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Coated Free Sheet Paper From China, Indonesia, and Korea - page 88 / 198

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the United States. It also notes that West Linn manufactures CFS in its West Linn, OR plant.19 Paper merchants appearing at the Commission’s conference (specifically PaperlinX and Unisource) testified that many domestic mills are “unable” to or not “interested” in providing nationwide distribution rights or extending lines to them outside of their current trading areas.20 With reference to the issue of transportation costs, Korean respondents include freight rates tables as exhibit 2 to their postconference brief.

Table IV-3 provides U.S. imports for CFS paper aggregated by district of entry into the United States for 2003-05, January-September 2005, and January-September 2006. As shown, the bulk of merchandise from each subject source is entering into the western portion of the United States, although there are import entries of CFS paper from each subject country within each U.S. geographical area.21

THE QUESTION OF NEGLIGIBLE IMPORTS

The statute (section 771(24)(A)(i) of the Act) provides that imports from a subject country corresponding to the domestic like product are negligible if such imports account for less than 3 percent of the volume of all such merchandise imported into the United States in the most recent 12-month period for which data are available that precedes the filing of the petition - in this case October 2005 through September 2006.22 The statute (section 771(24)(B) of the Act) further provides that in an investigation under section 701, imports of subject merchandise from developing countries are negligible if such imports account for less than 4 percent of the volume of all such merchandise imported into the United States in the specified 12-month period. In accordance with section 771(B) of the Act, the United States Trade Representative has designated Indonesia as a developing country under the countervailing duty law.23 24

Table IV-4 presents official Commerce statistics for the 12-month period October 2005 through September 2006. As indicated in the table, imports of coated free sheet paper from China accounted for *** percent of total U.S. imports, imports from Indonesia accounted for 4.1 percent, and imports from Korea accounted for *** percent of total U.S. imports. The data for China and Korea are compiled from official Commerce statistics, and those for Indonesia were submitted by counsel for the Indonesian industry.25

19

Petitioner’s postconference brief, pp. 49-50.

20 Conference transcript, p. 99 (Anderson) and pp. 115-116 (Dragone), as cited in the Chinese respondents and Unisource's postconference brief, pp. 14-15.

21 While official Commerce statistics for Indonesia are understated, the available data indicate that relatively small quantities of CFS paper from Indonesia were imported into the Gulf coast ports. The volume of such imports have, however, increased steadily throughout the period examined after an initial drop-off from 2003 to 2004.

22 Also, section 771(24)(A)(iv) of the Act provides that the Commission shall not treat imports as negligible if it determines that there is a potential that imports found to be negligible will imminently account for more than 3(4) percent of total subject imports.

23

15 CFR § 2013.1.

24 Petitioner points out that Asia Pulp & Paper maintains CFS plants in both Indonesia and China and argues that any termination of the subsidy investigation involving Indonesia “would likely divert production for its U.S. customers from its Chinese mills to its Indonesian mills.” Petition, p. 19. See exh. I-15 of the petition for ***. Asia Pulp and Paper is identified in that exhibit as ***.

25 Because of the apparent under reporting of U.S. imports from Indonesia in official Commerce statistics, table IV-4 presents data for export shipments to the United States as submitted by the Indonesian industry in response to a staff request. E-mail from Adams Lee, White & Case, December 7, 2006. If official Commerce statistics are used for Indonesia, such imports accounted for 3.2 percent of total U.S. imports for the 12-month period.

IV-8

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