Home

Current dumping laws significantly undermine
position of U.S. farmers

Washington, DC - Consuming Industries Trade Action Coalition (CITAC) Executive Director Janet Kopenhaver said the International Trade Commission's (ITC) unanimous decision today that fertilizer imports from Belarus, Russia and Ukraine have injured or threaten to injure U.S. fertilizer producers, "hurts American farmers and does not accurately represent the complexities of the situation, which led to the filing of this case."

"Fertilizer users are now facing the same dilemma as lumber and steel users - a trade case that has the potential to significantly damage their business and no opportunities to participate as an interested party in the case," continued Kopenhaver.

The Committee for Competitive Fertilizer Markets, a group of concerned farmers, fertilizer dealers and others organized to fight the urea ammonium nitrate (UAN) antidumping investigation, testified before the ITC in opposition to trade restrictions. However, without interested party status in the case, downstream users have no recourse to appeal the Commission's decisions when the plight of downstream users is not adequately considered.

On behalf of the members of the Committee, Cliff Daugherty, Fertilizer Division Manager of United Suppliers, Inc. in Eldora, Iowa, testified that the U.S. producers' problems were self-inflicted. In late 2000 with natural gas prices rising, U.S. nitrogen fertilizer producers decided to sell natural gas futures, while shutting down their fertilizer operations. "Our main source for UAN told us to seek alternative suppliers. We had no idea how long the shutdown would last and we needed to build supply for the spring planting season," said Daugherty.

"This put us and other fertilizer wholesalers in a bind. We had to scramble to find product," said Daugherty. When gas prices dropped, U.S. producers returned to fertilizer production, ignoring the oversupply that had developed during their hiatus. "Now U.S. producers are sitting on a lot of overpriced inventory and blaming it on our trading partners."

U.S. producers have asked the Government to impose antidumping duties ranging from 76% to 327% on imports.

"Imports play an important safety valve role in the U.S. UAN market," stated Laura Baughman, Executive Director of the Committee. "Ironically, the U.S. industry now wants the U.S. Government to place high duties on imported UAN so that the imports are locked out of the market. Imports did not cause any injury and have since fallen off completely. The fact is that the U.S. industry abandoned the farmers and distributors."

As a result of today's decision, the case moves to the Commerce Department, where an investigation of whether or not UAN from Russia, Belarus, and Ukraine has been sold in the United States at unfair prices will be conducted. If they so conclude, perhaps some time early next year the ITC will begin another more detailed investigation of injury. Only if it decides that dumped imports are injuring or threatening to injure U.S. producers will the dumping duties go into effect. "In the interim, a lot of uncertainty will remain in the UAN marketplace," said Laura Baughman.

To provide downstream users with a role in trade cases, CITAC, is leading the effort for passage of The Transparency and Fairness Trade Act (HR 2770). The act would create opportunities for downstream industries to participate in, and receive more balanced outcomes from, the U.S. trade policymaking process. The bill has two essential components: 1) bringing downstream industries into the trade debate by making purchasers full parties to trade cases; and 2) exempting imports temporarily from trade remedy actions if they are not made in the United States or are in short supply.

In addition to promoting HR 2770, CITAC will continue to support exclusion requests and opportunities, and continue to voice the concerns of downstream users caught in the fruitless cycle of protectionism.

CITAC is a coalition of companies and organizations committed to promoting a trade arena where U.S. consuming industries and their workers have access to global markets for imports that enhance the international competitiveness of American firms.