# United States Court of Appeals **for the Federal Circuit**

______________________

DOWNHOLE PIPE & EQUI PMENT, L.P., AND DP- MASTER MANUFACTURING CO., LTD., Plaintiffs- Appellants,

v.

UNITED STATES, VAM DRILLING USA,

TEXAS STEEL CONVERSI ONS, INC.,
ROTARY DRILLING TOOL S, AND TMK IPSCO, Defendants

- Appellees,

AND

UNITED STATES STEEL CORPORATION, Defendant.

______________________

2014

- 1225

______________________

Appeal from the United States Court of International
Trade in No. 11

- 00081, Senior Judge Nicholas Tsoucalas.

______________________

Decided: January 29, 2015

______________________

M ARK B. L EHNARDT , Lehnardt & Lehnardt LLC, of Liberty, Missouri, argued for plaintiffs

- appellants.DOWNHOLE PIPE & EQUIPMENT v. US 2

M IKKI C OTTET , Senior Trial Counsel, Commercial Li tigation Branch, Civil Division, United States Department of Justice, of Washington, DC , argued for defendant

appellee United States. With her on the brief were
S TUART F. D ELERY , Assistant Attorney General, J EANNE E. D AVIDSON

, Director, and C LAUDIA B URKE

, Assistant
Director. Of counsel was M ICHAEL T HOMAS G AGAIN , Office
of the Chief Counsel for Import Administration , United States Department of Commerce, of Washington, DC.

R OGER B. S CHAGRIN , Schagrin Associates, of Washin gton, DC, argued for defendants

- ap pellees VAM Drilling USA, Texas Steel Conversion, Inc., Rotary Drilling Tools,
and TMK IPSCO. With him on the brief was J OHN W.
B OHN

.

______________________

Before R EYNA

, L INN

, and W ALLACH

, Circuit Judges

.
W ALLACH

, Circuit Judge

. Appellants Downhole Pipe & Equipment, LP, and DP

Master Manufacturing Co., Ltd. (collectively, “Downhole Pipe”) appeal the decisions of the United States Court of International Trade (“CIT”) (1) affirming the United States Department of Commerce’s (“Commerce”) scope and industry support determinations and (2) sustaining
Commerce’s Final Results of Redetermination Pursuant
to Court Remand. See Downhole Pipe & Equip., LP v.
United States ( Downhole Pipe II ), 94 9 F. Supp. 2d 1288 (Ct. Int’l Trade 2013); Downhole Pipe & Equip. LP v.
U

nited States ( Downhole Pipe I ), 887 F. Supp. 2d 1311 (Ct. Int’l Trade 2012); see also Drill Pipe F rom the People’s Republic of China , A

- 570

- 965 (Dep’t of Commerce May 13, 2013) (final results of redetermination pursuant to court remand) (P ublic J oint A ppen dix (“P.J.A.”) 2388

– 406) (“ Remand Results ”); Drill Pipe From the People’s Republic of China , 75 Fed. Reg. 4

, 531 (Dep’t of Commerce Jan. 28, 2010) (initiation of antidumping duty investigations)DOWNHOLE PIPE & EQUIPMENT v. US 3

(“ Initiation ”). Because Commerce’s determinations were supported by substantial evidence and were not otherwise contrary to law, this court affirms.

B ACKGROUND

I. Facts

Downhole Pipe is a United States importer of “drill pipe” produced by DP

- Master Manufacturing Co., Lt d. (“ DP

- Master”) , a Chinese producer. Drill pipe is a specia lize d high

- strength iron alloy tube, used in oil

- drilling applications, and is manufactured in three stages: first,

se amless tubes called “green tube ” are produced from raw steel; second, the manufacturer uses complex processes to “upset” and heat

- treat green tube to thicken the ends and increase the yield strength to the desired American Petr oleum Institute (“API”) grade; third, the manufacturer
friction- welds a specialized “tool joint” to the en ds of the
heat

- treated and upset tu be to complete the drill pipe.
While green tube is the primary input in the production of drill pipe, it can also be processed into other “oil country tubular goods.” Oil country tubular goods, which consist primarily of casing and tubing, are used in connection
with the transport of oil and gas, while drill pipe is pr imarily used in drilling

. II. Proceedings

In 2009, Commerce received a petition from several domestic drill pipe producers, including Appellees VAM
Drilli ng USA, Texas Steel Conversion, Inc., Rotary Dril ling Tools, and TMK IPSCO (collectively, “Petitioners”), seeking imposition of antidumping and countervailing duties on drill pipe from the People’s Republic of China (“China”)

. Drill Pipe From the People’s Republic of China

, No. A

- 570

- 965 ( Dep’t of Commerce Dec. 31, 2009) (petition for the imposition of antidumping and countervailing duties) (P.J.A. 56

– 230 ) (“ Petition ”)

. Some of the petitio ners produce green tube for drill pipe, while others produceDOWNHOLE PIPE & EQUIPMENT v. US 4

finish ed drill pipe. Prior to Commerce’s initiation of the antidumping investigation, Downhole Pipe objected to the proposed scope of the investigation, arguing green tube should not be included within the scope

, because it was already covered by an on going inv estigation into oil country tubular goods, and Commerce should disregard green tube production for purposes of calculating domestic industry support.

After considering these objections, Commerce revised the scope of the investigation in the Initiation , s pecifying “‘[t]he scope does not include . . . unfinished tubes for casing or tubing covered by any other antidumping or countervailing duty order.’” Downhole Pipe I , 887 F. Supp. 2d at 1316 (citation omitted); Initiation , 75 Fed. Reg. at 4,535. Commerce also found sufficient dom estic industry support for the P etition, as calculated using the revised scope. Therefore, in 2010, Commerce initiated the antidumping investigation of drill pipe from China.

In its Preliminary Determination , Commerce dete rmined drill pipe from China wa s, or was likely to be, sold
in the United States at less

- than

- fair value. Drill Pipe

F

rom the People’s Republic of China , 75 Fed. Reg. 51,004 (Dep’t of Commerce Aug. 18, 2010) (preliminary determ ination of sales at less than fair value and affirmative determination of critical circumstances, and postpon ement of final determination) (“ Preliminary Determin ation ”). While Commerce maintained the scope as defined
in the Initiation over Downhole Pipe’s objections, in the
Prelimina ry Determination it stated, given “concerns regarding the imprecision of the definition of ‘green tubes suitable for drill pipe’ currently contained in the scope,” it would “request additional information regarding chara cteristics distinguishing green tube for drill pipe from green tube for casing and tubing covered under the orders on [oil country tubular goods from China].” Id. at 51,006. Further,DOWNHOLE PIPE & EQUIPMENT v. US 5

[u]nless specific characteristics are provided which distinguish between green tube for drill pipe and gree n tube for casing and tubing, all green tubes . . . will be removed from the scope of the . . . investigations on drill pipe from [China]
and will instead be considered as covered under the existing [orders on oil country tubular goods from China].

Id.

Com merce issued its Final Determination on January 11, 2011, continuing to find drill pipe from China was being, or was likely to be, sold in the United States at
less- than

- fair value. Drill Pipe F rom the People’s Repu blic of China , 76 Fed. Reg. 1

, 966 (Dep’t of Commerce Jan. 11, 2011) (final determination of sales at less

- than

- fair value and critical circumstances) (“ Final Determination ”), and accompanying Issues & Decision Memorandum (“ Issues & Dec. Mem. ”) (P.J.A. 1890

– 938).

For the Final Determination , Comm erce “developed characteristics for drill pipe green tubes based on nume rous submissions of factual data from parties regarding the physical and chemical characteristics of drill pipe and drill pipe green tubes.” Issues & Dec. Mem. at 11. Thus,
“Commerce narrowed the scope by adding three physical criteria to the description of subject green tube.” Dow nhole Pipe I , 887 F. Supp. 2d at 1317. Specifically, Co mmerce narrowed the scope to green tube: (1) that is seamless; (2) that has a certain outer diamete r; and (3)
that contain s specific percentages of molybdenum and
chromium. Issues & Dec. Mem. at 11. Thus, the scope specified in the Final Determination reads:

The products covered by the investigation are steel drill pipe, and steel drill collars, wheth er or not conforming to [API] or non

- API specifications. Included are finished drill pipe and drill collars without regard to the specific chemistry of theDOWNHOLE PIPE & EQUIPMENT v. US 6

steel ( i.e., carbon, stainless steel, or other alloy steel), and without regard to length or outer d iameter. Also included are unfinished drill collars (including all drill collar green tubes) and unfinished drill pipe (including drill pipe green tubes, which are tubes meeting the following description: seamless tubes with an outer diameter of less tha n or equal to 6 5⁄8 inches (168.28 millimeters), co ntaining between 0.16 and 0.75 percent moly bdenum, and containing between 0.75 and 1.45 percent chromium)

. The scope does not include . . . unfinished tubes for casing or tubing covered by any other antidumping or countervailing duty o rder.

Final Determination , 76 Fed. Reg. at 1

, 967 (emphasis added).

As part of its Final Determination , Commerce also calculated a surrogate value for the green tube input as one of the factors of production. Two sources were on the record to serve as surrogate data: (1) price quotes printed in a trade publication called Metal Bulletin Research for grades J and K casing and tubing (“J/K 55”) and (2) the average transaction prices paid for products imported into
India unde r the Harmonized Tariff Schedule of India (“IHTS”) subheadings 7304.23 and 7304.29. Commerce ultimately determined the best available information was the average Indian import prices for sales of merchandise under these IHTS subheadings. Using this data, Co mmerce calculated a surrogate value of $2,511.67 for the green tube input.

Downhole Pipe appealed several of Commerce’s d eterminations to the CIT, including its inclusion of green tube within the scope of the investigation and in the industry support calculation, as well as its choice of the
surrogate data used to value the green tube in put. In
Downhole Pipe I , the CIT rejected Downhole Pipe’s scopeDOWNHOLE PIPE & EQUIPMENT v. US 7

arguments , reasoning Commerce had discretion to dete rmine scope and could not reconsider industry support after initiation of the investigation

. The CIT also r emanded the Final Determination to Commerce with instructions to reconsider the surrogate values used for green tube. In particular, the CIT found Commerce had
failed to address the InfoDrive India (“ InfoDrive ”) import data Appellants had placed on the administrative record that called into question Commerce’s finding that green
tube entered India under IHTS subheadings 7304.23 and 7304.29. The CIT acknowledged data from the IHTS subheadings might be the best available information, but
it could not affirm the Final Determination on the basis of the explanation provided by Commerce.

On remand, Commerce exam ined all other potential surrogate values for green tube on the record, including: (1) import statistics for goods imported into India under IHTS categories 7304.23, 7304.29, and 7304.59; (2) Metal
Bulletin Research price data for J/K 55 and for “P110”; (3) adjusted value data for alloy steel billets processed into green tube provided by Appellants; and (4) adjusted value data for seamless tubes provided by Appellants. Commerce found the price data for products entered under IHTS 7304.59 (as opposed to I HTS 7304.23 and 7304.29) was the best available information on the record because it was most representative of the green tube used for drill pipes, contemporaneous with the period of inve stigation, duty and tax exclusive, publicly available, and
represent ed a broad market average. Commerce also confirmed its analysis with a National Import Specialist at United States Customs and Border Protection (“Cu stoms”). Although in its draft remand results Commerce
used data from both IHTS 7304.59.10 and IHTS

7304. 59.20, in its final Remand Results Commerce based
the surrogate value for green tube on the average unit
value of entries made under IHTS 7304.59.20 alone.DOWNHOLE PIPE & EQUIPMENT v. US 8

On return to the CIT, Appellants argued the Remand
Results were unsupported by substantial evidenc e and
were otherwise not in accordance with law . Therefore

, Downhole Pipe asked the CIT to once again remand the issue of the surrogate values used to value the green tube.

In Downhole Pipe II , the CIT sustained the Remand
Results

.
Downhole Pipe appeals. This court has jurisdiction pursuant to 28 U.S.C. § 1295( a)(5 ) (2012).

D ISCUSSION

I. Standard of Review

This court reviews the decisions of the CIT de novo, “apply[ing] anew the same standard used by the [CIT].”
Mittal Steel Point Lisas Lt d. v. United States , 548 F.3d 1375, 1380 (Fed. Cir. 2008) (internal quotation marks and citation omitted) . Under that standard, this court must uphold Commerce’s determinations unless they are “u nsupported by substantial evidence on the record, or ot herwi se not in accordance with law.” 19 U.S.C. § 1516a(b)(1)(B)(i) (2006)

. “Although such review amounts to repeating the work of the [CIT], we have noted that ‘this court will not ignore the informed opinion of the [CIT].’” Diamond Sawblades Mfrs. Coal. v. United
States , 612 F.3d 1348, 1356 (Fed. Cir. 2010) (quoting Suramerica de Aleaciones Laminadas, C.A. v. United
States , 44 F.3d 978, 983 (Fed. Cir. 1994)); see also Cleo
Inc. v. United States , 501 F.3d 1291, 1296 (Fed. Cir. 2007) (“When performing a substantial evidence review, . . . we give great weight to the informed opinion of the [CIT]. Indeed, it is nearly always the starting point of our anal ysis.”) (internal quotation marks and citation omitted)

.
Substantial evidence is defined as “more than a mere scintilla,” as well as evidence that a “reasonable mind might accept as adequate to support a conclusion.” Co nsol. Edison Co. of N.Y. v. NLRB , 305 U.S. 197

, 229 (1938).DOWNHOLE PIPE & EQUIPMENT v. US 9

This court’s review is limited to the record before Co mmerce in the particular review proceeding at issue and
includes all “ evidence that supports and detracts ” from
Commerce’s conclusion. Sango Int’l L.P. v. United States

, 567 F.3d 1356, 1362 (Fed. Cir. 2009). An agency finding may still be supported by substantial evidence even if two
inconsistent conclusions can be drawn from the evidence

. Consolo v. Fed. Mar. Comm’n , 383 U.S. 607, 620 (1966).

II. Legal Framework

The United States imposes duties on foreign

- produced goods sold in the United States at less

- than

- fair value (“antidumping duties”), 19 U.S.C. § 1673(1), or that benefit from subsidies provided by foreign governments (“countervailing duties”), id. § 1671(a)(1). Commerce is responsible for investigating whether there have been, or are likely to be, sales at less

- than

- fair val ue or whether a subsidy has been provided, id. §§ 1673(1), 1671(a)(1),
while the International Trade Commission determines whether imported merchandise materially injures or threatens to materially injure the pertinent domestic industry, id. §§ 1673d(b)(1) , 1671d(b)(1). “If both inqui ries are answered in the affirmative, Commerce issues the relevant antidumping and countervailing duty orders.” Duferco Steel, Inc. v. United States , 296 F.3d 1087, 1089 (Fed. Cir. 2002). The orders contain a description of the merchandise that is covered by the order, called the scope. 19 U.S.C. §§ 1671e(a)(2), 1673e(a)(2).

Antidumping investigations are typically initiated by a petition filed with Commerce by a domestic industry. Duferco Steel , 296 F.3d at 1089. The peti tion defines the initial scope of the investigation. Id. After a petition is received, several statutory criteria must be met before Commerce may initiate an investigation, including d etermining whether the petition was filed on behalf of the
domestic in dustry, 19 U.S.C. § 1673a(c)(1)(A)(ii), (c)(2), and whether there is domestic industry support for theDOWNHOLE PIPE & EQUIPMENT v. US 10

petition, id. § 1673a(c)(4). To determine whether there is industry support, Commerce must determine whether domestic producers or workers who support t he petition “account for at least 25 percent of the total production of the domestic like product.” Id. § 1673a(c)(4)(A)(i). If Commerce determines the petition lacks industry support, it “shall dismiss the petition [and] terminate the procee ding.” Id. § 1673a(c)(3). If, however, Commerce “makes a determination with respect to initiating an investigation, the determination regarding industry support shall not be
reconsidered .” Id. § 1673a(c)(4)(E) (emphasis added).

Once an antidumping investigation has been initia ted, to determine whether foreign goods are being sold or

are likely to be sold in the United States at less

- than

- fair value, id. § 1673, Commerce compares the export price (or constructed export price) of a foreign producer’s sales with
“norma l value” (the price in the foreign market), id. § 1677b(a). If the price of an item in the foreign market (normal value) is higher than the price for the same item in the United States (export price), dumping has occurred.
Id. § 1677(35)(A) (The antidumping duty margin is “the amount by which the normal value exceeds the export price or constructed export price of the subject mercha ndise.”).

Further, if Commerce considers the exporting country a “nonmarket economy country,” 1 it determines normal

1 A “nonmarket economy country” is “any foreign country that [Commerce] determines does not operate on market principles of cost or pricing structures, so that sales of merchandise in such country do not reflect the
fair value of the merchandise.” 19 U.S.C. § 1677(18)(A). “Because it deems China to be a nonmarket economy country, Commerce generally considers information on
sales in China and financial information obtained from Chinese producers to be unreliable for determining, underDOWNHOLE PIPE & EQUIPMENT v. US 11

value by valuing the “factors of production” used in pr oducing the merchandise in a comparable market econ omy 2 to come up with “surrogate values.” See id. § 1677b(c)(1) (B) . In doing so, Commerce “attempt[s] to construct a hypothetical market value of that product ” in the nonmarket economy. Nation Ford Chem. Co. v. Uni ted States , 166 F.3d 1373, 1375 (Fed. Cir. 1999). Thus, Commerce must value the factors of production “to the extent possible . . . in one or more market economy cou ntries that are —(A) at a level of economic development comparable to that of the nonmarket economy country

, and (B) significant producers of comparable merchandise. ”
19 U.S.C. § 1677b(c)(4)(A)

– (B)

.
The statute also directs Commerce to value the factors of production “based on the best av ailable information regarding the values of such factors in a market economy country.” Id. § 1677b(c)(1) (B) (emphasis added). Co mmerce has discretion to determine what constitutes the best available information, as this term is not defined by

statute. Q VD Food Co. v. United States , 658 F.3d 1318, 1323 (Fed. Cir. 2011). However, “Commerce generally selects, to the extent practicable, surrogate values that are publicly available, are product

- specific, reflect a broad market average, and are contemporaneou s with the period of review.” Qingdao Sea

- Line Trading Co. v.
United States , 766 F.3d 1378, 1386 (Fed. Cir. 2014).

19 U.S.C. § 1677b(a), t he normal value of the subject
merchandise.” Shanghai Foreign Trade Enters. Co. v.
United States , 318 F. Supp. 2d 1339, 1341 (Ct. Int’l Trade 2004).

2 Here, “Commerce selected India as the primary surrogate country, and used Indian data to calculate

surr ogate values for two key drill pipe inputs relevant to
this case.” Downhole Pipe I , 887 F. Supp. 2d at 1316.DOWNHOLE PIPE & EQUIPMENT v. US 12

III. Commerce Properly Included Green Tube in the Scope of the Investigation and in the Calculation of Industry Support

Appellants challenge the lawfulness of including green tube within the scope of the investigation, and consequently of including green tube in the industry support calculation. In Downhole Pipe I , the CIT rejected Downhole Pipe’s scope arguments, reasoning (1) Co mmerce has d iscretion to define the scope of the investig ation, and (2) Commerce is barred by statute from reconsidering industry support after the initiation of an investigation. Downhole Pipe I , 887 F. Supp. 2d at 1319 (Downhole Pipe ’s “sole argument

— that some green tube used to produce [oil country tubular goods] meet the technical specifications of the Final Determination and are thus subject to two antidumping orders

— has little bearing on Commerce’s decision to initiate the investig ation.”). In support of its conclusions, the CIT pointed to three prior International Trade Commission determin ations, which describe “why technical specifications and customer expectations led it to treat green tube for drill pipe as a ‘distinct like product’ from green tube for [oil country tubular goods].” Id. at 1320 (citation omitted)

. Therefore, the CIT concluded, “[g]iven the end

- use exce ption and the extensive evidence showing a distinction in channels of distribution, customer expectations, and technical specifications, it wo uld not be appropriate for this court to usurp Commerce’s exercise of discretion in defining the scope of the Initiation .” Id.

Nonetheless, on appeal

, Downhole Pipe continues to argue that Commerce may not include products within the scope of an investigation that are already covered by the scope of another investigation or order. As to the three criteria identified by Commerce as distinguishing green tube for drill pipe from green tube for oil country tubular goods

— i.e., that green tube for drill pipe (1) is seamless, (2) has an outside diameter of 6 5/8 inches orDOWNHOLE PIPE & EQUIPMENT v. US 13

less, and (3) has 0.16%

– 0.75% molybdenum and 0.75%

– 1.45% Chromium

— Downhole Pipe argues the record lacks substantial evidence to support these three criteria

. Further, Appellants argue , “[b]ecause these three criteria do not distinguish drill

- pipe green tube from [oil country tubular goods] green tube, the same green tube is impe rmissibly covered by two antidumping duty orders.” Appellants’ Br. 30.

In support, Appellants rely on record evidence that purportedly establishes that each of these three criteri a may apply to green tube used to produce oil country tubular goods. Specifically, as to the first criterion, Appe llants argue that while all green tube used for drill pipe must be seamless, some green tube used to produce oil country tubular goods is also seamless. As to the second criterion, Appellants note some oil country tubular goods
use green t ube with an outside diameter of less than or equal to 6 5/8 inches. Finally, regarding chemistry, Appellants contend there are no API specifications for

“ minimum alloy requirements for casing, tubing, and drill pipe. ” Id. at 31.

In addition, Appellants a rgue that without the incl usion of green tube production volume in its industry support calculation, the Petition lack s the requisite indu stry support. Appellants’ Br. 32 (“A cursory review of the industry support calculation after removing green tube

pro ducers indicates that petitioners would not satisfy the required 25% industry

- support threshold.”). Therefore, Appellants insist the industry support calculation must be remanded. As to the statutory bar against revising this calculation post

- initiation, Appellants contend it “properly raised this scope/industry support issue prior to the
Initiation .” Id. at 34.

These arguments are unavailing because Commerce reasonably included green tube within the scope of the investigation . First, substantial eviden ce supports Co m-DOWNHOLE PIPE & EQUIPMENT v. US 14

merce’s identification of three physical characteristics that distinguish green tube for drill pipe from that i ntended for oil country tubular goods. As Commerce e xplained, the first criterion (that green tube for drill pipe must be seamless) was “based on Petitioners’ comments and submission of technical specifications.” Issues & Dec.
Mem. at 11. As to the second criterion, that the drill pipe green tube must have a certain outer diameter, Co mmerce explained this was “based on DP

- Master G roup’s submission of [API] specifications for drill pipe.” Id. As to the final criterion regarding the green tube’s chemical composition, this was “based on Petitioners’ submission of declarations from experienced drill pipe engineers who direct the purc hase of green tubes for drill pipe based on specific physical and chemical requirements.” Id. While Appellants invite this court to reweigh this evidence, this court may not do so. See Trent Tube Div., Crucible Mat erials Corp. v. Avesta Sandvik Tube AB

, 975 F.2d 807, 815 (Fed. Cir. 1992) (“It is not for this court on appeal to reweigh the evidence or to reconsider questions of fact anew.”).

I t is important to note that Appellants have failed to identify any green tube intended for oil country tubular

goo ds that satisfies all three of these criteria. As the Government points out, “[i]n order to be covered by the Order here, the green tube must satisfy all three of the requirements established by Commerce.” United States’ Br. 19. Appellants have not called into question Co mmerce’s conclusion that, “[w]hile the DP

- Master Group has provided specifications for certain [oil country tubular goods] that overlap in some characteristics with drill pipe, no specifications for [oil country tubular goods] have been placed on the record that meet all of the criteria for drill pipe green tube.” Issues & Dec . Mem. at 11. Even if Downhole Pipe had been able to do so, moreover, Co mmerce added an explicit exception to exclude any such overlapping goods: “The scope does not include . . . unfi n-DOWNHOLE PIPE & EQUIPMENT v. US 15

ished tubes for casing or tubing covered by any other antidumping or countervailing duty order.” Final Dete rmination , 76 Fed. Reg. at 1

, 967. As the CIT pointed out, Downhole Pipe did “not analyze the purported overlap in light of t his potentially remedial exception,” Downhole Pipe I , 887 F. Supp. 2d at 1319, and ma kes no attempt to do so before this court.

As to Downhole Pipe’s insistence that industry su pport must be recalculated using a revised scope, Appe llants have not overcome the statutory obstacle to doing so. That is, while 19 U.S.C. § 1673a(c)(4)(E) provides that any potential interested party may submit comments or information on the issue of industry support prior to the initiation of an investigation, it explicitly states “[a]fter [Commerce] makes a determination with respect to init iating an investigation, the determination regarding industry support shall not be reconsidered.” 19 U.S.C. § 1673a(c)(4)(E). Given this court’s finding that Downhole Pipe has failed to demo nstrate Commerce erred in inclu ding green tube within the scope, this statutory bar means
the contention that Commerce must redetermine whether there is sufficient industry support necessarily fails. This is not to say a party may not challenge whether it s goods properly fall within the scope, 3 but only that the industry support calculation is not reviewable under these circu mstances.

Accordingly, Commerce’s inclusion of green tube in the scope of the investigation and in the calculation of

3 Indeed, pursuant to 19 C.F.R. § 351.225 (2012) , a party can request a scope determination to determine whether its merchandise falls within the scope of an
order. Here, as the CIT observed

, “DP

- Master does not export green tube to the U.S., and neither it nor any party below have requested a scope determination.” Downhole Pipe I , 887 F. Supp. 2d at 1318.DOWNHOLE PIPE & EQUIPMENT v. US 16

industry suppor t was supported by substantial evidence and was not contrary to law.

IV . Substantial Evidence Supports Commerce’s Selection of the Surrogate Value for Green Tube

Appellants also challenge the lawfulness of Co mmerce’s selection of a surrogate value for valu ing green tube, as redetermined following the remand by the CIT.

In Downhole Pipe I , the CIT ordered a remand because “Commerce’s rebuttal of each of [Downhole Pipe’s] four alternative surrogates . . . d[id] not cure its inadequate explanation of its reli ance upon the IHTS data,” and “i ts failure here to explain evidence apparently contrary to a finding central to its determination leaves the court without the means necessary to affirm it as supported by
the record.” Downhole Pipe I , 887 F. Supp. 2d at 13 25 (internal citations omitted) . The CIT noted on remand, “Commerce [was] not barred from selecting the IHTS
data ,” but it was required to “ explain why such data is more representative of the price for drill pipe green tube than other potential surrogate values in light of InfoDrive data that appears to demonstrate that [IHTS] 7309.23 and 7309.29 do not actually ‘capture’ green tube and are highly distorted by expensive, finished tubular goods.” Id.

As noted, on remand Commerce examined four pote ntial d ata sources for valuing green tube: (1) import stati stics for goods imported into India under IHTS categories 7304.23, 7304.29, and 7304.59; (2) Metal Bulletin R esearch price data for J/K 55 and P110; (3) adjusted value data for alloy steel billets process ed into green tube; and (4) adjusted value data for seamless tubes. Commerce then determined it had incorrectly found that IHTS 7304.23 and 7304.29 were the proper IHTS sub headings for green tube, and instead determined that IHTS 7304.59.20 was the proper subheading.

In Downhole Pipe II , the CIT affirmed the Remand
Results , holding “[a]lthough IHTS 7304.59.20 does notDOWNHOLE PIPE & EQUIPMENT v. US 17

perfectly cover [Downhole Pipe ’s] [drill pipe green tubes], Commerce’s decision was reasonable nonetheless given the record support for IHTS 7304.59.20 and the relative
weakness of the alternative values.” Downhole Pipe II

, 949 F. Supp. 2d at 1295. Specifically, the CIT held,
“Commer ce reasonably determined that IHTS 7304.59.20 import data satisfied more of its selection criteria than the flawed alternatives on the record,” id. at 1297, and, in contrast to the alternate surrogate values on the record,
“Commerce found that the IHTS 7304.59.20 data is ‘co ntemporaneous with the [period of investigation], repr esent[s] a broad market average, [is] tax and duty exclusive, and [is] publicly available, thus comporting with [ Commerce’s ] selection criteria.’” Id. (citations omitted). For these reasons, the CIT held Commerce reasonably determined that data from IHTS 7304.59.20
was the best available information on the record and Commerce “reasonably rejected” the alternative surrogate
values. Id. at 1296

– 97 (citations omitted).

On appeal, Downh ole Pipe challenges Commerce’s s election of the surrogate value for green tube on three grounds. First, Appellants contend Commerce improperly rejected the alternative surrogate values on the record, and that its legal analysis in support of selecting IHT S 7304.59.20 was insufficient. Specifically, Appellants characterize “Commerce’s legal analysis to support selec ting IHTS 7304.59.20” as “a one

- sentence assertion regar ding classification under IHTS, which Commerce supported
with a two

- sentence memo reporting some sort of confi rmation from [Customs].” Appellants’ Br. 43. They ther efore claim that when analyzing the competing IHTS subheadings on the record, Commerce improperly “i gnore[d] basic legal principles

— such as [General Rule of Interpretation] 2(a)

— which require some analysis before
dismissal.” Id. In so arguing, Appellants concede “the process of selecting [surrogate values] is necessarily imprecise,” but nonetheless argue that “Commerce mustDOWNHOLE PIPE & EQUIPMENT v. US 18

strive for accuracy in value to comply with its obliga tion to calculate margins as accurately as possible.” Id. at 24

– 25.

This court declines Appellants’ invitation to reweigh the evidence in order to reject Commerce’s conclusions,
which were well

- supported and fully explained. See id. at

44

– 49 (challenging each of Commerce’s conclusions r egarding the alternative surrogate values on the record and offering Appellants’ own interpretations). Regarding
Downhole Pipe ’s argument that Commerce’s “legal anal ysis” of the competing tariff headings was insufficient
b ecause Commerce failed to employ the General Rules of Interpretation of the Harmonized Tariff Schedule as part

o f its evidentiary determination , this is not a customs classification case. Commerce was not required to engage in a classification analysis to determine which IHTS subheading contained entries of drill pipe green tube; rather, it was required to determine which of the compe ting sub headings constituted the best available info rmation for valuing the green tube input. In addition, as the CIT point ed out, Appellants “do not cite any legal authority demonstrating that Commerce must conduct a full classification analysis when considering import data from a particular foreign tariff heading as a surrogate value,” and Appellants “provide virtually no legal analysis contravening Commerce ’ s selection.” Downhole Pipe II

, 949 F. Supp. 2d at 1293.

As to its selection process, in the Remand Results Commerce explained it used “a process of elimination” to select IHTS subheadings 7304.59.10 and 7304.59.20
becau se “[c]ategorization of products under the HTS is a process of elimination.” Remand Results at 5. Using this process, Commerce explained it rejected IHTS 7304.23 and 7304.29 because the former captures processed semi

finished drill pipe and the latter ca ptures semi -finished casing and tubing, which are not input s for drill pipe. Therefore, these headings were “no longer the best avai l-DOWNHOLE PIPE & EQUIPMENT v. US 19

able information on the record.” Id. at 7. Commerce further explained, “after examining all possible subcat egories under I HTS heading 7304, the process of elimina ting the other items entering under these headings demonstrates that categories 7304.59.10 and 7304.59.20 cover drill pipe green tube as defined in the scope of the
Order .” Id. at 5. Of these two subheadings, Com merce found the latter better represented green tube because
further classification under these subheadings was based

on tube diameters, and 7304.59.2 0 better reflected the
diameter of the green tube covered by the O rder. Id.

To the extent Downhole Pipe r equests this court to reweigh Commerce’s findings with regard to each hea ding, this court may not do so. “This court’s duty is ‘not to
evaluate whether the information Commerce used was the best available, but rather whether a reasonable mind
could conclu de that Commerce chose the best available
information.’” Zhejiang DunAn Hetian Metal Co. v. United States , 652 F.3d 1333, 1341 (Fed. Cir. 2011) (quo ting Goldlink Indus. Co. v. United States , 431 F. Supp. 2d 1323, 1327 (Ct. Int’l Trade 2006)). In light of Commerce’s
well- reasoned explanation of its selection process, this
court finds Commerce’s selection of data from IHTS 7304.59.20 was supported by substantial evidence.

As to Appellants’ argument that Commerce unreaso nably rejected the alternative surrogate values on the record, Commerce appropriately evaluated each of the alternatives on the record and provided an ample expl anation as to why it should be rejected. With regard to the price data for J/K 55 from the Metal Bulletin Research

, Commerce explain ed this data was not the best available information on the record because: (1) “it is not contemp oraneous;” (2) “ it represents only a single month of price data;” (3) “J/K 55 cannot be used to produce drill pipe;” and (4) J/K 55 “is at best comparable [to green tube], differing in alloying element content and production
methods.” Remand Results at 8. Moreover, the J/K 55DOWNHOLE PIPE & EQUIPMENT v. US 20

data did not reflect actual sales prices, but rather offer prices. Id. at 5 –6. Commerce reasonably concluded the J/K 55 data did not satisfy its selection criteria. See Qingdao Sea -Line , 766 F.3d at 1386 (“Commerce genera lly selects, to the extent practicable, surrogate values that are publicly available, are product

- specific, reflect a broad market average, and are contemporaneous with the period of review.”).

Commerce rejected the P110 price data from the Me tal Bulletin Research for similar reasons, finding P 110 is not representative of green tube because it is a finished oil country tubular good product that cannot be used as an input for drill pipe. Remand Results at 9. Additiona lly, the P 110 data was based on offer prices and only
contained one month of pricing information. Id. As compared to the data from IHTS 7304.59.20, Commerce reasonably found these alternatives were not the best available information for valuing the green tube input.

Similarly, Commerce reasonably explained why the adjusted value data offered by Downhole Pipe for alloy steel billets processed into green tube and for seamless
tubes were not the best available information as co mpared to the data from IHTS 7304.59.20. Specifically,
Commerce found the record lacked sufficient information to adjust the values for the required alloying costs and that calculating such adjustments required proprietary
information. Id. at 9

– 11. Because Commerce’s regul ations direct it to use “publicly available information,” 19 C.F.R. § 351.408(c)(1), Commerce rejected these adjusted
values. Thus, Commerce supported with substantial
evidence its determinations that it had selecte d the best
available information and reasonably rejected the alte rnatives pro posed by Downhole Pipe

. Appellants also argue Commerce’s choice of a surr ogate value for green tube is “aberrantly high” and ther efore outside the bounds of commercial reality. A ppellants’DOWNHOLE PIPE & EQUIPMENT v. US 21

Br. 41. Specifically, Downhole Pipe claims Commerce’s choice of the average price for goods entered under IHTS 7304.59.20 resulted in a surrogate value of $4,978.11 for green tube, which is “aberrantly high” because it is almost double the value of the $2,511.67 figure Commerce used
in the Final Determination based on goods entered under IHTS 7304.23.90. Appellants point out IHTS 7304.59.20 is a basket category for alloy seamless tubes, while the previously- selected IHTS 7304.23.90 includes bot h fi nished and unfinished drill pipe. Therefore, Appellants argue, “[u]nder the basic principle that an input should not be valued more than the finished product, Commerce
failed to select an accurate [surrogate value]

, ” and “[e]xacerbating Commerce’s error is uncontroverted industry expert testimony establishing the value of green tube at approximately 30% of the value of finished drill pipe.” Id. at 25. In support, Downhole Pipe points to the InfoDrive data for entries made under IHTS 7304.59.10 and 7304.59.20 that Appellants argue “conclusively
demonstrated that there were no entries of drill

- pipe green tube under IHTS 7304.59.10, and no entries of d[r]ill pipe green tube in at least 60% of entries und er IHTS 7304.59.20.” Id. at 46.

As the Government notes , “[a]lthough Downhole su cceeds in creating a stark comparison, Downhole fails to do so using substantiated reference points.” United States’ Br. 41. In particular, while Downhole Pipe argues the

va lue of a finished drill pipe should not exceed the value of an individual input, like green tube, its comparison relies on the incorrect assumption that IHTS 7304.59.20 covers green tube exclusively and IHTS 7304.23.90 covers
semi

- finished or finished dril l pipe exclusively. Appe llants fail to provide any evidence in support of this prop osition. For example, Appellants state “IHTS 7304.59.20 most likely also lacked entries of drill

- pipe green tube,” citing for support its own comments submitted in r espons e to the draft remand results and the InfoDriveDOWNHOLE PIPE & EQUIPMENT v. US 22

data . Appellants’ Br. 45 (citing P.J.A. 2289

– 91, 2305

– 26 ) (emphasis added). As noted above, Commerce provided substantial evidence to support its finding that the data
from IHTS 7304.59.20 was the best available information
on the record.

Finally, Downhole Pipe argues Commerce erred in r elying on a memo from the National Import Specialist to confirm its selection of IHTS 7304.59 as the appropriate heading for drill pipe green tube. Specifically, Appellants claim they “expose[] six significant flaws, that cannot be filled in by Commerce’s four post hoc attempts in the
Remand to bolster the quality of the [National Import Specialist’s] Memo.” Id. at 49. These alleged flaws i nclude (1) that Appellants cannot determine whether Commerce contacted the National Import Specialist by “email, letter, fax, telephone, over coffee, or through a friend”; (2) there is no indication that Commerce supplied the scope language to the National Import Specialist for
her conside ration; (3) there is no indication that a discu ssion of the scope language occurred, and therefore there is no record evidence establishing what the National Import Specialist considered prior to confirming Commerce’s selection; (4) “there is no indication that the [National Import Specialist] has any training regarding how to classify imports under IHTS categories— or whether the [National Import Specialist] had any relevant training at all”; (5) the memo does not indicate whether Customs
evaluated other IH TS categories or considered legal principles regarding how to classify drill pipe green tube; and (6) there is no indication of how Customs “confirmed”
Commerce’s IHTS classification decision. Id. at 49

– 52.

Given Commerce’s well

- reasoned explanation why d ata from IHTS 7304.59.20 constituted the best available information for valuing green tube, this court need not entertain this argument. As the CIT correctly noted : first, “Commerce did not rely solely on the [National Import Specialist] Memo in its analy sis . . . [and] explained thatDOWNHOLE PIPE & EQUIPMENT v. US 23

it ‘confirmed’ [its] analysis with the [Customs] official ,”
and second, this “ argument is entirely conjectural. [A ppellants] insist that the [National Import Specialist] Memo contains several possible flaws, but fail to iden tify any evidence in the record supporting their assertions.” Downhole Pipe II , 949 F. Supp. 2d at 1296; see also Pet itioners’ Br. 31 (“The bulk of Downhole’s argument co nsists of totally unsupported speculation that when contacted by Commerce, . . . a se nior [Customs] official, incompetently rendered an informal opinion without reviewing any of the necessary documents or understan ding any of the legal principles involved. A presumption of correctness surrounds agency proceedings.”). Substantial
evidence supports C ommerce’s selection of the surrogate value for green tube

.
C ONCLUSION

For the foregoing reasons, the decision of the United
States Court of International Trade is

AFFIRMED