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NZ frozen fry dumping spat with EU: Official report released

The Ministry of Business, Innovation and Employment (MBIE) in New Zealand has released its Interim Report (Essential Facts and Conclusions) on the investigation into European dumping of frozen frozen potato fries and wedges into the NZ market.

Potatoes NZ says in a press release that the MBIE investigation found there is dumping, but it has deemed it not of material threat to the NZ industry or at a level requiring tariffs.

Potatoes NZ are reviewing the report this week and meeting with processors next week to determine next steps. PNZ have 10 days to submit further on their conclusions.

MBIE says in the report: “The outcome of the examination is that there is no dumping of subject goods from Belgium, while from the Netherlands there is no current dumping by Aviko and Farm Frites, and there is current dumping by Lamb Weston [with a weighted average margin of 17%].”

With regard to the likelihood of continued dumping, MBIE concluded that the goods imported from Lamb Weston in the Netherlands are likely to continue to be dumped.

The report says that “The data shows that Belgium and the Netherlands are not the main source of New Zealand’s imports of frozen potato fries and wedges – that has been Australia which has contributed nearly half of the annual volume of imports since FY2016.”

MBIE also MBIE has established that “there is no significant price undercutting by dumped imports of the subject goods from the Netherlands. There is undercutting by the Belgian exporter, but these goods are not dumped.”

Read the full MBIE report here.

Source: Potatoes NZ
Background: Potatoes NZ provides the following background to this matter:

The MBIE investigation was in response to the application from Potatoes NZ on 20th August 2020 regarding the threat to the NZ potato processing sector of increased dumped imports of surplus European frozen fries. The dumping and material threat to the New Zealand industry, combined with the effects of supply chain disruption caused by Covid-19, created an extraordinary situation that required investigation.

Globally, the disruption of supply chains, and particularly sales to hospitality, by virtue of COVID-19 restrictions, has led to huge surplus capacity of frozen fries in major production centres, in particular the European Union (EU). This has led to extraordinary surplus in frozen potato chips and processing tubers in the EU.

The concern for the NZ industry remains that along with the existing domestic impact of the pandemic crisis, any profiteering activity from overseas exporters, will in turn cause further damage to the New Zealand potato-growing and potato-processing industries.

NZ Potato Industry Fast Facts:

  • The NZ potato industry value is just over $1 billion dollars per annum
  • NZ processed potatoes account for 55% of NZ potato industry value
  • 85% of all fries eaten in NZ are NZ fries
  • 15% of fries consumed in NZ are imported
  • ½ NZ fries produced are exported = $100 million

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