CP Prima Questions CBP’s Testing Methodology
U.S. Customs and Border Protection (CBP) officials are en route to Indonesia to test the production facilities of a prominent shrimp exporter the agency suspects of transshipping.
PT Central Proteinprima, also known as CP Prima, one of the world’s largest shrimp exporters, has had multiple containers of shrimp held at the port of Los Angeles while CBP has product samples tested in a lab. The agency claims trace mineral tests indicate that the shrimp was transshipped from China, says attorney Susan Kohn Ross of Mitchell Silberberg & Knupp in Los Angeles, who represents CP Prima.
Transshipping is the illegal tariff-evading practice of exporting product through a tariff-free country. Chinese shrimp is subject to U.S. tariffs; Indonesian shrimp is not.
The shrimp in question, says Ross, is from Indonesia, where CP Prima is based. CBP is not disclosing the methodology used to conduct the trace mineral tests because the case is still under investigation, she says.
Citing scientists she’s been in contact with, Ross says trace mineral tests are an unreliable gauge of country of origin for shrimp. Seawater has the same mineral content, regardless of its origin, and CP Prima uses the same fish feed formula in all the countries in which it operates, she says. Trace mineral tests are typically applied to plants.
Ross says it will take several days for CBP to disclose the test results from its CP Prima visit.
In the meantime, the ordeal “is causing an unbelievable disruption in supply,” she says. Some of CP Prima’s containers were released, but U.S. importers were hit with a 113 percent antidumping tariff, the rate assigned to most Chinese shrimp.
The U.S. government is suspicious of shrimp being transshipped through Indonesia because U.S. imports of Indonesian shrimp have increased dramatically since tariffs were enacted in 2005. Through November 2008 they were up nearly 50 percent year-over-year, to more than 173 million pounds. Indonesia is now the United States’ No. 2 shrimp supplier, trailing only Thailand.
However, CP Prima expanded its Indonesian shrimp production significantly last year. The company acquired shrimp ponds from PT Dipasena Citra Darmaja in May 2007 and now has more than 50,000 hectares of shrimp ponds.