Dept. of Commerce Action on Mexican Trade Case

Dept. of Commerce Action on Mexican Trade Case

The statement below from the American Sugar Alliance describes action taken today by the U.S. Department of Commerce (DOC) in regard to dumped and subsidized sugar from Mexico.  This announcement is the next normal step in the process we undertook in filing anti-dumping and countervailing duty cases against Mexican sugar.  It represents the DOC’s final calculation of the size of the duties it would apply to Mexican sugar.  However, as you’ll recall, the U.S. and Mexican governments negotiated Suspension Agreements last December that prevent duties from being applied and that place Mexican sugar exports under a needs-based system controlled by the USDA. Separate from this DOC announcement the International Trade Commission will soon be making its final determination on whether the U.S. sugar industry was injured by Mexican exports.  That decision will be announced on October 20, 2015.

WASHINGTON—The U.S. Department of Commerce (DOC) today ruled that Mexico’s sugar industry unfairly dumped subsidized sugar onto the U.S. market. Mexico’s sugar industry was found to be dumping at margins of 40.48 percent to 42.14 percent and subsidized from 5.78 percent to 43.93 percent. Mexico’s government-owned sugar mills were subsidized at 43.93 percent.

The final ruling upholds a preliminary finding made in 2014 and comes after an exhaustive U.S. government examination into Mexico’s sugar industry.  Phillip Hayes, a spokesman for the American Sugar Alliance, issued the following statement in response:

“The DOC’s finding validates our claim that U.S. farmers, workers, and taxpayers were harmed by subsidized Mexican sugar flooding the U.S. market.  U.S. trade law exists to ensure that predatory trading practices like these don’t drive efficient domestic industries out of business, and today proved that the process works.  We expect a similarly positive outcome when the U.S. International Trade Commission issues its final ruling in the matter next month.”

The DOC examines subsidies and dumping by foreign trading partners, whereas the ITC determines if such unfair trade actions financially harm American businesses.  The ITC conducted a public hearing about Mexico’s sugar industry yesterday and is scheduled to vote on October 20.

The antidumping and countervailing duty investigations, which began last spring, were temporarily suspended following an agreement between the U.S. and Mexican governments in December.  Those investigations recommenced earlier this year following an appeal.

If the ITC rules in the U.S. sugar industry’s favor, the negotiated settlement between the two governments will remain in effect.