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Commerce Drops Xanthan Gum Exporter's 154.07% AD Rate to 0% on Remand

The Commerce Department on remand at the Court of International Trade reduced the antidumping duty rate for respondent Meihua Group International Trading (Hong Kong) from 154.07% to zero percent in the 2019-20 review of the AD order on xanthan gum from China. The agency reviewed its use of adverse facts available against the company due to the exporter's explanation that its U.S. duties and Section 301 duties are "subject to a possible recalculation" (Meihua Group International Trading (Hong Kong) v. United States, CIT Consol. # 22-00069).

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In the review, Commerce asked Meihua for information on the duties it paid on its entries, though it later became clear that this information could change given the exporter's claims for Section 301 exclusions. Commerce said Meihua's initial submissions on its U.S. duties and sales database was incomplete, resorting to AFA.

CIT rejected this position in the case's first opinion (see 2304200010). After the agency stuck by its use of AFA, the court again rejected Commerce's claims, finding that the agency's initial questionnaire only asked for information about Meihua's duties paid, which the company provided. The agency didn't initially ask if those duty amounts would change, the court noted (see 2402220063).

On remand again, Commerce decided to drop the use of AFA due to the respondent's explanation that its duties are subject to recalculation. The agency said since "time constraints" bar it from coming up with an AD rate based on an "alternate source of information," it used the "final usable U.S. sales database reported by Meihua."

In its second opinion, CIT also sent back Commerce's failure to rescind the review for exporter Deosen Biochemical and to conduct a new collapsing analysis of the company and Deoseng Bioechemical (Ordos). On remand, Commerce conducted a new collapsing analysis and considered Deosen Biochemical's certification that it made no shipments during the review period.

Due to this new information, Commerce said it found that the company "has provided sufficient evidence that Deosen Biochemical was not capable of producing xanthan gum or similar like product during the POR without substantial retooling." As a result, the agency said Deosen Biochemical shouldn't be collapsed with Deosen Ordos and that the review should be rescinded for Deosen Biochemical.