[Federal Register Volume 66, Number 245 (Thursday, December 20, 2001)]
[Notices]
[Pages 65740-65742]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-31385]


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INTERNATIONAL TRADE COMMISSION


Gray Portland Cement and Cement Clinker From Mexico; Dismissal of 
Request for Institution of a Section 751(b) Review Investigation

AGENCY: United States International Trade Commission.

ACTION: Dismissal of a request to institute a section 751(b) 
investigation concerning the Commission's affirmative determination in 
investigation No. 731-TA-451 (Final): Gray Portland Cement and Cement 
Clinker from Mexico.

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SUMMARY: The Commission determines,\1\ pursuant to section 751(b) of 
the Tariff Act of 1930 (the Act) \2\ and Commission rule 207.45,\3\ 
that the subject request does not show changed circumstances sufficient 
to warrant institution of an investigation to review the Commission's 
affirmative determination in investigation No. 731-TA-451 (Final): Gray 
Portland Cement and Cement Clinker from Mexico. Gray portland cement is 
classifiable under subheading 2523.29.00 of the Harmonized Tariff 
Schedule of the United States (HTS) and cement clinker is classifiable 
under HTS subheading 2523.10.00.\4\ Pursuant to Commission rule 
201.4(b), the Commission determined that there was good cause to extend 
the deadline for this determination as set forth in Commission rule 
207.45(c).
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    \1\ Commissioner Bragg did not participate in the deliberations 
in this request.
    \2\ 19 U.S.C. 1675(b).
    \3\ 19 CFR 207.45.
    \4\ Gray portland cement has also been entered under HTS 
subheading 2523.90.00 as ``other hydraulic cements.''

FOR FURTHER INFORMATION CONTACT: Debra Baker (202-205-3180) or Robert 
Carpenter (202-205-3172), Office of Investigations, U.S. International 
Trade Commission, 500 E Street SW, Washington, DC 20436. Hearing-
impaired persons can obtain information on this matter by contacting 
the Commission's TDD terminal on 202-205-1810. Persons with mobility 
impairments who will need special assistance in gaining access to the 
Commission should contact the Office of the Secretary at 202-205-2000. 
General information concerning the Commission may also be obtained by 
accessing its internet server (http://www.usitc.gov). The public record 
for this matter may be viewed on the Commission's electronic docket 
(EDIS-ON-LINE) at http://dockets.usitc.gov/eol/public.

[[Page 65741]]

Background Information

    On September 19, 2001, the Commission received a request to review 
its affirmative determination concerning gray portland cement and 
cement clinker from Mexico (the request), in light of changed 
circumstances pursuant to section 751(b) of the Act.\5\ The request was 
filed by counsel on behalf of CEMEX, S.A. de C.V. (CEMEX), a 
manufacturer of cement in Mexico. Gray portland cement is a hydraulic 
cement and the primary component of concrete. Clinker, an intermediate 
material produced when manufacturing cement, has no use other than that 
of being ground into finished cement.
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    \5\ 19 U.S.C. 1675(b).
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    Pursuant to section 207.45(b) of the Commission's Rules of Practice 
and Procedure,\6\ the Commission published a notice in the Federal 
Register on October 10, 2001,\7\ requesting comments as to whether the 
alleged changed circumstances warranted the institution of a review 
investigation. The Commission received comments in support of the 
request from (1) counsel on behalf of Cementos Apasco, S.A. de C.V. and 
(2) counsel on behalf of GCC Cemento, S.A. de C.V. and its U.S. 
affiliate, Rio Grande Portland Cement Corp., which both imported cement 
from Mexico during the original investigation and produce cement in 
Mexico. Additional comments in support of a changed circumstances 
review were also received from a number of community officials and 
cement customers, including: (1) Kenneth A. Mayfield, Dallas County 
Commissioner, Dallas, TX; (2) Elizabeth G. Flores, Mayor, City of 
Laredo, TX; (3) Robert J. Schlegel, Pavestone Co.; (4) The Honorable 
Robert Eckles, County Judge, Harris County, TX; (5) Robert Cutter, 
CEMEX USA; (6) Richard D. Steinke, Port of Long Beach, CA; (7) Cameron 
Klein, Oldcastle APG West; (8) David A. Schwab, Schwab Ready Mix, Inc.; 
and (9) Gerald M. Howard, National Association of Home Builders. In 
addition, Senator John McCain forwarded a letter to the Commission from 
Robert Cutter, CEMEX, who supports the initiation of a changed 
circumstances review. Letters in support of the initiation of a changed 
circumstances review were also received from a number of members of 
Congress. Comments received in opposition to the request were filed by 
counsel on behalf of the Committee for Fairly Traded Mexican Cement 
(Committee); the International Brotherhood of Boilermakers, Iron Ship 
Builders, Blacksmiths, Forgers & Helpers; the Paper, Allied-Industrial, 
Chemical & Energy Workers International Union; and the International 
Union of Operating Engineers (collectively, the domestic industry). The 
22 members of the Committee have 28 cement plants located in the 
Southern Tier region; the 3 labor unions identified above represent 
workers at 17 plants operated by 13 companies in the Southern Tier.
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    \6\ 19 CFR 207.45(b).
    \7\ 66 FR 51685.
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Analysis

    In considering whether to institute a review investigation under 
section 751(b), the Commission will not institute such an investigation 
unless it is persuaded there is sufficient information demonstrating:
    (1) That there have been significant changed circumstances from 
those in existence at the time of the original investigation;
    (2) That those changed circumstances are not the natural and direct 
result of the imposition of the antidumping and/or countervailing duty 
order, and
    (3) That the changed circumstances, allegedly indicating that 
revocation of the order would not be likely to lead to continuation or 
recurrence of material injury to the domestic industry, warrant full 
investigation.\8\
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    \8\ See Heavy Forged Handtools from the People's Republic of 
China, 62 FR 36305 (July 7, 1997); Certain Cold-Rolled Carbon Steel 
Plate Products from Germany and the Netherlands, 61 FR 17319 (April 
19, 1996); see generally, A. Hirsh, Inc. v. United States, 737 F. 
Supp. 1186 (CIT 1990); Avesta AB v. United States, 724 F. Supp. 974 
(CIT 1989), aff'd 914 F.2d 233 (Fed. Cir. 1990); and Avesta AB v. 
United States, 689 F. Supp. 1173 (CIT 1988).
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    After consideration of the request for review and the response to 
the notice inviting comments, the Commission has determined, pursuant 
to section 751(b) of the Act and Commission rule 207.45, that the 
information available to the Commission does not show changed 
circumstances sufficient to warrant institution of an investigation to 
review the Commission's affirmative determination in investigation No. 
731-TA-451 (Final): Gray Portland Cement and Cement Clinker from 
Mexico.
    The alleged changed circumstance consists of CEMEX's acquisition of 
U.S. cement producer, Southdown, Inc. CEMEX alleges that the 
acquisition, which was finalized on November 16, 2000, ``eliminates any 
perceived incentive for CEMEX to import cement from Mexico into the 
Southern Tier in quantities or at prices that would cause material 
injury to all or almost all Southern Tier cement producers in the 
reasonably foreseeable future.''
    The information available, including the request and the comments 
received in response to the notice, does not persuade us that an 
investigation is warranted. In particular:
    The decision to undertake a review is ``a threshold question, * * 
*. [which] may be made only when it reasonably appears that positive 
evidence adduced by the petitioner together with other evidence 
gathered by the Commission leads the ITC to believe that there are 
changed circumstances sufficient to warrant review.'' \9\ CEMEX's 
allegation that the acquisition is a sufficient change focuses on the 
amount invested in the acquisition and the argument that ``their 
economic self-interest precludes them from harming the Southern Tier 
industry and markets.'' CEMEX, however, has not provided evidence that 
the acquisition has changed the effect of the subject imports on the 
Southern Tier regional industry.\10\ The increase in regional market 
share resulting from CEMEX's acquisition alone does not demonstrate a 
change without evidence of an actual change in imports or ability to 
supply imports, prices, or competitive conditions in the industry.\11\ 
CEMEX has not presented adequate and specific facts, such as the volume 
and value of imports from Mexico since the acquisition, that would 
provide support for its claims and allegations that the acquisition 
prevents it from engaging ``in import practices that undermine the 
pricing structure of its Southern Tier (and U.S.) markets.''
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    \9\ Avesta, 689 F. Supp. at 1181 (CIT 1988); A Hirsh, Inc. v. 
United States, 729 F. Supp. 1360, 1363 (CIT 1990), aff'd following 
remand, 737 F. Supp. at 1188 (CIT 1990).
    \10\ CEMEX made similar arguments in the five-year review 
completed in October 2000 regarding its single domestic operation 
and the Commission rejected it on the basis that it was not 
supported by the evidence. USITC Pub. 3361 at 39, n.234, and 41.
    \11\ See Avesta, 689 F. Supp. at 1181-1183; Avesta, 724 F. Supp. 
at 978-980.
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    CEMEX has not met its burden of persuading the Commission that the 
acquisition has affected the quantity of Mexican imports. Moreover, the 
information available to the Commission is clearly inconsistent with 
CEMEX's claims. U.S. imports of cement from Mexico have not fallen or 
even remained steady, but have instead increased since CEMEX's 
acquisition of Southdown in November 2000. The volume of imports of 
Mexican cement was 29.2 percent higher for the January-September 2001 
period compared with the same period in 2000. Moreover, the unit values 
of imports of cement from Mexico have declined since the acquisition. 
Neither the increases in volume nor declines in value of imports

[[Page 65742]]

of Mexican cement provide evidence of a change in importing strategy by 
CEMEX resulting from the acquisition that would warrant a full review 
to consider the issue of revocation. In not presenting adequate facts 
to demonstrate a sufficient change in circumstances, CEMEX has not met 
its burden at the initial stage.\12\
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    \12\ See Hirsh, 737 F. Supp. at 1188.
    \13\ Hirsh, 737 F. Supp. at 1188 (``improved health of the 
domestic industry and avoidance of an injured condition is the 
hoped-for outcome of an unfair trade order * * * [and] is of little 
consequence as an isolated fact in terms of whether review is 
warranted.'').
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    Finally, CEMEX raises a number of arguments that address the merits 
of whether the order should be revoked and are ``of little consequence 
as an isolated fact in terms of whether the review is warranted.''\13\
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    \14\ Hirsh, 729 F. Supp. at 1363 (CIT 1990), citing, Avesta, 689 
F. Supp. at 1181 (CIT 1988).
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    In order to obtain a review, a requester ``must present facts which 
when weighed against the other facts presented, would convince a 
reasonable decision-maker that a full investigation is necessary to 
establish whether or not changed circumstances have obviated the need 
for the order in its present form.''\14\ CEMEX has made various 
allegations but provided virtually no evidence, and certainly not 
adequate facts, to support its claim that the acquisition of Southdown 
is a changed circumstance sufficient to warrant review of the order. 
Moreover, the available Commerce import data provide clear and 
convincing contrary evidence that imports of cement from Mexico have 
increased, and their value has declined, since the acquisition. 
Finally, CEMEX has not made it clear why the Commission should not find 
that a shift of production to the U.S. market would be anything other 
than the natural consequence of the outstanding antidumping duty order.
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    \14\ Hirsh, 729 F. Supp. at 1363 (CIT 1990), citing, Avesta, 689 
F. Supp. at 1181 (CIT 1988).
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    In light of the above analysis, the Commission determines that 
institution of a review investigation under section 751(b) of the Act 
concerning the Commission's affirmative determination in investigation 
No. 731-TA-451 (Final): Gray Portland Cement and Cement Clinker from 
Mexico, is not warranted.

    Issued: December 17, 2001.

    By order of the Commission.
Donna R. Koehnke,
Secretary.
[FR Doc. 01-31385 Filed 12-19-01; 8:45 am]
BILLING CODE 7020-02-P