US Bans Shrimp: Thailand Must Adjust
May 14, 2004
Executive Summary

The US has imposed a ban on Thailand's export of shrimp caught from sea, or 'natural shrimp' to the US market, effective May 15, 2004, because Thai shrimp fishermen do not use Turtle Excluder Devices (TEDs). The ban on export of natural shrimp will affect only the exports of shrimp caught from natural sources, and canned shrimp that use natural shrimp as raw material. The total export value of this portion of shrimp exports is around USD52 million, or Baht2 billion. As only 5 percent of Thai shrimp products is derived from natural sources, this is not high. However, both related state and private sector entities should urgently adjust themselves to handle this changing situation by:
  1. Imposing a law that all fishing boats must install Turtle Excluder Devices (TED) - At present only some Thai fishing boats have installed this device, but there are still a large number that haven't done so. Therefore, in order to export sea shrimp to the US, all shrimp fishermen must invest in TEDs to conform with the US law, so that their business can survive. But a point that should be taken into consideration is that the Fisheries Department must follow-up on this and monitor the installation of TEDs on all fishing boats, so that the US will not be able to raise this point as an excuse to ban the export of natural shrimp and products because fishing boats do not all install the TEDs, and this is detected.

    Moreover, the detailed specification on the newest type of TED must be followed from news that after September 1, 2004, the US will require the use of this newer version which is wider so that more sea turtles can escape through larger holes. Related parties must closely follow this issue, in any case. If this news is correct and the US confirms that all Thai fishing boats must install this new type of device, the Fisheries Department must enforce a regulation that all boats must comply in order not to pay additional expense for a later second installation again.
  2. Detection and Collection of Natural Shrimp Catch - The Fisheries Department must make a list of all Thai shrimp trawlers. At present, the Fisheries Department is in the process of registering the names of these boats. In addition, the annual amount of shrimp caught from the sea must be collected. When these shrimp are processed, it must be ascertained how much of these processed shrimp will be consumed domestically, and how much is exported. These production details must be distinctly separated. If not, it could be used as evidence to confirm US suspicions that most Thai shrimp products are acquired from farming.

A point that should not be overlooked is that, in producing shrimp products, particularly canned and processed shrimps, at present some of the raw material used comes from shrimp imported from overseas, especially India, where shrimp are sea-caught. Shrimp imports from these sources account for 20 percent of all imported shrimp. Therefore, exports of shrimp products may be indirectly affected, if the US requires that the country of origin of the raw material must also be identified. However, damage to the value of shrimp products exported will depend on whether manufacturers can find other import sources to substitute for imports that are sea-caught. In addition, strict measures may be imposed on these countries of origin to attest that their shrimp are from farming in order to comply US regulations in their Sea Protection Law.
  1. Show the US that Thailand also has Equal Sea Turtle Protection Measures - Although Thailand has a Sea Turtle Protection Law, the problem is that the US may deem that law enforcement in this matter may not be as strict as it should be. Now, it is time for serious, continuous and strict enforcement to show the US that Thailand has an effective Sea Protection Law that is as strict as the US. This measure, together with enforcement where all fishing boats are required to install TEDs, will ensure Thailand's compliance with the US, which could release Thailand from the list of countries banned from natural shrimp exports to the US.
  2. Increase the Amount of Sea Shrimp Farming - Although 95 percent of exported shrimp come from farming, the worrisome issue is that breeding stock still need to be caught from the sea. Therefore, both governmental and private agencies should be urgently cooperate on research for increased breeding stock from farming. At present, the Fisheries Department has the necessary technology to proceed. It is expected that this type of shrimp breeding could substitute for sea shrimp by 50 percent. In implementation, a flagship project could be established where fishermen would be encouraged to join the project.
  3. Finding Substitute Markets - The government must urgently find substitute markets for natural shrimp and products, if these products cannot be exported to the US market. This measure will include encouraging Thaise to consume more shrimp and shrimp products. The government has already undertaken this measure, including finding substitute markets for export. Interesting export markets for chilled and frozen shrimp are Japan, Canada, China, Australia, Hong Kong and Taiwan. Meanwhile, interesting markets for canned shrimp include the EU, Australia, New Zealand and Hong Kong. However, in penetrating these markets, product types must be tailored to suit the demand of consumers in each country.
  4. Anti-Dumping Tariff Measures - Apart from the US's ban on natural shrimp and shrimp products from Thailand, exports of shrimp and their products from Thailand to the US market at present may face problems with import tariffs imposed for market dumping, together with five other countries that export shrimp to the US, which are Brazil, China, Ecuador, India and Vietnam. The news that the US may announce anti-dumping tariffs at the end of July 2004 must be closely followed. If this measure becomes reality, the impact to the export value of shrimp and shrimp products to the US market may be higher than if the US imposes a ban on Thai sea shrimp. However, a point that must followed is how large an anti-dumping tariff will be collected from Thailand, in comparison with the five other countries which are all important rivals in shrimp exports to the US. It is expected that the anti-dumping tariff rate for each country will be different, which will result in gaining or losing an advantage for each country in its exports.
  5. The Claim that Shrimp Farming in Coastal Areas Impacts the Environment - Another issue that may affect the export of shrimp to the US is the claim that shrimp farming in coastal areas impacts mangrove areas. Mangroves are a natural environment where marine embryos are bred and nurtured. Therefore, trespassing in mangrove swamps is considered tantamount to environmental harm, especially from news of research by international organizations, which state that coastal shrimp farming in many countries impact the environment. Therefore, related parties must be ready to handle this issue.

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