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CITAC Shrimp Task Force

November 8, 2004


George Felcyn
The PBN Company


Reckless Rhetoric Won’t Change the Fact that Shrimp
Dumping Case Will Damage U.S. Industries

Washington , DC — The Shrimp Task Force today criticized reckless rhetoric used by the Southern Shrimp Alliance President Eddie Gordon contained in a letter to Commerce Secretary Donald Evans regarding the threat to the American Soybean Association (ASA) caused by the SSA's antidumping petition against imported shrimp from six countries. In its own letter to Secretary Evans, the ASA warned that the outcome of the shrimp antidumping petition could "have a direct and serious impact" on the American soybean industry in terms of lost business by U.S. soybean farmers and the loss of exports of American soybean products to Thailand and China.

American soybean farmers are concerned because a group of agricultural associations representing the vast majority of U.S. soybean consumers in Thailand has threatened to not buy U.S. soybean imports should the U.S. place an antidumping tax on imported shrimp from Thailand. The soybean farmers also are concerned about lost business from other shrimp exports, such as China, the largest foreign consumer of U.S. soybean products.

In his letter to Secretary Evans, Gordon declared, "The United States should never allow its trading partners to violate our trade laws. Dumping is the only private practice explicitly condemned by the World Trade Organization agreements."

In a letter to Gordon, Shrimp Task Force Chairman Wally Stevens stated that he was "surprised and disappointed" at the SSA's reaction to soybean industry concerns over potential lost exports resulting from a backlash over antidumping duties on shrimp imports to the U.S.

"Perhaps you are not aware that the Commerce Department's very own mathematics that account for all or most of the preliminary duty levels have been ruled illegal by the WTO itself," wrote Stevens. "I refer to the DOC's obviously unfair and discretionary 'zeroing' methodology, by which any sales to the U.S. that are at higher prices than foreign sales, and thus would reduce dumping margins, are not counted in the duty calculation. Zeroing helps create or inflate dumping margins, as the margins are based only on the comparisons of a cherry-picked subset of lower priced sales. The WTO has already ruled that zeroing violates international trade rules on how dumping duties are supposed to be calculated."

"The fact is that without applying the illegal zeroing methodology, nearly all of the dumping margins found by the Department of Commerce would disappear," Stevens wrote. "It is no wonder that Thailand and other countries are outraged over the shrimp case when the duties can only be found using 'funny math' already ruled illegal by the WTO."

Stevens also labeled as a "smokescreen" Gordon's assertions that both foreign shrimpers and domestic soybean producers have benefited from government subsidies. "The domestic shrimping industry has been tapping U.S., state, and local governments for millions of dollars in so-called disaster assistance for years, and has only been able to finance this multi-million dollar attack on trade thanks to such payments. The SSA knows very well that those supporting this case stand to receive annual payments under the Byrd Amendment that could reach into the hundreds of millions of dollars if duties are actually imposed on shrimp imports, despite the fact that these subsidies have also been conclusively ruled illegal by the WTO. Let's be honest, this is where the food tax dollars that SSA wants to impose on the U.S. economy would end up."

Earlier this year, the DOC made preliminary determinations on dumping duties for these six countries. The pending preliminary duties for Thailand range from 5.56 percent to 10.25 percent; for China, from 0.04 percent to 112.81 percent; for Vietnam from 12.11 percent to 93.13 percent; for Brazil from 12.86 percent to 67.8 percent; for Ecuador from 6.08 percent to 9.35 percent; and for India from 3.56 percent to 27.49 percent. The DOC will decide final dumping duties for China and Vietnam by November 29, 2004, and for Thailand, India, Ecuador, and Brazil by December 17.

Thanks largely to high-quality, reasonably priced imports, shrimp has become America's #1 seafood, with Americans consuming a record 4.0 pounds of shrimp per person in 2003, up from 3.7 pounds in 2002. Nearly 90% of all shrimp consumed in the U.S. comes from imports, much of it from countries utilizing modern aquaculture techniques that enable exporters to efficiently farm and export their product year-round at low prices. Facing high costs, weather problems, and other disadvantages, U.S. shrimpers have failed so far to keep up with global competition.

In response to the threat that these food taxes pose to consumers and the consuming industries that serve them, the Consuming Industries Trade Action Coalition (CITAC) and the American Seafood Distributors Association (ASDA) formed the CITAC/ASDA Shrimp Task Force, joining concerned grocers, restaurants, processors, distributors, U.S. exporters, business councils, and U.S. importers. The Shrimp Task Force seeks to assure that the U.S. government considers all the facts, applies the law, and exercises its discretion in the case fairly and objectively, with a full understanding of the national ramifications of any decision.

For more information on the Shrimp Task Force, contact George Felcyn at or .