Dateline Washington Apr/May 2014

Mexico — On March 28, U.S. sugar producers and processors (the American Sugar Coalition) filed anti-dumping and countervailing duty petitions against subsidized and dumped imported sugar from Mexico due to that harm the imports have caused to U.S. producers and the violation of U.S. trade laws.

• Antidumping law allows the United States to collect anti-dumping duties after administrative determinations by the United States International Trade Commission (ITC) and Department of Commerce (DOC) that a foreign product is being sold in the U.S. market at less than fair value and that the imports are materially injuring (or threatening to materially injure) the U.S. industry.

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• Countervailing duty law allows the United States to collect duties to offset any unfair competitive advantage that foreign manufacturers or exporters might enjoy over U.S. producers as a result of subsidies after administrative determinations by the ITC and DOC that a foreign product is being subsidized and that the imports are materially injuring (or threatening to materially injure) the U.S. industry.

The petitions filed by the American Sugar Coalition document the sharp rise in dumped and subsidized sugar from Mexico and how that sugar has caused the collapse of sugar prices and injured all segments of the U.S. sugar industry.
Among the information highlighted in the petitions:

• Mexican sugar has been sold in the U.S. market at dumping margins of more than 40%.

• Mexican sugar producers have benefitted from substantial Mexican federal and state government subsidies.

• The share of the U.S. market captured by Mexican sugar has doubled since 2011, rising from about 9% to over 18% in 2013.

• Acreage devoted to sugar production in Mexico has increased by 66% since NAFTA went into effect, while acreage devoted to sugar production in the United States has declined by 11%.

• U.S. producers have lost a significant volume of sales to dumped and subsidized imports of Mexican sugar.

• Returns to U.S. sugarcane and sugarbeet farmers have declined to unsustainable levels, and American cane sugar refiners and millers and sugarbeet processors have seen their profits evaporate over the period of investigation.

The petitions are neither an attack on — nor an effort to change — NAFTA. Antidumping and countervailing duty cases are explicitly permitted by the NAFTA to ensure fair trade in the U.S. market.

• Mexico, the United States and Canada have prosecuted 114 antidumping and countervailing duty cases against each other since NAFTA went into effect. Mexico has filed 31 petitions against the United States, and the United States has filed 30 petitions against Mexico; the remaining cases involved Canada.


Biotechnology — In response to the anti-biotech activist efforts for mandatory labeling in various states, the agriculture and food industry have joined forces to propose a federal legislative solution to this problem. A bill will be introduced in the House of Representatives in early April that will address several key issues in the labeling debate.

This legislation would create a uniform, national program governing the pre-market review and labeling of genetically engineered foods. First, it would require the Food and Drug Administration (FDA) to conduct a safety review of all new plant varieties used for genetically engineered food before those foods are introduced into commerce.

Second, the legislation would create a new legal framework, subject to FDA oversight, governing the use of label claims regarding either the absence or use of genetically engineered food or food ingredients.

The legislation would also require FDA to develop a federal definition for “natural” claims on product labels. Given this new legal framework, states would be precluded from imposing any requirements that are not identical to these federal requirements.