SOUTH AFRICA – The United States International Trade Commission (ITC) has ruled that there is a reasonable indication that South Africa and Brazil were “injuring the US market” with their exports of lemons juice at less than fair value.
In response to that, the U.S. Department of Commerce will continue with its investigations on the matter over the next few months to determine if there is dumping and, if so, to what extent. If required, they will then consider protective measures.
As part of the investigations, South African and Brazilian authorities have received questioners from the USITC, unpacking sales, costs and the pricing of its products.
The associations, which represents processing and packaging companies for fruit juice concentrate, pulps and purées that operate in both local and export markets, have until the end of March to respond to the set of intensive questionnaires
This will then be followed by months of research along with investigations to the final decision on what the new duty structure would be like.
“We could come out clean in this process and there will be either none or minimal duties. The other possibility is that they would put in fairly high duties,” said General manager of the South African Juice Association (Saja), Rudi Richards.
The issue was brought to the spotlight in December by Ventura Coastal, an American fruit juice producer, which filed an anti-dumping application against lemon juice from South Africa and Brazil.
According to a summary of the petition, Ventura asked the ITC for a 128.61 percent anti-dumping duty against exports of lemon juice from South Africa and 555.22 percent against Brazil, highlights IOL.
It is important to note that the products covered under the investigation includes lemon juice for further manufacture, with or without the addition of preservatives.
The scope also encompasses lemon juice blended with lemon juice from sources not subject to the investigation.
Excluded from the investigations is lemon juice at any level of concentration packed in retail-sized containers ready for sale to consumers, typically at a level of concentration of 48 GPL and beverage products such as lemonade that typically contains 20 percent or less lemon juice as an ingredient.
SA exporters to search for alternative markets
If dumping is found in the US and duties are imposed, it puts the lucrative export under threat as the excess SA volumes will be forced to move to smaller markets, further suppressing prices and increasing the probability of anti-dumping actions in those markets.
South African exports of lemon juice have been growing at a brisk pace, up 61 percent from 2018 to 2021, so any restrictions will knock the lemon industry, reports IOL.
Citrus exports have been a green shoot for South African growers in recent years. The 2021 overall citrus produce, according to the Citrus Growers Association of Southern Africa, broke all season records, with an estimated 158.7 million cartons, 130 million cartons exported in 2019, followed by 146 million cartons in 2020.
Key markets for SA citrus include China, India, the Philippines, Japan, Vietnam and the EU. But the US is the biggest aggregate market: R165m worth was exported from SA to the US in 2021, up 61% from R102m in 2018.