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Sodium Hexametaphosphate from China

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Sodium Hexametaphosphate from China Sodium Hexametaphosphate From China Investigation No. 731-TA-1110 (Final) Publication 3984 March 2008 Washington, DC 20436 U.S. International Trade Commission COMMISSIONERS Daniel R. Pearson, Chairman Shara L. Aranoff, Vice Chairman Deanna Tanner Okun Charlotte R. Lane Irving A. Williamson Dean A. Pinkert Robert A. Rogowsky Director of Operations Staff assigned Debra Baker, Investigator Philip Stone, Industry Analyst Craig Thomsen, Economist John Ascienzo, Auditor Robin Turner, Attorney Mara Alexander, Statistician George Deyman, Supervisory Investigator Address all communications to Secretary to the Commission United States International Trade Commission Washington, DC 20436 U.S. International Trade Commission Washington, DC 20436 www.usitc.gov Sodium Hexametaphosphate From China Investigation No. 731-TA-1110 (Final) Publication 3984 March 2008 CONTENTS Page Determination................................................................... 1 Views of the Commission ......................................................... 3 Part I: Introduction .............................................................. I-1 Background .................................................................. I-1 Organization of the report....................................................... I-1 Summary data................................................................ I-2 Previous and related investigations................................................ I-3 Nature and extent of sales at LTFV ............................................... I-3 The subject product ............................................................ I-4 Definition of the subject product ............................................... I-4 U.S. tariff treatment......................................................... I-5 The domestic like product ....................................................... I-6 Description and uses ........................................................ I-7 Production process .......................................................... I-11 Data on product types .......................................................... I-12 Part II: Conditions of competition in the U.S. market ................................... II-1 Channels of distribution........................................................ II-1 Lead times................................................................ II-1 Internet sales .............................................................. II-1 Market segments.............................................................. II-1 Supply and demand considerations ................................................ II-3 U.S. supply ............................................................... II-3 U.S. demand .............................................................. II-4 Cost share ................................................................ II-5 Qualification/certification.................................................... II-5 Substitute products ......................................................... II-6 Substitutability issues .......................................................... II-7 Factors affecting purchasing decisions .......................................... II-7 Comparisons of domestic products, subject imports, and nonsubject imports ............ II-9 Elasticity estimates............................................................ II-13 U.S. supply elasticity ........................................................ II-13 U.S. demand elasticity....................................................... II-13 Substitution elasticity ....................................................... II-14 Part III: U.S. producers’ production, shipments, and employment .......................... III-1 U.S. producers ............................................................... III-1 U.S. producers’ imports and purchases ............................................. III-3 U.S. producers’ capacity, production, and capacity utilization .......................... III-3 U.S. producers’ shipments ...................................................... III-4 U.S. producers’ inventories ..................................................... III-5 U.S. producers’ employment, wages, and productivity ................................ III-5 Continued. i CONTENTS–Continued Page Part IV: U.S. imports, apparent consumption, and market shares........................... IV-1 U.S. importers................................................................ IV-1 U.S. imports ................................................................. IV-1 Calculation of U.S. imports................................................... IV-1 U.S. import trends.......................................................... IV-6 The question of negligible imports ............................................. IV-7 Apparent U.S. consumption and U.S. market shares .................................. IV-7 Part V: Pricing and related information .............................................. V-1 Factors affecting prices......................................................... V-1 Raw material costs.......................................................... V-1 Tariffs and transportation costs................................................ V-1 Exchange rates............................................................. V-1 Pricing practices.............................................................. V-2 Pricing methods ............................................................ V-2 Sales terms and discounts .................................................... V-3 Price leadership............................................................ V-3 Price data ................................................................... V-4 Price trends ............................................................... V-4 Price comparisons .......................................................... V-7 Lost sales and lost revenues ..................................................... V-7 Part VI: Financial experience of U.S. producers........................................ VI-1 Background .................................................................. VI-1 Operations on SHMP .......................................................... VI-1 Capital expenditures and research and development expenses ........................... VI-4 Assets and return on investment .................................................. VI-4 Capital and investment......................................................... VI-4 Part VII: Threat considerations and Bratsk information.................................. VII-1 Overview of data collection ..................................................... VII-1 Summary of data provided...................................................... VII-1 The industry in China .......................................................... VII-2 Importers’ U.S. inventories...................................................... VII-5 Information on nonsubject sources ................................................ VII-6 Bratsk considerations........................................................ VII-6 Nonsubject manufacturers.................................................... VII-7 Appendices A. Federal Register notices ...................................................... A-1 B. Hearing witnesses ........................................................... B-1 C. Summary data .............................................................. C-1 D. Information on prices of SHMP from nonsubject countries ........................... D-1 E. Questionnaire data on the nonsubject SHMP industries in France and Germany ........... E-1 Note.--Information that would reveal confidential operations of individual concerns may not be published and therefore has been deleted from this report. Such deletions are indicated by asterisks. ii UNITED STATES INTERNATIONAL TRADE COMMISSION Washington, DC 20436 Investigation No. 731-TA-1110 (Final) SODIUM HEXAMETAPHOSPHATE FROM CHINA DETERMINATION On the basis of the record1 developed in the subject investigation, the United States International Trade Commission (Commission) determines, pursuant to section 735(b) of the Tariff Act of 1930 (19 U.S.C. § 1673d(b)) (the Act), that an industry in the United States is materially injured by reason of imports from China of sodium hexametaphosphate, provided for in subheadings 2835.39.50 and 3824.90.39 of the Harmonized Tariff Schedule of the United States, that have been found by the Department of Commerce (Commerce) to be sold in the United States at less than fair value (LTFV).2 BACKGROUND The Commission instituted this investigation effective February 8, 2007, following receipt of a petition filed with the Commission and Commerce by ICL Performance Products, LP, St. Louis, MO, and Innophos, Inc., Cranbury, NJ. The final phase of the investigation was scheduled by the Commission following notification of a preliminary determination by Commerce that imports of sodium hexametaphosphate from China were being sold at LTFV within the meaning of section 733(b) of the Act (19 U.S.C. § 1673b(b)). Notice of the scheduling of the final phase of the Commission’s investigation and of a public hearing to be held in connection therewith was given by posting copies of the notice in the Office of the Secretary, U.S. International Trade Commission, Washington, DC, and by publishing the notice in the Federal Register of October 31, 2007 (72 FR 61677). The hearing was held in Washington, DC, on January 24, 2008, and all persons who
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