Nies, Judge.
This appeal is from the judgment of the United States Customs Court (now the United States Court of International Trade), 85 [86]*86Cust. Ct. 50, C.D. 4868, 506 F. Supp. 647 (1980), which held that appellee had shown error in the basis used by the Government to appraise cucumbers in brine imported by appellee from Mexico and, further, had proved and “export value” 1 for the imported merchandise based on prices paid independent farmers in Mexico for fresh cucumbers plus packing costs. Costs incurred from immersion in brine during shipment were treated as part of appellee’s packing cost. We reverse.
Background
This case is the second case decided by the court below concerning the appraisement of pickle-type cucumbers 2 imported from Mexico in brine by Arnold Pickle & Olive Co. (Arnold). In the first case, Arnold Pickle & Olive Co. v. United States, 75 Cust. Ct. 154, C.D. 4620 (1975), (hereinafter referred to as Pickle I) seven entries of such cucumbers, imported in May 1971, were involved. In this case 100 entries, made over a seven month period in 1971, are at issue.3
In Pickle I the court held that an “export value” based on the price at which sales were make to Arnold by a Mexican company, Pickle-Mex, presumed to have been the basis for evaluating the goods used by the appraiser, was erroneous. Pickle-Mex was found to have acted as an agent or alter ego for Arnold,4 purchasing goods for Arnold in Mexico and preparing them for shipment. Thus, despite invoices showing sales prices, the court found no bona fide sales between the two companies. The Government then argued that the only other appropriate basis for determining an “export value” was a sale of cucumbers in brine to a third party by Pickle-Mex, but because there was only a single sale the court was not persuaded that it should serve as an export value. The court adopted Arnold’s [87]*87view that § 402(b)5 allowed an “export value” to be based on the price at which independent farmers sold fresh cucumbers to Pickle-Mex plus cost of packing them for shipment, which included the cost of immersion in brine, rejecting the Government’s argument that this approach was a distortion of “export value” into “constructed value.” 6
The immersion process was effected by loading the cucumbers together with water and salt (and in some instances also ice) into a polyethylene liner in a truck. The court found that the “method of transportation did not advance the cucumbers towards 'pickleness’ but did increase their salt content.” (75 Cust. Ct. at 157.) The court concluded:
When a particular type of packing is named in the tariff description I consider it a proper interpretation of section 402(b) to allow proof of the cost of packing as an addition to the export price of the basic article even though as a strictly technical matter the merchandise undergoing appraisement is the combination of basic article and packing. I see this as a lesser anomaly than the alternative conclusion that an article which in all other respects has an export pricé cannot have an export value because it is packed for export by a party which does not sell it for export. Thus, overriding considerations of fairness would lead me, in the present circumstances, to find an export value in the export price of the cucumbers plus the cost of their packing. [75 Cust. Ct. at 157.]
While appellee was thus successful in theory, nevertheless, it lost the battle. A plaintiff challenging appraisement not only must show that the Government was wrong, but also must prove the correct value. By failing to submit proof of inspecting and grading costs, part of the readying and packing costs, Arnold did not prove the export value it claimed, and the appraised value remained in effect.
Arnold did not appeal that judgment and the Government was not in a position to do so. Arnold then instituted this action and concurrently filed a motion for partial summary judgment on the ground that the basis for valuation was established in Pickle I. The Government countered by moving for judgment on the pleadings, asserting [88]*88that Pickle I created a collateral estoppel which precluded appellee from relitigating appraisement of the same type of merchandise.
The court granted Arnold’s motion for partial summary judgment (Arnold Pickle & Olive Co. v. United States, 79 Cust. Ct. 50, C.D. 4712 (1977)); the record of Pickle I was incorporated on appellee’s motion; and all costs established in the first case were carried forward. Only the costs of inspection and grading, the missing elements of proof in the first case, required proof in the second trial.
The Government’s motion for judgment on the pleadings was denied. The court did not consider the judgment against Arnold in Pickle I a proper basis for estoppel in this case inasmuch as there was no “precise determination in [the Government’s] favor on the issue of valuation”.
At the trial, the court determined that this time Arnold proved its total packing costs and that the claimed export value was thus fully established. Judgment was entered for Arnold.
The Government advances three rounds for reversal: (1) the price of fresh cucumbers does not constitute an “export value” exclusive of packing costs within the meaning of § 402(b) for cucumbers in brine; (2) appellee is precluded by principles of collateral estoppel from relitigating correct export values for the same type of merchandise considered in Pickle 7; and (3) in any event, appellee failed to prove the costs of packing.
Because the first ground necessitates reversal, we do not reach the other issues.
OPINION
A dual burden of proof is imposed on one challenging the validity of the valuation at which imported merchandise has been appraised. The challenger must not only overcome the presumption of correctness attaching to the appraised value but also must establish the correctness of the alternative value being proposed.7 Dana Perfume Corp. v. United States, 63 CCPA 43, 524 F. 2d 750 (1975); H. S. Dorf & Co. v. United States, 41 CCPA 183, C.A.D. 548 (1954). In this case Arnold must show (1) that “sales” between Arnold and Pickle-Mex do not provide an “export value” within the meaning of § 402(b) and (2) that an “export value” may properly be based on sales of fresh cucumbers, as asserted.
The amount of duty on appellee’s imported merchandise is fixed by a rate determined by the classification under which the merchandise falls, that rate then being applied to the “value” of the merchandise, that is, its appraisement. This case presents only an appraisement [89]*89question since neither party questions classification. Nevertheless, as an initial matter, it is appropriate to clarify the identification of the merchandise for classification purposes. Vegetables covered by item 141.75, TSUS, are “Other: Packed in salt, in brine, or pickled.” The court below and the parties have referred to this item as covering “vegetables, -packed in brine.” [Emphasis added.] However, this reading of the statute is incorrect.
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Nies, Judge.
This appeal is from the judgment of the United States Customs Court (now the United States Court of International Trade), 85 [86]*86Cust. Ct. 50, C.D. 4868, 506 F. Supp. 647 (1980), which held that appellee had shown error in the basis used by the Government to appraise cucumbers in brine imported by appellee from Mexico and, further, had proved and “export value” 1 for the imported merchandise based on prices paid independent farmers in Mexico for fresh cucumbers plus packing costs. Costs incurred from immersion in brine during shipment were treated as part of appellee’s packing cost. We reverse.
Background
This case is the second case decided by the court below concerning the appraisement of pickle-type cucumbers 2 imported from Mexico in brine by Arnold Pickle & Olive Co. (Arnold). In the first case, Arnold Pickle & Olive Co. v. United States, 75 Cust. Ct. 154, C.D. 4620 (1975), (hereinafter referred to as Pickle I) seven entries of such cucumbers, imported in May 1971, were involved. In this case 100 entries, made over a seven month period in 1971, are at issue.3
In Pickle I the court held that an “export value” based on the price at which sales were make to Arnold by a Mexican company, Pickle-Mex, presumed to have been the basis for evaluating the goods used by the appraiser, was erroneous. Pickle-Mex was found to have acted as an agent or alter ego for Arnold,4 purchasing goods for Arnold in Mexico and preparing them for shipment. Thus, despite invoices showing sales prices, the court found no bona fide sales between the two companies. The Government then argued that the only other appropriate basis for determining an “export value” was a sale of cucumbers in brine to a third party by Pickle-Mex, but because there was only a single sale the court was not persuaded that it should serve as an export value. The court adopted Arnold’s [87]*87view that § 402(b)5 allowed an “export value” to be based on the price at which independent farmers sold fresh cucumbers to Pickle-Mex plus cost of packing them for shipment, which included the cost of immersion in brine, rejecting the Government’s argument that this approach was a distortion of “export value” into “constructed value.” 6
The immersion process was effected by loading the cucumbers together with water and salt (and in some instances also ice) into a polyethylene liner in a truck. The court found that the “method of transportation did not advance the cucumbers towards 'pickleness’ but did increase their salt content.” (75 Cust. Ct. at 157.) The court concluded:
When a particular type of packing is named in the tariff description I consider it a proper interpretation of section 402(b) to allow proof of the cost of packing as an addition to the export price of the basic article even though as a strictly technical matter the merchandise undergoing appraisement is the combination of basic article and packing. I see this as a lesser anomaly than the alternative conclusion that an article which in all other respects has an export pricé cannot have an export value because it is packed for export by a party which does not sell it for export. Thus, overriding considerations of fairness would lead me, in the present circumstances, to find an export value in the export price of the cucumbers plus the cost of their packing. [75 Cust. Ct. at 157.]
While appellee was thus successful in theory, nevertheless, it lost the battle. A plaintiff challenging appraisement not only must show that the Government was wrong, but also must prove the correct value. By failing to submit proof of inspecting and grading costs, part of the readying and packing costs, Arnold did not prove the export value it claimed, and the appraised value remained in effect.
Arnold did not appeal that judgment and the Government was not in a position to do so. Arnold then instituted this action and concurrently filed a motion for partial summary judgment on the ground that the basis for valuation was established in Pickle I. The Government countered by moving for judgment on the pleadings, asserting [88]*88that Pickle I created a collateral estoppel which precluded appellee from relitigating appraisement of the same type of merchandise.
The court granted Arnold’s motion for partial summary judgment (Arnold Pickle & Olive Co. v. United States, 79 Cust. Ct. 50, C.D. 4712 (1977)); the record of Pickle I was incorporated on appellee’s motion; and all costs established in the first case were carried forward. Only the costs of inspection and grading, the missing elements of proof in the first case, required proof in the second trial.
The Government’s motion for judgment on the pleadings was denied. The court did not consider the judgment against Arnold in Pickle I a proper basis for estoppel in this case inasmuch as there was no “precise determination in [the Government’s] favor on the issue of valuation”.
At the trial, the court determined that this time Arnold proved its total packing costs and that the claimed export value was thus fully established. Judgment was entered for Arnold.
The Government advances three rounds for reversal: (1) the price of fresh cucumbers does not constitute an “export value” exclusive of packing costs within the meaning of § 402(b) for cucumbers in brine; (2) appellee is precluded by principles of collateral estoppel from relitigating correct export values for the same type of merchandise considered in Pickle 7; and (3) in any event, appellee failed to prove the costs of packing.
Because the first ground necessitates reversal, we do not reach the other issues.
OPINION
A dual burden of proof is imposed on one challenging the validity of the valuation at which imported merchandise has been appraised. The challenger must not only overcome the presumption of correctness attaching to the appraised value but also must establish the correctness of the alternative value being proposed.7 Dana Perfume Corp. v. United States, 63 CCPA 43, 524 F. 2d 750 (1975); H. S. Dorf & Co. v. United States, 41 CCPA 183, C.A.D. 548 (1954). In this case Arnold must show (1) that “sales” between Arnold and Pickle-Mex do not provide an “export value” within the meaning of § 402(b) and (2) that an “export value” may properly be based on sales of fresh cucumbers, as asserted.
The amount of duty on appellee’s imported merchandise is fixed by a rate determined by the classification under which the merchandise falls, that rate then being applied to the “value” of the merchandise, that is, its appraisement. This case presents only an appraisement [89]*89question since neither party questions classification. Nevertheless, as an initial matter, it is appropriate to clarify the identification of the merchandise for classification purposes. Vegetables covered by item 141.75, TSUS, are “Other: Packed in salt, in brine, or pickled.” The court below and the parties have referred to this item as covering “vegetables, -packed in brine.” [Emphasis added.] However, this reading of the statute is incorrect. The words “in brine” are not appended to the word “packed.” “Packed in salt,” “in brine,” and “pickled” are the three categories in item 141.75, TSUS. Thus, the goods here are “Vegetables, Other, * * * in brine,” and appellee’s goods will he referred to herein, where appropriate, as “cucumbers in brine.”8
“imported merchandise” under section 402(b)
Section 402(b) provides (in pertinent part) that “the export value of imported merchandise shall be the price * * * at which such or similar merchandise is freely sold * * * ” [emphasis added]9 plus the costs of readying the goods for shipment, if not included. Valuation under § 402(b) is a multi-step process, the first step being to determine what the “imported merchandise” is. Only after this question is answered are we in a position to decide whether there is an export value for the goods based on sales of such or similar merchandise.10
Appellee maintains, and the court below agreed, that the basic article imported (i.e., the “imported merchandise”) is pickle-type cucumbers, the particular packing being immaterial. This position focuses on the evidence that pickle-type cucumbers, whether shipped in brine or not, are used for the same purpose after importation and are processed into pickles in the same way.
The Government, on the other hand, argues that immersion in brine alters the physical condition of the cucumbers. At the time of importation, therefore, the goods were no longer fresh cucumbers. Accordingly, the Government contends the court below erred in its holding that fresh cucumbers were the basic article imported.
It is well settled that the condition of merchandise at the moment of importation establishes the basis for appraisement, that is, deter[90]*90mines what the “imported merchandise” is under § 402(b). United States v. Joseph Fischer, 32 CCPA 62, 67, C.A.D. 286 (1944).
In E. R. Squibb & Sons v. United States, 28 Cust. Ct. 560, R.D. 8094 (1952), aff'd 31 Cust. Ct. 445, A.R.D. 29 (1953), aff'd 42 CCPA 23, C.A.D. 564 (1954), which raised a similar issue of what was the condition of the goods as imported, new drums had been filled with cod liver oil and were imported containing the oil. Although the contents entered free, the drums were separately subject to duty and, thus, separately appraised. The Government sought to appraise them as new drums. It was held that having been filled with oil, the drums no longer were new or unused at the time of importation and should have been appraised on the basis of the value for drums in their condition as imported, i.e., used drums.
Appellee cites United States v. Arkell Safety Bag Co., 22 CCPA 258, T.D. 47210 (1934) for the proposition that a method of packing, in that case paper on different size rolls, did not change the merchandise into a different article. The article imported was held to be paper.
We do not find these authorities in conflict. The determinative factor in each case was the physical condition of the merchandise. On the facts of this case we must agree with the Government that the “imported merchandise” is cucumbers in brine, not fresh cucumbers. [4] Brining results in a permanently changed condition of the vegetables themselves. Appellee does not dispute that the salt content of the cucumbers was increased, as found by the court. Indeed, it was appellee’s witness who testified that some of the salt from the brine is absorbed by the cucumbers. Thus, fresh cucumbers, once immersed in brine, are not thereafter in the condition of being “fresh” and cannot again become fresh by discarding the brine. The “packing” to some extent becomes a component of the imported article.
Congress has, we believe, recognized the physically different conditions of fresh vegetables and vegetables in brine in the classification schedule. By seeking classification as “in brine” appellee has acknowledged that its imported merchandise is physically different from fresh cucumbers. It is only by the addition of the brining that the goods take on their basic character. Fresh cucumbers, therefore, are not the “imported merchandise,” freshness not being the condition of the goods at importation.
Appellee’s further argument that fresh cucumbers and cucumbers in brine are not “dissimilar” goods is irrelevant to determining what is the “imported merchandise.” While the statute provides that an “export value” may in some circumstances be based on the selling price of “similar” merchandise, that does not change the initial question. It must be determined what the imported merchandise is inasmuch as the various bases set forth in the statute for determining [91]*91“export value” must be considered seriatim. If there is a price for identical goods, export value cannot be based on the price for similar merchandise.
Imported merchandise in § 402(b) means the goods actually imported, not similar goods. In this case the imported merchandise is cucumbers in brine.
“SUCH OR SIMILAR MERCHANDISE” UNDER SECTION 402(b)
Having determined that the imported merchandise is cucumbers in brine does not end our inquiry. Even though the price at which independent farmers sold fresh cucumbers is not a price for the “imported merchandise,” appellee would be entitled to prevail if the price paid for fresh cucumbers is for “similar” goods and if there is no selling price for cucumbers in brine which must be given precedence as an export value.
In this connection we must look to the definitions of “such or similar merchandise” provided in § 402(f)(4), (19 U.S.C. 1401a(f) (4)):
(4) The term “such or similar merchandise” means merchandise in the first of the following categories in respect of which export value * * * can be satisfactorily determined:
(A) The merchandise undergoing appraisement and other merchandise which is identical in physical characteristics with, and was produced in the same country by the same person as, the merchandise undergoing appraisement.
(B) Merchandise which is identical m physical characteristics with, and was produced by another person in the same country as, the merchandise undergoing appraisement.
(C) Merchandise (i) produced in the same country and by the same person as the merchandise undergoing appraisement, (ii) like the merchandise undergoing appraisement in component material or materials and in the purposes for which used, and (iii) approximately equal in commercial value to the merchandise undergoing appraisement.
(D) Merchandise which satisfies all the requirements of subdivision (C) except that it was produced by another person.
The Government argues that the sales of cucumbers in brine by Pickle-Mex to Arnold provides an export value for the “merchandise undergoing appraisement,” the first category above, and asks that we overturn the finding of the court below that there were no bona fide sales between these parties. However, there is substantial evidence in the record for this finding by the court.11 Thus, appellee has established that this basis for appraisement, presumably the basis used by the appraiser, was incorrect.
The Government further asserts that the court erred in next rejecting the price at which Pickle-Mex sold a single shipment of cucum[92]*92bers in brine to an unrelated third party. Such goods would clearly fall within the description “other merchandise which is identical in physical characteristics” in subparagraph (A) above. On this point we disagree with the court’s analysis that this single sale of cucumbers in brine was not a representative sale solely because of the much greater number of sales of fresh cucumbers. The comparison is not valid. If we were to remand for further consideration of this sale, the Government might prevail on this issue since a price for identical goods must be given precedence as an export value over a price for similar goods. However, in the interests of judicial economy, we will assume that this sale is not representative, as urged by ap-pellee,12 thereby reaching the question whether fresh cucumbers and cucumbers in brine are “similar merchandise” as that term is defined in § 402 (f) (4).
Even before the Customs Simplification Act of 1956 added the above quoted definition of “such and similar merchandise,” this court interpreted “similar” merchandise to mean merchandise which is not only used for the same purpose, but also is substantially the same in material and costs and sold at substantially the same price, thereby making the goods commercially interchangeable. Cf. C. J. Tower & Sons v. United States, 50 CCPA 76, C.A.D. 824 (1963) (non-tipped bobby pins not similar to rubber tipped bobby pins, the entries being made in 1952-54); United States v. Kraft Phenix Cheese Corp., 26 CCPA 224, C.A.D. 21 (1938) (“Standard” and “Portion” Roquefort cheese not similar because process used to make “Portion” type enabled it to be smoothly cut). The definition set forth in subpar-agraph (C) above incorporates at least these criteria. Appellee made no attempt to prove similarity except in the purpose for which pickle-type fresh cucumbers and cucumbers in brine are used. [6]Being like the merchandise undergoing appraisement in use, while a necessary element of “similar” merchandise, is insufficient to establish that the merchandise is similar within the meaning of the statute. B. A. McKenzie & Co. v. United States, 47 CCPA 143, C.A.D. 748 (1960).
Summary
Merchandise must be appraised on the basis of its condition as imported. Because brining alters the physical condition of the vegetable, the imported merchandise is cucumbers in brine not fresh cucumbers.
The finding by the court below that appraisement could not be based on the transactions between Arnold and Pickle-Mex in view [93]*93of the interrelationship of the companies is supported by substantial evidence.
On the assumption that the single sale of cucumbers in brine to a third party is not representative and does not stand in the way of considering an export value based on the sale of similar goods, we conclude that the sales price for fresh cucumbers is not for merchandise “similar” to cucumbers in brine, within the statutory definition provided in § 402(f)(4)(C). Appellee has proved similarity in use only, which is insufficient.
Arnold has, thus, failed to satisfy the dual burden of proof imposed on one challenging the validity of the value at which its goods were appraised. Even though the basis for the appraised value, “sales” between Arnold and Pickle-Mex, has been proven erroneous, the appraised value for the imported merchandise must remain in effect since the only alternative basis asserted by Arnold, sales of fresh cucumbers, is also erroneous.
Accordingly, we reverse the judgment of the United States Court of International Trade.