US cuts anti-dumping duty on shrimp

The Indian seafood export industry, hit by the appreciating rupee, can now breathe a sigh of relief as the US Department of Commerce (DoC) has drastically cut down the anti-dumping duty on warm water shrimp.

For the industry, it is a double victory on the marine exports front. Last week, the World Trade Organisation (WTO) ruled in favour of India on the issue of continuous bond requirement.

The commerce department has cut down the average anti-dumping duty to 1.09 per cent from 7.22 per cent following the preliminary findings of the second administrative review on shrimp exports.

The department has also announced a duty of 0.70 per cent (4.38 per cent in the first administrative review) for Devi Seafoods and 1.69 per cent (4.03 per cent) for Falcon Marine, the two mandatory respondents in the second edition of the review.

For the second administrative review, which began almost an year back, 313 exporters from India were listed and 71 companies responded to the questionnaire prepared by the DoC.

A number of exporters were excluded from the review as they had ceased exports to the US. They will attract a duty of 10.17 per cent. But nearly 127 exporters, who had not at responded to the review, will attract 110.90 per cent Adverse Facts Available (AFA) duty on exports to the US.

Meanwhile, WTO has ruled in India's favour on the US requirement for 100 per cent continuous bonds on import of products such as shrimp. Earlier, the court had ruled in favour of Ecuador and Thailand on the same issue.

The ruling also confirmed the preliminary findings of a dispute settlement panel in last October against the practice of zeroing.

Ecuador's tariffs have already been removed after the DoC was forced to calculate a duty rate without the use of the zeroing methodology, which discounted any sales at prices higher than the arbitrary 'dumping' margin.

The anti-dumping duty and the customs bond requirement had virtually hit Indian exports to the US. During the 2007-08 April-December period Indian marine exports had dropped by 93,956 tonnes while in value terms it had dropped by almost Rs 1,000 crore.

During the period, total exports stood at 392,939 tonnes valued at Rs 5,701.42 crore against 486,895 tonnes valued at Rs 6,659.22 crore for the same period last year.

In 2007, the country had shipped 20,776 tonnes compared with 27,277 tonnes in the previous year, registering a fall of 8 per cent.

The number of exporters to the US which stood at 211 in 2001 had dropped to 81 by 2006 due to the stringent customs bond requirement and the high rate of anti-dumping duty.

The US commerce department, menawhile, has already started the third edition of the administrative review fout to five weeks back.