Cheap Italian tinned tomatoes will go up in price after the Turnbull government backed an Anti-Dumping Commission recommendation to impose dumping duties on two popular brands of canned tomatoes, Feger and La Doria.
“Dumping” is when a manufacturer exports a product to foreign markets at a price lower than they’d expect to receive domestically. The Commission’s role is to investigate whether such behaviour harms local, similar industries as a result.
The ruling applies dumping margins of 8.4% to Feger, Italy’s largest producer, and 4.5% to La Doria imports.
This is the second anti-dumping verdict against Italian imports and now means that all canned tomatoes from Italy are now subject to anti-dumping measures.
The decision vindicates a two-year campaign by Australia’s last remaining tomato cannery, SPC Ardmona in Victoria, which in 2014, sought federal government assistance to revamp its facilities, only to face criticism from then treasurer Joe Hockey. He rejected the company’s plea for $25 million.
The decision also reverses the Commission’s previous finding, which saw La Doria and Feger di Gerardo Ferraioli escape penalty after the ADC concluded their products were not dumped, or dumped but with a negligible margin that did not harm Australian industry.
The ADC previously found that more than half the Italian tinned tomatoes imported were illegally “dumped”, and and the vast majority sold through Australia’s leading supermarkets.
As a result, tariffs of up to 26.35% were introduced on nearly 100 brands of imported tomatoes.
On 24 November 2014, SPC Ardmona went back to ADC over the issue of dumping by Feger and La Doria, sparking another investigation.
Twelves months ago, the two companies responded claiming that the investigation violated World Trade Organisation agreements signed by Australia, but the ADC pressed on regardless, finding that:
The Commission is satisfied that the totality of direct income support payments made to growers of raw tomatoes in Italy have significantly affected the prevailing market prices in Italy for raw tomatoes.
The Commission is therefore satisfied that the costs recorded by Feger and La Doria for raw tomatoes in their records do not reasonably reflect competitive market cost.
The ADC concluded that “production costs would increase by 23% if subsidies were removed”, which led them to impose the dumping duties to two of the biggest selling brands in Australia.
Industry minister Christopher Pyne said the ADC’s latest decision was a big win for Australian producers
“This ruling will ensure that Australia’s only canned tomato producer, SPC Ardmona, can now compete equally in Australian stores and supermarkets,” he said.