New Zealand Seeks Tariffs on Potato Imports
Imports of cheap potato products from Europe have recently surged in New Zealand, a trend that Potatoes New Zealand predicted was a possibility after the European producers were left with a surplus of spuds, following the weeks of lockdown on the continent.
Chief Executive Chris Claridge said that fear is now a reality; with trade data showing exports of frozen potato products from the EU to New Zealand are up about 50%.
As a result, Potatoes NZ has filed a complaint of “dumping” with the Ministry of Business, Innovation and Employment (MBIE) and applied for tariffs to be imposed on imports of the products.
Claridge said New Zealand’s five potato processors and the 450 people they employ would be the first to feel the effects of the dumping, with the imported products likely to sell for between 18% and 38% less than local options.
“The damage this will cause will destroy the New Zealand industry,” he said.
Dumping occurs because overseas producers have a glut of produce or a collapse in demand in their own markets, and both these conditions are unlikely to be sustained, Claridge said.
“A longer term consequence for consumers is that they could face higher prices if New Zealand-based processors and growers are forced out of business by the dumping.”
A report from Business and Economic Interest Limited (BERL), commissioned by Potatoes NZ, found that in the absence of a duty, potato processors would be forced to cut production and demand for locally grown potatoes would drop.
“Inevitably, this would lead to a loss of employment and a threat to the viability of some potato growing businesses. The imposition of an anti-dumping duty on dumped imports of frozen potato products would help to maintain demand for New Zealand-grown potatoes, and ensure the continuity of employment and business in the growing sector,” the report said.
MBIE will review the Potatoes NZ application to decide if there are grounds for investigation. If an investigation is launched, it could take up to 270 days.
However, provisional anti-dumping duties can be applied after the first 60 days of an investigation.
New Zealand’s potato industry contributes just over AUD1bn a year to the economy. Locally processed potatoes account for 55% of that value.