 summarizes the responses.

Table II-2

SDGE: Ranking of factors used in purchasing decisions, as reported by U.S. purchasers

Factor

Number of purchasers

Number one factor Number two factor Number three factor

Price 9 10 9

Quality 18 4 4

Availability 4 12 9

Other1 4 9 11

 1 Other factors include two firms reporting “cost per ton of steel melted” for the number one factor; one firm reporting “traditional

supplier” for the number one factor; one firm reporting “reliable supply” for the number one factor; three firms reporting “cost per

heat” for the number two factor; two firms reporting delivery for the number two factor; one firm reporting “packaging” for the

number two factor; one firm reporting “pre-arranged contracts” for the number two factor; one firm reporting “product consistency”

for the number two factor; one firm reporting “reliable supply” for the number two factor; five firms reporting “delivery” for the

number three factor; three firms reporting “cost per ton produced” as the number three factor; one firm reporting “sale

characteristics, including delivery, reliability, and availability” as the number three factor; one firm reporting “reliability” as the

number three factor; and one firm reporting “technical assistance” as the number three factor.

Source: Compiled from data submitted in response to Commission questionnaires.
II-6

Price was named by 9 purchasers as the number one factor generally considered in deciding from

whom to purchase SDGE, while 10 other purchasers indicated that it was the number two factor, and

9 purchasers responded it was the number three factor. As indicated in table II-3 30 of 35 responding

purchasers indicated that price was a “very important” factor in their purchasing decisions. 

Table II-3

SDGE: Importance of factors used in purchasing decisions, as reported by U.S. purchasers

Factor

Number of firms reporting

Very important Somewhat Important Not important

Availability 34 1 0

Delivery terms 20 12 3

Delivery time 27 7 1

Discounts and rebates 13 14 8

Extension of credit 5 16 14

Price 30 5 0

Minimum qty requirements 2 19 14

Packaging 9 17 9

Product consistency 34 1 0

Quality meets industry standards 33 2 0

Quality exceeds industry standards 13 15 6

Product range 3 14 18

Reliability of supply 35 0 0

Technical support/service 11 18 6

U.S. transportation costs 9 20 6

Heating costs (“cost per heat”) 28 4 3

Other1 50 0

 1 Other factor include two instances of “supply diversification,” one instance of “value in use,” one instance of

“iron content,” and one instance of “electrical consumption.”

Source: Compiled from data submitted in response to Commission questionnaires.

Quality was named by 18 purchasers as the number one factor generally considered in deciding

from whom to purchase SDGE, while 4 purchasers indicated that it was the number two factor and 4 other

purchasers responded it was the number three factor. Thirty-four of 35 responding purchasers indicated

that product consistency was a “very important” factor in their purchasing decisions and 33 of

35 purchasers indicated that quality meeting industry standards was a “very important” factor.

Availability was named by 4 purchasers as the number one factor generally considered in

deciding from whom to purchase SDGE, while 12 purchasers indicated that it was the number two factor

and 9 purchasers responded it was the number three factor. Thirty-four of 35 responding purchasers

indicated that availability was a “very important” factor in their purchasing decisions. All 35 responding

purchasers reported that “reliability of supply” was a very important factor. Twenty-eight of

35 responding purchasers reported that heating costs (or “cost per heat”) was a “very important” factor.
II-7

Twenty-four of 35 responding purchasers reported that they require suppliers for all of their

purchasers to become certified, while 3 reported that a portion of their purchases must be from a certified

supplier and 8 reported that they do not require qualification. Qualification times can reportedly last

anywhere from one month to one year. Of 31 responding purchasers, 29 purchasers reported that they

have already certified SDGE from Chinese suppliers. When asked if any suppliers have failed in their

attempts at certification, three purchasers cited importer *** for poor quality, one purchaser cited

importer *** for breakage, one cited importer *** for poor performance, one purchaser cited importer

*** for supplying SDGE from a non-approved plant, and one purchaser cited experiencing initial poor

quality with product from China, including nipple and thread size problems, as well as cracking. This

firm reported that those quality problems have been resolved. Another purchaser reported that it

experienced quality problems with SDGE from a nonsubject supplier in India in 2004.

Purchasers were asked how detailed they are when placing orders. A majority of responding

purchasers reported that their orders are very detailed, often including a specification for size and grade. 

Seven purchasers reported that their orders are not very detailed because they only use pre-qualified or

long-term suppliers. When asked how often their order specifications are met, 25 of 34 responding

purchasers responded “always,” while 5 responded “almost always” and 3 responded “usually” or

“often.” When asked how willing they are to accept orders that do not exactly meet their specifications,

22 of 32 responding purchasers reported that they are “never” willing (or “not willing”) to accept such

orders, while 7 reported that they are “not very” willing to accept them, and 3 reported that they would

consider accepting such orders if there was an economic benefit or based on acceptable performance of

the SDGE.

Comparisons of Domestic Product and Subject Imports

In order to determine whether U.S.-produced SDGE can generally be used in the same

applications as imports from China, producers and importers were asked whether the products can

“always,” “frequently,” “sometimes,” or “never” be used interchangeably. *** U.S. producers that

compared China with the United States reported that they are *** interchangeable, as shown in table II-4. 

A majority of the importers that compared China with the United States reported that they are frequently

interchangeable. Nearly all of responding purchasers reported that U.S. product and that from China are

always or frequently interchangeable.

Table II-4

SDGE: Perceived degree of interchangeability of product produced in the United States and in

other countries

Country comparison

U.S. producers U.S. importers U.S. purchasers

AFSNAFSNAFSN

U.S. vs. China *** *** *** *** 2 7 1 0 22 6 1 2

U.S. vs. Nonsubject *** *** *** *** 2 5 1 0 17 5 1 2

China vs. Nonsubject *** *** *** *** 2 5 1 0 18 4 2 1

Note: “A” = Always, “F” = Frequently, “S” = Sometimes, and “N” = Never.

Source: Compiled from data submitted in response to Commission questionnaires.
 14 Petitioners’ postconference brief, p. 23. Respondents contend that U.S. producers try to sell customers more

expensive, higher grades of SDGE than are necessary. Conference transcript, p. 10 (Levinson). Petitioners maintain

that U.S. producers produce according to customer specifications. Petitioners’ postconference brief, p. 26. 

 15 Conference transcript, pp. 12, 46 (Stinson).

 16 Questionnaire response, section II-11.

 17 Conference transcript, p. 20 (Stinson).

 18 Respondents’ posthearing brief, responses to Commissioners’ questions, p. 9.

 19 Conference transcript, p. 122 (Kearney). 

 20 Hearing transcript, p. 290 (Levinson).

 21 Petitioners’ postconference brief, p. 26.

 22 Petitioners’ postconference brief, p. 26. Conference transcript, p. 51 (Stinson).

II-8

*** reported that they are capable of producing the full product range of all grades and sizes of

SDGE.14 U.S. producer SGL Carbon reported that it currently produces SDGE in diameters of 14 and

16 inches and stopped production of SDGE in diameters of 10 and 12 inches in 2006.15 U.S. producer

Superior Graphite reported that it produces SDGE in diameters ***.16 U.S. producers reported that

imports from China compete in the full range of SDGE products.17 Respondents, however, report that

imports from China have historically competed mostly in the 20-inch and smaller sizes of graphite

electrodes because producers in China have lacked the sophistication to produce larger sizes.18 In the

preliminary phase of this investigation, one importer reported that U.S. producers are unwilling to

produce SDGE in diameters of 3 to 8 inches and one importer reported that it sells Chinese graphite

electrodes in diameters ranging from 3 to 24 inches.19

Purchasers were asked if certain grades or sizes of SDGE were only available from a single

source; 32 of 34 responding purchasers responded “no.” Thirteen of 36 responding purchasers reported

that they use both HP and UHP grades of SDGE. While most purchasers reported that UHP grade SDGE

contain higher amounts of premium needle coke and is more well-suited to high power applications, two

purchasers reported that the grades are not necessarily consistent across suppliers and that they run trials

to determine the performance of the SDGE. 

Respondents have reported that U.S. producers try to sell customers higher-priced, higher grades

of SDGE than the customer actually requires.20 Purchasers were asked if they ever use a higher grade of

SDGE when they could be using a lower grade. Twenty-five of 34 responding purchasers responded

“no,” while 9 reported “yes,” mostly citing better value based on consumption of the UHP grade relative

to the HP grade. One purchaser also reported that it would purchase a higher grade if the lower grade

were unavailable and another purchaser reported that higher grades have lower breakage.

Petitioners report that SDGE are not sold on the basis of an industry standard.21 U.S. producers

report that they produce to order because customers specify their performance needs.22 *** reported that

all SDGE within a specific diameter can be interchanged, provided that the performance and value of the

product are acceptable to the customer. One importer reported that industry standards set by the National

Electrical Manufacturers Association (NEMA), the International Electrotechnical Commission (IEC), and

the Japanese Industrial Standard (JIS) have standardized the diameter and lengths for SDGE; however,

this firm also reported that the operating parameters of the particular purchaser (including height

limitations in the work area) determine which grades of SDGE are suitable for its operation.

Of 35 responding purchasers, 27 reported that they “always” know whether the SDGE they

purchase is imported or produced domestically and 14 reported that they “always” know the

manufacturer.

Seventeen of 29 responding purchasers reported that SDGE produced in the United States always

meet minimum quality specifications; 16 of 34 responding purchasers reported that SDGE produced in

China always meet minimum quality specifications.
 23 Hearing transcript, p. 81 (Hartquist).

 24 Hearing transcript, p. 85 (Stinson).

 25 Hearing transcript, pp. 25-26 (Carney).

 26 Hearing transcript, p. 85 (Stinson).

 27 Hearing transcript, p. 246 (Wood).

II-9

As indicated in table II-5, *** U.S. producers that compared the United States with China said

that differences other than price are *** significant. The majority of the responding importers that

compared the United States with China said that the differences are sometimes significant, with the

remainder reporting that such differences are always or frequently significant. *** reported that the

quality and availability of SDGE imported from China have improved. Petitioners reported that 14- and

16-inch sizes of UHP SDGE from China have had more quality problems than smaller sizes of SDGE, but

that their overall quality is expected to improve.23 Petitioners reported that SDGE from China work

particularly well in low-intensity operations, typically for customers that can tolerate higher consumption

rates, which introduces more carbon into the heat.24 Superior also reported that, even in instances where

SDGE from China are consumed more quickly than domestic product, purchasers state that the SDGE

from China are still lower priced than the domestic product.25 Petitioners also reported that there is a

limited global supply of needle coke (which is needed to produce SDGE for higher-intensity

applications), which also limits Chinese producers’ capability to manufacture SDGE suitable for higherintensity applications.26

Table II-5

SDGE: Differences other than price between products from different sources1

Country comparison

U.S. producers U.S. importers

AFSNAF SN

U.S. vs. China *** *** *** *** 2 2 5 0

U.S. vs. Nonsubject *** *** *** *** 1 1 5 0

China vs. Nonsubject *** *** *** *** 2 1 4 0

 1

 Producers and importers were asked if differences other than price between SDGE produced in the United

States and in other countries are a significant factor in their firms’ sales of SDGE.

Note: “A” = Always, “F” = Frequently, “S” = Sometimes, and “N” = Never.

Source: Compiled from data submitted in response to Commission questionnaires.

Purchaser Wheelabrator Abrasive reported that the consumption rates for SDGE from U.S.

producer Superior and Chinese import suppliers are the same.27 Another importer (***) reported that

while SDGE from China are lower priced, higher consumption of the SDGE is required to obtain the

same amount of melted steel, but that Chinese SDGE are still cost-effective for many customers. Another

importer, ***, reported that the cost of a poor-performing SDGE will always be greater than the

difference in the sales prices; this firm also noted that while U.S. producers may not have an advantage

with regard to the performance of their SDGE, they should have superior product availability and

technical support, but that distributors of imported product also have advantages in those areas. One

importer reported that there were quality concerns with the SDGE from China in the past, but that the

quality of the Chinese product has been improving. Two importers reported that the imports from China
II-10

are available in a wider variety of grades than U.S.-produced products or imports from other countries. 

One purchaser reported that SDGE produced in the United States do not have ***.

For some factors that all or almost all responding purchasers indicated were “very important” in

their purchasing decisions, including reliability of supply and quality meets industry standards (see table

II-3), purchaser comparisons as shown in table II-6 indicate that the domestic product is mostly

comparable to the product imported from China. However, a majority of purchasers reported that the

U.S. product is inferior to the product from China with respect to “lower price.” A number of purchasers

reported that the U.S. product is superior to the product from China with respect to “delivery time” and

“technical support/service.”

Table II-6

SDGE: Comparisons between U.S.-produced and subject imported product, as reported by U.S.

purchasers

Factor

China

SC I

Availability 2 15 4

Delivery terms 1 181 2

Delivery time 8 101 2

Discounts offered 1 17 1

Extension of credit 0 17 4

Lower price2 0 4 17

Minimum quantity requirements 0 20 0

Packaging 2 19 0

Product consistency 3 17 1

Quality meets industry standards 1 203 0

Quality exceeds industry standards 1 193 0

Product range 1 19 0

Reliability of supply 1 16 4

Technical support/service 7 11 1

Lower U.S. transportation costs 2 18 0

Heating costs (“cost per heat”) 2 16 2

Other4 011

 1 One response included in this column for this factor rated the U.S. product “comparable/inferior” to the subject imports.

 2 A rating of superior means that the price is generally lower. For example, if a firm reports “U.S. superior,” this means that it

rates the U.S. price generally lower than the subject import price.

 3 One response included in this column for this factor rated the U.S. product “superior/comparable” to the subject imports.

 4 Other factors include one instance of “value in use” with a ranking of “comparable” and one instance of “supply diversity” with

a ranking of “inferior.”

Note.--S=U.S. product is superior, C=U.S. product is comparable, I=U.S. product is inferior.

Source: Compiled from data submitted in response to Commission questionnaires.
 28 Conference transcript, pp. 78-79 (Stinson, Carney).

 29 Hearing transcript, p. 216 (Hancock).

 30 Hearing transcript, p. 265 (Brashem).

 31 Hearing transcript, p. 265 (Brashem).

II-11

Other Country Comparisons

In addition to comparisons between the U.S. product and imports from the subject country, U.S.

producer and importer comparisons between the United States and imports from nonsubject countries and

between subject imports and nonsubject imports are also shown in tables II-4 and II-5. *** reported that

the quality of SDGE from nonsubject countries, particularly Mexico, is comparable with that of domestic

product and of Chinese product.28 One purchaser reported that the quality of SDGE it obtained from

Mexico two or three years ago was inferior to the SDGE it was using.29 Another purchaser reported that it

experienced problems with the quality of the threads of SDGE from India. One importer reported that

SDGE imported from the Ukraine at the time the petition was filed did not meet customer requirements

because the product offered was not impregnated, was of a different nipple size, and was of a different

connecting machine size.30 This importer also reported that there was a lack of availability of SDGE from

India at the time the petition was filed.31

Five of 12 responding purchasers reported that SDGE from India “always” meet minimum

quality specifications and 5 responded “usually.” Five of 11 responding purchasers reported that SDGE

from Mexico “always” meet minimum quality specifications, and the remaining 6 responded “usually.” 

Four responding purchasers reported that SDGE from Japan “always” or “usually” meet minimum quality

specifications; two responding purchasers reported that SDGE from Russia “always” or “usually” meet

them; one reported that SDGE from Ukraine “always” meet them and another reported that SDGE from

Ukraine “usually” meet them; one reported that SDGE from the United Kingdom “usually” meet them;

and one reported that SDGE from ***, an importer of SDGE from Mexico, Brazil, and South Africa,

“usually” meet minimum quality specifications.

When asked if they had changed the amount of their purchases of SDGE from China due to the

filing of the petition or due to the Department of Commerce’s preliminary determination of sales at less

than fair value, 19 of 35 responding purchasers reported that they had not changed their purchases, six of

which cited lack of availability from U.S. suppliers. Sixteen purchasers reported that they had changed

their purchases from China, with 3 specifically stating that they had switched to U.S. suppliers, 7 stating

that they had switched to nonsubject sources (including Japan, Mexico, India, the United Kingdom, and

Ukraine), one reporting that it was in the process of testing SDGE from Mexico and India, and one

reporting that it had switched to another Chinese supplier that had a relative low preliminary dumping

margin.

When purchasers were asked if the relative shares of their total purchases of SDGE from different

sources had changed since 2005, ten reported that their share of purchases from U.S. producers had

decreased, whereas thirteen purchasers reported that their share of purchases of imports from China had

increased (with one citing 2005 to 2007 in particular), mostly citing price and availability. Two

purchasers reported that their share of purchases from U.S. producers had increased (with one citing 2008

in particular); five reported that the share of their purchases of imports from China had decreased (with

two citing 2008 in particular); three reported that their share of purchases of imports from Mexico had

decreased; three reported that their share of purchases of imports from Mexico had increased; two

reported that their share of purchases of imports from India had increased; two reported that their share of

purchases of imports from India had decreased; and one reported that its share of purchases of imports

from the United Kingdom had increased.

Purchasers that had replaced, to some degree, their purchases of imports from China with imports

from nonsubject countries were asked if they paid a higher price for those nonsubject imports than they
 32 A supply function is not defined in the case of a non-competitive market.

 33 The substitution elasticity measures the responsiveness of the relative U.S. consumption levels of the subject

imports and the domestic like products to changes in their relative prices. This reflects how easily purchasers switch

from the U.S. product to the subject products (or vice versa) when prices change.

II-12

had been paying for imports from China before this case was filed. Of 29 responding purchasers, 16

responded “no,” that they were not paying a higher price for nonsubject imports than they had been

paying for imports from China, and 13 responded “yes.”

ELASTICITY ESTIMATES

U.S. Supply Elasticity32

The domestic supply elasticity for SDGE measures the sensitivity of the quantity supplied by

U.S. producers to changes in the U.S. market price of SDGE. The elasticity of domestic supply depends

on several factors including the level of excess capacity, the ease with which producers can alter capacity,

producers’ ability to shift to production of other products, the existence of inventories, and the availability

of alternate markets for U.S.-produced SDGE. Analysis of these factors above indicates that the U.S.

industry is likely to be able to increase or decrease shipments to the U.S. market; an estimate in the range

of 3 to 5 is suggested.

U.S. Demand Elasticity

The U.S. demand elasticity for SDGE measures the sensitivity of the overall quantity demanded

to a change in the U.S. market price of SDGE. This estimate depends on factors discussed above such as

the existence, availability, and commercial viability of substitute products, as well as the component share

of SDGE in the production of downstream products. Based on the available information, the aggregate

demand elasticity for SDGE is likely to be in the range of -0.5 to -0.75.

Substitution Elasticity

The elasticity of substitution depends upon the extent of product differentiation between the

domestic and imported products.33 Product differentiation, in turn, depends upon such factors as quality

and conditions of sale (availability, sales terms/discounts, etc.). Based on available information, the

elasticity of substitution between U.S.-produced SDGE and SDGE from China is likely to be in the range

of 2 to 4.
 1

 In the United States, SGL Carbon produces 14-inch and 16-inch diameter SDGE and 18-inch through 32-inch

diameter LDGE. SGL Carbon noted that it used to produce down to 2-inch diameter SDGE. Conference transcript,

p. 45 (Stinson). Superior Graphite cannot produce graphite electrodes larger than 16 inches in diameter. Conference

transcript, pp. 49-50 (Carney). 

III-1

PART III: U.S. PRODUCERS’ PRODUCTION, SHIPMENTS, AND

EMPLOYMENT

The Commission analyzes a number of factors in making injury determinations (see 19 U.S.C. §§

1677(7)(B) and 1677(7)(C)). Information on the margin of dumping was presented earlier in this report

and information on the volume and pricing of imports of the subject merchandise is presented in Parts IV

and V. Information on the other factors specified is presented in this section and/or Part VI and (except as

noted) is based on the questionnaire responses of two firms that accounted for 100 percent of U.S.

production of SDGE during 2007.

U.S. PRODUCERS

The Commission sent producers’ questionnaires to two firms, SGL Carbon and Superior

Graphite, identified in the petition as U.S. producers of SDGE. The Commission received completed

producers’ questionnaire responses from both firms, accounting for all known U.S. production of SDGE

during the period of investigation.1

 The Commission asked producers to identify related firms that 

import or produce SDGE: *** reported related production facilities in *** and *** (*** and ***,

respectively). Table III-1 presents U.S. producers’ reported positions on the petition, plant locations,

ownership, and shares of total reported U.S. production of SDGE in 2007.

Table III-1

Graphite electrodes: U.S. producers, positions on petition, plant locations, and shares of U.S.

production in 2007

Firm name

Position

on petition Plant locations Parent company

Share of

reported 2007

U.S. SDGE

production

(percent)

Share of

reported 2007

U.S. LDGE

production

(percent)

Share of

reported 2007

U.S. graphite

electrode

production

(percent)

SGL Carbon LLC Support

(petitioner)

Morganton, NC

Ozark, AR

***% SGL Carbon

AG (Germany) *** *** ***

Superior Graphite Co. Support

(petitioner)

Russellville, AR ***% Superior

Graphite Co. *** ***

Total SDGE 100.0 ***

C/G Electrodes, LLC *** St. Marys, PA ***% C/G Electrodes *** ***

SGL Carbon LLC Support

(petitioner) Hickman, KY ***% SGL CarbonAG (Germany) *** *** (1

)

Showa Denko

Carbon, Inc. *** Ridgeville, SC ***% Showa DenkoKK (Japan) *** ***

Total LDGE 100.0 ***

 1

 Not presented here to avoid double-counting.

Source: Compiled from data submitted in response to Commission questionnaires.
 2

 Producers’ questionnaire responses, section II-4.

 3

 ***. E-mail from ***.

 4

 ***.

III-2

The Commission also sent producers’ questionnaires to two firms, Showa Denko and C/G

Electrodes, identified as U.S. producers of LDGE. The Commission received completed producers’

questionnaires from both firms, which, along with SGL Carbon, accounted for all known U.S. production

of LDGE during the period of investigation; *** the petition. A summary of data collected in the

investigation on LDGE is presented in appendix C, table C-2.

U.S. PRODUCTION, CAPACITY, AND CAPACITY UTILIZATION

U.S. producers’ capacity, production, and capacity utilization data for SDGE and LDGE are

presented in table III-2. These data show that SDGE production capacity remained stable during 2005 to

2006, declining by *** percent in 2007, with average capacity utilization declining by *** percentage

points over the same period. U.S. producers’ capacity to supply SDGE was *** below apparent U.S.

consumption of SDGE in each year and period for which data were collected. U.S. producers increased

their production of LDGE over the period for which data were collected.

Table III-2

Graphic electrodes: U.S. capacity, production, and capacity utilization, 2005-07, JanuarySeptember 2007, and January-September 2008

* * * * * * *

The Commission asked domestic producers to describe any plant openings, relocations,

expansions, acquisitions, consolidations, closures, and prolonged shutdowns. *** reported closing or

reducing production lines of SDGE.

The Commission asked domestic producers to describe the constraints that limit production

capacity.2

 *** responded that the baking stage of processing limited capacity to produce SDGE. ***

reported that *** also constrained production capacity of SDGE. *** were also noted as constraints by

***.

***, accounting for *** percent of total reported U.S. production of SDGE in 2007, reported

producing other products, namely LDGE *** on the same machinery and equipment, and with the same

workers used in the production of SDGE. SDGE, LDGE, *** reportedly accounted for *** of its total

production in 2007. *** reported producing products ***, accounting for *** percent of total production

in 2007.3

U.S. PRODUCERS’ SHIPMENTS

Table III-3 presents information on U.S. producers’ shipments of SDGE. U.S. producers’ U.S.

shipments, in terms of quantity, fell from 2005 to 2007 by *** percent. On a value basis, U.S. producers’

U.S. shipments increased by *** percent from 2005 to 2007, which resulted in an increase in the average

unit value of *** percent. *** the U.S. producers reported transfers to related firms, while *** reported

export shipments.4

 *** reported internal consumption.
 5

 Petitioners estimated the breakout of 18 inch and above graphite electrodes by use:

* * * * * * *

 6 ***.

III-3

Table III-3

SDGE: U.S. producers’ shipments, by type, 2005-07, January-September 2007, and JanuarySeptember 2008

* * * * * * *

Table III-4 presents data for U.S. producers’ production, U.S. shipments, and exports of graphite

electrodes, by size, during the period for which data were collected. Production of sizes above 16 inches

rose as a share of the total from 2005 (*** percent) to 2007 (*** percent) and continued to rise during the

interim periods. Table III-5 presents data for U.S. producers’ U.S. shipments of graphite electrodes by

size and use for 2007. *** graphite electrodes shipped in the 8-inch to 16-inch sizes were to foundry and

steel refining and those above 16 inches were for ***.5

Table III-4

Graphite electrodes: U.S. producers’ production, U.S. shipments, and exports, by size, 2005-07,

January-September 2007, and January-September 2008

* * * * * * *

Table III-5

Graphite electrodes: U.S. producers’ U.S. shipments, by size and use in 2007

* * * * * * *

U.S. PRODUCERS’ IMPORTS AND PURCHASES

During the period of investigation, neither U.S. SDGE producer reported imports, ***.6

 ***.

U.S. PRODUCERS’ INVENTORIES

Data on U.S. producers’ end-of-period inventories of SDGE for the period of investigation are

presented in table III-6. Inventories increased by nearly *** percent from 2005 to 2007 (they ***

between 2005 and 2006). Inventories as a ratio to production, to U.S. shipments, and to total shipments

followed a similar trend. However, inventories declined by *** percent between January-September

2007 and January-September 2008.

Table III-6

SDGE: U.S. producers’ end-of-period inventories, 2005-07, January-September 2007, and JanuarySeptember 2008

* * * * * * *
III-4

U.S. EMPLOYMENT, WAGES, AND PRODUCTIVITY

Data provided by U.S. producers on the number of production and related workers (“PRWs”)

engaged in the production of SDGE, the total hours worked by such workers, and wages paid to such

PRWs during the period for which data were collected in this investigation are presented in table III-7. 

PRWs producing SDGE declined by *** percent from 2005 to 2007.

Table III-7

SDGE: U.S. producers’ employment-related indicators, 2005-07, January-September 2007, and

January-September 2008

* * * * * * *
 1

 The Commission sent questionnaires to those firms identified in the petition, along with firms that, based on a

review of data provided by U.S. Customs and Border Protection (“Customs”), may have imported at least 100,000

kilograms or greater than one percent of total imports under HTS subheading 8545.11.00 in any one year since 2004.

 2

 GrafTech reported that *** to Monterrey, Mexico. This was done for several reasons, including ***. 

Graftech’s importers’ questionnaire response, section II-2.

 3

 Respondents contended that the importers which submitted the importer questionnaires in the preliminary phase

of the investigation represented virtually 100 percent of imports of SDGE from China. Conference transcript, p. 8

(Levinson).

 4

 The U.S. exports of SDGE from Mexico reported by GrafTech are ***. Imports from Mexico account for ***

of nonsubject imports for each year during the period of investigation.

 5

 Petition, Injury Exh. 2. Coverage of these countries appears to be incomplete due to limited information

received in response to the Commission’s questionnaire. Commission staff elected to adjust official import statistics

by the estimates provided in the petition based on the petitioners’ industry knowledge. These are believed to be the

best available data as no other alternative data were provided to Commission staff. SDGE was estimated to be

60 percent of official imports from India; 10 percent from Germany, Japan, Poland, and Spain; 0 percent from

Canada; and 50 percent from all other sources (other than China and Mexico).

IV-1

PART IV: U.S. IMPORTS, APPARENT CONSUMPTION, AND

MARKET SHARES

U.S. IMPORTERS

Importer questionnaires were sent to 32 firms believed to be importers of subject SDGE, as well

as to all U.S. producers of SDGE and LDGE.1

 Usable questionnaire responses were received from

12 companies, representing 58.3 percent of total imports from China in the period of investigation under

HTS subheading 8545.11.00, a “basket” category. *** and *** accounted for *** percent of reported

imports of SDGE from China in 2007, and *** percent of adjusted imports from all other sources. ***

also reported imports from ***. *** accounted for *** percent of adjusted imports from all other sources

in 2007.2

 Table IV-1 lists all responding U.S. importers of SDGE from China and other sources, their

locations, and their shares of U.S. imports, in 2007.

Table IV-1

SDGE: U.S. importers, source(s) of imports, U.S. headquarters, and shares of imports in 2007

* * * * * * *

U.S. IMPORTS

Table IV-2 presents data for U.S. imports of SDGE from China and all other sources. Data on

U.S. imports from China presented in this report are based on questionnaire responses, as official statistics

are from a basket classification that is broader than the subject product.3

 Data on U.S. imports from

Mexico presented in this report (table VII-8) are based on GrafTech Mexico S.A. de C.V.’s response to

the Commission’s foreign producer’s questionnaire, as GrafTech is believed to represent *** of exports

from Mexico.4

 Data on U.S. imports from sources other than China and Mexico are based on the

estimates provided in the petition.5

The quantity of U.S. imports from China increased by 36.7 percent from 2005 to 2007, and

slipped by 3.3 percent between January-September 2007 and January-September 2008. The value of U.S.

imports from China increased, rising by 51.7 percent and 24.5 percent over the same periods.
IV-2

Table IV-2

SDGE: U.S. imports, by sources, 2005-07, January-September 2007, and January-September 2008

Source

Calendar year January-September

2005 2006 2007 2007 2008

Quantity (metric tons)

China 10,082 13,161 13,784 10,458 10,112

Nonsubject *** *** *** *** ***

Total *** *** *** *** ***

Value (1,000 dollars)

1

China 15,819 21,638 24,003 18,161 22,618

Nonsubject *** *** *** *** ***

Total *** *** *** *** ***

Unit value (per metric ton)

1

China $1,569 $1,644 $1,741 $1,737 $2,237

Nonsubject *** *** *** *** ***

Average *** *** *** *** ***

Share of quantity (percent)

China *** *** *** *** ***

Nonsubject *** *** *** *** ***

Total 100.0 100.0 100.0 100.0 100.0

Share of value (percent)

China *** *** *** *** ***

Nonsubject *** *** *** *** ***

Total 100.0 100.0 100.0 100.0 100.0

1

 Landed, U.S. port of entry, duty-paid. Because of the methodology by which official Commerce statistics were

adjusted, value data for countries other than China and Mexico may be overstated to the extent that the unit values

of SDGE are lower than the unit values of other products imported under the same HTS subheading.

Source: Compiled from data submitted in response to Commission questionnaires and from adjusted official 

Commerce statistics.
 6

 74 FR 2049, January 14, 2009, presented in app. A. When petitioners file timely allegations of critical

circumstances, Commerce examines whether there is a reasonable basis to believe or suspect that (1) either there is a

history of dumping and material injury by reason of dumped imports in the United States or elsewhere of the subject

merchandise, or the person by whom, or for whose account, the merchandise was imported knew or should have

known that the exporter was selling the subject merchandise at LTFV and that there was likely to be material injury

by reason of such sales; and (2) there have been massive imports of the subject merchandise over a relatively short

period.

 7

 Sections 703(a)(1), 705(b)(1), 733(a)(1), and 735(b)(1) of the Act (19 U.S.C. §§ 1671b(a)(1), 1671d(b)(1),

1673b(a)(1), and 1673d(b)(1)).

 8

 Section 771(24) of the Act (19 U.S.C. § 1677(24)).

IV-3

CRITICAL CIRCUMSTANCES

On January 6, 2009, Commerce issued its final determination that “critical circumstances” exist

with regard to imports from China of SDGE from the Fangda Group, the separate rate companies, and the

PRC-wide entity, including Fushun Jinly.6

 In this investigation, if both Commerce and the Commission

make affirmative final critical circumstances determinations, certain subject imports may be subject to

antidumping duties retroactive by 90 days from August 21, 2008, the effective date of Commerce’s

preliminary affirmative LTFV determination.

The following are the reported imports into the United States, by month (in metric tons), derived

from importers’ questionnaire responses: July 2007 - ***; August 2007 - ***; September 2007 - ***;

October 2007 - ***; November 2007 - ***; December 2007 - ***; January 2008 - ***; February 2008 -

***; March 2008 - ***; April 2008 - ***; May 2008 - ***; and June 2008 - ***.

NEGLIGIBILITY

The statute requires that an investigation be terminated without an injury determination if imports

of the subject merchandise are found to be negligible.7

 Negligible imports are generally defined in the

Tariff Act of 1930, as amended, as imports from a country of merchandise corresponding to a domestic

like product where such imports account for less than 3 percent of the volume of all such merchandise

imported into the United States in the most recent 12-month period for which data are available that

precedes the filing of the petition or the initiation of the investigation. However, if there are imports of

such merchandise from a number of countries subject to investigations initiated on the same day that

individually account for less than 3 percent of the total volume of the subject merchandise, and if the

imports from those countries collectively account for more than 7 percent of the volume of all such

merchandise imported into the United States during the applicable 12-month period, then imports from

such countries are deemed not to be negligible.8

 Imports from China accounted for *** percent of total

imports of SDGE by quantity during 2007.

APPARENT U.S. CONSUMPTION

Data concerning apparent U.S. consumption of SDGE during the period of investigation are

shown in table IV-3 and figure IV-1. The quantity of apparent U.S. consumption increased by

*** percent from 2005 to 2007, but decreased by *** percent from January-September 2007 to JanuarySeptember 2008. In terms of value, apparent U.S. consumption increased by *** percent between 2005

and 2007, and by *** percent between January-September 2007 and January-September 2008.
IV-4

Table IV-3

SDGE: U.S. shipments of domestic product, U.S. shipments of imports, and apparent U.S.

consumption, 2005-07, January-September 2007, and January-September 2008

* * * * * * *

Figure IV-1

SDGE: Apparent U.S. consumption, by sources, 2005-07, January-September 2007, and JanuarySeptember 2008

* * * * * * *

U.S. MARKET SHARES

U.S. market share data are presented in table IV-4. Shares of both quantity and value of imports

from China of SDGE increased from 2005 to 2007, with Chinese import shares of U.S. consumption

growing by *** percentage points in quantity and *** percentage points in value. U.S. producers’ share

(by quantity) of the domestic market decreased by *** percentage points during this same period, but

increased *** between the interim periods.

Table IV-4

SDGE: U.S. consumption and market shares, 2005-07, January-September 2007, and JanuarySeptember 2008

* * * * * * *

RATIO OF IMPORTS TO U.S. PRODUCTION

Information concerning the ratio of imports to U.S. production of SDGE is presented in table

IV-5. Subject imports were equivalent to *** percent of U.S. production during 2005. This level

increased to *** percent in 2006, *** percent in 2007, and fell to *** percent in January-September 2008.

Table IV-5

SDGE: U.S. production, U.S. imports, and ratios of imports to U.S. production, 2005-07, JanuarySeptember 2007, and January-September 2008

* * * * * * *
 1

 Petitioners’ postconference brief, p. 25.

 2

 Hearing transcript, p. 85 (Stinson).

 3

 According to a steel industry source, the price of needle coke has reportedly doubled since January 2005 and has

increased by one-third since mid-2006. “Steel Guru,” January 31, 2008. (http://www.steelguru.com/news/index

/2008/01/31/MzU3MDk=/US_steel_mini_mills_boost_demand_for_specialized_coke_product.html).

 4

 The spot price for oil decreased by 26 percent from September to October 2008 and continued to decline by

another 46.3 percent from October 2008 to December 2008. Energy Information Administration. 

(Http://tonto.eia.doe.gov/dnav/pet/pet_pri_spt_s1_m.htm). 

 5

 Respondents’ postconference brief, p. 3.

V-1

0

20

40

60

80

100

120

140

Dollars per barrel

Crude oil

PART V: PRICING AND RELATED INFORMATION

FACTORS AFFECTING PRICES

Raw Material Costs

Petroleum coke, either in the form of needle coke, anode coke, or other grades, and petroleum

pitch or coal tar pitch are the principal raw materials used in producing SDGE.1

 U.S. producers reported 

that there has been a limited supply of needle coke globally.2

 U.S. producers also reported that their raw

material costs increased by *** percent on a per-unit basis from 2005 to 2007.3

 The spot price for oil,

which determines the cost of the petroleum-based raw materials, increased by 122 percent from January

2005 to September 2008, peaking in June 2008 and declining thereafter, as shown in figure V-1.4

Respondents report that the prices of raw materials have also increased substantially in China over the

period of investigation.5

Figure V-1

SDGE: Monthly spot prices of crude oil, January 2005-September 2008

Source: Energy Information Administration, November 18, 2008.
 6

 The estimated cost was obtained by subtracting the customs value from the c.i.f. value of the imports for 2007

and then dividing by the customs value. This calculation used import data on HTS subheading 8545.11.00.

V-2

0.0

20.0

40.0

60.0

80.0

100.0

120.0

140.0

2005200620072008

(January-March 2005=100)

Nominal

Transportation Costs to the U.S. Market

Transportation costs for SDGE shipped from China to the United States averaged 9.0 percent of

the customs value during 2007. This estimate is derived from official import data.6

U.S. Inland Transportation Costs

Reported transportation costs on U.S. inland shipments of SDGE ranged from *** to *** percent

of the delivered price for U.S. producers. For importers from China, the costs ranged from less than one

percent to as much as 12.5 percent of the delivered price, with most firms citing costs of 3 percent or less.

Exchange Rate

While the nominal exchange rate for the Chinese yuan was pegged to the U.S. dollar during the

first two quarters of 2005, the dollar depreciated by 21.0 percent relative to the yuan in nominal terms

from the first quarter of 2005 to the third quarter of 2008, as shown in figure V-2. A real value is

unavailable.

Figure V-2

Exchange rate: Index of the nominal exchange rate of the Chinese currency relative to the U.S.

dollar, by quarters, January 2005-September 2008

Source: International Monetary Fund, International Financial Statistics, November 18, 2008.
 7

 One purchaser (***) reported that it would pay a price premium for U.S.-produced SDGE.

 8

 Hearing transcript, p. 26 (Carney).

 9

 U.S. producer *** reported that *** percent of its sales are on a ***.

V-3

PRICING PRACTICES

Pricing Methods

When questionnaire respondents were asked how they determined the prices that they charge for

SDGE, responses were varied. Among U.S. producers, *** were most often cited. Among importers,

transaction-by-transaction negotiations and the use of contracts for multiple shipments were most often

cited. *** producers *** importers reported the use of price lists. 

Prices of SDGE are most commonly quoted on a delivered rather than an f.o.b. basis, for both

U.S. producers and importers.

Four of 34 responding purchasers reported that the lowest price will “always” win a contract or

sale. Fourteen purchasers reported that the lowest price will “usually” win a contract or sale,

13 purchasers reported “sometimes,” and three purchasers reported “never.” 

Twenty-two purchasers reported that they had purchased SDGE from one source although a

comparable product was available from another source at a lower price, with most purchasers citing a

desire to have multiple sources of supply or to ensure a reliable supply; others cited cost effectiveness and

delivery or lead times. When purchasers were asked if they are willing to pay a price premium for one

grade of SDGE over another, 17 of 36 responding purchasers responded that they would be willing to pay

a price premium for SDGE of a high enough quality that would result in lower consumption to produce

the same amount of steel.7

 Petitioners reported that, even in instances when SDGE from China must be

consumed more quickly than domestic product, purchasers state that the SDGE from China is still lower

priced than the comparable domestic product.8

 One importer (***) reported that while higher

consumption of SDGE from China is required to obtain the same amount of melted steel, the Chinese

SDGE are still cost-effective for many customers. Another importer (***) reported that the cost of a

poor-performing SDGE will always be greater than the difference in the sales prices.

Twenty-six of 36 purchasers reported firms that they considered price leaders, with 11

specifically naming *** (an importer of SDGE from nonsubject sources), 8 naming U.S. producer ***,

3 naming importer ***, and 3 naming importer ***.

Sales Terms and Discounts

U.S. producers and importers of SDGE from China were asked what shares of their sales were on

a (1) long-term contract basis (multiple deliveries for more than 12 months), (2) short-term contract basis,

and (3) spot sales basis (for a single delivery) during 2007. Among producers, *** reported that they sell

***.9

 Among the eight responding importers that reported sales of imports from China, five reported that

a vast majority (greater than 90 percent) of their sales are on a short-term contract basis, two reported a

mixture of short-term contracts and spot sales, and one reported that a majority of its sales are on a longterm contract basis. 

For U.S. producers selling on a contract basis, ***. These producer contracts usually *** a meetor-release provision. In the case of importers, short-term contracts can range from periods as short as

three months to one year. Prices and quantities are both typically fixed during the contract period. These

importer contracts typically do not contain meet-or-release provisions.

Discount policies on sales of SDGE vary widely. ***. Among importers, three importers

reported that they may apply discounts based on early payment or volume.
 10 Pricing data were requested on both an f.o.b. and delivered basis; the delivered prices are presented here, as

producers and importers reported that *** sales are made on a delivered basis. Pricing data were also requested

separately for sales to distributors and sales to end users. *** of reported sales were to end users. U.S. producers’

reported sales quantities to distributors accounted for *** percent of their total reported quantity of sales of pricing

products. Among the five products, U.S.-produced product 1 had ***, accounting for *** percent of the total

quantity of reported sales of that product. However, U.S.-produced product 1 also had *** as reported by U.S.

producers. The price trends of sales to the two channels for U.S.-produced products 1-5 were ***, although U.S.

producers’ reported prices to end users were generally *** reported prices to distributors. *** percent of the

reported sales of pricing products 1-5 imported from China were to end users. If only sales prices to end users are

considered, the underselling/overselling analysis presented here does not change significantly. See discussion of

margins of underselling later in Part V.

 11 Pricing data reported by importers of imports from nonsubject sources are presented in appendix E.

V-4

PRICE DATA

The Commission requested U.S. producers and importers of SDGE from China to provide

quarterly data for the total quantity and delivered values of selected products that were shipped to

unrelated customers in the U.S. market.10 Data were requested for the period January 2005-September

2008. The products for which pricing data were requested are as follows:

Product 1.—HP graphite electrodes, 250 mm. (10 inches) nominal diameter x 1,800 mm.

(72 inches) nominal length, 3 TPI taper connecting pin.

Product 2.— HP graphite electrodes, 300 mm. (12 inches) nominal diameter x 1,800 mm.

(72 inches) nominal length, 3 TPI taper connecting pin.

Product 3.— UHP graphite electrodes, 250 mm. (10 inches) nominal diameter x 1,800 mm.

(72 inches) nominal length, 3 TPI taper connecting pin.

Product 4.— UHP graphite electrodes, 350 mm. (14 inches) nominal diameter x 1,800 mm.

(72 inches) nominal length, 3 TPI taper connecting pin.

Product 5.-- UHP graphite electrodes, 400 mm. (16 inches) nominal diameter x 1,800 mm.

(72 inches) nominal length, 3 TPI taper connecting pin.

Both U.S. producers and seven importers of SDGE from China provided pricing data for sales of

the requested products, although not all firms reported pricing for all products for all quarters.11 Pricing

data reported by these firms accounted for approximately *** percent of U.S. producers’ U.S. commercial

shipments of SDGE during January 2005-September 2008 and *** percent of U.S. shipments of imports

from China over the same period.

Price Trends

When purchasers were asked if prices for SDGE had generally increased, decreased, or stayed the

same since January 2005, 30 of 33 responding purchasers reported that prices had increased. Most

purchasers attributed rising prices of SDGE to increased costs for raw materials (especially needle coke)

and energy, while four purchasers cited availability shortages, four purchasers cited the preliminary duties

resulting from this investigation, three cited the depreciation of the U.S. dollar relative to many currencies

over the period of investigation, and three purchasers cited rising labor costs. Petitioners reported that the
 12 Hearing transcript, p. 100 (Kerwin) and p. 101 (Gore, Stinson).

 13 ***. See discussion of margins of underselling later in Part V.

 14 Hearing transcript, p. 15 (Stinson) and p. 98 (Kerwin).

V-5

market price for SDGE increased, especially in 2006, due to rising raw material costs and increased

demand.12

Weighted-average delivered prices reported by U.S. producers and importers are presented in

tables V-1 through V-5 and in figures V-3 through V-7 on a quarterly basis during January 2005-

September 2008. ***.13 Petitioner reported that Superior only produces SDGE and has continued to offer

a full product range and has had little option but to meet competitive pricing offered by import sources of

SDGE from China, whereas SGL has narrowed its product range to the 14- and 16-inch sizes of SDGE

where there has historically been less competition from the imports from China relative to the smaller

sizes, thereby choosing to sacrifice volume while attempting to maintain prices on its remaining product

range.14

For sales reported by U.S. producers, product *** accounted for the plurality of sales

(*** percent of the total quantity reported by U.S. producers for all pricing products), product ***

accounted for *** percent, product *** accounted for *** percent, product *** accounted for

*** percent, and product *** accounted for *** percent. For sales of products imported from China,

product *** accounted for the plurality of sales (*** percent of the total quantity reported by importers

for all pricing products), product *** accounted for *** percent, product *** accounted for *** percent,

product *** accounted for *** percent, and product *** accounted for *** percent.

The weighted-average sales price of U.S.-produced product 1 as reported by *** increased by

*** percent from the first quarter of 2005 to the third quarter of 2008, with most of the increases

occurring ***. The weighted-average sales price of product 1 imported from China as reported by

importers *** increased by *** percent over the same period, with most of the increase occurring ***.

The weighted-average sales price of U.S.-produced product 2 as reported by *** increased by

*** percent from the first quarter of 2005 to the third quarter of 2008, with most of the increase occurring

from the ***. The weighted-average sales price of product 2 imported from China as reported by

importers *** increased by *** percent over the same period, with most of the increase occurring in ***.

The weighted-average sales price of U.S.-produced product 3 as reported by *** increased by

*** percent from the first quarter of 2005 to the third quarter of 2008. The weighted-average sales price

of product 3 imported from China as reported by importers *** increased by *** percent from ***.

The weighted-average sales price of U.S.-produced product 4 as reported by *** increased by

*** percent from the first quarter of 2005 to the third quarter of 2008. The weighted-average sales price

of product 4 imported from China as reported by importers *** increased by *** percent over the same

period.

The weighted-average sales price of U.S.-produced product 5 as reported by *** increased by

*** percent from the first quarter of 2005 to the third quarter of 2008. The weighted-average sales price

of product 5 imported from China as reported by importers *** increased by *** percent from the second

quarter of 2005 to the third quarter of 2008.
V-6

Table V-1

SDGE: Weighted-average delivered prices and quantities of domestic and imported product 1 and

margins of underselling/(overselling), by quarters, January 2005-September 2008

* * * * * * *

Figure V-3

SDGE: Weighted-average delivered prices and quantities of domestic and imported product 1, by

quarters, January 2005-September 2008

* * * * * * *

Table V-2

SDGE: Weighted-average delivered prices and quantities of domestic and imported product 2 and

margins of underselling/(overselling), by quarters, January 2005-September 2008

* * * * * * *

Figure V-4

SDGE: Weighted-average delivered prices and quantities of domestic and imported product 2, by

quarters, January 2005-September 2008

* * * * * * *

Table V-3

SDGE: Weighted-average delivered prices and quantities of domestic and imported product 3 and

margins of underselling/(overselling), by quarters, January 2005-September 2008

* * * * * * *

Figure V-5

SDGE: Weighted-average delivered prices and quantities of domestic and imported product 3, by

quarters, January 2005-September 2008

* * * * * * *

Table V-4

SDGE: Weighted-average delivered prices and quantities of domestic and imported product 4 and

margins of underselling/(overselling), by quarters, January 2005-September 2008

* * * * * * *

Figure V-6

SDGE: Weighted-average delivered prices and quantities of domestic and imported product 4, by

quarters, January 2005-September 2008

* * * * * * *
 15 If only sales to end users are considered, there would be fewer quarterly comparisons, but the analysis would

not change significantly. There would be *** instances of underselling out of *** quarterly comparisons, with

margins ranging from *** percent to *** percent, and *** instances of overselling, with margins ranging from ***

percent to *** percent. ***.

 16 ***.

 17 *** of the purchasers cited by *** (***) are also cited in lost sales allegations reported by ***.

V-7

Table V-5

SDGE: Weighted-average delivered prices and quantities of domestic and imported product 5 and

margins of underselling/(overselling), by quarters, January 2005-September 2008

* * * * * * *

Figure V-7

SDGE: Weighted-average delivered prices and quantities of domestic and imported product 5, by

quarters, January 2005-September 2008

* * * * * * *

Price Comparisons

Margins of underselling and overselling for the period are presented by product category in tables

V-6 and V-7 below. The data show that prices of imports from China were lower than the U.S. producer

prices in 54 of 60 quarterly comparisons of products 1-5, by margins ranging from 2.3 percent to

36.2 percent.15 There were six instances of overselling, by margins ranging from 0.1 to 17.4 percent.

Table V-6

SDGE: Margins of underselling/(overselling) by product, quarterly, January 2005-September 2008

* * * * * * *

Table V-7

SDGE: Instances of underselling/overselling and the range and average of margins for products

1-5, January 2005-September 2008

* * * * * * *

LOST SALES AND LOST REVENUES

The Commission requested U.S. producers of SDGE to report any instances of lost sales or

revenues they experienced due to competition from imports of SDGE from China since January 2004. 

U.S. producer *** reported that it had to either reduce prices or roll back announced price increases and

provided *** lost sales allegations totaling $***. Staff contacted the *** purchasers cited in the

allegations; *** responded, *** of which confirmed *** allegations, valued at a total of $***.16 The

results are summarized in table V-8 and are discussed below. U.S. producer *** did not report specific

lost sales allegations; rather, it reported that there are *** purchasers that ***.17
V-8

Table V-8

SDGE: U.S. producers’ lost sales allegations

* * * * * * *
 1

 The U.S. producers of SDGE are Superior Graphite and SGL Carbon. In addition, three U.S. producers reported

operations on LDGE. These U.S. producers are C/G Electrodes, SGL Carbon, and Showa Denko. All U.S.

producers of SDGE and LDGE reported a fiscal year end of December 31. Income-and-loss data for U.S. producers

of LDGE are presented in table C-2, while income-and-loss data for the combined operations of U.S. producers of

SDGE and LDGE are presented in table C-3.

 2

 The company records underlying the trade and financial data for *** were reviewed at Commission offices. 

Adjustments resulting from the office review were incorporated in this final report. ***. 

 3

 Despite the improvement in 2007 as compared to 2005, per-unit operating income declined in 2007 as compared

to 2006. From 2006 to 2007, per-unit net sales values increased by $***, while per-unit operating costs and

expenses increased by $***. 

 4

 *** the reported financial results for SDGE operations, operations on LDGE are ***, with operating margins

ranging from *** to *** percent during the period for which data were collected. Petitioners state that the *** for

the two products is due to unfair competition from imports of SDGE from China, and that per-unit prices for SDGE

(continued...)

VI-1

PART VI: FINANCIAL CONDITION OF U.S. PRODUCERS

BACKGROUND

Two U.S. producers of SDGE provided usable financial data on their operations on SDGE.1 2

These data are believed to account for all U.S. production of SDGE in 2007. *** reported *** on its

SDGE operations; however, the reported amounts account for a weighted average of *** percent of total

net sales (quantity and value) during the period for which data were requested and are not shown

separately in this section of the report.

OPERATIONS ON SDGE

Income-and-loss data for U.S. producers of SDGE are presented in table VI-1. Selected

company-specific financial data are presented in table VI-2. The reported aggregate net sales quantities

steadily declined from 2005 to 2007, while aggregate net sales values increased irregularly during this

time frame. During the interim periods, net sales values increased at a greater rate than net sales

quantities. As a result of these movements, per-unit revenues steadily increased from 2005 to 2007, as

well as between the interim periods. Operating income improved from *** in 2005 to *** in both 2006

and 2007; however, operating income declined from 2006 to 2007. Between the interim periods,

operating income *** improved from *** to the *** during the period for which data were collected.

Table VI-1

SDGE: Results of operations of U.S. producers, 2005-07, January-September 2007, and JanuarySeptember 2008

* * * * * * *

For U.S. producers of SDGE, per-unit net sales values increased by $*** from 2005 to 2007,

while combined per-unit cost of goods sold (“COGS”) and selling, general, and administrative (“SG&A”)

expenses increased by $*** during this time frame, which led to improved operating income in 2007 as

compared to 2005, ***.3

 Between the interim periods, per-unit net sales values increased by $***, while

per-unit operating costs and expenses increased by $***, which resulted in *** from *** in interim 2007

to *** during the period for which data were collected.4
 4

(...continued)

and LDGE were comparable 10 to 12 years ago before the imports from China began to have a significant impact on

the U.S. market. Petitioners’ postconference brief, exh. 1, p. 6. 

 5

 ***. 

 6

 Petitioners’ postconference brief, exh. 1, pp. 4-6, and ***.

 7

 Respondents argue that the notable difference in profitability between the two petitioners reflects Superior

Graphite’s failure to upgrade its facility to enable the company to produce both LDGE and SDGE, and thus produce

at greater volumes and at greater efficiency. Further, respondents argue that ***. Respondents’ prehearing brief, pp.

39-42.

VI-2

While all components of COGS and SG&A expenses generally increased on a per-unit basis

during the period for which data were collected, the most significant per-unit increases occurred in ***

and ***, which increased by $*** and $***, respectively, from 2005 to 2007. Between the interim

periods, per-unit raw material costs continued to increase by $***, while per-unit other factory costs

declined by $*** due in part to improved production levels.

Table VI-2

SDGE: Selected results of operations of U.S. producers, by firm, 2005-07, January-September

2007, and January-September 2008

* * * * * * *

While the aggregate data on SDGE operations reveal an industry that was ***, individual firm

data reveal that *** on its SDGE operations. In terms of per-unit revenue, ***.5

 ***. ***.6 7

A variance analysis for the operations of U.S. producers of SDGE is presented in table VI-3. The

information for this variance analysis is derived from table VI-1. The variance analysis provides an

assessment of changes in profitability as it relates to changes in pricing, cost, and volume. The analysis

shows that the improvement in the operating income from 2005 to 2007, as well as between the interim

periods, was attributable to the favorable price variance which was higher than the unfavorable net

cost/expense variance (i.e., prices increased more than costs and expenses).

Table VI-3

SDGE: Variance analysis on the operations of U.S. producers, 2005-07, and January-September

2007 to January-September 2008

* * * * * * *

CAPITAL EXPENDITURES AND RESEARCH AND DEVELOPMENT EXPENSES

Capital expenditures and research and development (“R&D”) expenses are shown in table VI-4. 

Both SGL Carbon and Superior Graphite reported capital expenditures and R&D expenses. Between the

two firms, *** accounted for *** percent of capital expenditures from 2005 to 2007; however, during the

interim periods *** accounted for *** percent of capital expenditures. In all periods, *** accounted for

*** of R&D expenses. According to ***, its capital expenditures primarily reflect ***, while its R&D
 8

 ***.

 9

 ***.

 10 Superior Graphite stated at the hearing that its recent profitability has been too low to justify any significant

investment in improvements to production equipment, thus capital investment has largely been limited to the

maintenance of existing equipment. Hearing transcript, p. 31 (Carney). In contrast, respondents argued that any

material injury that Superior Graphite claims to have suffered is self-inflicted because the company has failed to

modernize its equipment and has limited its production to the less profitable smaller electrodes. Hearing transcript,

p. 260 (Brashem).

VI-3

expenses primarily reflect ***.8

 ***’s capital expenditures primarily reflect ***. In addition, ***’s R&D

expenses primarily reflect ***.9 10 With the exception of the interim periods, ***. 

Table VI-4

SDGE: Capital expenditures and research and development expenses of U.S. producers, 2005-07,

January-September 2007, and January-September 2008

* * * * * * *

ASSETS AND RETURN ON INVESTMENT

Data on the U.S. producers’ total assets and their return on investment (“ROI”) are presented in

table VI-5. For U.S. producers of SDGE, the total assets utilized in the production, warehousing, and sale

of such products increased from 2005 to 2007, with an increase from $*** in 2005 to $*** in 2007. The

ROI increased irregularly during the period for which data were collected, increasing by *** percentage

points from 2005 to 2006, which brought the ROI ***, before decreasing by *** percentage points from

2006 to 2007. The trend in the ROI was similar to the trend in operating income.

Table VI-5

SDGE: U.S. producers’ total assets and return on investment, fiscal years 2005-07

* * * * * * *

CAPITAL AND INVESTMENT

The Commission requested U.S. producers of SDGE and U.S. producers of LDGE to describe

any actual or potential negative effects of imports of SDGE from China on their firms’ growth,

investment, ability to raise capital, development and production efforts, or the scale of capital

investments. Their responses are shown in appendix F.
 
 1 Small Diameter Graphite Electrodes from the People’s Republic of China: Amended Preliminary

Determination of Sales at Less Than Fair Value, 73 FR 54561, September 22, 2008.

 2

 Petition, Exhibit General-3 and internet searches.

 3

 Two firms that responded in the preliminary phase of the investigation did not respond in the final. Information

compiled by the China Carbon Industry Association indicates that 47 companies in China produce graphite

electrodes (small and/or large diameter); those companies reportedly account for over 95 percent of graphite

electrode production in China. In interim 2008, only 25 of these companies reportedly exported graphite electrodes,

of which only 20 exported to the United States. Of these 20 companies, only 10 exported quantities in excess of 200

tons to the United States. Respondents’ posthearing brief, p. 19.

 4

 The coverage share is based on a summary of estimates provided by ten producing firms and three exporting

firms in response to the Commission’s questionnaire. Chinese producers’ questionnaire responses, section II-10, fn.

4 and 5. 

 5

 ***, which estimated that it accounted for *** percent and *** percent of total Chinese production and exports

to the United States, reported that ***. It reported that ***. ***, which estimated that it accounted for *** percent

and *** percent of total Chinese production and exports to the United States, reported that ***. *** which estimated

that it accounted for *** percent and *** percent of total Chinese production and exports to the United States,

reported that ***.

VII-1

PART VII: THREAT CONSIDERATIONS AND INFORMATION ON

NONSUBJECT COUNTRIES

The Commission analyzes a number of factors in making threat determinations (see 19 U.S.C. §

1677(7)(F)(i). Information on the volume and pricing of imports of the subject merchandise is presented

in Parts IV and V; and information on the effects of imports of the subject merchandise on U.S.

producers’ existing development and production efforts is presented in appendix F. Information on

inventories of the subject merchandise; foreign producers’ operations, including the potential for

“product-shifting;” any other threat indicators, if applicable; and any dumping in third-country markets,

follows. Also presented in this section of the report is information obtained for consideration by the

Commission on nonsubject countries and the global market.

THE INDUSTRY IN CHINA

The Commission sent foreign producer/exporter questionnaires to 125 firms identified in the

petition and Commerce’s notice1

 as producers or exporters of SDGE in China, for which contact

information was publicly available.2

 Thirteen firms provided responses to the Commission’s

questionnaires.3

 The names of the foreign firms along with shares of production and subject exports to

the United States (by quantity) are presented in table VII-1. The responding firms reported that they

accounted for an estimated nearly *** percent of production of SDGE in China during 2007, and nearly

*** percent of exports from China to the United States of SDGE during 2007.4

 The Commission asked

these foreign firms to estimate the shares of their firm’s total sales that were represented by sales of

SDGE in 2007; firms’ estimates ranged from 14 percent to 100 percent of total sales. In response to a

question on capacity changes, three Chinese producers reported plans to change production capacity or

production of SDGE in China.5

Table VII-1

SDGE: Reporting manufacturers/exporters in China, and quantities and shares of reported

production and exports to the United States, 2007

* * * * * * *
 6

 U.S. importers’ questionnaire responses, section II-3.

VII-2

Table VII-2 presents information on Chinese producers’ SDGE operations as compiled from

responses to the Commission’s questionnaires. Chinese capacity rose by nearly *** percent from 2005 to

2007 and is projected to decline by about *** percent by 2009. Exports to the United States rose

*** percent from 2005 to 2007, compared with an increase of *** percent to all other markets. 

Table VII-3 presents data on Chinese producers’ production and exports of SDGE, by size.

Table VII-2

SDGE: China’s reported capacity, production, inventories, and shipments, 2005-07, JanuarySeptember 2007, January-September 2008, and projections for 2008 and 2009

* * * * * * *

Table VII-3

Graphite electrodes: Chinese producers’ production and exports, by size, 2005-07, JanuarySeptember 2007, and January-September 2008

* * * * * * *

U.S. IMPORTERS’ INVENTORIES

Data collected in this investigation on U.S. importers’ end-of-period inventories of SDGE are

presented in table VII-4. 

Table VII-4

SDGE: U.S. importers’ end-of-period inventories of imports, by source, 2005-07, JanuarySeptember 2007, and January-September 2008

* * * * * * *

U.S. IMPORTERS’ CURRENT ORDERS

The Commission requested importers to indicate whether they imported or arranged for the

importation of SDGE from China after September 30, 2008. Six firms reported having arranged for the

importation of SDGE from China.6

 Table VII-5 presents U.S. importers’ orders of SDGE from China for

October 2008 through September 2009.

Table VII-5

SDGE: U.S. importers’ current orders from China subsequent to September 2008

* * * * * * *
 7 Annual Report 2005-2006, Directorate General of Anti-dumping & Allied Duties, Ministry of Commerce &

Industry, Government of India. 

 8

 No antidumping duties were imposed on the following producer/exporter combinations: (1) Chengdu

Rongguang Carbon Co. Ltd./Liaoning Jiayi Metals & Minerals Co. Ltd. and (2) Liaoyang Carbon Co. Ltd. of

China/Liaoning Jiayi Metals & Minerals Co. Ltd.

 9 Mittal Steel Point Lisas Ltd. v. United States, Slip Op. 2007-1552 at 17 (Fed. Cir., Sept. 18, 2008), quoting from

Statement of Administrative Action on Uruguay Round Agreements Act, H.R. Rep. 103-316, Vol. I at 851-52; see

also Bratsk Aluminum Smelter v. United States, 444 F.3d 1369 (Fed. Cir. 2006).

 10 Data on U.S. imports from sources other than China and Mexico are based on estimates provided in the

petition. Petition Injury Exh. 2.

 11 These four countries, Canada, and Germany accounted for the vast majority of total U.S. imports as reported in

official Commerce import statistics, which include nonsubject electrodes.

 12 Conference transcript, pp. 52-53 (Stinson).

VII-3

ANTIDUMPING INVESTIGATIONS IN THIRD-COUNTRY MARKETS

The government of India has conducted one antidumping duty investigation on imports of

graphite electrodes (a product with a definition broader than SDGE). India imposed antidumping duty

orders on graphite electrodes from Austria, Belgium, China, France, Germany, Italy, Spain, and the

United States in May 1998.7

 In July 2003, a continuation notice of the antidumping duty order on imports

from China was issued.8

 Antidumping duties were removed in July 2003 from all other countries covered

by the original orders.

*** in July 2008 an antidumping duty investigation commenced in Brazil on imports of graphite

electrodes from China. Importer *** also mentioned an investigation in Brazil.

INFORMATION ON NONSUBJECT COUNTRIES

In assessing whether the domestic industry is materially injured or threatened with material injury

“by reason of subject imports,” the legislative history states “that the Commission must examine all

relevant evidence, including any known factors, other than the dumped or subsidized imports, that may be

injuring the domestic industry, and that the Commission must examine those other factors *** ‘to ensure

that it is not attributing injury from other sources to the subject imports.’”9

Global Market

According to official import statistics from the U.S. Department of Commerce, U.S. imports of

electrodes provided for under HTS subheading 8545.11.00, a “basket” category, entered the United 

States from 23 countries other than China between 2005 and September 2008. According to data

collected in questionnaire responses and adjusted official Commerce import statistics,10 imports from four

countries (China, Mexico, Russia, and Japan) accounted for *** percent of total imports of SDGE 

by quantity and *** percent by value during the period for which data were collected.11 Detailed

production data for SDGE produced in most nonsubject countries are not readily available. Trade data,

however, suggest that Japan, Spain, China, Germany, France, and India are major net exporters of

graphite electrodes, either SDGE or LDGE.

Major multinational producers of graphite electrodes such as SGL Carbon AG, GrafTech

International, Showa Denko K.K., and Tokai Carbon maintain company operations in North America,

Europe, Asia, and Japan. The United States and Japan produce needle coke, a critical raw material

component in the production of graphite electrodes, both SDGE and LDGE.12 Needle coke production is
VII-4

critical for the success of electrode performance and reportedly limits the ability of manufacturers in other

countries to make higher grades and sizes of graphite electrodes.

The export, import, and trade balance data presented in table VII-6 are derived from Global Trade

Atlas for 6-digit HTS subheading 8545.11, and include nonsubject products. Table VII-7 presents

adjusted imports for 2005-07.
VII-5

Table VII-6

Carbon and graphite electrodes: Net trade positions of major subject and nonsubject countries,

2004-07

Country Calendar year

2004 2005 2006 2007

Value ($1,000)

 Imports into:

Japan 18,012 22,397 20,275 22,913

Spain 38,522 50,540 50,336 73,978

Germany 45,018 63,033 72,466 93,366

China 46,407 56,034 56,273 79,038

France 42,487 48,211 61,925 82,380

India 13,726 20,589 38,109 42,667

Italy 63,886 73,511 90,425 119,903

United States 144,371 157,298 208,492 256,870

Russia 16,949 40,286 90,050 141,667

Mexico 37,119 41,786 49,633 73,143

All others 837,143 942,066 1,066,246 1,433,921

Total 1,303,641 1,515,749 1,804,227 2,419,844

Exports from:

Japan 287,003 348,953 435,355 546,431

Spain 148,119 180,949 244,012 346,048

Germany 174,349 211,557 245,779 336,987

China 148,822 193,933 204,786 328,589

France 100,337 86,776 114,098 151,327

India 53,061 81,344 120,829 143,272

Italy 90,511 94,275 75,258 137,244

United States 56,795 77,673 100,100 122,528

Russia 50,104 53,662 64,646 95,084

Mexico 63,167 58,433 71,444 70,657

All others 227,948 262,901 338,153 407,327

Total 1,400,215 1,650,456 2,014,460 2,685,493

Trade balance of:1

Japan 268,991 326,555 415,080 523,519

Spain 109,596 130,410 193,677 272,070

Germany 129,331 148,524 173,313 243,621

China 102,415 137,900 148,513 249,551

France 57,849 38,565 52,173 68,947

India 39,335 60,755 82,720 100,606

Italy 26,626 20,764 (15,167) 17,341

United States (87,577) (79,624) (108,392) (134,342)

Russia 33,155 13,376 (25,403) (46,583)

Mexico 26,049 16,648 21,811 (2,485)

All others (609,195) (679,165) (728,093) (1,026,594)

Total 96,574 134,707 210,233 265,649

1

 Positive numbers presented for “trade balance” show net exports and numbers in parentheses presented for “trade balance”

show net imports. Based on top ten exporting countries to the world in 2007.

Source: Compiled from the Global Trade Atlas database, HTS subheading 8545.11.
 13 ***.

 14 Data Monitor, “Company Profile: GrafTech International Ltd.,” August 23, 2007, p. 15.

VII-6

Table VII-7

SDGE: U.S. imports, by sources, 2005-07

Country

Calendar year

2005 2006 2007

Quantity (metric tons)

China 10,082 13,161 13,784

Mexico *** *** ***

Russia 463 2,263 4,835

Japan 1,258 1,454 1,795

India 68 1,845 817

Germany 186 393 190

Poland 33 138 165

Brazil 1,346 385 142

All Other 404 2,427 1,635

Total *** *** ***

Value ($1,000)

China 15,819 21,638 24,003

Mexico *** *** ***

Russia 598 2,540 5,857

Japan 4,017 5,760 8,559

India 179 4,347 2,093

Germany 999 1,276 1,199

Poland 47 208 309

Brazil 2,869 652 486

All Other 878 2,397 2,134

Total *** *** ***

Note.--Both quantity and value are adjusted using the following formula: 60 percent of official imports from India;

10 percent from Germany, Japan, Poland, and Spain; 0 percent from Canada; and 50 percent from all other

sources (other than China and Mexico which are questionnaire driven). Because of the methodology by which

official Commerce statistics were adjusted, value data for countries other than China and Mexico may be

overstated to the extent that the unit values of SDGE are lower than the unit values of other products imported

under the same HTS subheading.

Source: Compiled from data submitted in response to Commission questionnaires and from adjusted official 

Commerce statistics.

Mexico

GrafTech Mexico S.A. de C.V. (also known as UCAR Carbon Mexicana S.A.) is the sole known

producer of SDGE and LDGE in Mexico.13 GrafTech’s production facility in Monterrey, Mexico is the

largest graphite electrode manufacturing plant in the world.14 Table VII-8 presents information on

GrafTech’s SDGE operations and table VII-9 presents data for its production and exports of graphite

electrodes as compiled from its response to the Commission’s questionnaire.
 15 GrafTech International 2007 SEC 10-Q filing, found at http://www.esignal.brand.edgar-online.com, retrieved

on February 9, 2008.

 16 Email from ***, February 20, 2008.

 17 Staff telephone interview with ***, on November 20, 2008.

 18 SGL Group, Graphite Electrodes. 

http://www.sglgroup.com/export/sites/sglcarbon/_common/downloads/products/product-groups/gce/graphiteelectrodes/graphit_e.pdf (accessed November 19, 2008).

 19 ***’s importer’s questionnaire, section I-5.

 20 ERFTCARBON Company Website: http://www.erftcarbon.com (accessed November 19, 2008); and Graphite

COVA Company Website: http://www.graphitecova.com (accessed November 19, 2008).

VII-7

Table VII-8

SDGE: GrafTech’s (Mexico) reported capacity, production, inventories, and shipments, 2005-07,

January-September 2007, January-September 2008, and projections for 2008 and 2009

* * * * * * *

Table VII-9

Graphite electrodes: GrafTech’s (Mexico) production and exports, by size, 2005-07, JanuarySeptember 2007, and January-September 2008

* * * * * * *

Brazil

GrafTech International (also known as UCAR Carbon S.A.) is one of the world’s largest

manufacturers of graphite electrodes, and has a facility in Salvador, Brazil. GrafTec International of

Brazil maintains a state-of-the-art manufacturing facility producing both SDGEs and LDGEs.15 While

GrafTech ***.16

Canada

SGL Canada is the sole graphite electrode producer in Canada. The SGL facility in Canada ***. 

SGL Canada largely produces ***. ***.17

Germany

Several of the major producers of graphite electrodes have production locations in Germany. 

SGL Carbon Group’s headquarters are in Germany and it has two production sites in Germany.18 ***.19

In addition to SGL, ERFTCARBON, a subsidiary of Tokai Carbon, produces LDGE in Germany and

Graphite COVA, a subsidiary of Graphite India, produces SDGE and LDGE.20

India

The two major producers of graphite electrodes in India are Graphite India Ltd. and HEG India

Ltd. (a subsidiary of the LNJ Bhilwara Group), both of which produce SDGE and LDGE. Graphite India

and HEG each have a current domestic production capacity of about 60,000 metric tons and are in the

process of further expanding their production capacity. EAF use among Indian steel producers is low, so

the primary markets for their products are overseas. Graphite India exports about 65 to 70 percent of the
 21 Graphite India Limited, Annual Report 2007-08, p. 9: 

http://www.graphiteindia.com/images/annualreport/pdf2008/ar1-84.pdf (accessed November 9, 2008); Graphite

India Limited Website: http://www.graphiteindia.com (accessed November 14, 2008); “Graphite India Sales Top Rs

1000cr Mark, Net up 37%,” The Financial Express, May 13, 2008: http://www.financialexpress.com (accessed

November 14, 2008); HEG Limited Website: http://www.hegltd.com (accessed November 14, 2008); “Profit Call,”

Outlook Profit, October 31, 2008: http://www.hegltd.com/newsDetail.aspx?NewsId=4 (accessed November 21,

2008); and Srividhya Sivakumar, “Graphite India: Buy,” The Hindu Business Line, April 6, 2008: 

http://www.thehindubusinessline.com (accessed April 6, 2008).

 22 GrafTech International, 2007 Annual Report, 16: http://www.graftech.com/ (accessed November 24, 2008).

 23 Tokai Carbon Company Website: http://www.tokaicarbon.co.jp/en/ (accessed November 24, 2008).

 24 Tokai Carbon Company, Annual Report 2007, 2: http://www.tokaicarbon.co.jp/en/ (accessed November 24,

2008).

 25 ***’s Importer’s Questionnaire at II-5b, II-8a, and II-8b; and ***’s Producer’s Questionnaire at II-15.

 26 Mitsubishi Corp., “Profile Carbon Materials Unit,” found at

http://www.mitsubishicorp.com/en/bg/ucmaterials.html, February 13, 2008.

 27 Energoprom Co., Company profile, found at http://www.energoprom.kiev.ua, retrieved on February 9, 2008.

 28 U.S. Securities and Exchange Commission, “Synthetic Graphite Segment,” GrafTech’s 2007 10-Q filing, p. 12,

and Data Monitor, “Company Profile: GrafTech International Ltd,” DataMonitor, p. 23, found at

http://www.datamonitor.com, retrieved on August 23, 2007.

VII-8

graphite electrodes that it produces and HEG exports about 80 percent, though Graphite India expects

domestic demand to increase. Graphite India also has a Coke Division which can produce calcined

petroleum coke that is used in the manufacturing of graphite electrodes.21

Japan

Tokai Carbon Co. and Showa Denko KK are two of the five known multinational manufacturers

of graphite electrodes in Japan.22 Tokai Carbon produces small (14-16 inches) and large diameter (18 to

32 inches) electrodes.23 Its domestic plants operated at full capacity in 2007.24 ***.25 Other Japanese

producers of graphite electrodes include Nippon Carbon Co. and SEC Carbon. Mitsubishi Carbon

represents approximately 40 percent of Japan’s exports of graphite electrodes for steelmaking.26

Russia

Energoprom is the leading supplier of graphite electrodes and graphite products in Russia.

Energoprom reportedly was the largest producer of LDGE in Russia during 2006.27 Information on its

recent production of SDGE is not publicly available. According to GrafTec International, formerly

known as UCAR Grafit OAO in Russia, its production facility of graphite and carbon electrodes closed in

2007.28
A-1

APPENDIX A

FEDERAL REGISTER NOTICES

Federal Register / Vol. 73, No. 172 / Thursday, September 4, 2008 / Notices 51647 

1For purposes of this investigation, the 

Department of Commerce has defined the subject 

merchandise as ‘‘all small diameter graphite 

electrodes of any length, whether or not finished, 

of a kind used in furnaces, with a nominal or actual 

diameter of 400 millimeters (16 inches) or less, and 

whether or not attached to a graphite pin joining 

system or any other type of joining system or 

hardware. Small diameter graphite electrodes are 

most commonly used in primary melting, ladle 

metallurgy, and specialty furnace applications in 

industries including foundries, smelters, and steel 

refining operations.’’

with the exception of certain 

modifications and clarifications. The 

BLM received six protests to the 

Proposed RMP/Final EIS. Four of those 

who submitted protests were 

determined to have standing and the 

BLM Director resolved the protests 

without requiring significant changes to 

decisions in the Proposed RMP/Final 

EIS. The modifications and 

clarifications to the proposed plan are 

outlined in the ROD. 

No inconsistencies with State or local 

plans, policies, or programs were 

identified during the Governor’s 

consistency review of the Proposed 

RMP/Final EIS. 

The ROD and Approved RMP include 

a decision requiring air taxi operators 

and transporters to obtain commercial 

permits to operate in the Squirrel River 

Special Recreation Management Area. 

This decision is found in section III.D. 

Implementation Decisions of the ROD. 

This is an implementation-level 

decision appealable to the Interior 

Board of Land Appeals (IBLA) under 43 

CFR Part 4. Any party adversely affected 

by this decision may appeal within 30 

days of publication of this Notice of 

Availability pursuant to 43 CFR Part 4, 

Subpart E. Please consult the 

appropriate regulations for further 

information on the appeal requirements. 

Authority: H–1790–1 National 

Environmental Policy Act Handbook—

January 30, 2008. 

Vincent Galterio, 

Acting State Director. 

[FR Doc. E8–20406 Filed 9–3–08; 8:45 am] 

BILLING CODE 4310–JA–P 

INTERNATIONAL TRADE 

COMMISSION 

[Investigation No. 731–TA–1143 (Final)] 

Small Diameter Graphite Electrodes 

From China 

AGENCY: United States International 

Trade Commission. 

ACTION: Scheduling of the final phase of 

an antidumping investigation. 

SUMMARY: The Commission hereby gives 

notice of the scheduling of the final 

phase of antidumping investigation No. 

731–TA–1143 (Final) under section 

735(b) of the Tariff Act of 1930 (19 

U.S.C. 1673d(b)) (the Act) to determine 

whether an industry in the United 

States is materially injured or 

threatened with material injury, or the 

establishment of an industry in the 

United States is materially retarded, by 

reason of less-than-fair-value imports 

from China of small diameter graphite 

electrodes, provided for in subheading 

8545.11.00 of the Harmonized Tariff 

Schedule of the United States.1

For further information concerning 

the conduct of this phase of the 

investigation, hearing procedures, and 

rules of general application, consult the 

Commission’s Rules of Practice and 

Procedure, part 201, subparts A through 

E (19 CFR part 201), and part 207, 

subparts A and C (19 CFR part 207). 

DATES: Effective Date: August 21, 2008. 

FOR FURTHER INFORMATION CONTACT: Fred 

Ruggles (202–205–3187 or 

fred.ruggles@usitc.gov), Office of 

Investigations, U.S. International Trade 

Commission, 500 E Street, SW., 

Washington, DC 20436. Hearingimpaired persons can obtain 

information on this matter by contacting 

the Commission’s TDD terminal on 202–

205–1810. Persons with mobility 

impairments who will need special 

assistance in gaining access to the 

Commission should contact the Office 

of the Secretary at 202–205–2000. 

General information concerning the 

Commission may also be obtained by 

accessing its internet server (http:// 

www.usitc.gov). The public record for 

this investigation may be viewed on the 

Commission’s electronic docket (EDIS) 

at http://edis.usitc.gov. 

SUPPLEMENTARY INFORMATION: 

Background.—The final phase of this 

investigation is being scheduled as a 

result of an affirmative preliminary 

determination by the Department of 

Commerce that imports of small 

diameter graphite electrodes from China 

are being sold in the United States at 

less than fair value within the meaning 

of section 733 of the Act (19 U.S.C. 

1673b). The investigation was requested 

in a petition filed on January 17, 2008, 

with the Commission and Commerce by 

SGL Carbon LLC, Charlotte, NC, and 

Superior Graphite Co., Chicago, IL. 

Participation in the investigation and 

public service list.—Persons, including 

industrial users of the subject 

merchandise and, if the merchandise is 

sold at the retail level, representative 

consumer organizations, wishing to 

participate in the final phase of this 

investigation as parties must file an 

entry of appearance with the Secretary 

to the Commission, as provided in 

section 201.11 of the Commission’s 

rules, no later than 21 days prior to the 

hearing date specified in this notice. A 

party that filed a notice of appearance 

during the preliminary phase of the 

investigation need not file an additional 

notice of appearance during this final 

phase. The Secretary will maintain a 

public service list containing the names 

and addresses of all persons, or their 

representatives, who are parties to the 

investigation. 

Limited disclosure of business 

proprietary information (BPI) under an 

administrative protective order (APO) 

and BPI service list.—Pursuant to 

section 207.7(a) of the Commission’s 

rules, the Secretary will make BPI 

gathered in the final phase of this 

investigation available to authorized 

applicants under the APO issued in the 

investigation, provided that the 

application is made no later than 21 

days prior to the hearing date specified 

in this notice. Authorized applicants 

must represent interested parties, as 

defined by 19 U.S.C. 1677(9), who are 

parties to the investigation. A party 

granted access to BPI in the preliminary 

phase of the investigation need not 

reapply for such access. A separate 

service list will be maintained by the 

Secretary for those parties authorized to 

receive BPI under the APO. 

Staff report.—The prehearing staff 

report in the final phase of this 

investigation will be placed in the 

nonpublic record on December 16, 2008, 

and a public version will be issued 

thereafter, pursuant to section 207.22 of 

the Commission’s rules. 

Hearing.—The Commission will hold 

a hearing in connection with the final 

phase of this investigation beginning at 

9:30 a.m. on January 6, 2009, at the U.S. 

International Trade Commission 

Building. Requests to appear at the 

hearing should be filed in writing with 

the Secretary to the Commission on or 

before December 23, 2008. A nonparty 

who has testimony that may aid the 

Commission’s deliberations may request 

permission to present a short statement 

at the hearing. All parties and 

nonparties desiring to appear at the 

hearing and make oral presentations 

should attend a prehearing conference 

to be held at 9:30 a.m. on December 30, 

2008, at the U.S. International Trade 

Commission Building. Oral testimony 

and written materials to be submitted at 

the public hearing are governed by 

sections 201.6(b)(2), 201.13(f), and 

207.24 of the Commission’s rules. 

Parties must submit any request to 

present a portion of their hearing 

testimony in camera no later than 7 


sroberts on PROD1PC77 with NOTICES
51648 Federal Register / Vol. 73, No. 172 / Thursday, September 4, 2008 / Notices 

business days prior to the date of the 

hearing. 

Written submissions.—Each party 

who is an interested party shall submit 

a prehearing brief to the Commission. 

Prehearing briefs must conform with the 

provisions of section 207.23 of the 

Commission’s rules; the deadline for 

filing is December 29, 2008. Parties may 

also file written testimony in connection 

with their presentation at the hearing, as 

provided in section 207.24 of the 

Commission’s rules, and posthearing 

briefs, which must conform with the 

provisions of section 207.25 of the 

Commission’s rules. The deadline for 

filing posthearing briefs is January 13, 

2009; witness testimony must be filed 

no later than three days before the 

hearing. In addition, any person who 

has not entered an appearance as a party 

to the investigation may submit a 

written statement of information 

pertinent to the subject of the 

investigation, including statements of 

support or opposition to the petition, on 

or before January 13, 2009. On January 

29, 2009, the Commission will make 

available to parties all information on 

which they have not had an opportunity 

to comment. Parties may submit final 

comments on this information on or 

before February 2, 2009, but such final 

comments must not contain new factual 

information and must otherwise comply 

with section 207.30 of the Commission’s 

rules. All written submissions must 

conform with the provisions of section 

201.8 of the Commission’s rules; any 

submissions that contain BPI must also 

conform with the requirements of 

sections 201.6, 207.3, and 207.7 of the 

Commission’s rules. The Commission’s 

rules do not authorize filing of 

submissions with the Secretary by 

facsimile or electronic means, except to 

the extent permitted by section 201.8 of 

the Commission’s rules, as amended, 67 

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). 

Additional written submissions to the 

Commission, including requests 

pursuant to section 201.12 of the 

Commission’s rules, shall not be 

accepted unless good cause is shown for 

accepting such submissions, or unless 

the submission is pursuant to a specific 

request by a Commissioner or 

Commission staff. 

In accordance with sections 201.16(c) 

and 207.3 of the Commission’s rules, 

each document filed by a party to the 

investigation must be served on all other 

parties to the investigation (as identified 

by either the public or BPI service list), 

and a certificate of service must be 

timely filed. The Secretary will not 

accept a document for filing without a 

certificate of service. 

Authority: This investigation is being 

conducted under authority of title VII of the 

Tariff Act of 1930; this notice is published 

pursuant to section 207.21 of the 

Commission’s rules. 

By order of the Commission. 

Issued: August 29, 2008. 

Marilyn R. Abbott, 

Secretary to the Commission. 

[FR Doc. E8–20496 Filed 9–3–08; 8:45 am] 

BILLING CODE 7020–02–P 

INTERNATIONAL TRADE 

COMMISSION 

[Investigation No. Australia FTA–103–021] 

Viscose Rayon Staple Fiber: Probable 

Effect of Modification of U.S.-Australia 

Free Trade Agreement Rules of Origin 

AGENCY: United States International 

Trade Commission. 

ACTION: Institution of investigation. 

SUMMARY: Following a request received 

August 14, 2008, from the Office of the 

United States Trade Representative 

(USTR) under authority delegated by the 

President and pursuant to section 104 of 

the United States-Australia Free Trade 

Agreement (USAFTA) Implementation 

Act, the U.S. International Trade 

Commission (Commission) instituted 

Investigation No. Australia FTA–103–

021, Viscose Rayon Staple Fiber: 

Probable Effect of Modification of U.S.- 

Australia Free Trade Agreement Rules 

of Origin. 

DATES: September 17, 2008: Deadline for 

filing all written statements. October 23, 

2008: Transmittal of Commission report 

to the Office of the United States Trade 

Representative. 

ADDRESSES: All Commission offices, 

including the Commission’s hearing 

rooms, are located in the United States 

International Trade Commission 

Building, 500 E Street, SW., 

Washington, DC. All written 

submissions should be addressed to the 

Secretary, United States International 

Trade Commission, 500 E Street, SW., 

Washington, DC 20436. The public 

record for this investigation may be 

viewed on the Commission’s electronic 

docket (EDIS) at http://www.usitc.gov/ 

secretary/edis.htm. 

FOR FURTHER INFORMATION CONTACT: 

Project Leaders Jackie Jones (202–205–

3466 or jackie.jones@usitc.gov) or Don 

Sussman (202–205–3331 or 

donald.sussman@usitc.gov) for 

information specific to this 

investigation. For information on the 

legal aspects of this investigation, 

contact William Gearhart of the 

Commission’s Office of the General 

Counsel (202–205–3091 or 

william.gearhart@usitc.gov). The media 

should contact Margaret O’Laughlin, 

Office of External Relations (202–205–

1819 or margaret.olaughlin@usitc.gov). 

Hearing-impaired individuals may 

obtain information on this matter by 

contacting the Commission’s TDD 

terminal at 202–205–1810. General 

information concerning the Commission 

may also be obtained by accessing its 

Internet server (http://www.usitc.gov). 

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. 

Background: Chapter 4 and Annex 4–

A of the USAFTA contain the rules of 

origin for textiles and apparel for 

application of the tariff provisions of the 

USAFTA. These rules are set forth for 

the United States in general note 28 to 

the Harmonized Tariff Schedule (HTS). 

According to the request letter, U.S. 

negotiators have recently reached 

agreement in principle with 

representatives of the Government of 

Australia to modify the USAFTA rules 

of origin for certain yarns because it has 

been determined that U.S. and 

Australian producers are not able to 

produce viscose rayon staple fiber in 

commercial quantities in a timely 

manner. Information supplied to the 

Commission indicates that the yarns 

affected include blends of viscose rayon 

staple fibers with synthetic fibers, e.g., 

polyester, and with other artificial 

fibers, e.g., acetate. Section 203(o) of the 

United States-Australia Free Trade 

Agreement Implementation Act (the 

Act) authorizes the President, subject to 

the consultation and layover 

requirements of section 104 of the Act, 

to proclaim such modifications to the 

rules of origin as are necessary to 

implement an agreement with Australia 

pursuant to Article 4.2.5 of the 

Agreement. One of the requirements set 

out in section 104 of the Act is that the 

President obtains advice regarding the 

proposed action from the United States 

International Trade Commission. 

The request letter asks that the 

Commission provide advice on the 

probable effect of the proposed 

modification of the USAFTA rules of 

origin noted above on U.S. trade under 

the USAFTA, on total U.S. trade, and on 

domestic producers of the affected 

articles. As requested, the Commission 

will submit its advice to USTR by 


sroberts on PROD1PC77 with NOTICES
Federal Register / Vol. 74, No. 9 / Wednesday, January 14, 2009 / Notices 2049 

1The petitioners in this investigation are SGL 

Carbon LLC and Superior Graphite Co. 

companies were assigned the same 

taxpayer identification numbers; 

(4) A statement from a Thai bank 

confirming the change of the company 

account name from AST to AMT in 

August 2006; 

(5) Company outlines dated before 

and after the name change that 

demonstrate no changes in management 

or facilities between the two points in 

time; 

(6) A notice published by the 

European Union Commission 

recognizing the name change from AST 

to AMT for antidumping-duty purposes; 

and 

(7) Copies of letters AST sent to 

customers announcing the name change. 

In summary, AMT has presented 

evidence to establish a prima facie case 

of its successorship status. AST’s name 

change to AMT has not changed the 

operations of the company in a 

meaningful way. AMT’s management, 

production facilities, supplier 

relationships, and customer base are 

substantially unchanged from those of 

AST. The record evidence demonstrates 

that the new entity essentially operates 

in the same manner as the predecessor 

company. Consequently, we 

preliminarily determine that AMT 

should be assigned the same 

antidumping-duty treatment as AST, 

i.e., exclusion from the order. See 

Antidumping Duty Order; Certain 

Carbon Steel Butt-Weld Pipe Fittings 

From Thailand, 57 FR 29702 (July 6, 

1992). 

Public Comment 

Interested parties are invited to 

comment on these preliminary results. 

Written comments may be submitted no 

later than 14 days after the date of 

publication of these preliminary results. 

Rebuttals to written comments, limited 

to issues raised in such comments, may 

be filed no later than 21 days after the 

date of publication. The Department 

will issue the final results of this 

changed-circumstances review, which 

will include the results of its analysis 

raised in any such written comments, 

no later than 270 days after the date on 

which this review was initiated or 

within 45 days if all parties agree to our 

preliminary results. See 19 CFR 

351.216(e). 

This notice is published in 

accordance with sections 751(b)(1) and 

777(i) of the Act and 19 CFR 351.216 

and 351.221. 

Ronald K. Lorentzen, 

Acting Assistant Secretary for Import 

Administration. 

[FR Doc. E9–632 Filed 1–13–09; 8:45 am] 

BILLING CODE 3510–DS–P 

DEPARTMENT OF COMMERCE 

International Trade Administration 

(A–552–801) 

Certain Frozen Fish Fillets from the 

Socialist Republic of Vietnam: 

Extension of Time Limit for Final 

Results of Changed Circumstances 

Review 

EFFECTIVE DATE: January 14, 2009. 

FOR FURTHER INFORMATION CONTACT: 

Javier Barrientos, AD/CVD Operations, 

Office 9, Import Administration, 

International Trade Administration, 

U.S. Department of Commerce, 14th 

Street and Constitution Avenue NW, 

Washington, DC 20230; telephone: (202) 

482–2243. 

Extension of Time Limit for Final 

Results 

On August 10, 2007, the Department 

of Commerce (‘‘Department’’) issued its 

preliminary results for the changed 

circumstances review of the 

antidumping duty order of certain 

frozen fish fillets from the Socialist 

Republic of Vietnam (‘‘Vietnam’’). See 

Certain Frozen Fish Fillets from 

Vietnam: Notice of Initiation and 

Preliminary Results of Changed 

Circumstances Review, 72 FR 46604 

(August 21, 2007) (Preliminary Results). 

In it, we stated we would issue the final 

results within 270 days after the date on 

which the changed circumstances 

review was initiated. We subsequently 

postponed that deadline until December 

5, 2008. See Certain Frozen Fish Fillets 

from Vietnam: Extension of Time Limit 

for Final Results of Changed 

Circumstances Review, 73 FR 60240 

(October 10, 2008). However, the 

Department now finds that it is not 

practicable to complete this review by 

December 5, 2008. Subsequent to the 

Preliminary Results and receipt of Vinh 

Hoan Co., Ltd./Corporation’s and 

Petitioners’ (the Catfish Farmers of 

America and individual U.S. catfish 

processors) case briefs, the Department 

requested and received new information 

from Vinh Hoan. Moreover, Vinh Hoan 

requested an extension to the time limit 

for submission of this new information. 

As a result, additional time is needed to 

review the information and prepare the 

results. Consequently, in accordance 

with 19 CFR 351.302(b), the Department 

is extending the time period for issuing 

the final results until February 18, 2009. 

This notice is published in 

accordance with section 771(i) of the 

Tariff Act of 1930, as amended. 

Dated: December 5, 2008. 

Gary Taverman, 

Acting Deputy Assistant Secretary for 

Antidumping and Countervailing Operations. 

[FR Doc. E9–623 Filed 1–13–09; 8:45 am] 

BILLING CODE 3510–DS–S 

DEPARTMENT OF COMMERCE 

International Trade Administration 

[A–570–929] 

Final Determination of Sales at Less 

Than Fair Value and Affirmative 

Determination of Critical 

Circumstances: Small Diameter 

Graphite Electrodes from the People’s 

Republic of China 

AGENCY: Import Administration, 

International Trade Administration, 

Department of Commerce. 

EFFECTIVE DATE: January 14, 2009. 

SUMMARY: The Department of Commerce 

(the Department) has determined that 

small diameter graphite electrodes from 

the People’s Republic of China (PRC) are 

being, or are likely to be, sold in the 

United States at less than fair value 

(LTFV) as provided in section 735 of the 

Tariff Act of 1930, as amended (the Act). 

The final dumping margins for this 

investigation are listed in the ‘‘Final 

Determination Margins’’ section below. 

The period covered by the investigation 

is July 1, 2007, through December 31, 

2007 (the POI). 

FOR FURTHER INFORMATION CONTACT: 

Magd Zalok or Drew Jackson, AD/CVD 

Operations, Office 4, Import 

Administration, International Trade 

Administration, U.S. Department of 

Commerce, 14th Street and Constitution 

Avenue, NW, Washington, DC, 20230; 

telephone: (202) 482–4162 and 482– 

4406, respectively. 

SUPPLEMENTARY INFORMATION: 

Background 

The Department published its 

preliminary determination of sales at 

LTFV on August 21, 2008. See Small 

Diameter Graphite Electrodes From the 

People’s Republic of China: Preliminary 

Determination of Sales at Less Than 

Fair Value, Postponement of Final 

Determination, and Affirmative 

Preliminary Determination of Critical 

Circumstances, in Part, 73 FR 49408 

(August 21, 2008) (Preliminary 

Determination). On August 25, 2008, the 

Department received ministerial error 

allegations from petitioners1 and one 


sroberts on PROD1PC70 with NOTICES
2050 Federal Register / Vol. 74, No. 9 / Wednesday, January 14, 2009 / Notices 

2The following companies comprise the Fangda 

Group: Fushun Carbon Co., Ltd. (Fushun Carbon), 

Fangda Carbon New Material Co., Ltd. (Fangda 

Carbon), Chengdu Rongguang Carbon Co., Ltd. 

(Chengdu Rongguang), Beijing Fangda Carbon Tech 

Co., Ltd. (Beijing Fangda), and Hefei Carbon Co., 

Ltd. (Hefei Carbon). 

respondent, the Fangda Group.2 On 

August 26, 2008, petitioners submitted 

a ministerial error allegation with 

respect to Fushun Jinly Petrochemical 

Carbon Co., Ltd. (Fushun Jinly), another 

respondent in the investigation. On 

August 28, 2008, in response to the 

Department’s request, petitioners 

submitted information regarding the 

effect the alleged errors have on the 

dumping margin calculated for the 

Fangda Group. After reviewing the 

allegations, the Department determined 

that the Preliminary Determination 

included significant ministerial errors 

with regard to the Fangda Group. On 

September 22, 2008, the Department 

published its amended preliminary 

determination of sales at LTFV. See 

Small Diameter Graphite Electrodes 

from the People’s Republic of China: 

Amended Preliminary Determination of 

Sales at Less Than Fair Value, 73 FR 

54561 (September 22, 2008) (Amended 

Preliminary Determination). 

On September 22, 2008, M. Brashem, 

Inc. (Brashem), a U.S. importer of small 

diameter graphite electrodes, requested 

that the Department correct its amended 

preliminary determination by applying 

the Fangda Group’s cash deposit rate to 

Hefei Carbon, one of the companies in 

the Fangda Group. See Brashem’s 

September 22, 2008 submission to the 

Department. On October 8, 2008, the 

Department issued a memorandum 

stating that it would not further amend 

its Preliminary Determination because 

Brashem’s allegation did not constitute 

a ministerial error. See Memorandum 

from Magd Zalok, International Trade 

Compliance Analyst, to Abdelali 

Elouaradia, Director, Office 4, dated 

October 8, 2008. 

Between August 25, 2008, and 

September 18, 2008, the Department 

conducted verifications of the following 

companies in the Fangda Group: 

Fushun Carbon, Fangda Carbon, 

Chengdu Rongguang and Beijing 

Fangda. See the ‘‘Verification’’ section 

below for additional information. 

On August 25, 2008, Fushun Jinly 

filed an untimely and unsolicited 

submission with the Department in 

which it made substantial revisions to 

its factors of production (FOP) database. 

In response to requests from the 

Department, on August 27, 2008, and 

September 3, 2008, Fushun Jinly filed 

submissions with the Department 

explaining the untimely revisions. In a 

letter issued to Fushun Jinly on 

September 9, 2008, the Department 

rejected the untimely new database, as 

well as the August 27, 2008 and 

September 3, 2008 submissions, and 

informed Fushun Jinly of the 

Department’s intention not to verify any 

of its information because the untimely 

submission raised serious questions as 

to the credibility of its previously 

reported information. See Letter to 

Fushun Jinly, dated September 9, 2008 

(September 9, 2008 Letter). 

On October 6, 2008, the petitioners 

requested that the Department issue an 

amended preliminary scope 

determination to include connecting pin 

joining systems (connecting pins) in the 

scope of the investigation. 

In response to the Department’s 

invitation to comment on the 

Preliminary Determination, on 

November 3, 2008, the petitioners, the 

Fangda Group and Fushun Jinly filed 

case briefs. The petitioners, the Fangda 

Group and Fushun Jinly filed rebuttal 

briefs on November 10, 2008. Upon 

requests from the petitioners, the 

Fangda Group and Fushun Jinly, on 

November 20, 2008, the Department 

held a public hearing. 

Analysis of Comments Received 

All of the issues raised in the case and 

rebuttal briefs submitted in this 

investigation are addressed in the 

‘‘Issues and Decision Memorandum for 

the Final Determination in the Less– 

Than-Fair–Value Investigation of Small 

Diameter Graphite Electrodes from the 

People’s Republic of China,’’ dated 

January 5, 2009, which is hereby 

adopted by this notice (Issues and 

Decision Memorandum). Appendix I to 

this notice contains a list of the issues 

addressed in the Issues and Decision 

Memorandum. The Issues and Decision 

Memorandum, which is a public 

document, is on file in the Central 

Records Unit (CRU) at the Main 

Commerce Building, Room 1117, and is 

accessible on the Web at http:// 

ia.ita.doc.gov/frn. The paper copy and 

electronic version of the memorandum 

are identical in content. 

Changes Since the Preliminary 

Determination 

Based on our analysis of the 

comments received, we have made the 

following changes to our preliminary 

determination: 

1. We based our determination with 

respect to Fushun Jinly on total 

adverse facts available (AFA) 

because its questionnaire responses 

were not verifiable and because 

Fushun Jinly failed to cooperate to 

the best of its ability with this 

investigation. As total AFA, we 

found Fushun Jinly to be part of the 

PRC–wide entity. 

2. We assigned the Fangda Group a 

dumping margin based on total 

AFA because we found its FOP data 

to be unreliable and because the 

Fangda Group failed to cooperate to 

the best of its ability with this 

investigation. As total AFA, we 

assigned the Fangda Group the 

highest margin in this proceeding. 

3. We have determined that critical 

circumstances exist with respect to 

the Fangda Group, the separate rate 

companies, and the PRC–wide 

entity, including Fushun Jinly. 

4. We have assigned the separate rate 

companies a dumping margin equal 

to the simple average of the margins 

alleged in the petition. See the 

Antidumping Petition for Small 

Diameter Graphite Electrodes for 

the Peoples Republic of China, 

dated January 17, 2008, and 

amendment to Petition, dated 

January 30, 2008. 

5. We determined that connecting 

pins are covered by the scope of the 

investigation. 

Scope of Investigation 

The merchandise covered by this 

investigation includes all small 

diameter graphite electrodes of any 

length, whether or not finished, of a 

kind used in furnaces, with a nominal 

or actual diameter of 400 millimeters 

(16 inches) or less, and whether or not 

attached to a graphite pin joining system 

or any other type of joining system or 

hardware. The merchandise covered by 

this investigation also includes graphite 

pin joining systems for small diameter 

graphite electrodes, of any length, 

whether or not finished, of a kind used 

in furnaces, and whether or not the 

graphite pin joining system is attached 

to, sold with, or sold separately from, 

the small diameter graphite electrode. 

Small diameter graphite electrodes and 

graphite pin joining systems for small 

diameter graphite electrodes are most 

commonly used in primary melting, 

ladle metallurgy, and specialty furnace 

applications in industries including 

foundries, smelters, and steel refining 

operations. Small diameter graphite 

electrodes and graphite pin joining 

systems for small diameter graphite 

electrodes that are subject to this 

investigation are currently classified 

under the Harmonized Tariff Schedule 

of the United States (HTSUS) 

subheading 8545.11.0000. The HTSUS 

number is provided for convenience and 

customs purposes, but the written 

description of the scope is dispositive. 


sroberts on PROD1PC70 with NOTICES
Federal Register / Vol. 74, No. 9 / Wednesday, January 14, 2009 / Notices 2051 

3The Department incorrectly listed 159.34 

percent as the highest petition margin in the 

Preliminary Determination. In fact, the highest 

margin alleged in the Petition is 159.64 percent. See 

the Petition, and Enclosure 4 of petitioners’ January 

30, 2008, addendum to Petition. 

Scope Comments 

In their October 6, 2008, submission, 

as well as their November 3, 2008, case 

brief, the petitioners argued that the 

scope of this investigation should 

include all connecting pins for small 

diameter graphite electrodes, whether or 

not they are sold separately from the 

graphite electrodes, and requested that 

the Department amend its preliminary 

determination to include connecting 

pins in the scope of the investigation. 

The respondents argued that connecting 

pins are within the scope of the 

investigation when they are sold with 

graphite electrodes (either attached to 

the electrode or unattached), but not 

when they are sold separately from the 

graphite electrodes (i.e., when the 

connecting pins are not part of an 

electrode order). For the reasons 

discussed in the Issues and Decision 

Memorandum, the Department has 

determined that all connecting pins are 

included in the scope of this 

investigation. The scope description 

found in the ‘‘Scope of Investigation’’ 

section above reflects this 

determination. See Issues and Decision 

Memorandum at Comment 2. 

Verification 

As provided in section 782(i) of the 

Act, we conducted verifications of the 

Fangda Group’s information. See the 

Department’s verification reports for the 

Fangda Group, on file in the CRU. In 

conducting the verifications, we used 

standard verification procedures, 

including examination of relevant 

accounting and production records, as 

well as original source documents 

provided by the respondent. 

Adverse Facts Available 

Section 776(a)(2) of the Act provides 

that, if an interested party (A) withholds 

information requested by the 

Department, (B) fails to provide such 

information by the deadline, or in the 

form or manner requested, (C) 

significantly impedes a proceeding, or 

(D) provides information that cannot be 

verified, the Department shall use, 

subject to section 782(d) of the Act, facts 

otherwise available in reaching the 

applicable determination. Section 

782(d) of the Act allows the Department, 

subject to section 782(e) of the Act, to 

disregard all or part of a deficient or 

untimely response from a respondent. 

Pursuant to section 782(e) of the Act, 

the Department shall not decline to 

consider submitted information if all of 

the following requirements are met: (1) 

the information is submitted by the 

established deadline; (2) the information 

can be verified; (3) the information is 

not so incomplete that it cannot serve as 

a reliable basis for reaching the 

applicable determination; (4) the 

interested party has demonstrated that it 

acted to the best of its ability; and (5) 

the information can be used without 

undue difficulties. 

Section 776(b) of the Act authorizes 

the Department to use an adverse 

inference with respect to an interested 

party if the Department finds that the 

party failed to cooperate by not acting 

to the best of its ability to comply with 

a request for information. 

A. Total Adverse Facts Available for 

Fushun Jinly 

On August 25, 2008, after the 

preliminary determination, and on the 

same day that the verification of the 

Fangda Group began, Fushun Jinly filed 

untimely and unsolicited new 

information consisting of substantial 

revisions to its FOP database, and other 

previously undisclosed information. In 

its untimely submission and subsequent 

submissions explaining the untimely 

submission, Fushun Jinly: (1) revealed 

for the first time that it sold by–products 

during the POI, although it had 

repeatedly stated that it reused its by– 

products; (2) admitted for the first time 

that the subcontractors who performed 

graphitization would not provide any 

documents to support the FOP data they 

had submitted; (3) reported substantial 

reductions to consumption quantities 

for major graphitization inputs 

consumed by the same subcontractors 

whose records could not be verified; (4) 

provided company records which call 

into question the number of 

subcontractors reportedly used in the 

graphitization process during the POI, 

and whether Fushun Jinly accurately 

and fully reported to the Department its 

FOP data for such a process; (5) 

provided production documents 

indicating that it could have reported 

the FOP data using control number 

(CONNUM) characteristics in addition 

to power level, which it had repeatedly 

denied it was able to do prior to the 

preliminary determination; and (6) 

reported FOP data for certain graphite 

electrodes and connecting pins 

separately, contrary to its repeated 

contention that it could not do so. On 

September 9, 2008, the Department 

rejected Fushun Jinly’s untimely August 

25, 2008, FOP submission. See 

September 9, 2008 Letter. In rejecting 

the untimely FOP database, the 

Department stated that the untimely 

database and subsequent related 

submissions: (1) indicated that Fushun 

Jinly had previously failed to properly 

report significant FOP data for one of 

the two types of electrodes sold during 

the POI; (2) called into question the 

accuracy and verifiability of the FOP 

data reported for graphitization; (3) 

called into question claims regarding 

the number of subcontractors used 

during the POI and the level of product 

specificity to which FOP data could 

have been reported; (4) indicated that 

Fushun Jinly may have purchased 

graphitized semi–finished products in 

addition to the graphitized semi– 

finished products supplied by 

subcontractors. See id. Given the 

foregoing concerns, the Department 

stated that it would not be appropriate 

to verify any of the information reported 

by Fushun Jinly. See id . 

Fushun Jinly’s untimely FOP 

submission contained information that 

the Department had repeatedly sought 

throughout the investigation, yet 

Fushun Jinly repeatedly failed to 

provide the requested information by 

the deadlines established for submitting 

such information. Thus, we have 

determined that Fushun Jinly’s actions 

significantly impeded the proceeding. 

Moreover, Fushun Jinly’s untimely FOP 

submission and subsequent related 

submissions demonstrated that 

important elements of the FOP data on 

the record were either inaccurate, 

improperly reported, and/or could not 

be verified. Additionally, Fushun Jinly’s 

actions demonstrate that it failed to 

cooperate by not acting to the best of its 

ability to comply with requests from the 

Department. Accordingly, pursuant to 

sections 776(a)(2)(A), (B), (C) and (D) 

and 776(b) of the Act, we have used 

AFA in reaching our final determination 

with respect to Fushun Jinly. 

Specifically, we have treated Fushun 

Jinly as part of the PRC–wide entity and 

assigned Fushun Jinly the PRC–wide 

rate of 159.64 percent.3 See the sections 

entitled ‘‘The PRC–Wide Rate’’ and 

‘‘Corroboration,’’ below, for a discussion 

of the selection and corroboration of the 

PRC–Wide rate. See also the 

accompanying Issues and Decision 

Memorandum at Comment 1 for details. 

Total Adverse Facts Available for the 

Fangda Group 

During verification of the Fangda 

Group’s responses, the Department 

found that the Fangda Group: (1) failed 

to report FOP data for Hefei Carbon, one 

of the companies within the Fangda 

Group that produced small diameter 

graphite electrodes with characteristics 

that matched the CONNUM 


sroberts on PROD1PC70 with NOTICES
2052 Federal Register / Vol. 74, No. 9 / Wednesday, January 14, 2009 / Notices 

characteristics reported for certain U.S. 

sales; (2) failed to identify the existence 

of, and report FOP data for, a number 

of tollers that performed significant 

processes on small diameter graphite 

electrodes with characteristics that 

matched the CONNUM characteristics 

reported for certain U.S. sales; and (3) 

had production records that could have 

been used to report factor quantities 

using more of the CONNUM criteria 

then were used, despite repeated claims 

to the contrary. The missing information 

noted above had been previously 

requested by the Department. Thus, the 

record shows that the Fangda Group 

withheld information requested by the 

Department and significantly impeded 

the proceeding. Moreover, given the 

importance of the missing information, 

we have determined that we lack 

reliable data to calculate normal value. 

Consequently, pursuant to sections 

776(a)(2)(A), and (C) of the Act, we have 

determined that the Fangda Group’s 

dumping margin should be based on 

total facts available. 

Furthermore, the Fangda Group 

possessed the information needed to 

report FOP data for Hefei Carbon and 

the production records that could have 

been used to report factor quantities 

using more of the CONNUM criteria 

then were used. Thus, the Fangda Group 

could have reported to the Department 

the FOP data for Hefei Carbon and factor 

quantities that were more CONNUM– 

specific. Moreover, the Fangda Group 

never informed the Department of the 

existence of the unreported tollers, nor 

is there any indication on the record 

that the Fangda Group ever attempted to 

obtain any data from the unreported 

tollers. Accordingly, we find that the 

Fangda Group failed to act to the best of 

its ability in this investigation, and, 

pursuant to section 776(b) of the Act, 

the use of an adverse inference is 

warranted. 

Section 776(b) of the Act authorizes 

the Department to use, as AFA: 

information derived from: (1) the 

petition; (2) the final determination 

from the LTFV investigation; (3) a 

previous administrative review; or (4) 

any other information placed on the 

record. In selecting a rate for AFA, the 

Department selects one that is 

sufficiently adverse ‘‘as to effectuate the 

purpose of the facts available rule to 

induce respondents to provide the 

Department with complete and accurate 

information in a timely manner.’’ See 

Notice of Final Determination of Sales 

at Less Than Fair Value: Static Random 

Access Memory Semiconductors From 

Taiwan, 63 FR 8909 (February 23, 1998). 

It is the Department’s practice to select, 

as AFA, the higher of: (a) the highest 

margin alleged in the petition or (b) the 

highest calculated rate for any 

respondent in the investigation. See 

Final Determination of Sales at Less 

Than Fair Value: Certain Cold–Rolled 

Flat–Rolled Carbon Quality Steel 

Products From the People’s Republic of 

China, 65 FR 34660 (May 31, 2000) and 

accompanying Issues and Decisions 

Memorandum at Facts Available (Cold– 

Rolled Flat–Rolled Steel From the PRC). 

The highest margin alleged in the 

Petition is 159.64 percent. Since the 

highest dumping margin derived from 

the Petition is higher than the 

weighted–average margins calculated in 

this case, we have, as AFA, assigned the 

Fangda Group the highest margin 

alleged in the Petition, 159.64 percent. 

See the Petition, and Enclosure 4 of 

petitioners’ January 30, 2008, addendum 

to Petition. 

In addition, because the shipment 

data reported by the Fangda Group in 

connection with critical circumstances 

were not reported on the basis of 

shipment date as required by the 

Department, and could not be verified, 

we have found, as AFA, that imports 

were massive with respect to the Fangda 

Group. See the section of this notice 

entitled ‘‘Critical Circumstances,’’ 

below, for a discussion of our critical 

circumstances determination and the 

section of this notice entitled 

‘‘Corroboration,’’ below, for a discussion 

of the corroboration of the highest 

petition rate. See, also, the 

accompanying Issues and Decision 

memorandum at Comment 3 for details. 

Critical Circumstances 

In the Preliminary Determination, the 

Department found that there was reason 

to believe or suspect that critical 

circumstances exist for imports of 

subject merchandise from the Fangda 

Group and the separate rate companies 

because: (1) in accordance with section 

733(e)(1)(A)(ii) of the Act, the person by 

whom, or for whose account, the 

merchandise was imported knew or 

should have known that the exporter 

was selling the subject merchandise at 

less than its fair value and that there 

was likely to be material injury by 

reason of such sales; and (2) in 

accordance with section 733(e)(1)(B) of 

the Act, the Fangda Group and the 

separate rate companies had massive 

imports during a relatively short period. 

However, the Department did not 

preliminarily find that there was reason 

to believe or suspect that critical 

circumstances existed for imports of 

subject merchandise from Fushun Jinly 

or the PRC–wide entity. See Preliminary 

Determination. In their case briefs, the 

petitioners argued that because the 

application of total AFA to both Fushun 

Jinly and the Fangda Group is 

warranted, the Department should find 

that critical circumstances exist with 

respect to these companies as well as 

the separate rate companies and the 

PRC–wide entity. If the Department 

does not apply total AFA to Fushun 

Jinly and the Fangda Group, the 

petitioners argue that, as partial AFA, 

the Department should find a massive 

increase in subject imports from these 

companies and determine the critical 

circumstances exist with respect to 

Fushun Jinly as well as the Fangda 

Group and the separate rate companies. 

Fushun Jinly and the Fangda Group 

contend that the Department’s critical 

circumstances determination should be 

based on their reported export data, 

rather than AFA. If, however, the 

Department determines, as AFA, that 

massive imports exist, the respondents 

argue that the Department should not 

find critical circumstances for any party 

if the dumping margins are less than 25 

percent for the Fangda Group and the 

separate rate companies, including 

Fushun Jinly. In any case, the 

respondents maintain that the 

Department should not rely upon 

import statistics for HTSUS number 

8545.11.00.00 to determine whether 

massive subject imports exist since this 

HTSUS number includes imports of 

non–subject merchandise (i.e., large 

diameter graphite electrodes). 

As noted above, the Department was 

not able to verify the shipment data 

reported by the Fangda Group in 

connection with critical circumstances 

because the data were not reported on 

the basis of shipment date as required 

by the Department. Since the shipment 

data provided by the Fangda Group 

could not be verified, we find that the 

Fangda Group failed to cooperate by not 

acting to the best of its ability to provide 

the requested shipment data. 

Accordingly, we have based our 

determination of whether there were 

massive imports with respect to the 

Fangda Group on AFA (see section 776 

(a)(2)(D) and 776 (b) of the Act). The 

Statement of Administrative Action 

(SAA) accompanying the Uruguay 

Round Agreements Act, H.R. Doc. 103– 

316, Vol. 1 (1994) at 870, notes that the 

Department may employ adverse 

inferences in selecting from among the 

facts available ‘‘to ensure that the party 

does not obtain a more favorable result 

by failing to cooperate fully.’’ The SAA 

also instructs the Department to 

consider, in employing adverse 

inferences, ‘‘the extent to which a party 

may benefit from its own lack of 

cooperation.’’ Id. Based on the shipment 


sroberts on PROD1PC70 with NOTICES
Federal Register / Vol. 74, No. 9 / Wednesday, January 14, 2009 / Notices 2053 

data reported by the Fangda Group in 

connection with critical circumstances, 

in the Preliminary Determination the 

Department found massive imports with 

respect to the Fangda Group. To ensure 

that the Fangda Group does not obtain 

a more favorable result by failing to 

cooperate, for this final determination, 

we continue to find, as AFA, that 

imports of subject merchandise were 

massive for the Fangda Group. 

In addition, based on our comparison 

of the unadjusted volume of imports of 

graphite electrodes from the PRC 

reported by the International Trade 

Commission’s (ITC) DataWeb for the 

periods February 2008 through July 

2008 and August 2007 through January 

2008, we found that imports were 

massive for the separate rate companies 

and the PRC–wide entity, including 

Fushun Jinly. We did not reduce the 

ITC’s DataWeb import volumes by 

shipment volumes reported by the 

Fangda Group and Fushun Jinly, or rely 

upon these companies’ shipment 

volumes in determining whether 

massive imports exist for the separate 

rate companies because the shipment 

data submitted by Fushun Jinly and the 

Fangda Group were not verified. Thus, 

these data are no longer reliable for 

purposes of our final critical 

circumstances analysis. Moreover, 

because the dumping margins applied to 

all interested parties in this 

investigation exceed 25 percent, we find 

that importers should have known that 

graphite electrodes were being sold at 

LTFV. We also continue to find the 

ITC’s preliminary injury determination 

in the instant investigation is sufficient 

to impute knowledge of material injury 

to the importers. Accordingly, the 

Department finds that critical 

circumstances exist for the Fangda 

Group, the separate rate applicants, and 

the PRC–wide entity, including Fushun 

Jinly. For further details, see Comment 

4 of the Issues and Decision 

Memorandum. 

Surrogate Country 

In the Preliminary Determination, we 

selected India as the appropriate 

surrogate country noting that it was on 

the Department’s list of countries that 

are at a level of economic development 

comparable to the PRC and that: (1) 

India is a significant producer of 

merchandise comparable to subject 

merchandise; and, (2) reliable Indian 

data for valuing factors of production 

are readily available. See Preliminary 

Determination. No party has commented 

on our selection of India as the 

appropriate surrogate country. For the 

final determination, we continue to find 

India to be the appropriate surrogate 

country in this investigation. 

Separate Rates 

In proceedings involving non–marketeconomy (NME) countries, the 

Department begins with a rebuttable 

presumption that all companies within 

the country are subject to government 

control and, thus, should be assigned a 

single antidumping duty deposit rate. It 

is the Department’s policy to assign all 

exporters of merchandise subject to an 

investigation in an NME country this 

single rate unless an exporter can 

demonstrate that it is sufficiently 

independent so as to be entitled to a 

separate rate. See Final Determination of 

Sales at Less Than Fair Value: Sparklers 

from the People’s Republic of China, 56 

FR 20588 (May 6, 1991) (Sparklers), as 

amplified by Notice of Final 

Determination of Sales at Less Than 

Fair Value: Silicon Carbide from the 

People’s Republic of China, 59 FR 22585 

(May 2, 1994) (Silicon Carbide); see also 

19 C.F.R. § 351.107(d). 

In the Preliminary Determination, the 

Department granted separate–rate status 

to Fushun Jinly, Fushun Carbon, Fangda 

Carbon, Beijing Fangda, Chengdu 

Rongguang, and the following separate 

rate applicants: Jilin Carbon Import and 

Export Company (Jilin Carbon); 

Guanghan Shida Carbon Co., Ltd. 

(Guanghan Shida); Nantong River–East 

Carbon Joint Stock Co., Ltd. (Nantong 

River); Xinghe County Muzi Carbon Co. 

Ltd. (Muzi Carbon); Brilliant Charter 

Limited (Brilliant Charter); Shijiazhuang 

Huanan Carbon Factory (Huanan 

Carbon); Shenyang Jinli Metals & 

Minerals Imp & Exp Co., Ltd. (Shenyang 

Jinli); Shanghai Jinneng International 

Trade Co., Ltd. (Shanghai Jinneng); 

Dalian Thrive Metallurgy Import and 

Export Co., Ltd.; GES (China) Co., Ltd. 

(Dalian Thrive); and Qingdao Haosheng 

Metals & Minerals Imp & Exp Co., Ltd. 

(Qingdao Metal). As discussed above, 

the Department decided, as AFA, to 

treat Fushun Jinly as part of the PRC– 

wide entity. Moreover, we note that the 

information that Fushun Jinly provided 

to the Department to demonstrate the 

absence of de facto and de jure control 

was not verified. Consequently we have 

not granted Fushun Jinly a separate rate. 

Although we are basing the Fangda 

Group’s margin on total AFA, the 

Department was able to verify the 

Fangda Group’s separate rate 

information (e.g., ownership, selection 

of management process, etc.) for Fushun 

Carbon, Fangda Carbon, Beijing Fangda, 

and Chengdu Rongguang. Thus, we are 

continuing to find that the evidence 

placed on the record of this 

investigation by the Fangda Group 

demonstrates both a de jure and de facto 

absence of government control, with 

respect to Fushun Carbon, Fangda 

Carbon, Beijing Fangda, and Chengdu 

Rongguang, exports of the merchandise 

under investigation and thus they are 

eligible for separate–rate status. Because 

no parties commented on its separate– 

rate status of the other separate–rate 

applicants, we continue to find the 

other separate–rate applicants are 

eligible for separate–rate status. Since 

we assigned the Fangda Group a 

dumping margin based on total AFA, 

and we are considering Fushun Jinly to 

be part of the PRC–wide entity, we do 

not have any mandatory respondents in 

this investigation whose dumping 

margin is not based on total AFA. Thus, 

we have assigned the other separate rate 

companies a dumping margin equal to 

the simple average of the margins 

alleged in the petition. 

The PRC–Wide Rate 

In the Preliminary Determination, the 

Department considered certain non– 

responsive PRC producers/exporters to 

be part of the PRC–wide entity because 

they did not respond to our requests for 

information and did not demonstrate 

that they operated free of government 

control over their export activities. No 

additional information regarding these 

entities has been placed on the record 

since the publication of the Preliminary 

Determination. Since the PRC–wide 

entity did not provide the Department 

with requested information, pursuant to 

section 776(a)(2)(A) of the Act (which 

covers situations where an interested 

party withholds requested information), 

we continue to find it appropriate to 

base the PRC–wide rate on facts 

available. Moreover, given that the PRC– 

wide entity did not respond to our 

request for information, we continue to 

find that it failed to cooperate to the best 

of its ability to comply with a request 

for information. Thus, pursuant to 

section 776(b) of the Act, we have 

continued to use an adverse inference in 

selecting from among the facts 

otherwise available. See, e.g., Notice of 

Final Determination of Sales at Less 

Than Fair Value: Certain Cold–Rolled 

Flat–Rolled Carbon–Quality Steel 

Products from the Russian Federation, 

65 FR 5510, 5518 (February 4, 2000) (a 

case in which the Department applied 

an adverse inference in determining the 

Russia–wide rate); Final Determination 

of Sales at Less Than Fair Value: 

Certain Artists Canvas from the People’s 

Republic of China, 71 Fed. Reg. 16116, 

16118–19 (March 30, 2006) (a case in 

which the Department applied an 

adverse inference in determining the 

PRC–wide rate). 


sroberts on PROD1PC70 with NOTICES
2054 Federal Register / Vol. 74, No. 9 / Wednesday, January 14, 2009 / Notices 

Pursuant to section 776(b) of the Act, 

the Department may select, as AFA 

information derived from: (1) the 

petition; (2) the final determination 

from the LTFV investigation; (3) a 

previous administrative review; or (4) 

any other information placed on the 

record. As noted above, in order to 

induce respondents to provide the 

Department with complete and accurate 

information in a timely manner, the 

Department’s practice is to select, as 

AFA, the higher of: (a) the highest 

margin alleged in the petition or (b) the 

highest calculated rate for any 

respondent in the investigation. See 

Cold–Rolled Flat–Rolled Steel From the 

PRC. The highest margin alleged in the 

Petition is 159.64 percent. Since the 

dumping margin derived from the 

Petition is higher than the weighted– 

average margins calculated in this case, 

we have continued to assign the PRC– 

wide entity a dumping margin of 159.64 

percent. See the Petition, and Enclosure 

4 of petitioners’ January 30, 2008, 

addendum to Petition. 

Since we begin with the presumption 

that all companies within an NME 

country are subject to government 

control and only the exporters listed 

under the ‘‘Final Determination 

Margins’’ section below have overcome 

that presumption, we are applying a 

single antidumping rate (i.e., the PRC– 

wide rate) to all exporters of subject 

merchandise from the PRC, other than 

the exporters listed in the ‘‘Final 

Determination Margins’’ section of this 

notice. See, e.g., Synthetic Indigo from 

the People’s Republic of China: Notice 

of Final Determination of Sales at Less 

Than Fair Value, 65 FR 25706 (May 3, 

2000) (applying the PRC–wide rate to all 

exporters of subject merchandise in the 

PRC based on the presumption that the 

export activities of the companies that 

failed to respond to the Department’s 

questionnaire were controlled by the 

PRC government). 

Corroboration 

Section 776(c) of the Act provides 

that, when the Department relies on 

secondary information in using the facts 

otherwise available, it must, to the 

extent practicable, corroborate that 

information from independent sources 

that are reasonably at its disposal. We 

have interpreted ‘‘corroborate’’ to mean 

that we will, to the extent practicable, 

examine the reliability and relevance of 

the information submitted. See Certain 

Cold–Rolled Flat–Rolled Carbon– 

Quality Steel Products From Brazil: 

Notice of Final Determination of Sales 

at Less Than Fair Value, 65 FR 5554, 

5568 (February 4, 2000); see, e.g., 

Tapered Roller Bearings and Parts 

Thereof, Finished and Unfinished, from 

Japan, and Tapered Roller Bearings, 

Four Inches or Less in Outside 

Diameter, and Components Thereof, 

from Japan; Preliminary Results of 

Antidumping Duty Administrative 

Reviews and Partial Termination of 

Administrative Reviews, 61 FR 57391, 

57392 (November 6, 1996). 

To corroborate the 159.64 percent 

margin used as AFA for the PRC–wide 

entity, we relied upon our pre–initiation 

analysis of the adequacy and accuracy 

of the information in the Petition. See 

Small Diameter Graphite Electrodes 

from the People’s Republic of China: 

Initiation of Antidumping Duty 

Investigation, 73 FR 8287 (February 13, 

2008) (Initiation Notice); see also Notice 

of Final Determination of Sales at Less 

Than Fair Value and Affirmative Final 

Determination of Critical 

Circumstances: Circular Welded Carbon 

Quality Steel Pipe from the People’s 

Republic of China, 73 FR 31970, 31972 

(June 5, 2008) (where the Department 

relied upon pre–initiation analysis to 

corroborate the highest margin alleged 

in the petition). During the initiation 

stage, we examined evidence supporting 

the calculations in the petition and the 

supplemental information provided by 

petitioners to determine the probative 

value of the margins alleged in the 

Petition. During our pre–initiation 

analysis, we examined the information 

used as the basis of export price and 

normal value (NV) in the Petition, and 

the calculations used to derive the 

alleged margins. Also, during our pre– 

initiation analysis, we examined 

information from various independent 

sources provided either in the Petition 

or, based on our requests, in 

supplements to the Petition, which 

corroborated key elements of the export 

price and NV calculations. Id. Since the 

initiation, the Department has found no 

other corroborating information 

available in this case, and received no 

comments from interested parties as to 

the relevance or reliability of this 

secondary information. Based on the 

above, for the final determination, the 

Department finds that the rates derived 

from the Petition are corroborated to the 

extent practicable for purposes of the 

AFA rate assigned to the PRC–wide 

entity and the Fangda Group. 

Combination Rates 

In the Initiation Notice, the 

Department stated that it would 

calculate combination rates for certain 

respondents that are eligible for a 

separate rate in this investigation. See 

Initiation Notice. This change in 

practice is described in Policy Bulletin 

05.1: 

{w}hile continuing the practice of 

assigning separate rates only to 

exporters, all separate rates that the 

Department will now assign in its 

NME investigations will be specific 

to those producers that supplied the 

exporter during the period of 

investigation. Note, however, that 

one rate is calculated for the 

exporter and all of the producers 

which supplied subject 

merchandise to it during the period 

of investigation. This practice 

applies both to mandatory 

respondents receiving an 

individually calculated separate 

rate as well as the pool of non– 

investigated firms receiving the 

weighted–average of the 

individually calculated rates. This 

practice is referred to as the 

application of ‘‘combination rates’’ 

because such rates apply to specific 

combinations of exporters and one 

or more producers. The cash– 

deposit rate assigned to an exporter 

will apply only to merchandise 

both exported by the firm in 

question and produced by a firm 

that supplied the exporter during 

the period of investigation.’’ 

See Policy Bulletin 05.1, ‘‘Separate Rates 

Practice and Application of 

Combination Rates in Antidumping 

Investigations Involving Non–Market 

Economy Countries.’’ 

Final Determination Margins 

We determine that the following 

weighted–average dumping margins 

exist for the period July 1, 2007, through 

December 31, 2007: 

Exporter & Producer Weighted–Average Margin 

Fushun Carbon Co., Ltd. Produced by: Fushun Carbon Co., Ltd. ......................................................................... 159.64% 

Fangda Carbon New Material Co., Ltd. Produced by: Fangda Carbon New Material Co., Ltd. ............................ 159.64% 

Beijing Fangda Carbon Tech Co., Ltd. Produced by: Chengdu Rongguang Carbon Co., Ltd.; Fangda Carbon 

New Material Co., Ltd.; or Fushun Carbon Co., Ltd. ........................................................................................... 159.64 % 

Chengdu Rongguang Carbon Co., Ltd. Produced by: Chengdu Rongguang Carbon Co., Ltd. ............................ 159.64% 

Jilin Carbon Import and Export Company Produced by: Sinosteel Jilin Carbon Co., Ltd. ..................................... 132.90% 


sroberts on PROD1PC70 with NOTICES
Federal Register / Vol. 74, No. 9 / Wednesday, January 14, 2009 / Notices 2055 

4As noted above, the separate rate applicants are 

Jilin Carbon; Guanghan Shida Carbon Co., Ltd; 

Nantong River East Carbon Co. Ltd.; Xinghe County 

Muzi Carbon Co. Ltd.; Brilliant Charter Limited; 

Shijiazhuang Huanan Carbon Factory; Shenyang 

Jinli Metals & Minerals Imp & Exp Co., Ltd.; 

Shanghai Jinneng International Trade Co., Ltd.; 

Dalian Thrive Metallurgy Import and Export Co., 

Ltd.; GES (China) Co., Ltd.; and Qingdao Haosheng 

Metals & Minerals Imp & Exp Co., Ltd.. 

Exporter & Producer Weighted–Average Margin 

Guanghan Shida Carbon Co., Ltd. Produced by: Guanghan Shida Carbon Co., Ltd. ........................................... 132.90% 

Nantong River–East Carbon Joint Stock Co., Ltd. Produced by: Nantong River–East Carbon Co., Ltd.; or 

Nantong Yangzi Carbon Co., Ltd. ........................................................................................................................ 132.90% 

Xinghe County Muzi Carbon Co. Ltd. Produced by: Xinghe County Muzi Carbon Co., Ltd. ................................. 132.90% 

Brilliant Charter Limited Produced by: Nantong Falter New Energy Co., Ltd.; or Shanxi Jinneng Group Co., 

Ltd. ....................................................................................................................................................................... 132.90% 

Shijiazhuang Huanan Carbon Factory Produced by: Shijiazhuang Huanan Carbon Factory ................................ 132.90% 

Shenyang Jinli Metals & Minerals Imp & Exp Co., Ltd. Produced by: Shenyang Jinli Metals & Minerals Imp. & 

Exp. Co., Ltd. ....................................................................................................................................................... 132.90% 

Shanghai Jinneng International Trade Co., Ltd. Produced by: Shanxi Jinneng Group Datong Energy Development Co., Ltd. ...................................................................................................................................................... 132.90% 

Dalian Thrive Metallurgy Import and Export Co., Ltd. Produced by: Linghai Hongfeng Carbon Products Co., 

Ltd.; Tianzhen Jintian Graphite Electrodes Co., Ltd.; Jiaozuo Zhongzhou Carbon Products Co., Ltd.; 

Heilongjiang Xinyuan Carbon Products Co., Ltd.; Xuzhou Jianglong Carbon Manufacture Co., Ltd.; or 

Xinghe Xinyuan Carbon Products Co., Ltd. ......................................................................................................... 132.90% 

GES (China) Co., Ltd. Produced by: Shanghai GC Co., Ltd.; Fushun Jinli Petrochemical Carbon Co., Ltd.; 

Xinghe County Muzi Carbon Plant and Linyi County Lubei Carbon Co., Ltd. Shandong Province ................... 132.90% 

Qingdao Haosheng Metals & Minerals Imp & Exp Co., Ltd. Produced by: Sinosteel Jilin Carbon Co., Ltd. ........ 132.90% 

PRC–Wide Entity ..................................................................................................................................................... 159.64% 

Disclosure 

We will disclose to parties the 

calculations performed within five days 

of the date of public announcement of 

this determination in accordance with 

19 C.F.R. § 351.224(b). 

Continuation of Suspension of 

Liquidation 

In the Preliminary Determination, the 

Department found that critical 

circumstances exist with respect to 

imports of subject merchandise from the 

Fangda Group and the separate rate 

companies but the Department found 

that critical circumstances did not exist 

with respect to Fushun Jinly and the 

PRC–wide entity. As noted above, for 

the final determination, the Department 

has found that critical circumstances 

exist with respect to imports of subject 

merchandise from the Fangda Group, 

the separate rate companies, and the 

PRC–wide entity, including Fushun 

Jinly. Thus, in accordance with section 

735(c)(1)(B) of the Act, we are directing 

U.S. Customs and Border Protection 

(CBP) to continue to suspend 

liquidation of all imports of subject 

merchandise from the Fangda Group 

and the separate rate applicants4

entered, or withdrawn from warehouse, 

for consumption on or after May 23, 

2008, which is 90 days prior to the date 

of publication of the Preliminary 

Determination in the Federal Register. 

For the PRC wide entity, including 

Fushun Jinly, we will instruct CBP to 

suspend liquidation of all entries of 

subject merchandise entered, or 

withdrawn from warehouse, for 

consumption on or after May 23, 2008, 

pursuant to section 735(c)(4)(B) of the 

Act. We will instruct CBP to continue to 

require a cash deposit or the posting of 

a bond for all companies based on the 

estimated weighted–average dumping 

margins shown above. The suspension 

of liquidation instructions will remain 

in effect until further notice. 

ITC Notification 

In accordance with section 735(d) of 

the Act, we have notified ITC of our 

final determination of sales at LTFV. As 

our final determination is affirmative, in 

accordance with section 735(b)(2) of the 

Act, the ITC will determine whether the 

domestic industry in the United States 

is materially injured, or threatened with 

material injury, by reason of imports or 

sales (or the likelihood of sales) for 

importation of the subject merchandise 

within 45 days of this final 

determination. If the ITC determines 

that material injury or threat of material 

injury does not exist, the proceeding 

will be terminated and all securities 

posted will be refunded or canceled. If 

the ITC determines that such injury 

does exist, the Department will issue an 

antidumping duty order directing CBP 

to assess, upon further instruction by 

the Department, antidumping duties on 

all imports of the subject merchandise 

entered, or withdrawn from warehouse, 

for consumption on or after the effective 

date of the suspension of liquidation. 

Notification Regarding APO 

This notice also serves as a reminder 

to the parties subject to administrative 

protective order (APO) of their 

responsibility concerning the 

disposition of proprietary information 

disclosed under APO in accordance 

with 19 C.F.R. § 351.305. Timely 

notification of return or destruction of 

APO materials or conversion to judicial 

protective order is hereby requested. 

Failure to comply with the regulations 

and the terms of an APO is a 

sanctionable violation. This 

determination and notice are issued and 

published in accordance with sections 

735(d) and 777(i)(1) of the Act. 

Dated: January 5, 2009. 

Ronald K. Lorentzen, 

Acting Assistant Secretary for Import 

Administration. 

Appendix I 

Comment 1: Whether Fushun Jinly’s 

Dumping Margin Should be Based on 

Adverse Facts Available 

Comment 2: Whether Graphite 

Connecting Pins are Covered by the 

Scope of the Investigation 

Comment 3: Whether the Fangda 

Group’s Dumping Margin Should be 

Based on Adverse Facts Available 

Comment 4: Whether Critical 

Circumstances Exist for the Fangda 

Group, Fushun Jinly, the Separate Rate 

Applicants, and the PRC–Wide Entity 

[FR Doc. E9–699 Filed 1–13–09; 8:45 am] 

BILLING CODE 3510–DS–S 

DEPARTMENT OF COMMERCE 

International Trade Administration 

[A–570–890] 

Wooden Bedroom Furniture from the 

People’s Republic of China: Amended 

Final Results Pursuant to a Final Court 

Decision 

AGENCY: Import Administration, 

International Trade Administration, 

Department of Commerce. 


sroberts on PROD1PC70 with NOTICES

B-1

APPENDIX B

HEARING WITNESSES

B-3

CALENDAR OF PUBLIC HEARING

Those listed below appeared as witnesses at the United States International Trade Commission’s

hearing:

Subject: Small Diameter Graphite Electrodes from China

Inv. No.: 731-TA-1143 (Final)

Date and Time: January 6, 2009 - 9:30 a.m.

Sessions were held in connection with this investigation in the Main Hearing Room (room 101), 500

E Street, S.W., Washington, D.C.

In Support of the Imposition of

 Antidumping Duty Order:

Kelley Drye & Warren LLP

Washington, DC

on behalf of

Superior Graphite Co.

SGL Carbon LLC

Edward O. Carney, President and CEO, Superior Graphite Co.

Dennis Shannon, Vice President, Sales, Superior Graphite Co.

Scott Anderson, Vice President, Production; and Business Manager, Graphite 

Electrodes, Superior Graphite Co.

K. Andrew Stinson, Vice President, Technical Sales for the Americas, 

SGL Carbon LLC

Brian Gore, Sales Manager, SGL Carbon LLC

Willy McClintock, President, Northsouth, Inc.

Thomas Danjczek, President, Steel Manufacturers Association

Michael T. Kerwin, Economic Consultant, Georgetown Economic Services

David A. Hartquist )

R. Alan Luberda ) – OF COUNSEL

Grace W. Kim )
B-4

In Opposition to the Imposition of

 Antidumping Duty Order:

Garvey Schubert Barer

Washington, DC

on behalf of

Amerisource-Specialty Products

Ceramark Technology Inc.

Fedmet Resources Corp.

Graphite Electrode Sales, Inc.

M. Brashem Inc.

Beijing Fangda Carbon Tech Co., Ltd.

Chengdu Rongguang Carbon Co., Ltd.

Fangda Carbon New Material Co., Ltd.

Fushun Carbon Co., Ltd.

Sichuan Guanghan Shida Carbon Co., Ltd.

Hefei Carbon Co., Ltd.

Jilin Carbon Import and Export Co.

GES (China) Co., Ltd.

Marvin Brashem, President, M. Brashem, Inc.

Phil Buchanan, Account Manager, M. Brashem, Inc.

Joe Hancock, Purchasing Manager, Wheelabrator Abrasives, Inc.

Greg Wood, Production Manager, Wheelabrator Abrasives, Inc.

Thomas Grosko, Plant Manager, Magotteaux Pulaski

Zhiyong Shi, Procurement Manager–Beijing, M. Brashem, Inc.

Darrell Ruth, Chief Financial Officer, Frog Switch and Manufacturing Company

Ms. Liu, Executive Vice General Manager, Beijing Fangda, and Assistant to the 

Chairman, Fangda Group

Dick West, President, D&B Metals, Inc.

George X.Z. Wang, Ph.D., President, Ceramark Technology, Inc.

Lizbeth R. Levinson )

William Perry ) – OF COUNSEL

Ronald M. Wisla )
C-1

APPENDIX C

SUMMARY DATA

C-3

Table C-1

Small diameter graphite electrodes: Summary data concerning the U.S. market, 2005-07,

January-September 2007, and January-September 2008

* * * * * * *

Table C-2

Large diameter graphite electrodes: Summary data concerning the U.S. market, 2005-07,

January-September 2007, and January-September 2008

* * * * * * *

Table C-3

Total graphite electrodes: Summary data concerning the U.S. market, 2005-07, January-September

2007, and January-September 2008

* * * * * * *
 
D-1

APPENDIX D

RESPONSES TO QUESTIONS CONCERNING SDGE AND LDGE

D-3

U.S. producers were asked the following questions concerning SDGE and LDGE in section II-10 of the

producers’ questionnaire: Since January 1, 2005, has your firm produced large diameter graphite

electrodes? Please describe the differences and similarities between large diameter graphite electrodes

and small diameter graphite electrodes with respect to the following factors: (a) characteristics and

uses--describe the differences and similarities in the physical characteristics and end uses; (b)

interchangeability--discuss the interchangeability in end use of the two products; (c) manufacturing

processes--describe the two processes and include a discussion of the interchangeability of production

inputs, machinery and equipment, and skilled labor; (d) channels of distribution--describe the specific

end use/customer requirements and channels of distribution/market situation in which the products are

sold; (e) customer and producer perceptions--describe any perceived differences in the two products

(e.g., sales/marketing practices); and (f) price--provide a discussion and specific examples of prices for

the two products. Firms were asked to indicate whether product comparisons are “fully” comparable or

the same, i.e., have no differentiation between them; “mostly” comparable or similar; “somewhat”

comparable or similar; “rarely” comparable or similar; “never” or not-at-all comparable or similar; or “no

familiarity.”

* * * * * * *

U.S. importers were asked the following questions concerning SDGE and LDGE in section II-5 of the

importers’ questionnaire: Since January 1, 2005, has your firm imported large diameter graphite

electrodes? Please describe the differences and similarities between large diameter graphite electrodes

and small diameter graphite electrodes with respect to the following factors: (a) characteristics and

uses--describe the differences and similarities in the physical characteristics and end uses; (b)

interchangeability--discuss the interchangeability in end use of the two products; (c) manufacturing

processes--describe the two processes and include a discussion of the interchangeability of production

inputs, machinery and equipment, and skilled labor; (d) channels of distribution--describe the specific

end use/customer requirements and channels of distribution/market situation in which the products are

sold; (e) customer and producer perceptions--describe any perceived differences in the two products

(e.g., sales/marketing practices); and (f) price--provide a discussion and specific examples of prices for

the two products. Firms were asked to indicate whether product comparisons are “fully” comparable or

the same, i.e., have no differentiation between them; “mostly” comparable or similar; “somewhat”

comparable or similar;”rarely” comparable or similar; “never” or not-at-all comparable or similar; or “no

familiarity.”

* * * * * * *
D-4

Purchasers were asked the following questions concerning SDGE and LDGE in question III-9 and III-10

of the purchasers’ questionnaire: Since January 1, 2005, has your firm purchased large diameter graphite

electrodes? Please describe the differences and similarities between large diameter graphite electrodes

and small diameter graphite electrodes with respect to the following factors: (a) characteristics and

uses--describe the differences and similarities in the physical characteristics and end uses; (b)

interchangeability--discuss the interchangeability in end use of the two products; (c) manufacturing

processes--describe the two processes and include a discussion of the interchangeability of production

inputs, machinery and equipment, and skilled labor; (d) channels of distribution--describe the specific

end use/customer requirements and channels of distribution/market situation in which the products are

sold; (e) customer and producer perceptions--describe any perceived differences in the two products

(e.g., sales/marketing practices); and (f) price--provide a discussion and specific examples of prices for

the two products. Purchasers were asked to indicate whether product comparisons are “fully” comparable

or the same, i.e., have no differentiation between them; “mostly” comparable or similar; “somewhat”

comparable or similar; “rarely” comparable or similar; “never” or not-at-all comparable or similar; or “no

familiarity.” If your firm purchase both small diameter graphite electrodes and large diameter graphite

electrodes, are your requests for price quotes for both products made together?

* * * * * * *

Chinese producers and GrafTech (the sole Mexican producer of SDGE) were asked the following

questions concerning SDGE and LDGE in question II-5 of the foreign producers’ questionnaire: Since

January 1, 2005, has your firm produced large diameter graphite electrodes? Please describe the

differences and similarities between large diameter graphite electrodes and small diameter graphite

electrodes with respect to the following factors: (a) characteristics and uses--describe the differences

and similarities in the physical characteristics and end uses; (b) interchangeability--discuss the

interchangeability in end use of the two products; (c) manufacturing processes--describe the two

processes and include a discussion of the interchangeability of production inputs, machinery and

equipment, and skilled labor; (d) channels of distribution--describe the specific end use/customer

requirements and channels of distribution/market situation in which the products are sold; (e) customer

and producer perceptions--describe any perceived differences in the two products (e.g., sales/marketing

practices); and (f) price--provide a discussion and specific examples of prices for the two products. 

Firms were asked to indicate whether product comparisons are “fully” comparable or the same, i.e., have

no differentiation between them; “mostly” comparable or similar; “somewhat” comparable or similar;

“rarely” comparable or similar; “never” or not-at-all comparable or similar; or “no familiarity.”

* * * * * * *
E-1

APPENDIX E

WEIGHTED-AVERAGE DELIVERED SALES PRICES OF PRICING

PRODUCTS IMPORTED FROM NONSUBJECT COUNTRIES

E-3

Table E-1

SDGE: Weighted-average delivered prices and quantities of domestic and product 1 imported

from nonsubject countries, by quarters, January 2005-September 2008

* * * * * * *

Table E-2

SDGE: Weighted-average delivered prices and quantities of domestic and product 2 imported

from nonsubject countries, by quarters, January 2005-September 2008

* * * * * * *

Table E-3

SDGE: Weighted-average delivered prices and quantities of domestic and product 4 imported

from nonsubject countries, by quarters, January 2005-September 2008

* * * * * * *

Table E-4

SDGE: Weighted-average delivered prices and quantities of domestic and product 5 imported

from nonsubject countries, by quarters, January 2005-September 2008

* * * * * * *

F-1

APPENDIX F

ALLEGED EFFECTS OF SUBJECT IMPORTS ON U.S. PRODUCERS’ 

EXISTING DEVELOPMENT AND PRODUCTION EFFORTS,

GROWTH, INVESTMENT, AND ABILITY TO RAISE CAPITAL
 
F-3

The Commission requested U.S. producers to describe any actual or potential negative effects since

January 1, 2005, on their return on investment, growth, investment, ability to raise capital, existing

development and production efforts, or the scale of capital investments as a result of imports of

SDGE from China. Their responses are as follows:

Actual Negative Effects On SDGE Operations

* * * * * * *

Actual Negative Effects On LDGE Operations

* * * * * * *

Anticipated Negative Effects of Imports of SDGE from China

* * * * * * *