ITC Continues to Cumulate Russian, Argentinian, Mexican and Some South Korean OCTG in Injury Finding

The trade court remanded an injury investigation in April regarding Russian oil country tubular goods, saying that it wasn’t clear, after the implementation of sanctions, that Russian imports were still injuring U.S. producers “in the present tense on vote day.” On remand, the ITC continued to cumulate OCTG from Argentina, Mexico, Russia and South Korea to find that imports had materially injured domestic U.S. producers, saying that the inclusion of Russia was instead based on petitioners’ filing date.

However, the ITC removed certain non-subject South Korean imports from the analysis that were exported by Hyundai Steel Co. But it said that subject South Korean imports, not shipped from Hyundai, still met the “reasonable overlap of competition” threshold to require cumulation, although it said in its conclusion that it was “again” finding injury to domestic industry due only to imports from Argentina, Mexico and Russia.

Exporter Tenaris Bay City and importers led by TMK Group petitioned the trade court in 2022 claiming, among other things, that the ITC had wrongly included Russian and South Korean imports in its OCTG investigation. The South Korean goods weren’t subject imports, they said, and the ITC had failed to evaluate the impact of U.S. OCTG sanctions -- levied at the start of the Ukrainian War, four months prior to the ITC’s 2022 vote -- on Russian imports.

CIT Judge Jennifer Choe-Groves agreed on both counts and remanded the decision (see 2404220036). The commission had failed to address whether Russian OCTG had been harming domestic production on the day that it voted, she ruled; or to consider contrary evidence that showed the sanctions were a “major setback” for Russian exporters. And “harmless error” wasn’t a good enough reason to keep the South Korean imports in the analysis, she said.

First, in regard to the Russian OCTG, the ITC said that the “vote day” standard, supported by the case Chaparral, had become outdated after the Uruguay Round Agreements Act. In URAA, Congress established that cumulation occurs on the date an investigation petition is filed, it said.

The ITC argued that the URAA’s Statement of Administrative Action supported this interpretation. It said the SAA holds that the ITC can only cumulate imports from different countries if those countries’ investigations were initiated on the same day, but that “staggered investigations” are based on the leading investigaton’s record.

"This eliminates the need for the Commission to consider whether imports from the first-decided investigation that are subject to antidumping or countervailing duty orders have a 'continuing effect' on 'vote day' of each subsequent investigation," it said, citing the statement.

It acknowledged that the current case doesn’t involve staggered investigations, but said that the statement “provides further indication that ‘vote day’ is not the operative time frame for assessing the cumulation factors.”

And to allow otherwise also would conflict with the requirement that the ITC close the record and allow parties one final comment on it prior to making its determination, it said.

However, it also said that it still gave “additional consideration to the potentially contrary evidence and arguments.” It said it found them unconvincing.

The plaintiffs highlighted testimony from high-level employees in the import and export companies party to the case. They also said that the existence of Russian OCTG imports after the sanctions’ imposition was due to lag time and a gap in the tariff code not remedied until four months later. The investigation’s purchaser questionnaires, meanwhile, didn’t “reflect purchasers’ impressions of Russian OCTG following the revocation of API certification services” because they were issued around the same time, the plaintiffs said.

However, the ITC again said that Russian-origin green tubes could still be imported into the U.S. and processed. This could be done without detection because a needed certification, it noted, requires that green tube processors “shall remove any identity that is not indicative of the new condition of the product as a result of heat treatment (for example, prior grade identity and original pipe manufacturer’s name or logo.)”

U.S. processors had also purchased OCTG and subject imported green tube from Russia in the past, meaning they had existing relationships with Russian suppliers, it added.

Second, the commission argued that, after the accidental inclusion of Hyundai's imports was remedied, the imports’ degree of fungibility with U.S. goods, as well as their shared geographic markets, channels of distribution and actual presence, were enough to support cumulation.

“We continue to find that there existed a sufficient degree of competitive overlap to require the cumulative assessment of subject imports,” it said. “As noted, we adopt in full our analysis and findings from our Original Views concerning all other aspects of our determinations.”

But neither its introduction nor its conclusion mentioned the subject South Korean goods: In its conclusion -- one sentence later -- it said that, “for the foregoing reasons, we again determine that an industry in the United States is materially injured by reason of subject OCTG from Argentina and Mexico that have been found by Commerce to be sold in the United States at [less than fair value] and by reason of imports of OCTG from Russia that have been found by Commerce to be sold in the United States at LTFV and subsidized by the government of Russia.”