Shrimp subsidies in five nations appear to be undercutting U.S. prices and importers must pay bonds up to nearly 63 percent to offset the subsidies, the U.S. Department of Commerce said Wednesday.
The order affects frozen warm-water shrimp from China, India, Malaysia, Thailand and Vietnam.
"It's a good day. It means that a substantial percentage of the shrimp imported into this country will face some level of at least temporary tariff until such time as the final determine is made about the amount, if any," said David Veal, executive director of a group representing shrimp processors in the five Gulf of Mexico states, Georgia and North Carolina.
Subsidies in Ecuador and Indonesia appear too small to hurt the domestic industry but investigators will go to those countries as well as the other five for further investigation, the department said.
Its final decision is due Aug. 13.
For the preliminary investigation, the department asked one or two companies from each country to provide information about their sources of income.
The biggest subsidy spread within a country and the highest rate cited were in Malaysia, where investigators said one company received subsidy rates of 10.8 percent and another 62.74 percent. The higher rate will be applied to all other producers and exporters, it said.
Preliminary rates set for imports from the other countries are: India, 10.8 percent; China, 5.76 percent; Vietnam, 6.07 percent and Thailand, 2.09 percent.
"Nobody minds competing with anybody. But it's very difficult for a small business in this country to compete with a foreign government," Veal said. "That's the situation we find ourselves in."
The group's attorney, Edward T. Hayes, said Ecuador and Indonesia aren't off the hook. "Their numbers still have to be verified by the Department of Commerce. ... It's quite commonplace that (final) numbers may be higher."
No matter what the in-country audits find, he said, "This is only one-half the story. None of this means anything if we don't win the case at the International Trade Commission, which is an entirely separate proceeding."
The ITC will send questionnaires to industry participants and there will be a hearing, he said.
"We're confident we'll be able to show that the subsidized imports are causing injury," Hayes said.