Commerce Again Drops PMS Adjustment From Sales-Below-Cost Test in AD Review

The Commerce Department again dropped its particular market situation adjustment to the sales-below-cost test in an antidumping review, despite continuing to find that a PMS existed during the review. Dropping the adjustment in Oct. 29 remand results at the Court of International Trade, Commerce said it fulfilled the terms of its voluntary remand request in the case, explaining that the court ruled in other cases that the agency is not allowed to make such an adjustment when finding normal value (NEXTEEL Co., Ltd. v. United States, CIT #20-03868).

The case stems from the 2017-18 administrative review of the antidumping duty order on circular welded non-alloy steel pipe from South Korea. In the review, Commerce found that a particular market situation existed for hot-rolled steel coil, a key input of CWP, based on four factors alleged by the antidumping duty petitioner. The four factors consisted of "(1) Korean subsidies of hot-rolled steel coil; (2) Korean imports of hot-rolled steel coil from the People’s Republic of China; (3) strategic alliances between Korean hot-rolled steel coil producers and CWP producers; and (4) distortions in the Korean electricity market."

Commerce then made an adjustment for this PMS to the mandatory respondents' cost of production when conducting a sales-below-cost test for calculating normal value -- the mandatory respondents were Husteel Co. and Hyundai Steel Co. But, the law does not permit this, the court said in its ruling, striking down the PMS adjustment (see 2109270042).

If sustained, dropping the adjustment would lead to lowered dumping margins for the respondents in the remand results. Husteel's rate dropped from 10.91% to 6.44%, Hyundai's rate dropped from 8.14% to 4.82%, and the non-examined companies' rate, including lead plaintiff NEXTEEL Co., dropped from 9.53% to 5.63%.