By Jennifer Kemp
Nearly a year after the United States International Trade Commission ruled that Argentine and Chinese honey imports injured the U.S. honey industry, domestic honey producers have seen prices jump from 65-70 cents a pound to $1.50 per pound.
On Sept. 29, 2000, the American Honey Producers Association (AHPA) and Sioux Honey Association (SHA) filed suit with the ITC, claiming that both Argentina and China were flooding the market with below-cost-of-production honey. Together, the two countries’ imports totaled nearly 158 million gallons of honey in 2000, up from 100 million gallons in 1998. In that same three-year period, the price of honey imported by these two countries fell by 25 percent. In any given year, the U.S. has an average consumption of 300 million gallons of honey. Domestic honey producers alone produce up to 220 million gallons of honey per year. Thus, the increased imports of honey from China and Argentina truly saturated the U.S. honey market.
After a year of investigation, the ITC agreed that Chinese and Argentine honey exporters were engaging in unfair trading activities. The ITC’s ruling authorized the U.S. Customs Service to impose anti-dumping duties on the two countries, which will be in place for the next 5 years. Honey imports from Argentina will be subject to duties ranging from 33% to 61%, while Chinese imports will have duties ranging from 26 percent to 184 percent placed upon them.
The effects of the ruling were felt almost immediately by the U.S. honey industry. Earlier this year after the duties were imposed, honey prices jumped by 20 cents per pound. Today, U.S. honey producers are getting nearly 80 cents per pound more than they were when the suit was filed.
According to Lyle Johnston, President of the AHPA, the ITC’s ruling has resurrected the U.S. honey industry. To break even, a U.S. honey producer must receive 85 cents per pound of honey, yet in the years leading up to the lawsuit, producers were receiving as little as 45 cents per pound. Bringing the lawsuit was not cheap either; U.S. honey producers raised nearly $1 million to bring the suit, and were asked to give money at a time when many of them were on the brink of financial ruin. However, “people really dug in and gave what they could,” said Johnston.
The hard work and determination paid off. While Johnston doesn’t expect honey prices to remain at $1.50 per pound, he does see the price settling around $1.20 per pound. Likewise, the high cost of the suit was well worth the price; the industry has seen a $140 million return on its $1 million investment.
“We are on the road to recovery,” says Johnston, “without this break, we would have lost over 30 percent of the honey producers in the U.S.”