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Iowa Honey Producers Association |
The Buzz Newsletter October 2005 |
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Legislative Update Reprinted from the AHPA magazine the Honey Producer. Great News! Late in the afternoon of July 27, 2005, the U.S. House of Representatives passed the English/ Thomas Bill H.R. 3283 titled “United States Trade Rights Enforcement Act.” The center piece of the bill dealt with closing the bonding loophole and called for a report to be submitted to the House Ways and Means Committee and the Senate Finance Committee. This report is to “describe the major problems experienced in the collection of duties, including fraudulent activities intended to avoid payment of duties, with an estimate of the total amount of uncollected duties the previous fiscal year and the reasons duties were uncollected.” The Bill is broader than we’d liked to have seen, covering intellectual properties, countervailing duties, etc. We’re hopeful we can work out a compromise between the House version and the Senate’s simple version which passed 100-0 last fall but unfortunately died when the Senate adjourned in December 2004. We now must go back and ask the Senate to take up the bill again. We presently have close to 30 cosponsors on the new bill. AHPA president Steve Park, Lyle Johnston, Jack Meyer, Jr., Dale Althoff, Jerry Probst, and I will be going to Washington the week of September 12th to try and negotiate an agreement that is acceptable to both Houses. We’re very fortunate that there is absolutely no disagreement in either House on the need to close the bonding loophole. We, optimistically, hope to have the loophole closed by the middle of October. Ron Phipps, in his July 28, 2005 Market News Report stated the following: “With the now inevitable closing of the loophole, the industry can foresee the ending of the era of the erosion of honey prices due to Chinese new shippers posting bonds and neither paying cash nor factoring in their selling prices, antidumping duty (ADD) liabilities. As the industry has witnessed, the past year has been a retrogressive sequence of events characterized by ever falling honey prices of honey from Chinese new shippers who without knowledge or experience in the U.S. honey market appeared like mushrooms in a rainy night. The “new shippers” which appeared as mushrooms in a rainy night will disappear like thieves in the night.”
We also received GOOD NEWS from the Department of Commerce on Tuesday, June 28, 2005. Commerce released its final results of its second administrative review (AR) of the dumping order on honey from China. All of the final margins either went up significantly from the preliminary margins, or held at the preliminary level. Wuhan Bee Healthy’s final dumping rate for the 2nd AR is 101.51%, up from 5.69% from the preliminary results. Wuhan’s going forward cash duty deposit rate (DDR) will now increase from its current 32.85% to 101.51%. Shortly after Commerce announced its preliminary results of the 2nd AR, Dubao completely withdrew from the review rather than respond to Commerce’s additional requests for information. As a result, Commerce based Dubao’s dumping margin on “adverse facts available” in the final results, and awarded the exporter the top “China-wide” rate of 183.80%. This will be Dubao’s going forward cash DDR, up from its current rate of 21.61%. The final dumping margins for each exporter that participated in the review are as follows:
You will notice the lowest cash DDR is 38.60%. When the loophole is closed and Chinese exporters are required to put up cash, the cheapest any Chinese honey can legally be sold for in the United States will be $1.04 per pound. Anything Below that price will be considered dumping. Challenging the deposit rates on every company that requests either an administrative review or a new shipper review is expensive. Left unchallenged Wuhan Bee Healthy’s rate would be 5.69% rather than 101.51%. When you see the results of Mike Coursey’s efforts, you know it’s worth every penny. Richard Adee
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