November 18, 2003



US Trade Action May Fuel Shrimp Imports Tariff

U.S. shrimp-industry leaders met with attorneys to place finishing touches on plans for trade actions against foreign shrimp producers last week.

Meanwhile, global news dispatches show signs that the effort is having effects on burgeoning world trading in shrimp that may help as well as hurt local fishermen struggling to survive.

Members of a delegation from the eight-state Southern Shrimp Alliance -- including Louisiana representatives -- gave indications that meetings Thursday and Friday with the Dewey Ballantine law firm went well but would say little more.

"The group is pretty much done and going home," Deborah Regan, a Southern Shrimp Alliance spokeswoman based in Washington, said Friday.

If the trade action is successful, tariffs could be imposed on shrimp imports by the U.S. government. That would boost prices in some cases and, perhaps, give U.S. harvesters and processors needed time to adjust to the worldwide increase of shrimp production.

The increasing supply of cheap, farm-raised imports has pushed wholesale prices so low that fishermen are tying up their boats and teetering on financial ruin from Texas to the Carolinas.

The trade action got a shot in the arm last Monday when Louisiana Gov. Mike Foster mended a rift between warring Louisiana industry factions. In a meeting at the Gover-nor's Mansion, he and shrimp-industry leaders set the groundwork for state help with funding of the multi-million-dollar trade action.

With a strong promise of Louisiana's help, along with money boosts from other states, such as institution of a special fuel tax in Bayou LaBatre, Ala., some industry insiders suggest that lawyers doing the work are more confident that they will get paid.

Another boost came when the largest distributor of frozen shrimp in the United States, Penguin Frozen Foods in Chicago, Ill., expressed support for the trade action. In letters sent to other distributors and processors, the company urged their cooperation and funding assistance.

Attorneys who represent U.S. importers, global exporters and other business people who traffic heavily in shrimp from other lands say they are ready to defend their clients against expected claims that shrimp has been dumped on the U.S. market. Dumping occurs when shrimp is sold here at a price lower than it fetches in its home country or at a cost lower than its production.

"We are actively preparing to defend the case, and we believe we have some very strong defenses that we will put forward at the appropriate time," said Warren Connelly, an attorney at the Washington, D.C., law office Akin Gump Strauss Hauer & Feld.



Attorneys on both sides of the anti-dumping chessboard are aware that the quantity of shrimp imported by U.S. businesses is increasing. And most agree with strong suggestions that exporters and importers are trying to move as much shrimp into the United States as they can before the case is filed.

Sanctions for flooding the market will not kick in, according to U.S. Department of Commerce rules, until after the trade action is filed., an electronic daily seafood industry newsletter, reported Friday that shrimp imports soared 33% in September. China's increase has surged over 80%.

At the same time, trade officials in India have said they are scaling back exports to the United States. Vietnam, another major exporting nation, has already told its seafood people to seek other venues to avoid entanglement in the trade action.

But there are no indications that those moves will offset the effect of more shrimp in the market from other nations.