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                                               February 2, 2009



                        Congressional Research Service
                                       Report RS21776
                        Shrimp Trade Dispute: Chronology
                        Eugene H. Buck, Resources, Science, and Industry Division

                                               January 11, 2005

Abstract. In 2003, elements of the U.S. shrimp industry became increasingly concerned by what they believed
to be unfair pricing practices for warm-water shrimp exported by six countries: Brazil, China, Ecuador, India,
Thailand, and Vietnam. An ad hoc committee of shrimp boat owners and shrimp processors filed antidumping
petitions on December 31, 2003. This action is opposed by U.S. seafood distributors, retailers, restaurateurs, and
other businesses involved in shrimp processing and marketing, as well as by the targeted exporting countries. The
preliminary determinations of antidumping duty investigations have been announced, and final determinations
on action to be taken are anticipated in early 2005.
                                                                                                                         Order Code RS21776
                                                                                                                     Updated January 27, 2005



                                            CRS Report for Congress
                                                            Received through the CRS Web


                                                       Shrimp Trade Dispute: Chronology
                                                                           Eugene H. Buck
                                                               Specialist in Natural Resources Policy
                                                              Resources, Science, and Industry Division

                                        Summary

                                                 In 2003, elements of the U.S. shrimp industry became increasingly concerned by
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                                            what they believed to be unfair pricing practices for warm-water shrimp exported by six
                                            countries: Brazil, China, Ecuador, India, Thailand, and Vietnam. An ad hoc committee
                                            of shrimp boat owners and shrimp processors filed antidumping petitions in late 2003.
                                            This action is opposed by U.S. seafood distributors, retailers, restaurateurs, and others
                                            involved in shrimp processing and marketing, as well as by the targeted exporting
                                            countries. Final determinations of antidumping duty investigations were announced by
                                            the Department of Commerce, and antidumping orders were issued in late January 2005.
                                            This report will be updated as the issue evolves.

                                             In 2003, elements of the U.S. shrimp industry became increasingly concerned by
                                        what they believed to be unfair pricing of warm-water shrimp (primarily farm-raised)1
                                        exported by six countries -- Brazil, China, Ecuador, India, Thailand, and Vietnam --
                                        claiming that this situation caused the loss of thousands of U.S. jobs and forced hundreds
                                        of U.S. companies to close.2 In 2003, more than 88% of the 1.7 billion pound U.S. shrimp
                                        supply was derived from imported product,3 with 74% of these imports from the six
                                        targeted countries.4 An ad hoc committee of shrimp boat owners and shrimp processors
                                        filed antidumping petitions on December 31, 2003. This action is opposed by U.S.



                                        1
                                         General background on shrimp farming and associated environmental concerns can be seen at
                                        [http://www.enaca.org/modules/wfsection/article.php?articleid=19], viewed on Mar. 22, 2004.
                                        As a specific example, a detailed discussion of shrimp farming practices in Thailand can be seen
                                        at [http://www.aciar.gov.au/web.nsf/doc/ACIA-5MQ4AU/$file/TR%2047.pdf], viewed on Mar.
                                        22, 2004. Harvesting of wild shrimp also has associated environmental concerns, including
                                        substantial bycatch; for a discussion of these concerns, see [http://galveston.ssp.nmfs.gov/
                                        publications/pdf/235.pdf], visited Aug. 2, 2004.
                                        2
                                           See [http://www.shrimpalliance.com/Press%20Releases/Filing%20Press%20Release.pdf],
                                        visited on Mar. 19, 2004.
                                        3
                                         U.S. Dept. of Commerce, National Oceanic and Atmospheric Administration, National Marine
                                        Fisheries Service, Fisheries of the United States, 2003 (Washington, DC: Oct. 2004), p. 82.
                                        4
                                            Ibid., p. 66.

                                                   Congressional Research Service ~ The Library of Congress
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                                        seafood distributors,5 retailers, restaurateurs, and other businesses involved in shrimp
                                        processing and marketing, as well as by the targeted exporting countries, who claim that
                                        (1) imported shrimp support about 100,000 jobs in the U.S. domestic processing sector
                                        and provide additional incomes estimated at more than $2 billion annually to U.S.
                                        retailers and restaurants, (2) the price U.S. seafood consumers pay for shrimp would
                                        increase significantly if the supply of inexpensive imported shrimp is curtailed, and (3)
                                        U.S. commercial shrimp harvesters lack competitiveness due to high costs of production,
                                        which cannot be alleviated by taxing imports. Antidumping proponents countercharge
                                        that U.S. seafood distributors and marketers make excessive profits from low-cost
                                        imported shrimp and do not pass substantial savings on to consumers.

                                             Antidumping investigations are not simple accounting exercises. When the
                                        Department of Commerce exercises its considerable flexibility to select the data and
                                        design methodologies to make the antidumping calculations,6 it makes international
                                        economic policy choices for the U.S. government. The U.S. government has very broad
                                        discretion in calculating cost and price of shrimp exports from the six countries, including
                                        cost and price definitions and comparisons that will affect any dumping margins.
                                        Opponents of the petitions seek assurances that these exercises of discretion will be
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                                        transparent and subject to review and oversight, claiming that too much is at stake, both
                                        here and abroad, for these choices to be made without public scrutiny.7 A preliminary
                                        economic analysis of the impact of shrimp imports on U.S. industry is provided in Certain
                                        Frozen and Canned Warmwater Shrimp and Prawns from Brazil, China, Ecuador, India,
                                        Thailand, and Vietnam (Investigation Nos. 731-TA-1063-1068 (Preliminary), USITC
                                        Publication 3672), released on March 16, 2004.

                                             The following chronology follows the development of this issue. Key references are
                                        identified in footnotes by links to where they may be viewed, with care taken to select
                                        those resources that may be least transient. Full citations are not provided to these
                                        footnoted documents because of the lengthy organizations and titles.

                                        Chronology
                                        08/06/2003 --       Board of the Louisiana Shrimp Association unanimously votes to
                                                            pursue shrimp trade remedy actions, including antidumping and
                                                            countervailing duty petitions, against foreign shrimp imports.

                                        08/08/2003 --       Southern Shrimp Alliance votes to pursue shrimp trade remedies.

                                        08/22/2003 --       American Shrimp Processors Association votes to support antidumping
                                                            and countervailing duty petitions against imported shrimp products.


                                        5
                                            See [http://www.freetradeinseafood.org/news/press11.htm], visited on Mar. 19, 2004.
                                        6
                                          For example, the Department of Commerce adopted the suggestion of petitioners' lawyers that
                                        it collect data to compare the prices of peeled vs. shell-on shrimp. Opponents of the petitions
                                        suggest this approach compares dissimilar products, when sales of identical products are
                                        available for comparison, and results in dumping margins where none really exist.
                                        7
                                         US-ASEAN Business Council, Inc., Shrimp Antidumping Cases Threaten a Major Economic
                                        Sector in the Targeted Developing Countries, undated, 2 p.
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                                        11/10/2003 --        Louisiana Governor Mike Foster reportedly pledges $600,000 in state
                                                             funding if an antidumping petition is filed by December 15, 2004.8

                                        12/18/2003 --        Southern Shrimp Alliance and the National Chamber of Fishing and
                                                             Aquaculture Industries of Mexico issue a joint statement, announcing
                                                             cooperation to oppose unfair shrimp trade.9

                                        12/31/2003 --        Ad Hoc Shrimp Trade Action Committee, an ad hoc committee of boat
                                                             owners and shrimp processors, files six antidumping petitions with the
                                                             International Trade Commission (ITC) and the Department of
                                                             Commerce (DOC).10

                                        01/08/2004 --        ITC publishes a Federal Register notice that preliminary antidumping
                                                             investigations are being initiated for frozen and canned warmwater
                                                             shrimp and prawns from six countries.11

                                        01/12/2004 --        Foreign Agricultural Service, U.S. Department of Agriculture, certifies
                                                             a petition for trade adjustment assistance for Alabama shrimpers, based
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                                                             on a determination that increased imports of farmed shrimp contributed
                                                             to a decline in the domestic price of shrimp during 2002.12

                                        01/16/2004 --        Louisiana Shrimp Association files a document with the DOC opposing
                                                             the antidumping petitions "as currently drafted," arguing that the DOC
                                                             should treat fresh shrimp as the same "like product" as frozen shrimp.

                                        01/21/2004 --        DOC announces that the petitions of the Ad Hoc Shrimp Trade Action
                                                             Committee meet statutory requirements and that antidumping
                                                             investigations are being initiated.13 The DOC subsequently publishes
                                                             a Federal Register notice of this action.14

                                        01/21/2004 --        ITC holds a public conference on this issue.15




                                        8
                                            See [http://www.usvtc.org/shrimp%20article%201.pdf], visited on Mar. 19, 2004.
                                        9
                                         See [http://www.shrimpalliance.com/Press%20Releases/Mexico%20Support.pdf], visited on
                                        Mar. 19, 2004.
                                        10
                                         See [http://www.shrimpalliance.com/Press%20Releases/Filing%20Fact%20Sheet.pdf], visited
                                        on Mar. 19, 2004.
                                        11
                                             69 Fed. Reg. 1301-1302, Jan. 8, 2004.
                                        12
                                             69 Fed. Reg. 1695, Jan. 12, 2004.
                                        13
                                          See [http://www.ita.doc.gov/media/FactSheet/0104/shrimp_012104.html], visited on Mar. 19,
                                        2004.
                                        14
                                             69 Fed. Reg. 3876-3883, Jan. 27, 2004.
                                        15
                                             See [http://www.usitc.gov/er/wl/wl1_0119.pdf], visited on Mar. 19, 2004.
                                                                                       CRS-4

                                        02/10/2004 --        National Shrimp Industry Association, representing major U.S. shrimp
                                                             processors and importers, announces that it will join the American
                                                             Seafood Distributors Association in opposing the petitions.16

                                        02/17/2004 --        ITC votes unanimously that there is a reasonable indication that a U.S.
                                                             industry is materially injured or threatened with material injury by
                                                             imports of certain frozen and canned warmwater shrimp and prawns
                                                             from Brazil, China, Ecuador, India, Thailand, and Vietnam that are
                                                             allegedly sold in the United States at less than fair market value.17 The
                                                             ITC subsequently publishes a Federal Register notice of this action.18

                                        03/16/2004 --        ITC releases Certain Frozen and Canned Warmwater Shrimp and
                                                             Prawns from Brazil, China, Ecuador, India, Thailand, and Vietnam
                                                             (Invest. No. 731-TA-1063-1068 (Prelim.), USITC Publication 3672).19

                                        04/01/2004 --        Consuming Industries Trade Action Coalition (representing U.S.
                                                             restaurants, grocers, seafood distributors and processors) announces its
                                                             opposition to the shrimp antidumping action.20
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                                        04/05/2004 --        Foreign Agricultural Service, U.S. Department of Agriculture, certifies
                                                             petitions for trade adjustment assistance for Florida and North Carolina
                                                             shrimpers and Arizona shrimp producers, based on a determination that
                                                             increased imports of farmed shrimp contributed to a decline in the
                                                             domestic price of shrimp.21

                                        04/05/2004 --        After shrimp exports to the Australian market surge, ABC News reports
                                                             that Australia is investigating the possibilities of launching an
                                                             independent trade action against shrimp exporting nations and filing an
                                                             amicus brief in support of U.S. action.

                                        04/09/2004 --        National Restaurant Association announces its opposition to the shrimp
                                                             antidumping petitions.22

                                        04/13/2004 --        After this date, shrimp imported to the United States from China and/or
                                                             Vietnam could be subject to retroactive tariffs, if the decision on their
                                                             petition is affirmative.

                                        04/14/2004 --        DOC reports that more than 134 million pounds of shrimp were
                                                             imported by the United States in February 2004, nearly double the

                                        16
                                             See [http://www.freetradeinseafood.org/news/press14.htm], visited on Mar. 19, 2004.
                                        17
                                             See [http://www.usitc.gov/er/nl2004/ER0217bb1.HTM], visited on Mar. 19, 2004.
                                        18
                                             69 Fed. Reg. 9842, Mar. 2, 2004.
                                        19
                                             See [ftp://ftp.usitc.gov/pub/reports/opinions/PUB3672.PDF], visited on Mar. 19, 2004.
                                        20
                                             See [http://www.citac.info/shrimp/press_releases/2004/04_01.htm], visited on Apr. 22, 2004.
                                        21
                                             69 Fed. Reg. 17637-17638, Apr. 5, 2004.
                                        22
                                             See [http://www.restaurant.org/news/story.cfm?ID=192], visited Apr. 26, 2004.
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                                                             amount for February 2003, as shrimp-exporting nations seek to ship
                                                             inventory prior to the time they could face potential tariff liability under
                                                             the pending antidumping petitions.

                                        04/20/2004 --       Consumer advocacy group Public Citizen launches campaign to inform
                                                            consumers on "health effects and social concerns of farmed shrimp."23

                                        04/29/2004 --       Louisiana Shrimp Association files a lawsuit in U.S. district court,
                                                            asking for a ruling on whether LSA members are eligible for any
                                                            monetary proceeds that may result from the antidumping petitions.

                                        05/06/2004 --       After this date, shrimp imported to the United States from Brazil,
                                                            Ecuador, Thailand, and/or India could be subject to retroactive tariffs,
                                                            if the decision on their petition is affirmative.

                                        05/07/2004 --        Thirteen Members of Congress send a letter to the Secretary of
                                                             Commerce calling for efforts to assure a fair, rational, and objective
                                                             process and urging consideration of a 50-day extension on the
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                                                             preliminary determination of any antidumping duties.24

                                        05/14/2004 --        Louisiana Governor Kathleen Blanco authorizes the transfer of
                                                             $350,000 to the Southern Shrimp Alliance to help pay legal expenses
                                                             for the antidumping proceedings.

                                        05/19/2004 --       Noting the extraordinarily complicated nature of the proceedings, DOC
                                                            announces that it will delay a preliminary determination on antidumping
                                                            duties until July 2 for China and Vietnam, and until July 28 for Brazil,
                                                            Ecuador, Thailand, and India.

                                        05/19/2004 --        Citing a surge in shrimp imports from China, Thailand, India, and
                                                             Vietnam, the Southern Shrimp Alliance files a critical circumstances
                                                             petition with the DOC, requesting retroactive duties on these imports.

                                        07/06/2004 --       DOC announces preliminary determinations for China and Vietnam.
                                                            Estimated dumping margins range from 7.67% to 112.81% for China,
                                                            and from 12.11% to 93.13% for Vietnam.25

                                        07/29/2004 --        DOC announces preliminary determinations for Brazil, Ecuador,
                                                             Thailand, and India. The estimated dumping margins range from 0.00%




                                        23
                                             See [http://www.citizen.org/pressroom/release.cfm?ID=1692], visited on Apr. 26, 2004.
                                        24
                                             See [http://www.citac.info/shrimp/doc/to_evans_doc_050704.pdf], visited on May 26, 2004.
                                        25
                                          See [http://ia.ita.doc.gov/download/factsheets/factsheet-nme-shrimp-prelim-revised-070704.
                                        pdf], visited Aug. 3, 2004. See also 69 Fed. Reg. 42654-42672, July 16, 2004 (China) and 69
                                        Fed. Reg. 42672-42687, July 16, 2004 (Vietnam).
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                                                           to 67.80% for Brazil, from 6.08% to 9.35% for Ecuador, from 3.56% to
                                                           27.49% for India, and from 5.56% to 10.25% for Thailand.26

                                        08/24/2004 --      DOC announces amendments to the preliminary determinations for
                                                           Brazil, China, and Vietnam to correct for ministerial errors.27

                                        11/30/2004 --      DOC announces its final determinations for China and Vietnam. The
                                                           dumping margins range from 27.89% to 112.81% for China, and from
                                                           4.13% to 25.76% for Vietnam.28

                                        12/20/2004 --      DOC announces its final determinations for Brazil, Ecuador, Thailand,
                                                           and India. The dumping margins range from 9.69% to 67.80% for
                                                           Brazil, from 2.35% to 4.48% for Ecuador, from 5.02% to 13.42% for
                                                           India, and from 5.79% to 6.82% for Thailand.29

                                        01/06/2005 --      ITC announces affirmative final determinations for non-canned
                                                           warmwater shrimp and prawns from all six countries.30
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                                        01/26/2005 --      DOC issues antidumping orders for all six countries. The amended
                                                           final dumping margins range from 27.89% to 112.81% for China, from
                                                           4.30% to 25.76% for Vietnam, from 4.97% to 67.80% for Brazil, from
                                                           2.48% to 4.42% for Ecuador, from 4.94% to 15.36% for India, and from
                                                           5.29% to 6.82% for Thailand.31




                                        26
                                          See [http://ia.ita.doc.gov/download/factsheets/factsheet-shrimp-prelim-brz-ecu-ind-thai-072804
                                        .pdf], visited Aug. 3, 2004. See also 69 Fed. Reg. 47081-47091, Aug. 4, 2004 (Brazil), 69 Fed.
                                        Reg. 47091-47100, Aug. 4, 2004 (Ecuador), 69 Fed. Reg. 47111-47120, Aug. 4, 2004 (India), and
                                        69 Fed. Reg. 47100-47110, Aug. 4, 2004 (Thailand).
                                        27
                                          See [http://ia.ita.doc.gov/download/factsheets/factsheet-brazil-prc-vietnam-shrimp-amended-
                                        prelim-ad-082504.pdf], visited Jan. 10, 2005. See also 69 Fed. Reg. 52860-52862, Aug. 30, 2004
                                        (Brazil), 69 Fed. Reg. 53409-53411, Sept. 1, 2004 (China), and 69 Fed. Reg. 53411-53413, Sept.
                                        1, 2004 (Vietnam).
                                        28
                                          See [http://ia.ita.doc.gov/download/factsheets/factsheet-prc-vietnam-shrimp-final-113004.pdf],
                                        visited Jan. 10, 2005. See also the DOC's decision memos on China [http://ia.ita.doc.gov/frn/
                                        summary/prc/04-26976-1.pdf] and Vietnam [http://ia.ita.doc.gov/frn/summary/vietnam/
                                        04-26977-1.pdf] as well as 69 Fed. Reg. 70997-71005, Dec. 8, 2004 (China) and 69 Fed. Reg.
                                        71005-71010, Dec. 8, 2004 (Vietnam), visited Jan. 10, 2005.
                                        29
                                          See [http://ia.ita.doc.gov/download/factsheets/factsheet-shrimp-brazil-ecuador-india-thailand-
                                        122004.pdf], visited Jan. 11, 2005. See also 69 Fed. Reg. 76910-76913, Dec. 23, 2004 (Brazil),
                                        69 Fed. Reg. 76913-76916, Dec. 23, 2004 (Ecuador), 69 Fed. Reg. 76916-76918, Dec. 23, 2004
                                        (India), and 69 Fed. Reg. 76918-76920, Dec. 23, 2004 (Thailand).
                                        30
                                          See [http://www.usitc.gov/ext_relations/news_release/2005/er0106cc1_corrected.htm], visited
                                        Jan. 27, 2005.
                                        31
                                          See [http://ia.ita.doc.gov/download/factsheets/factsheet-shrimp-brazil-ecuador-india-thailand-
                                        prc-vietnam-amended-final-012505.pdf], visited Jan. 27, 2005.