Agri Business

Anti-dumping duty on Indian shrimps by the US: It’s an ongoing process, says exporters

Sajeev Kumar | | Updated on: Nov 29, 2021
image caption

USDOC hikes rates of Indian frozen, warm water shrimps to 7.15 per cent from 3.06 per cent.

The imposition of anti-dumping duty by the US Department of Commerce on Indian shrimp consignments has evoked mixed responses among the seafood exporters fraternity, saying that individual exporters could appeal for review.

USDOC, in its 15th administrative review, has issued the final results of the anti-dumping duty order on frozen, warm water shrimps from India by increasing the rate to 7.15 per cent from 3.06 per cent in the 14th administrative review.

Rather than making an overall impact on the total exports from the country to the US, Shaji Baby John, Managing Director, Kings Infra, said the USDOC decision is expected to hit the profitability of the select exporting firms. The US is a highly organised and lucrative market, and the industry there does not want low-cost shrimps from importing countries to slump their domestic distribution and retail prices. Hence, the domestic fisheries industry there always lobbies the US government for anti-dumping duties and other entry barriers for imported shrimp, he told BusinessLine .

Echoing a similar view, another source in the exporting fraternity pointed out that the uncertainty in the Chinese markets has forced new players to focus on the US market offering at lower prices. This has also facilitated the hike of duty rates since the US shrimp prices are very remunerative.

Official sources maintain that major players who have not gone for the review are unlikely to hit the current anti-dumping duty rates. The new rates will apply to only those who have preferred reviewing their rates in the current year. A higher anti-dumping duty applies to all exporters for their first entry to the US markets. Later they can appeal for a review. This has been an ongoing process for the last 15 years in the US, and those exporters in the lower slab will not go for any review in the normal case.

Vietnam to benefit

Seafood Exporters’ Association officials said that anti-dumping duty would benefit Vietnam due to the Free Trade Agreement between the two countries. However, the emerging situation would cast a shadow on the prospects of the beleaguered sector when it is recuperating after the easing of Covid restrictions. When Omicron, the new Covid variant, has started ringing alarm bells, the situation may lead to subdued demand in the overseas markets.

The US-based Southern Shrimp Alliance is the original petitioner against India and several other nations in the shrimp import issue. They have raised an allegation that the lower-priced pond raised shrimps from Brazil, China, Ecuador, India, Thailand and Vietnam are hurting the US industry. The US mostly harvests shrimp from the sea.

SSA maintains that the dumping margins in administrative review were determined after USDOC repeatedly selected a tiny subset of Indian exporters for individual examination and has allowed hundreds of other Indian exporters to ship to the US with confidence that their own pricing practice will not be evaluated. This, in turn, has encouraged many Indian shrimp firms to increase their presence in the US market with aggressive pricing strategies.

India’s seafood exports have declined both in volume and value in the last financial year, reaching $5.96 billion following a subdued demand in many overseas markets due to Covid. The frozen shrimp shipments comprise around 74 per cent of the value of India's total seafood exports.

Published on November 29, 2021

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