Statement by Laura Baughman

Remarks by Laura Baughman of The Trade Partnership

My name is Laura Baughman. I’m President of The Trade Partnership, an economics and trade research firm in Washington , DC .

I have spent the last 26 years analyzing the economic effects of U.S. trade policies and actions on the economy generally and consumers specifically. I have particular expertise in working with the U.S. International Trade Commission to explain the impacts of imports on U.S. industries, especially in antidumping investigations. I earned an undergraduate degree in International Trade from Georgetown University and a Master's degree in economics from Columbia University .

The CITAC/ASDA Shrimp Task Force asked us to measure the impact on shrimp prices should the Commerce Department impose the antidumping duties sought by the petitioners in this investigation. Those duties range from 32 percent to 349 percent. We looked at two scenarios: the impact of the imposition of the lower range of duties sought, which average 63%, and the impact of the imposition of the higher range of duties sought, which average 117%. Using a model very similar to that employed by the U.S. International Trade Commission, we found:

	Scenario 1: 62.86% Average Duty	Scenario 2: 117.43% Average Duty
Change in Aggregate Shrimp Price	+30.0%	+44.0%
–  Change in domestic shrimp price	+19.5%	+28.1%
–  Change in average price of shrimp from 6 countries	+47.8%	+83.8%
–  Change in average price of shrimp from other countries	+13.0%	+18.5%
Impact on Shrimp Consumption (percent)	-26.4%	-32.3%
–  Change in domestic supply	+9.3%	+13.2%
–  Change in imports from 6 countries	-62.2%	-81.4%
–  Change in imports from other countries	+44.3%	+66.6%
Impact on Shrimp Consumption (millions of pounds)	-276.7	-338.3
–  Change in volume of domestic supply	+12.9	+18.3
–  Change in volume of imports from 6 countries	-404.3	-528.8
–  Change in volume of imports from other countries	+114.7	+172.2

In other words, if the Commerce Department agrees with the petitioners that the margins should be the ones alleged in the petitions, and if the shrimp market works the way petitioners say it does in terms of responses to prices and substitution between imported and U.S.-caught shrimp, the impacts would be as I have suggested.

The Task Force also asked The Trade Partnership to estimate the size of shrimp sales by grocery stores. We looked at very detailed data published by the Bureau of Labor Statistics for personal consumption expenditures by households. The data are available for fish and seafood; we relied on data from the National Marine Fisheries Services to estimate shrimps' share of seafood consumption.

On the basis of these data, we estimate that the value of shrimp consumed at home — in other words, shrimp sold by grocery and other food stores — doubled from $1.4 billion in 1995 to $2.9 billion in 2002, or from $14 per household to $25 per household. Lower-cost shrimp has been especially beneficial for low-income households. Shrimp consumption as a share of total food consumption at home for households earning $15,000 or less increased 45% from 2000-2002, compare to an increase of 15% each for middle income and high income households.