Canada’s customs and trade watchdogs will look into claims by Ontario’s growers of greenhouse bell peppers that competitors from the Netherlands are dumping product on the Canadian market.
The Canada Border Services Agency (CBSA) announced Monday it has launched an anti-dumping investigation into a complaint filed by the Ontario Greenhouse Vegetable Growers.
CBSA’s investigation will cover “the alleged injurious dumping of greenhouse bell peppers originating in or exported from the Netherlands.”
According to CBSA, the OGVG, based at Leamington, southeast of Windsor, has alleged the dumping of Dutch peppers is harming Canadian production by causing “lost sales, price erosion, price suppression, reduction in gross margins and reduced profitability.”
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CBSA’s announcement means the Canadian International Trade Tribunal (CITT) will now start a preliminary inquiry to see whether the Dutch imports are harming Canadian production. The tribunal’s deadline for a decision is May 21.
CBSA, meanwhile, will rule by June 21 on whether the Dutch imports are being “dumped” by its definition.
“Dumping,” CBSA said, takes place when goods are sold to importers in Canada at prices that are less than their selling prices in the exporter’s domestic market, or at unprofitable prices.
If the CITT finds that an “unusually large increase in harmful imports” has taken place before the CBSA’s decision comes down, and justifies a retroactive application of an anti-dumping or countervailing duty, that duty could be slapped on Dutch bell peppers brought into Canada as of Monday (March 22).
Perishable commodity
According to the OGVG’s initial complaint, the Netherlands has a selling season for bell peppers that’s similar to the Canadian marketing season. Importers sell the Dutch product to wholesalers for the restaurant sector as well as retailers including larger chains such as Loblaws, Sobeys, Safeway and Metro.
The OGVG said it predicts a “significant risk” that Dutch peppers will be diverted in greater numbers to the Canadian market in 2010. Dutch pepper imports to the U.S. have been blocked since October, the group noted, for fear of shipments carrying false codling moth, a major fruit pest in Africa that has yet to establish itself in the U.S.
The OGVG, which represents 236 greenhouse growers, has 41 members who grew bell peppers in 2009, who it says represent about 60 per cent of the value of Canadian bell peppers grown. The other 40 per cent comes mostly from B.C. greenhouses.
Specific numbers were blanked out of the complaint posted by the CBSA, but the Ontario growers said that “as an industrialized country, it is believed that the cost structure in the Netherlands would be very similar to that of Ontario greenhouse bell pepper growers.”
Peppers being a perishable commodity, prices “fluctuate to what is necessary to clear the market,” the OGVG wrote. “With Dutch peppers being flown (and shipped) to Canada, and being offered at extremely low dumped prices, the Canadian market price is continually being disrupted.”
