Dioctyl Terephthalate (DOTP) from Korea Investigation No. 731-TA-1330 (Preliminary) Publication 4630 August 2016 U.S. International Trade Commission Washington, DC 20436 U.S. International Trade Commission COMMISSIONERS Irving A. Williamson, Chairman David S. Johanson, Vice Chairman Dean A. Pinkert Meredith M. Broadbent F. Scott Kieff Rhonda K. Schmidtlein Catherine DeFilippo Director of Operations Staff assigned Keysha Martinez, Investigator Brian Allen, Industry Analyst Jeffrey Clark, Economist Charles Yost, Accountant Mara Alexander, Statistician Carolyn Holmes, Statistical Assistant Jane Dempsey, Attorney Elizabeth Haines, Supervisory Investigator Special assistance from Porscha Stiger, Investigator Andrew Knipe, Economist 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 Dioctyl Terephthalate (DOTP) from Korea Investigation No. 731-TA-1330 (Preliminary) Publication 4630 August 2016 CONTENTS Page Determination ................................................................................................................................. 1 Views of the Commission ............................................................................................................... 3 Dissenting Views of Commissioner F. Scott Kieff ........................................................................ 27 Part I: Introduction ................................................................................................................ I‐1 Background ................................................................................................................................ I‐1 Statutory criteria and organization of the report ..................................................................... I‐2 Statutory criteria ................................................................................................................... I‐2 Organization of the report .................................................................................................... I‐3 Market summary ....................................................................................................................... I‐3 Summary data and data sources ............................................................................................... I‐4 Previous and related investigations .......................................................................................... I‐4 Nature and extent of alleged sales at LTFV ............................................................................... I‐4 The subject merchandise .......................................................................................................... I‐5 Commerce’s scope ................................................................................................................ I‐5 Tariff treatment ..................................................................................................................... I‐6 The product ............................................................................................................................... I‐6 Description and applications ................................................................................................. I‐6 Manufacturing processes ...................................................................................................... I‐8 Domestic like product issues ................................................................................................... I‐10 Physical characteristics and uses ......................................................................................... I‐10 Manufacturing facilities and production employees .......................................................... I‐11 Interchangeability ................................................................................................................ I‐11 Customer and producer perceptions .................................................................................. I‐12 Channels of distribution ...................................................................................................... I‐12 Price ..................................................................................................................................... I‐13 i CONTENTS Page Part II: Conditions of competition in the U.S. market ............................................................ II‐1 U.S. market characteristics ....................................................................................................... II‐1 Channels of distribution ........................................................................................................... II‐1 Geographic distribution ........................................................................................................... II‐1 Supply and demand considerations ......................................................................................... II‐2 U.S. supply ............................................................................................................................ II‐2 U.S. demand ......................................................................................................................... II‐5 Substitutability issues ............................................................................................................... II‐7 Lead times ............................................................................................................................ II‐7 Factors affecting purchasing decisions................................................................................. II‐7 Comparison of U.S.‐produced and imported DOTP ............................................................. II‐8 Part III: U.S. producer’s production, shipments, and employment ....................................... III‐1 U.S. producer ........................................................................................................................... III‐1 U.S. production, capacity, and capacity utilization ................................................................. III‐2 U.S. producer’s U.S. shipments and exports ........................................................................... III‐3 U.S. producer’s inventories ..................................................................................................... III‐3 U.S. producer’s imports and purchases .................................................................................. III‐3 U.S. employment, wages, and productivity ............................................................................ III‐3 Part IV: U.S. imports, apparent U.S. consumption, and market shares ................................ IV‐1 U.S. importers.......................................................................................................................... IV‐1 U.S. imports ............................................................................................................................. IV‐2 Negligibility .............................................................................................................................. IV‐2 Apparent U.S. consumption and market shares ..................................................................... IV‐3 ii CONTENTS Page Part V: Pricing data ............................................................................................................... V‐1 Factors affecting prices ............................................................................................................ V‐1 Raw material costs ............................................................................................................... V‐1 U.S. inland transportation costs ........................................................................................... V‐1 Pricing practices ....................................................................................................................... V‐2 Pricing methods .................................................................................................................... V‐2 Sales terms and discounts .................................................................................................... V‐2 Price data .................................................................................................................................. V‐3 Price trends ........................................................................................................................... V‐4 Price comparisons ................................................................................................................ V‐4 Lost sales and lost revenue ...................................................................................................... V‐4 Part VI: Financial experience of the U.S. producer ............................................................... VI‐1 Background .............................................................................................................................. VI‐1 Operations on DOTP ................................................................................................................ VI‐2 Net sales .............................................................................................................................. VI‐2 Costs and expenses ............................................................................................................