By Max Fisher, Vice President of Economics and Government Relations
The U.S. Trade Representative’s Office (USTR), U.S. Department of Agriculture (USDA), and U.S. Department of Commerce jointly announced on Sept. 1 their plan to address imports of seasonal and perishable fruits and vegetables.
The main pillar of the plan is for the U.S. International Trade Commission to initiate a Section 201 global safeguard investigation to determine the extent to which increased imports of blueberries have caused serious injury to domestic blueberry growers. A Section 201 investigation for strawberries and bell peppers could follow later in 2020, the federal agencies indicated.
In addition, USTR said it will pursue senior-level government-to-government discussions with Mexico over the next 90 days to address U.S. industry concerns regarding U.S. imports of Mexican strawberries, bell peppers, and other seasonal and perishable products. Among other actions, USDA will develop a market promotion strategy for domestically produced produce.
Under Section 201, the U.S. International Trade Commission determines whether an article is being imported in such increased quantities that it is a substantial cause of serious injury to the domestic industry. If the commission makes an affirmative determination, it recommends to the president relief that would prevent or remedy the injury and facilitate industry adjustment to import competition. The president makes the final decision whether to provide relief and, if so, the amount of relief.
Section 201 does not require a finding of an unfair trade practice, as do the antidumping and countervailing duty laws and Section 337 of the Tariff Act of 1930. However, the injury requirement under Section 201 is considered to be more difficult to prove than those of the unfair trade statutes. Section 201 requires that the injury or threatened injury be “serious” and that the increased imports must be a “substantial cause” of the serious injury.
Leading up the announced plan, USTR, USDA and the Commerce Department jointly conducted two public hearings to discuss foreign trade practices that may be harming American growers of seasonal and perishable produce. At the hearing, the southeastern seasonal and produce industry requested import restrictions, specifically Section 301 tariffs. Other agricultural witnesses, including the produce industry from the West Coast, urged the U.S. government to avoid steps that would place U.S. agricultural exports in the crosshairs of a trade dispute with Mexico.
The decision to conduct a Section 201 investigation means the U.S. International Trade Commission must report its injury finding to the president within 180 days of receiving the petition. It is unlikely a determination will be made before the November election.