Shenzhen Xinboda Industrial Co. v. United States (279 F. Supp. 3d 1265, 2017)

OPINION

RIDGWAY, Judge:

Plaintiff Shenzhen Xinboda Industrial Co., Ltd. (“Xinboda”) a Chinese exporter of fresh garlic commenced this action to contest the Final Determination in the U.S. Department of Commerce’s fifteenth administrative review of the antidumping duty order covering fresh garlic from the People’s Republic of China. The period of review is November 1, 2008 through October 31, 2009. See Fresh Garlic from the People’s Republic of China: Final Results and Final Rescission, in Part, of the 2008-2009 Antidumping Duty Administrative Review, 76 Fed. Reg. 37,321 (Dep’t Commerce June 27, 2011) (“Final Determination”); Issues and Decision Memorandum for the Final Results of the 15th Administrative Review of Fresh Garlic from the People’s Republic of China (June 20, 2011) (AR Pub. Doc. No. 176) (“Issues & Decision Memorandum”); see generally Shenzhen Xinboda Industrial Co. v. United States, 38 CIT -, 976 F.Supp.2d 1333 (2014) (“Shenzhen Xinboda I”).

In its Complaint, Xinboda challenged Commerce’s decisions in its Final Determination as to the surrogate financial statements used to derive surrogate financial ratios, the surrogate value for labor (i.e., the surrogate wage rate), and the surrogate value for. whole raw garlic bulbs, as well as the agency’s application of its “zeroing” methodology in calculating Xinbo-da’s dumping margin. See generally Complaint; see also Shenzhen Xinboda I, 38 CIT at -, 976 F.Supp.2d at 1345-46.

Ruling on Xinboda’s Motion for Judgment on the Agency Record, Shenzhen Xinboda I remanded this matter to Commerce for further consideration of all four issues, including a voluntary remand on the surrogate value for labor. See generally Shenzhen Xinboda I, 38 CIT at -, -, 976 F.Supp.2d at 1338, 1388. Now pending are Commerce’s Remand Results, filed pursuant to Shenzhen Xinboda I. See generally Final Results of Redetermination Pursuant to Remand (SAR Pub. Doc. No. 7) (“Remand Results”).

Xinboda is satisfied with Commerce’s Remand Results as to the surrogate value for labor, as well as Commerce’s exclusion of certain transportation expenses in determining the surrogate value for whole raw garlic bulbs. See Remand Results at 3, 29, 57 (surrogate value for labor); id. at 3, 8-9, 47-48 (surrogate value for whole raw garlic bulbs); Plaintiffs Comments on Remand Redetermination (“Pl.’s Brief’) at 1 n.1. However, Xinboda contends that the Remand Results are flawed in all other respects. See generally Pl.’s Brief; Plaintiffs Reply to Response Comments on Remand Redetermination (“Pl.’s Reply Brief’).

In contrast, the Government and the Defendant-Intervenors the Fresh Garlic Producers Association, Christopher Ranch, L.L.C., The Garlic Company, Valley Garlic, and Vessey and Company, Inc. (collectively, the “Domestic Producers”) assert that the Remand Results are both supported by substantial evidence and in accordance with law. The Government and the Domestic Producers maintain that the Remand Results therefore should be sustained. See generally Defendant’s Response to Comments Regarding the Remand Redetermi-nation (“Def.’s Brief’); Defendant-Inter-venors’ Response to Plaintiffs Comments on Remand Redetermination (“Def.-Ints.’ Brief’).

Jurisdiction lies under 28 U.S.C. § 1581(c) (2006). For the reasons set forth below, the Remand Results are sustained as to the surrogate value for labor and Commerce’s application of zeroing in this administrative review. The surrogate value for whole raw garlic bulbs and the selection of surrogate financial statements are again remanded, for Commerce’s further consideration.

I. Background

Shenzhen Xinboda I laid out the relevant statutory scheme, including citations to the statute and other pertinent authorities. That explanation, together with other relevant background, is summarized below, in the interests of convenience and completeness.

As Shenzhen Xinboda I explained, dumping occurs when goods are imported into the United States and sold at a price lower than them “normal value,” resulting in material injury (or the threat of material injury) to the U.S. industry. The difference between the normal value of the goods and the U.S. price is the “dumping margin.” When normal value is compared to the U.S. price and dumping is found, antidumping duties equal to the dumping margin are imposed to offset the dumping. See Shenzhen Xinboda I, 38 CIT at -, 976 F.Supp.2d at 1338 (and authorities cited there).

When the exporting country is a market economy country, normal value generally is calculated using either the price in the exporting market (i.e., the price in the “home market” where the goods are produced) or the cost of production of the goods. However, where as here the exporting country has a non-market economy, there is often concern that the factors of production (inputs) that are consumed in producing the goods at issue are under state control, and that home market sales therefore may not be reliable indicators of normal value. See Shenzhen Xinboda I, 38 CIT at -, 976 F.Supp.2d at 1338 (and authorities cited there).

In such cases, Commerce identifies one or inore Market economy countries to serve as a- “surrogate” and then “deter-minéis] the' normal value of the subject merchandise on the basis of the value of the factors of production” (ie., the value of the inputs) in the relevant surrogate country or countries, including “an amount for general expenses and profit plus the cost of containers, coverings, and other expenses.” This surrogate value analysis is designed to determine a producer’s costs of production as if the producer operated in a hypothetical market economy country. See Shenzhen Xinboda I, 38 CIT at -, 976 F.Supp.2d at 1338-39 (and authorities cited there).

Under the statute, factors of production “include, but are not limited to (A) hours of labor required, (B) quantities of raw materials employed, (C) amounts of energy and other utilities consumed,- and (D); representative capital cost, including depreciation.” See Shenzhen Xinboda I, 38 CIT at — n.4, 976 F.Supp.2d at 1338 n.4; 19 U.S.C. § 1677b(c)(3). However, valuing the factors of production (inputs) consumed in producing goods does not capture (1) manufacturing/factory overhead, (2) selling, general, and administrative expenses (“SG & A”), and (3) profit. Commerce calculates those surrogate values using ratios known as “surrogate financial ratios” that the agency derives from the- financial statements of one or more surrogate companies that produce-identical (or at least comparable) merchandise in- the' relevant surrogate market economy country. See Shenzhen Xinboda I, 38 CIT at -, 976 F.Supp.2d at 1343-44 (and authorities cited there). As discussed in greater detail below, Commerce’s selection of surrogate financial statements continues to be at issue here.

In certain circumstances, where Commerce finds that the available information on the-value of factors of production is not adequate for purposes of determining the normal value of the goods at issue pursuant to the agency’s standard “factors • of production” methodology (described above), Commerce determines the surrogate value of an “intermediate input” in-, stead. Under Commerce’s so-called “intermediate input methodology,” rather than valuing the-various-individual “upstream” factors of production that are used to produce an intermediate input, Commerce directly values the “downstream” intermediate input itself. See Shenzhen Xinboda I, 38 CIT at -, 976 F.Supp.2d at 1339 (and authorities cited there). As discussed in greater detail below, Commerce has used its intermediate input methodology to determine the surrogate value for whole raw garlic bulbs here. That value continues to be contested.

The underlying antidumping order in this case, which dates back to 1994, covers imports of fresh garlic from China, including whole garlic bulbs and peeled garlic cloves (the products exported by Xinboda). As noted above, this action involves the fifteenth administrative review of that antidumping order, covering the period November 1, 2008 through October 31, 2009. See Shenzhen Xinboda I, 38 CIT at -, 976 F.Supp.2d at 1340. Commerce selected India as the primary surrogate country for purposes of this review (as in prior reviews), and used data from India to calculate the surrogate values for all factors of production, with the sole exception of labor. See id., CIT at -, 976 F.Supp.2d at 1340 (and authorities cited there).

Surrogate Value for Whole Raw Garlic Bulbs. In the course of the administrative review, Commerce compiled voluminous in-' formation concerning Xinboda and its operations, particularly the company’s exports of whole garlic bulbs and peeled garlic cloves to. the U.S. from China. Commerce similarly compiled detailed information on Zhenzhou Dadi Garlic Industry Co., Ltd. (“Dadi”), the affiliated processor/producer that supplied Xinboda with garlic products produced from the whole raw garlic bulbs that Dadi purchased from local Chinese garlic farmers. Dadi processed the whole raw garlic bulbs that it purchased which had diameters of between 60 mm and- 65 mm into whole garlic bulbs and peeled garlic cloves for Xinboda, using relatively simple procedures involving principally manual labor. See Shenzhen Xinboda I, 38 CIT at -, 976 F.Supp.2d at 1340-41 (and authorities cited there).

To produce whole fresh garlic, Chinese garlic farmers deliver to Dadi whole raw garlic bulbs, sorted by size, in large mesh bags. Dadi workers sitting at tables in a simple warehouse then rub. off the outer skins of the whole raw garlic bulbs (to give the garlic bulb a clean white appearance), cut or trim the roots and stems, place the bulbs into small mesh bags (typically holding three to five bulbs, depending on the customer), and affix the customer’s labels to seal the bags. Bags are then packed into cartons, ready for shipping. Like its process for production of whole fresh garlic, Dadi’s process for the production of peeled garlic cloves is also relatively simple and involves mostly manual labor. See Shenzhen Xinboda I, 38 CIT at -, 976 F.Supp.2d at 1341 (and authorities cited there).

Xinboda’s administrative operations are similarly modest, and its sales process is also basic and straightforward. Xinboda does not develop or market its own brands and sells only a handful of products (ie., garlic, onion shoots, and ginger) to its established customer base. Its advertising and selling expenses are minimal. See Shenzhen Xinboda I, 38 CIT at —, 976 F.Supp.2d at 1341 (and authorities cited there).

Early in the course of-the instant administrative review, Commerce concluded (as it had since the tenth, review) that Chinese garlic farmers generally do not track the actual labor hours expended in- growing and harvesting garlic,, and, thus, do not maintain the records that Commerce would:need to verify data reported for the expenses that Chinese, farmers incur in growing and harvesting whole raw garlic bulbs. Commerce therefore used -its intermediate input methodology tq value “growing” and .“harvesting” .factors of production, as it had since the tenth review. As such, in lieu of separately valuing each of the various individual growing and harvesting factors of production consumed in growing and harvesting a whole raw garlic bulb (ie., the leased land, garlic seed, water, pesticides, herbicides, fertilizer, plastic film, labor, and other “inputs” or commodities), Commerce instead sought to capture those factors of production by determining the value of the “intermediate input” ie., a whole raw garlic bulb. See Shenzhen Xinboda I, 38 CIT at - 976 F.Supp.2d at 1341-42 (and authorities cited there).

In valuing the whole raw garlic bulb input (ie., the intermediate input), Commerce based its calculations on size-specific prices for garlic bulbs sold at the Azad-pur APMC Market (located near Delhi and operated by the Azadpur Agricultural Produce Marketing Committee (“APMC”)), as published in the Azadpur APMC’s Market Information Bulletin. Commerce rejected the other potential sources of data on the record, including the prices favored by Xinboda ie., the prices for whole raw garlic bulbs included in the financial statements of Garlico Industries Limited (“Gar-lico”), an Indian purchaser, processor, and trader of garlic, onions, and other vegetables and related products based on Commerce’s determination that those other sources of data do not specify the physical characteristics of the garlic bulbs that were priced. See Shenzhen Xinboda I, 38 CIT at -, 976 F.Supp.2d at 1342-43 (citing Issues & Decision Memorandum at 12-13).

To value the whole raw garlic bulbs delivered to Dadi that had a diameter of greater than 55 mm, Commerce relied on non-contemporaneous Azadpur Market prices for garlic bulbs classified as “grade S.A.” (or “Super-A”), which Commerce then indexed (inflated) to be contemporaneous with the dates of the period of review. Commerce used non-contemporaneous prices to value this larger-bulbed garlic because the Azadpur Market ceased use of the “S.A.”-grade classification in February 2008 (before the period of review). See Shenzhen Xinboda I, 38 CIT at -, 976 F.Supp.2d at 1343 (and authorities cited there, including Preliminary Surrogate Value Memorandum at 4 (AR Pub. Doc. No. 121) and Issues & Decision Memorandum at 13).

To value the whole raw garlic bulbs delivered to Dadi that were somewhat smaller (with a diameter of between 50 mm and 55 mm), Commerce averaged the non-contemporaneous but indexed Azad-pur Market prices for grade “S.A.” garlic (described above) together with contemporaneous Azadpur Market prices for grade “A” garlic (i.e., prices for “A”-grade garlic from within the period of review). See Shenzhen Xinboda I, 38 CIT at -, 976 F.Supp.2d at 1343 (citing, inter alia, Final Surrogate Value Memorandum at 1 (AR Pub. Doc. No. 177)).

Surrogate Value for Labor (ie., Surrogate Wage Rate). To calculate the surrogate value for post-harvest labor costs for purposes of the Final Determination, Commerce averaged industry-specific data on wages and earnings from a group of eight countries that Commerce deemed to be both “significant producers” of comparable merchandise and “economically eompara-ble” to China, and which had also reported data under one particular revision of an international standard. However, that group of eight countries did not include India, because although India reported contemporaneous data under the prior revision of the international standard India’s reporting had not used the particular revision on which Commerce relied. Citing “concerns that the industry definitions may lack consistency between different ... revisions” of the standard, Commerce declined to include the Indian data in its calculations in the Final Determination. See Shenzhen Xinboda I, 38 CIT at -, 976 F.Supp.2d at 1343 (citing and quoting Issues & Decision Memorandum at 25, 27-28).

Surrogate Financial Statements/Surrogate Financial Ratios. As noted above, valuing the various direct inputs that are used to produce goods does not capture certain costs that must also be factored into prices specifically, manufaeturing/fac-tory overhead, selling, general and administrative expenses (“SG & A”), and profit. Commerce calculates surrogate values for those three items using surrogate financial ratios that it derives from the financial statements of one or more companies that produce the same or comparable merchandise in the surrogate market economy country. In its Final Determination here, Commerce derived Xinboda’s surrogate financial ratios from the unconsolidated financial statements of Tata Global Beverages Limited (specifically, Tata Tea”), an Indian company that grows, processes, and sells coffee and tea products. See Shenzhen Xinboda I, 38 CIT at -, 976 F.Supp.2d at 1343-44.

Commerce cited two reasons for selecting the financial statements of Tata Tea over the five other sets of financial statements on the record. First, Commerce concluded, based on its review of the other companies’ financial statements, that all but one of the five had received subsidies that the agency had previously determined to be countervailable. Based on its policy of disregarding a surrogate company’s financial statements where the agency has “reason to believe or suspect” that the company has received actionable subsidies (ie., subsidies that Commerce has previously found to be countervailable in a formal agency countervailing duty investigation), Commerce disregarded the financial statements of four of the five companies. Commerce rejected Xinboda’s claim that there is evidence on the record that gives “reason to believe or suspect” that Tata Teas “may” have received subsidies. See Shenzhen Xinboda I, 38 CIT at -, 976 F.Supp.2d at 1344 (quoting Issues & Decision Memorandum at 20-22).

Xinboda favors use of the financial statements of the remaining company, ie., the Indian garlic processor and trader Garlico. However, Commerce concluded that Garli-co’s operations were not comparable to those of Xinboda, based on the agency’s determination that “[Garlico’s] primary production is of downstream food products,” which “are described as ‘dehydrated’ or ‘powder,’ ” as well as the agency’s determination that Garlico “act[ed] as a trading company (rather than a food processor) on nearly one quarter of its sales.” Commerce declined to rely on a combination of the financial statements of Tata Tea and Garlico, even though the agency has a stated preference for the use of multiple financial statements. The Final Determination thus relied exclusively on the financial statements of a tea company, Tata Tea, rather than Garlico (which, Xinboda emphasizes, purchased and processed garlic). See Shenzhen Xinboda I, 38 CIT at -, 976 F.Supp.2d at 1344, 1385; Issues & Decision Memorandum at 20-22.

Application of “Zeroing” Methodology. Lastly, in its Final Determination, Commerce calculated Xinboda’s dumping margin using the agency’s “zeroing” methodology, which was the subject of extensive litigation. See Shenzhen Xinboda I, 38 CIT at - 976 F.Supp.2d at 1344 (and authorities cited there, including Issues & Decision Memorandum at 31-33). Thus, in calculating Xinboda’s dumping margin, Commerce assigned negative dumping margins (ie., margins of sales of merchandise found to have been sold ■ at non-dumped prices) a value of zero, and only positive dumping margins (ie., margins for sales of merchandise sold at dumped prices) were aggregated. In other words, sales that were not found to have involved dumping were not used to offset sales that were found to have involved dumping. See Shenzhen Xinboda I, 38 CIT at -, 976 F.Supp.2d at 1344.

Issuance of Final Determination and Subsequent Proceedings. Based on the methodologies, analyses, calculations, and data summarized . above, Commerce assigned Xinboda a weighted-average dumping margin of $0.06 per kilogram in the Final Determination. See Final Determination, 76 Fed. Reg. at 37,326; Shenzhen Xinboda I, 38 CIT at -, 976 F.Supp.2d at 1344-45.

Xinboda appealed, challenging four aspects of Commerce’s Final Determination. The first count of Xinboda’s Complaint disputes Commerce’s selection of financial statements for use in deriving the surrogate financial ratios used in calculating Xinboda’s dumping margin. See Complaint ¶¶ 10, 15-16 (Count I). Xinboda argues that Commerce’s justification for choosing the financial statements of Tata Teas is flawed and that Commerce’s rejection of Garlico’s financial statements which Xinboda favors is groundless. See Shenzhen Xinboda I, 38 CIT at -, 976 F.Supp.2d at 1367-85 (discussing Xinboda’s surrogate financial statements claim as set forth in greater detail in its Motion for Judgment on Agency Record).

Xinboda’s Complaint next challenges Commerce’s. .calculation of the surrogate wage rate. See Complaint ¶¶ 11, 17-18 (Count II). Specifically, Xinboda contended that Commerce erred in using labor data from-multiple countries in the Final Determination and that Commerce should have relied on Indian data alone; Xinboda further argued that even if it was permissible for Commerce to use data from multiple countries Commerce failed to limit its “basket” of countries to those that were “significant producers” of comparable merchandise and also improperly-excluded India based on the manner in which the country reported its data. See Shenzhen Xinboda I, 38 CIT at —, 976 F.Supp.2d at 1356-67 (discussing Xinboda’s surrogate wage rate claim as set forth in greater detail in its Motion for Judgment on Agency Record).

The third count of Xinboda’s Complaint contests Commerce’s calculation of the surrogate value for whole raw garlic bulbs. See Complaint ¶¶ 12, 19-20 (Count III). Xinboda contends that the Azadpur APMC Market prices' (which are the basis for Commerce’s calculations) do not reflect prices for the “intermediate input” whole raw garlic bulbs that Commerce is supposed to value. According to Xinboda, the Azadpur Market prices are for garlic bulbs at a more advanced, higher level of trade i.e., garlic bulbs that have been subject to additional processing and handling, above and beyond the whole raw garlic bulbs purchased by and delivered to Dadi, Xin-boda’s affiliated processor/producer. Xin-boda also maintains that the Azadpur Market prices include significant sums paid to “middlemen” and “intermediaries.” In addition, Xinboda objects to Commerce’s use of non-contemporaneous Azadpur Market prices for “S.A.”-grade garlic bulbs in calculating the surrogate value for whole raw garlic bulbs. See Shenzhen Xinboda I, 38 CIT at -, 976 F.Supp.2d at 1346-56 (discussing Xinboda’s claim concerning the surrogate value for whole raw garlic bulbs as set forth in greater detail in its Motion for Judgment on Agency Record).

The fourth and final count of Xinboda’s Complaint protests Commerce’s application of the agency’s “zeroing” methodology in calculating Xinboda’s dumping margin. See Complaint, ¶¶ 13, 21-22 (Count IV); Shenzhen Xinboda I, 38 CIT at -, 976 F.Supp.2d at 1385-88 (discussing Xinboda’s zeroing claim as set forth in greater detail in its Motion for Judgment on Agency Record).

Ruling on Xinboda’s Motion for Judgment on the Agency Record, Shenzhen Xinboda I remanded this matter to Commerce for further consideration of all four issues, including a voluntary remand on the surrogate value, for labor (i.e., the surrogate wage rate) at Commerce’s request. See generally Shenzhen Xinboda I, 38 CIT at -, -, 976 F.Supp.2d at 1338, 1388; see also id., 38 CIT at -, -, -, 976 F.Supp.2d at 1353, 1356, 1388 (surrogate value for whole raw garlic bulbs); id., 38 CIT at -, -, -, 976 F.Supp.2d at 1363-64, 1365, 1367, 1388 (surrogate wage rate for labor); id., 38 CIT at -, -, -, 976 F.Supp.2d at 1375-76, 1384-85, 1388 (surrogate financial statements used to derive surrogate financial ratios); id., 38 CIT at -, 976 F.Supp.2d at 1387-88 (application of “zeroing” methodology).

On remand, Commerce revised the surrogate value for labor to be consistent with the agency’s Revised Labor, Methodology and based that value exclusively on labor data for India. See Remand Results at 3, 29, 57. In addition, although the Remand Results continue to rely on Azadpur APMC Market prices in calculating the surrogate value for whole raw garlic bulbs, Commerce adjusted its calculations to deduct freight costs for transportation of garlic from Indian farms to the Azadpur APMC Market. See id. at 3, 8-9, 47-48, 57. Similarly, the Remand Results continue to use the financial statements of Tata Tea to derive súrrógaté financial ratios, with a minor adjustment for the costs associated with tea leaf grown by Tata Tea for its own consumption. See id. at 3, 23-24, 57. Lastly, on remand, Commerce has elucidated the bases for its “zeroing” methodology, but continues to apply that methodology in calculating Xinboda’s dumping margin for purposes of the Remand Results. See id. at 2, 29-44, 55-57.

As a result of Commerce’s actions on remand, Xinboda’s weighted-average dumping margin dropped from $0.06 per kilogram (in the Final Determination) to $0.02 per kilogram (in the Remand Results). See Remand Results at 1, 3.

II. Standard of Review

In reviewing a remand determination in an action challenging an antidump-ing determination by Commerce, the agency’s determination must be upheld except to the extent that it is found to be “unsupported by substantial evidence on the record, or otherwise not in accordance with law.” 19 U.S.C. § 1516a(b)(1)(B)(i); see also NMB Singapore Ltd. v. United States, 557 F.3d 1316, 1319 (Fed. Cir. 2009). Substantial evidence is “more than a mere scintilla”; rather, it is “such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.” Universal Camera Corp. v. Nat’l Labor Relations Bd., 340 U.S. 474, 477, 71 S.Ct. 456, 95 L.Ed. 456 (1951) (quoting Consol. Edison Co. v. Nat’l Labor Relations Bd., 305 U.S. 197, 229, 59 S.Ct. 206, 83 L.Ed. 126 (1938)); see also Dongtai Peak Honey Industry Co. v. United States, 777 F.3d 1343, 1349 (Fed. Cir. 2015) (same).

Moreover, any evaluation of the substantiality of the evidence “must take into account whatever in the record fairly detracts from its weight,” including “contradictory evidence or evidence from which conflicting inferences could be drawn.” Suramerica de Aleaciones Laminadas, C.A. v. United States, 44 F.3d 978, 985 (Fed. Cir. 1994) (quoting Universal Camera Corp., 340 U.S. at 487-88, 71 S.Ct. 456); see also CS Wind Vietnam Co. v. United States, 832 F.3d 1367, 1373 (Fed. Cir. 2016) (same). That said, the mere fact that it may be possible to draw two inconsistent conclusions from the record does not prevent Commerce’s determination from being supported by substantial evidence. Dongtai Peak Honey Industry Co., 777 F.3d at 1349 (citing Consolo v. Federal Maritime Comm’n, 383 U.S. 607, 620, 86 S.Ct. 1018, 16 L.Ed.2d 131 (1966)).

In addition, a remand determination is reviewed for compliance with the court’s remand instructions. Yantai Xinke Steel Structure Co. v. United States, 38 CIT -, -, 2014 WL 1387529 * 2 (2014) (quoting Xinjiamei Furniture (Zhangzhou) Co. v. United States, 38 CIT -, -, 968 F.Supp.2d 1255, 1259 (2014) (internal quotation marks omitted)); Since Hardware (Guangzhou) Co. v. United States, 39 CIT -, -, 49 F.Supp.3d 1268, 1272 (2015) (same); see also Changzhou Wujin Fine Chemical Factory Co. v. United States, 701 F.3d 1367, 1374 (Fed. Cir. 2012) (analyzing on review whether Commerce’s remand results were “within the scope of the Court of International Trade’s remand order” and sustaining the Court of International Trade’s conclusion on that point).

Further, while Commerce must explain the bases for its- decisions, “its explanations do not have to be perfect.” NMB Singapore, 557 F.3d at 1319-20. Commerce’s rationale nevertheless must address the parties’ principal arguments; and, more generally, “the path of Commerce’s decision must be reasonably dis-cernable,” in order to support judicial review. Id. (citing Motor Vehicle Mfrs. Ass’n of the U.S., Inc. v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43, 103 S.Ct. 2856, 77 L.Ed.2d 443 (1983)); see generally 19 U.S.C. § 1677f(i)(3)(A) (requiring Commerce to “include in a final determination ... an explanation of the basis for its determination that addresses relevant arguments, made by interested parties”); CS Wind Vietnam Co., 832 F.3d at 1375-81 (highlighting, and analyzing in depth and detail, agency’s “obligation to set forth a comprehensible and satisfactory justification for its [determination] .... as a reasonable implementation of statutory directives supported by substantial evidence”); Amerijet Int’l, Inc. v. Pistole, 753 F.3d 1343, 1350-52 (D.C. Cir. 2014) (underscoring importance of agency’s obligation to “articulate an explanation for its action,” stating that “a ‘fundamental requirement of administrative law is that an agency set forth its reasons for decision; an agency’s failure to do so constitutes arbitrary and capricious agency action”) (citation omitted).

Lastly, “an agency’s action must be upheld, if at all, on the basis articulated by the agency itself.” State Farm, 463 U.S. at 50, 103 S.Ct. 2856. An, agency’s determination thus cannot be sustained on the basis of a rationale supplied after the fact whether by the agency’s litigation counsel, by another party, or by the court. See Burlington Truck Lines, Inc. v. United States, 371 U.S. 156, 168-69, 83 S.Ct. 239, 9 L.Ed.2d 207 (1962).

III. Analysis

In commencing this action, Xinboda contested four aspects of Commerce’s calculation of Xinboda’s dumping margin in the agency’s Final Determination ie., Commerce’s selection of surrogate financial statements used to derive surrogate financial ratios, Commerce’s calculation of the surrogate value for labor (ie., the surrogate wage rate),'and Commerce’s calculation of-the surrogate value for whole raw garlic bulbs, as well as Commerce’s - application of its “zeroing” methodology in calculating Xinboda’s dumping margin. See generally Complaint; see also Shenzhen Xinboda I, 38 CIT at — , 976 F.Supp.2d at 1345-46.

All four issues were remanded to Commerce in Shenzhen Xinboda I, including a voluntary remand on the surrogate value for labor. See generally Shenzhen Xinboda I, 38 CIT at -, -, 976 F.Supp.2d at 1338, 1388. In the pending Remand Results, Commerce further explained its decisions in the Final Determinations and revised its calculations in several respects.

Xinboda advises that it is satisfied with the Remand Results as to the surrogate value for labor (ie,, the surrogate wage rate), which Commerce has revised to be consistent with its Revised Labor Methodology and which is now based solely on data from India. See Remand Results at 3, 29, 57; Pl.’s Brief at 1 n.1. The Domestic Producers do not object. See Def.-Ints.’ Brief at 2; see also Def.’s Brief at 3. The Remand Results on the surrogate value for labor are also generally in accord with the remand instructions in Shenzhen Xinboda I, 38 CIT at -, -, 976 F.Supp.2d at 1356-67, 1388. Accordingly, Commerce’s Remand Results on the surrogate value for labor (ie., the surrogate wage rate) are sustained. There is no need for further consideration of the issue.

Xinboda similarly approves of Commerce’s decision on remand to exclude the costs of inland freight for the transportation of garlic from Indian farms to the Azadpur APMC Market, in order to eliminate from the surrogate value for whole raw garlic bulbs any “double-counting.” See Remand Results at 3, 8-9, 47-48, 57; Pl.’s Brief at 1 n.1. Once again, the Domestic Producers do not object. See Def.-Ints.’ Brief at 3 n.2; see also Def.’s Brief at 3, 13.

In all other respects, however, including other aspects of the surrogate value for whole raw garlic bulbs, Xinboda maintains that the Remand Results are not supported by substantial evidence and/or are not in accordance with law. Xinboda contends that' the Remand Results therefore cannot be sustained. See Pl’s Brief at 1; Pl’s Reply Brief at 1.

Each of Xinboda’s arguments challenging Commerce’s determinations concerning the surrogate value for whole raw garlic bulbs, the selection of surrogate financial statements for use in calculating surrogate financial ratios, and the application of Commerce’s “zeroing” methodology is addressed in turn below.

A. Surrogate Value for Whole Raw Garlic Bulbs

In calculating the surrogate value for whole raw garlic bulbs, the Remand Results continue to rely on prices for -garlic bulbs sold at the Azadpur APMC Market. See generally Remand Results at 3-14, 44-48. In choosing the Azadpur Market prices over the other potential sources of data on the record of this review (including the Garlico prices that Xinboda favors), Commerce has stated that, compared to the other data sources, the Azadpur Market prices are “much more similar to the inputs being valued.” In addition, Commerce emphasizes that the Azadpur Market prices are size-specific, breaking out prices based on grades of garlic bulbs, including grades Super-A (“S.A.”) and “A.” See Issues & Decision Memorandum at 12-13; Remand Results at 14.

According to the record in this administrative review, “garlic bulb sizes that range from 55 mm and above are Grade Super-A, and garlic bulb sizes that range between 40 mm and 55 mm are Grade A and Grade Super-A.” Preliminary Surrogate Value Memorandum at 4. The Azad-pur APMC’s Market Information Bulletin published prices for grade’ A garlic bulbs for the period of review at issue here. However, the Bulletin ceased reporting prices for grade S.A. garlic bulbs in early February 2008 approximately nine months before the beginning of the period of review. See Issues & Decision Memorandum at 12-13.

The whole raw garlic bulbs that Dadi (Xinboda’s processor/producer) purchased for its production of whole garlic bulbs for Xinboda ranged from 50 to 65 mm in diameter,' and from 50 to 55 mm for Dadi’s production of peeled garlic. To value garlic bulbs with a diameter of 65 mm or more, Commerce relied on non-eontemporaneous Azadpur Market prices for S.A.-grade garlic for the period February 2007 through January 2008, which Commerce then indexed (inflated) to the dates of the period of review using a garlic-specific wholesale price index. See Preliminary Surrogate Value Memorandum at 4; Issues & Decision Memorandum at 12. To value garlic bulbs with a diameter of between 50 mm and 55 mm, Commerce averaged the Azad-pur Market prices for grade S.A. garlic bulbs (as described above) together with contemporaneous Azadpur Market prices for grade A bulbs (i.e., prices for “A”grade garlic from within the period of review). See Final Surrogate Value Memorandum at 1.

Xinboda challenges Commerce’s calculation of the surrogate value for whole raw garlic bulbs on three grounds. Xinboda first argues that the Azadpur Market prices reflect garlic bulbs that are more advanced (are at a higher “level of trade”) compared to the whole raw garlic bulbs that farmers deliver to Dadi, which is the “intermediate input” that Commerce as-sertedly seeks to value. In addition, Xinbo-da maintains that the Azadpur Market prices include substantial “intermediary-expenses” that Dadi did not incur. Lastly, Xinboda contests Commerce’s use of indexed non-contemporaneous Azadpur Market prices for S.A.-grade garlic bulbs, arguing that garlic bulbs of the size and quality previously designated as grade S.A. were subsumed into grade A garlic bulbs as of early February 2008, before the period of review. In other words, Xin-boda contends that the contemporaneous Azadpur Market prices for A-grade garlic bulbs that Commerce is using already reflect prices for garlic bulbs that previously would have been classified as grade S.A. Xinboda thus concludes that Commerce’s use of prices for grade S.A. garlic bulbs from outside the period of review improperly inflates Commerce’s calculated surrogate value for whole raw garlic bulbs.

' Xinboda argues that, in lieu of the Azad-pur Market prices, Commerce should calculate the surrogate value for the whole raw garlic bulbs that farmers delivered to Dadi using averaged garlic price data from the financial statements of the Indian' garlic processor and trader' Garlico, which Xinboda placed on the administrative record. Xinboda contends that Garlico’s experience more closely matches Xinboda’s experience in the purchase of garlic,.

Alternatively, if Commerce is permitted to continue to rely on Azadpur Market prices in calculating the surrogate value for whole raw garlic bulbs, Xinboda argues that Commerce must make an appropriate level of trade adjustment (to account for the fact that the garlic bulbs delivered to Dadi are less processed and handled than the garlic bulbs sold at the Azadpur Market) and must "make any related adjustments to preclude “double-counting”;, that Commerce must deduct- 70% from the Azadpur Market prices to account for expenses attributable’ ;'to intermediaries which are reflected in those prices and which Dadi did not incur;, and that Commerce must use only the contemporaneous prices for grade A garlic bulbs, excluding the prices for grade S.A. '■

1. The Respective Conditions of Dadi’s Garlic Bulbs and Garlic Bulbs Sold at the Azadpur APMC Market & Xiribo-da’s Claim of “Double-Counting”

As it did in the Final Determination, ' Commerce co'ntinues to (in effect) equate the’ condition of the whole raw garlic bulbs that farmers delivered to Dadi with the- condition of the garlic bulbs sold at the Azadpur APMC-Market. See, e.g., Remand Results at 11-12 (stating that, on remand. Commerce “continues to find ... [that] the Azadpur [Market] garlic prices ... are reasonably reflective of the raw garlic inputs [that were delivered to Dadi]”); id. at 11 (arguing that the Azad-pur Market prices atid the prices that Dadi paid to farmers “are reasonably similar in nature”); id. (asserting that there is no evidence that “the prices paid by [Dadi] and the Azadpur [Market] net prices ... are fundamentally different”); see generally Def.’s Brief at 10, 15; Def.-Ints.’ Brief at 5-6. But Commerce’s determination is squarely at odds with the existing record.

The Condition of Garlic Bulbs at the Azadpur APMC Market. The sole record evidence that speaks directly to the condition of the garlic bulbs sold at the Azadpur APMC Market is a declaration under oath, proffered by Xinboda, in which a researcher/consultant based in India attests to his first-hand findings and observations based on a visit that he made to the Azadpur Market. See generally Declaration of Xinboda Research Consultant, “Survey of Garlic Offerings Azadpur Market, New Delhi” (“Researcher Declaration”) (Pub. Doc. No. 138); see also PL’s Brief at 8-11; PL’s Reply Brief at 4. The Researcher Declaration addresses a handful of basic but pivotal points.

As to the condition of the garlic bulbs at the Azadpur APMC Market, the Researcher Declaration states, in relevant part, that “[t]he garlic sold in the Azadpur Market is ready for retail consumption and is already fully processed when it arrives there, as in: (1) taking off the outside dirty layers so the garlic has a fresh white appearance; (2) cutting any long stems; and (3) paek-aged in a mesh bag.” Researcher Declaration ¶ 9. The Researcher Declaration further states that “[t]he garlic is ready to be consumed in the state it is sold in the Azadpur Market.” Id.

Significantly, neither Commerce nor the Domestic Producers point to any record evidence to controvert the facts set forth in the Researcher Declaration. Instead, they attempt to discredit it and reject it in its entirety. See Remand Results at 11 (asserting a lack of “credible evidence” to refute Commerce’s conclusion that the price paid by Dadi and the Azadpur APMC Market prices are “reasonably similar”); id. at 46-47 (characterizing Researcher Declaration as “not reliable” and asserting that “there is no reliable information on the record indicating the exact nature of the Azadpur surrogate input or the exact steps Indian farmers might take before sending their products to [the Azad-pur Market]”); see also Def.’s Brief at 16-17; Def.-Ints,’ Brief at 15-19.

Quoting verbatim from Commerce’s Issues and Decision Memorandum in the sixteenth administrative review (ie., the review following the administrative review at issue here), the Remand Results state:

As an initial matter, it is not clear whether Xinboda’s “Indian researcher” was a market researcher or Reid expert; the individual reports having worked in “import/export trade for over 20 years.” Moreover, the individual who provided this Researcher Declaration made a number of observations based on a single visit to the Azadpur Market on January 31, 2011 during which eight vendors were interviewed. These observations [documented in the Researcher Declaration] included discussions of the sizes of the garlic sold, the grading system for the garlic, and the market readiness of the garlic sold in Azadpur. While the researcher states that all observations are “[b]ased on research and my discussions with vendors,” [Commerce] has not been presented with any research conducted by this individual, nor has any information regarding the vendors (i.e., name, time selling at the market, etc.) been provided to corroborate what the Researcher Declaration actually reports. Finally, the signature date (February 2, 2011) does not match the date of the notary public’s signature. While this may not be a primary concern, the discrepancy between the date the document was signed and the date the notary public signed, nonetheless, raises additional questions about the Researcher Declaration. Although the affidavit appears to have been drafted and notarized in 2011, it is unclear why it also contains a stamp date of 2010. The lack of supporting documentation and, for that matter, even information on the “researcher” as well as the discrepancy in when the document was signed, make it impossible for [Commerce] to consider the Researcher Declaration a reliable source of information upon which we may base our. conclusions.

Remand Results at 5-6 (quoting Issues and Decision Memorandum for Fresh Garlic from the People’s Republic of China: Final Results of the 2009-2010 Administrative Review at 20 (“Issues & Decision Memorandum for 16th Review”)).

Commerce further states that “the Researcher Declaration is a two-page set of statements with no documentation provided to supports its conclusions and no details provided by the ‘researcher’ regarding the methods or steps he took to reach his conclusions beyond noting that he interviewed ‘every1 merchant of garlic on the day he visited.” Remand Results at 6. Commerce continues: “The researcher provides no indication of having met with those responsible for gathering and publishing [the Azadpur APMC prices] (which is an especially relevant problem ... related to the issue ... concerning why the [Azadpur APMC’s Market Information Bulletin] no longer publishes prices for grade Super-A raw garlic bulbs.” Id.; see generally Def.’s Brief at 16-17 (arguing that Researcher Declaration was properly found to be unreliable); Def.-Ints.’ Brief at 2-3,15-19 (same). But see Pl.’s Brief at 8-13 (defending reliability of Researcher Declaration); Pl.’s Reply Brief at 4-6 (same).

Commerce concedes that, “in certain contexts, [the Researcher Declaration] would be sufficient for [Commerce’s] purposes.” Remand Results at 6. Nevertheless, Commerce ultimately rejects the Declaration as “not reliable.” Id

A clear-eyed, objective, and dispassionate examination of the Researcher Declaration and each of Commerce’s criticisms leads to a different conclusion. As summarized below, Commerce’s critique of the Declaration is wide of the mark. ■

For example, the length of the Researcher Declaration whether two pages or two hundred has no bearing on the veracity of the statements made in the Declaration. Such declarations and similar reports and other documents need not be any longer than is necessary to fulfill their purpose. There is no magic number of pages. Here, the two-page Declaration is confined to a few basic factual matters at issue in this administrative review and addresses them at an adequate level of detail. Commerce’s criticism of the length of the Researcher Declaration thus lacks a rational basis.

Similarly lacking in merit is Commerce’s complaint that the Researcher Declaration does not indicate whether the researcher is “a market researcher or [a] field expert,” as well as Commerce’s broadbrush complaint that the Declaration lacks “information on the ‘researcher.’” See Remand Results,at 4. Given the straightforward nature of the, facts set.forth in the Declaration, the Researcher’s background whether he is a “market researcher” or a “field expert” or has some other title and sub-specialty is of no moment. The Researcher is not being proffered as an “expert witness” and the statements made in the Declaration do not require any special expertise. Given the nature of the information provided in, the document, the credence to be accorded, the Researcher Declaration is the same, -without regard to whether the Researcher had (or did not have) any particular background or expertise.

Commerce’s observation that the Researcher Declaration is based on a “single visit” to the Azadpur APMC Market also is lacking in substance. See Remand Results at 4. The record is devoid of any evidence indicating that additional visits to the Market would have affected the facts set forth in the Researcher Declaration in any way, as Commerce-seems to suggest.

In like manner, Commerce appears to fault the Researcher Declaration because it is based in part on interviews of eight garlic vendors. See Remand Results at 4. As Commerce acknowledges, however, the Declaration attests that the Researcher “interviewed ‘ever/ merchant of garlic” present at the Azadpur APMC Market on the day of his visit not a survey of a sample of garlic vendors, but, rather, interviews with 100% of, the garlic vendors at the Market. See id. at 5; Researcher Declaration ¶ 2. There is no record basis for any implication that additional visits to the Market, which might (or might not) have included interviews of additional vendors, would have altered the statements set forth in the Researcher Declaration.

■ Commerce further discounts the Researcher Declaration, asserting that it provides “no details .., regarding the methods or steps [the Researcher] took to reach his conclusions.” See Remand Results at 5. Commerce’s point here is, again, misguided. The text of the Declaration itself discloses that the Researcher personally visited the Azadpur. APMC Market, interviewed all eight of the garlic vendors at the Market, personally observed the garlic bulbs that were offered for sale, and took six photographs of those garlic bulbs (Grades A, B, and C). See generally Researcher Declaration & Exhs. 1-3 (photos of garlic bulbs, measured against ruler in order to establish scale) (AR Pub. Doc. Nos. 138-39). The Researcher’s simple, basic “methodology,” as evidenced by the Declaration, was appropriate and proportional to the purpose and nature of his inquiry and to the facts in question.

In addition, Commerce seeks to make much of the Researcher’s statement that the observations documented in the Declaration are “[biased on research and ... discussions with vendors.” See Remand Results at 5 (quoting Researcher Declaration ¶ 2). Underscoring that statement, Commerce indicates that the agency has not been provided with “any research conducted by [the Researcher]” and that the agency has received “[n]o documentation ... to support [the Declaration’s] conclusions.” See Remand Results at 4; see also id. (criticizing Researcher Declaration for “lack of supporting documentation”); id. at 5 (stating that “no documentation [is] provided to support” the Declaration’s statements). However, it appears' that Commerce simply reads too much into the Declaration’s generalized reference to “research” (which, in context, seems to refer broadly to the Researcher’s visit to the Market). There is nothing to indicate that “research” and. - “supporting documentation” exist but were not provided to the agency. Even .more to the point, in light of the basic nature of the' content .of the Researcher..Declaration and the straightforward facts set forth therein, there was no need for “research” beyond the inquiry described in the Declaration. Nor is there any need for back-up “documentation.”

In particular, Commerce disparages the Researcher Declaration because it does not provide-certain information i.e., their names and how long they have'.worked at the Azadpur APMC Market -for the eight garlic vendors who were interviewed. Remand Results at 5. Like the rother criticisms that Commerce has leveled at the Declaration, this -point initially may have a certain superficial 'appeal, but it does not bear up under close scrutiny. The vendors’ names are of no moment in this ■ context, and the duration of their employment is not important here, provided that the vendors have..knowledge of the very basic information that they provided to the Researcher and the record is devoid of any evidence to suggest that, in fact, they lacked such knowledge. .

Moreover, realistically, there can be no serious claim -that, if their names and other information about the vendors were provided, Commerce or the Domestic Producers would undertake to investigate the vendors in an effort to impeach the Declaration’s credibility. Speaking practically, given the nature of the very basic factual information provided in the Researcher Declaration, it would be not only inefficient but largely pointless to probe the educational backgrounds arid work experience of the vendors, and to run background checks on them. Even if an investigation were to identify some anomaly as to one or more of the vendors, any showing of minimal formal education, limited work experience, and/or a criminal record (for example) would have no real effect as to the statements in the Researcher Declaration and would, be collateral to the central issues at hand.

In other words/the fact remains that it is either true or false that the garlic arriving for sale at the Azadpur APMC Market has had all “long stems” cut and “the outside dirty layers” removed, “so the garlic has a fresh white appearance” (see Researcher Declaration ¶9), without regard to the individual credibility of any or all of the eight garlic vendors. To adequately and effectively refute the straightforward statements in the Researcher Declaration, evidence to that effect must be placed on the record. In the specific circumstances of this case, and in light of the wholly factual nature of the points made in the Researcher Declaration, it is of little practical consequence that the Researcher -Declaration does not specify the names and employment histories of the eight garlic vendors who were interviewed.

Lastly, Commerce points to what it refers to as “date inaccuracies” in the Declaration. See Remand Results at 5. In particular, Commerce focuses on an asserted “discrepancy in when the [Researcher Declaration] was signed,” noting that “the signature date (February 2, 2011) does not match the date of the notary public’s signature.” See id. at 4; see also id. at 5 n.11. In addition, Commerce states that, “[although the [Declaration] appears to have been drafted and notarized in 2011, it is unclear why it also contains a stamp date of 2010.” See id. at 4.

Commerce does not even acknowledge much less attempt to refute Xinboda’s explanation of the 2010 date that appears on the face of the Declaration (“Certified Stamp L.S.V. No. 694 20 April 2010 Proper Officer”), even though that explanation appeared in Xinboda’s comments ori the Draft Remand Results. Xinboda advises that the 2010 date is the date on which the Licensed Stamp Vendor (“L.S.V.”) in India sold the official “non-judicial stamp paper” on which the Declaration is printed. Compare Xinboda Comments on Draft Remand Determination at 4 n.3 (explaining April 2010 date) (SAR Pub. Doc. No. 6) and Pl.’s Brief at 10 n.4 (same) with Remand Results at 4 (contrasting 2010 stamp date on Declaration with 2011 date of signature and notarization). And, as to the slight difference between the Declaration’s signature date and the date of the notary’s signature, Commerce concedes that the difference is “not ... a primary concern” for the agency. See Remand Results at 4.

In sum, Commerce’s criticisms of the Researcher Declaration are largely without merit, and the agency’s sweeping, wholesale dismissal of the Declaration is unwarranted. Under the “substantial evidence” standard and the circumstances, of this case, Commerce here is not free to disregard the only specific, relevant, concrete record evidence concerning the condition of the garlic bulbs sold at the Azad-pur APMC Market ie., the evidence that “[t]he garlic sold in the Azadpur Market is ready for retail consumption and is already fully processed when it arrives there, as in: (1) taking off the outside dirty layers so the garlic has a fresh white appearance; (2) cutting any long stems; and (3) packaged in a mesh bag” and the evidence that the garlic bulbs sold at the Market are “ready to be consumed in the state [in which they are] sold.” See Researcher Declaration ¶ 9.

The Condition of Garlic Bulbs Delivered to Dadi. Much as Commerce has stated that it does not know key specifics concerning the basic condition of the garlic bulbs sold at the Azadpur APMC Market, so too Commerce states that it does not know the basic condition of the garlic bulbs that pm-chased by and delivered to Dadi. See Remand Results at 46 (stating that Commerce “does not have reliable information describing in detail the physical characteristics of the surrogate product [ie., here, the garlic bulbs sold at the Azadpur Market]. Thus, [Commerce] cannot know exactly how the actual input [ie., the garlic bulbs purchased by Dadi] and the surrogate input [ie., the garlic bulbs sold at the Azadpur Market] differ.”); see also supra n.12. The Remand Results nevertheless essentially equate the two, asserting that both- have undergone post-harvest processing. See Remand Results at 47 (stating that Commerce finds that both the actual input [i e,, the garlic bulbs delivered to Dadi] and the surrogate input for raw garlic [i.e., the garlic bulbs sold at the Azadpur APMC. Market] are processed beyond the ‘farm gate’ to .some extent”). In particular, Commerce emphasizes that pri- or to delivery to Dadi for processing the garlic bulbs that Dadi purchased had been “sorted by grade/size, cleaned, bagged, [and] stored,” sometimes in cold or Controlled atmosphere storage. See Remand Results at 6-7 (quoting Issues & Decision Memorandum for 16th Review). See id

Contrary to Commerce’s implication, however, Xinboda has never denied that farmers supplying garlic bulbs to Dadi “provide[d] rudimentary services such as cleaning, removing stems and root parts, sorting, and bagging for transport,” and that, in some instances, bulbs were held in cold storage prior to delivery. PL’s Brief at 3, 6, 7-8. But, more to the point, the record evidence on the condition of the garlic bulbs delivered to Dadi belies any suggestion that their condition and the condition of the garlic bulbs sold at the Azadpur APMC Market were essentially the same.

As detailed above, the Researcher Declaration the only record evidence on point states that the garlic bulbs at the Azadpur APMC Market have already had the “long stems” and “outside dirty layers” removed, leaving the bulbs with “a fresh white appearance.” Researcher Declaration ¶ 9. However, the record evidence establishes that these same processes peeling away the outside layers of the garlic bulbs, cutting their roots and long stems, and so on are processes that Dadi’s workers performed at Dadi’s own processing facilities. See Shenzhen Xinboda I, 38 CIT at -, 976 F.Supp.2d at 1349. In the Verification Report, Commerce staffers noted their own first-hand, eyewitness observations to that effect: “[Dadi’s] production process includes peeling off outer skins, cutting root and stem, the utilization of mesh bags when required by order, buckling the bag, and then placing it in a cardboard box.” See Verification of the Sales and Factors Responses of Shenzhen Xinboda Industrial Co., Ltd. in the Administrative Review of Fresh Garlic from the People’s Republic of China at 9 (“Verification Report”) (AR Pub. Doc. No. 151).

Logically, the processing that was performed at Dadi’s facilities was by definition over and above any operations that may have occurred before the garlic bulbs were delivered to Dadi. Moreover, as a matter of logic, because Dadi’s workers peeled off the outer skins of the garlic bulbs and cut their roots and stems, the garlic bulbs that were delivered to Dadi could not possibly have been in the same condition as those sold at the Azadpur APMC Market. At the Azadpur Market, the “long stems” of the garlic bulbs already had been cut off and the “outside dirty layers” of the bulbs already had been removed, leaving the garlic bulbs with “a fresh white appearance.” Compare Verification Report at 9 with Researcher Declaration ¶ 9.

The Consequences for Commerce’s Analyses. If the garlic bulbs sold at the Azadpur APMC Market were at a more advanced level of trade (ie., had been subjected to more processing) than the garlic bulbs that were delivered to Dadi (as all existing record evidence indicates), the Azadpur Market prices cannot reasonably be used as a surrogate value for the garlic bulbs that were delivered to Dadi at least not without further adjustment.

As orle example, Xinboda has explained that it was required to report to Commerce the labor hours and the electricity that Dadi workers consumed in tasks such as stripping off the outside layers of the garlic bulbs' and cutting the roots and stems, and that Commerce then added the value of that labor and electricity together with a proportional figure for overhead (specifically,- selling, general, and administrative expenses or “SG & A”) to Commerce’s calculated surrogate value for whole raw garlic bulbs, ie., .the Azadpur Market prices. Because Commerce separately accounted for such expenses, and because the expense of such processes is already effectively “embedded” in the Azadpur Market prices, Commerce’s calculations reflect impermissible double-counting. See Shenzhen Xinboda I, 38 CIT at —, 976 F.Supp.2d at 1349.

This matter therefore must be remanded to Commerce for a second time, to allow the agency to once again reconsider its selection of a surrogate value for the “intermediate input” in question ie., the whole raw garlic bulbs that were purchased by and delivered, to Dadi taking into account the analysis herein, as well as all arguments and all record evidence. In its reconsideration, Commerce shall make any adjustments to the surrogate valué that Commerce selects which may be necessary in order to avoid the double-counting of expenses and to otherwise calculate Dadi’s dumping margin as accurately as possible. See also infra sections III.A.2 & III.A.3 (analyzing, respectively, Xinboda’s related claim that the Azadpur Market prices reflect expenses associated with intermediaries that are not incurred by Dadi, and Xinboda’s related claim that Commerce’s use of Azadpur Market prices for grade S.A. garlic bulbs skewed the agency’s surrogate value).

2. Expenses Associated With “Intermediaries”

Apart from Xinboda’s challenge to Commerce’s determination that the. condition of the garlic bulbs delivered to Dadi and the condition of those. sold at the Azadpur APMC Market are essentially the same and Xinboda’s “double-counting” claim (discussed above), Xinboda also contends that the Azadpur Market prices reflect substantial “intermediary” expenses that is, fees and downstream expenses, such as sums paid to “middlemen”., and “intermediaries” including “commission agents, wholesalers, and retailers” which are expenses that Dadi did not incur and which impermissibly inflate the surrogate value that Commerce has calculated for the intermediate input at issue here (ie., the garlic bulbs that were delivered to Dadi). Pl.’s Brief at 6; see generally Shenzhen Xinboda I, 38 CIT at -, 976 F.Supp.2d at 1350-53 (addressing. Xinbo-da’s claims concerning sums paid to “mid-die men” and “intermediaries,” including “commission agents, wholesalers and retailers to cover transportation, loading, unloading, storage, overhead, profits, etc.,” which, according to Xinboda, are associated with sales at markets such as the Azad-pur Market).

The Remand Results make the point that Commerce has already deducted 7% from the Azadpur Market prices “in prder to account .for commissions,” including “middleman type expenses” associated with “services typically rendered by a sales age