The Impact of the Andean Trade Preference Act Twelfth ... - USITC

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U.S. production of fresh-market asparagus amounted to 141.4 million pounds in 2005, down7 percent from 152.4 million in 2004 but up by 18 percent from 119.4 million in 2003. 138Production value fell 26 percent from $185.5 million in 2004 to $137.9 million in 2005, butwas up 10 percent from 2003 to 2005. 139 The leading states producing fresh-marketasparagus were California (which sells nearly all of its production to the fresh market),Washington, and Michigan. The leading states producing asparagus for processing wereWashington and Michigan. Washington asparagus growers have sold more of theirproduction on the fresh market and less to processing in recent years following the closingof three asparagus processing plants in Washington since 2002. 140 Michigan asparagusgrowers also have sold more of their asparagus to the fresh market in recent years, but theyreport that lower prices for their asparagus for processing forces more asparagus to be soldto the fresh market, which is already supplied by imports. The lower asparagus prices aresaid to have resulted in many growers going out of business. 141 U.S. annual per capitaconsumption of fresh-market asparagus amounted to 1.2 pounds in 2005, up slightly from2004 but twice the per capita consumption in the early 1990s. 142 Per capita consumption ofcanned and frozen asparagus has been stagnant, at 0.2 and 0.1 pounds, respectively, for anumber of years. 143Historically, the season for U.S. production has differed substantially from that of mostimports from ATPA countries. Production in California typically starts in February, peaksin April, and continues through June. Production in Washington and Michigan starts in Apriland ends in July. About 70 percent of imports from Mexico in recent years entered duringJanuary-March, just prior to and at the start of the California season. The bulk of freshasparagus imports from ATPA countries enter during July through the following January,when overall U.S. production is low. In recent years, however, imports from ATPA countries(mainly Peru) have entered in larger amounts during most other months as well, but stillaccount for a fairly small market share in those months.According to recent USDA statistics, prices for California asparagus are often at a seasonallow level during January-March as domestic production increases. With U.S. productionhighest during the period of mid-February through mid-May and with supplies from Mexicoalso available, the price of fresh asparagus may approach a level at which it is not asprofitable for importers to sell foreign asparagus in the U.S. market, leading to a reductionin imports from Peru and other shippers.The impact of ATPA on U.S. consumers has been significant in that imports of Peruvianfresh-market asparagus, together with imports from Mexico and U.S. production, have138 USDA, National Agricultural Statistics Service, Vegetables, publication No. Vg 1-2 (06), Jan. 2006, p.35.139Ibid.140Don Brunell, President, Association of Washington Business, “Seneca Announcement LeavesWashington’s Asparagus Industry on Life Support,” June 4, 2004, found at http://www.awb.org/cgi-bin,retrieved May 24, 2005. According to industry officials, imports of fresh Peruvian asparagus “have closedU.S. canning operations.” See also John Bakker, Michigan Asparagus Advisory Board, written submission tothe Commission concerning inv. No. 332-352, Andean Trade Preference Act: Impact on U.S. Industries andConsumers and on Drug Crop Eradication and Crop Substitution, June 7, 2005.141 John Bakker, Michigan Asparagus Advisory Board, written submission to the Commission concerninginv. No. 332-352, Andean Trade Preference Act: Impact on U.S. Industries and Consumers and on DrugCrop Eradication and Crop Substitution, June 7, 2005.142USDA, Economic Research Service, Vegetables and Melons Outlook, publication No. VGS-314, Apr.20, 2006, Percap table 1.143 Ibid.3-12
esulted in greater availability of fresh asparagus throughout the year. This extendedavailability of fresh-market asparagus, together with the overall consumer awareness of, andpreference for, healthy foods, may be mostly responsible for a two-fold rise in per capitaannual consumption of fresh asparagus over the past decade. 144 The increase in productavailability throughout the year also may have resulted in lower retail prices for consumersin 2005, especially in those months when U.S. production is minimal. Furthermore, theoverall supply of asparagus is said to have outpaced demand in the United States, loweringthe prices received by Peruvian exporters to the U.S. market. 145Exports of fresh asparagus from Peru increased by 71 percent in volume from 2001 to 2004and by 11 percent from 2004 to 2005. 146 The United States has been the major export marketfor Peruvian shipments of green asparagus for a number of years, accounting for about 74percent of such exports in 2005. 147 Although there is no official Peruvian government policyencouraging asparagus production, 148 the Peruvian asparagus industry provides jobs for anestimated 70,000 workers and has become an important part of overall economicdevelopment in Peru. 149 The marketing of Peruvian asparagus exports is being handled byPeru’s Export Promotion Committee (Prompex), 150 and the Peruvian Asparagus andHorticulture Institute (IPEH) provides assistance to growers and exporters in the areas offoreign-market promotion and development. 151USDA officials project that fresh asparagus imports from ATPA countries will continuerising in the near future, despite Peruvian industry comments that global demand for freshasparagus has flattened and U.S. prices for fresh asparagus have fallen. 152 Peruvian freshasparagus production rose 2 percent from 2004 to 2005 and was forecast to rise 2 percentagain from 2005 to 2006. 153 Peru is still one of the largest global producers of asparagus,with annual production levels greater than those in the United States and Mexicocombined, 154 and asparagus is now the leading agricultural export from Peru. 155 Changes inland tenure are attracting greater amounts of investment capital from investors seeking toinvest in the production of exportable crops such as asparagus with a stable foreigndemand. 156 In recent years, large tracts of land owned by cooperatives and once used forsugar production have been planted with asparagus. 157 Growers in Peru take advantage of afavorable climate and make use of drip irrigation in the dry season to produce high-qualityasparagus year round. 158144For more information, see USITC, ATPA, Ninth Report, 2002, p. 3-17.145 USDA, FAS, Peru Asparagus Annual 2006, GAIN Report #PE6008, June 2, 2006, p. 5.146 Ibid., p. 2.147 Ibid., p. 1.148Ibid., p. 6.149Ibid., p. 2.150Ibid., p. 6.151 Ibid., p. 6.152 Ibid.153 USDA, FAS, Peru Asparagus Annual 2005, GAIN Report #PE5009, June 10, 2005, p. 2.154USDA, FAS, “World Asparagus Situation and Outlook,” World Horticultural Trade and U.S. ExportOpportunities, Circular FHORT 7-04, July 2004, pp. 1-6, found at http://www.fas.usda.gov/htp/2004circlst.html, retrieved May 25, 2005.155USDA, FAS, Peru Asparagus Annual 2004, GAIN Report #PE4008, June 9, 2004, p. 2.156Ibid., p. 4.157USDA, FAS, Peru Asparagus Annual 2003, GAIN Report #PE3012, July 2, 2003, p. 3.158 USDA, FAS, Peru Asparagus Annual 2005, GAIN Report #PE5009, June 10, 2005, p. 4.3-13
Page 2 and 3:
U.S. International Trade Commission
Page 5:
PREFACEThe submission of this study
Page 17:
Trade-Related Activities in 2005•
Page 20 and 21:
Organization of the ReportThis chap
Page 22 and 23:
actions to withdraw or suspend coun
Page 24 and 25: textile and apparel articles made i
Page 26 and 27: duty-free entry are identical—a C
Page 28 and 29: analysis assumes that the supply of
Page 30 and 31: $11.1 billion in 2005 compared with
Page 32 and 33: Table 2-2 Leading U.S. imports for
Page 34 and 35: and 9.5 percent in 2004 to 7.7 perc
Page 36 and 37: 2-8Table 2-5 U.S. imports for consu
Page 38 and 39: 2-10Table 2-6 Leading U.S. imports
Page 42 and 43: Table 2-8 Textiles and apparel: U.S
Page 44 and 45: Virtually all flower imports from t
Page 46 and 47: The 2005 list of leading imports un
Page 48 and 49: Table 2-9 U.S. imports for consumpt
Page 52 and 53: cathodes, four apparel products, on
Page 54 and 55: 2-26Table 2-11 U.S. exports to ATPA
Page 56 and 57: 2-28Table 2-12 Leading U.S. exports
Page 58 and 59: Figure 2-5U.S. exports to ATPA coun
Page 60 and 61: EcuadorThe growth rate of the Ecuad
Page 63 and 64: CHAPTER 3ECONOMIC IMPACT OF ATPA ON
Page 65 and 66: Products That Benefited Exclusively
Page 67 and 68: Several leading imports that were i
Page 69 and 70: Table 3-3 Leading imports that bene
Page 71 and 72: Table 3-5 Estimated displacement ef
Page 73: more in 2004. 132 Asparagus and cut
Page 77 and 78: In recent years, some U.S. growers
Page 79 and 80: U.S. sales of domestically produced
Page 81 and 82: Table 3-6 Foreign direct investment
Page 83 and 84: product quality at the volumes requ
Page 85 and 86: $314 million purchase by Phillip Mo
Page 87 and 88: Industry sources attribute the slow
Page 89 and 90: place will have a devastating effec
Page 91 and 92: textile and apparel machinery and t
Page 93 and 94: Textile and Apparel SectorPeru has
Page 95: could begin producing the high-end
Page 98 and 99: Role of ATPA in Counternarcotics Ef
Page 100 and 101: (table 4-1, figure 4-1). 306 Net co
Page 102 and 103: Figure 4-1Net Coca Cultivation in t
Page 104 and 105: to other forms of legal justice. Th
Page 106 and 107: ulk of funding for the plan between
Page 108 and 109: Alternative DevelopmentThe USAID al
Page 111: APPENDIX AFederal Register NoticeA-
Page 114 and 115: 27278 Federal Register / Vol. 71, N
Page 117 and 118: American Chamber of Commerce of Per
Page 119 and 120: Government of Colombia—Colombian
Page 121: Peruvian Asparagus Importers Associ
Page 125:
Technical Notes to Chapter 3:Partia
Page 128 and 129:
(1)N(Q a /Q a N) = (1+t)ε aa(2)N(Q
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