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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 (Preliminary) Publication 3912 April 2007 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, Accountant/Auditor Robin Turner, Attorney George L. 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 (Preliminary) Publication 3912 April 2007 CONTENTS Page Determination................................................................... 1 Views of the Commission ......................................................... 3 Separate and additional views of Chairman Daniel R. Pearson and Commissioner Deanna Tanner Okun concerning Bratsk Aluminum v. United States .................................. 19 Part I: Introduction .............................................................. I-1 Background .................................................................. I-1 Organization of the report....................................................... I-1 Summary data................................................................ I-2 Previous and related investigations................................................ I-2 Nature and extent of alleged sales at LTFV ......................................... I-3 The subject product ............................................................ I-3 U.S. tariff treatment......................................................... I-4 The domestic like product ....................................................... I-4 Description and uses ........................................................ I-5 Production process .......................................................... I-8 Data on product types .......................................................... I-9 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-2 U.S. supply ............................................................... II-2 U.S. demand .............................................................. II-2 Cost share ................................................................ II-3 Qualification/certification.................................................... II-3 Substitute products ......................................................... II-4 Substitutability issues .......................................................... II-4 Interchangeability .......................................................... II-4 Non-price differences ....................................................... II-5 Elasticity estimates............................................................ II-5 U.S. supply elasticity ........................................................ II-5 U.S. demand elasticity....................................................... II-6 Substitution elasticity ....................................................... II-6 Part III: U.S. producers’ production, shipments, and employment .......................... III-1 U.S. producers ............................................................... III-1 U.S. producers’ imports and purchases ............................................. III-2 U.S. producers’ capacity, production, and capacity utilization .......................... III-2 U.S. producers’ shipments ...................................................... III-3 U.S. producers’ inventories ..................................................... III-4 U.S. producers’ employment, wages, and productivity ................................ III-4 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-5 The question of negligible imports ............................................. IV-6 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 data ................................................................... V-3 Price trends ............................................................... V-3 Price comparisons .......................................................... V-6 Lost sales and lost revenues ..................................................... V-6 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-3 Assets and return on investment .................................................. VI-3 Capital and investment......................................................... VI-3 Part VII: Threat considerations..................................................... VII-1 The industry in China .......................................................... VII-1 Nonsubject manufacturers ...................................................... VII-2 Importers’ U.S. inventories...................................................... VII-2 Anticipated shipments of SHMP from China........................................ VII-3 Appendices A. Federal Register notices ...................................................... A-1 B. Conference witnesses ......................................................... B-1 C. Summary data .............................................................. C-1 D. Information on prices of SHMP from nonsubject countries ........................... D-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 Investigation No. 731-TA-1110 (Preliminary) SODIUM HEXAMETAPHOSPHATE (SHMP) 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 733(a) of the Tariff Act of 1930 (19 U.S.C. § 1673b(a)) (the Act), that there is a reasonable indication 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 3823.90.39 of the Harmonized Tariff Schedule of the United States, that are alleged to be sold in the United States at less than fair value (LTFV). COMMENCEMENT OF FINAL PHASE INVESTIGATION Pursuant to section 207.18 of the Commission’s rules, the Commission also gives notice of the commencement of the final phase of its investigation. The Commission will issue a final phase notice of scheduling, which will be published in the Federal Register as provided in section 207.21 of the Commission’s rules, upon notice from the Department of Commerce (Commerce) of an affirmative preliminary determination in the investigation under section 733(b) of the Act, or, if the preliminary determination is negative, upon notice of an affirmative final determination in that investigation under section 735(a) of the Act. Parties that filed entries of appearance in the preliminary phase of the investigation need not enter a separate appearance for the final phase of the investigation. Industrial users, and, if the merchandise under investigation is sold at the retail level, representative consumer organizations have the right to appear as parties in Commission antidumping and countervailing duty investigations. The Secretary will prepare a public service list containing the names and addresses of all persons, or their representatives, who are parties to the investigation. BACKGROUND On February 8, 2007, a petition was filed with the Commission and Commerce by ICL Performance Products, LP, St.
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