45708 Federal Register / Vol. 73, No. 152 / Wednesday, August 6, 2008 / Notices 

1Petitioners are Allegheny Ludlum Corporation, 

AK Steel Corporation, North American Stainless, 

United Auto Workers Local 3303, Zanesville Armco 

Independent Organization, Inc. and the United 

Steelworkers of America. 

Antidumping Duties, 68 FR 23954 (May 

6, 2003). 

Cash Deposit Requirements 

The following cash–deposit rates will 

be effective upon publication of the 

final results of this review for all 

shipments of CMC from Sweden 

entered, or withdrawn from warehouse, 

for consumption on or after publication 

date, as provided for by section 

751(a)(2)(C) of the Act: (1) for subject 

merchandise produced by CP Kelco, the 

cash–deposit rate will be the rate 

established in the final results of this 

review, except if the rate is less than 

0.50 percent and, therefore, de minimis 

within the meaning of 19 CFR 

351.106(c)(1), in which case the cash 

deposit rate will be zero; 2) if the 

exporter is not a firm covered in this 

review or the less–than-fair–value 

(LTFV) investigation, but the 

manufacturer is, the cash deposit rate 

will be the rate established for the most 

recent period for the manufacturer of 

the merchandise; and 3) if neither the 

exporter nor the manufacturer is a firm 

covered in this or any previous review 

conducted by the Department, the cash 

deposit rate will be the all–others rate 

of 25.29 percent from the LTFV 

investigation. See Order, 70 FR at 

39735. 

These deposit requirements, when 

imposed, shall remain in effect until 

further notice. 

Public Comment 

Pursuant to section 351.224(b) of the 

Department’s regulations, the 

Department will disclose to parties to 

the proceeding any calculations 

performed in connection with these 

preliminary results within five days 

after the date of publication of this 

notice. Pursuant to section 351.309 of 

the Department’s regulations, interested 

parties may submit written comments in 

response to these preliminary results. 

Unless extended by the Department, 

case briefs are to be submitted within 30 

days after the date of publication of this 

notice, and rebuttal briefs, limited to 

arguments raised in case briefs, are to be 

submitted no later than five days after 

the time limit for filing case briefs. See 

19 CFR 351.309(c)(1)(ii) and (d)(1). 

Parties who submit arguments in this 

proceeding are requested to submit with 

the argument: (1) a statement of the 

issues; and (2) a brief summary of the 

argument. See 19 CFR 351.309. Case and 

rebuttal briefs must be served on 

interested parties in accordance with 

section 351.303(f) of the Department’s 

regulations. Further, we request that 

parties submitting briefs and rebuttal 

briefs provide the Department with a 

copy of the public version of such briefs 

on diskette. 

Also, pursuant to section 351.310(c) 

of the Department’s regulations, within 

30 days of the date of publication of this 

notice, interested parties may request a 

public hearing on arguments raised in 

the case and rebuttal briefs. Unless the 

Secretary specifies otherwise, the 

hearing, if requested, will be held two 

days after the date for submission of 

rebuttal briefs. See 19 CFR 

351.310(d)(1). Parties will be notified of 

the time and location. 

The Department will publish the final 

results of the administrative review, 

including the results of its analysis of 

issues raised in any case or rebuttal 

brief, no later than 120 days after 

publication of the preliminary results, 

unless extended. See section 

751(a)(3)(A) of the Act; 19 CFR 

351.213(h). 

Notification to Importers 

This notice serves as a preliminary 

reminder to importers of their 

responsibility under section 351.402(f) 

of the Department’s regulations to file a 

certificate regarding the reimbursement 

of antidumping duties prior to 

liquidation of the relevant entries 

during this review period. Failure to 

comply with this requirement could 

result in the Secretary’s presumption 

that reimbursement of antidumping 

duties occurred and the subsequent 

assessment of double antidumping 

duties. 

This administrative review and notice 

are issued and published in accordance 

with sections 751(a)(1) and 777(i)(1) of 

the Act. 

Dated: July 30, 2008. 

David M. Spooner, 

Assistant Secretary for Import 

Administration. 

[FR Doc. E8–18029 Filed 8–5–08; 8:45 am] 

BILLING CODE 3510–DS–S 

DEPARTMENT OF COMMERCE 

International Trade Administration 

[A–201–822] 

Stainless Steel Sheet and Strip in Coils 

From Mexico; Preliminary Results of 

Antidumping Duty Administrative 

Review 

AGENCY: Import Administration, 

International Trade Administration, 

Department of Commerce. 

ACTION: Notice of Preliminary Results of 

Antidumping Duty Administrative 

Review. 

SUMMARY: In response to requests from 

respondent ThyssenKrupp Mexinox 

S.A. de C.V. (Mexinox S.A.) and 

Mexinox USA, Inc. (Mexinox USA) 

(collectively, Mexinox) and petitioners,1

the Department of Commerce (the 

Department) is conducting an 

administrative review of the 

antidumping duty order on stainless 

steel sheet and strip in coils (S4 in coils) 

from Mexico. This administrative 

review covers imports of subject 

merchandise from Mexinox S.A. during 

the period July 1, 2006, to June 30, 2007. 

We preliminarily determine that sales 

of S4 in coils from Mexico have been 

made below normal value (NV). If these 

preliminary results are adopted in our 

final results of administrative review, 

we will instruct United States Customs 

and Border Protection (CBP) to assess 

antidumping duties based on the 

difference between the constructed 

export price (CEP) and NV. Interested 

parties are invited to comment on these 

preliminary results. Parties who submit 

argument in these proceedings are 

requested to submit with the argument: 

(1) A statement of the issues, (2) a brief 

summary of the argument, and (3) a 

table of authorities. 

EFFECTIVE DATE: August 6, 2008. 

FOR FURTHER INFORMATION CONTACT: 

Maryanne Burke or Robert James, 

AD/CVD Operations, Office 7, Import 

Administration, International Trade 

Administration, U.S. Department of 

Commerce, 14th Street and Constitution 

Avenue, NW., Washington, DC 20230; 

telephone: (202) 482–5604 or (202) 482–

0649, respectively. 

SUPPLEMENTARY INFORMATION: 

Background 

On July 27, 1999, the Department 

published in the Federal Register the 

Notice of Amended Final Determination 

of Sales at Less Than Fair Value and 

Antidumping Duty Order; Stainless 

Steel Sheet and Strip in Coils from 

Mexico, 64 FR 40560 (July 27, 1999). On 

July 3, 2007, the Department published 

a notice entitled Antidumping or 

Countervailing Duty Order, Finding, or 

Suspended Investigation; Opportunity 

To Request Administrative Review, 72 

FR 36420 (July 3, 2007), covering, inter 

alia, S4 in coils from Mexico for the 

period July 1, 2006 through June 30, 

2007. 

In accordance with 19 CFR 

351.213(b)(1), Mexinox and petitioners 

requested that the Department conduct 

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Federal Register / Vol. 73, No. 152 / Wednesday, August 6, 2008 / Notices 45709 

an administrative review. On August 24, 

2007, we published in the Federal 

Register a notice of initiation of this 

antidumping duty administrative review 

covering the period July 1, 2006 through 

June 30, 2007. See Initiation of 

Antidumping and Countervailing Duty 

Administrative Reviews and Requests 

for Revocation in Part, 72 FR 48613 

(August 24, 2007). 

On September 11, 2007, the 

Department issued an antidumping duty 

questionnaire to Mexinox. Mexinox 

submitted its response to section A of 

the questionnaire on October 3, 2007, 

and its response to sections B through 

E of the questionnaire on October 29, 

2007. On January 9, 2008, the 

Department issued its supplemental 

questionnaire for section A. Mexinox 

responded to this supplemental 

questionnaire on February 1, 2008. On 

March 5, 2008, the Department issued 

another supplemental questionnaire 

which covered sections A through C. 

Mexinox filed its response to this 

questionnaire on April 7, 2008. The 

Department also issued a supplemental 

questionnaire for section D on April 11, 

2008, to which Mexinox responded on 

May 19, 2008. On May 2, 2008, the 

Department issued another 

supplemental questionnaire for sections 

A through C, as well as for section E, the 

latter of which pertains to an affiliated 

U.S. reseller, Ken-Mac Metals (KenMac). Mexinox filed its response to this 

supplemental questionnaire also on May 

19, 2008. Finally, the Department issued 

separate supplemental questionnaires 

covering section D and sections A 

through C on May 19, 2008 and May 30, 

2008, respectively. Mexinox submitted 

its responses to both of these 

supplemental questionnaires on June 

11, 2008. 

Because it was not practicable to 

complete this review within the normal 

time frame, on February 22, 2008, we 

published in the Federal Register our 

notice of the extension of time limits for 

this review. See Stainless Steel Sheet 

and Strip in Coils from Mexico; 

Extension of Time Limit for Preliminary 

Results of Antidumping Duty 

Administrative Review, 73 FR 9772 

(February 22, 2008). This extension 

established the deadline for these 

preliminary results as July 30, 2008. 

Cost Reporting Period 

On December 19, 2007, Mexinox 

submitted information regarding its 

material input costs for the period of 

review (POR) and claimed the use of a 

single weighted-average cost for 

austenitic products for the entire POR 

would distort the dumping margin 

calculation due to sharply rising nickel 

costs throughout the period. Rather than 

using a single POR-average cost for 

purposes of the sales-below-cost test, 

Mexinox urged the Department to 

consider employing monthly or 

quarterly costs for austenitic products 

(i.e. those products that contain nickel) 

in this segment of the proceeding. On 

June 27, 2008, petitioners submitted 

comments claiming the Department’s 

standard practice of using POR-average 

costs is appropriate in the instant case. 

In rebuttal comments submitted July 2, 

2008, Mexinox maintains record 

evidence shows a direct link between 

cost increases for austenitic hot-rolled 

stainless steel band (hot band), the 

principle material input for S4 in coils, 

and price increases for finished S4 in 

coils during the POR through alloy 

surcharges which Mexinox claims act as 

a pass-through pricing mechanism. In 

addition, on July 10, 2008, the 

Department met with representatives for 

Mexinox on this issue. See Ex Parte 

Memorandum to the File, from 

Maryanne Burke dated July 14, 2008, on 

file in CRU in room 1117 of the main 

Commerce building. 

The Department has considered the 

sales and cost information reported by 

Mexinox, in addition to the comments 

submitted by petitioners and Mexinox. 

Based on our analysis, we preliminarily 

find it appropriate to use Mexinox’s 

reported quarterly costs of austenitic 

products for this review. With the 

exception of cases where high inflation 

exists in which the Department restates 

an annual weighted-average cost to an 

equivalent basis, the Department’s 

normal practice is to calculate a 

weighted-average cost for the entire POR 

unless this methodology results in 

inappropriate comparisons or skewed 

data. See, e.g., Certain Pasta from Italy; 

Final Results of Antidumping Duty 

Administrative Review, 65 FR 77852 

(December 13, 2000) and accompanying 

Issues and Decision Memorandum at 

comment 18; see also Final Results of 

Antidumping Duty Administrative 

Review and Determination not to 

Revoke the Antidumping Order: Brass 

Sheet and Strip from the Netherlands, 

65 FR 742, 746 (January 5, 2000). In 

determining whether distortions result 

from significant cost fluctuations in the 

context of our antidumping duty 

calculations, the Department has 

historically evaluated the case specific 

record evidence using two primary 

factors: (1) Whether the cost changes 

throughout the POI/POR were 

significant; and (2) whether sales during 

the shorter averaging periods could be 

accurately linked with the COP/CV 

during the same shorter averaging 

periods. See Certain Steel Concrete 

Reinforcing Bars From Turkey; Final 

Results, Rescission of Antidumping 

Duty Administrative Review in Part, and 

Determination To Revoke in Part (Rebar 

from Turkey), 70 FR 67665 (November 

8, 2005) and accompanying Issues and 

Decision Memorandum at Comment 1. 

See also Habas Sinai ve Tibbi Gazlar 

Istihsal Endustrisi A.S., Plantiff, v. 

United States, Court No. 05–00613, Slip 

Op. 07–167 (CIT November 15, 2007). 

With regard to the first factor, record 

evidence provided by Mexinox 

demonstrates significant changes in the 

total cost of manufacture (COM) 

throughout the POR for austenitic 

stainless steel sheet and strip products 

produced during the POR. Based upon 

the record of this review, the significant 

change throughout the POR in the total 

COM is due to the price volatility of 

nickel which is used in the production 

of the austenitic hot band purchased by 

Mexinox. Austenitic hot band is 

Mexinox’s raw material input for certain 

merchandise under consideration. Thus, 

unlike Rebar from Turkey, we 

preliminary conclude that the 

differences in COM are significant 

enough to warrant a departure from our 

standard annual costing approach based 

upon record evidence indicating our 

annual cost approach would lead to 

distortions in our sales-below-cost test 

and inconsistencies in our overall 

margin calculation. 

To address the second factor, 

Mexinox demonstrated that, through its 

alloy surcharge levied on all sales 

during the POR, there is a linkage 

between the increasing direct material 

costs and final sale prices. Specifically, 

Mexinox illustrated that nickel 

acquisition and consumption costs are 

related to the market prices promulgated 

by the London Metal Exchange. We note 

the alloy surcharge regime is a common 

business practice in the stainless steel 

industry, whereby the changes in 

material costs realized by producers 

during the months preceding the date of 

sale are measured and ultimately 

transferred to its final customers. While 

we acknowledge that the alloy surcharge 

figure does not directly correspond to 

changes in the price of the applicable 

raw material used in the production to 

which the surcharge applies, as found in 

Brass from the Netherlands, the 

surcharge amount is, by design, a passthrough mechanism developed to 

account for raw material price changes. 

The objective of this pass-through 

mechanism satisfies the basic theory 

behind our second criterion—it 

demonstrates a direct link between 

production costs and sales prices. We 

have examined the data submitted by 

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45710 Federal Register / Vol. 73, No. 152 / Wednesday, August 6, 2008 / Notices 

Mexinox and have concluded that a 

quarterly costing approach would lead 

to more appropriate comparisons in our 

antidumping duty calculations for 

austenitic products. For those products 

reported that do not contain nickel, we 

have continued to use a single 

weighted-average cost for the POR. 

Additionally, we note the Department 

solicited comments from outside parties 

on shorter cost averaging periods in a 

Federal Register notice. See 

Antidumping Methodologies for 

Proceedings that Involve Significant 

Cost Changes Throughout the Period of 

Investigation (POI)/Period of Review 

(POR) that May Require Using Shorter 

Cost Averaging Periods; Request for 

Comment, 73 FR 26364 (May 9, 2008) 

(Antidumping Methodologies; Request 

for Comment ). On June 9, 2008, the 

Department extended the time limit for 

parties to submit written comments 

concerning this issue to June 23, 2008. 

See Antidumping Methodologies for 

Proceedings that Involve Significant 

Cost Changes Throughout the Period of 

Investigation (POI)/Period of Review 

(POR) that May Require Using Shorter 

Cost Averaging Periods; Request for 

Comment and Proposed Methodology 

for Identifying and Analyzing Targeted 

Dumping in Antidumping 

Investigations; Request for Comment, 73 

FR 32557 (June 9, 2008). We are 

currently analyzing the comments 

received which could lead the 

Department to formulate a different 

methodological framework on this 

matter. Thus, we will further examine 

the facts of this case for the final results 

of this review in light of both the 

comments received from the interested 

parties in this administrative review and 

the general comments received with 

respect to Antidumping Methodologies; 

Request for Comment. 

Period of Review 

The POR is July 1, 2006 through June 

30, 2007. 

Scope of the Order 

For purposes of this order, the 

products covered are certain stainless 

steel sheet and strip in coils. Stainless 

steel is an alloy steel containing, by 

weight, 1.2 percent or less of carbon and 

10.5 percent or more of chromium, with 

or without other elements. The subject 

sheet and strip is a flat-rolled product in 

coils that is greater than 9.5 mm in 

width and less than 4.75 mm in 

thickness, and that is annealed or 

otherwise heat treated and pickled or 

otherwise descaled. The subject sheet 

and strip may also be further processed 

(e.g., cold-rolled, polished, aluminized, 

coated, etc.) provided that it maintains 

the specific dimensions of sheet and 

strip following such processing. 

The merchandise subject to this order 

is currently classifiable in the 

Harmonized Tariff Schedule of the 

United States (HTSUS) at subheadings: 

7219.13.00.31, 7219.13.00.51, 

7219.13.00.71, 7219.13.00.81, 

7219.14.00.30, 7219.14.00.65, 

7219.14.00.90, 7219.32.00.05, 

7219.32.00.20, 7219.32.00.25, 

7219.32.00.35, 7219.32.00.36, 

7219.32.00.38, 7219.32.00.42, 

7219.32.00.44, 7219.33.00.05, 

7219.33.00.20, 7219.33.00.25, 

7219.33.00.35, 7219.33.00.36, 

7219.33.00.38, 7219.33.00.42, 

7219.33.00.44, 7219.34.00.05, 

7219.34.00.20, 7219.34.00.25, 

7219.34.00.30, 7219.34.00.35, 

7219.35.00.05, 7219.35.00.15, 

7219.35.00.30, 7219.35.00.35, 

7219.90.00.10, 7219.90.00.20, 

7219.90.00.25, 7219.90.00.60, 

7219.90.00.80, 7220.12.10.00, 

7220.12.50.00, 7220.20.10.10, 

7220.20.10.15, 7220.20.10.60, 

7220.20.10.80, 7220.20.60.05, 

7220.20.60.10, 7220.20.60.15, 

7220.20.60.60, 7220.20.60.80, 

7220.20.70.05, 7220.20.70.10, 

7220.20.70.15, 7220.20.70.60, 

7220.20.70.80, 7220.20.80.00, 

7220.20.90.30, 7220.20.90.60, 

7220.90.00.10, 7220.90.00.15, 

7220.90.00.60, and 7220.90.00.80. 

Although the HTSUS subheadings are 

provided for convenience and customs 

purposes, the Department’s written 

description of the merchandise under 

review is dispositive. 

Excluded from the scope of this order 

are the following: (1) Sheet and strip 

that is not annealed or otherwise heat 

treated and pickled or otherwise 

descaled; (2) sheet and strip that is cut 

to length; (3) plate (i.e., flat-rolled 

stainless steel products of a thickness of 

4.75 mm or more); (4) flat wire (i.e., 

cold-rolled sections, with a prepared 

edge, rectangular in shape, of a width of 

not more than 9.5 mm); and (5) razor 

blade steel. Razor blade steel is a flatrolled product of stainless steel, not 

further worked than cold-rolled (coldreduced), in coils, of a width of not 

more than 23 mm and a thickness of 

0.266 mm or less, containing, by weight, 

12.5 to 14.5 percent chromium, and 

certified at the time of entry to be used 

in the manufacture of razor blades. See 

Chapter 72 of the HTSUS, ‘‘Additional 

U.S. Note’’ 1(d). 

In response to comments by interested 

parties, the Department has determined 

that certain specialty stainless steel 

products are also excluded from the 

scope of this order. These excluded 

products are described below. 

Flapper valve steel is defined as 

stainless steel strip in coils containing, 

by weight, between 0.37 and 0.43 

percent carbon, between 1.15 and 1.35 

percent molybdenum, and between 0.20 

and 0.80 percent manganese. This steel 

also contains, by weight, phosphorus of 

0.025 percent or less, silicon of between 

0.20 and 0.50 percent, and sulfur of 

0.020 percent or less. The product is 

manufactured by means of vacuum arc 

remelting, with inclusion controls for 

sulphide of no more than 0.04 percent 

and for oxide of no more than 0.05 

percent. Flapper valve steel has a tensile 

strength of between 210 and 300 ksi, 

yield strength of between 170 and 270 

ksi, plus or minus 8 ksi, and a hardness 

(Hv) of between 460 and 590. Flapper 

valve steel is most commonly used to 

produce specialty flapper valves for 

compressors. 

Also excluded is a product referred to 

as suspension foil, a specialty steel 

product used in the manufacture of 

suspension assemblies for computer 

disk drives. Suspension foil is described 

as 302/304 grade or 202 grade stainless 

steel of a thickness between 14 and 127 

microns, with a thickness tolerance of 

plus-or-minus 2.01 microns, and surface 

glossiness of 200 to 700 percent Gs. 

Suspension foil must be supplied in coil 

widths of not more than 407 mm, and 

with a mass of 225 kg or less. Roll marks 

may only be visible on one side, with 

no scratches of measurable depth. The 

material must exhibit residual stresses 

of 2 mm maximum deflection, and 

flatness of 1.6 mm over 685 mm length. 

Certain stainless steel foil for 

automotive catalytic converters is also 

excluded from the scope of this order. 

This stainless steel strip in coils is a 

specialty foil with a thickness of 

between 20 and 110 microns used to 

produce a metallic substrate with a 

honeycomb structure for use in 

automotive catalytic converters. The 

steel contains, by weight, carbon of no 

more than 0.030 percent, silicon of no 

more than 1.0 percent, manganese of no 

more than 1.0 percent, chromium of 

between 19 and 22 percent, aluminum 

of no less than 5.0 percent, phosphorus 

of no more than 0.045 percent, sulfur of 

no more than 0.03 percent, lanthanum 

of between 0.002 and 0.05 percent, and 

total rare earth elements of more than 

0.06 percent, with the balance iron. 

Permanent magnet iron-chromiumcobalt alloy stainless strip is also 

excluded from the scope of this order. 

This ductile stainless steel strip 

contains, by weight, 26 to 30 percent 

chromium, and 7 to 10 percent cobalt, 

with the remainder of iron, in widths 

228.6 mm or less, and a thickness 

between 0.127 and 1.270 mm. It exhibits 

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Federal Register / Vol. 73, No. 152 / Wednesday, August 6, 2008 / Notices 45711 

2 ‘‘Arnokrome III’’ is a trademark of the Arnold 

Engineering Company. 

3 ‘‘Gilphy 36’’ is a trademark of Imphy, S.A. 

4 ‘‘Durphynox 17’’ is a trademark of Imphy, S.A. 

5This list of uses is illustrative and provided for 

descriptive purposes only. 

6 ‘‘GIN4 Mo,’’ ‘‘GIN5’’ and ‘‘GIN6’’ are the 

proprietary grades of Hitachi Metals America, Ltd. 

magnetic remanence between 9,000 and 

12,000 gauss, and a coercivity of 

between 50 and 300 oersteds. This 

product is most commonly used in 

electronic sensors and is currently 

available under proprietary trade names 

such as ‘‘Arnokrome III.’’ 2

Certain electrical resistance alloy steel 

is also excluded from the scope of this 

order. This product is defined as a nonmagnetic stainless steel manufactured to 

American Society of Testing and 

Materials (ASTM) specification B344 

and containing, by weight, 36 percent 

nickel, 18 percent chromium, and 46 

percent iron, and is most notable for its 

resistance to high temperature 

corrosion. It has a melting point of 1390 

degrees Celsius and displays a creep 

rupture limit of 4 kilograms per square 

millimeter at 1000 degrees Celsius. This 

steel is most commonly used in the 

production of heating ribbons for circuit 

breakers and industrial furnaces, and in 

rheostats for railway locomotives. The 

product is currently available under 

proprietary trade names such as ‘‘Gilphy 

36.’’ 3

Certain martensitic precipitationhardenable stainless steel is also 

excluded from the scope of this order. 

This high-strength, ductile stainless 

steel product is designated under the 

Unified Numbering System (UNS) as 

S45500-grade steel, and contains, by 

weight, 11 to 13 percent chromium, and 

7 to 10 percent nickel. Carbon, 

manganese, silicon and molybdenum 

each comprise, by weight, 0.05 percent 

or less, with phosphorus and sulfur 

each comprising, by weight, 0.03 

percent or less. This steel has copper, 

niobium, and titanium added to achieve 

aging, and will exhibit yield strengths as 

high as 1700 Mpa and ultimate tensile 

strengths as high as 1750 Mpa after 

aging, with elongation percentages of 3 

percent or less in 50 mm. It is generally 

provided in thicknesses between 0.635 

and 0.787 mm, and in widths of 25.4 

mm. This product is most commonly 

used in the manufacture of television 

tubes and is currently available under 

proprietary trade names such as 

‘‘Durphynox 17.’’ 4

Finally, three specialty stainless steels 

typically used in certain industrial 

blades and surgical and medical 

instruments are also excluded from the 

scope of this order. These include 

stainless steel strip in coils used in the 

production of textile cutting tools (e.g., 

carpet knives).5 This steel is similar to 

ASTM grade 440F, but containing, by 

weight, 0.5 to 0.7 percent of 

molybdenum. The steel also contains, 

by weight, carbon of between 1.0 and 

1.1 percent, sulfur of 0.020 percent or 

less, and includes between 0.20 and 

0.30 percent copper and between 0.20 

and 0.50 percent cobalt. This steel is 

sold under proprietary names such as 

‘‘GIN4 Mo.’’ The second excluded 

stainless steel strip in coils is similar to 

AISI 420–J2 and contains, by weight, 

carbon of between 0.62 and 0.70 

percent, silicon of between 0.20 and 

0.50 percent, manganese of between 

0.45 and 0.80 percent, phosphorus of no 

more than 0.025 percent and sulfur of 

no more than 0.020 percent. This steel 

has a carbide density on average of 100 

carbide particles per square micron. An 

example of this product is ‘‘GIN5’’ steel. 

The third specialty steel has a chemical 

composition similar to AISI 420 F, with 

carbon of between 0.37 and 0.43 

percent, molybdenum of between 1.15 

and 1.35 percent, but lower manganese 

of between 0.20 and 0.80 percent, 

phosphorus of no more than 0.025 

percent, silicon of between 0.20 and 

0.50 percent, and sulfur of no more than 

0.020 percent. This product is supplied 

with a hardness of more than Hv 500 

guaranteed after customer processing, 

and is supplied as, for example, 

‘‘GIN6.’’ 6

Sales Made Through Affiliated 

Resellers 

A. U.S. Market 

Mexinox USA, a wholly-owned 

subsidiary of Mexinox S.A., which in 

turn is a subsidiary of ThyssenKrupp 

AG, sold subject merchandise in the 

United States during the POR to 

unaffiliated customers. Mexinox USA 

also made sales of subject merchandise 

to U.S. affiliate Ken-Mac which is an 

operating division of ThyssenKrupp 

Materials Inc., which is a subsidiary of 

ThyssenKrupp USA, Inc., the primary 

holding company for ThyssenKrupp AG 

in the U.S. market. Ken-Mac purchased 

subject merchandise from Mexinox USA 

and further manufactured and/or resold 

the subject merchandise to unaffiliated 

customers in the United States during 

the POR. See Mexinox’s October 3, 

2007, section A questionnaire response 

at 13, 22 and 29. For purposes of this 

review, we have included both Mexinox 

USA’s and Ken-Mac’s sales of subject 

merchandise to unaffiliated customers 

in the United States in our margin 

calculation. 

B. Home Market 

Mexinox Trading, S.A. de C.V. 

(Mexinox Trading), a wholly owned 

subsidiary of Mexinox S.A., resold the 

foreign like product as well as other 

merchandise in the home market. 

Mexinox S.A.’s sales to Mexinox 

Trading represented a small portion of 

Mexinox S.A.’s total sales of the foreign 

like product in the home market and 

constituted less than five percent of all 

home market sales. See, e.g., Mexinox’s 

October 3, 2007, section A questionnaire 

response at 3, and its April 7, 2008, 

supplemental questionnaire response 

covering sections A through C at 

Attachment A–26 (quantity and value 

chart). Because sales to Mexinox 

Trading of the foreign like product were 

below the five percent threshold 

established under 19 CFR 351.403(d), 

we did not require Mexinox S.A. to 

report Mexinox Trading’s downstream 

sales to its first unaffiliated customer. 

This is consistent with our practice to 

date and the methodology we have 

employed in past administrative 

reviews of S4 in coils from Mexico. See, 

e.g., Stainless Steel Sheet and Strip in 

Coils from Mexico; Final Results of 

Antidumping Duty Administrative 

Review, 73 FR 7710 (February 11, 2008) 

(2005–2006 Final Results), as amended, 

Stainless Steel Sheet and Strip in Coils 

from Mexico: Amended Final Results of 

Antidumping Duty Administrative 

Review, 73 FR 14215 (March 17, 2008) 

(2005–2006 Amended Final Results. See 

also Stainless Steel Sheet and Strip in 

Coils from Mexico; Final Results of 

Antidumping Duty Administrative 

Review, 70 FR 73444 (December 12, 

2005) and accompanying Issues and 

Decisions Memorandum at Comment 2. 

Fair Value Comparisons 

To determine whether sales of S4 in 

coils from Mexico to the United States 

were made at less than fair value, we 

compared CEP sales made in the United 

States by both Mexinox USA and KenMac to unaffiliated purchasers to NV as 

described in the ‘‘Constructed Export 

Price’’ and ‘‘Normal Value’’ sections of 

this notice, below. In accordance with 

section 777A(d)(2) of the Tariff Act of 

1930, as amended (the Tariff Act), we 

compared individual CEPs to monthly 

weighted-average NVs. 

Product Comparisons 

In accordance with section 771(16) of 

the Tariff Act we considered all 

products produced by Mexinox S.A. 

covered by the description in the 

‘‘Scope of the Order’’ section above, and 

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sold in the home market during the 

POR, to be foreign like product for 

purposes of determining appropriate 

product comparisons to U.S. sales. We 

relied on nine characteristics to match 

U.S. sales of subject merchandise to 

comparison sales of the foreign like 

product (listed in order of priority): (1) 

Grade; (2) cold/hot rolled; (3) gauge; (4) 

surface finish; (5) metallic coating; (6) 

non-metallic coating; (7) width; (8) 

temper; and (9) edge trim. Where there 

were no sales of identical merchandise 

in the home market to compare to U.S. 

sales, we compared U.S. sales to the 

next most similar foreign like product 

on the basis of the characteristics and 

reporting instructions listed in the 

Department’s original September 11, 

2007, questionnaire. 

Level of Trade 

In accordance with section 

773(a)(1)(B) of the Tariff Act, to the 

extent practicable, we base NV on sales 

made in the comparison market at the 

same level of trade (LOT) as the export 

transaction. The NV LOT is based on the 

starting price of sales in the home 

market or, when NV is based on 

constructed value (CV), that of the sales 

from which selling, general, and 

administrative (SG&A) expenses and 

profit are derived. With respect to CEP 

transactions in the U.S. market, the CEP 

LOT is defined as the level of the 

constructed sale from the exporter to the 

importer. See section 773(a)(7)(A) of the 

Tariff Act. 

To determine whether NV sales are at 

a different LOT than CEP sales, we 

examine stages in the marketing process 

and selling functions along the chain of 

distribution between the producer and 

the customer. See 19 CFR 351.412(c)(2). 

If the comparison-market sales are at a 

different LOT, and the difference affects 

price comparability, as manifested in a 

pattern of consistent price differences 

between the sales on which NV is based 

and comparison-market sales at the LOT 

of the export transaction, we make a 

LOT adjustment under section 

773(a)(7)(A) of the Tariff Act. For CEP 

sales, if the NV level is more remote 

from the factory than the CEP level and 

there is no basis for determining 

whether the difference in the levels 

between NV and CEP affects price 

comparability, we adjust NV under 

section 773(a)(7)(B) of the Tariff Act (the 

CEP offset provision). See, e.g., Final 

Determination of Sales at Less Than 

Fair Value: Greenhouse Tomatoes From 

Canada, 67 FR 8781 (February 26, 2002) 

and accompanying Issues and Decisions 

Memorandum at Comment 8; see also 

Certain Hot-Rolled Flat-Rolled Carbon 

Quality Steel Products from Brazil; 

Preliminary Results of Antidumping 

Duty Administrative Review, 70 FR 

17406, 17410 (April 6, 2005), 

unchanged in Notice of Final Results of 

Antidumping Duty Administrative 

Review of Certain Hot-Rolled Flat-Rolled 

Carbon Quality Steel Products from 

Brazil, 70 FR 58683 (October 7, 2005). 

For CEP sales, we consider only the 

selling activities reflected in the price 

after the deduction of expenses and CEP 

profit under section 772(d) of the Tariff 

Act. See Micron Technology, Inc. v. 

United States, 243 F.3d 1301, 1314–

1315 (Fed. Cir. 2001). We expect that if 

the claimed LOTs are the same, the 

functions and activities of the seller 

should be similar. Conversely, if a party 

claims the LOTs are different for 

different groups of sales, the functions 

and activities of the seller should be 

dissimilar. See Porcelain-on-Steel 

Cookware from Mexico: Final Results of 

Administrative Review, 65 FR 30068 

(May 10, 2000) and accompanying 

Issues and Decisions Memorandum at 

Comment 6. 

We obtained information from 

Mexinox regarding the marketing stages 

involved in making its reported home 

market and U.S. sales to both affiliated 

and unaffiliated customers. Mexinox 

provided a description of all selling 

activities performed, along with a 

flowchart and tables comparing the 

levels of trade among each channel of 

distribution and customer category for 

both markets. See Mexinox’s October 3, 

2007, section A questionnaire response 

at 33 through 39 and Attachments A–4–

A through A–4–C; see also Mexinox’s 

February 1, 2008, supplemental section 

A questionnaire response at 21 through 

24 and Attachments A–20–A and A–20–

B. 

Mexinox sold S4 in coils to end-users 

and retailers/distributors in the home 

market and to end-users and 

distributors/service centers in the 

United States. For the home market, 

Mexinox identified two channels of 

distribution described as follows: (1) 

direct shipments (i.e., products 

produced to order) and (2) sales from 

inventory. Within each of these two 

channels of distribution, Mexinox S.A. 

made sales to affiliated and unaffiliated 

distributors/retailers and end-users. See 

Mexinox’s October 3, 2007, section A 

questionnaire response at 3 and 26 

through 27. We reviewed the intensity 

of all selling functions Mexinox claimed 

to perform for each channel of 

distribution and customer category. For 

certain functions, such as pre-sale 

technical assistance, processing of 

customer orders, sample analysis, 

prototypes and trial lots, freight and 

delivery, price negotiation/customer 

communications, sales calls and visits, 

and warranty services, the level of 

performance for both direct shipments 

and sales through inventory was 

identical across all types of customers. 

Only a few functions exhibited 

differences, including inventory 

maintenance/just-in-time performance, 

further processing, credit and collection, 

low volume orders and shipment of 

small packages. See Mexinox’s February 

1, 2008, supplemental section A 

questionnaire response at Attachment 

A–20. While we find differences in the 

levels of intensity performed for some of 

these functions, such differences are 

minor and do not establish distinct 

levels of trade in Mexico. Based on our 

analysis of all of Mexinox S.A.’s home 

market selling functions, we find all 

home market sales were made at the 

same LOT, the NV LOT. 

We then compared the NV LOT, based 

on the selling functions associated with 

the transactions between Mexinox S.A. 

and its customers in the home market, 

to the CEP LOT, which is based on the 

selling functions associated with the 

transaction between Mexinox S.A. and 

its affiliated importer, Mexinox USA. 

Our analysis indicates the selling 

functions performed for home market 

customers are either performed at a 

higher degree of intensity or are greater 

in number than the selling functions 

performed for Mexinox USA. See 

Mexinox’s October 3, 2007 section A 

questionnaire response at 33 through 39 

and Attachments A–4–A through A–4–

C; see also Mexinox’s February 1, 2008, 

supplemental section A questionnaire 

response at 21 through 24 and 

Attachment A–20. For example, in 

comparing Mexinox’s selling functions, 

we find there are more functions 

performed in the home market which 

are not a part of CEP transactions (e.g., 

pre-sale technical assistance, sample 

analysis, prototypes and trial lots, price 

negotiation/customer communications, 

sales calls and visits, credit and 

collection, and warranty services). For 

selling functions performed for both 

home market sales and CEP sales (e.g., 

processing customer orders, freight and 

delivery arrangements), we find 

Mexinox S.A. actually performed each 

activity at a higher level of intensity in 

the home market. Based on Mexinox’s 

responses, we note that CEP sales from 

Mexinox S.A. to Mexinox USA 

generally occur at the beginning of the 

distribution chain, representing 

essentially a logistical transfer of 

inventory that resembles ex-factory 

sales. In contrast, all sales in the home 

market occur closer to the end of the 

distribution chain and involve smaller 

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volumes and more customer interaction 

which, in turn, require the performance 

of more selling functions. See Mexinox’s 

October 3, 2007, section A questionnaire 

response at 33 through 39 and 

Attachments A–4–A through A–4–C; see 

also Mexinox’s February 1, 2008, 

supplemental section A questionnaire 

response at Attachment A–20. Based on 

the foregoing, we conclude the NV LOT 

is at a more advanced stage than the 

CEP LOT. 

Because we found the home market 

and U.S. sales were made at different 

LOTs, we examined whether a LOT 

adjustment or a CEP offset may be 

appropriate in this review. As we found 

only one LOT in the home market, it 

was not possible to make a LOT 

adjustment to home market sales, 

because such an adjustment is 

dependent on our ability to identify a 

pattern of consistent price differences 

between the home market sales on 

which NV is based and home market 

sales at the LOT of the export 

transaction. See 19 CFR 

351.412(d)(1)(ii). Furthermore, we have 

no other information that provides an 

appropriate basis for determining a LOT 

adjustment. Because the data available 

do not form an appropriate basis for 

making a LOT adjustment, and because 

the NV LOT is at a more advanced stage 

of distribution than the CEP LOT, we 

have made a CEP offset to NV in 

accordance with section 773(a)(7)(B) of 

the Tariff Act. 

Constructed Export Price 

Mexinox indicated it made CEP sales 

through its U.S. affiliate, Mexinox USA, 

in the following four channels of 

distribution: (1) Direct shipments to 

unaffiliated customers; (2) stock sales 

from the San Luis Potosi (SLP) factory; 

(3) sales to unaffiliated customers 

through Mexinox USA’s warehouse 

inventory; and (4) sales through KenMac. See Mexinox’s October 3, 2007, 

section A questionnaire response at 27 

through 31. Ken-Mac is an affiliated 

service center located in the United 

States which purchases S4 in coils 

produced by Mexinox S.A. and then 

resells the merchandise (after, in some 

instances, further manufacturing) to 

unaffiliated U.S. customers. 

In accordance with section 772(b) of 

the Tariff Act, CEP is the price at which 

the subject merchandise is first sold (or 

agreed to be sold) in the United States 

before or after the date of importation by 

or for the account of the producer or 

exporter of such merchandise, or by a 

seller affiliated with the producer or 

exporter, to a purchaser not affiliated 

with the producer or exporter. We find 

Mexinox properly classified all of its 

U.S. sales of subject merchandise as CEP 

transactions because such sales were 

made in the United States through 

Mexinox USA or Ken-Mac to 

unaffiliated purchasers. We based CEP 

on packed prices to unaffiliated 

purchasers in the United States sold by 

Mexinox USA or its affiliated reseller, 

Ken-Mac. We made adjustments for 

billing adjustments, discounts and 

rebates where applicable. We also made 

deductions for movement expenses in 

accordance with section 772(c)(2)(A) of 

the Tariff Act. These expenses included, 

where appropriate: foreign inland 

freight, foreign brokerage and handling, 

inland insurance, U.S. customs duties, 

U.S. inland freight, U.S. brokerage, and 

U.S. warehousing expenses. As directed 

by section 772(d)(1) of the Tariff Act, we 

deducted those selling expenses 

associated with economic activities 

occurring in the United States, 

including direct selling expenses (i.e., 

credit costs, warranty expenses, and a 

certain expense of proprietary nature), 

commissions, inventory carrying costs, 

and other indirect selling expenses. We 

also made an adjustment for profit in 

accordance with section 772(d)(3) of the 

Tariff Act. We used the expenses as 

reported by Mexinox made in 

connection with its U.S. sales, with the 

exception of the U.S. indirect selling 

expense ratio which we recalculated. 

See ‘‘Analysis of Data Submitted by 

ThyssenKrupp Mexinox S.A. de C.V. for 

the Preliminary Results of the 

Antidumping Duty Administrative 

Review of S4 in Coils from Mexico’’

(Preliminary Analysis Memorandum) 

from Maryanne Burke, Trade Analyst, to 

the File, dated July 30, 2008. 

For sales in which the material was 

sent to an unaffiliated U.S. processor, 

we made an adjustment based on the 

transaction-specific further-processing 

expenses incurred by Mexinox USA. In 

addition, the U.S. affiliated reseller KenMac performed some further 

manufacturing for its sales to 

unaffiliated U.S. customers. For these 

sales, we deducted the cost of further 

processing in accordance with section 

772(d)(2) of the Tariff Act. In calculating 

the cost of further manufacturing for 

Ken-Mac, we relied upon Ken-Mac’s 

reported cost of further manufacturing 

materials, labor and overhead. We also 

included amounts for further 

manufacturing general and 

administrative expenses (G&A), as 

reported in Mexinox’s May 19, 2008, 

supplemental section D questionnaire 

response. 

Normal Value 

A. Selection of Comparison Market 

To determine whether there is a 

sufficient volume of sales in the home 

market to serve as a viable basis for 

calculating NV (i.e., the aggregate 

volume of home market sales of the 

foreign like product is greater than five 

percent of the aggregate volume of U.S. 

sales), we compared Mexinox’s volume 

of home market sales of the foreign like 

product to the volume of its U.S. sales 

of the subject merchandise, in 

accordance with section 773(a)(1)(B) of 

the Tariff Act. Because Mexinox’s 

aggregate volume of home market sales 

of the foreign like product was greater 

than five percent of its aggregate volume 

of U.S. sales for subject merchandise, 

we determined the home market was 

viable. See, e.g., Mexinox’s April 7, 

2008, supplemental questionnaire 

response covering sections A through C 

and E at Attachment A–26. 

B. Affiliated-Party Transactions and 

Arm’s-Length Test 

Sales to affiliated customers in the 

home market not made at arm’s-length 

prices are excluded from our analysis 

because we consider them to be outside 

the ordinary course of trade. See section 

773(f)(2) of the Tariff Act; see also 19 

CFR 351.102(b). Consistent with 19 CFR 

351.403(c) and (d) and agency practice, 

‘‘the Department may calculate NV 

based on sales to affiliates if satisfied 

that the transactions were made at arm’s 

length.’’ See China Steel Corp. v. United 

States, 264 F. Supp. 2d 1339, 1365 (CIT 

2003). To test whether the sales to 

affiliates were made at arm’s-length 

prices, we compared, on a modelspecific basis, the starting prices of sales 

to affiliated and unaffiliated customers, 

net of all direct selling expenses, billing 

adjustments, discounts and rebates, 

movement charges and packing. Where 

prices to the affiliated party were, on 

average, within a range of 98 to 102 

percent of the price of identical or 

comparable merchandise to the 

unaffiliated parties, we determined that 

the sales made to the affiliated party 

were at arm’s length. See Antidumping 

Proceedings: Affiliated Party Sales in 

the Ordinary Course of Trade, 67 FR 

69186, 69194 (November 15, 2002). We 

found both affiliated home market 

customers failed the arm’s length test 

and, in accordance with the 

Department’s practice, we excluded 

sales to these affiliates from our 

analysis. 

C. Cost of Production Analysis 

Because we disregarded sales of 

certain products made at prices below 

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the cost of production (COP) in the most 

recently completed review of S4 in coils 

from Mexico (see Stainless Steel Sheet 

and Strip in Coils from Mexico; 

Preliminary Results of Antidumping 

Duty Administrative Review, 71 FR 

35618, 35623 (June 21, 2006), 

unchanged in Stainless Steel Sheet and 

Strip in Coils from Mexico; Final Results 

of Antidumping Duty Administrative 

Review, 71 FR 76978 (December 22, 

2006) (2004–2005 Final Results) we had 

reasonable grounds to believe or suspect 

that sales of the foreign like product 

under consideration for the 

determination of NV in this review for 

Mexinox may have been made at prices 

below the COP, as provided by section 

773(b)(2)(A)(ii) of the Tariff Act. 

Pursuant to section 773(b)(1) of the 

Tariff Act, we initiated a COP 

investigation of sales by Mexinox. We 

relied on home market sales and COP 

information provided by Mexinox in its 

questionnaire responses, except where 

noted below: 

ThyssenKrupp Nirosta GmbH (TKN) 

and ThyssenKrupp AST, S.p.A. 

(TKAST), hot band producers affiliated 

with Mexinox, sold hot band to 

Mexinox USA, which in turn sold hot 

band to Mexinox S.A. Hot band is 

considered a major input to the 

production of S4 in coils. Section 

773(f)(3) of the Tariff Act, (the major 

input rule) states: 

‘‘in the case of a transaction between 

affiliated persons involving the production 

by one of such persons of a major input to 

the merchandise, the administering authority 

has reasonable grounds to believe or suspect 

that an amount represented as the value of 

such input is less than the cost of production 

of such input, then the administering 

authority may determine the value of the 

major input on the basis of the information 

available regarding such cost of production, 

if such cost is greater than the amount that 

would be determined for such input under 

paragraph (2).’’

Paragraph 2 of section 773(f) 

(transactions disregarded) states: 

‘‘a transaction directly or indirectly between 

affiliated persons may be disregarded if, in 

the case of any element of value required to 

be considered, the amount representing that 

element does not fairly reflect the amount 

usually reflected in sales of merchandise 

under consideration in the market under 

consideration. If a transaction is disregarded 

under the preceding sentence and no other 

transactions are available for consideration, 

the determination of the amount shall be 

based on the information available as to what 

the amount would have been if the 

transaction had occurred between persons 

who are not affiliated.’’

In accordance with the major input rule, 

and as stated in 2005–2006 Final 

Results, it is the Department’s normal 

practice to use all three elements of the 

major input rule (i.e., transfer price, 

COP and market price) where available. 

For these preliminary results, we 

evaluated the transfer prices between 

Mexinox and its affiliated hot band 

suppliers on a grade-specific basis. For 

certain grades of hot band, all three 

elements of the major input analysis 

were available. These grades of hot band 

account for the majority of volume of 

hot band that Mexinox purchased from 

TKN and TKAST during the POR. As 

such, we find these purchases provide 

a reasonable basis for the Department to 

measure the preferential treatment, if 

any, given to Mexinox for purchases of 

hot band from TKN and TKAST during 

the POR. Therefore, we adjusted the 

reported costs to reflect the higher of 

transfer prices, COP, or market prices of 

hot band, where available. Additionally, 

we relied on these results to adjust the 

reported cost for grades where all three 

elements of the major input were not 

available. See the Department’s Cost of 

Production and Constructed Value 

Calculation Adjustments for the 

Preliminary Results—ThyssenKrupp 

Mexinox S.A. de C.V. from LaVonne 

Clark, Senior Accountant, to Neal M. 

Halper, Director, Office of Accounting, 

dated July 30, 2008 (Cost Calculation 

Memorandum). 

In certain cases, where market prices 

have not been available, the Department 

has constructed market prices in order 

to perform the major input analysis. See 

Certain Polyester Staple Fiber from 

Korea: Final Results of the 2005–2006 

Antidumping Duty Administrative 

Review, 72 FR 69663 (December 10, 

2007) (PSF from Korea) and 

accompanying Issues and Decision 

Memorandum at Comment 5 and 

Certain Hot-Rolled Carbon Steel Flat 

Product from Thailand: Final Results of 

Antidumping Duty Administrative 

Review and Partial Rescission of 

Antidumping Duty Administrative 

Review, 72 FR 27802 (May 17, 2007) 

(Carbon Steel Flat Products from 

Thailand) and accompany Issues and 

Decision Memorandum at Comment 3. 

In the instant case we have applied the 

results of our analysis of those grades 

where market prices were available to 

those grades where market prices were 

not available. We find this approach to 

be reasonable because the grades where 

market prices are available constitute 

the majority of hot band purchased by 

Mexinox from the affiliated parties. As 

such, these purchases provide 

reasonable grounds to determine the 

arm’s length nature of purchases 

between Mexinox and its affiliates 

during the POR. For further details, see 

Cost Calculation Memorandum. 

Because we have determined that 

shorter cost periods are appropriate for 

the COP analysis of austenitic grades, 

we have performed the cost-based part 

of the major input analysis by quarter 

for all grades of austenitic hot band. For 

all other grades of hot band, we have 

performed the cost-based part of the 

major input analysis on a POR basis. 

We also revised Mexinox’s reported 

COP to include depreciation expenses 

related to a newly installed production 

line. We recalculated Mexinox’s G&A 

expense rate to include employee profit 

sharing in the numerator, and adjusted 

for a certain provision accounted for 

during a prior period. We revised 

Mexinox’s financial expense ratio to 

exclude certain interest income from 

accounts receivable and adjusted 

ThyssenKrupp AG’s cost of goods sold 

to exclude packing expenses. See Cost 

Calculation Memorandum. 

In determining whether to disregard 

home market sales made at prices below 

the COP, we examined, in accordance 

with sections 773(b)(1)(A) and (B) of the 

Tariff Act, whether, within an extended 

period of time, such sales were made in 

substantial quantities, and whether such 

sales were made at prices which 

permitted the recovery of all costs 

within a reasonable period of time in 

the normal course of trade. As noted in 

section 773(b)(1)(D) of the Tariff Act, 

prices are considered to provide for 

recovery of costs if such prices are 

above the weighted average per-unit 

COP for the period of investigation or 

review. In the instant case, we have 

relied on Mexinox’s reported quarterly 

costs of austenitic grades of 

merchandise. Mexinox calculated the 

reported quarterly costs using a 

methodology that is similar to that used 

by the Department in cases of highinflation (see e.g. Notice of Final 

Determination of Sales at Less Than 

Fair Value: Certain Cut-to-Length 

Carbon-Quality Steel Plate Products 

from Indonesia, 64 FR 73164 (December 

29, 1999) at Comment 1). Because this 

methodology restates the quarterly costs 

on an equivalent basis, by calculating an 

annual weighted-average COP for the 

POR and then restating it to each 

respective quarter, we find Mexinox’s 

reported quarterly costs meet the 

requirements of section 773(b)(1)(D) of 

the Tariff Act. 

Where less than 20 percent of the 

respondent’s home market sales of a 

given model were at prices below the 

COP, we did not disregard any belowcost sales of that model because we 

determined that the below-cost sales 

were not made within an extended 

period of time and in ‘‘substantial 

quantities.’’ Where 20 percent or more 

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of the respondent’s home market sales 

of a given model were at prices less than 

the COP, we disregarded the below-cost 

sales because: (1) they were made 

within an extended period of time in 

‘‘substantial quantities,’’ in accordance 

with sections 773(b)(2)(B) and (C) of the 

Tariff Act; and (2) based on our 

comparison of prices to the weightedaverage COPs for the POR, they were at 

prices which would not permit the 

recovery of all costs within a reasonable 

period of time, in accordance with 

section 773(b)(2)(D) of the Tariff Act. 

Our cost test for Mexinox revealed 

that, for home market sales of certain 

models, less than 20 percent of the sales 

of those models were at prices below the 

COP. We therefore retained all such 

sales in our analysis and used them as 

the basis for determining NV. Our cost 

test also indicated that for home market 

sales of other models, more than 20 

percent were sold at prices below the 

COP within an extended period of time 

and were at prices which would not 

permit the recovery of all costs within 

a reasonable period of time. Thus, in 

accordance with section 773(b)(1) of the 

Tariff Act, we excluded these belowcost sales from our analysis and used 

the remaining above-cost sales as the 

basis for determining NV. 

D. Constructed Value 

In accordance with section 773(e) of 

the Tariff Act, we calculated CV based 

on the sum of Mexinox’s material and 

fabrication costs, SG&A expenses, profit, 

and U.S. packing costs. We calculated 

the COP component of CV as described 

above in the ‘‘Cost of Production 

Analysis’’ section of this notice. In 

accordance with section 773(e)(2)(A) of 

the Tariff Act, we based SG&A expenses 

and profit on the amounts incurred and 

realized by the respondent in 

connection with the production and sale 

of the foreign like product in the 

ordinary course of trade, for 

consumption in the foreign country. 

E. Price-to-Price Comparisons 

We calculated NV based on prices to 

unaffiliated customers or prices to 

affiliated customers we determined to 

be at arm’s length. Mexinox S.A. 

reported home market sales in Mexican 

pesos, but noted certain home market 

sales were invoiced in U.S. dollars 

during the POR. See Mexinox’s October 

29, 2007, section B questionnaire 

response at B–26 and B–27. In our 

margin calculation we used the 

currency of the sale invoice at issue and 

applied the relevant adjustments in the 

actual currency invoiced or incurred by 

Mexinox. We accounted for billing 

adjustments, discounts, and rebates, 

where appropriate. We also made 

deductions, where appropriate, for 

foreign inland freight, insurance, 

handling, and warehousing, pursuant to 

section 773(a)(6)(B) of the Tariff Act. In 

addition, we made adjustments for 

differences in cost attributable to 

differences in physical characteristics of 

the merchandise compared pursuant to 

section 773(a)(6)(C)(ii) of the Tariff Act 

and 19 CFR 351.411. We also made 

adjustments for differences in 

circumstances of sale (COS) in 

accordance with section 773(a)(6)(C)(iii) 

of the Tariff Act and 19 CFR 351.410. 

We made COS adjustments for imputed 

credit expenses and warranty expenses. 

As noted above in the ‘‘Level of Trade’’

section of this notice, we also made an 

adjustment for the CEP offset in 

accordance with section 773(a)(7)(B) of 

the Tariff Act. Finally, we deducted 

home market packing costs and added 

U.S. packing costs in accordance with 

sections 773(a)(6)(A) and (B) of the 

Tariff Act. 

We used Mexinox’s home market 

adjustments and deductions as reported, 

except for certain handling expenses 

and imputed credit expenses. We have 

recalculated the handling expenses 

incurred by Mexinox’s home market 

affiliate, Mexinox Trading, and applied 

the revised ratio to those home market 

sales for which Mexinox reported a 

handling expense. We calculated 

imputed credit expenses based on the 

short-term borrowing rate associated 

with the currency of each home market 

sale transaction. See Preliminary 

Analysis Memorandum. Our 

methodology for calculating handling 

charges and imputed credit expenses is 

consistent with past administrative 

reviews of this case. See, e.g., 2005–

2006 Final Results, as amended, and 

2004–2005 Final Results. 

F. Price-to-CV Comparisons 

Where we were unable to find a home 

market match of such or similar 

merchandise, in accordance with 

section 773(a)(4) of the Tariff Act, we 

based NV on CV. Where appropriate, we 

made adjustments to CV in accordance 

with section 773(a)(8) of the Tariff Act. 

Currency Conversion 

We made currency conversions into 

U.S. dollars based on the exchange rates 

in effect on the dates of the U.S. sales, 

as certified by the Federal Reserve Bank, 

in accordance with section 773A(a) of 

the Tariff Act. 

Preliminary Results of Review 

As a result of our review we 

preliminarily determine the following 

weighted-average dumping margin 

exists for the period July 1, 2006 

through June 30, 2007: 

Manufacturer exporter 

Weighted 

average 

margin 

(percentage) 

ThyssenKrupp Mexinox S.A. 

de C.V. .............................. 2.87 

The Department will disclose 

calculations performed within five days 

of the date of publication of this notice 

in accordance with 19 CFR 351.224(b). 

An interested party may request a 

hearing within thirty days of 

publication of these preliminary results. 

See 19 CFR 351.310(c). Any hearing, if 

requested, will be held 37 days after the 

date of publication, or the first business 

day thereafter, unless the Department 

alters the date per 19 CFR 351.310(d). 

Interested parties may submit case briefs 

no later than 30 days after the date of 

publication of these preliminary results 

of review. See 19 CFR 351.309(c). 

Rebuttal briefs limited to issues raised 

in the case briefs may be filed no later 

than five days after the time limit for 

submitting the case briefs. See 19 CFR 

351.309(d). Parties who submit 

argument in these proceedings are 

requested to submit with the argument: 

(1) A statement of the issue, (2) a brief 

summary of the argument and (3) a table 

of authorities. Further, parties 

submitting case briefs and/or rebuttal 

briefs are requested to provide the 

Department with an additional copy of 

the public version of any such argument 

on diskette. The Department will issue 

final results of this administrative 

review, including the results of our 

analysis of the issues in any such 

argument or at a hearing, within 120 

days of publication of these preliminary 

results. 

Duty Assessment 

Upon completion of this 

administrative review, the Department 

shall determine, and United States 

Customs and Border Protection (CBP) 

shall assess, antidumping duties on all 

appropriate entries. In accordance with 

19 CFR 351.212(b)(1), we will calculate 

importer-specific ad valorem 

assessment rates for the merchandise 

based on the ratio of the total amount of 

antidumping duties calculated for the 

examined sales made during the POR to 

the total customs value of the sales used 

to calculate those duties. The total 

customs value is based on the entered 

value reported by Mexinox for all U.S. 

entries of subject merchandise initially 

purchased for consumption to the 

United States made during the POR. See 

Preliminary Analysis Memorandum. In 

mstockstill on PROD1PC66 with NOTICES

45716 Federal Register / Vol. 73, No. 152 / Wednesday, August 6, 2008 / Notices 

1New World Pasta Company; Dakota Growers 

Pasta Company; and American Italian Pasta 

Company. 

2See Memorandum to Melissa Skinner, Director, 

Office 3, from Team regarding Selection of 

Respondents for Individual Review, October 15, 

2007. 

accordance with 19 CFR 356.8(a), the 

Department intends to issue assessment 

instructions to CBP on or after 41 days 

following the publication of the final 

results of review. 

The Department clarified its 

‘‘automatic assessment’’ regulation on 

May 6, 2003. See Antidumping and 

Countervailing Duty Proceedings: 

Assessment of Antidumping Duties, 68 

FR 23954 (May 6, 2003). This 

clarification will apply to entries of 

subject merchandise during the POR 

produced by the company included in 

these preliminary results for which the 

reviewed company did not know their 

merchandise was destined for the 

United States. In such instances, we will 

instruct CBP to liquidate unreviewed 

entries at the all-others rate if there is no 

rate for the intermediate company or 

companies involved in the transaction. 

Cash Deposit Requirements 

Furthermore, the following cash 

deposit requirements will be effective 

for all shipments of S4 in coils from 

Mexico entered, or withdrawn from 

warehouse, for consumption on or after 

the publication date of the final results 

of this administrative review, as 

provided by section 751(a)(2)(C) of the 

Tariff Act: (1) The cash deposit rate for 

the reviewed company will be the rate 

established in the final results of this 

review, except if the rate is less than 

0.50 percent (de minimis within the 

meaning of 19 CFR 351.106(c)(1)), the 

cash deposit will be zero; (2) for 

previously investigated companies not 

listed above, the cash deposit rate will 

continue to be the company-specific rate 

published for the most recent period; (3) 

if the exporter is not a firm covered in 

this review, or the original less than fair 

value (LTFV) investigation, but the 

manufacturer is, the cash deposit rate 

will be the rate established for the most 

recent period for the manufacturer of 

the merchandise; and (4) the cash 

deposit rate for all other manufacturers 

or exporters will continue to be the allothers rate of 30.85 percent, which is 

the all-others rate established in the 

LTFV investigation. See Notice of 

Amended Final Determination of Sales 

at Less Than Fair Value and 

Antidumping Duty Order; Stainless 

Steel Sheet and Strip in Coils from 

Mexico, 64 FR 40560 (July 27, 1999). 

These deposit requirements, when 

imposed, shall remain in effect until 

publication of the final results of the 

next administrative review. 

Notification to Importers 

This notice serves as a preliminary 

reminder to importers of their 

responsibility under 19 CFR 

351.402(f)(2) to file a certificate 

regarding the reimbursement of 

antidumping duties prior to liquidation 

of the relevant entries during this 

review period. Failure to comply with 

this requirement could result in the 

Secretary’s presumption that 

reimbursement of antidumping duties 

occurred and the subsequent assessment 

of double antidumping duties. 

We are issuing and publishing this 

notice in accordance with sections 

751(a)(1) and 777(i) of the Tariff Act. 

Dated: July 30, 2008. 

David M. Spooner, 

Assistant Secretary for Import 

Administration. 

[FR Doc. E8–17987 Filed 8–5–08; 8:45 am] 

BILLING CODE 3510–DS–P 

DEPARTMENT OF COMMERCE 

International Trade Administration 

[A–475–818] 

Certain Pasta From Italy: Notice of 

Preliminary Results of Eleventh 

Antidumping Duty Administrative 

Review 

AGENCY: Import Administration, 

International Trade Administration, 

Department of Commerce. 

SUMMARY: In response to requests by 

interested parties, the Department of 

Commerce (‘‘the Department’’) is 

conducting an administrative review of 

the antidumping duty order on certain 

pasta (‘‘pasta’’) from Italy for the period 

of review (‘‘POR’’) July 1, 2006, through 

June 30, 2007. This review covers four 

producers/exporters of subject 

merchandise. We preliminarily 

determine that during the POR, 

respondents sold subject merchandise at 

less than normal value (‘‘NV’’). If these 

preliminary results are adopted in the 

final results of this administrative 

review, we will instruct U.S. Customs 

and Border Protection (‘‘CBP’’) to assess 

antidumping duties on all appropriate 

entries of subject merchandise during 

the POR. 

Interested parties are invited to 

comment on these preliminary results. 

EFFECTIVE DATE: August 6, 2008. 

FOR FURTHER INFORMATION CONTACT: 

Christopher Hargett (Divella) or 

Stephanie Moore (Zara) , AD/CVD 

Operations, Office 3, Import 

Administration, International Trade 

Administration, U.S. Department of 

Commerce, 14th Street and Constitution 

Avenue, NW., Washington, DC 20230; 

telephone: (202) 482–4161 or (202) 482–

3692, respectively. 

SUPPLEMENTARY INFORMATION: 

Background 

On July 24, 1996, the Department 

published in the Federal Register the 

antidumping duty order on pasta from 

Italy. See Notice of Antidumping Duty 

Order and Amended Final 

Determination of Sales at Less Than 

Fair Value: Certain Pasta From Italy, 61 

FR 38547 (July 24, 1996). 

On July 3, 2007, the Department 

published a notice of opportunity to 

request an administrative review of the 

antidumping duty order on certain pasta 

from Italy. See Antidumping or 

Countervailing Duty Order, Finding, or 

Suspended Investigation: Opportunity 

to Request Administrative Review, 72 

FR 36420 (July 3, 2007). We received 

requests for review from petitioners 1

and from individual Italian exporters/ 

producers of pasta, in accordance with 

19 CFR 351.213(b)(1) and (2). On August 

24, 2007, the Department published the 

notice of initiation of this antidumping 

duty administrative review covering the 

period July 1, 2006, through June 30, 

2007, listing the following companies as 

respondents: Atar S.r.L. (‘‘Atar’’), 

Domenico Paone fu Erasmo S.p.A., F. 

Divella SpA (‘‘Divella’’), Industria 

Alimentare Colavita S.p.A., and Pasta 

Zara SpA 1 (‘‘Zara 1’’) and Pasta Zara 

SpA 2 (‘‘Zara 2’’) (collectively, ‘‘Zara’’), 

Pastificio Carmine Russo, Pastificio Di 

Martino Gaetano & F. lli SrL., Pastificio 

Felicetti SrL, Pastificio Fratelli Pagani 

S.p.A., Pastificio Russo di Cicciano, 

Rummo S.p.A. Molino e Pastificio, and 

Valdigrano Di Flavio Pagani SrL. See 

Initiation of Antidumping and 

Countervailing Duty Administrative 

Reviews and Request for Revocation in 

Part, 72 FR 48613 (August 24, 2007) 

(‘‘Initiation Notice’’). 

On October 15, 2007, due to the 

significant number of requests received 

and then current resource constraints, 

the Department selected the three 

exporters/producers accounting for the 

largest volume of exports—Atar, Divella, 

and Zara, as mandatory respondents.2

The following companies selfrequested that the Department conduct 

an administrative review: Atar, 

Domenico Paone fu Erasmo S.p.A., 

Industria Alimentare Colavita S.p.A., 

Pastificio Carmine Russo, Pastificio 

Fratelli Pagani S.p.A. [sic], Pastificio 

Russo di Cicciano, Rummo S.p.A. 

Molino e Pastificio, and Valdigrano Di 

Flavio Pagani SrL. The companies 

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