Frozen Concentrated Orange Juice from Brazil
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Frozen Concentrated Orange Juice From Brazil Investigation No. 731-TA-326 (Second Review) Publication 3760 March 2005 U.S. International Trade Commission COMMISSIONERS Stephen Koplan, Chairman Deanna Tanner Okun, Vice Chairman Marcia E. Miller Jennifer A. Hillman Charlotte R. Lane Daniel R. Pearson Robert A. Rogowsky Director of Operations Staff assigned: Megan Spellacy, Investigator Kelly Clark, Economist Alfred Dennis, Industry Analyst John Ascienzo, Accountant Michael Diehl, Attorney Steve Hudgens, Statistician Diane Mazur, 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 Frozen Concentrated Orange Juice From Brazil Investigation No.731-TA-326 (Second Review) Publication 3760 March 2005 CONTENTS Page Determination................................................................... 1 Views of the Commission ......................................................... 3 Part I: Introduction and overview ................................................... I-1 Background .................................................................. I-1 Statutory criteria and organization of the report...................................... I-1 Summary of data.............................................................. I-4 The original investigation and first five-year review.................................. I-4 Commerce’s final results of expedited review....................................... I-8 Commerce’s administrative reviews............................................... I-8 Distribution of continued dumping and subsidy offset funds to affected domestic producers . I-10 The subject product ............................................................ I-11 Domestic like product issues .................................................... I-14 U.S. market participants........................................................ I-14 U.S. producers............................................................. I-14 U.S. importers............................................................. I-15 Total available FCOJM and market shares.......................................... I-15 Part II: Conditions of competition in the U.S. market ................................... II-1 U.S. market segments.......................................................... II-1 U.S. channels of distribution..................................................... II-1 Supply and demand considerations ................................................ II-1 U.S. supply ............................................................... II-1 U.S. demand .............................................................. II-4 Substitutability issues .......................................................... II-5 Factors affecting purchasing decisions .......................................... II-5 Comparisons of domestic products, subject imports, and nonsubject imports ............ II-9 Elasticity estimates............................................................ II-11 U.S. supply elasticity ........................................................ II-11 U.S. demand elasticity....................................................... II-11 Substitution elasticity ....................................................... II-11 Part III: Condition of the U.S. industry ............................................... III-1 U.S. growers................................................................. III-1 U.S. bearing acreage, production, inventories, and shipments ........................ III-1 U.S. extractor/processors ....................................................... III-6 U.S. extractor/processors’ capacity, production, and capacity utilization ................ III-6 U.S. extractor/processors’ domestic shipments, company transfers, and export shipments . III-8 U.S. extractor/processors’ inventories ........................................... III-10 U.S. extractor/processors’ employment, wages, and productivity ..................... III-11 Financial condition of the U.S. industry ............................................ III-12 Background ............................................................... III-12 Operations of U.S. FCOJM processors .......................................... III-12 Capital expenditures and research and development expenses ........................ III-17 Assets and return on investment ............................................... III-17 i CONTENTS Page Part IV: U.S. imports and the foreign industry ......................................... IV-1 U.S. imports ................................................................. IV-1 U.S. importers’ inventories...................................................... IV-3 The industry in Brazil .......................................................... IV-4 Part V: Pricing and related information .............................................. V-1 Factors affecting prices......................................................... V-1 Raw materials ............................................................. V-1 Transportation costs to the U.S. market.......................................... V-1 U.S. inland transportation costs................................................ V-1 Exchange rates............................................................. V-1 Pricing practices.............................................................. V-3 Pricing methods ............................................................ V-3 Price data ................................................................... V-4 Price trends ............................................................... V-5 Appendixes A. Federal Register notices and the Commission’s statement on adequacy .................. A-1 B. Hearing witnesses ............................................................ B-1 C. Summary data............................................................... C-1 D. U.S. producers’, U.S. importers’, U.S. purchasers’, and foreign producers’ comments regarding the effects of the antidumping duty order and the likely effects of revocation ............. D-1 E. U.S. producers’ comments regarding their support or opposition to the current antidumping duty order ...................................................................... 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 Investigation No. 731-TA-326 (Second Review) FROZEN CONCENTRATED ORANGE JUICE FROM BRAZIL DETERMINATION On the basis of the record1 developed in the subject five-year review, the United States International Trade Commission (Commission) determines, pursuant to section 751(c) of the Tariff Act of 1930 (19 U.S.C. § 1675(c)) (the Act), that revocation of the antidumping duty order on frozen concentrated orange juice from Brazil would not be likely to lead to continuation or recurrence of material injury to an industry in the United States within a reasonably foreseeable time. BACKGROUND The Commission instituted this review on April 1, 2004 (69 F.R. 17230) and determined on July 6, 2004 that it would conduct a full review (69 F.R. 44060, July 23, 2004). Notice of the scheduling of the Commission’s review 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 on August 20, 2004 (69 F.R. 51711). The hearing was held in Washington, DC, on February 1, 2005, and all persons who requested the opportunity were permitted to appear in person or by counsel. 1 The record is defined in sec. 207.2(f) of the Commission’s Rules of Practice and Procedure (19 CFR § 207.2(f)). VIEWS OF THE COMMISSION Based on the record in this five-year review, we determine under section 751(c) of the Tariff Act of 1930, as amended (the Act), that revocation of the antidumping duty order on frozen concentrated orange juice (FCOJM)1 from Brazil would not be likely to lead to continuation or recurrence of material injury to an industry in the United States within a reasonably foreseeable time. I. BACKGROUND In April 1987, the Commission determined that an industry in the United States was materially injured or threatened with material injury by reason of imports of FCOJM from Brazil that were being sold at less than fair value.2 On May 5, 1987, Commerce issued an antidumping duty order on imports of FCOJM from Brazil.3 In May 1999, the Commission completed its first five-year review of the order. Based on the record before it, the Commission determined that revocation of the order would be likely to lead to the continuation or recurrence of material injury.4 The Commission instituted the instant review on April 1, 2004.5 In five-year reviews, the Commission initially determines whether to conduct a full review (which includes a public hearing, the issuance of questionnaires, and other procedures) or an expedited review. In order to make this decision, the Commission first determines whether individual responses to the notice of institution are adequate. Next, based on those responses deemed individually adequate, the Commission determines whether the collective responses submitted by two groups of interested parties – domestic interested parties