In an unprecedented move, the government of Turkey placed dumping duties upon the U.S. for their cotton imports last Monday. According to reports, the local cotton production in Turkey has apparently been damaged so they placed anti-dumping duties.
The news, which has been going on since February, when Turkey initiated their investigations towards the growing cotton imports by the U.S. affecting their domestic production, have since then received a 3% CIF (Cost, insurance and freight) which has an immediate effect, as per Reuters.
According to the publication, the news was not surprising for the U.S. since it has been previously announced by Turkey that they are going to be giving a result on their investigation soon about how they will treat the situation
The National Cotton Council of America (NCCA) have also released a press statement, as per their website, stating that since Turkey is the second to import most of U.S. cotton with 1.5 and 2.0 million bales shipments places U.S. in a disadvantage.
"Cotton imports originating from the United States have caused material damage to local production," the Economy Ministry said in an interim investigative report, as per another report from Reuters.
"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," Bülent Hacıoğlu, an attorney at Istanbul-based trade law firm Trade Resources, said, as per the publication.
The investigation was also believed to be in response to several U.S. trade investigations of Turkish steel imports. The Turkish government then initiated the investigation against the World Trade Organization (WTO) standards.
Apparently, Turkey failed to show any special circumstance as to why they will place a 3% CIF towards U.S. "In the first place, the investigation itself lacked transparency regarding information used to justify the investigation," NCC Chairman Shane Stephens said, as per the release. "In fact, data used in support of a finding of injury to the Turkish domestic cotton market ignored established facts to the contrary."
Stephens expressed his opposition further by saying, "Unfortunately, the import duties only compound the difficult economic climate facing U.S. cotton growers and merchandisers." "The Council will continue to actively oppose the imposition of duties and is exploring ways to reverse the decision, such as WTO mechanisms and the Turkish judicial system," Stephens continued.
Meanwhile, the investigation reportedly kicked off in Oct. 2014 and the recent report showed that the U.S. cotton was sold to Turkey by four firms, namely LD Commodities Cotton LLC (LDC), Noble Americas Resources Corporation, Cargill Cotton Business Unit and Staple Cotton Cooperative Association.
