« January 2007 Table of Contents
One Man's Opinion: Christmas cheer on the bayou
By Peter Redmayne
January 01, 2007
There was plenty of cheer among seafood companies in the
southeastern United States this holiday season. The first round
of antidumping monies began flowing into the pockets of the
companies that had claimed injury from the flood of imported
shrimp (see Newsline this issue, p. 10).
Under the Byrd Amendment, which was passed in 2000, tariffs
from antidumping petitions go to the U.S. producers that
supported the original trade action. Prior to the Byrd
Amendment, the money went to Uncle Sam. In the case of shrimp
tariffs, there's a lot of money to spread around, since the
dumping duties haven't curbed the flood of imported shrimp,
which is closing in on $4 billion a year.
The government was expected to distribute about $100 million
in duties to the southern shrimp industry in 2006. It's no
surprise that there has been controversy.
The first issue is the legitimacy of the claims. Keep in
mind the Byrd money is being distributed by the same federal
government accused of squandering more than $1 billion on
fraudulent claims associated with Hurricane Katrina.
The Southern Shrimp Alliance, which filed the antidumping
petition on behalf of the domestic shrimp industry, has
complained to customs that it suspects a lot of fishy claims.
Since customs admittedly hasn't verified the claims, this is
hardly surprising, human nature being what it is.
The second issue is over who's getting the money. According
to one analysis, 57 percent of the monies being distributed are
going to just 20 companies, mostly shrimp packers.
Most of these disbursements range from $1 million to $3
million, not a bad payday in the fish business, especially when
you consider there's more money coming. While there's little
doubt that shrimpers have been hurt by falling shrimp prices,
some people question whether processors are in the same
Processors work on margins and volume. Despite the rise in
imports, U.S. shrimp catches have been relatively stable.
Typically, processors react to market prices by lowering (or
raising) the price they pay for raw material. As a result, they
can preserve their margin and - if they have enough volume
running through their plant - make a decent profit. In
addition, some Gulf shrimp processors have relied on cheap
imported shrimp to boost sales.
Although the SSA maintains the Byrd monies "are vital to the
recovery of the U.S. shrimp industry," it's hard to see how the
millions going to processors will help shrimp fishermen deal
with the reality that shrimp prices are unlikely to ever
recover in an age of cheap farmed shrimp.
Also, the shrimp industry can't count on the Byrd money much
longer. The World Trade Organization ruled the amendment was
not consistent with U.S. trade obligations as a WTO member.
After a number of WTO nations took retaliatory trade ac t ions
because of Byrd, President Bush signed legislation repealing
it. Still, duties collected through September 2007 will be
So for some fortunate few in the Gulf seafood industry,
Christmas came early and the party will last for most of next
Contributing Editor Peter Redmayne lives in Seattle