Federal Register / Vol. 66, No. 94 / Tuesday, May 15, 2001 / Notices 26831

references to the provisions codified at

19 CFR part 351 (2000).

Scope of Review

Imports covered by this review are oil

country tubular goods, hollow steel

products of circular cross-section,

including oil well casing, tubing, and

drill pipe, of iron (other than cast iron)

or steel (both carbon and alloy), whether

seamless or welded, whether or not

conforming to American Petroleum

Institute (API) or non-API

specifications, whether finished or

unfinished (including green tubes and

limited service OCTG products). This

scope does not cover casing, tubing, or

drill pipe containing 10.5 percent or

more of chromium. The OCTG subject to

this order are currently classified in the

Harmonized Tariff Schedule of the

United States (HTSUS) under item

numbers: 7304.21.30.00, 7304.21.60.30,

7304.21.60.45, 7304.21.60.60,

7304.29.10.10, 7304.29.10.20,

7304.29.10.30, 7304.29.10.40,

7304.29.10.50, 7304.29.10.60,

7304.29.10.80, 7304.29.20.10,

7304.29.20.20, 7304.29.20.30,

7304.29.20.40, 7304.29.20.50,

7304.29.20.60, 7304.29.20.80,

7304.29.30.10, 7304.29.30.20,

7304.29.30.30, 7304.29.30.40,

7304.29.30.50, 7304.29.30.60,

7304.29.30.80, 7304.29.40.10,

7304.29.40.20, 7304.29.40.30,

7304.29.40.40, 7304.29.40.50,

7304.29.40.60, 7304.29.40.80,

7304.29.50.15, 7304.29.50.30,

7304.29.50.45, 7304.29.50.60,

7304.29.50.75, 7304.29.60.15,

7304.29.60.30, 7304.29.60.45,

7304.29.60.60, 7304.29.60.75,

7305.20.20.00, 7305.20.40.00,

7305.20.60.00, 7305.20.80.00,

7306.20.10.30, 7306.20.10.90,

7306.20.20.00, 7306.20.30.00,

7306.20.40.00, 7306.20.60.10,

7306.20.60.50, 7306.20.80.10, and

7306.20.80.50.

Although the HTSUS subheadings are

provided for convenience and customs

purposes, our written description of the

scope of this proceeding is dispositive.

The Department has determined that

couplings, and coupling stock, are not

within the scope of the antidumping

order on OCTG from Mexico. See Letter

to Interested Parties; Final Affirmative

Scope Decision, August 27, 1998.

Background

On August 31, 2000, petitioner on

behalf of U.S. Steel Group, a unit of

USX Corporation, requested an

administrative review of Tubos de

Acero de Mexico S.A. (TAMSA), a

Mexican producer and exporter of

OCTG, with respect to the antidumping

order published in the Federal Register

on August 11, 1995 (60 FR 41055).

Additionally, respondent Hylsa, S.A. de

C.V. (Hylsa) requested that the

Department conduct an administrative

review of Hylsa. We initiated the review

for both companies on October 2, 2000

(65 FR 58733). On October 19, 2000,

Hylsa withdrew its request and

requested that the Department terminate

the review with respect to Hylsa. On

October 26, 2000, we received

comments from TAMSA. On December

22, 2000, we received comments from

petitioners. These comments are

discussed below.

SUPPLEMENTARY INFORMATION: On

October 26, 2000 TAMSA claimed that

‘‘it did not export, directly or indirectly,

enter for consumption, or sell, export or

ship for entry for consumption in the

United States subject merchandise

during the period of review.’’ Petitioner

subsequently claimed on December 22,

2000, that publicly available import data

from the Department’s IM–145 database

showed that 2,914 metric tons of

seamless OCTG from Mexico entered

the United States during the period of

review. Petitioner asserted that TAMSA

was the only producer of seamless

OCTG in Mexico. In addition, petitioner

claimed that subject merchandise

produced by TAMSA was shipped from

a third country and entered into the

United States during the period of

review. Petitioner requested that the

Department investigate these

transactions to determine whether this

merchandise is subject to review.

In response to a telephone query on

March 6, 2001, TAMSA indicated that it

made no U.S. sales or consumption

entries during the POR. TAMSA

claimed all of its shipments to the

United States were TIB entries, and

were destined for re-export. TAMSA

also indicated that it had no knowledge

of its customers having entered covered

merchandise into the United States for

consumption. See Memorandum to File

dated March 17, 2001.

During March 2001, the U.S. Customs

Service (Customs) officially confirmed

that the entries shipped by TAMSA to

the United States were TIB entries.

Customs also confirmed that none of

these entries entered the customs

territory of the United States during the

POR for consumption. With respect to

the third country shipment referenced

by the petitioner, Customs officially

confirmed on April 5, 2001 that the

merchandise had been entered under

the proper country of export (the third

country) and that the merchandise was

declared as being of Mexican origin and

was entered subject to duty. Because

this merchandise was exported to the

United States by a party not affiliated

with TAMSA and not subject to this

review, and because there is no

evidence that TAMSA had knowledge of

the shipment or was involved with it in

any way, we have determined that there

are no shipments for purposes of this

review. On April 18, 2001, the

Department forwarded a no-shipment

inquiry to the Customs for circulation to

all Customs ports. Customs did not

indicate to the Department that there

was any record of consumption entries

during the POR of OCTG exported by

TAMSA.

Because there were no entries for

consumption during the POR for OCTG

for which TAMSA was the appropriate

respondent, and because Hylsa

withdrew its request for review, we are

rescinding this review in accordance

with the Department’s practice. The

cash deposit rate for these firms will

continue to be the rate established in the

most recently completed segment of this

proceeding.

This notice is issued and published in

accordance with section 777(i) of the

Act and 19 CFR 351.213(d)(4).

Dated: May 2, 2001.

Joseph A. Spetrini,

Deputy Assistant Secretary, AD/CVD

Enforcement Group III.

[FR Doc. 01–12213 Filed 5–14–01; 8:45 am]

BILLING CODE 3510–DS–P

DEPARTMENT OF COMMERCE

International Trade Administration

[A–337–805, A–201–829]

Initiation of Antidumping Duty

Investigations: Spring Table Grapes

From Chile and Mexico

AGENCY: Import Administration,

International Trade Administration,

Department of Commerce.

ACTION: Initiation of Antidumping Duty

Investigations.

EFFECTIVE DATE: May 15, 2001.

FOR FURTHER INFORMATION CONTACT:

Donna Kinsella (for Chile) or Irina Itkin

(for Mexico) at (202) 482–0194 and (202)

482–0656, respectively; Import

Administration, International Trade

Administration, U.S. Department of

Commerce, 14th Street and Constitution

Avenue, NW., Washington, DC 20230.

Initiation of Investigations

The Applicable Statute and Regulations

Unless otherwise indicated, all

citations to the statute are references to

the provisions effective January 1, 1995,

26832 Federal Register / Vol. 66, No. 94 / Tuesday, May 15, 2001 / Notices

the effective date of the amendments

made to the Tariff Act of 1930 (the Act)

by the Uruguay Round Agreements Act

(URAA). In addition, unless otherwise

indicated, all citations to the

Department of Commerce’s (the

Department’s) regulations are references

to the provisions codified at 19 CFR part

351 (April 2000).

The Petitions

On March 30, 2001, the Department

received petitions filed in proper form

by The Desert Grape Growers League of

California and its members (collectively

‘‘the League’’). The Department received

information supplementing the petitions

throughout the initiation period.

In accordance with section 732(b) of

the Act, the petitioners allege that

imports of spring table grapes from

Chile and Mexico are being, or are likely

to be, sold in the United States at less

than fair value within the meaning of

section 731 of the Act, and that such

imports are materially injuring an

industry in the United States.

On April 12 and 13, 2001, we

received submissions from the

Asociacion Agricola Local de

Productores de Uva de Mesa, A.C.

(AALPUM) and the Asociacion de

Exportadores de Chile (ASOEX),

associations of exporters of the subject

merchandise in Mexico and Chile,

respectively, which challenged the basis

for the petitioners’ claim of industry

support. On April 19, 2001, the

petitioners filed a response. On April

24, 2001, AALPUM and ASOEX

submitted additional comments on the

issue of industry support, and the

petitioners responded to these

comments on April 30, 2001. Moreover,

in April and May 2001, the Department

received a number of letters from

producers of table grapes in California

opposing the petitions. In addition, we

received several letters from California

table grape producers supporting the

petitions. The Department has taken

these submissions into consideration in

making the initiation determination.

Pursuant to section 732(c)(1)(B) the

Department extended the deadline for

initiation to no later than May 9, 2001.

The Department finds that the

petitioners filed these petitions on

behalf of the domestic industry because

they are interested parties as defined in

sections 771(9)(C) and (E) of the Act and

they have demonstrated sufficient

industry support with respect to each of

the antidumping investigations that they

are requesting the Department to initiate

(see the ‘‘Determination of Industry

Support for the Petitions’’ section,

below).

Scope of Investigations

The scope of these investigations

includes imports of any variety of vitis

vinifera species table grapes from Chile

or Mexico, entered during the period

April 1 through June 30, inclusive,

regardless of grade, size, maturity,

horticulture method (i.e., organic or not)

or the size of the container in which

packed. The scope specifically covers

all varieties of seedless or seeded grapes

including, but not limited to,

Thompson, Red Flame, Red Globe,

Perlettes, Superior seedless, Sugrone,

Ribier, Black seedless, Red seedless,

Blanca Italia, Moscatel Rosada, Crimson

seedless, Lavallee, Emperor, Queen

Rose, Calmeria, Christmas Rose, Down

seedless, Beauty seedless, Almeria,

Supreme seedless, Superior Seedless

M., Late Royal, Muscat seedless, Royal

seedless, Early Ribier, Cardinal,

Moscatel Dorada, Black Giant, Kaiji,

Lady Rose, Black Diamond, Piruviano,

Early Thompson, King Ruby seedless,

White seedless, Queen seedless,

Autumn seedless, Royal, Pink seedless,

Green Globe, Autumn Black, Black

Beauty, and Royal Giant. The scope

specifically covers all table grapes

entered within the April 1 through June

30 window of each year, whether or not

subject to the Federal Marketing Order

set forth in 7 CFR, part 925. For further

discussion, see the May 9, 2001,

memorandum from the case team to

Richard Moreland and Joseph Spetrini

entitled ‘‘Temporal Limitations on the

Class or Kind Described in the

Antidumping Duty Petitions on Spring

Table Grapes from Mexico and Chile.’’

The scope excludes by-product grapes

and other grapes for use as other than

table grapes, including those grapes

used for raisins, crushing, juice, wine,

canning, processed foods and other byproduct and not direct consumption

purposes.

The spring table grapes subject to

these investigations are classifiable

under subheading 0806.10.40 of the

Harmonized Tariff Schedule of the

United States (HTS). Although the HTS

subheading is provided for convenience

and customs purposes, the written

description of the merchandise under

investigation is dispositive.

During our review of the petitions, we

discussed the scope with the petitioners

to ensure that it accurately reflects the

product for which the domestic industry

is seeking relief. We note that the scope

in the petitions included all spring table

grapes harvested through June 30 of

each year. However, the U.S. Customs

Service has informed us that including

a harvesting limitation would lead to

problems in its administering these

cases. See the April 11, 2001,

memorandum from Chief, Special

Products Branch at the United States

Customs Service to David Goldberger

entitled ‘‘Proposed Scope Language,

Spring Table Grapes from Chile and

Mexico.’’ We agree that including grapes

harvested through June 30 will raise

major questions for imports after June

30. As a consequence, we have not

included spring table grapes harvested

during the period April 1 though June

30 but entered after that period in the

scope of the merchandise under

investigation. We have discussed this

scope modification with the petitioners.

As discussed in the preamble to the

Department’s regulations (see

Antidumping Duties; Countervailing

Duties; Final Rule, 62 FR 27295, 27323

(May 19, 1997)), we are setting aside a

period for parties to raise issues

regarding product coverage. The

Department encourages all parties to

submit such comments within 20

calendar days of publication of this

notice. Comments should be addressed

to Import Administration’s Central

Records Unit at Room 1870, U.S.

Department of Commerce, 14th Street

and Constitution Avenue, NW.,

Washington, DC 20230. The period of

scope consultations is intended to

provide the Department with ample

opportunity to consider all comments

and consult with parties prior to the

issuance of the preliminary

determinations.

Class or Kind

In addition to describing the physical

product at issue, the antidumping duty

petitions on spring table grapes from

Mexico and Chile limit the class or kind

to table grapes entered in the spring.

Parties have argued that the Department

does not have the authority to accept a

class or kind limited to imports during

certain periods, or, in the alternative,

that the temporal limitations in this case

are not appropriate. However, in the

view of the Department the statute does

not preclude a limitation on subject

merchandise according to the time of

year during which that merchandise

was produced or entered. Section

771(25) of the Act only defines the term

subject merchandise in pertinent part as

the ‘‘class or kind of merchandise that

is within the scope of an investigation.

***’’ However, neither the term

‘‘class or kind’’ nor the term ‘‘scope’’ is

defined in the statute.

It is well established that the

Department has the ultimate authority

under the statute to define the class or

kind of merchandise subject to its

Federal Register / Vol. 66, No. 94 / Tuesday, May 15, 2001 / Notices 26833

1See Mitsubishi Elec. Corp. v. United States, 898

F.2d 1577, 1582 (Fed. Cir. 1990); and Diversified

Products Corp. v. United States, 572 F.Supp. 883,

887 (1983). See also Smith-Corona Group v. United

States, 713 F.2d 1568, 1582 (Fed. Cir. 1983), cert.

denied, 465 U.S. 1022 (1984).

2See Mitsubishi Elec. Corp. v. United States, 700

F.Supp. 538, 555 (1988), aff’d, 898 F.2d 1577 (Fed.

Cir. 1990); and Torrington Co. v. United States, 745

F.Supp. 718, 721 n4 (CIT 1990).

3 In many cases the Department has used the socalled ‘‘Diversified Products’’ criteria in analyzing

class or kind issues. See 19 CFR § 351.225(k)(2).

However, these criteria are not used to expand the

class or kind defined in the petition, but rather to

determine whether a particular product is within

the class or kind as defined or, more rarely, to

determine whether the scope as alleged actually

covers several classes or kinds. See, e.g. Partial

Recission of Initiation of Antidumping

Investigations and Dismissal of Petitions;

Antifriction Bearings (Other Than Tapered Roller

Bearings) and Parts Thereof From Romania,

Singapore, and Thailand, 53 FR 39327 (October 6,

1988) (Department split one class or kind in to five

classes or kinds); and Cyanuric Acid and Its

Chlorinated Derivatives from Japan Used in the

Swimming Pool Trade; Final Determination of Sales

at Less Than Fair Value, 49 FR 7424 (1984)

(Department split one class or kind into three

classes or kinds). In other words, absent some

overarching reason to the contrary, the fact that

application of the ‘‘Diversified Products’’ criteria

reveals that a particular product which is excluded

from the scope could be considered within the same

class or kind will not normally result in including

that product in the coverage of the investigation for

reasons discussed above: to the extent the

petitioners are not interested in seeking trade relief

against a particular product, the Department should

not require them to do so. There does not appear

to be any such reason to depart from this approach

in this case.

4See Torrington, 745 F.Supp. at 721. (‘‘The

petitioner’s description of class or kind is awarded

some deference inasmuch as the petitioner often

will call Commerce’s attention to an otherwise

overlooked potential dumping problem.’’).

5See Algoma Steel Corp. Ltd., v. United States,

688 F. Supp. 639, 642–44 (CIT 1988); High

Information Content Flat Panel Displays and

Display Glass from Japan: Final Determination;

Rescission of Investigation and Partial Dismissal of

Petition, 56 FR 32376, 32380–81 (July 16, 1991).

proceedings.1 Thus, the Department has

the authority both to limit and to

expand the class or kind alleged in the

petition.2 This authority

notwithstanding, it has generally been

the policy of the Department to accept

the class or kind of merchandise alleged

in the petition absent some overarching

reason to modify that class or kind.3

This policy stems from the fact that the

domestic industry is in the best position

to identify the imports that they

compete against and believe to be

unfairly traded.4

Moreover, a petitioning industry often

must draw a bright line between the

imports it wants covered and those it

does not. To the extent it can establish

that the covered imports are dumped

and the cause of material injury, it is

entitled to relief under the statute,

notwithstanding the fact that it may

have excluded from the scope other

products which may or may not also be

the subject of injurious dumping. It is

appropriate not to make imports the

subject of unnecessary antidumping

proceedings. It is also appropriate that

the Department not force the petitioner

to seek duties on products against its

will.

In the present case, the petitioners

have drawn a legitimate line between

those products they believe to be

appropriately covered, and those they

do not. First, the existence of a separate

HTS number for the April 1–June 30

period (i.e. HTS 0806.10.40) supports a

finding that such a period appropriately

can form a class or kind of merchandise.

The Department has often stated that its

determination as to the appropriate

coverage of an investigation is not

determined by HTS categories.

However, the fact that the period of

April through June falls under a

separate HTS category reflects the fact

that imports during this season are

recognized by industry and other U.S.

government agencies as distinct from

other imports. In both cases the

petitioners have rationally identified

those imports which directly compete

with their product, and excluded from

the investigation those imports which

they are not concerned about. Imports

from Chile and Mexico during the April

1 through July 30 period compete with

spring grape production in the United

States, which begins in May and

continues through July.

For all of these reasons we have

determined that these cases can proceed

on the basis of a class or kind defined

in part by the April 1 through June 30

period.

Determination of Industry Support for

the Petitions

Section 732(b)(1) of the Act requires

that a petition be filed on behalf of the

domestic industry. Section 732(c)(4)(A)

of the Act provides that the

Department’s industry support

determination, which is to be made

before the initiation of the investigation,

be based on whether a minimum

percentage of the relevant industry

supports the petition. A petition meets

this requirement if the domestic

producers or workers who support the

petition account for: (1) At least 25

percent of the total production of the

domestic like product; and (2) more

than 50 percent of the production of the

domestic like product produced by that

portion of the industry expressing

support for, or opposition to, the

petition. Moreover, section 732(c)(4)(D)

of the Act provides that, if the petition

does not establish support of domestic

producers or workers accounting for

more than 50 percent of the total

production of the domestic like product,

the Department shall either poll the

industry or rely on other information in

order to determine if there is support for

the petition.

Section 771(4)(A) of the Act defines

the ‘‘industry’’ as the producers of a

domestic like product. Thus, to

determine whether the petition has the

requisite industry support, the statute

directs the Department to look to

producers and workers who produce the

domestic like product. The International

Trade Commission (ITC), which is

responsible for determining whether

‘‘the domestic industry’’ has been

injured, must also determine what

constitutes a domestic like product in

order to define the industry. While both

the Department and the ITC must apply

the same statutory definition regarding

the domestic like product (section

771(10) of the Act), they do so for

different purposes and pursuant to

separate and distinct authority. In

addition, the Department’s

determination is subject to limitations of

time and information. Although this

may result in different definitions of the

like product, such differences do not

render the decision of either agency

contrary to the law.5

Section 771(10) of the Act defines the

domestic like product as ‘‘a product

which is like, or in the absence of like,

most similar in characteristics and uses

with, the article subject to an

investigation under this subtitle.’’ Thus,

the reference point from which the

domestic like product analysis begins is

‘‘the article subject to an investigation,’’

i.e., the class or kind of merchandise to

be investigated, which normally will be

the scope as defined in the petition.

The domestic like product described

in the petitions is spring table grapes

sold for fresh use, regardless of variety.

Based upon our review of the

petitioners’ claims, we concur that there

is a single domestic like product: spring

table grapes sold for fresh consumption.

For further discussion, see the May 9,

2001, from the case team to Richard

Moreland and Joseph Spetrini

memorandum entitled ‘‘Domestic Like

Product and Industry Support.’’

Concerning industry support, for both

countries covered by the petitions, the

petitioners claimed that they represent

the majority of the spring table grapes

industry, defined as growers of U.S.

table grapes in the period April through

June. We find that the spring table

grapes industry consists of those

producers who harvest grapes

predominantly during this period (i.e.,

those producers in the Coachella Valley

of California and western Arizona).

26834 Federal Register / Vol. 66, No. 94 / Tuesday, May 15, 2001 / Notices

Consequently, we find that the

petitioners established industry support

by demonstrating that they account for

over 25 percent of total production of

the domestic like product (see

Antidumping Investigations Initiation

Checklist, dated May 9, 2001 (Initiation

Checklist), thereby meeting the first

requirement under section 732(c)(4)(A)

of the Act.

We note that in 2000 a small amount

of production by the Coachella Valley

and western Arizona producers actually

occurred in July. However, even if we

include all U.S. production data for July

in our determination of industry

support, we would find that the

petitioners established industry support

by demonstrating that they account for

over 25 percent of total production of

the domestic like product (see the May

9, 2001, memorandum from the team to

Richard W. Moreland and Joseph

Spetrini entitled ‘‘Industry Support

Calculations in the Antidumping Duty

Petitions on Spring Table Grapes from

Chile and Mexico’’ (the Industry

Support Memo). In making this

determination, we observe that by

including July the petitioners would

represent less than 50 percent of the

domestic production of the like product

in the April through July period. For

this reason, we have additionally

examined industry support as required

by section 732(c)(4)(D) of the Act

considering the positions of each

company with production in the April

through July period which expressed an

opinion on the petitions. We find that,

based on this additional information,

there is still sufficient support for the

petition. Specifically, we find that the

companies supporting the petitions

represent over 50 percent of the

production of companies that have

expressed support or opposition to the

petitions. Furthermore, because we have

determined that several additional

companies have taken neutral positions

with respect to the petitions, we find

that any additional potential opposition

could not possibly represent over 50

percent of the industry. See the Industry

Support Memo. Accordingly, we

determine that these petitions are filed

on behalf of the domestic industry

within the meaning of section

732(c)(4)(A) of the Act.

Constructed Export Price and Normal

Value

The following are descriptions of the

allegations of sales at less than fair value

upon which the Department based its

decision to initiate these investigations.

The sources of data for the deductions

and adjustments relating to U.S. price,

home market price, third country price,

and constructed value (CV) are also

discussed in the Initiation Checklist.

Should the need arise to use any of this

information as facts available under

section 776 of the Act in our

preliminary or final determinations, we

may re-examine the information and

revise the margin calculations, if

appropriate.

Chile

Constructed Export Price

The petitioners identified ten of the

largest export trading companies which

account for sixty percent by volume of

spring table grape exports to the United

States during the year 2000. The ten

exporters are: David del Curto S.A., Dole

Chile S.A., Exportadora Rio Blanco

Ltda., Exportadora Agua Santa S.A.,

Exportadora Chiquita-Enza Chile Ltda.,

Del Monte Fresh Produce S.A.,

(formerly United Trading Company),

Servicios de Exportaciones Fruiticolas

Ltda., Sociedad Agro Comercial Verfrut

Ltda., Exportadora Aconcagua Ltda.,

Exportadora Unifruitti Traders Ltda.

The petitioners used information

obtained through foreign market

research to demonstrate that the prices

negotiated by the U.S. importers/

distributors of spring table grapes to

their customers in the U.S. market on

behalf of Chilean exporters are the

prices that should be used to determine

dumping margins for grapes exported

from Chile. To the best of the

petitioners’ knowledge, the exporter is

the first party in the chain of

distribution that has knowledge of the

ultimate destination of the merchandise.

In this case, the exporters sell the grapes

in the United States through affiliated or

unaffiliated importers/distributors.

Accordingly, it is appropriate to use

constructed export price (CEP) based on

the prices of the sales by the U.S.

importers/distributors in the United

States. However, the petitioners were

unable to obtain these prices. For

purposes of the petition, petitioners

obtained through foreign market

research the corresponding FOB Chile

prices (i.e., the resulting price after the

deduction of all relevant expenses from

the prices of sales in the United States).

These prices are based on data compiled

by ODEPA, an official government

agency of Chile. The average FOB Chile

prices obtained through foreign market

research are consistent with the average

FOB values in the official U.S. import

statistics. (See Exhibit B–13 of the

petition.)

Normal Value

With respect to normal value (NV),

information reasonably available to the

petitioners indicates the existence of a

particular market situation which

renders price comparisons between

home market and U.S. prices

inappropriate. The factors cited by the

petitioners as evidence of a particular

market situation in Chile with respect to

spring table grapes are the same factors

present in Notice of Final Determination

of Sales at Less Than Fair Value: Fresh

Atlantic Salmon From Chile, 63 FR

31411 (June 9, 1998): (1) The Chilean

table grape industry is export-oriented;

(2) the home market is incidental to the

Chilean industry; (3) the home market is

comprised almost exclusively of grapes

graded as other than export quality; (4)

the home market sales are made at

drastically reduced prices compared to

the export quality merchandise; and (5)

domestically-sold spring table grapes

had perfunctory marketing and

distribution. As a result, the petitioners

obtained information through foreign

market research for nine Chilean

exporters with respect to sales to third

country markets. The petitioners

obtained information demonstrating that

the Netherlands, Hong Kong/People’s

Republic of China, and Mexico are by

far the principal third country export

markets for Chilean spring table grapes.

The petitioners relied on exporterspecific data to determine the largest

third country market by exporter and

then based NV for that exporter on its

sales to that market.

In the course of this investigation, the

Department will examine further the

issue of particular market situation and

the proper comparison market to be

examined in this investigation.

Based upon the comparison of CEP to

NV, the estimated dumping margins

range from 23.00 to 99.39 percent.

Mexico

Constructed Export Price

According to the petitioners, U.S.

sales of the subject merchandise should

be considered CEP sales, as the first

sales to unaffiliated customers in the

United States are made by brokers/

commissionaires in the United States on

behalf of the Mexican producers.

The petitioners based CEP on U.S.

export price data from two Mexican

growers’ associations. According to the

petitioners, these prices are packed,

FOB shipping prices in Nogales,

Arizona. To calculate CEP, the

petitioners deducted a distributor’s

commission (i.e., distributor mark-up),

cold storage and palletization costs, and

movement expenses (i.e., foreign inland

freight, U.S. border crossing fees, USDA

inspection fees, and U.S. inland freight)

from the price quotes. The information

Federal Register / Vol. 66, No. 94 / Tuesday, May 15, 2001 / Notices 26835

for all of these adjustments except

foreign inland freight, palletization and

cold storage expenses were based on the

actual documentation of U.S. sales

transactions. The other information was

obtained from the petitioners’ foreign

market research. The petitioners also

made an adjustment for credit expenses

based on the payment terms claimed to

be typical for the industry and the

average lending rate in the United States

during the second quarter of 2000, as

published in International Financial

Statistics.

Normal Value

The petitioners based NV on CV

because they claimed that all of the

prices that they obtained in the home

market were made below the fully

absorbed cost of production (COP),

within the meaning of section 773(b) of

the Act. As a consequence, they alleged

that there are reasonable grounds to

believe or suspect that sales of the

subject merchandise in the home market

were made at below-cost prices and they

requested that the Department conduct

a country-wide sales-below-cost

investigation.

Pursuant to section 773(b)(3) of the

Act, COP consists of cost of manufacture

(COM), selling, general, and

administrative (SG&A) expenses, and

packing expenses. The petitioners

calculated COM, SG&A expenses, and

packing expenses for three varieties of

grapes based on costs contained in

foreign market research studies for

grapes produced in Mexico. We

adjusted the petitioners’ calculations of

the COPs by excluding the amounts for

selling expenses, because these

expenses were deducted, in part, from

the home market sales prices.

With respect to home market price,

the petitioners obtained Mexican home

market daily wholesale prices through

the Mexican National Market

Information System. The petitioners

made a deduction from home market

price for foreign inland freight obtained

from foreign market research.

Additionally, the petitioners deducted

distributor markups using the

percentage applied to CEP sales as they

were unable to obtain comparable

Mexican price information.

The petitioners claimed that their

foreign market research showed that

there are no other fees, such as

inspection or cold storage expenses,

incurred on home market sales.

However, based on the description of

the harvesting and distribution system,

we find it unlikely that grapes in the

home market underwent no cold storage

at all. For purposes of the initiation, we

included an adjustment for cold storage

expenses to the net home market price

based on the same information applied

to CEP.

Based upon a comparison of the

prices of the foreign like products in the

home market to the calculated COPs of

those products, we find reasonable

grounds to believe or suspect that sales

of the foreign like product were made

below the COP, within the meaning of

section 773(b)(2)(A)(i) of the Act.

Accordingly, the Department is

initiating a country-wide cost

investigation.

Pursuant to sections 773(a)(4), 773(b)

and 773(e) of the Act, the petitioners

based NV on CV. The petitioners

calculated CVs for three varieties of

grapes using the same COM, SG&A and

packing expense figures used to

compute the home market costs. The

petitioners, using a conservative

approach, did not include an amount for

profit in their calculation of CV as

provided by section 773(e)(2) of the Act.

We adjusted the petitioners’

calculations of CV by excluding the

amounts of selling expenses the

petitioners included in SG&A expenses.

The petitioners claimed that their

foreign market research showed that

there are generally no credit expenses

incurred on home market sales.

However, our review of the petition

documentation indicates that home

market credit expense may be incurred

on some sales. Therefore, for purposes

of the initiation, we included an

adjustment to CV for Mexican credit

expenses using the payment terms data

applied to the CEP sales and the

Mexican interest rate published in

International Financial Statistics.

Based upon the comparison of CEP to

CV, the revised calculated estimated

dumping margins range from 0 to114.77

percent.

Fair Value Comparisons

Based on the data provided by the

petitioners, there is reason to believe

that imports of spring table grapes from

Chile and Mexico are being, or are likely

to be, sold at less than fair value.

Allegations and Evidence of Material

Injury and Causation

The petitions allege that the U.S.

industry producing the domestic like

product is being materially injured, or is

threatened with material injury, by

reason of the individual and cumulated

imports of the subject merchandise. The

petitioners contend that the industry’s

injured condition is evident in the

declining trends in net operating

income, net sales volume and value,

profit to sales ratios, and capacity

utilization. The allegations of injury and

causation are supported by relevant

evidence including U.S. Customs import

data, lost sales, and pricing information.

We have assessed the allegations and

supporting evidence regarding material

injury and causation, and have

determined that these allegations are

properly supported by accurate and

adequate evidence, and meet the

statutory requirements for initiation (see

Initiation Checklist).

Initiation of Antidumping

Investigations

Based upon our examination of the

petitions on spring table grapes, we

have found that they meet the

requirements of section 732 of the Act.

Therefore, we are initiating

antidumping duty investigations to

determine whether imports of spring

table grapes from Chile and Mexico are

being, or are likely to be, sold in the

United States at less than fair value.

Unless this deadline is extended, we

will make our preliminary

determinations no later than 140 days

after the date of this initiation.

Distribution of Copies of the Petitions

In accordance with section

732(b)(3)(A) of the Act, a copy of the

public version of each petition has been

provided to the representatives of the

governments of Chile and Mexico. We

will attempt to provide a copy of the

public version of each petition to each

exporter named in the petition, as

appropriate.

International Trade Commission

Notification

We have notified the ITC of our

initiations, as required by section 732(d)

of the Act.

Preliminary Determinations by the ITC

The ITC will determine, no later than

June 4, 2001, whether there is a

reasonable indication that imports of

spring table grapes from Chile and

Mexico are causing material injury, or

threatening to cause material injury, to

a U.S. industry. A negative ITC

determination for any country will

result in the investigations being

terminated with respect to that country;

otherwise, these investigations will

proceed according to statutory and

regulatory time limits.

This notice is issued and published

pursuant to section 777(i) of the Act.

Dated: May 9, 2001.

Faryar Shirzad,

Assistant Secretary for Import

Administration.

[FR Doc. 01–12212 Filed 5–14–01; 8:45 am]

BILLING CODE 3510–DS–P