« February 2006 Table of Contents
Editor's Note: Blame it on Byrd
February 01, 2006
The industry rumor mill always kicks into high gear this month, leading up to The International Boston Seafood Show in March. In the past, pre-show speculation has been about companies on the brink of going belly-up, industry consolidation and buyers who have gone to work for the competition. But this year’s buzz is based more in fact than in fiction.
The current big scare story, and the topic of this issue’s Top Story, revolves around shrimp importers and the Byrd Amendment. “Shrimp traders pinched,” written by Associate Editor Steven Hedlund, examines the effects of Customs’ new continuous-bond policy, which is squeezing shrimp importers for all they’re worth — literally.
Importers dealing with shrimp duties are posting bonds from $5 million to $20 million, depending upon sales. Most importers are working on low margins already, so the increased bond is forcing many companies to tighten their belts.
The long-term ramifications of the bonds could include consolidation and higher shrimp prices. Further, the prevalence of importers transshipping and mislabeling shrimp to evade the new bond policy will only increase, and, unfortunately, some importers who play by the rules will go under. The industry has the Byrd Amendment to thank.
The legislation was intended to help domestic industries compete against imports by funneling tariff monies directly to industries that filed antidumping cases. But the U.S. crawfish, catfish and shrimp industries have not been “saved” by the Byrd Amendment. It’s just another example of international trade being turned into a political quagmire.
There is sure to be discussions about the continuous bonds for shrimp at the seafood show. If there’s grumbling in the aisles, it should be about the Byrd Amendment. The legislation continues to offer false promises to domestic industries while hindering international trade. For an industry dependent on global trade, Byrd is no way to do business.