US cotton imports damaging Turkish production, Turkey probe finds

 10 Feb 2016 - 18:12

US cotton imports damaging Turkish production, Turkey probe finds
Representative image. A man carries a sack of cotton in the countryside near the Syrian city of Raqqa. Reuters Nour Fourat

 

By Can Sezer

 

ISTANBUL: Turkey said it has concluded that U.S. cotton imports are damaging domestic output after a more than year-long review, dealing a potential blow to the world’s No. 3 grower of natural fiber amid concerns Ankara could resort to anti-dumping duties.

“Cotton imports originating from the United States have caused material damage to local production,” the Economy Ministry said in an interim investigative report.

U.S. and Turkish traders are invited to send in responses to the report by Feb. 24, a ministry official said. A final report would then be drawn up “in a reasonable amount of time”.

A committee would then decide whether to advise that anti-dumping tariffs be imposed.

“The fact that U.S. cotton imports were identified as a main reason for damage and that dumping margins were spelled out leads us to think that Turkey is willing to impose measures,” Bulent Hacioglu, an attorney at Istanbul-based trade law firm Trade Resources, told Reuters.

The report said the majority of U.S. cotton was sold to Turkey by four firms: LD Commodities Cotton LLC (LDC), Noble Americas Resources Corporation, Cargill Cotton Business Unit and Staple Cotton Cooperative Association.

The investigation calculated the dumping margin at 3.14 percent of cost insurance and freight (CIF) prices for Cargill, 5.89 percent for Noble, 6.17 percent for Staple and 7.91 percent for LDC.

The margin for other exporters was calculated at 5.9 percent. The figures show the maximum tariffs Turkey could impose on U.S. cotton.

The inquiry was launched in October 2014 and needs to be finalised by April 18, according to local regulations.

U.S. cotton made up around half of Turkey’s cotton imports in 2012-2014. In 2014, Turkey imported 450,226 metric tonnes of U.S. cotton, worth 915 million dollar according to the report.

Turkey was the world’s seventh-largest producer of cotton last year with 2.65 million bales of the crop, according to data from the National Cotton Council of America.

(Editing by David Dolan and Mark Heinrich)

Reuters