Rulings, remedies and court proceedings for customs and trade professionals

BIS Continues to Deny Tin Mill Products Importer's Section 232 Exclusion Requests

The Commerce Department's Bureau of Industry and Security continued to deny importer Seneca Food's eight Section 232 steel tariff exclusion requests for its tin mill products on remand at the Court of International Trade. BIS said that U.S. Steel can make the same products in a sufficient quantity and in a timely manner to satisfy Seneca's needs, prompting the rejection of the exclusion bids (Seneca Foods Corp. v. United States, CIT # 22-00243).

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The trade court had previously remanded the exclusion rejections on the grounds that BIS failed to address contradicting evidence that the U.S. industry couldn't timely provide the products (see 2310180052). In particular, the court noted "two email correspondences" that Seneca put on the record which supposedly contradicted U.S. Steel's comments about the quantity and timeliness of its steel capacity.

The first correspondence is from November 2020 and is between Seneca employees. One employee says that U.S. Steel said it's "not offering anything now at any price" and that if it has available production in any month, it will contact Seneca to see if it has interest. BIS said that it referred the email to a subject matter expert which concluded that the email "did not identify any product or provide any details about a product." As a result, the expert said that the email "does not refer to the same product as the requested product in any way because there is no product identified in the email."

"It is Commerce’s practice to discount the evidentiary value of emails or other sales correspondence when there is a lack of evidence to ascertain whether the correspondence refers to the same product as the requested product," the remand results said.

In addition, the email said that U.S. Steel doesn't "want to commit to anything right now." BIS said that this "highlights the temporal nature of the business because Commerce interprets the phrase 'right now' to mean November 2020."

The second email correspondence, which took place in November 2021 but is redacted from the public, was found by a Commerce subject matter expert to reference the same product. Since it references the same product and was sent within 90 days of the exclusion request, Commerce analyzed the effects of the email on five of the eight exclusion requests.

Part of the November 2021 email discussed import delivery times and was used by Seneca to claim that there is conflicting evidence on U.S. Steel's representations about whether it could "timely produce and deliver the requested product." The importer said U.S. Steel "has been unwilling to commit to any contractual volume thus far," while U.S. Steel said it "confirmed" that it can supply the requested amount within the 120-day manufacturing lead time reported for Seneca's Japanese supplier.

"Seneca's November email from U.S. Steel does not establish unavailability from U.S. Steel given U.S. Steel's certified representations in these proceeding that it could timely provide the full quantity of the requested product through spot sales," Commerce said.

The email "concerns a long running discussion and attempt to secure future volume of the requested product" and leaves open the possibility that conditions could change in the future, "which we interpret to be consistent with potential sales in the future through either contract sales or spot sales," BIS said. Going through each five exclusion requests affected by the November 2021 email, the agency said that there's enough evidence to show that Commerce was justified in its ultimate conclusion that U.S. Steel could timely meet the importer's quantity demands.

The court also discussed the "business relationship between Seneca and U.S. Steel" and echoed the importer's claim that U.S. Steel "has declined to quote, offer, or deliver a single ton of steel to Seneca for more than two years." The agency said it doesn't afford great weight to the history of interactions between requestors and objectors "unless it is clearly related to a denial of a prior request for the same product" or indicative of the parties' future dealings. In all, the agency said it "finds it irrelevant that U.S. Steel has not sold to Seneca for more than two years."