70 FR 12186, March 11, 2005
DEPARTMENT OF COMMERCE
International Trade Administration
[C-122-851]
Final Negative Countervailing Duty Determination: Live Swine from Canada
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
SUMMARY: The Department of Commerce has made a final determination that
countervailable subsidies are not being provided to producers or
exporters of live swine from Canada.
EFFECTIVE DATE: March 11, 2005.
FOR FURTHER INFORMATION CONTACT: Melani Miller Harig, Stephen Cho,
Daniel J. Alexy, and Marc Rivitz, AD/CVD Operations, Office 1, Import
Administration, U.S. Department of Commerce, Room 3099, 14th Street and
Constitution Avenue, NW, Washington, DC 20230; telephone (202) 482-
0116, (202) 482-3798, (202) 482-1540, and (202) 482-1382, respectively.
SUPPLEMENTARY INFORMATION:
Petitioners
The petitioners in this investigation are the Illinois Pork
Producers Association, the Indiana Pork Advocacy Coalition, the Iowa
Pork Producers Association, the Minnesota Pork Producers Association,
the Missouri Pork Association, the Nebraska Pork Producers Association,
Inc., the North Carolina Pork Council, Inc., the Ohio Pork Producers
Council, and 119 individual producers of live swine\1\ (collectively,
``the petitioners'').
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\1\ Alan Christensen, Alicia Prill-Adams, Aulis Farms, Baarsch
Pork Farm, Inc., Bailey Terra Nova Farms, Bartling Brothers Inc.,
Belstra Milling Co. Inc., Berend Bros. Hog Farm LLC, Bill Tempel, BK
Pork Inc., Blue Wing Farm, Bornhorst Bros, Brandt Bros., Bredehoeft
Farms, Inc., Bruce Samson, Bryant Premium Pork LLC, Buhl's Ridge
View Farm, Charles Rossow, Cheney Farms, Chinn Hog Farm, Circle K
Family Farms LLC, Cleland Farm, Clougherty Packing Company, Coharie
Hog Farm, County Line Swine Inc., Craig Mensick, Daniel J. Pung,
David Hansen, De Young Hog Farm LLC, Dean Schrag, Dean Vantiger,
Dennis Geinger, Double ``M'' Inc., Dykhuis Farms, Inc., E & L
Harrison Enterprises, Inc., Erle Lockhart, Ernest Smith, F & D
Farms, Fisher Hog Farm, Fitzke Farm, Fultz Farms, Gary and Warren
Oberdiek Partnership, Geneseo Pork, Inc., GLM Farms, Greenway Farms,
H & H Feed and Grain, H & K Enterprises, LTD, Ham Hill Farms, Inc.,
Harrison Creek Farm, Harty Hog Farms, Heartland Pork LLC, Heritage
Swine, High Lean Pork, Inc., Hilman Schroeder, Holden Farms Inc.,
Huron Pork, LLC, Hurst AgriQuest, J D Howerton and Sons, J. L.
Ledger, Inc., Jack Rodibaugh & Sons, Inc., JC Howard Farms, Jesina
Farms, Inc., Jim Kemper, Jorgensen Pork, Keith Berry Farms, Kellogg
Farms, Kendale Farm, Kessler Farms, L.L Murphrey Company, Lange
Farms LLC, Larson Bros Dairy Inc., Levelvue Pork Shop, Long Ranch
Inc., Lou Stoller & Sons, Inc., Luckey Farm, Mac-O-Cheek, Inc.,
Martin Gingerich, Marvin Larrick, Max Schmidt, Maxwell Foods, Inc.,
Mckenzie-Reed Farms, Meier Family Farms Inc., MFA Inc., Michael
Farm, Mike Bayes, Mike Wehler, Murphy Brown LLC, Ned Black and Sons,
Ness Farms, Next Generation Pork, Inc., Noecker Farms, Oaklane
Colony, Orangeburg Foods, Oregon Pork, Pitstick Pork Farms Inc.,
Prairie Lake Farms, Inc., Premium Standard Farms, Inc., Prestage
Farms, Inc., R Hogs LLC, Rehmeier Farms, Rodger Schamberg, Scott W.
Tapper, Sheets Farm, Smith-Healy Farms, Inc., Square Butte Farm,
Steven A. Gay, Sunnycrest Inc., Trails End Far, Inc., TruLine
Genetics, Two Mile Pork, Valley View Farm, Van Dell Farms, Inc.,
Vollmer Farms, Walters Farms LLP, Watertown Weaners, Inc., Wen Mar
Farms, Inc., William Walter Farm, Willow Ridge Farm LLC, Wolf Farms,
Wondraful Pork Systems, Inc., Wooden Purebred Swine Farms, Woodlawn
Farms, and Zimmerman Hog Farms.
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Case History
The following events have occurred since the publication of the
preliminary determination in the Federal Register on August 23, 2004.
See Preliminary Negative Countervailing Duty Determination and
Alignment of Final Countervailing Duty Determination With Final
Antidumping Duty Determination: Live Swine from Canada, 69 FR 51800
(August 23, 2004) (``Preliminary Determination'').
On September 9, 2004, the petitioners submitted comments on the
upcoming verifications.
On September 14, 2004, the petitioners submitted arguments relating
to certain requests made by the Government of Canada (``GOC'') for
business proprietary treatment in its questionnaire responses. The GOC
filed a response to this submission on September 22, 2004.
On September 17 and 27, 2004, Sureleen-Albion Agra Inc.
(``Sureleen'')/Bujet Sow Group (``BSG'') and Hytek Ltd. (``Hytek''),
respectively, submitted new factual information and corrections to
their previous responses. The GOC also submitted revised information
from its questionnaire responses on October 5, 2004.
From September 27, 2004 through October 8, 2004, and October 18,
2004 through October 21, 2004, we conducted verification of the
questionnaire responses submitted by the GOC; the Governments of
Ontario, Manitoba, Saskatchewan, and Alberta; Sureleen/BSG; Hytek;
Premium Pork Canada Inc.; Hart Feeds Limited; Elite Swine Inc./Maple
Leaf Foods Inc.; Park View Colony Farms Ltd.; and Willow Creek
[[Page 12187]]
Colony Ltd. We also verified the information submitted by M & F Trading
Inc., Maximum Swine Marketing, and Excel Swine Services, the three
trading companies/cooperatives covered by this investigation, as part
of the verification of the GOC and the provincial governments.
We received case briefs from the petitioners and the Government of
Saskatchewan on January 7, 2005. The respondents (collectively) and the
petitioners submitted rebuttal briefs on January 14, 2005. We held a
hearing in this investigation on January 19, 2005. Public transcripts
from this hearing are available in the Department of Commerce's
(``Department'') Central Records Unit in Room B-099 of the main
Department building (``CRU'').
Period of Investigation
The period for which we are measuring subsidies, or the period of
investigation, is calendar year 2003.
Scope of Investigation
The merchandise covered by this investigation is all live swine
(``swine'' or ``subject merchandise'') from Canada except breeding
stock swine. Live swine are defined as four-legged, monogastric
(single-chambered stomach), litter-bearing (litters typically range
from 8 to 12 animals), of the species sus scrofa domesticus. This
merchandise is currently classifiable under Harmonized Tariff Schedule
of the United States (``HTSUS'') subheadings 0103.91.00 and 0103.92.00.
Specifically excluded from this scope are breeding stock, including
U.S. Department of Agriculture (``USDA'') certified purebred breeding
stock and all other breeding stock. The designation of the product as
``breeding stock'' indicates the acceptability of the product for use
as breeding live swine. This designation is presumed to indicate that
these products are being used for breeding stock only. However, should
the petitioners or other interested parties provide a reasonable basis
to believe or suspect that there exists a pattern of importation of
such products for other than this application, end-use certification
for the importation of such products may be required.
Although the HTSUS headings are provided for convenience and
customs purposes, the written description of the merchandise under
investigation is dispositive.
Scope Comments
In the Notice of Initiation of Countervailing Duty Investigation:
Live Swine From Canada, 69 FR 19818 (April 14, 2004), we invited
comments on the scope of this proceeding. On May 4, 2004, we received a
request from the GOC to amend the scope of this investigation and the
companion antidumping duty (``AD'') investigation. Specifically, the
GOC requested that the scope be amended to exclude hybrid breeding
stock. According to the GOC, domestic producers use hybrid breeding
stock instead of purebred stock to strengthen their strains of swine.
The GOC stated that no evidence was provided of injury, or threat of
injury, to the domestic live swine industry from the importation of
hybrid breeding stock. Furthermore, the GOC noted that the petition
excluded USDA certified purebred breeding swine from the scope of the
above-mentioned investigations. The GOC argued that the documentation
which accompanies imported hybrid breeding swine makes it easy to
distinguish hybrid breeding swine from other live swine.
On August 4, 2004, the petitioners submitted a response to the
GOC's scope exclusion request and proposed modified scope language. The
petitioners stated they did not oppose the GOC's request to exclude
hybrid breeding stock, but were concerned about the potential for
circumvention of any AD or countervailing duty (``CVD'') order on live
swine from Canada through non-breeding swine entering the domestic
market as breeding stock. Thus, the petitioners proposed modified scope
language that would require end-use certification if the petitioners or
other interested parties provide a reasonable basis to believe or
suspect that there exists a pattern of importation of such products for
other than this application. Moreover, on July 30, 2004, the
petitioners submitted a request to the International Trade Commission
(``ITC'') to modify the HTSUS by adding a statistical breakout that
would separately report imports of breeding animals other than purebred
breeding animals, allowing the domestic industry to monitor the import
trends of hybrid breeding stock.
On August 9, 2004, both the GOC and the respondent companies
submitted comments to respond to the petitioners' proposed revised
scope. Both the GOC and the respondent companies stated that they
generally agreed with the petitioners' modified scope language, with
the two following exceptions: 1) they contended that the petitioners'
language setting forth the mechanics of any end use certification
procedure was premature and unnecessary, and 2) they argued that the
petitioners' language stating that ``all products meeting the physical
description of subject merchandise that are not specifically excluded
are included in this scope'' was unnecessary because the physical
description of the merchandise in scope remains determinative.
On August 12, 2004, the petitioners submitted a response to the
August 9, 2004 comments from the GOC and the respondents. The
petitioners reiterated their support for their proposed modification to
the scope language. They argued that 1) their proposed language had
been used before by the Department in other proceedings; 2) since U.S.
importers bear the burden of paying the duties, the importers should be
required to certify to the end use of the product; and 3) with the
petitioners' concerns about circumvention, the ``physical description''
language provided an important clarification that all live swine except
for the excluded products are included in the scope.
As further discussed in the August 16, 2004 memorandum entitled
``Scope Exclusion Request: Hybrid Breeding Stock'' (on file in the
Department's CRU), we preliminarily revised the scope in both the CVD
and companion AD proceedings based on the above scope comments. See
Preliminary Determination, 69 FR 81800, 51801-51802, and Notice of
Preliminary Determination of Sales at Less Than Fair Value and
Postponement of Final Determination: Live Swine from Canada, 69 FR
61639, 61640-61641 (October 20, 2004). No further scope comments were
received from any party subsequent to these preliminary determinations.
Thus, we have adopted the revised scope from the Preliminary
Determination for this final determination. The revised scope language
is included in the ``Scope of Investigation'' section, above.
Injury Test
Because Canada is a ``Subsidies Agreement Country'' within the
meaning of section 701(b) of the Tariff Act of 1930, as amended by the
Uruguay Round Agreements Act effective January 1, 1995 (``the Act''),
the ITC is required to determine whether imports of the subject
merchandise from Canada materially injure, or threaten material injury
to, a U.S. industry. On May 10, 2004, the ITC transmitted to the
Department its preliminary determination that there is a reasonable
indication that an industry in the United States is being materially
injured by reason of imports from Canada of the subject merchandise.
See Live Swine From Canada, 69 FR 26884 (May 14, 2004).
[[Page 12188]]
Analysis of Comments Received
All issues raised in the case and rebuttal briefs by parties to
this investigation are addressed in the March 4, 2005 ``Issues and
Decision Memorandum'' from Barbara E. Tillman, Acting Deputy Assistant
Secretary for Import Administration, to Joseph A. Spetrini, Acting
Assistant Secretary for Import Administration (``Decision
Memorandum''), which is hereby adopted by this notice. Attached to
this notice as an appendix is a list of the issues which parties have
raised and to which we have responded in the Decision Memorandum.
Parties can find a complete discussion of all issues raised in this
investigation and the corresponding recommendations in this public
memorandum, which is on file in the CRU. In addition, a complete
version of the Decision Memorandum can be accessed directly on the
Internet at https://enforcement.trade.gov/frn/ under the heading ``Canada.''
The paper copy and electronic version of the Decision Memorandum are
identical in content.
Suspension of Liquidation
In the Preliminary Determination, the total net countervailable
subsidy rate was de minimis and, therefore, we did not suspend
liquidation. For the final determination, because the rate remains de
minimis, we are not directing U.S. Customs and Border Protection to
suspend liquidation of live swine from Canada.
ITC Notification
In accordance with section 705(d) of the Act, we will notify the
ITC of our determination.
Return or Destruction of Proprietary Information
This notice serves as the only reminder to parties subject to
Administrative Protective Order (``APO'') of their responsibility
concerning the destruction of proprietary information disclosed under
APO in accordance with 19 CFR 351.305(a)(3). Failure to comply is a
violation of the APO.
This determination is published pursuant to sections 705(d) and
777(i) of the Act.
Dated: March 4, 2005.
Joseph A. Spetrini,
Acting Assistant Secretary for Import Administration.
Appendix
List of Comments and Issues in the Decision Memorandum
Comment 1: Specificity
Comment 2: Green Box Claims
Comment 3: Agricultural Income Disaster Assistance Program Recurring
vs. Nonrecurring
Comment 4: Quebec Farm Income Stabilization Insurance/Agricultural
Revenue Stabilization Insurance Program
Comment 5: Saskatchewan Short-Term Hog Loan Program
Comment 6: Saskatchewan Livestock and Horticultural Facilities
Incentives Program
[FR Doc. E5-1030 Filed 3-10-05; 8:45 am]