May 29, 2013 / 8:06 PM / 6 years ago

UPDATE 1-U.S. sets preliminary duties on shrimp from Asia, Ecuador

(Adds details on duties, background)

WASHINGTON, May 29 (Reuters) - The U.S. Commerce Department on Wednesday set preliminary duties of up to nearly 63 percent on shrimp from Malaysia to offset government subsidies, but much lower duties on shrimp from China, India, Thailand, Vietnam, Indonesia and Ecuador.

The duties, which could be revised in August when the department completes an investigation, were welcomed by shrimp fisherman and processors in Texas, Louisiana, Mississippi, Alabama, Georgia, Florida and South Carolina who filed a petition last year seeking U.S. protection against foreign subsidized competition.

“The long-term survival of the entire Gulf shrimp economy from harvesters to processors depends on the outcome of this case, David Veal, executive director of the Coalition of Gulf Shrimp Industries, said in a statement.

The industry group was formed in December to support the petition urging the federal government to impose countervailing duties on the imports.

The United States imported more than $3 billion worth of shrimp in 2012 from the seven countries named in the case, making it one of the biggest in the department’s history.

That included $1.1 billion from Thailand, $634 million from Indonesia, $551 million from India, $500 million from Ecuador, $426 million from Vietnam, $142 million from Malaysia and $102 million from China.

The Commerce Department imposed preliminary duties on Malaysia of 10.8 percent to 62.74 percent. But other suppliers were subject to much lower duties of 2.09 percent to 11.32 percent.

For two countries - Ecuador and Indonesia - the amount of subsidies found by the Commerce Department was so low that no duties will be imposed, although that decision could be reversed in the department’s final determination in August.

Still, the duties on the five other countries averaged nearly 9 percent on a trade-weighted basis, said Elizabeth Drake, a partner at the law firm Stewart & Stewart, who was the lead counsel for the Gulf Shrimp coalition.

If the final levels are similar, “countervailing duties of more than $200 million would be assessed against importers. We believe these results would be dramatic in the market and would be very positive for domestic producers whose operating margins are often razor thin,” Drake said.

Reporting by Doug Palmer; Editing by Richard Chang

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