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Certain Stilbenic Optical Brightening Agents from China and Taiwan

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Certain Stilbenic Optical Brightening Agents from China and Taiwan Certain Stilbenic Optical Brightening Agents from China and Taiwan Investigation Nos. 731-TA-1186-1187 (Final) Publication 4322 May 2012 U.S. International Trade Commission Washington, DC 20436 U.S. International Trade Commission COMMISSIONERS Deanna Tanner Okun, Chairman Irving A. Williamson, Vice Chairman Daniel R. Pearson Shara L. Aranoff Dean A. Pinkert David S. Johanson Robert B. Koopman Acting Director of Operations Staff assigned Cynthia Trainor, Investigator Philip Stone, Industry Analyst Aimee Larsen, Economist Michele Breaux, Research Assistant Charles Yost, Accountant Steven Hudgens, Senior Statistician Charles St. Charles, Attorney James McClure, 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 Certain Stilbenic Optical Brightening Agents from China and Taiwan Investigation Nos. 731-TA-1186-1187 (Final) Publication 4322 May 2012 CONTENTS Page Determinations ................................................................. 1 Views of the Commission ......................................................... 3 Part I: Introduction ............................................................ I-1 Background .................................................................. I-1 Summary data................................................................ I-1 Statutory criteria and organization of the report...................................... I-2 Statutory criteria ........................................................... I-2 Organization of the report.................................................... I-3 U.S. market summary.......................................................... I-3 Related investigations.......................................................... I-4 The nature and extent of alleged sales at LTFV ...................................... I-4 The subject product ............................................................ I-5 Scope.................................................................... I-5 Tariff treatment ............................................................ I-5 Physical characteristics and uses............................................... I-6 Manufacturing processes ..................................................... I-7 Domestic like product .......................................................... I-8 Interchangeability and customer and producer perceptions .......................... I-10 Channels of distribution...................................................... I-10 Price .................................................................... I-10 Part II: Conditions of competition in the U.S. market ................................ II-1 Market characteristics.......................................................... II-1 Channels of distribution........................................................ II-2 Supply and demand considerations ................................................ II-3 U.S. supply ............................................................... II-3 U.S. demand .............................................................. II-7 Substitutability issues .......................................................... II-10 Factors affecting purchasing decisions .......................................... II-10 Comparisons of domestic product, subject imports, and nonsubject imports ............. II-17 Elasticity estimates............................................................ II-20 U.S. supply elasticity ........................................................ II-20 U.S. demand elasticity....................................................... II-21 Substitution elasticity ....................................................... II-21 Part III: U.S. producers’ production, shipments, and employment ...................... III-1 U.S. producers ............................................................... III-1 U.S. capacity, production, and capacity utilization ................................... III-1 U.S. producers’ shipments ...................................................... III-2 U.S. producers’ inventories ..................................................... III-3 U.S. employment, wages, and productivity ......................................... III-3 Producers’ imports and non-import purchases ....................................... III-4 i CONTENTS Page Part IV: U.S. imports, apparent consumption, and market shares ...................... IV-1 U.S. importers................................................................ IV-1 U.S. imports ................................................................. IV-1 Cumulation considerations...................................................... IV-2 Fungibility and presence in the market .......................................... IV-2 Geographical markets ....................................................... IV-3 Apparent U.S. consumption ..................................................... IV-3 U.S. market shares ............................................................ IV-4 Part V: Pricing and related information ............................................ V-1 Factors affecting prices......................................................... V-1 Raw material costs.......................................................... V-1 U.S. inland transportation costs................................................ V-2 Pricing practices.............................................................. V-2 Pricing methods ............................................................ V-2 Sales terms and discounts .................................................... V-3 Contract vs. spot sales....................................................... V-3 Price data ................................................................... V-4 Price trends ............................................................... V-7 Price comparisons .......................................................... V-8 Lost revenues and lost sales ..................................................... V-9 Part VI: Financial experience of U.S. producers ..................................... VI-1 Background .................................................................. VI-1 Operations on CSOBAs ........................................................ VI-1 Capital expenditures and research and development expenses ........................... VI-4 Assets and return on investment .................................................. VI-4 Capital and investment......................................................... VI-4 Actual negative effects ...................................................... VI-5 Anticipated negative effects .................................................. VI-5 Part VII: Threat considerations and information on nonsubject countries ............... VII-1 The industry in China .......................................................... VII-1 The industry in Taiwan ......................................................... VII-1 The subject industry ........................................................... VII-3 U.S. inventories of product from China and Taiwan .................................. VII-3 U.S. importers’ imports subsequent to December 31, 2011 ............................. VII-3 Antidumping and countervailing duty investigations in third-country markets .............. VII-3 Information on nonsubject countries .............................................. VII-3 ii CONTENTS Page Appendixes A. Federal Register notices....................................................... A-1 B. Calendar of the public hearing.................................................. B-1 C. Summary data for CSOBAs (total, 100-percent active ingredient basis) .................. C-1 D. Data for CSOBAs in solution form .............................................. D-1 E. Data for CSOBAs in powder form............................................... E-1 F. Price date based on purchasers’ active ingredient levels of CSOBA products imported from China ......................................................... F-1 G. Price comparisons among the U.S.-produced and subject imported CSOBA products and those imported from nonsubject countries .............................................. G-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. iii UNITED STATES INTERNATIONAL TRADE COMMISSION Investigation Nos. 731-TA-1186-1187 (Final) CERTAIN STILBENIC OPTICAL BRIGHTENING AGENTS FROM CHINA AND TAIWAN DETERMINATIONS On the basis of the record1 developed in the subject investigations, 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 and Taiwan of certain stilbenic optical brightening agents, provided for in subheadings 3204.20.80 and 2921.59.40 and may have been imported under subheadings 2921.59.80 and 2933.69.60 (statistical reporting numbers 2921.59.8090 and 2933.69.6050) 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). BACKGROUND The Commission instituted these investigations effective March 31, 2011,
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