LITTLE ROCK — Tyson Foods Inc., the largest U.S. chicken processor, said Monday it will try to appeal China’s decision to impose anti-dumping tariffs on U.S. chicken shipments.
“We’re disappointed by the news and will continue to work through the U.S. government and our trade associations to reverse this decision,” Gary Mickelson, a spokesman for Springdale-based Tyson, said in an e-mail. “We intend to do everything we can to continue selling chicken profitably to China, as well as seek ways to expand our poultry exports to alternative markets.”
China implemented a duty starting Monday of as much as 105.4 percent on U.S. broiler chicken products. The move establishes duties China put into place in February and raises the bottom of the range of duties enacted at that time.
China’s Ministry of Commerce said in February an initial investigation showed that the U.S. provides subsidized soybeans and corn to its poultry industry, hurting Chinese producers.
The Commerce Ministry started the investigation less than two days after President Barack Obama imposed steep tariffs on Chinese tires a year ago. Chinese officials have denied that the inquiry was in retaliation, but poultry is one of the few categories in which the United States runs a trade surplus with China, making it an ideal target for Chinese trade actions.
The rate will be 50.3 percent to 53.4 percent for U.S. companies that cooperated with China’s investigation and 105.4 percent for those who didn’t, the Ministry of Commerce said Sunday. Tyson Foods imports will be as-signed a 50.3 percent duty.
The decision was made after China determined “a causal relationship” between U.S. companies dumping their products in the Asian nation at below market prices and losses in the Chinese poultry industry.
Mickelson declined to comment on whether the tariff would curb Tyson’s shipments to China.
Tyson fell 43 cents, or 2.75 percent, to $15.22 in New York Stock Exchange composite trading. Shares have traded as low as $11.91 and as high as $20.57 over the past year.
The tariff will reduce customers’ willingness to pay what they did before the duty set in, though it likely won’t cut shipments much, said Mike Cockrell, chief financial officer for Laurel, Miss.-based Sanderson Farms Inc. The company’s imports will be charged a duty of 51.8 percent.
While Sanderson Farms is looking for avenues to change the Chinese government’s decision, “I don’t suspect it’s something they will revisit soon,” Cockrell said.
A spokesman for Pilgrim’s Pride Corp. wasn’t immediately available for comment.
Tyson is the largest U.S. chicken processor based on 2009 production, followed by JBS SA’s Pilgrim’s Pride unit, closely held Perdue Inc. and Sanderson, according to WATT Poultry USA, a magazine covering the industry.
Earlier in September, U.S. poultry producers began shipping product to Russia after its markets were closed in January.
Russia essentially barred U.S. chicken by slashing the allowable amount of chlorine U.S. producers can use to disinfect the meat.
Mickelson said in June that Russia accounted for 10 percent of Tyson’s international chicken sales of $1.6 billion in fiscal 2009, and 18 percent of its $1.6 billion in exports in fiscal 2008.
Information for this article was contributed by Shruti Date Singh of Bloomberg News, Keith Bradsher of The New York Times, and the Arkansas Democrat-Gazette.
Business, Pages 23 on 09/28/2010