                                        Slip Op. 03-73

               UNITED STATES COURT OF INTERNATIONAL TRADE

__________________________________________

THE COMMITTEE FOR FAIR BEAM                        :
IMPORTS, ET AL.,
                                                   :
                      Plaintiffs,
                                                   :
              v.
                                                   :       Ct. No. 02-00531
UNITED STATES, and THE
UNITED STATES INTERNATIONAL                        :       Public Version
TRADE COMMISSION,
                                                   :
                      Defendants,
                                                   :
                      and
                                                   :
SALZGITTER AG STAHL UND
TECHNOLOGIE, ET AL.,                               :

                  Defendant-Intervenors.   :
__________________________________________

[Plaintiffs’ Motion for Judgment upon an Agency Record is denied.]

                                                           Decided: June 27, 2003

Wiley Rein & Fielding LLP, Charles Owen Verrill, Jr., Alan H. Price, (John R. Shane), Daniel B.
Pickard, for Plaintiffs.

Lyn M. Schlitt, General Counsel, Office of General Counsel, United States International Trade
Commission, James M. Lyons, Deputy General Counsel, (Marc A. Bernstein), for Defendants.

DeKieffer & Horgan, (J. Kevin Horgan), Marc E. Montalbine, Merritt R. Blakeslee, Wakako O.
Takatori, for Defendant-Intervenor Salzgitter AG Stahl und Technologie.

Shearman & Sterling, Jeffrey M. Winton, (Christopher M. Ryan), for Defendant-Intervenors
Stahlwerk Thuringen Gmbh, TradeARBED, Inc., ProfilARBED, S.A., and Aceralia Corporacion
Siderurgica, S.A.
Ct. No. 02-00531                                                                       Page 2

                                            OPINION

BARZILAY, JUDGE:

                                        I. INTRODUCTION

       Plaintiffs, The Committee for Fair Beam Imports and its individual members, Nucor

Corporation, Nucor-Yamato Steel Company, and TXI Chaparral Steel Company, (collectively

“Fair Beam” or “domestic industry”) challenge the final negative material injury and the final

negative threat of material injury determinations of the United States International Trade

Commission (“ITC” or “Commission”), set forth in Certain Structural Steel Beams from China,

Germany, Luxembourg, Russia, South Africa, Spain and Taiwan, Invs. Nos. 731-TA-935-936

and 938-942 (Final), USITC Pub. No. 3522 (June 2002) (“Final Determination” or “Beams II”)1

and made pursuant to 19 U.S.C. §§ 1671d(b) and 1673d(b) (1999). This court has jurisdiction

pursuant to 19 U.S.C. § 1516a(a)(1) and 28 U.S.C. § 1581(c). For the reasons outlined below,

Fair Beam’s USCIT R. 56.2 Motion for Judgment upon an Agency Record is denied.

                                        II. BACKGROUND

A.     Procedural History.

       On May 23, 2001, the domestic industry filed petitions with the United States Department

of Commerce (“Commerce”) and the Commission which led to investigations by both

       1
         This opinion cites to the version of this document included in Administrative Record,
List 2, Doc. No. 170.
Ct. No. 02-00531                                                                       Page 3

concerning structural steel beams of certain specifications2 imported from China, Germany,

Luxembourg, Russia, South Africa, Spain, and Taiwan (“subject countries” or “respondents”).3

Preliminary results were issued by the Commission on July 16, 2001, and by Commerce, on

December 28, 2001. In May 2002, Commerce issued its final determinations. See 67 Fed. Reg.

35,479 - 35,490 & 35,497. A hearing was held before the Commission on May 15, 2002.4

Notice of the Commission’s final determination was published in the Federal Register on June

27, 2002. See 67 Fed. Reg. 43,340. A panel of five Commissioners found no present material

injury from subject imports. One Commissioner, however, dissented from the panel’s negative

determination with regard to threat of material injury.

B.     The product and the U.S. market.

       Structural steel beams are load-bearing support members in the construction of large steel

structures, such as buildings, bridges, towers, pre-fabricated homes, ships, and equipment.

Demand for structural beams fluctuates in tandem with construction activity which in turn tracks

       2
          The subject of this investigation is “doubly-symmetric shapes, whether hot-or cold-
rolled, drawn, extruded, formed or finished, having at least one dimension of at least 80 mm (3.2
inches or more), whether of carbon or alloy (other than stainless) steel, and whether or not
drilled, punched, notched, painted, coated, or clad.” E.g., Notice of Final Determination of Sales
at Less than Fair Value: Structural Steel Beams from the People’s Republic of China, 67 Fed.
Reg. 35,479 (May 20, 2002). The court notes that no scope or domestic like product issues are
raised in this appeal.
       3
         Initially, Italy was also investigated. However, upon a finding of no dumping by
Commerce, the ITC discontinued its investigation of Italian structural beams. For the same
reason, one company from the People’s Republic of China was eliminated from the investigation.
The court further notes that no cumulation issues are raised in this appeal.
       4
        “ITC Hearing Tr.” will signify the transcript of this administrative hearing, portions of
which are included in tab 5 of Plaintiffs’ Appendix.
Ct. No. 02-00531                                                                            Page 4

aggregate U.S. economic activity. Certain Structural Steel Beams from China, Germany,

Luxembourg, Russia, South Africa, Spain, and Taiwan, Staff Report to the Commission on Invs.

Nos. 731-TA-935-936 and 938-942 (Final) at I-6 & II-10 (June 3, 2002) (“Staff Report”) in

Administrative Record, List 2, Doc. No. 169. In the U.S. market, there are two types of

purchasers of structural steel beams: distributors (or service centers) and end users (or

fabricators).5 Id. at II-1. Imported product is mostly sold to distributors; end users, however,

typically buy from domestic suppliers. Distributors keep inventories while end users do not.

Domestic mills charge the same price to both distributors and end users. In the event an end user

buys from a distributor, it accordingly pays a higher price. Purchasers rank domestic product

superior in availability and delivery time6 to imported product, but inferior in price. Id. at II-13.

On the other hand, domestic and imported product are perceived to be comparable in product

quality and consistency. Purchasers of structural steel beams report evaluating factors such as

price, quality, and availability in determining whether to purchase domestic or imported beams

and rank these factors in a descending order of importance.7 Id. at II-12.

       5
           Construction companies are the ultimate users of the finished product.
       6
         There is a three to five month “lead time” for subject imports whereas the lead time for
domestic beams is shorter, Final Determination at 23, although not by “very much,” ITC
Hearing Tr. at 26 (testimony of domestic executive). Orders for beams are therefore necessarily
a function of perceptions of future demand and not of current demand conditions.
       7
          Price comes before all else under normal circumstances according to testimony offered
at the administrative hearing. See ITC Hearing Tr. at 49 (“Price is the defining factor in
determining who receives the order.”). The ITC in the Final Determination, however, paid
virtually no heed to this information because of its implicit finding that in a time of supply
shortage, purchasers are willing to pay more to circumvent the domestic unavailability of the
product – which determination is more fully explained below. In connection with the price
variable, the court also notes that at the administrative hearing at least one respondent witness
Ct. No. 02-00531                                                                            Page 5

        The short-term price elasticity of U.S. demand for structural steel beams is low reflecting

lack of substitutes for steel beams in construction, especially after the design phase of

construction is complete. Id. at II-9. In other words, once the quantity of beams requested is set,

later price variation will have no or little effect.8

        On the supply side, the price elasticity of domestic supply is lower than that of the subject

countries’ supply. Staff Report at II-16 & 17. That is, subject countries can respond to price

changes in the U.S. market faster than domestic producers can in terms of increasing shipments

to the U.S. market.9 The price elasticity of supply is dependent on excess capacity, ability to shift

production or alter capacity, inventories, and availability of alternate markets. The relatively

greater flexibility of the subject countries is partially due to the existence of home markets and

alternate export markets from which they are able to divert products to the U.S. market with

relative ease.

        The largest share of cost in the production of structural steel beams is that of steel scrap,

the raw material from which beams are produced. Id. at V-I. Thus, the supply of beams is tied to

denoted respondents as price takers. See id. at 199-200. In other words, respondents normally
peg their price to that of the market leader, Nucor, a domestic producer. In this period, however,
because Chaparral Steel, another domestic producer, “was playing a little bit havoc with the
market,” Chaparral Steel’s price was matched. Id. at 200.
        8
         Potential long-run substitutes for structural steel beams include reinforced concrete,
structural tubing or wood. Staff Report at II-10 & 11. The Staff Report also indicated that
“building design typically precedes construction and material purchases by months or even
years,” which period can be termed “the long-run” in this context. Id. at II-11.
        9
         The Staff Report estimated that for every one percent increase in U.S. price, domestic
producers could increase shipments either by one or two percent, as opposed to ten or twenty
percent by subject countries. Staff Report at II-17.
Ct. No. 02-00531                                                                         Page 6

the price of steel scrap.10 It has also been determined that in offers domestic producers use price

lists whereas sales of subject imports are on a transaction-by-transaction basis, price and quantity

being determined by the then existing market conditions.11 Staff Report at V-7.

C.     The ITC’s findings in the Final Determination.

       In the Final Determination, the ITC evaluated the prevailing market conditions during the

period of investigation (“POI”). See Final Determination at 17-21. Consulting Census Bureau

statistics, the ITC determined that nonresidential construction activity in the United States, which

is an indicator of U.S. demand for structural steel beams, increased from 1999 to 2000 and

declined in 2001. Using its own questionnaires and official Commerce import statistics, the ITC

further observed that apparent U.S. consumption of steel beams rose from 4.96 million short tons

in 1999 to 6.23 million in 2000, and then declined to 4.81 million in 2001.

       The ITC next noted that the domestic industry experienced supply difficulties during

1999 and the first half of 2000. The ITC based this finding on questionnaire responses of forty-

five purchasers, eighteen of which (sixteen of thirty-one distributors) represented that they either

were put on “allocation” during this time period by domestic producers or were otherwise unable

to meet their requirements from domestic suppliers. The ITC further noted questionnaire

responses of the largest domestic producers which confirmed that purchasers were “allocated a

       10
          During this period of investigation, scrap prices increased throughout 1999, reaching a
peak in January 2000, and followed a general declining trend for the rest of the period, arriving at
a low in November 2001. Staff Report at V-1.
       11
          In the Final Determination, the ITC observed that domestic producers on occasion
deviated from list prices. Final Determination at 26 n.100.
Ct. No. 02-00531                                                                            Page 7

portion of production based on historical levels of purchases” in applicable products.12 Staff

Report at II-2. The ITC also referenced news articles in trade publications which reported a

domestic supply shortage in this time period.13

        The ITC’s finding of domestic supply shortage was informed by an additional observation

that imports of structural steel beams from Japan became subject to a June 2000 antidumping

duty order, and imports of structural steel beams from Korea became subject to antidumping and

countervailing duty orders in August 2000.

        Finally, the ITC noted the changes to domestic production during the POI. Two new

domestic mills (Nucor and TXI) became operational during 1999 with a third (Steel Dynamics,

Inc.) expected to become operational in 2002. On the other hand, another domestic firm

(Northwestern Steel & Wire Company) completely shut down its operations in May 2001.

                i. Subject import volumes.

        In a material injury investigation, the statute requires the Commission to determine

whether a domestic industry “(i) is materially injured, or (ii) is threatened with material injury . . .

by reason of imports.” 19 U.S.C. § 1673d(b)(1). The statute defines “material injury” as “harm

        12
          These domestic producers, Nucor-Yamato and TXI, together produced approximately
[[ ]] of domestic structural steel beams in 2001. Staff Report at III-2. The Staff Report further
pointed out that Nucor denied putting its Berkeley plant customers on “allocation” and that a
Northwestern Steel & Wire Company witness testified that this domestic producer, which
eventually went out of business, “was begging for orders” during this time. Staff Report at II-2
n.3.
        13
           Another piece of evidence supporting the existence of domestic shortage during the
POI is the observation that the “average lead time” for domestic producers’ delivery increased in
2000 from its 1999 level. Staff Report at II-2 n.4; Final Determination at 18. The court
additionally notes that counsel for Fair Beam all but conceded the presence of a supply shortage
at oral argument before this court. Oral Arg. Tr. at 9:16-17 (“there was clearly a shortage”).
Ct. No. 02-00531                                                                        Page 8

which is not inconsequential, immaterial, or unimportant.” § 1677(7)(A). In making a material

injury determination, the statute first requires the ITC to consider the “volume” of subject

imports already determined to be sold at less-than-fair value. § 1677(7)(B)(i)(I). In particular,

the ITC shall consider whether the volume of subject imports (or any change therein) in either

absolute or relative terms is “significant” during the POI. § 1677(7)(C)(i).

        In the Final Determination, the ITC observed that the volume of subject imports rose

from 331,436 short tons in 1999 to 772,809 in 2000, and then fell to 300,150 in 2001 (to a level

lower than its 1999 level). Final Determination at 21. The value (as opposed to quantity) of

subject imports followed a similar curve. These numbers represented a market penetration by

subject imports of 6.7% in 1999, 12.4% in 2000, and 6.2% in 2001. The ITC linked the rise in

U.S. market penetration of subject imports to its finding that the domestic industry was

experiencing supply difficulties. Accounting for the gap in time between order placement and

delivery, the ITC noted that changes in volume of subject imports trailed the domestic supply

conditions, with the domestic shortage and its subsequent alleviation responsible for the rise and

in part for the later fall of subject imports during the POI. Id. at 23.

        Before the ITC, the domestic industry had argued that the increase in demand during 2000

was “relatively modest,” and therefore the domestic industry could satisfy “real” demand with

their supplies – which argument was an attempt to dispute the domestic shortage finding of the

ITC. The ITC responded by noting that instead of contemporaneous demand conditions,

perceptions about future demand are what stimulate orders. Id. at 22. As evidence of

purchasers’ expectations of strong future demand during the POI, the ITC cited testimony by one
Ct. No. 02-00531                                                                             Page 9

fabricator and the predictions of a trade publication, which incidentally also reported “major

concerns about steel availability.” Id. at 22-23. In the ITC’s scenario of events, expected strong

demand and limited domestic supply led to an increase in purchases of subject imports

(especially by distributors). The ITC further acknowledged that by the third quarter of 2000, the

domestic supply situation improved and, after import volumes had reached their peak in August

2000, orders for subject imports began to fall. Id. at 23.

          Further, the ITC remarked that subject import volumes started to fall “well before” the

filing of the May 2001 petition that initiated the present investigation. Id. at 23-24. Consistent

with this observation, the ITC pronounced that the filing of the petition had “limited” impact on

the decline of subject import volumes in 2001 and, accordingly, the ITC did not “reduce the

weight” accorded to the 2001 data. The ITC finally concluded that resolution of domestic

shortages coupled with decline in demand led to a decline in subject import quantities in this

period.

          After thus accounting both for the upward movement of subject import volumes from

1999 to 2000 and their decline from 2000 to 2001, the ITC went on to say: “[I]n light of the

foregoing conditions of competition and the lack of price effects discussed below, we find that

the volume of subject imports is not significant.” Id. at 24.

                 ii. Price effects.

          The statute also requires the ITC to consider the “effect of imports . . . on prices in the

United States for domestic like products.” § 1677(7)(B)(i)(II). In particular, the ITC is required

to analyze whether “there has been significant price underselling” of imports compared with
Ct. No. 02-00531                                                                          Page 10

domestic products and whether “the effect of imports . . . otherwise depresses prices to a

significant degree or prevents price increases, which otherwise would have occurred, to a

significant degree.” § 1677(7)(C)(ii)(I) & (II).

       Comparing domestic prices with subject import prices, the ITC first found that prices of

subject imports reflected “a mixed pattern of overselling and underselling” the domestic product

during the POI. Final Determination at 25. In particular, subject imports undersold the domestic

product in 90 of 147 quarterly comparisons. Id.; Staff Report at V-17 & V-18. The ITC noted

that product 1, a type of structural steel beams (wide-flange beams of 8 to 14 inches),

experienced the “most intense” competition because it was the most widely sold and additionally

had the most complete pricing data from the subject countries. Final Determination at 26.

Isolating the price information for this product, the ITC observed that prices of product 1

exhibited 22 occasions of underselling and 32 occasions of overselling. To estimate underselling

more accurately, the ITC also conducted a second comparison which incorporated the differing

delivery times of subject imports and domestic product. In this comparison, the incidence of

underselling for product 1 increased to 27 and that of overselling decreased to 25. Even though

in this instance underselling occurred more frequently than overselling, the ITC nevertheless

emphasized that “still more tonnage was oversold.”14 Id. at 26 n.100; Staff Report at V-9 & V-

10.

       While also acknowledging that other products under investigation exhibited greater

       14
           Despite the domestic industry’s objections, the ITC used actual sale prices rather than
list prices in comparisons because this method was the Commission’s customary practice and
because the record established that domestic producers on occasion deviated from list prices.
Final Determination at 26 n.100 (citing Fair Beam’s Prehearing Brief before the agency).
Ct. No. 02-00531                                                                         Page 11

incidence of underselling, the ITC noted that the domestic product was typically sold at a

premium, the existence of which was established at the administrative hearing by testimony of

four domestic industry witnesses (also characterizing the premium of $10 to $40 per ton as

“small”) and one respondents witness (adding that the premium could more than double in a

“very weak market”).15 Final Determination at 25 n.98; ITC Hearing Tr. at 232. The ITC

attributed the more frequent occurrence of underselling (as opposed to overselling) to the

premium. The ITC additionally observed that subject imports continued to increase even though

some subject import prices were higher than domestic price levels. Final Determination at 27.

The ITC concluded that “[t]hese factors all serve to diminish the significance of the underselling

that was observed.” Id.

       Next, the ITC noted that in 2000 the volume of imports was at its highest level when both

domestic and subject import prices were highest. Prices of subject imports sharply rose from

1999 to their peak in 2000 and declined in 2001, following a trend similar to that of subject

import volumes. Id.; Staff Report at V-9 to V-16. The ITC thus pronounced that “factors other

than competition from subject imports were responsible for price movement of the domestically

produced product.” Final Determination at 27. In identifying domestic shortages as the likely

culprit, the ITC observed that “[p]rice increases are a natural function of supply shortages.” Id. at

28.

       The ITC further noted that once the domestic supply shortage was alleviated, prices along

       15
          The premium is due to some non-price considerations, such as domestic producers’
geographical proximity. See ITC Hearing Tr. at 200. Testimony was also presented to the effect
that the premium was exacerbated in recent years due to strong dollar. See id. at 204.
Ct. No. 02-00531                                                                        Page 12

with subject imports declined. According to the ITC, “the sharp decline in prices observed

during 2001 cannot be a function of that year’s subject import volumes, which declined sharply,

[and it] also cannot be a function of subject imports entering the U.S. market in 2000 at rising

prices that were sometimes above those for the domestically produced product.” Id. The reason

for the fall in price, the ITC determined, was the misestimation of the 2001 demand (which in

fact declined from its 2000 level) by purchasers who placed their orders earlier and the

consequential rise in distributors’ inventories – which can also be termed as an “oversupply” in

the market.16 Id. at 28-29.

       The ITC ended its price effects analysis by stating that:

                We cannot conclude that the record indicates that either the inventory
       overhang or the resulting price declines were the function of the subject imports.
       High and increasing subject import prices during the portion of 2000 when subject
       import volumes increased cannot explain subsequent price declines. Nor, in light
       of the subject import pricing and volume patterns, can there be any nexus between
       the subject imports and business decisions by steel service centers to increase
       purchases that proved, in retrospect, to be wrong. We consequently conclude that
       the subject imports did not have significant price-depressing or -suppressing
       effects.

Id. at 29-30.

                iii. Impact.

       The last component of a material injury determination is the analysis of the impact of

       16
          Fair Beam submitted to the ITC the conclusions of an econometric model which
predicted that subject imports affected prices with a nine month lag. See Final Determination at
29 n.107. The ITC found that the model failed because it did not take into account changes in
domestic supply capabilities. To rebut the predictions of the model the ITC cited testimony from
industry players to the effect that price competition occurs when an order is placed.
Ct. No. 02-00531                                                                            Page 13

subject imports sold at less-than-fair value on the domestic industry.17 The ITC is statutorily

required to consider “all relevant economic factors” that bear on “the business cycle and

conditions of competition” in the industry, including changes in output, sales, inventories,

capacity utilization, market share, employment, wages, productivity, profits, cash flow, return on

investment, ability to raise capital, and R&D. § 1677(7)(C)(iii). In addition, the 1994

amendments to the statute now require the ITC to consider the size of dumping margins

determined in an anti-dumping investigation.18 § 1677(7)(C)(iii)(V); The Uruguay Round

Agreements Act, Statement of Administrative Action (“SAA”) at 850, reprinted in 1994

U.S.C.C.A.N. at 4040, 4184. No single factor is dispositive. See § 1677(7)(E)(ii) (“The

presence or absence of any factor which the Commission is required to evaluate under

subparagraph (C) . . . shall not necessarily give decisive guidance” to a material injury

determination).

       In the Final Determination, the ITC observed that apparent U.S. consumption of

structural steel beams, domestic output indicators (such as capacity, capacity utilization,

production, and U.S. shipments), domestic sales revenues (including per unit sales values, the

domestic industry’s operating income and margins), employment indicators (such as number of

workers, productivity, hours worked, and wages paid) – all followed a pattern of increase from

       17
          Besides volume, price, and impact, the ITC “may [also] consider such other economic
factors as are relevant to the determination regarding whether there is material injury by reason of
imports.” § 1677(7)(B)(ii).
       18
         Here, the ITC’s consideration of dumping margins was limited to a listing of amended
dumping margins for companies in subject countries. Final Determination at 30 n.110. The
Final Determination’s consideration of dumping margins is, however, not on review before the
court because it was not raised.
Ct. No. 02-00531                                                                          Page 14

1999 to 2000 and decline from 2000 to 2001. Final Determination at 31-34; Staff Report at VI-

2. In contrast, the ITC found that domestic producers’ inventories, hourly wages, and R&D

steadily increased, and industry capital expenditures decreased from 1999 to 2001. More

significantly, the ITC determined that the domestic industry’s market share (as measured by

domestic output’s share in U.S. consumption), despite a “modest” decline in 2000, was actually

higher in 2001 than it was in 1999 (specifically, 81.1% in 1999, 79.8% in 2000, and 90.3% in

2001). Final Determination at 31-32. Thus, the ITC dubbed the 2000 loss of market share by

the domestic industry a “temporary phenomenon.” Id. at 32.

       The ITC concluded that domestic industry’s overall performance improved from 1999 to

2000, when imports were at their peak, and that none of the components that led to decline in

performance from 2000 to 2001 were a result of the increase in imports. Id. at 33. The ITC

attributed the decline in prices of the 2000-2001 period to increasing supply and declining

demand for this period. Accordingly, the ITC determined that “the subject imports did not have a

significant adverse impact on the domestic structural steel beams industry.” Id. at 34.

               iv. Threat of material injury.

       The statute also protects the domestic industry from a threat of material injury (as

opposed to a present material injury) on account of imports sold at less-than-fair value in the U.S.

market. To be able to conclude that the domestic industry is thus threatened, the ITC must find

whether “further dumped or subsidized imports are imminent and whether material injury by

reason of imports would occur unless an order is issued.” § 1677(7)(F)(ii). The ITC is required

to evaluate the threat factors outlined in section 1677(7)(F)(i).
Ct. No. 02-00531                                                                        Page 15

       In the Final Determination, the ITC first looked at subject import volume and market

penetration, emphasizing that, even though increasing in the beginning of the POI, both variables

exhibited a sharp decline at the end of the POI. Final Determination at 36. The ITC found “no

current shortages of domestic supply and no likelihood of shortages in the imminent future.” Id.

In connection with this finding, the ITC stressed that TXI had solved its problems at its

Petersburg mill and a new Steel Dynamics, Inc. mill was in the works. Further, although the

subject countries projected an increase in imports in both 2002 and 2003, the projections fell

short of their peak in 2000. Id. at 37. The subject countries had ready markets at home and

abroad, and that, although there was some “ability to shift exports from other markets to the

United States,” it was “unlikely that subject imports [would] increase to significant levels,” given

the decline in subject imports in 2001.19 Id. Capacity utilization in the subject countries

persisted at high levels during the POI, and further increases in both capacity and capacity

utilization were anticipated in 2002 and 2003; the ITC thus found that there was no indication in

the record of an “imminent” increase in subject volumes. Moreover, subject countries presented

testimony (by one of their executives) rebutting the contention that an impending increase in

subject imports was likely. Id. at 38 n.142; ITC Hearing Tr. at 201-202.

       The ITC additionally pointed to the lack of any significant price effects in the POI and

predicted that such would continue in the imminent future. Final Determination at 38. With

respect to subject countries’ inventories, the ITC observed that despite an increase in inventories,

not all of the inventoried beams were suitable for sale in the United States because they did not

       19
        Here, the ITC noted outstanding antidumping duty orders against Russia by Korea and
Taiwan and against South Africa by Australia. See Final Determination at 37 n.141.
Ct. No. 02-00531                                                                             Page 16

conform to the U.S. standard. Moreover, even though other products which could be substituted

for structural steel beams in production were subject to U.S. safeguards tariffs (as in the case of

hot-rolled bar) – with the implication that more structural steel beams could be produced –, the

ITC maintained that “[n]evertheless, as previously noted, we do not believe that the presence or

potential for additional productive capacity in the subject countries is likely to lead to

substantially increased imports.” Id. at 39.

       Finally, the ITC decided that the domestic industry was not in a “vulnerable state”

because the industry remained “profitable overall” despite variable performances of individual

producers and was also “characterized by the recent and imminent expansion of capacity at new

and efficient production facilities.” Id. The ITC concluded:

       Accordingly, we find that material injury by reason of subject imports will not
       occur absent issuance of antidumping orders against the subject imports. We
       therefore conclude that the domestic structural steel beams industry is not
       threatened with material injury by reason of the subject imports.

Id.

                                          III. DISCUSSION

       The court must uphold the Commission’s determinations unless they are unsupported by

substantial evidence on the record, or otherwise not in accordance with law. 19 U.S.C. §

1516a(b)(1)(B)(i). Substantial evidence is “such relevant evidence as a reasonable mind might

accept as adequate to support a conclusion.” Consol. Edison Co. of New York v. NLRB, 305 U.S.

197, 229 (1938).
Ct. No. 02-00531                                                                         Page 17

A. THE ITC IS UNDER NO OBLIGATION TO FOLLOW ITS PR IOR FACTUAL DETERMINATIONS IN
SUBSEQUENT INVESTIGATIONS .

Parties’ arguments.

       Fair Beam charges that determinations made in the Final Determination (which Fair

Beam denotes as Beams II) are “factually and logically inconsistent with the underlying record”

and also with an earlier ITC decision, Certain Structural Steel Beams from Japan, Inv. No. 731-

TA-853 (Final), USITC Pub. No. 3308 (June 2000) (“Beams I”) in Pls.’ App. tab 3. See Pls.’ Br.

at 8. In Beams I, the ITC found that the domestic industry was materially injured or threatened

with material injury by reason of structural steel beams imported from Japan.20 Beams I at 3.

Fair Beam makes this argument by focusing on the language found in a recent United States

Court of International Trade case, Usinor v. United States, Slip Op. 02-70 (July 19, 2002)

(“Usinor”). The Usinor court, while acknowledging that “each injury or investigation is sui

generis, involving a unique combination and interaction of many economic variables,”

emphasized that the ITC “may not disregard previous findings of a general nature that bear

directly upon the current review.” Usinor at 39 (quotation omitted). In Usinor, the issue was

whether the ITC can assert in one case that the countries in the European Union (“EU”) were

“export oriented,” poised to export to the United States, after having found in an earlier case that

the primary marketing focus of one European country was the European market. Id. at 38-39.

       20
          This determination was subsequently adopted with respect to Korea by virtue of almost
identical administrative records in both cases. See Certain Structural Steel Beams from Korea,
Invs. Nos. 701-TA-401 and 731-TA-854 (Final), USITC Pub. No. 3326 (August 2000). In
Beams I material injury and threat of material injury determinations were not unanimous, with
three Commissioners finding material injury and the other three finding threat of material injury.
Ct. No. 02-00531                                                                        Page 18

According to Usinor, the “observations regarding EU markets [were] general in nature and [did]

not depend on the specific products at issue.” Id. at 39-40. The Usinor court accordingly

ordered the ITC to sufficiently explain its contradictory positions. Basing its argument on

Usinor, Fair Beam contends that observations on “general market dynamics” are sufficiently “of

a general nature.” Pls.’ Br. at 9. Fair Beam adds that “Beams I and Beams II involved the same

product, the same domestic producers, the same volume trends, the same manifestation of injury,

in overlapping periods of investigation.” Id.

         On the other hand, the ITC emphasizes the sui generis nature of injury investigations.

See Def.’s Br. at 8. ITC cites prior cases of this Court which rejected the argument, among

others, that the ITC was required to use the same volume and price analysis in subsequent

investigations for the same product. See id. at 9 (citation omitted). The ITC stresses the

difference between “agency practice,” which would have precedential value, and case-specific

determinations, which would not. See id. at 10 (citing Ranchers-Cattlemen Action Legal

Foundation v. United States, 23 CIT 861, 884-85, 74 F. Supp. 2d 1353, 1374 (1999)). The ITC

concludes that because Beams I or Beams II’s factual determinations are not “of a general nature”

under Usinor, but based on specific facts, Beams II need not have followed Beams I. See id. at

10-11.

         The ITC argues in the alternative that even assuming such factual determinations are “of a

general nature,” the “ITC acts in accordance with law when it either follows or distinguishes such

determinations.” Id. at 11 (citation omitted). The ITC points to footnote 105 in Beams II, where

the Commissioners rejected the argument that Beams I would have any precedential bearing on
Ct. No. 02-00531                                                                           Page 19

the present investigation and further indicated that, in any event, the two investigations were

factually different. For the ITC, footnote 105 serves to distinguish the Beams II investigation

from the Beams I investigation sufficiently.

        The arguments of Defendant-Intervenors Stahlwerk Thuringen Gmbh et al. (“Stahlwerk”)

and Salzgitter AG Stahl und Technologie (“Salzgitter”) center on the rejection of Fair Beam’s

Usinor analysis. Specifically, Stahlwerk argues that the determinations of Beams II concerning

volume, price, and impact are not “of a general nature,” but fact-specific. See Stahlwerk’s Br. at

7-8. Stahlwerk presents a doomsday scenario in which, were the court to agree with Fair Beam,

the ITC would subsequently be required to consider “hundreds” of its prior determinations in

every investigation in search of consistency. Id. at 9.

        Salzgitter adds that the Usinor court clearly adhered to the familiar standard of substantial

evidence and that the plaintiff in Usinor was challenging the ITC’s construction of a statute, not

fact findings.21 See Salzgitter Br. at 6.

Comparative Analysis of Beams I and the Final Determination (or Beams II).

        An agency that engages in formal adjudication may not render arbitrary and inconsistent

decisions. See Greater Boston Television Corp. v. FCC, 444 F.2d 841, 852 (D.C. Cir. 1970),

cert. denied, 403 U.S. 923 (1971); Chisholm v. Defense Logistics Agency, 656 F.2d 42, 47 (3d

Cir. 1981). Should the agency choose to deviate from a practice it consistently employed in the

past for the evaluation and testing of a set of facts, it must delineate and give reasons for its

        21
         The court questions this argument. It can find no indication in Usinor that the Usinor
court was engaged in statutory construction with respect to the “export oriented” nature of the
EU.
Ct. No. 02-00531                                                                          Page 20

subsequent change of policy as to provide adequate guidance to parties affected by its actions and

to present the reviewing court with a discernable basis to judge the discrepancy. See Sec’y of

Agriculture v. United States, 347 U.S. 645, 652-53 (1954); British Steel PLC v. United States,

127 F.3d 1471, 1475 (Fed. Cir. 1997).

       At the same time, it is an equally well-established proposition that the ITC’s material

injury determinations are sui generis; that is, the agency’s findings and determinations are

necessarily confined to a specific period of investigation with its attendant, peculiar set of

circumstances. See U.S. Steel Group v. United States, 18 CIT 1190, 1213, 873 F. Supp. 673, 695

(1994) (quotation omitted). In Beams I, the period of investigation was from 1997 to 1999; in

Beams II, from 1999 to 2001. Given the dynamic nature of the economy, rarely would

circumstances and their multi-faceted interactions defining a period of material injury

investigation exhibit sufficient similarity to those of another period.

       Fair Beam is correct in that Beams I and II involved the same product, and subject

imports were present in the U.S. market at noticeable and increasing levels in both periods of

investigation. Yet the statute dictates the ITC to attach importance only to those increases in

subject import quantities and to those price effects of the subject imports which are deemed

“significant.” § 1677(7)(C)(i) & (ii). Accordingly, the ITC first acknowledged in footnote 105

of the Final Determination that subject imports in Beams I “were entering the U.S. market at low

and declining prices even after a period when the domestic industry was having difficulty

satisfying demand.”22 Final Determination at 28 n.105. In contrast, a finding was made in the

       22
          The ITC in Beams I made a finding of supply shortage in the U.S. market in the fourth
quarter of 1997 and the first two quarters of 1998. Beams I at 10. The ITC further observed that
Ct. No. 02-00531                                                                         Page 21

Beams II investigation that both subject import volumes and prices were increasing during the

first portion of the POI.

       Second, the ITC further noted in the Final Determination that “the peak subject import

volume and the increase in subject import volume in [Beams I were] substantially greater than in

[Beams II].” Id. As a third observation, the ITC offered that in Beams I “the subject imports

undersold the domestic like product in the vast majority of pricing comparisons.” Id. (emphasis

supplied). In Beams II, on the other hand, under- and overselling were approximately of equal

frequency for product 1, the most widely traded product among structural steel beams and, even

though more underselling than overselling occurred for other products, underselling was

mitigated by the price premium. The ITC finally concluded in the Final Determination that “[a]s

the accompanying discussion indicates, the record in these investigations is substantially

different.” Id.

       The court agrees with the ITC that these three observations are of crucial importance to

distinguish the underlying factual pattern of Beams II from that of Beams I. In a material injury

determination, the ITC is required to determine whether a material injury to the domestic

industry (or a threat thereof) occurred “by reason of” subject imports that are sold in the U.S.

market at less-than-fair value. § 1671d(b)(1). That is, the record must support a sufficient nexus

between the injury (or threat of injury) and subject imports. See Goss Graphics Sys. v. United

supply shortage “quickly reversed as subject imports escalated in March 1998 and surged
thereafter through the first quarter of 1999,” that “[t]he import surge far exceeded the prior
shortfall in supply,” and that “imports gained market share at the expense of the domestic
industry.” Id. at 11. Fair Beam represents that thereby the ITC in Beams I compared the size of
the domestic shortage to the increase in subject imports.
Ct. No. 02-00531                                                                        Page 22

States, 22 CIT 983, 989-90, 33 F. Supp. 2d 1082, 1089 (1998). Moreover, “evidence of de

minimis (e.g., minimal or tangential) causation of injury does not reach the causation level

required under the statute.” Gerald Metals, Inc. v. United States, 132 F.3d 716, 722 (Fed. Cir.

1997), quoted in Coalition for the Preservation of Am. Brake Drum and Rotor Aftermarket Mfrs.

v. United States, 22 CIT 520, 523, 15 F. Supp. 2d 918, 922 (1998). In the Final Determination

here, the ITC was unpersuaded by the argument that aggressive price cutting by the subject

countries was what allowed subject imports to penetrate the U.S. market and subsequently cause

injury to the domestic industry. Instead, the ITC attributed the rise in subject import volumes to

a temporary domestic supply shortage observed during this period.

       The ITC based its finding of domestic supply shortage on three separate pieces of

evidence: questionnaire responses of purchasers and of domestic producers, and

contemporaneous news articles in industry publications. The ITC noted that “[p]rice increases

are a natural function of supply shortages.” Final Determination at 28. The ITC further

observed that subject import volumes were increasing alongside prices. According to the ITC,

the rise in both the subject imports and prices was thus a consequence of the domestic supply

shortage.

       In Beams II, the domestic industry was temporarily unable to satisfy demand.23 The

domestic producers’ inability to satisfy demand resulted in a supply shortage or an excess

demand in the market. As purchasers competed for fewer available products, prices rose. In

       23
         The domestic supply shortage may have been partially due to the exit of Japanese and
Korean beams from the U.S. market, as the ITC implied, or to a positive shift in demand or to
some other cause not easily discernable from the record. In any event, the “cause” of the
domestic shortage is not relevant to the disposition of this case.
Ct. No. 02-00531                                                                           Page 23

addition, the supply of the domestic industry was relatively more inelastic than the supply of the

subject countries vis a vis the U.S. market. See Staff Report at II-16 & II-17. That is, subject

producers could react to a rise in U.S. prices faster than their domestic counterparts in terms of

increasing shipment to the U.S. market. As the subject countries diverted their goods to the U.S.

market to satisfy excess demand, subject import quantities began to rise and, as expected, this

phenomenon was observed alongside an increase in prices.24 Accordingly, the domestic shortage

was, more likely than not, responsible for the rise in both subject import volumes and prices.

        In Beams I, however, prices were declining as the subject import volumes were

increasing. In addition, the ITC found significantly more underselling than overselling the

domestic product by subject imports. These two observations serve to show that in Beams I a

more immediate connection could have been made between subject imports and falling prices.

That is, it was likely that persistent price cutting by foreign exporters had led to the increase in

subject import volumes by spurring purchases of imports over the domestic product where a

domestic supply shortage by itself would have resulted in an increase in price. Accordingly, in

Beams I the finding of domestic shortage was not as significant as in the Final Determination

here.

        As urged by the ITC, this court also notes that in Beams I “[n]othwithstanding the

        24
          The court notes that in the absence of subject imports the price rise may have been
higher. Not explicitly discussing this possibility, the ITC nevertheless found that the price effects
were not significant. It should also be noted that non-subject imports (other than Japanese and
Korean beams which left the market due to the antidumping order) also increased from 1999 to
2000. See Final Determination at 23 n.89; Staff Report at IV-6 & n.8. This fact further
undermines the contention that price cutting by subject countries caused the volumes of subject
imports to rise.
Ct. No. 02-00531                                                                         Page 24

decrease from 1998 levels, the 1999 volume of subject imports represent[ed] a 728-percent

increase over the 1997 volume.” Beams I at 12. In contrast, the volume of subject imports in

Beams II showed a net decline over the POI. As a parallel observation, the domestic industry

gained market share over the POI in Beams II (despite the dip in 2000) and lost market share in

Beams I. This distinction between Beams I and II lends credence to the assertion that in Beams I

subject imports penetrated the market in numbers which went beyond a temporary exploitation of

a domestic shortage whereas in Beams II the rise in subject import volumes was a “temporary

phenomenon.” The court finally observes that subject countries in the two investigations were

different, a factor which plays an especially important role in a threat determination. As a result,

the court finds (as did the ITC) that Beams I does not constitute legal precedent for Beams II and

the ITC’s consideration of Beams I in footnote 105 of the Final Determination is sufficient to

distinguish the two investigations factually. 25

        In addition, the court rejects Fair Beam’s argument that Beams II’s factual findings

concerning “general market dynamics” are “of a general nature” under Usinor. The “general

market dynamics” Fair Beam refers to is presumably the statutory framework the ITC is required

        25
           Fair Beam claims that the Final Determination should have addressed Beams I more
extensively, beyond a mere footnote. The ITC responds that Beams II did not have to distinguish
Beams I at all and, assuming that it did, footnote 105 in Beams II constitutes an adequate
consideration of Beams I. The court observes that because Fair Beam raised Beams I as an
“underlying theme” of its arguments before the agency, the ITC was correct in addressing Beams
I in footnote 105. Final Determination at 28 n.105; Altx, Inc. v. United States, 25 CIT __, __,
167 F. Supp. 2d 1353, 1374 (2001) (the agency “must address significant arguments and
evidence which seriously undermines its reasoning and conclusions”). In footnote 105, the ITC
first pointed out that Fair Beam’s Beams I argument called for no “response” as a “legal matter”
and, to the extent the argument had merit as a “factual matter,” the ITC sufficiently addressed the
crucial distinctions between Beams I and II in concluding that the two investigations had
substantially different records.
Ct. No. 02-00531                                                                             Page 25

to follow in every material injury determination. There is nothing in the statute or case law that

requires the ITC to take as precedent any prior factual finding that was reached within this

framework. In Usinor, the finding “of a general nature” pertained to a particular attitude toward

the market of subject producers in question. Specifically, the Usinor court said that the ITC

cannot reasonably claim that European countries are not export-oriented in one case and later

retract that position without explanation. While Usinor correctly supports the need for

consistency in the ITC’s determinations, as well as the need for reasoned explanation, this court

observes that there is no finding in Beams II that is likely to be governed by Usinor. The

findings in Beams II are confined to observations on economic variables, which are necessarily

volatile. Fair Beam does not point to any determination in Beams II (or in Beams I) that bears on

particular, persistent attitudes of trading countries which, because they persist within a

sufficiently short interval of time, would arguably have called for the same treatment by the ITC

in different investigations undertaken also close in time. In addition, the fact that similar patterns

are observed in different investigations with regard to some of the variables does not preclude a

different interpretation of the patterns after viewing the entire economic environment as a whole.

In fact, the statute requires the ITC to evaluate patterns in a context, instead of encouraging an

analysis of each piece in isolation.

B. THE ITC’S FINDING REGARDING THE SIGNIFICANCE OF SUBJECT IMPORT VOLUME IS
SUPPORTED BY SUBSTANTIAL EVIDENCE AND IS OTHERWISE IN ACCORDANCE WITH LAW .

Parties’ arguments.

       Fair Beam next argues that the Final Determination’s findings are unsupported by

substantial evidence. Fair Beam continues to compare the Final Determination to Beams I in this
Ct. No. 02-00531                                                                         Page 26

portion of its arguments before the court, specifically with respect to similar volume trends found

in the two investigations. See Pls.’ Br. at 11. In addition, Fair Beam contends that the Final

Determination should have compared the size of the domestic shortage with the size of the

increase in subject import volumes as Beams I did. Id. at 12. That subject import volumes

exceeded the domestic shortage may have meant that the surge in subject imports was not solely

due to the domestic supply shortage.

       Fair Beam also maintains that the Final Determination should have taken into account the

impact of the filing of the petition on subject import volumes. See id. at 13. Fair Beam argues

that the decrease in subject imports in the later part of the POI may have been in part due to the

petition. Fair Beam points out that [[               ]] importer withdrew from the market upon

the filing of the petition. See id. at 14 (citing Fax from TradeARBED to its customers (dated

June 7, 2001) in Pls.’ App. tab 8 (“As is normal while under [an] investigation we are

withdrawing from the market effective immediately.”)).26

       The ITC counters that, even if there was a sharp increase in subject import volumes, the

statute requires the ITC to concentrate on the significance of such increase. See Def.’s Br. at 12.

The ITC also contends that the Final Determination was correct in not discounting post-petition

data because the decrease in subject import volumes preceded the filing of the petition. See id. at

13. Moreover, the Commissioners did not completely ignore the petition, but decided that it had

       26
           At the administrative hearing an ARBED executive elaborated, “we never completely
withdrew from the market.” ITC Hearing Tr. at 199. The ITC appears not to have considered
the letter as evidence in its determination on post-petition data. However, consistent with the
court’s evaluation of contradictory evidence under the substantial evidence standard, the court
defers to the ITC’s treatment of the letter in the Final Determination.
Ct. No. 02-00531                                                                          Page 27

a “limited” impact. Id.

Subject import volume analysis.

       There is substantial evidence on the record to support the ITC’s finding that the volume

of subject imports was not “significant.” First, as noted earlier, there is substantial evidence in

the record to support the existence of a domestic supply shortage in the U.S. structural steel

beams market. Second, there is substantial evidence in the record to support the ITC’s analysis

of relationships among economic variables during the POI. Consulting data on both the subject

import volumes and supply conditions, the ITC noted that the subject import quantities followed

(with a temporal lag) the domestic supply conditions. Subject imports started to increase in

response to the domestic supply shortage in 1999 and declined between 2000 and 2001 when the

shortage was shrinking. Moreover, the ITC observed that in the beginning of the POI, purchasers

overestimated future demand for structural steel beams, and towards the end of the POI, demand

either declined or flattened with contraction in economic activity and construction. The ITC

pointed to specific sources of information and evidence in support of these findings in the form

of testimony, published articles, and statistics.

       On the other hand, Fair Beam can point to no evidence in support of its argument that the

rise in the subject import volumes was “significant.” Fair Beam continues to engage in what this

court considers a fruitless comparison between Beams I and the Final Determination. In addition

to what has been explored above, the court notes that, even though the subject import volumes

rose and fell (thus demonstrated a similar pattern) in both periods of investigation, the market

penetration by subject imports in the Final Determination was far from its magnitude in Beams I.
Ct. No. 02-00531                                                                         Page 28

       Fair Beam is additionally concerned that the relative sizes of the domestic shortage and

subject import volumes should have been noted in the Final Determination as they had been in

Beams I. However, there is nothing in the statute or case law which requires the ITC to compare

the size of a shortage, the existence of which has been confirmed, with the increase in subject

import volumes. The statute solely mandates the ITC to consider the volume of subject imports

and assess its significance. See §§ 1677(7)(B) & (C). Because the precise course this analysis

should take is not specified, the court must defer to reasonable and factually supported

applications of the ITC’s methods. Usinor at 6-7 (“we affirm the agency’s factual determinations

so long as they are reasonable and supported by the record as a whole, even if there is some

evidence that detracts from the agency’s conclusions”) (citing Olympia Indus., Inc. v. United

States, 22 CIT 387, 389, 7 F. Supp. 2d 997, 1000 (1998)); BIC Corp. v. United States, 21 CIT

448, 462, 964 F. Supp. 391, 404 (1997) (“because Congress has granted the Commission broad

discretion to choose its methodology, [the court] will not disturb the Commission’s choice unless

it is unreasonable”) (citation omitted).

       The court further observes that, as noted above, the Beams I decision is not legally

binding on the ITC in subsequent investigations and, therefore, does not serve as a framework for

subsequent ITC determinations as far as the size of a domestic shortage or any other factual

determination is concerned. Quite the contrary, Beams I and the Final Determination possess

sufficient factual differences the most important of which (for our purposes here) is the fact that

in Beams I the subject imports continued to persist in the U.S. market far above their levels in the

beginning of the period. Had the increase in subject imports in Beams I been due to a domestic
Ct. No. 02-00531                                                                         Page 29

shortage then present, the subsequent decline in volumes when the shortage disappeared would

have been expected to mirror the increase in approximate magnitude. More importantly, to the

extent the ITC in the Final Determination attributed the rise in subject import volumes to the

domestic shortage, the Commissioners properly evaluated and observed the two variables

together in finding that they followed a similar curve with a lag.

       Finally, as urged by the ITC, the statute gives it discretion to reduce the weight it accords

to post-petition data. See § 1677(7)(I). That is, the ITC “may” discount such data, with the

implication that, where proper, it need not. Id. Here, the ITC observed that the decline in subject

import volumes preceded the filing of the petition by a sufficient interval. Therefore, the ITC

decided that the petition had a “limited” impact on the fall in subject import volumes at the end

of the POI. Instead of the mere filing of the petition, the ITC determined that the alleviation of

domestic supply shortage coupled with weak demand in this period contributed to the decrease in

subject import volumes. The ITC’s treatment of post-petition data was accordingly reasonable

and supported by the record.

C. THE ITC’S DETERMINATION THAT THERE W ERE NO ADVERSE PRICE EFFECTS IS
SUPPORTED BY SUBSTANTIAL EVIDENCE AND IS OTHERWISE IN ACCORDANCE WITH LAW .

Parties’ arguments.

       Fair Beam next challenges the ITC’s determination that the prices of structural steel

beams were not suppressed by subject imports. See Pls.’ Br. at 17. In particular, Fair Beam

takes issue with the Final Determination which found (i) that underselling was not widespread,

(ii) that underselling was mitigated by the premium the domestic product fetches in the market,

and (iii) that there was more overselling than underselling with respect to product 1. Fair Beam
Ct. No. 02-00531                                                                          Page 30

quotes another ITC material injury determination where the ITC observed that “in a commodity

market characterized by intense price-based competition, a mixed pattern of under- and

overselling is to be expected; such a pattern, together with increasing volume of subject imports,

indicates that subject imports played a substantial role in the price declines in this market.”

Certain Stainless Steel Plate from Belgium, Canada, Italy, Korea, South Africa, and Taiwan,

USITC Pub. No. 3188 (May 1999) at 19. Fair Beam maintains that when price comparisons

were adjusted by lag time, there was more underselling than overselling for product 1 and that

the data from 2000 shows “high margins” of underselling. Pls.’ Br. at 16. Fair Beam next

questions the ITC’s finding of lack of causation between the increase in the volume of subject

imports and the subsequent price declines. Id. at 17. Fair Beam emphasizes that a “price war”

resulted from the entry of subject imports to the U.S. market, which, it claims, was ignored by the

ITC. Id. at 18. Consistent with its “price war” theory, Fair Beam also rejects the ITC’s

observation that because the peak in import volumes coincided with the peak in prices, the

increase in both was due to a shortage in domestically supplied steel beam. For Fair Beam, this

observation ignores the delayed price effects of subject imports “due to the build-up of

inventories.” Id. at 19. Fair Beam argues that “subject imports triggered a buying spree by

service centers, which led to large inventory build-ups, and which ultimately caused a domestic

price collapse.” Id. at 20.

       The ITC first argues that the ITC thoroughly considered the record data of underselling.

See Def.’s Br. at 16. The ITC provides numbers in support of its position that “large quantities”

of beams were oversold at “substantial margins,” even in 2000. Id. at 18. The ITC urges that
Ct. No. 02-00531                                                                          Page 31

under- and overselling data should be evaluated in context. In particular, the ITC emphasizes

that a price war, if any, did not start until the third quarter of 2000, well into the POI. The ITC

cites case law to show that “the ITC need not find underselling significant merely because there

are more instances of underselling than overselling.” Id. (citations omitted). The ITC further

points out that in Timken Co. v. United States, the Court upheld the ITC’s conclusion that the

price premium for the domestic product mitigated the significance of underselling. 20 CIT 76,

87-88, 913 F. Supp. 580, 590 (1996).

Price effects analysis.

       The court finds that the ITC’s negative determination with respect to the significance of

price underselling is supported by substantial evidence in the record. In the Final Determination,

the ITC first engaged, as required by the statute, in a comparison of prices of domestic and

imported product. The ITC used the tabulations of domestic and import prices contained in the

Staff Report. In these price comparisons, employing two slightly different methodologies, the

ITC found a “mixed pattern” of under- and overselling and further noted that, for product 1, the

incidences of underselling, despite slightly outnumbering overselling when a lag was

incorporated, were nevertheless less infrequent than overselling in the absence of the lag.27 The

ITC additionally observed that quantity oversold was greater than quantity undersold. The ITC

proceeded to attribute the admittedly frequent occurrence of underselling for other products to

       27
           Contrary to Fair Beam’s assertion, that the ITC in another investigation (that of
stainless steel plate) found a mixed pattern of under- and overselling coupled with rising import
volumes “significant” for purposes of price effects is not binding on the ITC in a subsequent
investigation, as the court noted throughout this opinion regarding the ITC’s factual
determinations.
Ct. No. 02-00531                                                                        Page 32

the price premium the domestic product commands in the U.S. market. The existence of a price

premium for domestic product was supported by testimony from both sides at the administrative

hearing. As urged by the ITC, the court notes that the Timken decision stands for the proposition

that the ITC may discount incidences of underselling on account of this price premium, where

appropriate, as this premium mitigates underselling that is observed. Timken, 20 CIT at 87-88,

913 F. Supp. at 589-90.28 Moreover, the court agrees with the ITC that the “significance” of

price effects does not turn on a sole finding of more instances of underselling than overselling.

       The statute also requires the Commission to determine whether “the effect of imports . . .

otherwise depresses prices to a significant degree or prevents price increases, which otherwise

would have occurred, to a significant degree.” § 1677(7)(C)(ii)(II). The court finds that the

ITC’s finding with respect to this second component of price effects analysis is supported by the

       28
            The Timken court stated:

       The Commission concluded that factoring in the price premium for domestic other
       special quality bars made the relatively small margins of underselling even less
       significant. [] Thus, the Commission appropriately examined whether there had
       been "significant price underselling" by the subject imports. See 19 U.S.C. §
       1677(7)(C)(ii)(I). Evidence of underselling has been found to be less significant
       where there were price premiums for domestic products. See Roses, Inc. v. United
       States, 13 CIT 662, 665-66, 720 F. Supp. 180, 183 (1989) (62 out of 110 instances
       of underselling found insignificant because price premiums for locally-grown
       roses based on freshness and an ability to supply the flowers on a short-term need
       basis). See also Trent Tube Div., Crucible Materials v. United States, 14 CIT
       386, 402, 741 F. Supp. 921, 935 (1990) (consistent underselling given less weight
       based on domestic price premium due to customer preferences and lead time
       differences, small volume of imports a consideration), aff'd, 975 F.2d 807 (Fed.
       Cir.1992). Thus, the Court cannot say that the Commission's conclusion was
       erroneous.
Ct. No. 02-00531                                                                          Page 33

record. In addition to the elimination of the supply shortage, the ITC in the Final Determination

found that the price decline at the end of the POI was a result of weak demand in this period and

a rise of distributors’ inventories. The record contains sufficient evidence to support this finding

of the ITC, as well as its implications. In particular, the record indicates that demand for

structural steel beams rose from 1999 to 2000 and flattened in 2001. Moreover, testimony and

published articles cited in the Final Determination supported the observation that in the

beginning of the POI, purchasers had a more rosy outlook on the condition of the economy and

the market, which at the end proved to be unwarranted. The record contained evidence of a

developing domestic supply shortage in the beginning of the POI and its subsequent resolution.

Moreover, the court notes that, as explained earlier, the rise of subject import prices from 1999 to

2000 and their subsequent decline in 2001 cannot be ascribed to the similar trajectory of subject

import volumes since the introduction of subject imports into the U.S. market would have led to

a more immediate fall in prices due to ensuing competition.

       Here, Fair Beam seems to be advancing a type of “price lag” theory arguing that, if

subject imports had a delayed impact on prices, the later fall in prices could be attributable to the

rise in volumes at the beginning of the POI. Fair Beam’s reading of events taking place during

this period and their interaction may have some plausibility if a lag in price effects could be

properly assumed. However, under the substantial evidence standard, this court is charged to

uphold the ITC’s reasonable inferences from facts contained in the record. “It is not within the

Court’s domain either to weigh the adequate quality or quantity of the evidence for sufficiency or

to reject a finding on grounds of a differing interpretation of the record.” Timken Co. v. United
Ct. No. 02-00531                                                                        Page 34

States, 12 CIT 955, 962, 699 F. Supp. 300, 306 (1988), aff’d, 894 F.2d 385 (Fed. Cir. 1990)

(citation omitted). In other words, the court cannot give effect to alternative theories advanced

by Plaintiffs or accord more weight to supporting facts highlighted by Plaintiffs, however

plausible they may be, as long as the ITC’s theory of events are also reasonable and supported by

substantial evidence.

       Moreover, the ITC did entertain Fair Beam’s argument that subject imports may have had

a delayed impact on prices and rejected the argument. First, the ITC found that prices in the U.S.

structural steel beam market are determined on the spot when offer and acceptance take place

(even for the domestic producers). See Final Determination at 26 n.100. Second, the ITC

rejected the “price lag” predictions of Fair Beam’s econometric model reasoning that the model

was flawed. See id. at 29 n.107.

       At the end of its price effects analysis, the ITC announced, “[w]e cannot conclude that the

record indicates that either the inventory overhang or the resulting price declines were the

function of the subject imports . . . . We consequently conclude that the subject imports did not

have significant price-depressing or -suppressing effects.” Id. at 29-30. The ITC’s decision was

informed by its repeated observations in the Final Determination that the movements or activity

in the U.S. structural steel beam market during the POI were explainable by factors wholly

unrelated to subject imports with potentially unfair prices. The ITC was correct in highlighting

that a finding of “significant” price effects necessarily requires an accompanying finding of

causal relationship between prices and subject imports.
Ct. No. 02-00531                                                                        Page 35

D. THE ITC’S DETERMINATION THAT SUBJECT IMPO RTS HAD NO ADVERSE IMPACT IS
SUPPORTED BY SUBSTANTIAL EVIDENCE AND IS OTHERWISE IN ACCORDANCE WITH LAW .

Parties’ arguments.

       Fair Beam next charges that the ITC failed to consider that the domestic industry suffered

large losses in sales and revenues. See Pls.’ Br. at 21. Fair Beam argues that in the Final

Determination, the ITC dismissed this evidence as “anecdotal,” whereas in Beams I the ITC

represented a similar condition as “further evidence of the negative effects of subject imports,”

which inconsistency is allegedly unsupportable under Usinor. Id. at 22.

       The ITC argues that the Final Determination properly weighed the lost sales and

revenues data. See Def.’s Br. at 22. The ITC argues that since the decline in domestic industry

performance occurred from 2000 to 2001 when subject imports were declining, a link could not

be established between subject imports and alleged lost sales and revenues. See id. In addition,

the Final Determination found no adverse price effects. The combination of these two

observations led the ITC to discount as “anecdotal” the lost sales and revenues data.

       Salzgitter points out that “the performance of the domestic industry tracked the rise and

fall of apparent U.S. consumption.” Salzgitter Br. at 13. Thus, the decline in performance was

not a function of imports. Salzgitter emphasizes that at the end of POI, the domestic industry

actually gained market share (a “historic high”). Id. Salzgitter observes that the ITC construed

this phenomenon as imports “filling shortages” and not “displacing domestic production.”

Impact analysis.

       Contrary to Fair Beam’s assertion, the ITC’s analysis involved a reasoned consideration

of the lost sales and revenues data based on an extensive and detailed staff report. In a footnote
Ct. No. 02-00531                                                                           Page 36

to the Final Determination, the ITC observed that because there was underselling of subject

imports, it was “not surprising that there were some confirmed lost sales and revenues.” Final

Determination at 26 n.102. The domestic industry “submitted 27 lost sales and 173 lost revenue

allegations,” alleged lost sales totaling $[[ ]] million and alleged lost revenues totaling $[[ ]]

million. Staff Report at V-18 & App. E. In the Staff Report, the ITC staff confirmed or

“partially” confirmed 17 lost sales allegations of $24.1 million and 49 lost revenue allegations

of $786,411. Id. at V-18 & V-19. The ITC staff added that a “large number of lost revenues

allegations involve sales or quotations made after January 1, 2002” and that “[b]ecause of time

constraints, and because purchasers don’t always keep records of unsuccessful bids, some

purchasers were unable to confirm or deny some specific allegations.” Id. at V-19. In the Final

Determination, considering the Staff Report, the ITC pronounced that “[b]ecause these

allegations concern a period later than that for which the Commission collected pricing data, the

record does not indicate whether they are indicative of overall pricing or underselling trends.”

Final Determination at 26 n.102. Moreover, the ITC stressed that the lost sales and revenue data

was “anecdotal” and could not “outweigh the patterns” contained in “the pricing data overall.”

Id. The court finds the ITC’s reasons to be sound and consistent with the underlying record.

       Further, the ITC is not required to accord more weight to any factor of impact analysis at

the expense of other factors. Specifically, “[n]o factor, standing alone, triggers a per se rule of

material injury.” Am. Spring Wire Corp. v. United States, 8 CIT 20, 23, 590 F. Supp. 1273, 1277

(1984) (citation omitted). Accordingly, the fact that the ITC decided to de-emphasize confirmed

lost sales and revenues data does not detract from its finding of no impact because assigning

different weights to different pieces of evidence is fully within the ITC’s discretion.
Ct. No. 02-00531                                                                         Page 37

       The court finally notes that there is substantial evidence on the record in support of the

ITC’s finding that subject imports did not adversely impact the domestic industry. As required

by the statute, the ITC in the Final Determination considered “all relevant economic factors . . .

within the context of the business cycle and conditions of competition.” § 1677(7)(C)(iii). In the

Final Determination, the ITC noted that over the POI, the domestic industry actually gained

market share, that the domestic industry’s performance was improving as the subject import

volumes were increasing, and that the later retardation in variables designed to measure the

domestic industry’s “health” could not be ascribed to subject imports. The court agrees that

improvements in the output indicators (and other “health” factors) would likely not have been

observed alongside increases in subject import volumes, had subject imports had an injurious

present effect on the domestic industry. Further, as the ITC stated, the observed decline in output

indicators at the end of the POI was likely not the result of the rise in subject imports on account

of the intervening time between these two events. It may be that, as Salzgitter recommends,

domestic output fell (as well subject import quantities) along with falling demand for structural

steel beams in this period. For these reasons and given that the ITC found no “significant”

volume and price effects in the POI, the court concludes that the ITC’s no adverse impact finding

is supported by the record and is otherwise in accordance with law.

E. THE ITC’S DETERMINATION OF NO THREAT OF MATERIAL INJURY IS SUPPORTED BY
SUBSTANTIAL EVIDENCE AND IS OTHERWISE IN ACCORDANCE WITH LAW .

Parties’ arguments.

       In support of its argument that the ITC erred in finding no threat of material injury, Fair

Beam first cites the testimony of a foreign executive who stated that U.S. prices were
Ct. No. 02-00531                                                                         Page 38

“gorgeous,” and that foreign producers are able to “react” quickly and are profit oriented. Pls.’

Br. at 23. According to Fair Beam, this is evidence of the opportunistic nature of foreign

producers who move quickly to take advantage of price differentials across markets. This part of

Fair Beam’s argument stresses an inability to learn from past lessons. In particular, in Beams I

German and Spanish producers said they would not “opportunistically take advantage of short-

term opportunities” and were thereby excluded from that investigation. However, “[w]hat

happened next? . . . No sooner was the ink dry” on Beams I, then they returned and took

advantage of short-term opportunities. Id. at 24.

       Fair Beam further points to current excess capacity of foreign producers. See id. at 25. In

Beams I, the ITC relied on a similar condition as part of its threat determination, whereas in the

Final Determination, the ITC focused on the existence of markets other than the U.S. where

foreign producers could sell their products. According to Fair Beam, the Final Determination’s

focus ignores a number of facts. Id. at 26-27. First, the foreigners demonstrated an ability to

quickly penetrate and shift their exports to the U.S. market during the POI. Second, foreign

producers projected an increase of exports to the U.S. in 2002 and 2003. Third, foreign capacity

is expected to increase in the future. Similarly, Fair Beam also criticizes the ITC’s failure to

assign sufficient importance to increasing foreign inventories. See id. at 27. Because the ITC

found that some of the foreign inventories were not suitable for the U.S. market, Fair Beam

observes that “[s]ubject foreign producers can meet home market demand with such inventories,

while shifting production to ASTM products,” which are U.S.-market-compatible. Id. at 28. Fair

Beam further points out that “the scope of the merchandise subject to investigation [was] nearly

identical in Beams I and Beams II. Therefore, assuming there is some merit to the contention
Ct. No. 02-00531                                                                        Page 39

regarding different ASTM standards, it would equally be true for the inventories in both Beams I

and Beams II.” Id. Finally, Fair Beam contends that the ITC improperly disregarded evidence

concerning the “vulnerability” of the domestic industry. See id. at 29.

       The ITC counters that significant increases in imports were not imminent. See Def.’s Br.

at 23. The ITC highlights a number of factors. First, the volume of imports was declining at the

end of the POI. Second, the domestic capacity was increasing. Third, even though foreign

producers projected an increase in imports in 2002 and 2003, the projections were still below

2000 levels (the high in volume). Fourth, foreign producers had other markets in which to sell

their products. Five, the U.S. prices were traditionally higher (thus, the U.S. prices were not any

more “attractive” than they had always been).

       The ITC also argues that the Final Determination properly evaluated existing foreign

capacity and potential to shift the goods to the United States. The ITC claims that these two

factors are “insufficient to warrant an affirmative threat determination absent positive evidence

showing that increased levels of importation are actually imminent.” Id. at 26 (citing inter alia

BIC, 21 CIT at 464, 964 F. Supp. at 405 (“Conjecture and speculation are not enough; there must

be positive evidence tending to show an intention to increase levels of importation.”) (quotation

omitted)). The ITC posits that the Final Determination adequately explained why foreign

producers had no incentive to increase imports to the United States. Among other matters, the

Final Determination explained that not all steel beams of foreign production were suitable for

U.S. consumption because they did not meet U.S. standards. See id. at 27.

       The ITC next maintains that the Final Determination sufficiently considered the

“vulnerability” of the U.S. industry. See id. at 29. The ITC emphasizes that the domestic
Ct. No. 02-00531                                                                           Page 40

industry was about to expand capacity and “new and efficient” facilities were about to open. The

ITC indicates that while “vulnerability” is a proper factor to consider in threat analysis, it is not a

substitute for statutory criteria. See id. at 30 (citing NEC Corp. v. Dep’t of Commerce, 23 CIT

987, 999, 83 F. Supp. 2d 1339, 1342-43 (1999)).

       Stahlwerk argues that subject imports were declining at the end of the POI (“for six

straight quarters”) and, therefore, it was reasonable for the ITC to assume that such a trend would

continue. Stahlwerk Br. at 25-26. With respect to U.S. prices being attractive for foreign

producers to enter the market in the future, Stahlwerk stresses the price premium, implying that

the U.S. prices will always be higher. See id. at 26. With respect to foreign unused capacity,

Stahlwerk ponders why such capacity would not prevent subject imports from falling towards the

end of POI. See id. at 27. With respect to the domestic industry’s “vulnerability,” Stahlwerk

argues that the ITC did consider the industry’s overall profitability with “new and efficient” mills

in the works and that the ITC was not required to analyze the “unusually sensitive” nature of the

industry to subject imports, once the ITC decided that the subject imports were not about to rise

significantly. See id. at 28-29. Salzgitter adds that the ITC’s negative threat determination

followed logically from its negative material injury determination. See Salzgitter at 14.

Threat Analysis.

       In a threat of material injury determination, the ITC must find whether “further dumped

or subsidized imports are imminent and whether material injury by reason of imports would

occur unless an order is issued.” § 1677(7)(F)(ii). The pertinent factors outlined in the statute

for a finding of threat of material injury are: (II) latent production capacity (or an imminent

increase thereof) in the subject countries, taking into account alternative export markets; (III)
Ct. No. 02-00531                                                                            Page 41

“significant” increase in volume or market penetration of subject imports indicating “likelihood

of substantially increased imports;” (IV) likely “significant” suppression of price as to lead to an

increase in future demand for imports; (V) inventories; (VI) ability of subject countries to shift

production to subject merchandise; (VIII) “actual and potential negative effects” on the domestic

industry’s development; and (IX) “any other demonstrable adverse trends that indicate the

probability that there is likely to be material injury by reason of” subject imports.29 §

1677(7)(F)(i). The ITC must evaluate the statutory factors “as a whole” in making a threat

determination. § 1677(7)(F)(ii). No such factor will “necessarily give decisive guidance with

respect to the determination.” Id. Moreover, the statute specifies that a threat determination

cannot be based on a “mere conjecture or supposition.” Id. Because section 1677(7)(F)(i) directs

the ITC to consider all relevant economic factors in a threat investigation, the ITC has “no

discretion in this matter.” Suramerica de Aleaciones Laminadas, C.A. v. United States, 44 F.3d

978, 984 (Fed. Cir. 1994); § 1677(7)(F)(i) (providing that the ITC “shall” consider all relevant

economic factors).

       The court agrees with the ITC and Defendant-Intervenors that there is substantial

evidence in the record to support the Final Determination’s negative threat of material injury

determination. A threat of material injury determination necessarily involves a prediction of the

future. By warning that a “mere conjecture” is not enough to sustain an affirmative threat

determination and by outlining non-discretionary factors to be evaluated, the statute aims to limit

hypothesizing that naturally accompanies such a prediction. The Commissioner who dissented

       29
          As stated by the ITC, the statutory factors (I) and (VII) are not relevant to this
investigation and, therefore, not considered in this opinion. See Final Determination at 35 n.130.
Ct. No. 02-00531                                                                         Page 42

from the negative threat determination of the ITC pointed out that the outlook of the U.S.

structural steel beam industry at the end of the POI was somewhat mixed. See Separate and

Dissenting Views of Commissioner Lynn M. Bragg, Certain Structural Steel Beams from China,

Germany, Italy, Luxembourg, Russia, South Africa, Spain, and Taiwan, Invs. No. 731-TA-935-

942 (July 2002) at 6 in Administrative Record, List 2, Doc. No. 171. The dissenting

Commissioner especially noted among conditions adverse to the domestic industry’s health: the

substantial decline in the domestic industry’s operating income, declining domestic capital stock

and restricted access to capital, domestic start-up operations that are especially vulnerable to

competitive forces, weak U.S. demand and increasing domestic inventories, increasing cost/price

ratio indicating dampening profits, capacity increases in subject countries (especially in China),

subject countries’ allegedly demonstrated ease to shift production to U.S.-market-compatible

product, domestic prices that persisted at higher levels than prices abroad, projected shipment

increases by the subject countries, and projected capacity utilization increases in the subject

countries. See id. at 6-8.

       The court notes, however, that these arguably unfavorable facts regarding the existence of

a threat were evaluated by the majority of the Commissioners and rejected. The ITC’s duty in

making a threat of material injury determination is to evaluate the non-discretionary statutory

factors. The statute, inter alia, requires the ITC to conduct renewed analyses of subject import

volumes and price effects regarding threat of material injury. In particular, the ITC shall examine

whether there has been a “significant” increase in subject import volumes during the POI such

that their continuing future presence in the U.S. market is “likely” and whether subject imports

are “likely” to depress prices as to increase future demand for imports. See § 1677(7)(F)(i)(III) &
Ct. No. 02-00531                                                                         Page 43

(IV). Accordingly, the ITC observed that at the end of the POI, both subject import volumes and

prices were declining. In connection with its earlier finding that a domestic shortage was

responsible for the rise in the subject import volumes, the ITC determined that “there was no

likelihood of shortages in the imminent future” and, therefore, a similar rise in subject import

volumes was not likely to occur in the future. Final Determination at 36. As urged by Fair

Beam, the subject countries demonstrated an ability to shift shipment to the U.S. market with

relative ease; however, given that the subject countries’ shipments to the United States increased

as a response to a temporary domestic shortage during the POI and subject imports left the U.S.

market once the shortage was resolved, the ITC further predicted that a “significant” increase in

subject imports was “unlikely.”

       Further, faced with declining prices at the end of the POI, the ITC could not but observe

that imports were not likely to be spurred by favorable prices. Even though U.S. prices remained

higher than prices elsewhere at the end of the POI, this was generally so and, therefore, this factor

was not likely to encourage further imports in this specific period. In addition, as urged by the

ITC counsel during oral argument, the pertinent comparison is not that the U.S. prices remained

higher than prices abroad at the end of the POI, as expected, but that the U.S. prices were for the

most part lower in 2001 than they had been in 2000.30 Oral Arg. Tr. 34:5-21. Moreover, the ITC

found no “significant” volume and price effects for the POI and asserted that there was no

indication that these phenomena were likely to change in the imminent future.

       With respect to subject countries’ production capacity, the ITC noted that, even though an

       30
         There is a suggestion in the record that an improvement in price at the very end of the
POI took place as domestic producers responded to the onset of this investigation by increasing
prices. See Purchasers’ Questionnaires at 13 Question III-31 in Pls.’ App. tab 11.
Ct. No. 02-00531                                                                            Page 44

increase had been projected, there was no indication that such an increase would manifest itself

as an imminent increase in subject import volumes. Final Determination at 37. As required by

the statute, the ITC further indicated that subject countries had alternate markets at home or

abroad to expend their capacity. With respect to subject countries’ inventories, the ITC noted an

increase during the POI, but also observed that not all structural beams inventories abroad were

suitable for sale in the U.S. market by virtue of failing to satisfy the U.S. standard.31 Id. at 38.

With respect to the domestic industry’s production capacity, the ITC pointed out that “new and

efficient” facilities had already been completed or were about to be completed.32 Id. at 38-39.

All of these determinations concerning the statutory factors, provided for in section

1677(7)(F)(i)(II), (V) and (VI), were based on the detailed Staff Report and testimony presented

at the administrative hearing.

        Fair Beam also charges that the ITC did not consider the “vulnerability” of the domestic

industry. The court notes, however, that the consideration of “vulnerability” of the domestic

        31
          By merely mandating that the ITC consider “inventories of subject merchandise,” §
1677(7)(F)(i)(V), the statute is not clear about whether the domestic industry’s inventories are
also to be considered. The ITC in the Final Determination nevertheless considered the level of
domestic inventories during the POI and observed that although increasing “in absolute terms,”
domestic inventories declined “relative to imports and U.S. shipments of imports from 1999 to
2000.” Final Determination at 38. “In 2001, these inventories declined from 2000 levels in
absolute terms but were greater in relative terms than in either 1999 or 2000. However, the ratios
of inventories to imports and to shipments of imports were at extremely low levels throughout
the period of investigation.” Id.
        32
         Implicit in this observation is the consideration of the statutory factor (VIII). §
1677(7)(F)(i) (requiring consideration of “actual and potential negative effects” of imports on the
domestic industry’s development).
Ct. No. 02-00531                                                                           Page 45

industry is not specifically provided for in the statute as part of the required analysis.33 While it

is proper for the ITC to consider “vulnerability” among “relevant economic factors,” §

1677(7)(F)(i), it cannot be the sole basis of an affirmative threat determination in the presence of

other statutory criteria that have not been fulfilled. See NEC, 23 CIT at 999, 83 F. Supp. 2d at

1342-43.34 Moreover, the ITC in the Final Determination did consider the “vulnerability” of the

domestic industry in indicating that despite varying performances of individual players, the

domestic industry remained “profitable overall.” Final Determination at 39. The views of the

       33
          The “vulnerability” language appears in the legislative history of the Uruguay Round
Agreements Act. See SAA at 885 (“In material injury determinations, the Commission
considers, in addition to imports, other factors that may be contributing to overall injury. While
these factors, in some cases, may account for the injury to the domestic industry, they also may
demonstrate that an industry is facing difficulties from a variety of sources and is vulnerable to
dumped or subsidized imports.”).
       34
            The NEC court stated:

               In a threat determination, "vulnerability analysis" is appropriate and
       relevant to consider as "among other relevant economic factors." [] 19 U.S.C. §
       1677(7)(F)(i) (1994). Underlying vulnerability analysis is the principle that the
       foreign industry must "take the domestic industry as [it] finds it." Hosiden Corp.
       v. Advanced Display Mfrs. of Am., 85 F.3d 1561, 1569 (Fed.Cir.1996) (quoting
       Iwatsu Elec. Co. v. United States, 15 CIT 44, 57, 758 F.Supp. 1506, 1518 (1991)).
       In Goss Graphics, the Court endorsed the use of "vulnerability analysis," so long
       as "the Commission did not substitute its finding of vulnerability for consideration
       of the statutory criteria." Goss Graphics [v. United States, 22 CIT 983, 1004, 33 F.
       Supp. 2d 1082, 1101 (1998)]. Accordingly, an affirmative threat determination
       based solely on a finding of vulnerability coupled with the presence of statutory
       factors would be the kind of temporal connection disapproved of in Gerald
       Metals[, 132 F.3d at 716.] Yet the "by reason of" standard is met if the
       Commission can articulate a causal connection between the threat of injury to the
       domestic industry and the subject imports themselves, while avoiding attributing
       the threat from non-import factors to threat from subject imports. See Goss
       Graphics, []33 F.Supp.2d at 1103 (affirming the Commission's conclusion that,
       "[t]he vulnerability of the industry in combination with the adverse trends of
       increased subject imports and the small number of pending sales created the threat
       of material injury.").
Ct. No. 02-00531                                                                         Page 46

dissenting Commissioner bring to the attention of the court a number of arguably unfavorable

conditions surrounding the domestic industry in this period, especially towards the end of the

POI, making it vulnerable to dumped imports. A decline in domestic industry’s sales revenues

and operating income in the 2000-2001 period was also acknowledged by the ITC panel in its

impact determination. Final Determination at 33. There, the ITC determined that the declining

trends were not due to subject imports, but at least in part ascribable to a decline in demand. As

the statute requires a causal link between a threat of material injury finding and subject imports, §

1673d(b)(1), and as the record establishes a number of favorable conditions pertaining to the

domestic industry, the court cannot say that the majority of the Commissioners’ treatment of the

domestic industry’s adverse trends was unreasonable and factually unsupportable.

                                         IV. CONCLUSION

       In light of the foregoing, the court sustains the ITC’s negative material injury and

negative threat of material injury determinations in Certain Structural Steel Beams from China,

Germany, Luxembourg, Russia, South Africa, Spain and Taiwan, Invs. Nos. 731-TA-935-936

and 938-942 (Final), USITC Pub. No. 3522 (June 2002). Accordingly, the court denies

Plaintiffs’ Motion for a Judgment upon an Agency Record. Judgment will be entered

accordingly.

Dated: __________________________                     __________________________
       New York, New York                             Judith M. Barzilay
                                                      Judge
                                         ERRATUM

Committee for Fair Beam Imports v. United States, Ct. No. 02-00531, Slip Op. 03-73, Dated
June 27, 2003.

Page 3, footnote 3:

Footnote 3 on page 3 should read:

Initially, Italy was also investigated. However, upon a finding of no dumping by Commerce, the
ITC discontinued its investigation of Italian structural beams. The court further notes that no
cumulation issues are raised in this appeal.

July 22, 2003