Commerce finds critical circumstances on graphite electrodes from India

The U.S. Department of Commerce preliminarily determined that critical circumstances exist with respect to imports of large diameter graphite electrodes from India, a finding that opens the way to retroactive suspension of liquidation and cash deposits on the merchandise. The determination, issued under case number C–533–949, was published in the Federal Register of October 1, 2026 (Vol. 91, No. 189, p. 62498) and is applicable from that same date.

The decision rests on section 703(e)(1) of the Tariff Act of 1930, as amended, and 19 CFR 351.206, which require Commerce to find both a reasonable basis to believe or suspect that the alleged countervailable subsidy is inconsistent with the World Trade Organization’s Subsidies and Countervailing Measures Agreement and that imports surged massively over a relatively short period. Commerce initiated the countervailing duty investigation on March 20, 2026 (91 FR 13577) and published its preliminary determination on July 30, 2026 (91 FR 48081). The period of investigation runs from January 1, 2025, through December 31, 2025.

Export-contingent subsidies

Commerce found a reasonable basis to believe or suspect that Graphite India Limited (GIL), HEG Limited (HEG) and all other producers and exporters received countervailable subsidies contingent upon export performance. The programs cited on the record are:

• Advance Authorization Program
• Duty Drawback Program
• Export Promotion of Capital Goods Scheme
• Remission of Duties and Taxes on Export Products

Because those programs are contingent on export performance, Commerce preliminarily found that the criterion under section 703(e)(1)(A) of the Act had been met.

A surge above fifteen percent

The allegation was filed on September 1, 2026 by Resonac Graphite America Inc. and Tokai Carbon GE LLC, more than 30 days before the scheduled final determination, which obliged Commerce to issue its preliminary findings within 30 days. The petitioners compared total import volumes for a base period of October 2025 through February 2026 with a comparison period of March 2026 through July 2026 and reported an increase of more than 15 percent, the threshold at which imports are normally considered massive under 19 CFR 351.206(h)(2).

Commerce compared the reported shipments of GIL and HEG over the five months before and after the filing of the petition, dated February 24, 2026, and preliminarily determined that imports from both companies increased by more than 15 percent. For all other exporters and producers, third-party import data proved unreliable because reported shipments exceeded the third-party figures in several months, so Commerce relied on an average of GIL’s and HEG’s shipments and still found an increase above 15 percent.

Retroactive collection and next steps

Under section 703(e)(2)(A) of the Act, Commerce intends to direct U.S. Customs and Border Protection (CBP) to suspend liquidation of any unliquidated entries of the subject merchandise entered, or withdrawn from warehouse for consumption, on or after May 1, 2026 — 90 days prior to the date of publication of the preliminary determination. CBP will require a cash deposit equal to the estimated preliminary subsidy rates established in that determination, and the suspension will remain in effect until further notice.

Commerce will make its final determination concerning critical circumstances in the final determination of the investigation, currently scheduled for December 7, 2026, and will notify the International Trade Commission (ITC). Case briefs and written comments may be submitted to the Assistant Secretary for Enforcement and Compliance, with rebuttal briefs due no later than five days after the case brief deadline and executive summaries limited to 450 words. The notice is signed by Scot Fullerton, Acting Deputy Assistant Secretary for Antidumping and Countervailing Duty Operations, dated September 28, 2026, with Robert Galantucci of AD/CVD Operations, Office V, as the contact.

The finding matters for U.S. steel and aluminum producers that depend on large graphite electrodes for electric arc furnace and smelting operations: retroactive cash deposits raise the landed cost of Indian electrodes for entries dating back to May 1, 2026, and may tighten supply or shift sourcing while the case runs to its December 7 final determination.

Source: Federal Register, Vol. 91, No. 189, October 1, 2026, Notices, p. 62498 (official reference: C–533–949; FR Doc. 2026–20162).