Cablegate: Vietnam's Catfish Farmers Petition Consulate General,

Published: Tue 15 Jul 2003 06:31 AM
This record is a partial extract of the original cable. The full text of the original cable is not available.
State pass to USTR for Bryan
USDOC for 3132/OIO/EAP/Kelleher
USDOC also for 1431/MAC/AP/HPPho
USDOC also for ITA/IA/5120/4230/2130
E. O. 12958: N/A
Introduction and Summary
1. On July 9, three fish farmers representing the Fisheries
Association of An Giang, the province in the Mekong Delta where
most of Vietnam's tra and basa fish are raised and processed, met
with CG and Econoff at the Consulate General. Indicating they
represent about 40,000 farmers and family members involved in fish
farming, they delivered a petition signed by more than 200 fish
farmers protesting the anti-dumping margins set by the U.S.
Department of Commerce on frozen basa and tra fillets and asked
that the margins be reconsidered or delayed. The petition itself
was addressed to the Chairman of the ITC, the Secretary of
Commerce, and the U.S. Consul General. Hard copies of the
petition and signatures will be forwarded to the ITC and the
Department of Commerce.
2. The petitioners were represented by three fish farmers, all of
relatively modest means. Although large fish raising operations
do exist in the Delta, most fish farmers work on houseboats that
sit atop large fish cages floating in the Mekong River. Farmers
typically live in these boats with their families. Two of the
farmers who presented the petition owned one cage each, and one
farmer, who spoke a bit of English, owned four cages. All of the
men were extremely polite, and made their points energetically,
but with courtesy.
June 17 Final Determination Brings Hard Times
3. The fish farmers stated they were representing about 40,000
farmers and family members who have been affected by the anti-
dumping margins. They stated that although they believed
Vietnamese fish processors would still continue to make money, the
brunt of the anti-dumping measures had fallen squarely on the
shoulders of the fish farmers. They pointed out that since the
June 17 final determination had been issued, fish prices had
fallen from about 10,000 -12,000 VND (65 -77 US cents) per kilo to
about 8,500 VND (55 cents) per kilo currently. They had been
higher earlier in the year. To break even, the farmers estimated
they had to clear about 10,000 VND per kilo. The men were very
concerned that they would be unable to sell their current fish
stocks without incurring substantial losses. Even as prices
remained low, they noted, they still had to feed the fish. They
were also worried the fish were growing larger than the size
preferred by the processors, which would further depress the
4. When asked if they would be able to convert to raising other
varieties of fish, they said that they would try to start raising
roughy or tilapia, but they still had to unload their current
stocks of tra and basa fish, which would push them into (further)
We Can't Afford to Be "Dumping"
5. The fish farmers also argued that they had not been "dumping"
their product on the U.S. market. Although prices had fluctuated
even before the anti-dumping case, the farmers could not afford to
go without profits. They pointed out that many fish farmers had
to borrow against the value of their boats to secure funding and
that they did not have enough capital to sustain losses. Thus
their current problem of disposing of their current stocks of tra
and basa was extremely troubling. They also pointed out that they
buy their fish food and sell their fish at market prices - not at
prices set or guided by any government authority. Prices were low
relative to the U.S., they noted, because of An Giang's natural
environment, which is conducive to raising fish, low labor costs,
and the fact that much of the labor was from family hands.
6. The three fish farmers asked the CG to pass along their views
and for the USG to lower the margin rates or at least delay their
imposition until current stocks could be sold.
"You Mean We Came All This Way for Nothing?"
7. CG Yamauchi thanked the farmers for their visit and assured
them that she would pass along their views. CG and Econoff then
briefly outlined the process of an anti-dumping investigation and
determinations. The CG noted the process was quasi-judicial and
allowed for public comment. Anti-dumping cases are allowed under
the Bilateral Trade Agreement and the U.S. mechanism is in line
with WTO guidelines. During the anti-dumping case, both the GVN
and the Vietnamese industry had availed themselves of the
opportunity to supply additional information and comment. If
Vietnam were a WTO member, she noted, Vietnam would have the right
to take the decision to the WTO. She also noted that by law the
U.S. Consulate had no role in the investigation or in the
determination. Econoff also clarified that at this point in the
process, the margins had been already set and that the ITC
decision, coming at the end of this month, is based on a
determination of whether the U.S. catfish industry is actually
suffering or facing the threat of material injury. The ITC could
not revise the margin rate, nor do they have the authority to
delay imposition of the margins. The farmers seemed surprised to
learn this, and one of the farmers stated: "So you mean that after
coming here we have to go back to An Giang with nothing?"
8. Comment: It is difficult not to feel sympathetic toward these
fish farmers, who went to considerable effort to travel the 6
hours by car from An Giang Province to Ho Chi Minh City to state
their case. Each has been farming for at least 10 years, one for
more than 20 years. Their dark tans and calloused hands testify
to their hard work. They have earned a reasonable living, and by
rural Vietnamese standards are relatively well-off. Just the
same, however, most of their assets are tied up in the boats they
live on and the fish inside the floating cages underneath. In at
least the short term they will face substantial losses. In time,
according to these farmers, it is likely many farmers will be able
to switch to other varieties of fish. If enough do so, and demand
for tra and basa continue to expand in non-US markets, prices will
once again rise. The farmers' biggest worry now is whether or not
they can sell their stocks without losing so much money that they
go out of business before they even get a second chance at raising
different fish.
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