Administration Upholds Tariffs Against Shrimp Imports

The Bush administration on Tuesday upheld the imposition of penalty tariffs on shrimp imports from China and Vietnam, handing a victory to beleaguered U.S. shrimp producers.

The action affirmed with slight modifications a preliminary ruling by the Commerce Department's International Trade Administration last summer.

The penalty tariffs have been collected by border agents since July. The department is scheduled to make a final decision on shrimp imports from four other countries - Brazil, Ecuador, India and Thailand - in late December.

Together, the six countries provide about 75 percent of the shrimp that Americans eat. U.S. food distributors contend that the penalty tariffs will drive up shrimp prices at restaurants and grocery stores.

In the decision Tuesday, the government set duties on Chinese exports of frozen and canned warm-water shrimp at levels ranging from 27.9 percent to 112.8 percent. Vietnamese shrimp exports will be hit with duties ranging from 4.1 percent to 25.8 percent.

The tariffs were imposed because a government investigation found the shrimp from those nations was being sold in the U.S. market at unfairly low prices, a practice known as dumping.

The ruling came in a case brought by the Southern Shrimp Alliance, which has been dealing with rock-bottom prices for shrimp since 2001. It alleged that the U.S. industry was on the brink of destruction because of the flood of cheap foreign shrimp.

"Dumping is cheating, and we thank the Department of Commerce for offsetting this illegal practice and leveling the playing field for U.S. shrimp fishermen, farmers, processors and all fairly trading countries,'' said Eddie Gordon, president of the Southern Shrimp Alliance.

But the Shrimp Task Force, composed of the Consuming Industries Trade Action Coalition and the American Seafood Distributors Association, complained that the penalty tariffs will mean higher prices for consumers and will not help the domestic industry.

"Thousands of family-owned restaurants and businesses will now be forced to pay these duties,'' said Wally Stevens, chairman of the Shrimp Task Force and president of the seafood distributor Slade Gorton Co.

"The U.S. businesses that rely on access to imported shrimp ... together employ thousands of U.S. workers, 20 times those employed in the domestic shrimp industry.''

Foreign shrimp producers have denied they are selling shrimp at artificially low prices as a way to win a larger share of the U.S. market. They contend the United States needs foreign imports because the domestic supply is not large enough to meet demand for shrimp, the country's No. 1 seafood.

Officials from Brazil have said they are studying whether to bring a case against the United States before the World Trade Organization, contending that the penalty duties violate international trade rules.

The eight states represented in the Southern Shrimp Alliance are Alabama, Florida, Georgia, Louisiana, Mississippi, North Carolina, South Carolina and Texas.

The cases against all six countries will go back to the U.S. International Trade Commission for a final ruling early next year on the issue of whether shrimp imports are harming the domestic industry.

If, as expected, the commission upholds its preliminary finding of harm, the anti-dumping tariffs will become final and will remain in effect for five years before they are reviewed again under "sunset'' provisions of the U.S. dumping law.

(Copyright 2004 by The Associated Press. All Rights Reserved.)