MCLEAN, Va. – The U.S. apple industry today requested that the U.S. Department of Commerce extend antidumping duties on imports of Chinese apple-juice concentrate to include so-called frozen concentrate imports, to prevent Chinese suppliers from further injuring the U.S. industry by illegally evading the duties.

The U.S. government levied antidumping duties of up to 52 percent on Chinese concentrate imports in May 2000, following the Commerce Department and U.S. International Trade Commission’s rulings that Chinese concentrate was sold in the U.S. market at prices below production costs causing economic harm to U.S. concentrate producers – a practice called dumping.

The U.S. apple industry has been devastated in recent years by a flood of unfairly priced concentrate imports from China, which displaced sales of U.S.-produced concentrate and U.S.-grown juice apples.

“U.S. apple growers and concentrate producers are still being held hostage, first by Chinese dumping and now by the Chinese skirting U.S. trade laws,” said U.S. Apple Association (USApple) President and CEO Kraig R. Naasz, whose group spearheaded the apple industry’s antidumping complaint against China. “We want the U.S. government to enforce our nation’s trade laws, and to require that China respect and adhere to those laws.”

The U.S. government’s ruling and subsequent levying of antidumping duties on Chinese imports have helped to offset Chinese dumping. However, some Chinese suppliers are avoiding the tariff by shipping chilled concentrate to the United States duty-free, or by chilling Chinese concentrate shipped to Canada and re-exporting it duty-free to the United States. U.S. trade law prohibits the “circumvention” of antidumping duties in this manner.

Dumping Duties Were Working
Imports of Chinese concentrate dropped 31 percent after the industry filed its antidumping complaint in June 1999, from 53.8 million single strength equivalent (SSE) gallons in 1998 to 37.3 million SSE gallons in 1999. While the volume of imported Chinese concentrate rebounded in 2000 to 50.2 million SSE gallons – an increase of 35 percent compared to 1999, but still 7 percent below 1998 – the value has increased substantially. The average value of Chinese concentrate was $4.14 per gallon in 1998, $5.81 per gallon in 1999 and $6.29 per gallon in 2000 – reflecting the upward impact of antidumping duties on the cost of Chinese concentrate.

Prior to the antidumping case, U.S. concentrate producers were forced to slash their prices, and to drastically reduce the price they paid to U.S. growers for juice apples. Imports of Chinese concentrate increased by 1,200 percent between 1995 and 1998. During that same time period, the average price of Chinese concentrate imports declined by 53 percent from $7.65 per gallon in 1995 to a low-water mark of $3.57 per gallon in 1998.

The average price for U.S. apple juice concentrate fell by more than 50 percent between 1995 and 1998, while the average price received by U.S. growers for juice apples fell by 64 percent, from $153 per ton in 1995 to $55 per ton in 1998. U.S. apple growers lost more than $135 million in revenue from the decline in juice-apple prices, according to U.S. Department of Agriculture statistics.

Chinese Appeal Antidumping Ruling
In a related development, the U.S. apple industry filed a rebuttal brief with the U.S. Court of International Trade in New York City on April 6, joining the U.S. Department of Justice in defending the U.S. government’s antidumping ruling against appeal. Chinese concentrate suppliers appealed the Commerce Department’s antidumping ruling to the U.S. Court of International Trade in July 2000, and filed their plaintiffs’ brief with the court in January of this year.

Chinese suppliers are arguing that the Commerce Department violated U.S. trade law in arriving at its antidumping decision; whereas the Justice Department and the apple industry are arguing that the Commerce Department’s decision is firmly grounded in both precedent and U.S. trade law.

Appealing Chinese suppliers are required to submit their reply brief by May 7. Oral arguments, if required by the court, will likely occur this June. The court’s final decision is likely to be announced this fall. In the meantime, the Commerce Department’s decision remains in effect and the U.S. Customs Service will continue to collect antidumping duties on imported Chinese concentrate.

Additional Background
An industry-wide coalition of apple associations, processors and concentrators administered by USApple, oversaw the apple industry’s antidumping initiative. The Coalition for Fair Apple-Juice Concentrate Trade (FACT) filed its antidumping complaint on behalf of the following domestic concentrate producers: Coloma Frozen Foods, Inc., Coloma, Mich.; Green Valley Packers, Arvin, Calif.; Knouse Foods Cooperative, Inc., Peach Glen, Pa.; Mason County Fruit Packers Cooperative, Inc., Ludington, Mich.; and Tree Top, Inc., Selah, Wash.

For more information, please contact USApple at (703) 442-8850.

The U.S. Apple Association (USApple) is the national trade association representing all segments of the apple industry. Members include 40 state apple associations representing 9,000 apple growers throughout the country, as well as nearly 500 individual firms involved in the apple business. USApple’s mission is to provide the means for all segments of the U.S. apple industry to join in appropriate collective efforts to profitably produce and market apples and apple products.