CHILEAN SALMON TARIFF COULD SEND SUPERMARKETS REELING

JONNA CRISPENS

WASHINGTON, D.C. -- Supermarket retailers may see an increase in salmon prices if recommendations by the Department of Commerce for tariffs on many Chilean salmon imports are approved by the International Trade Commission here.

The DOC's recommended tariffs, which will be accepted or rejected by the ITC on or by July 15, follow an 11-month DOC investigation based on allegations by eight U.S. salmon producers in Maine and Washington State, who are represented by the Fair Atlantic Salmon Trading coalition based in Brewer, Maine.

Any decision on tariffs will be of importance to retailers, since per capita consumption of salmon in the United States continues to climb. It rose 267% from 1987 to 1996, an increase that moved it from eighth on the list of top 10 seafoods consumed in the United States to number four.

In statements, the U.S. producers allege that Chilean salmon producers have received subsidies from their country's government, and that they engaged in industrywide dumping with margins of 42%.

As a result of its investigation, the DOC concluded that the Chilean government does not subsidize its country's salmon industry, but that several of the country's producers have been abusing the acceptable 2% "dumping margin" permitted by the United States.

Based on that determination, the DOC recommended a number of tariff rates ranging up to 10.91%, depending on the producer. Chilean salmon imports haven't previously been subject to tariffs.

The DOC's tariff recommendation is raising concern among such organizations as the Salmon Chile Information Bureau, a group here that represents Chile's salmon producers; and the Seattle-based Salmon Trade Alliance, which represents more than 80 U.S. companies and trade alliances that use salmon from Chile.

Both organizations are voicing particular concern over the method used by the DOC to establish the rates for uninvestigated companies.

Out of the approximately 70 Chilean firms exporting salmon to the United States, the DOC investigated the five largest, holding each accountable for its own individual abuse; it also calculated a tariff for the country's remaining, uninvestigated producers by taking a weighted average based on any abuse discovered through the investigation of those five companies.

The top two companies -- Camanchacu and Marine Harvest -- were found to be operating within the acceptable 2% "dumping margin," and were not levied any tariff. The remaining three, however, were found to be in varying degrees of violation.

Marcus Australes, the third largest exporter to America, exceeded the limit with a 2.24% dumping margin; Aguas Claras was the fourth largest (an 8.27% margin); and Eicosal was fifth (a 10.91% margin).

Thus, the DOC recommended tariff rates of 2.24%, 8.27% and 10.91%, respectively, for those companies, and took the weighted average of the three to arrive at a 5.19% tariff for "all others," a category representing the rest of the industry.

Rodrigo Infante, general manager of the Santiago, Chile-based Association of Chilean Salmon Farmers, called the finding of any abuse by the DOC "unfortunate," but said it was 'extremely unjust" to create a dumping margin for companies that have never been investigated on account of three companies that were found to be in abuse.

"They will be unfairly put at a disadvantage just because they are located in Chile," he said. Infante said his association expects the ITC to rule against the levying of any dumping margins.

Said Mark Spatz, director of the Salmon Trade Alliance: "The DOC's ruling continues to frustrate our members, especially those who are affected by the 'all others' rate.

"These companies, which make up about 60% of Chile's production, were not investigated, yet their imports are taxed at a rate based on only three companies."

If the ITC accepts the DOC's recommendation, the tariffs will remain in effect for one year, at which time Chilean salmon producers may request a reinvestigation. Depending on any new findings, the tariffs may then by lifted, lowered, re-instated or raised retroactively.

Most of the salmon consumed in the United States originates from domestic, Chilean and Canadian sources, with Chile accounting for about 90% of an estimated 77.4 million pounds of fresh farmed Atlantic salmon fillets sold, and about 28% of an estimated 124.6 million pounds of fresh farmed Atlantic dressed salmon sold in 1997, according to ITC figures.

By comparison, U.S. producers accounted for only 5% of the fillets sold and 22% of the dressed salmon sold, and Canada accounted for approximately 5% of the fillets sold and 50% of the dressed salmon sold.