A shrimp farm in Ecuador. (Photo: Stockfile)

Shrimp farmers are preparing for conflict with the U.S.

ECUADOR
Thursday, January 10, 2013, 03:40 (GMT + 9)

Businessmen and government officials began to outline a strategy to deal with a new problem that worries shrimp producers in Ecuador: a petition filed in late December by a group of U.S. shrimp companies demanding the application of countervailing duties on shrimp imports from Ecuador, among other countries.

In its submission to the Ministry of Commerce (DOC) and the United States International Trade Commission (USITC), the Coalition of Gulf Shrimp Industries (COGSI) reported the existence of alleged subsidies that governments of China, India, Indonesia, Malaysia, Thailand, Vietnam and Ecuador offer their prawn and shrimp producers.

The U.S. group complains that this situation would be generating a reduction in the prices of these crustaceans in the U.S. market, which significantly affects the domestic industry.

It is not the first time that Ecuador faces a complaint of alleged unfair competition or dumping in the United States.

In 2003 it received a similar complaint and was punished with a provisional tariff of 7.3 per cent on its shrimp exports, which then went to 3.58 per cent, Diario Hoy informed.

Only in 2007, the DOC revoked the tariff to comply with a ruling by the World Trade Organization (WTO), the body to which the country took its lawsuit.

At that time, the WTO ruled in favor of Ecuador on the grounds that the unilateral sanctions imposed by the U.S. violated international trade rules.

For producers, the current situation is very similar.

The industry argues that the surprising Cogsi’s claims are unfounded.

"Everything we have been able to produce has been based on our efforts, by the sweat of our brow," said a shrimp producer.

In Ecuador there are 2,500 shrimp farms operating in five provinces.

The shrimp ponds cover about 122,000 hectares and pay three taxes.

Producers explained that after an outbreak of white spot disease wreaked havoc on the industry over a decade ago, they were able to increase their productivity, leading to double or sometimes even quadruple yields per hectare.

However, from the U.S., Edward T. Hayes, COGSI’s lawyer, said in a statement that imports and its "unfair" pricing policy are making it increasingly difficult for U.S. producers to cover their production costs, El Universal reported.

"Without relief, we fear that these unfair foreign subsidies ultimately lead domestic industry to extinction," he said.

Related article:

- Shrimp sector rejects U.S. demand

By Analia Murias
[email protected]
www.seafood.media

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