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US shift may hurt VN shrimp exports

Update: April, 21/2005 - 00:00

US shift may hurt VN shrimp exports

(21-04-2005)

HCM CITY — US shrimp importers may shift more of their purchases to India, Thailand and Bangladesh in the wake of a ruling by the US to require Vietnamese exporters to buy bonds from insurance companies to gain entry to the US market, according to a seafood industry spokesman.

The US Customs and Border Control issued the regulation to ensure that Vietnamese shrimp exporters pay anti-dumping duties imposed on their exports.

Last December, the US International Trade Commission (ITC) ruled that Viet Nam and five other countries were dumping their shrimp products at unfairly low prices on the US market and imposed varying rates of duties on each country.

On April 26, the ITC is expected to issue a ruling that could lower or cancel the anti-dumping duties on shrimp exporters from Thailand and India because of damage they suffered during the tsunami last December.

US importers may choose those markets instead of Viet Nam’s, and shrimp exports to the US could decline dramatically, said Nguyen Van Kich, chairman of the Shrimp Committee of the Viet Nam Association of Seafood Exporters and Producers (VASEP).

Over the last two days, several US importers who are low on stock have agreed to purchase the bonds on behalf of Vietnamese exporters, but most major US importers are taking a wait-and-see attitude, Kich said.

Director Nguyen Van Thang of the Vimex Seafood Exporting company in Bac Lieu Province was previously a major buyer of shrimp for the US market, but has had to stop purchases because of the prohibitively expensive bonds.

Kich said that shrimp importers from Japan may increase their purchases if Viet Nam drops its prices in an effort to increase its market share. Japan imports most of its shrimp from China.

Truong Dinh Hoe, deputy general secretary of VASEP, said the shrimp industry will focus more on the EU market.

But he noted that the EU has strict sanitation regulations and the market is not a subsitute for the US and Japan, both of which account for 50 per cent of the seafood industry’s total export revenue.

He said the seafood industry is concerned that it will not reach its target of US$2.6 billion in export revenue this year.

US Customs issued the new bond regulation after a number of exporters that folded failed to pay their anti-dumping duties to US Customs.

The conditional bonds will be refunded at a later date, but if anti-dumping duties are raised in 2007, Vietnamese companies may not be able to get the sum back, according to VASEP.

Viet Nam pays an average anti-dumping duty of 4.58 per cent. — VNS

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