Pure and Alloy Magnesium From Canada and Pure Magnesium from China

194 Pages·2006·1.39 MB·English

Pure and Alloy Magnesium From Canada
and Pure Magnesium From China
Investigation Nos. 701-TA-309-A-B and 731-TA-696 (Second Review)
Publication 3859 July 2006
U.S. International Trade Commission
COMMISSIONERS
Daniel R. Pearson, Chairman
Shara L.Aranoff, Vice Chairman
JenniferA. Hillman
Stephen Koplan
Deanna Tanner Okun
Charlotte R. Lane
RobertA.Rogowsky
DirectorofOperations
Staffassigned
FredFischer,Investigator
JeremyWise,Investigator
VincentDeSapio,IndustryAnalyst
RobertHughes,Economist
IoanaMic,Economist
CharlesYost,Accountant
JonathanEngler,Attorney
PeterSultan,Attorney
StevenHudgens,Statistician
GeorgeDeyman, SupervisoryInvestigator
Address all communications to
Secretary to the Commission
United States InternationalTrade Commission
Washington, DC 20436
U.S. International Trade Commission
Washington,DC20436
www.usitc.gov
Pure and Alloy Magnesium From Canada
and Pure Magnesium From China
Investigation Nos. 701-TA-309-A-B and 731-TA-696 (Second Review)
Publication 3859 July 2006

Inv. No. 701-TA-309-A-B and 731-TA-696 (Second Review) Pure and Alloy Magnesium
CONTENTS
Page
Determinations and Views of the Commission ...................................... 1
Determinations ............................................................. 1
Views of the Commission ..................................................... 3
Views of Chairman Pearson and Commissioners Okun and Lane ................... 6
Views of Vice Chairman Aranoff and Commissioners Hillman and Koplan ........... 34
Part I: Introduction and overview ................................................ I-1
Background ................................................................ I-1
Pure and alloy magnesium from Canada (second review) ......................... I-1
Pure magnesium from China (second review) .................................. I-2
The original investigations ................................................. I-4
The initial five-year reviews ................................................ I-5
Other Title VII investigations ............................................... I-6
Section 332 investigations ................................................. I-6
Summary data from the original investigations and reviews ....................... I-8
Statutory criteria and organization of the report ................................. I-9
Commerce’s second five-year reviews ........................................... I-10
Pure and alloy magnesium from Canada ...................................... I-10
Pure magnesium from China ................................................ I-11
Commerce’s initial five-year reviews ............................................ I-11
Pure and alloy magnesium from Canada ...................................... I-11
Pure magnesium from China ................................................ I-11
Commerce’s administrative and new shipper reviews ............................... I-12
Pure and alloy magnesium from Canada ...................................... I-12
Pure magnesium from China ................................................ I-12
Distribution of Continued Dumping and Subsidy Offset Act funds to affected domestic
producers ........................................................... I-13
The subject products ......................................................... I-15
Canada................................................................. I-15
China .................................................................. I-15
U.S. tariff treatment ...................................................... I-16
Description and uses ...................................................... I-16
Manufacturing process .................................................... I-21
Domestic like product issues ................................................... I-25
The Commission’s previous like product determinations concerning magnesium from
Canada ............................................................. I-25
The Commission’s previous like product determinations concerning magnesium from
China .............................................................. I-26
Pure vs. alloy magnesium .................................................. I-27
Primary vs. secondary magnesium ........................................... I-30
Cast vs. granular magnesium ............................................... I-31
U.S. market participants ...................................................... I-32
U.S. producers ........................................................... I-32
U.S. importers ........................................................... I-33
U.S. purchasers .......................................................... I-34
Apparent U.S. consumption and market shares ..................................... I-34
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Inv. No. 701-TA-309-A-B and 731-TA-696 (Second Review) Pure and Alloy Magnesium
CONTENTS–Continued
Page
Part II: Conditions of competition in the U.S. market ............................... II-1
U.S. market segments and channels of distribution .................................. II-1
Pure vs. alloy magnesium .................................................. II-1
Off-spec vs. pure and/or alloy magnesium ..................................... II-2
Geographic markets ...................................................... II-2
Supply and demand considerations .............................................. II-2
U.S. supply ............................................................. II-2
U.S. demand ............................................................ II-5
Substitutability issues ........................................................ II-7
Factors affecting purchasing decisions ........................................ II-8
Comparisons of domestic products and subject imports ........................... II-10
Comparisons of U.S. product and subject imports with nonsubject imports ........... II-15
Elasticity estimates .......................................................... II-16
U.S. supply elasticity ..................................................... II-16
Subject import supply elasticity ............................................. II-16
U.S. demand elasticity .................................................... II-16
Substitution elasticity ..................................................... II-16
Part III: Condition of the U.S. industry ........................................... III-1
U.S. producers’ capacity, production, and capacity utilization ......................... III-3
U.S. producers’ domestic shipments, company transfers, and export shipments ........... III-3
U.S. producers’ imports, purchases, and related-party considerations ................... III-4
U.S. producers’ inventories .................................................... III-4
U.S. producers’ employment, wages, and productivity ............................... III-5
Financial experience of U.S. producers ........................................... III-5
Background ............................................................. III-5
Operations on pure and alloy magnesium ...................................... III-6
Tolling of alloy magnesium ................................................ III-9
Value added ............................................................ III-9
Variance analysis ........................................................ III-9
Capital expenditures and research and development expenses ...................... III-10
Assets and return on investment ............................................. III-10
Part IV: U.S. imports and the industries in Canada and China ........................ IV-1
U.S. imports ................................................................ IV-1
U.S. producers’ imports ....................................................... IV-2
U.S. importers’ shipments ..................................................... IV-2
U.S. importers’ inventories .................................................... IV-2
U.S. importers’ current orders .................................................. IV-2
The industry in Canada ....................................................... IV-3
Norsk Hydro ............................................................ IV-4
Magnola ............................................................... IV-5
Timminco Canada ........................................................ IV-6
Other Canadian projects ................................................... IV-6
The industry in China ........................................................ IV-6
Antidumping duty orders in third-country markets .................................. IV-9
The world market ........................................................... IV-9
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Inv. No. 701-TA-309-A-B and 731-TA-696 (Second Review) Pure and Alloy Magnesium
CONTENTS–Continued
Page
Part V: Pricing and related information ........................................... V-1
Factors affecting pricing ...................................................... V-1
Transportation costs to the United States ...................................... V-1
U.S. inland transportation .................................................. V-1
Exchange rates .............................................................. V-1
Pricing practices ............................................................ V-2
Pricing methods ......................................................... V-3
Sales terms and discounts .................................................. V-3
Price data .................................................................. V-4
Price trends and comparisons ............................................... V-6
Appendixes
A. Federal Register notices and the Commission’s statements on adequacy ................. A-1
B. Hearing calendar ............................................................ B-1
C. Summary data .............................................................. C-1
D. Comments regarding the effects of the countervailing duty orders and the antidumping duty
order and the likely effects of revocation ....................................... D-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.
iii

UNITED STATES INTERNATIONAL TRADE COMMISSION
Investigation Nos. 701-TA-309-A-B and 731-TA-696 (Second Review)
PURE AND ALLOY MAGNESIUM FROM CANADA AND PURE MAGNESIUM FROM CHINA
DETERMINATIONS
On the basis of the record1 developed in the subject five-year reviews, 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 countervailing duty orders on pure and alloy
magnesium from Canada 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.
With respect to China, revocation of the antidumping duty order on pure magnesium would be
likely to lead to continuation or recurrence of material injury to an industry in the United States within a
reasonably foreseeable time.
BACKGROUND
With respect to Canada, the Commission instituted the reviews on July 1, 2005 (70 F.R. 38199)
and determined on October 4, 2005 that it would conduct full reviews (70 F.R. 60108, October 14, 2005).
With respect to China, the Commission instituted the review on September 1, 2005 (70 F.R. 52122) and
determined on December 5, 2005 that it would conduct a full review (70 FR 75483, December 20, 2005).
Notice of the scheduling of the Commission’s reviews 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 January 12,
2006 (71 F.R. 2065). The hearing was held in Washington, DC, on April 25, 2006, 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)).
1