Saccharin from China - USITC

and subject imports were “always” or “frequently” interchangeable. 154 While there is information onthe record suggesting that some purchasers and importers may regard the subject merchandise asinferior in quality to domestically produced saccharin, 155 Chinese subject producers neverthelessshipped significant volumes of saccharin into the U.S. market during the review period.In this review, the Commission collected pricing data on five different products that accountedfor almost 100 percent of PMC’s total reported U.S. commercial saccharin shipments and 4.5 percent ofsubject imports between 2003 and 2008. 156 These data indicate that, despite the discipline of the order,there was still a majority of instances of underselling by subject imports (*** of *** possiblecomparisons between subject imports and the domestic like product involving margins that ranged from1.1 to 673.9 percent). 157The degree of underselling during the period of review under the discipline of the order,together with the significant underselling during the original investigation, indicates that underselling islikely to be significant if the order is revoked. Moreover, there is evidence that the U.S. market isattractive for subject imports because of the relatively high U.S. prices for saccharin compared to othermarkets. 158 In light of the above, we find that the likely significant quantities of low-priced subjectimports would likely be priced aggressively to gain market share, and they would undersell the domesticlike product, and this underselling would significantly suppress and/or depress U.S. prices forsaccharin. 159 For all of the foregoing reasons, we conclude that subject imports from China are likely tohave significant adverse price effects in the event that the order were revoked.3. Likely Impact of Subject ImportsIn evaluating the likely impact of imports of subject merchandise if the order under review isrevoked, the Commission is directed to consider all relevant economic factors that are likely to have abearing on the state of the industry in the United States, including but not limited to the following:(1) likely declines in output, sales, market share, profits, productivity, return on investments, andutilization of capacity; (2) likely negative effects on cash flow, inventories, employment, wages, growth,ability to raise capital, and investment; and (3) likely negative effects on the existing development andproduction efforts of the industry, including efforts to develop a derivative or more advanced version of154Eight purchasers reported that U.S.-produced saccharin and subject merchandise were “always” or“frequently” interchangeable, while just one purchaser reported that they were “sometimes” interchangeable, andjust one purchaser reported that they were “never” interchangeable. CR/PR at Table II-5.155CR at II-8; PR at II-5.156See, e.g., CR at V-4; PR at V-3.157See, e.g., CR at V-13; PR at V-4 & CR/PR at Table V-6.158See, e.g., Hearing Tr. at 128, 136 (“prices outside the U.S. have been much lower” and “European pricing ismuch lower than U.S. pricing.”) (Delaney); See also, PMC Prehearing Br. at 32. While U.S. saccharin prices weresubstantially higher in 2008 than earlier in the review period, we note that 2008 was reportedly aberrational in termsof higher prices. Prices generally increased over the review period. While prices increased to a very large extentduring 2008, we note these prices involved relatively small sales quantities, and appear to have reflected a pricespike that was the result of a world-wide shortage of saccharin that we do not find likely to continue. CR at V-4; PRat V-3. We also note that, if 2008 were excluded, subject imports undersold the domestic like product in *** of ***quarterly price comparisons. CR at V-13; PR at V-4.159As noted above, Mr. Dennis Delaney, Sales Manager at TR International, testified at the hearing on behalf ofsubject producer Tianjin Changjie. Mr. Delaney testified that U.S. prices for saccharin would “come downsubstantially” if the order were revoked. Hearing Tr. at 138. Mr. Delaney also testified that, if the order wererevoked, U.S. saccharin prices would decline because subject producers would enter the U.S. market at such lowprices. Hearing Tr. at 137-138.20