February 15-18, 2009 Washington State Convention Center Seattle ...

THE IMPACT OF CATFISH IMPORTS ON THE U.S. CATFISH INDUSTRY
Andrew Muhammad, Sammy J. Neal and Terrill R. Hanson
Mississippi State University
Department of Agricultural Economics
Mississippi State, MS 39762 USA
muhammad@agecon.msstate.edu
The recent increase in catfish imports is of great concern to the U.S. catfish industry. The importing of tra, basa, and channel
catfish at relatively lower prices has resulted in less catfish purchased from U.S. farmers and processors. Claims have been
filed with the U.S. International Trade Commission (ITC) accusing Vietnamese exporters of selling catfish to the U.S. at less
than fair market value. Consequently, the U.S. International Trade Commission ruled against Vietnam in 2003 and recommended
tariffs from 37% to 64%.
The primary objective of this research is to assess the impact of the Vietnamese tariffs on the U.S. catfish industry. In this study,
we develop a supply and demand model of the U.S. catfish industry at the farm and wholesale level. In this model, we incorporate
the affects of imports and estimate the short-run and long-run effects of changes in import prices on U.S. prices, quantities
and welfare at the farm and wholesale level. Additionally, supply and demand elasticities are also estimated.
Preliminary Results
Tariff results are reported in Table 1. Average tariff rates 20.35%, 28.05% and 35.20% are considered. Without any tariff, U.S.
price and quantity at the wholesale level is $2.52/lb and 65 million lbs, respectively. Buyer and producer surplus are $114 and
$97 million, respectively. Revenue is $165 million. U.S. price and quantity at the farm level is $.90/lb and 145 million pounds
respectively. Buyer and producer surpluses are $27 and $121 million, respectively. Revenue is $138 million.
Given the maximum average tariff rate of 35.2% on imported catfish, U.S. wholesale price will increase by $.08 per pound and
quantity increases by 1.2 million lbs. Farm prices increase by $.02 per pound and farm quantity increases by 1.6 million lbs.
The changes in surplus (welfare) and revenue due to the tariff are also reported in Table 1.
Table 1. The Impacts Tariffs on The U.S. Catfish Industry
Vietnam
Tariff (%)
Price
($/lbs)
Quantity
(000 lbs)
Buyer
Surplus
($000)
Producer
Surplus
($000)
Revenue
($mill.)
Wholesale
Level
$2.52 65,427 $ 114,348 $97,449 165
20.35 +0.05 +690 +240 +3,910 +3
28.05 +0.07 +950 +348 +5,200 +4
35.20 +0.08 +1,200 +417 +6,420 +5
Farm
Level
$0.90 153,276 $27,810 $121,190 138
20.35 +0.02 +919 +335 +3,472 +4
28.05 +0.03 +1,260 +459 +4,763 +5
35.20 +0.04 +1,599 +584 +6,058 +7
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