Xanthan Gum Exporter Wants to Preserve Right to Challenge Separate Entity Rate

The Commerce Department double counted energy costs for Chinese xanthan gum producer Fufeng in an antidumping duty review on xanthan gum from China, and "compounded" the error by applying the incorrect rate to separate rate applicant, Meihua, the company said in an April 14 complaint at the Court of International Trade (Meihua Group International Trading (Hong Kong) v. U.S., CIT # 23-00069).

In the review, mandatory respondent Fufeng was hit with a 17.36% AD rate despite being granted a 0% rate in the preliminary results. Meihua applied for voluntary respondent status, but Commerce granted a separate rate based on Fufeng's rate instead.

Meihua alleged that Commerce incorrectly "double counted" energy and related costs by including those costs in both the financial ratios and in the factors of production. "The Department erred when it calculated the rate for mandatory respondent Fufeng. It compounded this error by applying this erroneously calculated rate to Meihua," the company said. That double counting resulted in an inflated margin for Fufeng and, as a result, an identical inflated margin for Meihua, the company argued.

Fufeng also filed suit at CIT (see 2304170061) but Meihua said it wants to preserve its right to contest the shared rate if Fufeng fails in its court challenge, arguing that the rate assigned to a separate rate entity should reflect a properly calculated final rate for the mandatory respondent. "In the event that Fufeng fails to challenge the rate in Court, Meihua has a right to independently challenge the rate," it said.