reLAKSation 191.
Flexibility
to say no: Stig Munck Larsen, a senior civil
servant in the Danish Ministry of Economic and Business Affairs told IntraFish
that neither the European Commission nor the EU’s processing industry can live
with the prospect of offering thousands of jobs in the EU’s own processing
industry just to save a few hundred jobs in Scotland. He said that the
Commission is fully aware of this, which is why they are working to find a long
term solution that all parties can accept.
We,
at Callander McDowell, are rather puzzled as to why the Commission should now be
working hard to find a long term solution to this dispute. After all, it is the
Commission that are responsible for putting the international salmon industry in
this situation. We sympathise with the Commission because they had no choice but
to initiate the process leading to safeguards because they were asked by the
Government of a Member State to do so. However, we believe that the Commission
were wrong to pursue a parallel dumping case, even though they were entitled to
do so because the complainants were the same in both cases. We would argue that
the safeguard process should have been allowed to reach its conclusion before
deciding whether a dumping case should be progressed. Instead of evaluating the
merits of the dumping case, we believe that the Commission were swayed by the
findings of the safeguard investigation and allowed the dumping case to proceed.
The decision to allow these cases in parallel has complicated the issue because
rather than be allowed to defend each case separately, the Norwegians were
simply given a choice of accepting safeguard measures or dumping duties, even
though the safeguard case involved other industries besides their own.
Having
now imposed provisional duties, the Commission appear to be back-pedalling and
apparently have put forward a compromise deal and offered a minimum import price
instead. Mr Larsen has indicated that if this compromise was implemented then
the MIP must be flexible to allow for price fluctuations over the five year
length of the punitive measures. However, we wonder whether Mr Larsen has become
more concerned about the intricacies of the deal rather than whether a deal is
acceptable.
In
all the discussions in the various press reports, one aspect of any compromise
deal seems to have been forgotten and that is the reaction of the European
Salmon Producers Group who instigated both the safeguard and dumping cases. We
would expect that any compromise deal will not be acceptable to them. The key
question is whether the EUSPG have the power to override any compromise deal or
whether their views are ignored.
We,
at Callander McDowell actually don’t think that it matters at all. What we
believe is that this case should be invalidated and the provisional duties
withdrawn. The fact that the investigation, involving exactly the same parties,
was run in parallel with the safeguard process has clouded any judgement and
therefore must be considered to be unfair. This doesn’t necessarily mean that
the Commission should reject the Scottish claims but simply that they should be
resubmitted as of the conclusion of the safeguard case. The anti-dumping case
can then be judged on its own merits and not be influenced by the earlier
safeguard application. This would offer the Commission the flexibility to find
the type of long term solution that would be acceptable to all sides.
Na
H-Eileanan An Iar: The EUSPG’s tame
politician paid the ultimate price for ignoring the fact that many of his
constituents work in salmon farming besides those employed by EUSPG members.
Labour MP, Calum MacDonald, was one of the 47 casualties who lost their seat in
Parliament on election night. Of course, the salmon case was not the only reason
that Mr MacDonald was ousted from Westminster but it played a part in his
downfall.
SNP
candidate Angus MacNeil reclaimed Na
H-Eileanan An Iar for the Scottish National Party. He takes over as more jobs
are lost through the inevitable consolidation and reorganisation which the
salmon farming industry must undergo. Whilst the job losses following-on from
the merger of Marine Harvest and Stolt Sea Farms are not the direct result of
the safeguards initiated by Mr McDonald, the ensuing safeguard measures would
have forced the Scottish industry to reorganise to become more efficient and
this could have led to more job losses anyway. This is something which Mr
MacDonald probably could have never envisaged. In much the same way he probably
never expected that one of the first casualties of the safeguard case would be
himself.
Fingers
to them: We, at Callander McDowell, have
regularly argued that the market disruption resulting from the repeated dumping
cases are simply the consequence of an industry stuck in outdated production
strategies when they should rather invest in
those strategies, which are more market-led. Sadly, farmers, such as
those in the EUSPG remain blinkered to the opportunities of the marketplace
preferring to believe that consumers be falling over themselves in the rush to
buy superior quality Scottish salmon. Clearly, if this perception of what
consumers want was true, then they would not be resorting to yet another dumping
case in order to remove competitive product from the marketplace.
Those
parts of the ‘Scottish’ industry who persist with this view believe previous
research which showed that the bulk of salmon consumers are those in the older
age groups who have more disposable income to send on ‘quality’ product and
more time to cook it. The salmon industry’s market strategy has been to
persuade such consumers to eat more salmon. The problem is that as these older
consumers pass on, the younger age groups who replace them have no experience of
eating salmon and are unlikely to start doing so as they age. It is therefore
important to persuade younger age groups to eat salmon from an early age.
However they are not going to unless the salmon industry puts salmon into a form
with which such consumers are familiar. Ten years ago we at Callander McDowell
suggested that if it were necessary to put salmon in a staple product like fish
fingers then why not. The response from the traditionalists in the industry was
that fish fingers made from salmon were akin to heresy. We were told that this
is not what you do with salmon. We therefore commissioned a processor to make
some to show it could be done and if we
say it ourselves, they were quite good. We even managed to generate interest
from the a couple of the supermarket chains. Unfortunately, we couldn’t source
sufficient salmon of the right quality to take it any further and as a result,
the our fish fingers remain stored away in a freezer.
It was however very pleasing to us, when as part of our regular market surveys, we saw that British seafood company, Young’s had just launched as part of their Young' uns range, a pack of salmon fingers
These
come at a time when the traditional industry, who remain blinkered to the
marketplace, are responsible for the imposing of provisional dumping duties.
Clearly, they don’t want young consumers to eat salmon since their aim is to
sufficiently limit supply so that they can again justify calling their salmon
special. Let’s only hope that young consumers can prove them wrong.