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Local pangasius industry to face more hurdles as US Congress passes new law

Local pangasius industry to face more hurdles as US Congress passes new law

Friday, February 07, 2014, 14:30 GMT+7

The exports of Vietnamese tra fish, or pangasius, to the US will face major difficulties as the US Congress has recently passed the Farm Bill, which contains provisions directly affecting the Vietnamese industry.

After over a year of debate, the U.S. Senate on Tuesday passed the budget bill for farm subsidies, better known as the Farm Bill, including a provision making it difficult for catfish products to be exported from Vietnam.

The terms that directly affect the exports of foreign products are new regulations that meat, fish, and eggs imported into the U.S. must have country of origin labels confirming that the foreign farming and processing environment is compatible with that of America.

In addition, the US congress also approved the transfer of the function of monitoring catfish, including pangasius from Vietnam, to the U.S. Department of Agriculture (USDA) from the US Food and Drug Administration (FDA).

Dao Tran Nhan, Vietnamese Minister Counselor for Trade in the US, told Tuoi Tre that Vietnam will take at least 5 to 7 years to upgrade farming and processing standards so that they can meet the cultivation, production, and processing standards in the U.S. before they can resume exports to the U.S., based on the provisions of the new Farm Bill.

“In other words, there are fewer chances for Vietnamese seafood to enter the U.S. market after the law is passed.”

The press release posted on the website of the Embassy of Vietnam in the United States also launched a protest for the new law.

“In failing to repeal the United States Agriculture Department's Catfish Inspection Program as part of the 2014 Farm Bill, the United States Congress has ignored its commitments to free and fair trade and its developing partners in Asia.” “This program is an unjustified regulatory measure designed not to improve food safety but to deny access to the U.S. market for Vietnamese fish. As WTO members, the United States agrees to certain responsibilities and Vietnam has certain rights that it can exercise in the wake of this regrettable Congressional inaction.” "American farmers and ranchers exported $1.6 billion in goods to Vietnam in 2012, a number that is expected to increase. In return, the United States Congress is adopting a protectionist measure against Vietnamese fish, and that’s totally unfair,” said Vietnam's Ambassador to the U.S. Nguyen Quoc Cuong. Both the United States and Vietnam are in important Trans Pacific Partnership negotiations.  “We urge the U.S. to be consistent in both its requests of others and its own actions," Ambassador Cuong added.

The U.S. is the largest import market of Vietnam catfish today with $351.3 million in the first 11 months of 2013, up 4.6% compared to the same period in 2012.

Last week the U.S. House of Representatives passed the bill with 217 votes in favor and 210 votes against it. President Barack Obama is expected to sign the bill soon so that it can be put into practice.

According to a Vietnam News Agency correspondent in Washington, the bill, which will allocate $956 billion in the next 5 years to expand the guarantee of the federal government for American farmers, was passed with 68 votes in favor and 32 votes against it.

Seafood exports to the U.S are expected to reach $1.74 billion in 2013, up 6.7% year on year, according to the Vietnam Association of Seafood Exporters and Producers (VASEP).

More barriers set

In September of last year, the Vietnam Association of Seafood Exporters and Producers (VASEP) raised its voice against the US Department of Commerce’s (DOC) decision to impose anti-dumping taxes on Vietnamese pangasius exporters after the 9th administrative review (POR9).

VASEP has also asked the DOC to keep Bangladesh as the country of reference, instead of Indonesia, for the calculation of input costs of Vietnamese pangasius products like it did in the past.

According to the DOC's preliminary decision, the taxes will be imposed on any Vietnamese pangasius exporters who sent their fillet products to the US between August 1, 2011 and July 31, 2012. Under the decision, the duties on products of Vinh Hoan and Hung Vuong, two mandatory reviewed companies, will be $0.42 per kg and $2.15 per kg, respectively.

The rates for other voluntary companies will be $0.99 per kg and $2.11 per kg for the rest. VASEP made the same move in early July, stating that it would continue to pursue justice against such irrelevant and unreasonable tax rates for the sake of Vietnam’s pangasius industry.

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