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US Imposes Potential Countervailing Duties on Shrimp Imports from Ecuador, India, and Vietnam

The US shrimp industry has received a boost as the Department of Commerce (DOC) announced preliminary countervailing duties on shrimp imports from Ecuador, India, and Vietnam. These duties are meant to offset any unfair advantage these countries might have gained from government subsidies.

The Findings:

The DOC determined that shrimp producers and exporters in these countries benefitted from subsidies between January 1st and December 31st, 2022. As a result, shrimp exports will face countervailing duties once the determinations are finalized. The final decision is expected in September 2024.

Impact on Each Country:

  • Ecuador: Faces a 7.55% duty on all shrimp exports to the US. Individual companies may face higher or lower rates, with Sociedad Nacional de Galapagos at 1.69% and Industrial Pesquera Santa Priscila at a significant 13.41%.
  • India: Faces a 4.36% overall duty, with some companies like Devi Sea Foods facing a slightly higher rate (4.72%).
  • Vietnam: Received the lowest duty (2.84%) but one company, Thong Thuan Company, faces a staggering 196.41% due to “adverse facts available.”

Indonesia Avoided Duties:

Indonesia, the fourth country investigated, was found to have minimal subsidies and avoided countervailing duties.

The Process and Potential Impact:

These are preliminary determinations, and the final decision rests with both the DOC (due August 5th) and the International Trade Commission (ITC, due September 19th). If both entities find evidence of subsidies and injury to the US industry, an order imposing duties will be issued by September 26th.

Financial Implications:

The potential duties could significantly impact these countries’ shrimp exports. Ecuador, for instance, exported over $1.4 billion worth of shrimp to the US in 2022. Even at the base 7.55% duty, this translates to over $100 million in additional costs, and that’s not including the higher rate for Santa Priscila.

Looking Ahead:

The coming months will be crucial for the shrimp industries in Ecuador, India, and Vietnam as they await the final decisions and potentially adjust their export strategies. This move by the US could also impact global shrimp prices and potentially benefit domestic shrimp producers.

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