Commerce Raises Keg Exporter's AD Rate After Adopting Brazilian Wage Data for Surrogate Value

The Commerce Department on March 26 set a higher antidumping duty rate for exporter Ningbo Master International Trade in the investigation on beer kegs from China after electing on remand to use Brazilian wage data for the surrogate labor value. The exporter's rate. if sustained by the Court of International Trade, would rise from a de minimis mark to 4.23%, lifting the separate rate applicants' AD mark with it by an equal amount (New American Keg v. United States, CIT # 20-00008).

The remand results mark the third of their kind from Commerce following a yearslong dispute on the proper labor surrogate value. Judge M. Miller Baker previously sent back the agency's use of a Mexican wage rate adjusted with Brazilian inflation data to calculate Ningo Master's surrogate labor costs, asking Commerce why it wasn't better to just use the Brazilian data.

In its second remand, Commerce dropped the Brazilian inflation data but reopened the record to use a new Mexican data set taken from the Mexican International Labour Organization (see 2401310064). The court rejected this move, finding that Commerce abused its discretion in reopening the record since the agency failed to show that the Brazilian wage information was "inaccurate or otherwise unsuitable."

The court said that the Brazilian data should have been used given the "data difficulties" with the Mexican data, seeing as it needed a Brazilian adjustor, while no such difficulties existed for the Brazilian data.

On remand, Commerce said that with this ruling in mind, it "finds no definitive information on the record showing that the Brazilian wage information is inaccurate or otherwise unsuitable for the calculation of Ningbo Master’s margin," electing to use the Brazilian data. The agency added that it can inflate the data with the "Brazilian CPI to satisfy the contemporaneity requirement in valuing labor, whereas we are not able to do so using the Mexican ILC data.

"Accordingly, we used the Brazilian labor SV from 2016, inflated to the POI, and recalculated Ningbo Master’s margin for these final results of redetermination."

While not contesting the use of the Brazilian data, petitioner New American Keg took issue with Commerce's decision to grant exporter Guangzhou Ulix a separate AD rate since the company allegedly is affiliated with its U.S. customer. The agency said that, contrary to the allegations, "Guangzhou Ulix’s description of its price negotiations with its U.S. customer was not shown to be unreliable nor was there a 'shifting narrative' from Guangzhou Ulix."